May 14, 1975
Page 14272
FIRST CONCURRENT RESOLUTION ON THE BUDGET – FISCAL YEAR 1976 – CONFERENCE REPORT
The PRESIDENT pro tempore. Under the previous order, the Senate will now proceed to the consideration of the conference report on House Concurrent Resolution 218, which the clerk will report.
The assistant legislative clerk read as follows:
The committee of conference on the disagreeing votes of the two Houses on the amendment of the Senate to the bill (H. Con. Res. 218), setting forth, on an aggregate basis only, the congressional budget for the United States Government for the fiscal year 1976.
Mr. MUSKIE. Mr. President, I ask unanimous consent that the following members of the staff of the Committee on the Budget be granted the privilege of the floor during the consideration and votes on the conference report on House Concurrent Resolution 218: Douglas Bennet, John McEvoy, Arnold Packer, Sid Brown, Robert Boyd, Franklin Jones, David Blackburn, Bruce Thompson, Bill Stringer.
The PRESIDENT pro tempore. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, I ask unanimous consent that the vote on the conference report take place by 12:30 p.m., immediately prior to the vote on the Johnston amendment to the bill S. 200.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, I ask unanimous consent that the text of the conference report be printed in the RECORD at this point.
There being no objection, the conference report was ordered to be printed in the RECORD, as follows:
CONFERENCE REPORT (S. REPT. No. 94-113)
The committee of conference on the disagreeing votes of the two Houses on the amendment of the Senate to the concurrent resolution (H. Con. Res. 218) setting forth, on an aggregate basis only, the congressional budget for the United States Government for the fiscal year 1976, having met, after full and free conference, have agreed to recommend and do recommend to their respective Houses as follows:
That the House recede from its disagreement to the amendment of the Senate and agree to the same with an amendment as follows: In lieu of the matter proposed to be inserted by the Senate amendment insert the following:
That the Congress hereby determines, pursuant to section 301(a) of the Congressional Budget Act of 1974, that for the fiscal year beginning on July 1, 1975–
(1) the appropriate level of total budget outlays is $367,000,000,000;
(2) the appropriate level of total new budget authority us $395,800,000,000;
(3) the amount of the deficit in the budget which is appropriate in the light of economic conditions and all other relevant factors us $68,820,000,000;
(4) the recommended level of Federal revenues us $298,180,000,000, and the amount by which the aggregate level of Federal revenues should be decreased is $3,400,000,000; and
(5) the appropriate level of the public debt is $617,600,000,000, and the amount by which the temporary statutory limit on such debt should accordingly be increased is $86,600,000,000.
And the Senate agree to the same.
EDMUND S. MUSKIE, WARREN MAGNUSON, FRANK MOSS, W. F. MONDALE, ERNEST F. HOLLINGS, ALAN CRANSTON, HENRY BELLMON, ROBERT DOLE, J. GLENN BEALL, Jr., PETE V. DOMENICI,
Managers on the Part of the Senate.
BROCK ADAMS, JIM WRIGHT, THOMAS L. ASHLEY, ROBERT N. GIAIMO, NEAL SMITH,:JAMES G. O'HARA, SAM GIBBONS, PARREN J. MITCHELL, BUTLER DERRICK,
Managers on the Part of the Houses
JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE
The managers on the part of the House and the Senate at the conference on the disagreeing votes of the two Houses on the amendment of the Senate to the concurrent resolution (H. Con. Res. 218) setting forth on an aggregate basis only, the congressional budget for the United States Government for the fiscal year 1976, submit the following joint statement to the House and the Senate in explanation of the effect of the action agreed upon by the managers and recommended in the accompanying conference report:
OUTLAYS
The House resolution provided for total outlays in the amount of $368.213 billion, The Senate amendment provided for outlays in the amount of $365 billion. The conference report provides for total outlays in the amount of $367 billion.
