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July 2, 2007

The End of Appropriations

Congressional Record
June 28, 2007

Rep. Frank Wolf [R-VA]: Mr. Chairman, in the interest of time, I am going to withdraw the amendment, but I would be remiss if I didn't take this opportunity to call to the attention the financial storm and the tsunami that is off the coast ready to hit our Nation.

Our Nation's Federal fiscal policy remains unsustainable, and in last Thursday's Washington Post, Comptroller General David Walker referred to what called to a "tsunami of spending" that will result in "very rough seas, like we've never seen before in this country."

If Congress is not proactive in addressing the mounting entitlement costs and fiscal outlook 30 years from now, we won't be here deciding how to spend discretionary funds in an appropriations bill, there won't be any money left for anything. In 2006, Medicare, Medicaid, Social Security, consumed 40 percent of the budget. That percentage will jump to 51 percent in 10 years, and there will be a devastating impact on the country.

In less than 20 years, there will be no money for student loans, transportation funding, national parks or cancer research or autism research, just to name a few.

More than $2.6 billion a day is needed to fund the savings shortfall, which has left us with nearly 40 percent of our GDP in foreign hands. The Saudis hold a lot of our debt, the Saudis hold a lot of our debt. The Chinese hold a lot of our debt.

On Tuesday, the Budget Committee held a hearing on foreign holdings of U.S. debt, and the vulnerability of our economy. The CBO director testified that increases in foreign holdings accounted for about 86 percent of total Federal borrowing last year.

We should care about that. We should care that the Saudis hold this debt, the Chinese that hold this debt. China is the largest single source of financing for the current U.S. account deficit. While the U.S. falls deeper and deeper into debt, other countries are saving. Although China usually gets most of the attention, it's also Saudi Arabia. Fifteen of the hijackers for 9/11 came from Saudi Arabia, Iran and Kuwait.

This amendment incorporate to expedite a national commission, eight members from each side to come together. This place is a partisan, political pit. There is no opportunity in this Congress to resolve these issues.

We can't even decide when we are going to adjourn around here sometimes. So what we take is eight Republicans, eight Democrats come together, put everything on the table. Everything has to be on the table, including tax policy.

This Commission would make recommendations and would hold public hearings around the country where the American people could have input. They will come back.

What makes this different than most others is that this would be like the base closing commission. It would require a vote to be taken by the Congress.

But 10 years from now, 20 years from now, when many of our people are going to be sitting on the rocking chair, having served in this Congress, and editorials and the newspaper headlines say "Nation in crisis," we are going to ask, what did we do?

I have written a number of Dear Colleague letters. We are up to 31 cosponsors, Members cosponsored this. We need eight Members from each side, everything on the table, recommendations would come back, require the Congress to vote. But for our children and for our grandchildren, I would ask that we do this.

Mr. Chairman, I would ask to include a Washington Post article by David Broder and also some other material in support of the idea.

Deficit Day of Reckoning

Next Monday is the real day of reckoning for President Bush and this new Democratic Congress. That is the day the president sends his budget for next year up to Capitol Hill, and you really will be able to judge by the reaction what will happen in Washington in the next 9 months.

Last year, when the budget came out, Democrats hooted in skepticism and many conservative Republicans expressed dismay at the size of the projected deficits. In the end, the House and Senate could not agree on a budget resolution, and the government went on autopilot in terms of domestic spending, continuing at the same level as the year before.

This year, as I learned from conversations with two senior White House officials last week, the president hopes his budget will become a starting point for serious negotiation--not a partisan football or simple laughingstock.

That hope was encouraged by a letter to the president last week from the Democratic leaders of the House and Senate, Rep. Nancy Pelosi and Sen. Harry M. Reid, and the chairmen of the two budget committees, Rep. John M. Spratt Jr. and Sen. Kent Conrad.

The first sentence said, "We are writing to express our strong interest in working cooperatively with you to address our Nation's fiscal challenges." It acknowledged that as the process unfolds, "Democrats and Republicans will disagree about particular priorities, and we will need to negotiate our differences in deciding how to allocate scarce resources."

