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Mr. SANDERS. Mr. President, I thank Senator Murray for yielding, and I want to thank her and her staff for the excellent work they have done. As a member of the Budget Committee, I have enjoyed working with them.
Everybody knows our country has an $850 billion deficit and a $16-plus trillion national debt. But what has not been discussed as often as it should be is how we came into that financial position. How do we have the deficit and how do we have this huge debt?
Let us not forget, as we discuss this issue, that in January of 2001, when President Bill Clinton left office, this country had an annual Federal budget surplus of $236 billion. A surplus of $236 billion in January 2001. We now have an $850 billion deficit. So what happened?
Well, I think many Americans know what happened. When you go to war in Afghanistan and Iraq and you don't pay for those wars, you add to the deficit. When you give huge tax breaks to the wealthiest people in this country and you don't offset that, you add to the deficit. When you pass a Medicare Part D prescription drug program and you don't pay for that, you add to the deficit.
And on top of all of that, we must understand that right now, at 15.8 percent of GDP, revenue coming into the Federal Government is the lowest it has been in 60 years. The reason for that is we are in the midst of a very serious recession--a recession caused by the greed, recklessness, and illegal behavior on Wall Street. Not only has that led to significant increases in unemployment and businesses going under, once again, it resulted in less tax revenue coming in to this government.
And by the way, when we talk about Wall Street and the greed and the recklessness and illegal behavior on Wall Street, I must say I was stunned when the Attorney General of the United States recently suggested it might be difficult to prosecute Wall Street CEOs who commit crimes because of the destabilizing effect that prosecution might have on the financial system of our country and the world. In other words, we have a situation now where Wall Street is not only too big to fail, they are too big to jail. The theory is, if you are just a regular person and you commit a crime, you go to jail. If you are the head of a Wall Street company, your power is so great, the tentacles of that company are so great, that if you are prosecuted, and there is destabilization in that company, it can have worldwide or national implications. That is an issue we have to think long and hard about. We are supposed to be a country of law, and that law should apply to the CEOs of Wall Street companies as well as everybody else.
The other point I want to make deals, if you will, with a moral issue. When you are dealing with a deficit situation--and I just described how we got into the deficit situation--and you say we need to make sacrifices, it is absolutely appropriate to ask who is best able to make those sacrifices. Right now, as I think most Americans know, the wealthiest people in this country are doing phenomenally well. Large corporations are enjoying record-breaking profits. That is one group of people. Meanwhile, the middle class of this country is disappearing, and we have 46 million people living in poverty. So common morality, basic morality, says who should we ask most significantly to help us with deficit reduction? Do we tell an unemployed worker who is struggling to keep his or her family afloat that we are going to balance the budget on their back or do we ask, a huge profitable corporation, that in some cases is paying nothing in taxes, to help us with deficit reduction?
It is important for us to do what we do too rarely on the floor of the Senate--take a hard look at what is happening to the American people right now. I am very pleased we are seeing more job creation. Good thing. We are seeing somewhat of a recovery in housing. Very good thing. But let us understand where the middle class of this country is today, where the working class of this country is today before we demand that we balance the budget on their backs, as the Ryan budget in the House does.
Since 1999, the average middle-class family has seen its income go down by nearly $5,000 after adjusting for inflation. Median family income today is lower than it was in 1996. Real unemployment is not 7.7 percent, it is 14.3 percent if you count those people who have given up looking for work and are working part time. Youth unemployment is even higher. More than 25 percent of young Americans are unemployed. In terms of the African-American community, unemployment is off the charts.
When we talk about job creation, we all want job creation. However, it is important to understand that nearly 60 percent of the new jobs that have been created since 2010 are low-wage jobs paying between $7.80 an hour and $13.80 an hour.
Jobs, yes. But we want jobs that can take care of families, not just low-wage jobs.
Further, when we are talking about the budget, we don't talk about this at all. I know my Republican friends don't talk about it; most of my Democratic friends don't talk about it. It is anathema here to talk about issues of distribution of wealth and income, but I think it is important before we talk about on whose backs we are going to balance the budget.
Today the United States has the most unequal distribution of wealth and income of any major country on Earth, and the gap between the very, very wealthy and everyone else is growing wider and wider. Incredibly, the wealthiest 400 individuals in this country today own more wealth than the bottom half of America, 150 million people. I think that is an issue we might want to discuss even if it offends some of our wealthy campaign contributors, but I think we should put that on the table.
Today one family--the Walton family of Walmart--owns more wealth than the bottom 40 percent of families in this country. And by the way, you will all be delighted to know they got a huge tax break recently.