BUDGET AUTHORITY
The House resolution provided for total new budget authority in the amount of $395.938 billion. The Senate amendment provided for new budget authority in the amount of $388.6 billion. The conference report provides for total new budget authority in the amount of $395.8 billion.
DEFICIT
The House resolution provided for a budget deficit in the amount of $70,032 billion. The Senate amendment provided for a deficit in the amount of $67.2 billion. The conference report provides for a budget deficit in the amount of $68.8 billion.
REVENUES
The House resolution provided for Federal revenues in the amount of $298.181 billion; and, to achieve that level, it provided that revenues should be decreased by $4.4 billion. The Senate amendment provided for Federal revenues in the amount of $297.8 billion. The conference report provides for Federal revenues in the amount of $293.180 billion; and, to achieve that level, provides that revenues should be decreased by $3.4 billion.
The conference substitute (1) accepts the House assumption that major provisions of the Tax Reduction Act scheduled to expire December 31, 1975, will be extended by the Congress, lowering revenues by $4.4 billion: (2) accepts the House position with respect to raising additional revenues through enactment of tax reform legislation, but reduces from $3 bullion to $1 billion the amount to be realized in Fiscal Year 1976; and (3) assumes that, as a result of recent tax collection experience, an additional $2 billion in revenues will be received during Fiscal Year 1976.
PUBLIC DEBT
The House resolution provided for a public debt level of $619.9 billion; and to achieve that level, provided that the temporary statutory limit on the public debt should be increased by $88.9 billion. The Senate amendment provided for a public debt level of $617.6 billion. The conference report provides for a public debt level of $617.6 billion; and that, to achieve that level, the temporary statutory limit on the public debt should be increased by $86.6 billion.
FUNCTIONAL CATEGORIES
The aggregate budget figures in the report represent the best judgment of the managers as to the appropriate levels of spending and income for fiscal 1976. That judgment could change if economic conditions change significantly between May and September, when the Senate and House Budget Committees will submit a Second Concurrent Resolution to set aggregate ceilings for fiscal 1976.
The functional category figures in this report are intended to serve as guidelines the Congress, to explain the steps by which the conference reached the aggregate sums and to provide a benchmark for the Second Concurrent Resolution. The estimates of the managers for budget authority and outlays in each functional category are as follows:
National defense (050)
The House Resolution assumes budget authority of $100.5 billion and outlays of $90.2 billion.
The Senate amendment assumes budget authority of $101.0 billion and outlays of 91.2 billion.
The Conference substitute assumes $100.7 budget authority and $90.7 in outlays. This is an increase of $0.2 billion in budget authority and $0.5 billion in outlays above the House amounts and a decrease of $0.3 outlays in budget authority a and $0.5 billion outlays below the Senate amounts. In arriving at these amounts, the managers considered and agreed to the following:
(a) If Congress should decide not to limit increases in defense salaries and retirement allowances, there are sufficient funds within this total to support that decision.
(b) All funds requested for military assistance to Southeast Asia were deleted from fiscal 1976 estimates, including the outlay effect of the 1975 supplemental request.
(c) The balance of the reductions are the result of revised inflation estimates, reductions in program growth, and financial adjustments.
International affairs (150)
The House Resolution assumes budget authority of $4.7 billion and outlays of $5.0 billion.
The Senate Resolution assumes budget authority of $6.0 billion and outlays of $4.9 billion.
The Conference substitute allows $0.2 billion in budget authority for the Special Financing Facility and assumes that the estimate for foreign economic assistance will be reduced by $0.9 billion in budget authority and $0.4 billion in outlays below the budget submitted.
The managers agreed to the House level for foreign economic assistance, assuming major reductions in Indochina postwar reconstruction. The managers also agreed that token budget authority should be provided for the Special Financing Facility to indicate the Congress anticipates a legislative proposal for this purpose.
General science, space and technology (250)
The House Resolution assumes budget authority of $4.7 billion and outlays of $4.6 billion.