But it put forward four principles that could lead to a successful budget outcome this year.

"The budget should account realistically for projected federal costs," including the billions needed for the wars in Iraq and Afghanistan and the adjustments needed in the alternative minimum tax, which otherwise would punish millions of middle-class families.

"The budget should realistically project short- and long-term deficits," as objectively as the calculations of the Congressional Budget Office, which show the prospect of very large deficits if current tax and spending policies are unchanged.

"The budget should provide detail throughout the entire budget period," making clear the hard choices that lie ahead.

"The budget should be based on fiscal discipline that is sustained over the long term," underlining the fact that it will take years of effort to repair the damage done to our fiscal condition in the past 6 years.

The House took an important first step in repairing our fiscal health last month by reimposing the "pay-go" rule, requiring any increase in entitlements or tax relief to be balanced with tax increases or spending cuts.

While not endorsing these specific principles, the White House officials with whom I met certainly pledged to make visible the costs of the war and to be specific about the trade-offs needed to maintain budget discipline, both in the short term and the long term.

They said that the economic assumptions underlying the president's budget are modest--if anything, an underestimate of the revenue likely to be produced by a growing economy. And the officials indicated that the president will recommend that, for a second year in a row, overall growth in discretionary domestic spending--the part separate from Medicare, Medicaid and Social Security--be held close to zero.

If Monday's budget fulfills those promises, the stage could be set for a serious effort to put the federal fiscal house in order.

But the warning voiced in an interview by Rep. David R. Obey of Wisconsin, the chairman of the House Appropriations Committee, must be borne in mind. Obey recalled that when the late Rep. Richard Bolling of Missouri invented the congressional budget process, he said, "It will work only if all the key players--in Congress and the administration--use honest figures and make a genuine effort to live within its discipline. Otherwise, the budget process will become a barrier to action."

If the congressional budget process breaks down, two Republicans, Rep. Frank R. Wolf of Virginia and Sen. George V. Voinovich of Ohio, have proposed a commission of legislators and experts to tackle the long-term budget challenges and bring back a plan that Congress would have to vote up or down, or substitute an equally effective blueprint.

One way or the other, this problem must be faced. Monday's budget message could be the first step.

National Debt

ISSUE: Comptroller warns of fiscal disaster.

The alarm clock is ringing. Time to wake up!

The "alarm clock" is David Walker, comptroller general of the United States and head of the Government Accountability Office. He's on a nationwide "Fiscal Wake-Up Tour," which he plans to continue through the 2008 elections.

His purpose is to warn Americans of the fiscal train wreck the Nation faces if it doesn't get its fiscal house in order. He's urging people to let the Federal government know they want something done about the problem.

That's crucial, because elected officials like to buy voter support with low taxes and big spending programs. That will never change unless the public lets its leaders know they can raise taxes and cut spending without being punished at the polls.

There's little choice. Things will grow exponentially worse as the Baby Boom generation begins collecting on entitlement programs. In the next few decades, the national debt, now at a record $8.8 trillion, could rise to more than $46 trillion.

Interest payments on a debt of that size would consume every cent the Federal government currently collects in taxes. It's conceivable that little or nothing would be left for national defense, roads and other infrastructure, entitlement programs, environmental initiatives, etc. The Nation can't operate that way.

Fortunately, Walker has help. He's accompanied on his tour by bipartisan representatives of leading think tanks, and recently U.S. Rep. Frank Wolf, R-Va., filed legislation to create a bipartisan commission to tackle the problem. Everything would be on the table, from taxes to entitlement spending. The bill would require Congress to vote on the commission's recommendations in their entirety.

If you want your country to remain strong and prosperous, let your members of Congress know you support this legislation. Self-indulgence got us into this mess. Only self-discipline can get us out.

BOTTOM LINE: The United States must attack this problem now, before it bankrupts the Nation.

Mr. Chairman, I withdraw my amendment.

Chair: Without objection, the amendment is withdrawn.

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