Today the top 1 percent owns 38 percent of all financial wealth. That is a stunning number. What is even more stunning is the bottom 60 percent owns 2.3 percent of the wealth in this Nation. One percent on top owns 38 percent of the wealth; the bottom 60 percent owns 2.3 percent. And who do Mr. Ryan and my Republican friends want to balance the budget on? Those 60 percent, the working families who already have nothing, who are losing what they have, who are struggling to keep their heads above water.
But it is not just distribution of wealth, it is distribution of income. If you can believe it--this is again a stunning fact which, for some reason, we don't talk about too much here on the floor. A recent study shows that had all of the new income gained from 2009 to 2011 gone to the top 1 percent, 99 percent gained nothing. So who do we balance the budget on? Of course you go after the middle class, go after the working class, go after low-income people. Well, maybe somebody might want to ask that 1 percent to start paying a little bit more in taxes before we cut Social Security, Medicare, Medicaid, education, and nutrition.
One of the good parts of the Murray budget is that it provides $100 billion in funding to put millions of Americans back to work rebuilding our crumbling infrastructure. I would have gone much higher. Because while deficit reduction is a very serious issue, it is even more important that we start putting millions of people back to work who are in desperate need of employment. The fastest way to do that is to rebuild our crumbling infrastructure. One hundred billion is a good start. We need more.
During the consideration of the budget resolution, I plan on offering two amendments. The first, amendment No. 264, would create a reserve fund to reduce the deficit and create jobs by eliminating offshore tax abuse by large profitable corporations. The second, amendment No. 198, would establish a deficit-neutral reserve fund to protect the benefits of disabled veterans--and I speak as chairman of the Veterans' Affairs Committee--disabled vets and their survivors by not enacting the so-called chained CPI. I am pleased that this amendment is being cosponsored by Senator Harkin and Senator Hirono. Let me take a few minutes to describe both of these amendments.
At a time when corporate profits are at an all-time high, when the effective corporate tax rate is at a 40-year low, when one out of four profitable corporations pays zero in taxes, it is time for large profitable corporations to significantly contribute to deficit reduction.
The first amendment I will be offering would create a reserve fund to reduce the deficit and create jobs by eliminating offshore tax abuse by large profitable corporations. In 2011, corporate revenue as a percentage of GDP was just 1.2 percent. That is lower than any other major country in the Organization for Economic Cooperation and Development, lower than Britain, Germany, France, Japan, Canada, you name it. Each and every year, corporations and the wealthy are avoiding more than $100 billion in U.S. taxes by sheltering their income offshore. Offshore tax schemes have become so absurd that one five-story building in the Cayman Islands is now the home to more than 18,000 corporations.
When the Bank of America, Goldman Sachs, JPMorgan Chase, and Citigroup needed a taxpayer bailout in 2008--and I did not vote for that bailout--they told us what great Americans they were, how much they love the United States of America, proud to be an American. But when it comes to paying their taxes, these large Wall Street companies are proud to be with the Cayman Islands. So my suggestion to these corporations: Next time you need a bailout, don't come to the taxpayers of America. Go to the people of the Cayman Islands and get your bailout there. But so long as you are an American company, how about helping us with deficit reduction and paying some taxes in this country?
But it is not just Wall Street. You have pharmaceutical companies such as Eli Lilly and Pfizer also using offshore tax havens. Apple wants all the advantages of being an American company, but it doesn't want to pay American taxes or American wages. It creates the iPad, the iPhone, the iPod, and iTunes in the United States, manufactures most of its products in China, and then ships most of its profits to Ireland, Luxembourg, the British Virgin Islands, and other tax havens to avoid paying U.S. taxes.
This is a huge issue. By the way, it is not just an American issue. It is an issue facing governments all over the world: Corporations run to tax havens, Cayman Islands, Bermuda, and elsewhere. We have got to address that issue.
I am going to list for the Record 15 large profitable corporations that have used offshore tax havens to avoid paying U.S. income taxes in recent years. At the top of the list, Bank of America. In 2010, Bank of America set up more than 200 subsidiaries in the Cayman Islands to avoid paying U.S. taxes. It worked. Not only did Bank of America pay nothing in Federal income taxes but it received a rebate from the IRS of $1.9 billion that year.
Before you cut Social Security and Medicaid and Medicare, do you think maybe we might want to ask Bank of America--which we bailed out, by the way--to help us with deficit reduction?
General Electric during the last 5 years made $81 billion in profits. Not only has General Electric avoided paying Federal income taxes during these years, it received a tax rebate of $3 billion from the IRS. GE has at least 14 offshore subsidiaries in Bermuda, Singapore, and Luxembourg.
Citigroup, Verizon, Honeywell International, JPMorgan Chase, Merck, Corning, Boeing, Goldman Sachs, Microsoft, Qualcomm, Caterpillar, Cisco Systems, Dow Chemicals, major profitable corporations using tax havens to avoid paying in the United States of America. We have an amendment to deal with that issue, and I hope we can have bipartisan support for that amendment.