The Senate amendment assumes budget authority of $4.7 billion and outlays of $4.6 billion.
The House and Senate estimates were substantially the same. The managers agreed to the Senate's figures.
Natural resources, environment and energy (300)
The House Resolution assumes budget authority of $14.1 billion and outlays of $11.5 billion.
The Senate amendment assumes budget authority of $13.4 billion and outlays of $11.7 billion.
The Conference agreed to budget authority $13.8 billion, and outlays of $11.6 billion.
Agriculture (350)
The House Resolution assumes budget authority of $4.3 billion and outlays of $1.8
The Senate amendment assumes budget authority of $4.3 billion and outlays of $2.0 billion.
The Conference agreed to the House estimates. By this action the Conference does not either include or exclude outlays for the farm bill recently vetoed, because the conferees assume that outlays in fiscal 1976 will be minimal if that bill or a similar bill becomes law.
Commerce and transportation (400)
The House resolution assumes budget authority of $11.0 billion and outlays of $18.5 billion.
The Senate amendment assumes budget authority of $9.5 billion and outlays of $16.6 billion.
The conference substitute assumes $11.3 billion in budget authority and $17.5 billion in outlays.
The estimates include a total of $0.8 billion in outlays for small business, postal service and rail rehabilitation projects now being considered by the House-Senate conference on the Emergency Employment Appropriations Act of 1975. The estimates also contain $3.3 billion in budget authority to continue advance highway apportionments and $6.3 billion in highway outlays.
Outlays of $0.4 billion are provided for housing legislation expected to pass in fiscal 1975.
Funding for other rail improvement projects recommended by the Senate is included, with $600 million in budget authority and outlays. Other items include additions to the Administration's budget of $0.2 billion in budget authority and outlays for the Washington Metro; $0.2 billion in budget authority and outlays for Postal Service subsidies; and $0.3 billion in budget authority and $0.2 billion in outlays for additional small business loans.
Community and regional development (450)
The House resolution assumes budget authority of $10.8 billion and outlays of $9.0 billion.
The Senate amendment assumes budget authority of $6.0 billion and outlays of $6.6 billion.
The conference substitute assumes $11.0 billion in budget authority and $8.65 billion in outlays.
The House resolution assumes $5.0 billion in budget authority and $2.5 billion in outlays for accelerated public works programs. The Senate amendment did not include this assumption. Since the accelerated public works program is intended to provide economic stimulus, the Conference agreed to retain the House budget authority estimate and an outlay estimate of approximately $2.1 billion to be available either for an accelerated public works program or some other appropriate stimulative program that Congress may decide to enact, such as emergency financial assistance to state and local governments.
Education, Manpower and Social Services (500)
The House resolution assumes budget authority of $19.0 billion and outlays of $20.4 billion.
The Senate amendment assumes budget authority of $20.7 billion and outlays of $19.4 billion.
The conferees agree to budget authority of $19.0 billion and outlays of $19.85 billion in this function. These figures assume that all programs in this function can be funded at least at their fiscal year 1975 funding level, the regular ongoing programs be increased, and that the number of public service employment jobs also be increased. The conferees reached a decision to add $0.45 billion to the $3.1 billion already in this function for public service jobs in view of the job-creating effect of the $0.6 billion assumed in function 400 for rail assistance.
Health (550)
The House resolution assumes budget authority of $33.1 billion and outlays of $30.7 billion.
The Senate amendment assumes budget authority of $32.6 billion and outlays of $31.0 billion.
The Conferees agreed to the House figures.
Income security (600)
The House resolution assumes budget authority of $141.3 billion and outlays of $124.9 billion.
The Senate amendment assumes budget authority of $138.5 billion and outlays of $126.1 billion.
