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Ms. KLOBUCHAR. I wish to thank Senator Murray for her leadership on this budget. This is not an easy thing. We all know this. She actually has been working on this many years. I am very proud of this budget and the work which has been done here, the balanced approach which has been taken.
I wish to thank Senator Mikulski, the Senator from Maryland, our fearless leader of the women Senators, who has been there since the beginning and understands these fights in a different way than many of us who are new can't imagine. We will need to continue moving forward for the women of this country and can never step backward, which is where I wish to begin discussing this budget.
The budget Senator Murray has proposed is a budget which moves us forward. For a long time, Democrats and Republicans in the Senate have been talking about how we need to get $4 trillion in budget reduction and deficit reduction over the next 10 years.
We have done $2.4 trillion. It is a start. It is not all we need to do, but it is a start. Of that amount, the $2.4 trillion, 70 percent was in cuts. When we look at the proposals which have been made by Simpson-Bowles, Rivlin-Domenici, the Gang of 6, all the groups which have worked on a very strong bipartisan basis, they have all proposed something like 2 to 1 on spending cuts to revenue.
The proposal which has been made on the House side which passed in the House today isn't even close to that. In fact, when we look at Congressman Ryan's budget, there isn't revenue in this budget. He does include some of the past revenues. Even when you do that, that is a 10-to-1 ratio of spending cuts to revenue for this country going forward. It is not the right mix. Yes, we need to balance our budget, but we also need a balance which is budgeted.
The last thing we need to do is balance our budget on the backs of women and children. This is why it is important for people. I will return later to speak about some of the economic issues in my State and why it is so important to move forward and have a budget with a balanced mix of spending cuts and revenue. I truly believe we need a deal here. We need to bring this debt down. It is very important to me because I think it will trigger investment. We need to do it in the right way.
Today, I am focused on one issue; that is, the effect this budget would have on women and children, the budget proposed in the House versus the budget Senator Murray has put together.
It is no coincidence the Senator who is leading us through this budget process is the same Senator who joined me last spring when the Violence Against Women Act was on the floor. We needed to rally all 17 women Senators behind us. At the time people thought it was stuck, it was a gridlock and wasn't going anywhere. Then all the women Senators, Democrats and Republicans, came together.
Patty Murray was the leader in this effort. This is why this Senate budget not only maintains but increases critical funding for the Violence Against Women and Family Violence Program. This will give law enforcement better tools for responding to cases of domestic violence and sexual assault, programs which make sure mothers and children have a safe place to go and programs which help victims get back on their feet again. Even more important, this includes programs which save lives.
As a former prosecutor, I know firsthand how important the Violence Against Women Act has been. We were very pleased it was reauthorized on such a strong bipartisan basis. It is incredibly important, not just for those individual victims but for entire families and entire communities. Statistics show kids raised in violent homes are 76 times more likely to be perpetrators of these crimes when they grow up.
This is why I truly appreciate Senator Murray's work to ensure we have a policy in place, which is something we worked on in the Judiciary Committee. I see Senator Hirono from Hawaii. We worked hard on this, as it is important, but also the funding is in place. We consolidated programs, reduced funding with the Violence Against Women Act and did different things in the last Violence Against Women Act to make it more efficient. This is fully funded in this bill, and it is very important for people to know who care about this.
As to health care, something which is very important to our kids, the House budget, as has been noted by Senator Stabenow and others, would slash billions of dollars in basic health care services for children, including prenatal care for expectant moms and vaccinations for kids. Under the House proposal, more than 33,000 women would lose access to maternal and child health care services in Minnesota alone. Meanwhile, another 8,551 children would lose access to lifesaving immunizations. This is only in my State.
Sadly, after the devastating flu season we just experienced, with many children dying across this country, how could anyone think it is a good idea to cut funding for vaccination programs? How could that be one of the proposals in this budget. There are so many loopholes we could close, so many tax subsidies we could eliminate. Why would we cut kids' vaccinations? Sadly, this is what happened in the House today.
