Muskie Congressional Record: Tax Rebate 5

CONGRESSIONAL RECORD — SENATE

April 21, 1977

Page 11737

Mr. MUSKIE and Mr. HASKELL addressed the Chair.

The PRESIDING OFFICER. The Senator from Maine.

Mr. MUSKIE. Mr. President, if I might have the attention of our colleagues for about 30 seconds.

The PRESIDING OFFICER. Will the Senate be in order?

Mr. MUSKIE. I shall make an observation about this bill from the point of view of the budget. Senators ought to bear in mind as we proceed the effect of the vote that we just took was to add $2 billion to the 1978 deficit which is projected in the first concurrent resolution for 1978, which is at the desk, so votes like this have the effect of increasing the deficit for a budget resolution we have not yet considered.

Any other tax reductions in addition to those in this bill which carry over to 1978 will add to that deficit. It is the prerogative of the Senate to do that. But I think it ought not to be done blindly. I wish Senators to understand that is the effect, and it may well be that we may have to take the budget resolution back to committee if the results of our actions on this bill accumulate the deficit. When I say this I am not being critical of any Senator's vote on the issue we have just considered. But there are budget implications, and I think Senators ought to know what they are. That is all I wanted to say while a number of Senators are in the Chamber.

Mr. LONG. Mr. President, I shall respond for a moment to the admonition of the chairman of the Budget Committee while Senators are here.

It has been my experience that when the chairman of the Budget Committee favors an amendment the budget problem is never a problem. If it puts us $50 billion in the red — $20 billion, not $50 billion — $20 billion in the red that is something that can be accommodated. But if the chairman is against the amendment, if it costs 5 cents that is going to bankrupt the country.

We recall the experience that we had when we were voting on the Tax Reform Act last year. We were admonished, admonished, and admonished that the Tax Reform Act was going to bankrupt the country, because we were told that it was unrealistic to assume that Congress would ever dare to bring an end to those temporary tax cuts including the $35 tax credit. The reason it was unrealistic so soon was that the chairman of the Budget Committee led the charge to knock out the part that would balance the bill, so that having led the charge to knock out the part that would bring to an end the temporary tax cuts, he made it unrealistic to assume that that would be a balanced bill. Then the chairman himself—

Mr. MUSKIE. Mr. President, will the Senator yield?

Mr. LONG. I will yield in a moment.

Then the chairman himself, as well as members of his committee, proceeded to vote for amendment after amendment on that bill that made that a further unbalanced bill to the extent that when the bill was finally voted on as chairman of the committee I offered an amendment to save it that said to the Senate that we ought to try to bring back confidence to a bill that pretty well balanced things out as far as we could. That is what we did do.

So the budget balancing, after all that conversation about ending the budget process, was done in the same old traditional fashion, by the conferees from the Senate, the senior members of the Finance Committee, going to conference with their counterparts from the House Ways and Means Committee to try to work things out the best they could, to meet all the budgetary problems one might anticipate and consider.

We are now in a $10 billion better position than we were, by the administration's own bookkeeping — a $10 billion better position than we were when the chairman was advocating that we vote for the $50 tax rebate, which would have cost $11 billion. So we are $21 billion better off than the chairman anticipated we were going to be. I know he is concerned about 1978, but I would urge him to realize that there are some of us in addition to the chairman who are interested in seeing that this Nation remains fiscally solvent, and we are going to work toward that end. But when you try to tell a Senator he cannot offer an amendment here, that is something this Senator cannot prevent any more than the chairman of the Budget Committee can prevent it.

Mr. MUSKIE Mr. President, will the Senator yield?

Mr. LONG. Yes.

Mr. MUSKIE. I do not know what I did to enrage the Senator from Louisiana. All I did was state a simple fact, and as I see it, I have a duty as chairman of the Budget Committee to state facts. I do not try to restrain anyone from offering an amendment, but let the facts speak for themselves.

I do not intend to get into another hassle with the chairman of the Finance Committee over what we did last year. I think the Senator has confused his history a little bit, but that is his prerogative.

All I am saying is that in the budget resolution that is not more than 2 weeks old, we had a deficit projected in that budget resolution of $63.2 billion, and that according to the same computation, the addition of the investment tax credit and the job tax credit in this bill would add $2 billion to that deficit.

That is a simple statement of fact. Now, with respect to the $10 billion figure which the President used a week and a half ago to justify the $50 tax rebate, let me say to the Senate as a whole what I said earlier to the distinguished chairman of the Finance Committee when he made the same point, when only four of us were on this floor: The fact is that in fiscal year 1976, with the best estimating that OMB, CBO, and the Budget Committees could make, actual spending in fiscal year 1976 was less than the spending we had projected. The same thing happened in the transition quarter. The same thing happened in this fiscal year in October, November, December, January, and February.

But it turned around in March. There is no basis for anybody to conclude that as of October 1, spending for this year will be $10 billion less than the spending that we projected in the Third Concurrent Budget Resolution which Congress adopted in February. If it is, I would think the taxpayers would be grateful. I do not think the taxpayers would be grateful it we assume that there is $10 billion in that budget that will not otherwise be spent, that we can begin spending now. What we may then face on October 1 is the disappearance of that $10 billion and the addition of additional deficits, because we rationalized with every spending bill or every revenue bill that last month's spending was not up to snuff.

That is the old method. That is the old method that I remember so well. When spending bills come to the floor—

Mr. LONG. Mr. President, who has the floor?