The conferees agreed to budget authority of $140.9 billion and outlays of $125.3 billion in this function. This total includes $0.8 billion for the extension of emergency benefits for insured
unemployed for an additional 13 weeks. It also assumes savings in fiscal year 1976 through legislative and administrative improvements in programs such as food stamps, aid to families with dependent children, and social security.
The managers intend that there be no cap on benefit increases as proposed in the President's budget. The managers intend that the resolution provide sufficient funds to extend both emergency benefits for the insured unemployed and also special unemployment assistance for the uninsured unemployed.
Veterans benefits and services (700)
The House Resolution assumes budget authority of $18.0 billion and outlays of $17.5 billion.
The Senate amendment assumes budget authority of $17.6 billion and outlays of $16.9 billion.
The Conference agreed to the House assumptions of $18.0 billion in budget authority and $17.5 billion in outlays for this function. The managers on the part of the Senate agreed to these figures because of the probability that Congress will reject Administration proposals to reduce the eligibility period for veterans' readjustment benefits and to require reimbursement from private health insurers for VA health care. The Senate amendment did not assume increases in budget authority and outlays for either. The House assumed $0.7 billion in budget authority and outlays for these probable expenditures to which the conferees agreed.
Law enforcement and justice (750)
The House resolution assumes budget authority of $3.3 billion and outlays of $3.4 billion.
The Senate amendment assumes budget authority of $3.3 billion and outlays of $3.4 billion.
The Conference agreed to the House figures.
General government (800)
The House resolution assumes budget authority of $3.3 billion and outlays of $3.4 billion.
The Senate amendment assumes budget authority of $3.3 billion and outlays of $3.2 billion.
The conference committee agreed to $3.3 billion in budget authority, the same as the House and Senate estimates, but to $3.3 billion in outlays, $50 million below the House assumption and $100 million above the Senate assumption.
Revenue sharing and general purpose fiscal assistance (850)
The House resolution assumes budget authority of $7.3 billion and outlays of $7.2 billion.
The Senate amendment assumes budget authority of $7.3 billion and outlays of $7.2 billion.
Essentially, the assumptions of both houses were the same for this function, but the conference committee agreed to round out the House estimate to the nearest tenth of a billion dollars.
Interest (900)
The House resolution assumes budget authority of $35.0 billion and outlays of $35.0 billion.
The Senate amendment assumes budget authority of $35.8 billion and outlays of $35.3 billion.
The Conference substitute provides $35.0 billion in budget authority and outlays, the same as the House estimate and $0.3 billion lower than the Senate estimate.
Allowances
The House resolution assumes budget authority of $1.7 billion and outlays of $1.5 billion.
The Senate amendment assumes budget authority of $1.3 billion and outlays of $1.1 billion.
The Conference agreed to $1.4 billion in budget authority and $1.2 billion in outlays.
The conferees assume that the levels agreed upon are sufficient to cover civilian agency pay raises under existing law and outlays that may be required for humanitarian assistance for Indochina refugees, as well as other contingencies.
Undistributed offsetting receipts (950)
The House resolution assumes budget authority of $16.2 billion and outlays of $16.2 billion.
The Senate amendment assumes identical amounts.
The conference substitute accepts the Senate estimate.
Both the House resolution and the Senate amendment assumed $4.0 billion in receipts from leases of mineral rights on the Outer Continental Shelf, rather than $8.0 billion estimated by the Administration.
EDMUND S. MUSKIE, WARREN MAGNUSON, FRANK MOSS, W. F. MONDALE, ERNEST F. HOLLINGS, ALAN CRANSTON, HENRY BELLMON, ROBERT DOLE,
J. GLENN BEALL Jr., PETE V. DOMENICI,
Managers on the Part of the Senate.
BROCK ADAMS, JIM WRIGHT, THOMAS L. ASHLEY, ROBERT N. GIAIMO, NEAL SMITH, JAMES G. O’HARA, SAM GIBBONS, PARREN J. MITCHELL, BUTLER DERRICK,
Managers on the Part of the House.