Now I want to talk about my second amendment, and now I speak as chairman of the Veterans' Affairs Committee.
This amendment, No. 198, would establish a deficit-neutral reserve fund to protect the benefits of disabled veterans and their survivors by not enacting the so-called chained CPI. I am pleased this amendment is being cosponsored by Senators Harkin and Hirono.
The time has come for the Senate to send a very loud and clear message to the American people: We will not balance the budget on the backs of disabled veterans who have lost their arms, their legs, and their eyesight defending our country. We will not balance the budget on the backs of the men and women who have already sacrificed for us in Iraq and Afghanistan, nor on the widows who have lost their husbands in Iraq and Afghanistan defending our country. And we will not balance the budget on the backs of those who served so valiantly in World War II, the Korean war, the Vietnam war, the gulf war, and other conflicts, by cutting Social Security benefits. We will not the adopt the chained CPI.
The chained CPI is forcefully opposed by every major veterans organization in this country. I have talked to many of them, and they are outraged after the sacrifices veterans have made that people want to balance the budget on their backs. All veterans organizations are in opposition to the chained CPI, and that includes of course the American Legion, the VFW, the Disabled American Veterans, the Iraq and Afghanistan Veterans of America, Gold Star Wives, DAV. You name the veterans organization, and they are in opposition.
But it is not just the veterans organizations that oppose the chained CPI. The chained CPI is opposed by every major senior citizen group in this country--including the AARP, the largest senior group. And I understand they have been calling Members of the Senate and the House, and I hope Members will listen to what the AARP has to say--and the National Committee to Preserve Social Security and Medicare, and the Alliance for Retired Americans.
The chained CPI is opposed by every major union in this country. I had a press conference not so long ago with Rich Trumka of the AFL-CIO. They are strongly opposed to the chained CPI. The chained CPI is opposed by every major disability group in this country. It is opposed by the National Organization for Women, because they understand what the chained CPI would mean for women.
There are some who believe that lowering costs of living adjustments--COLAs--through the adoption of a chained CPI would be just a minor tweak in benefits. Let's be clear. For millions of disabled veterans and seniors living on fixed incomes, the chained CPI is not a minor tweak. It is a significant benefit cut that will make it harder for permanently disabled veterans and the elderly to feed their families, heat their homes, pay for their prescription drugs, and make ends meet. This misguided proposal must be vigorously opposed.
In one moment or another everybody here has talked about how they want to save Social Security, because they know that back home Social Security is enormously popular. In poll after poll--whether you are Democrat, Republican, Independent--what people are saying is, Don't cut Social Security. Don't cut benefits for disabled veterans. Now we are going to give Members on both sides of the aisle the opportunity to act on what they have been saying for many years.
Supporters of the chained CPI want the American people to believe that the COLAs for the disabled vets, senior citizens, and the surviving spouses and children who have lost loved ones in combat are too generous. For any senior citizen who is listening to this, the theory behind the chained CPI is the benefits that you have been getting are too generous. And whenever I say this in Vermont, people start laughing. They really do. And I have to say, No, they are not kidding, they are serious.
At a time when some think these benefits are too generous, we should understand that in 2 out of the last 4 years disabled vets and senior citizens did not receive any COLA at all, zero. So I guess a zero COLA is too generous. And this year's COLA of 1.7 percent is one of the lowest ever at a time when prescription drug costs for seniors are going up, health care costs for seniors are going up, heating costs in cold weather States such as mine are going up, food costs are going up. And yet seniors got a 1.7 percent COLA, and there are people who say that is much too generous.
Today, more than 3.2 million disabled vets receive disability compensation benefits from the VA and would be negatively impacted by the chained CPI. Are you really ready after all the great speeches we hear--speeches of thank you to the veterans who put their lives on the line, who gave their lives defending this country--do you really want to cut those benefits for those who lost their arms, their legs, their eyesight? I hope not.
Under the chained CPI, a disabled veteran who started receiving VA disability benefits at age 30 would have their benefits cut by more than $1,400 at age 45; $2,300 at age 55; and $3,200 at age 65. For our Wall Street friends, the people who make millions of dollars a year, that is not a lot of money. But for people who are trying to survive on $20,000, $25,000, $15,000 a year, that is a big hit. In my view, if you respect veterans and the sacrifices they have made, if you respect the ``greatest generation'' and what they have done to make this country great, you do not balance the budget on their backs.
Let me just conclude by saying I have been to Walter Reed, and I have seen what war has done to veterans. Many of my colleagues have done the same. In Vermont we paid a very heavy price for the Iraq war. I have been to too many funerals. I know many of my colleagues have done the same. I just ask that before we support this so-called chained CPI, which will make devastating cuts on the backs of disabled veterans and senior citizens, we remember the sacrifices those people made.