While we are on the subject of health care, I also wish to point out the House budget would cut funding for the National Breast and Cervical Cancer Early Detection Program, meaning hundreds of thousands of women would lose access to mammograms, pap smear tests, cervical cancer screening, which is the tip of the iceberg. By repealing the Affordable Care Act, the House budget would threaten preventive care for women across this country. The Ryan budget would eliminate the important reforms to improve patient care, already noted by Senator Mikulski and Senator
Stabenow. It would eliminate the important reforms to improve patient care and the delivery system which is included in the health care bill.
What is interesting to me is Congressman Ryan does acknowledge the Affordable Care Act has some very good savings in it because he includes those over $700 billion in savings in his budget.
This is great, but then he cuts out all those budgets I spoke about which were so important to the American people: to not be banned from health insurance because you have a preexisting condition and to be able to keep kids on their parents' insurance until they are 26 years old. I am looking forward to that with my own daughter.
The third thing I mentioned is closing the doughnut hole for our seniors. Those things are all being cut under this budget.
We have had this debate too many times already. I wish to be clear; the Senate budget not only protects core funding for preventive services but upholds the Affordable Care Act and its most important provisions for women and children.
Let's turn to another front to see how women and children of this country, particularly children, fare and this is education. On the education front, the Senate budget--while still making $975 billion in cuts, $975 billion in spending cuts--still maintains core funding for early education through the Head Start Program. The House budget, when combined with sequestration, would push almost 200,000 low-income children out of the program in 2014.
We all know education is one of our best investments. When we look at the global economy and education growing across this country, we are getting real competition from other countries. The last thing we need to do is cut back on education.
This is why the Senate proposal includes continued support for elementary and secondary schools through programs such as IDEA, the ladder which provides early intervention in special education services to kids with disabilities. Our budget also makes key investments in improving literacy and increasing the emphasis on STEM, science, technology, engineering, math.
This is the future. We want to train our own kids in America, as Senator Sanders is well aware, to ensure they have the skills to be able to compete on the international stage.
What does the House budget do? It slashes close to $1.2 trillion of investments in education, skills training, science and technology, R&D, transportation and infrastructure over the next 10 years.
Do you know what I think. I think that is being penny wise and pound foolish and not what we should do in the budget for the United States of America. I truly believe we have an amazing opportunity right now. We have seen better unemployment numbers than we have seen in 4 years. The housing market is starting to turn around. People are starting to go back to work. It is not nearly where it should be. The last thing we need to do is go backward. The last people who want to see us go backward are the women of America.
I was listening as Senator Stabenow spoke about the health care bill, the Affordable Care Act, and during the Finance Committee there was a debate about whether maternity care should be included in the mandatory benefits. One of our colleagues at the time said: I don't understand why maternity benefits should be included. I never needed them.
Without missing a moment, Senator Stabenow looked across the table and said: I bet your mother did.
There are a lot of mothers around America right now who are looking at these budgets because these budgets represent values, the future of our kids and the women and men of this country.
Let's bring our spending down. Let's get over the $4 trillion figure we are supposed to get out of the debt reduction but do so in a way which doesn't hurt middle-class families and doesn't hurt the families most vulnerable. I know we can do it. We are a great country.
I yield the floor.
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Ms. KLOBUCHAR. Mr. President, I thank Senator Murray for her great leadership. I also wish to thank Senator Enzi and Senator Durbin on the Marketplace Fairness Act. This is a bill and an amendment that needs to pass. It is incredibly important to small businesses, big businesses, and to people across this country who work for retailers.
When I travel around my State, I hear from small, locally owned retailers about the competitive disadvantage they face against online retailers, small businesses such as Creative Kidstuff that sells educational and developmental books for kids and Thrifty White Pharmacy, a full-service, employee-owned drugstore.