Mr. MUSKIE. Mr. President, today, we ask the Senate to take one more step in the process of improving congressional management of the Federal budget. The Senate has before it the conference report on the first concurrent resolution on the budget for fiscal 1976. I urge Senate approval of the report.
Before getting into details on the report, I want to say that so far the new process is working precisely the way those of us who helped write the Congressional Budget and Impoundment Control Act thought it should. It also is working more smoothly than many of us had any right to expect it would this early in its career.
As a result, we have before us a budget that is tailored to the needs of the economy. And we have before us a budget which has been written in the open, with every detail subject to public examination and debate. There is no mystery about how it was put together and why it calls for the spending patterns it recommends.
As the act requires, the managers of the conference have agreed upon a combination of revenue and outlays which have been chosen with care to meet the needs of a nation and its people during the worst recession in more than 30 years. We are persuaded that the target for outlays of $367 billion will help stimulate the economy and put Americans back to work without generating new inflationary pressures.
We have agreed upon a pattern of spending that gives highest priority to those programs which get Americans back to work and help them in other ways to weather this recession.
During the course of the conference, some major amounts of money were moved among the functional categories. In every case, the reason for the move was to provide a maximum amount of spending for anti-recession programs and to keep increases in the base of permanent, long-range spending to a minimum.
Thus, the conference managers have increased the amount of money that will create new jobs. They have balanced those increases with cuts in programs where spending can be deferred without leading to a loss of jobs. And they present these changes with unanimous support. All 10 managers for the Senate have signed the report.
When we brought the first concurrent resolution before the Senate last month, I said that the Federal budget is more than an exercise in cost-accounting. It is an annual affirmation of national hopes and goals. It is couched in terms of dollars, but its real meaning is in the purpose for which those dollars are spent – in the education of children, the defense of the Nation, and the support of retired workers.
Today, however, I will concentrate on the numbers, on accounting for the changes which the conference recommends in the budget ceilings and revenue estimates which the Senate and House approved on May 1.
One change is in the revenue recommendations. The Senate recommended revenues of $297.8 billion in its resolution. The conference managers recommend a higher revenue estimate of $298.2 billion, based on three factors:
First. Congress probably will extend major provisions of the Tax Reduction Act of 1975 into next year;
Second. The revenues for fiscal 1976 probably will be at least $2 billion higher than the Treasury Department originally calculated them to be; and
Third. Congress will enact tax reforms that will produce about $1 billion in additional revenues during fiscal 1976. The House resolution was amended on the House floor to recommend tax reforms to produce $3 billion in new revenues, with a majority of the members of the Ways and Means Committee supporting the amendment. The Senate did not assume any tax reform in its resolution.
The conference also recommends a change in the target ceiling for outlays to $367 billion, which is $2 billion higher than the ceiling approved by the Senate and $1.2 billion lower than the ceiling set by the House. All of the increase above the original Senate resolution outlay figure would go to job-creating temporary programs.
The combination of the revenue and outlay recommendations would produce a fiscal 1976 deficit of $68.8 billion – somewhat higher than the Senate figure; somewhat lower than the House figure. However, the conference deficit figure assumes an extension of the Tax Reduction Act, which was not included in the Senate resolution. This will reduce revenues by an estimated $4.4, billion in fiscal year 1976.
The most important change in the conference budget proposal is in the increase in funds that would be direct into temporary recovery.
The House approved about $9 billion for public works and other temporary job-creating programs. The Senate approved $4.5 billion for similar temporary recovery spending. The conference recommends temporary recovery spending of $7.5 billion.
The higher figure is closer to my personal preference. I wanted to allocate more than $4.5 billion to temporary creating programs but that was not the will of the Budget Committee or of the
Senate.
The higher figure is possible, in part, because the revised estimate of revenue which was made after the Senate approved the first concurrent resolution. It is also is possible because the conference agreed to a tighter ceiling on defense spending than that which the Senate approved.
