December 15, 1975
Page 40477
SENATOR MUSKIE'S CONCEPT OF THE NEW BUDGET PROCESS AND THE ROLE OF CONGRESS IN THAT PROCESS
Mr. MANSFIELD. Mr. President, I have reviewed the transcript of the proceedings of last Thursday's meeting of the majority conference.
I was most impressed by the remarks of Senator MUSKIE at that conference. As the chairman of the Budget Committee he displayed a fine grasp of the new budget process and the responsibilities of the Congress with regard to that process. For the benefit of all Senators I commend these remarks of Senator Muskie and ask unanimous consent that they be printed in the RECORD.
There being no objection, the remarks were ordered to be printed in the RECORD, as follows:
REMARKS OF SENATOR EDMUND S. MUSKIE
I would like to make a couple of observations to begin with. I have lived through many of these confrontations between the President and the Congress which were provoked by attempts to set arbitrary spending ceilings. They rarely worked. They always resulted in acrimony and bitterness, in no results. They resulted finally in the impoundment scenario of 1973–74 which resolved nothing. The budget process was created as a result of the failure the last time the President tried to set an arbitrary spending ceiling. So there is that history.
Secondly, and I cannot resist this, with respect to looking ahead a year or two to determine what your spending cuts ought to be, I have two illustrations.
A year ago this President announced that he was going to recommend a balanced budget for fiscal 1976. This was in October 1974. Five months later, in February, he sent his budget to the Hill and it was in the hole $52 billion. He was not able to look ahead 5 months at that time. His own latest figure on the deficit for this year is about $68 billion. So that is the margin of error with which he has worked.
Another point: Since his last budget review for this year, which takes place about June 1, his own budget has gone up $8.6 billion because of uncontrollables which were not accurately estimated June 1. This is December and he was off by $8.9 billion just on that part of the budget in less than 6 months.
Let's look at his proposal. First of all, he proposed cutting $28 billion. How did he arrive at that? First, he projected outlays or potential outlays of $423 billion for the next fiscal year. Where did he get it? I have been unable to find out.
Under the Budget Act he is required now to send up a current services budget in November. This pamphlet contains that. Is the $423 billion in here? The answer is no.
We projected four different sets of economic assumptions in order to give us not one number on outlays but four, from the most optimistic economic assumptions to the least optimistic.
The range of his outlay numbers is from $410 billion to $414 billion. So the highest number is $9 billion below the $423 billion which was the basis for his $28 billion in cuts.
We do not know the makeup of the $423 billion at all. He has not sent it to us. This pamphlet was printed after he made his proposal. The $423 billion is not in here, nor is the basis for it. The justification for it is not in here.
Then how about the $28 billion in cuts? If he does not have $423 billion in outlays and his proposed spending ceiling is $395 billion, then is he proposing cuts of $15 billion or $19 billion or $28 billion? He has not made that clear. He said that the number is $395 billion, but he has not told us how that relates to an outlay figure.
As to the $28 billion, what does that consist of? He did not tell us at the time. Since that time, the Budget Committee has had extensive hearings with Mr. Lynn, with Mr. Simon, with Mr. Burns, and we did our best to solicit from them the details of the $28 billion in cuts. We still have not received them.
If the administration in a 2-month period has not been able to make up its own mind, its collective mind, as to what the cuts are, where they ought to be, it is a little difficult for us to get a handle on them.
So we are talking about a $423 billion outlay figure that is a complete phantom, that is not found anywhere except in the President's speech of that night. Nowhere else have we found it.
Secondly, we are talking about a $28 billion cut which is not substantiated in any way whatsoever. The OMB leaks pretty well from time to time. We have not had even a leak as to the composition of that $28 billion in cuts. Now we are asked to establish an outlay ceiling of $395 billion.
As Russell says, that may be a figure that we agree upon.
What have we done as a Congress? We have prided ourselves, and I think justifiably, that we have at least set in motion a process which would lead us to fiscal responsibility and budgetary prudence. I think the case is pretty good on that score, but history will judge better. In any case, what we are about to put in place for this fiscal year, in accordance with the law that we enacted over a year ago, in accordance with the law which administration witnesses have applauded to the skies, what we are about to put into place when we act on the second concurrent resolution this week — and I expect it will be this week — is this: An extension of the tax cuts we enacted into law this year, and that number is a result of a deliberate, rational process of discussion which has included the Finance Committee, the Ways and Means Committee, the Budget Committees of both Houses, and the Senate and the House of Representatives.
That number is not a figure picked out of the air. On our side, it is based upon the testimony we have received from economists across the board, liberal, conservative, Keynesian, monetarists, and what have you. That figure made sense as against the higher cut that the President is proposing.
We considered the higher cut. We got almost no testimony in support of it. This cut was the sensible one. Its purpose was simply to avoid the drop in withholding rates which would have the effect of impacting upon every individual taxpayer. So that $6.4 is a hard number and nobody in the Budget Committee on our side, nobody on the floor of the Senate on our side, offered any amendments to change it. If there was a presidential spokesman on the floor of the Senate, he did not raise his voice. If there was one in the Budget Committee, he did not raise his voice. So that $6.4 billion in tax cuts is firmly based upon a considered judgment of the Congress of the United States. We have a right to make that. The Constitution says we have the power of the purse. We have the sole power to raise revenues. That is our decision, and I think we ought to make it stick, frankly.
Second, when we approve the second concurrent resolution this week, we will be putting firmly into place a ceiling for outlays in this fiscal year that will subject anything that breaches the ceiling to a point of order, the toughest kind of discipline that the Congress has ever adopted with respect to spending legislation, a ceiling at $375 billion.
There are those who would like to see it lower; there are those who would like to see it higher. But that also was the result of a kind of process which has made it possible for us to bring 535 different human beings in the Congress of the United States into agreement on what the national interest requires by way of outlays for this fiscal year.
And may I say, incidentally, if you compare that with the President's, using common assumptions about sales of Outer Continental Shelf oil leases, about other kinds of common things that are not going to change, we are pretty close to the President's numbers for this fiscal year. We are going to put it in place and enforce it for the next 6 months with a point of order to strike at anything that breaches that ceiling.
That, to me, is a demonstration of fiscal responsibility to the country that the country should take some assurance from and that this administration ought to take some assurance from. What they want to do is to completely torpedo it. They want to take it back to the pre-budget process days when they laid down the mandate and we had no chance to look at it.
We will set a ceiling for 1977 next May 15 that is mandated by law, a law signed by the President of the United States. That is the date that we agreed between us should be the date for setting a spending ceiling.
Why we should let the President, for his own political purposes, change that law, modify it unilaterally, bludgeon us into changing, is beyond any conception I have of what the will of Congress may be.
So I say to my colleagues, I don't think the other option is available to us. I think we have only one — to enforce the policy that we have taken a year to put into place, and to challenge the President who would undermine this budgetary process from which the country is taking a great deal of assurance and growing confidence in the public policy-making of this country.
I hope we have a unanimous vote in this Congress to support Russell, and specifically, I think all the budget resolution does is assume revenues until July 1. So if Russell's bill extends the tax cuts only until July 1, that fits us. It also fits the May 15 date for setting an outlay ceiling. So all of it goes together.
May I say when we finally act on both of these things, we will have acted 4 months in advance of the beginning of the fiscal year for which the President is arguing, and that is not bad.