Right now, States are currently unable to require out-of-State or online-only retailers to collect sales tax and it puts local mom-and-pop stores at a disadvantage. Not only that, but this tax loophole is draining billions of dollars in lost revenues from State and local governments--$23 billion last year alone across the country.
In effect, this tax loophole subsidizes some taxpayers at the expense of others and some businesses over others. That is why we call this the Marketplace Fairness Act.
I have been committed to a competitive agenda for this country since I got to the Senate, and part of that agenda includes not only encouraging competition and innovation, but it is also about having an even playing field for our businesses. Minnesota alone lost about $394 million in 2011 from out-of-State sales that are legally due but not collected. This lost revenue translates into over 7 percent of Minnesota's general sales tax liability in 2011. That is what we are talking about. This is real money.
One of the longstanding principles of tax fairness is that similarly situated taxpayers should be taxed similarly. A bookstore on Grand Avenue in St. Paul has to charge a sales tax, while an online retailer selling that same book hundreds of miles away does not. A consumer buying a T-shirt in downtown Duluth is taxed differently than his friend who is buying that same T-shirt on the Internet. Someone buying a TV at Best Buy--hometown company--in Richfield, MN, is taxed differently than if he buys the same TV online.
Our current situation encourages tax avoidance, undermines our tax system, and ultimately creates a competitive disadvantage for brick-and-mortar retailers at a time when we want them to succeed.
I am so excited that there is a bipartisan group of Senators supporting this bill. Our momentum is growing. We can see it today on the floor.
I ask unanimous consent to have printed in the Record a list of some of the supporters from my State that includes major stores such as Target and Best Buy to the Uffda Shop in Red Wing, MN. I have shopped there and I suggest my colleagues do the same. It also includes Mary's Morsels & Catering and Sleepy Eye Floral & Design, to give my colleagues just a sense of the hundreds of companies that support this in Minnesota.
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Ms. KLOBUCHAR. Mr. President, I wish to first thank Senator Murray again for her leadership on the Budget Committee. Day in and day out, month in and month out, she has been working on this budget and she has achieved, along with the committee, a smart, balanced proposal for meeting our country's fiscal challenges.
This is not the first time I have come to the Senate floor to talk about the critical need for a balanced approach and to bring down our debt in a balanced way, but this is the first time in a long time I have actually felt optimistic that we are going to get a budget through the Senate and optimistic that there are a lot of stirrings of bipartisanship and compromise. While our budget, as has been pointed out and I will point out, is very different than the House budget, I think there are still grains of compromise there. We have seen this willingness in the Senate, with our Republican colleagues, to talk about bringing the debt down, whether it is the Gang of 6 or the Gang of 8 or whether it is the work of Simpson-Bowles or the work done with the Rivlin-Domenici group. These are all reasonable proposals. We don't agree with everything in them, but they are all reasonable proposals and they contain some balance.
The other reason I am optimistic is that we have a great opportunity here. I was reminded of this last week when former Republican Senator Judd Gregg testified before our Joint Economic Committee. He actually paraphrased the Foreign Minister of Australia saying, ``The United States is one debt deal away from leading the entire world out of economic doldrums.''
I couldn't agree more. Look at the economic news we have had in just the last month. We know there is so much work to do, that there are too many people unemployed, and there is too much investment that is not being made. But we also know that we saw the best month for unemployment numbers than we have seen in 4 years. We are seeing a turnaround in the construction market. We are seeing a turnaround in the housing market. I can tell my colleagues that in my State, we have unemployment that is at about 5.6 percent. So we are seeing progress, but we have more to do. The last thing we need to do now is to go backward. We need to go forward, and that is what Senator Murray's budget does in a very balanced way.