Mr. MUSKIE. Spending bills come to the floor, and the Senator says, "This is all right, this is within the budget."

How did we write the budget? Bill by bill by bill.

The PRESIDING OFFICER. The Senator from Louisiana has the floor.

Mr. MUSKIE. I am sorry I cannot finish my thought.

Mr. LONG. Mr. President, I would like to finish my statement; then the Senator can have the floor as far as I am concerned. I just want to finish my part of it.

As it stands now, by the administration's estimate, we have $7 billion more money on hand, that has not been spent, than had been anticipated. We have $3 billion more in revenues than had been anticipated. That makes us $10 billion better off.

For the fiscal year we are in, we also have the benefit of the fact that the $50 rebate has been removed. That is $11 billion. That makes us $21 billion better off than we had estimated.

Now, the Senator from Maine now wants to talk about the fact that the bookkeeping might not be exact, the way he would like to see it, come 1978. Well, Mr. President, the President just got through last night recommending a whole host of new taxes, running into at least $25 billion of taxes, that he would like for us to vote by 1978. 1 think he was optimistic if he thinks we are going to vote the whole $25 billion; but he will not be completely disappointed. We are going to vote some of those taxes which the President recommended last night.

Everyone knows the budget resolution for 1978 is not binding until we vote the second resolution. I have managed tax bills before. I have managed big tax bills before. I have seen Senators put amendment after amendment on the bill, to where someone would wonder whether we were absolutely going to run out of all the money the printing press could print before we finished amending the bill. But by the time the bill went to conference and the differences were worked out between the Senate and the House, the bills have come out with a balance everyone thought we could live with, including the administration.

So I am not concerned to the degree the Senator from Maine is worried that every time we vote for an amendment someone does not agree with, that is going to destroy the country. We may very well have offered on this bill, for example, an amendment to implement the countercyclical program with another $2 billion. We may agree to it, or we may not. But at this point no one can say we are going to spend all the money the President would like to spend, just as no one can say we are going to put on all the taxes the President would like to put on.

But I remember last year, when the chairman of the Budget Committee led a fight to break the budget, we found that it is possible to work out the overall package to bring it within whatever targets we may want to insist on here.

I, of course, welcome the right of the Senator to advise us amendment by amendment with regard to what he thinks this would do with regard to 1978, or any year. But I point out that the Senator has been known to support a lot of things that could break the budget, because he favored the amendments.

I think Senators should, when they think an amendment is a good amendment, vote for it, or if they think it is a bad amendment not vote for it, and let their conscience be their guide.

Mr. CURTIS. Mr. President, will the Senator yield?

Mr. LONG. I yield.

Mr. CURTIS. I have great respect for the Budget Committee. I think it is made up of eminent gentlemen, dedicated to their task. But after all, they have a very big job. There is a deficit of $50 billion, $60 billion, or $70 billion. We will never bring it into balance by fine tuning or asserting jursidiction over the tax law. What the country is waiting for is for the Budget Committee to bring in some recommendations to lessen the size of our Government.

How are we going to get rid of a $60 billion deficit? Only by having less Government.

I do not care about what kind of language was in there or what kinds of speeches were made, when the Budget Committee was created.

The fact remains the American people expect that committee to go to the task, look at our expenditures, and bring in a plan to cut them down, even if it reduces the size of Government, even if it takes certain benefits away, even if it discontinues certain programs.

Why do we have a Budget Committee? There was a time when the taxing committees were the appropriating committees. The job got too big so they divided it. Both groups carried on their work without any coordination or without the coordination they should have. Here we have vested in one committee the responsibility of bringing our budget under control.

Every time we have a tax bill there is a catastrophe about every amendment which the Finance Committee seems to have worked on for months.

Even if the will objecting to the Finance Committee prevailed it would not be a drop in the bucket on bringing this budget into balance. This budget can only be brought into balance by less expenditures, less programs, cutting down on some, postponing some, doing away with others entirely. It is either that or go on with the unbalanced budgets.

I know of no one who is realistic, who believes all of these projections that the experts put out that they will have a balanced budget in 1981, 1982, or 1983. That has been said for the last 50 years and we go on adding to our Government.

Last week or the week before last, an unemployment compensation bill was before the Senate.

We increased the obligation on the general budget by $1 billion for the next 2 years by transferring an obligation that had been carried by the unemployment tax over to the general budget.

We did not get any help from that mighty force that heads the Budget Committee. I must say, Senator BELLMON joined in it.

We have been on the floor before with bills to reduce.

Mr. President, we cannot go on housing people, feeding people, giving them everything, taking care of all their wants, paying medical bills for everybody over 65 just because they are 65, and then go on adding to the welfare state and pay for it under a private enterprise system. We cannot collect that much taxes.

I hope the Budget Committee will come to the rescue of our country and that they will attack the job that the country expects from them, to cut down on expenditures from the Treasury. After all, this tax amendment we are debating is for the benefit of taxpayers. It is their money. They earned it. I thank my chairman for yielding.

Several Senators addressed the Chair.

The PRESIDING OFFICER. The Senator from Colorado.

Mr. MORGAN. Mr. President, will the Senator yield for a unanimous consent request?

Mr. HASKELL. Mr. President, I yield to the Senator from North Carolina without losing my right to the floor.

Mr. MORGAN. Mr. President, I ask unanimous consent that Mr. Harold Edwards and Mr. Robert Jackson, of my staff, be granted the privilege of the floor during the debate and votes on the pending measure.