Let me ask unanimous consent to have printed letters in opposition to the chained CPI that I have received from the American Legion, Disabled American Veterans, Veterans of Foreign Wars and several other veterans organizations.
Let me quote from a letter I received from the National Commander of the American Legion, Jim Koutz, in opposition to the chained CPI:
On behalf of the 2.4 million members of The American Legion I voice our opposition to [the chained CPI] because of the harmful effects it will have on veterans' and Social Security benefits ..... Under the chained CPI, which cuts the formula used to determine the COLA for VA benefits, disabled veterans who receive this benefit would have their benefits reduced by thousands of dollars over their remaining lifetimes ..... The American Legion understands the need to restore fiscal discipline, but it should not be done by reneging on this country's promises to its veterans who already have earned these benefits through their service to country ..... For these veterans and their families, reducing the current COLA represents real sacrifice ..... We ask you not to do harm to those who have already sacrificed so much for this great nation.
I ask unanimous consent to include the American Legion letter in the Congressional Record.
Let me also quote a letter I received from the Executive Director of the Disabled American Veterans--DAV, Barry Jesinoski:
On behalf of all disabled veterans and their families, we stand with you in firm opposition to the application of the chained CPI to disability and pension payments for veterans, dependents and survivors of veterans. In recent years, it has become apparent that even the current COLA has failed to meet the rising costs faced by disabled veterans, their dependents and survivors. Lowering VA benefit payments using a new formula designed to reduce federal spending at large seems an unconscionable policy and would threaten their financial security and must be rejected. America's heroes deserve better from a grateful and caring nation.
I ask unanimous consent to print the DAV letter in the Congressional Record.
Let me also quote from a letter I received in opposition to the chained CPI from the Veterans of Foreign Wars, the Paralyzed Veterans of America, the Blinded Veterans Association, Gold Star Wives, the Iraq and Afghanistan Veterans of America, the Vietnam Veterans of America, and several other veterans' groups, in one letter. They came together and here is what this letter says:
As efforts to address our nation's debt continue, we are writing to express our opposition to changing the formula used to calculate the annual cost of living adjustment (COLA) because of the harmful effects it will have on veterans and Social Security benefits. We agree that political leaders need to restore fiscal discipline, but we believe it should be done with great care and without reneging on this country's promises to veterans, including the promises of Social Security and VA disability compensation and pension benefits--all of which are modest in size. Many veterans who rely on these programs live on fixed incomes and very tight budgets. For them, every dollar of hard-earned benefits counts in meeting basic expenses, attaining quality of life, and building a better future for themselves and those who depend on them. For many of them, reducing the annual COLA would mean real sacrifice. We ask that you not do that for those who have already sacrificed so much for this great country.
I ask unanimous consent that letter be printed in the Record.
So here we are. We are in this deficit situation because of wars that were unpaid for, tax breaks for the wealthiest people in this country, Medicare Part D not paid for, and a recession caused by Wall Street. Now we have folks who are saying we have a serious deficit problem. I agree.
The way we are doing it is to make devastating cuts on the backs of some of the most vulnerable people in this country, including disabled vets and including people who receive Social Security and disability benefits. I do not think that is the moral thing to do. I do not think that is the economically appropriate thing to do.
When you have one out of four major corporations, huge corporations, profitable corporations paying zero in taxes; when the corporate tax rate today, the effective corporate tax rate is the lowest it has been in decades; when the gap between the very wealthy and everybody else is growing wider; there are ways to do deficit reduction that are fair.
I will do everything I can to make sure that as we go forward with deficit reduction we do it in a way that is fair and not on the backs of some of the most vulnerable people in this country.
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Mr. SANDERS. I would like to thank Chairwoman Murray for including the request I made in the budget resolution to provide $2.2 billion in discretionary funding and $2.2 billion in mandatory funding for community health centers in fiscal year 2014.
I believe that community health centers are the answer we are looking for to make health care work for everyone, and I am very grateful for the language included in this Budget that recognizes the value of health centers.
As the Senator knows, since enactment of the Affordable Care Act, budget cuts have significantly reduced discretionary funding for the Community Health Center Program. Current service levels for the Community Health Center Program have been maintained only by redirection of the ACA's mandatory expansion funding--which is not authorized beyond the year 2015.
In other words, beginning in fiscal year 2016, the community health center fund will expire. Unless we find a solution to this problem, community health center funding will be reduced by 69 percent. If adequate funding is not restored, the result will be dramatic reductions in the number of patients community health centers are able to serve. I believe that would be a serious mistake.
Would the Senator be willing to work with me and other Senators on resolving the funding cliff facing health centers in 2016 so we don't have a massive cut facing such a valuable program?
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Mr. SANDERS. I thank the Chairwoman. The sooner we can work on this the better, as it will really give the program and all the centers across the country the stability and certainty they need to plan for the future.
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