As I have said many times before, we are talking about balance. I believe the Senate budget achieves the right equilibrium. It includes an equal mix of responsible spending cuts and new revenue from closing loopholes and ending wasteful spending in the Tax Code. Our proposal builds on the $2.4 trillion in deficit reduction we have already received--I don't think every citizen knows that--$2.4 trillion. Let's remember 70 percent of that was spending cuts and the other 30 percent was revenue. That is a balance. It is not exactly the balance we wanted on our side of the aisle, but if we were to adopt the House budget right now, we would be at, if we include the past revenues, 10-to-1 spending cuts to revenue. That is not the balance we are seeing in the other proposals that have been made by these bipartisan groups.
How does our budget do this? The additional debt reduction to the $2.4 trillion we have done to get to over $4 trillion in debt reduction--first of all, $975 billion in targeted cuts and $975 billion in revenue. Again, this will help us to surpass the bipartisan goal of $4 trillion and put our debt-to-GDP ratio at about 70 percent.
Some of the most important points in the Senate budget include the fact that it replaces sequestration--which is just a hammer--with smart, targeted cuts while also making critical investments in areas such as education, workforce training, and infrastructure.
When I get out in our State with our unemployment rate at 5.6 percent, I hear time and time again that there are jobs unfilled, that we need to train workers, that we need our high school kids to be going into trades again, to be going into technology, math, and science. This budget accounts for that. It produces savings in Medicare and Medicaid by eliminating waste and fraud, promoting efficiency, and emphasizing cost alignment. We know a little bit about this in Minnesota, with the Mayo Clinic and the way we deliver health care in a high-quality, low-cost way.
One study out of Dartmouth showed that if they simply used in the rest of the hospitals across the country the cost-effective ways of the Mayo Clinic, we could save $50 billion--$50 billion in 5 years with chronically ill patients. That gives a sense of what we are talking about when we talk about high-quality, low-cost care.
Our budget also recognizes there is a massive amount of spending that takes place through the Tax Code to the tune of over $1 trillion per year in tax expenditures.
I come from a State with a thriving renewable energy sector, and 2 years ago we agreed to let the ethanol tax credit expire at the end of 2011, which saved billions of dollars. In fact, that was $60 billion in 10 years--$60 billion. I do not understand why the oil industry cannot follow ethanol's lead. I am proud of the work they are doing. I have been out to Lewiston. I have seen the drilling in North Dakota. It has helped to increase our own domestic oil production and decrease our dependency on foreign oil. But I do not believe the oil companies still need $40 billion in 10 years. That is a lot of money we could bring in to reduce the debt.
We can make other commonsense changes. One I would propose is with the home mortgage deduction, very near and dear to everyone's heart. Cap it at $500,000 in value of a home. If you buy a million-dollar home, great. Then you get it for up to $500,000 in value of the home. That brings in tens of billions of dollars in debt reduction.
All told, the proposal that is coming out of Senator Murray's budget reduces the deficit by approximately $2 trillion. If enacted, our debt will continue on a downward path, where our debt-to-GDP ratio will be, as I mentioned, about 70 percent. The Congressional Budget Office has stated that a debt-to-GDP ratio in that range would also result in a 1-percent increase in the size of the economy in that year.
We cannot discount the impact that a growing economy can have on deficit reduction. CBO expects GDP growth to be above 3 percent in 3 of the next 4 years. As the economy grows, we will see more revenue, and we will see lower deficits.
Former CBO Director Alice Rivlin, who just testified last week at a Joint Economic Committee hearing on the very topic of debts and deficits, said this:
The really important thing is to keep the debt from growing faster than the economy.
I could not agree more. Deficit reduction must be paired with economic growth. This is where we need to be, and I am optimistic that ultimately--while we have many differences that we are going to hear a lot about today--ultimately, we are going to come together on something that works for America.
Unlike the proposal in the House, I will tell you the Senate budget preserves and protects Medicare, ensuring that it is there for our seniors today and strong for our children and grandchildren tomorrow.