The higher level of spending for job-creating programs are divided among the functions of commerce and transportation, community and regional development and education, manpower and social services.
The conferees left open the question of how some $2 billion of the temporary recovery money would be spent. It could take the form of public works projects or it would be used for emergency help for State and local governments, many of which have been hard hit by both recession and inflation.
Without emergency help, many cities in this country will be forced to make a choice between raising taxes and cutting services or postponing major projects, either of which would run directly counter to the Federal Government's efforts to stimulate the economy.
Finally, these increases in funds for job-creating programs made it possible to reduce recommended outlays for unemployment insurance by nearly $1 billion below the original Senate figure.
The Congressional Budget Act requires the Senate to consider and report a second concurrent resolution on the budget in September. If economic conditions have changed significantly by then, Congress will want to change its outlay and deficit figures to meet the new situation.
As part of our preparation for that resolution, I have asked the Director of the Congressional Budget Office to prepare two reports on the Nation's economy, one for delivery on June 30 and the second on August 15. Those reports should help tell us whether the assumptions we have made about the behavior of the economy in the weeks ahead are correct and whether the policies we have adopted are valid.
I have asked Ms. Rivlin also to analyze the temporary recovery programs envisioned in this budget resolution and to prepare a report on various approaches Congress might take to launching such programs when they are needed and withdrawing them when stimulus is no longer appropriate. Ms. Rivlin advises me that she has begun her analysis and that she will report to Congress by August 15 on experiences with such temporary programs both in the United States and abroad.
Now the question remains: What are we going to do with these numbers during the summer?
When we are voting on the second and binding resolution in September, will these targets be more or less intact? Will our self-discipline have worked?
Success really will be a measure of self-discipline, because neither I nor the other Members of the Budget Committee has the power to enforce these totals. We will be happy to work with all committees as their legislation goes forward to explain how these targets were achieved. The Congressional Budget Office is establishing an advisory monitoring system which will give us an understandable tally sheet on a very regular basis showing what we have already spent, what seems likely to come to the floor, and how much room there is left beneath the targets. But the decision to vote "yea" or "nay" for this spending bill or that will be up to the individual members, as it always has been.
Applying the first concurrent resolution will not be easy, but neither have any of the other steps we have taken to date in this new process. The objective of fiscal responsibility remains valid, however, and I believe we now know it is achievable. We can emerge in September with a success far beyond what the skeptics ever envisioned for the first year of this new process.
Congress also must prepare for a so-called "transition quarter" which will occur from July 1 to September 30, 1976, during the shift to the new October 1 fiscal year under the terms of the Congressional Budget Act. Due to the press of time, neither the Senate nor the House Budget Committee has been able to include the transition quarter in its deliberation on this first concurrent resolution. I think it is fair to say, however, that both budget committees will agree that our approach to this interim period should be one of restraint. Activities of the Federal Government must, of course, be maintained at necessary levels, but new program initiatives clearly should be deferred until fiscal year 1977, which begins on October 1, 1976, wherever possible.
Mr. President, I submit that this conference report is one of the most important pieces of legislation to be presented to the Senate in many years.
The choices will not be easy. Many legitimate demands will have to be deferred. But with this budget proposal as a guideline, I believe we can meet the most urgent needs of Americans and, at the same time, restore their confidence in the Nation's economic future.
Mr. President, I urge the Senate's support of the conference report.
At this point, I express my appreciation again to the distinguished Senator from Oklahoma (Mr. BELLMON), the ranking Republican on the Senate Committee on the Budget. In the deliberations of the Committee on the Budget and on the Senate floor, he was a staunch supporter of our efforts in protecting the Senate position in conference. He attended every moment of those deliberations, which I think, on the whole, were constructive if, at times, reflecting vigorous dissent between the House and Senate conferees. Once again, I say "thank you" to Senator BELLMON and yield to him at this point.