I firmly believe we can make some reforms to our Social Security safety net, and that those reforms--that money--can go right back into Social Security to keep it solvent. On the Medicare front, there are many things we can do without reducing the benefits for our current seniors, for the people who deserve that help.
Look at what we could do. The VA negotiates prescription drug prices and gets much less expensive drug prices for high-quality drugs. Right now, we do not do that with Medicare. By negotiating prescription drug prices under Medicare Part D, you could produce $240 billion in savings over 10 years right there. Why not leverage the power of America's seniors? They have a lot of power.
We all agree we need to reduce our debt. But our ultimate goal is not simply a balanced budget; it is a budget that is balanced.
Let's look at what goes on with the Ryan budget. Well, the Ryan budget gives millionaires a huge tax cut, drastically lowering their income tax rate from 39.6 percent to 25 percent.
Last year, the Joint Economic Committee, on which I serve, estimated that a similar plan introduced would have given millionaires an additional $285,000 in tax breaks, while hitting the average middle-class family with a $1,300 tax hike.
He also claims his tax cuts for the wealthy, which would cost about $4.5 trillion--and I say that because I believe they would be paid for by the middle class--will not add to the deficit. But Ryan refuses to name one specific loophole or expenditure that his budget would eliminate to pay for the tax cuts.
Some experts project that such extreme cuts, as we would see in his budget, would cost jobs. I believe that is true. That is why, as we are seeing this improvement in stabilization of our economy, we need to do things in a balanced way over the long term. We need to send the clear message that we are reducing this debt and get to our goal of $4 trillion in debt reduction in 10 years. But we simply cannot do it by doing it on the backs of the middle class who are still struggling in this country.
I urge my colleagues to support this budget proposal. It is time to get it done. I truly see this as a time of opportunities not only in the next 2 days to get the budget done, but also in the next few months as we negotiate with our colleagues across the aisle to get a budget for America.
Thank you very much, Mr. President.
I now yield 8 minutes to Senator Tester of Montana.
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Ms. KLOBUCHAR. Mr. President, I think we have made our case here with the $975 billion in spending cuts that are contained in the budget, and the fact that to date we have made $2.4 trillion in debt reduction, and of that 70 percent or $1.5 trillion has been spending cuts. What we are simply trying to do with this budget is keep this balanced approach to not set an economy--which was literally on its heels a few years ago--back in the same place. We want to do deficit reduction. We want to give our businesses the kind of consistency and incentive to invest, but not do it in a way which Chairman Bernanke has said would cause a sharp contraction by doing too much too soon at once on the backs of the middle class and seniors. I am very hopeful in the coming months I will be able to find some kind of compromise and agreement with our colleagues.
The American people are tired of the gridlock. They want to see people are willing to work together. I truly believe courage is not just standing alone but standing next to someone you don't always agree with for the betterment of this country. Senator Sessions and I have worked very well together on Judiciary matters, and I wish to continue to do this on the budget.
Turning to another matter, I spoke about marketplace fairness, and I support that amendment to this bill. I also want to talk about the medical device tax repeal. As I mentioned before, one of my major focuses in the Senate has been on an innovation agenda, the idea we should manufacture items in this country, invent things, and export to the world. This is how we are going to get out of the current situation we are in. I believe we can do it.
We need to do it by promoting innovation all across this country. My State has a long history of innovation, bringing the world everything from the pacemaker to the Post-it note. We are home to one of the world's leading medical device companies, Medtronic, started by Earl Bakken in his garage. It is not just the large medical device companies and their employees who keep this industry running, the small- and medium-sized companies and their entrepreneurs are incredibly vital as well.
In Minnesota we have over 400 medical device companies employing more than 35,000 people across the State. This thriving technology, the medical technology sector, has been one of the keys to our success and one of the bright spots in America's economy. When you look at the potential for exports, as you see a growing middle class in China and in India, people are finally going to the hospital. They are beginning to receive good health care. We have a great potential here for more jobs in America as long as we do this correctly.
The United States is currently the largest net exporter of medical devices in the world, yielding a trade surplus of roughly $5.4 billion a year. Medical device companies are also responsible for creating millions of high-paying, highly skilled American jobs, exactly the kinds of jobs we want in this country. These are the kinds of jobs where every parent sends their kid to high school and says, is he or she going to learn something which will create a job? I am looking at our pages right now, and I can tell you medical device jobs are one of those kinds of jobs.
In order to ensure our country remains a world leader in medical device innovation, we need to address the 2.3-percent excise tax on medical devices. As you know, this came out through the Affordable Care Act. At the time I opposed that tax. We negotiated and were able to get it halved from $40 billion to $20 billion in 10 years. It still isn't right because it creates too much of a burden.
Medical device manufacturers are not the ones which are going to get multiple new customers, millions of new customers out of the increase in coverage in the health care bill. Pharmaceuticals might. They negotiated something. Think about it. A lot of medical devices are used by people who are older. They tend to have health care coverage with Medicare and other things. This is the issue here is this is not at the right rate, this is not the right tax, and it should be repealed. The tax is a burden on medical device businesses but, most importantly, it is a disincentive for jobs. It stifles innovation, and it makes it more difficult for the next generation of lifesaving devices to make it to the market. I have been fighting to reduce it, repeal it, and to delay it since the first day it was introduced. At the end of last year, I rallied a record number of Democratic Senators behind the effort. While we couldn't get an agreement included in the fiscal cliff negotiations, we had great traction. I think there were 18 or 19 Democratic Senators in strong support.
I see Senator Coats from Indiana, as part of the strong support we had on the Republican side for repealing this tax.
This is why Senator Hatch and I have filed an amendment to the budget resolution to repeal this tax and help give these businesses and their employees the certainty and stability they need to keep researching, developing, and inventing the next medical breakthrough. Our amendment now has the support of 28 of my colleagues from both sides of the aisle. I am hoping we can continue to work in a bipartisan way.
I yield 2 minutes to my colleague Senator Franken of Minnesota to speak about this important issue.
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Ms. KLOBUCHAR. I want to thank the Senators who joined me today as we work to advance a smart, balanced approach for meeting our country's fiscal challenges. The time is ripe for common ground on a budget plan to move the economy forward. While I don't know if we will have that bipartisan plan in the next few days, I think we will get a budget through this Chamber which will pave the way for the kinds of bipartisan negotiations we need to have. We need to keep this country moving, and moving in the direction we need.
When I go out there and talk to small companies throughout my State, they want us to get something done. They want to have consistency so we are not playing green light, red light with the Tax Code; that they know exactly where they stand. I think they all acknowledge everyone is going to have to sacrifice a little here. I think they acknowledge we are going to have to do something which makes a difference and not just speak about it anymore. We have not only the opportunity but the responsibility to find common ground on a deficit reduction plan which will help build a stronger, more resilient framework for economic renewal so families and businesses have the certainty they need.
I think we know neither party is going to get everything it wishes, but this doesn't mean we can put our heads in the sand and pretend this isn't happening. I truly appreciate my Republican colleagues. When we meet behind closed doors and speak about this, they have a willingness to compromise. I think this is what will happen in the future. However, our job in the next 2 days is to get a fair budget through a balanced budget.
This is what Senator Murray's budget is. I have been part of this, and I look forward to working with her and our colleagues in the future to show the American people we can stand tall and do what is right.
Mr. President, I yield the floor.
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Ms. KLOBUCHAR. Mr. President, this is a bipartisan amendment. This is about innovation and jobs. The medical device industry is one of our biggest exporters. We have so many opportunities out there with a growing middle class in China and India to export even more, but we cannot have a tax that puts us at a competitive advantage. I think people understand that. This is about manufacturing, high-skilled jobs, millions of jobs in America.
I ask my colleagues to vote with Senator Hatch and me to repeal this tax.
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