October 13, 1978
Page 36782
Mr. DOLE. "Read it, look at the inflation provision. If you are concerned about agriculture, look at the parity provisions."
It seems to me that we put together a pretty good package. The first round was won by those who did not want the percentage of the GNP, and they were successful. I cannot say — in fact, I can say I am glad they were successful because they kept it alive.
Then we fought over one word "may" or "shall."
It is not a very big battle but we did it anyway.
I just suggest this is the critical one. I do not know of anyone, whether it is Mr. HAWKINS or whether it is Leon Keyserling or anybody, who really opposes the language in the compromise or so-called compromise.
I just hope that after this amendment has been considered and voted upon — and I hope it is defeated — I say that in a very positive sense because I would like to make one more statement tonight just before passage indicating strong support, and urging my colleagues on this side of the aisle to vote for it. I think not that that would persuade anybody, but at least I would have my vote.
Mr. MUSKIE. Mr. President, would the Senator yield?
Mr. DOLE. Yes.
Mr. MUSKIE. I listened with great care to what the Senator had to say. I simply want to compliment him for his attitude and for the commitment he makes to his views on this bill. We may disagree about particular provisions in this case, but I am impressed by what he has had to say, and I compliment him.
Mr. DOLE. I thank the Senator.
Several Senators addressed the Chair.
Mr. SARBANES. Mr. President, I yield myself 2 minutes.
The PRESIDING OFFICER. The Senator from Maryland is recognized.
Mr. SARBANES. I appreciate the comments which the Senator from Kansas and the Senator from Indiana have made but I disagree with them very strongly concerning the substance of this amendment.
I strongly support the amendment of the distinguished Senator from Minnesota, Mrs.
HUMPHREY, who has done so much to move this legislation forward. I commend her for the outstanding work she has done which reflects the long-standing Humphrey commitment to full employment for all Americans. .
I think taking an inflation rate of 3 percent, which I am very anxious to get to and tying it to a set time period, a fixed year, as the language that is in the pending substitute would do, raises a couple of dangers. One is that the fixed date will become a pressure or constraint for moving toward wage-price control measures, even though there are provisions elsewhere in this bill specifically prohibiting that. However, the fixed date creates a pressure for such control policies and I am frank to say I think that is a mistake. I do not favor those kinds of wage-price control policies except in the most extreme emergencies.
Second, I think the problem of inflation is going to be brought under control by a gradual deceleration over a period of time, and that we can probably plan how to do that and how to achieve it better if we are not within the specific time constraint we are placed in when we have a date specified in the legislation.
Now, some say we specify a date on the unemployment; but we really have had more experience with policies that deal with unemployment and moving theunemployment rate down than we have had with policies designed to move inflation downward; and, as the very distinguished Senator from Minnesota (Mrs. HUMPHREY) pointed out in her very thoughtful statement following the introduction of this amendment, we do not really have an anti-inflation program set in place for moving us down toward this level on a fixed schedule.
The Senator from Maine pointed out his work in the Budget Committee, which deals with this matter, and it seems to me that the language for accomplishing these inflation goals at the earliest practicable time provides us an incentive without placing us within an artificial constraint. We realize the issue that is being put is one that requires the careful attention of the Members of the Senate, but I would hope that upon reflection they will support the amendment by the Senator from Minnesota and the Senator from Maine.
Mr. President, I think we probably are prepared to go to a vote at this point.
Mr. NELSON. Mr. President, will my colleague yield?
Mr. PROXMIRE. Yes; I am happy to yield to my colleague from Wisconsin.
Mr. NELSON. How much time is available?
Mr. PROXMIRE. We have plenty of time.
Mr. NELSON. Five minutes?
Mr. PROXMIRE. Mr. President, I yield 5 minutes to my colleague from Wisconsin.
The PRESIDING OFFICER. The Senator from Wisconsin is recognized for 5 minutes.
Mr. NELSON. Mr. President, I rise to speak against the pending amendment.
I understand the strong feelings on both sides, and I am not in any way qualified — nor is anyone else, I guess, that I know of — to be an arbiter of what words mean, or words in association with each other, or phrases. The reason that people frequently end up having very strong feelings on different sides of an issue, which appears on its face to read very simply, is because they interpret what it means differently from persons on the other side. That goes on all the time. There is a great deal of subjectivity in the interpretation of what any phrase means.
Now, I understand the feelings of those — and I have discussed this with my very good friends, of whom I have many in the labor movement — who are strongly against the 3-percent inflation goal to be reached by 1983. The President would have the authority, when we arrive at 1983, if the inflation goal has not been achieved, not to change the goal, but to advise the country and Congress that the goal cannot be achieved in 1983, as had been hoped. The President could then propose to move the goal 2 years or 3 years forward.
I can understand how some people looking at the inflation goal, and based upon past history, feel that the only way low inflation will be achieved is by having a great big labor surplus. So it is felt that the only way low inflation will be accomplished is at the expense of labor. I guess this has been the historical pattern.
However, a very fine economist of national renown, and a great friend of labor, very carefully drafted the language so as to make clear that the goal of low unemployment takes precedence over any other goal in the bill. Everybody that has been associated with this on both sides of the aisle, the Republicans and the Democrats, including the Senator from Indiana (Mr. LUGAR) who spoke on it the other day in our conference, have all agreed that the unemployment goal takes precedence over any other goal, and that we tell the President, "You do not — you do not — adopt any policy that puts the inflation goal ahead of the unemployment goal."
Now, who can complain about that? As I said to my friends who are advocates of the bill, and have been my greatest supporters, and I would not be here without them, "How would you like to go to your membership, and say to them, `Would you like to have zero inflation and zero unemployment?' "
Everyone would vote for it. They would all vote for it. My constituents would all vote for it. I would vote for it; we all would vote for it.
Well, what is the quarrel about? Well, it Is a question of semantics. I am not saying they would not interpret it differently from me; they certainly would. And there are Members on the other side who interpret it differently from those on this side. That is all very understandable.
But I have looked at it very hard, backward and forward, and my constituency is on the other side of this issue. Those who have always supported me are on the other side. I just think that my interpretation of it is the correct one, and they think their interpretation is the correct one.
Given what I feel about the inflation goal, I honestly think the bill is better with it. You cannot go to your constituents, put a referendum on the ballot, and say "Let us have zero inflation and zero percent unemployment" — if you did that, you could not get 1 percent of the people to vote against it. So why not say it?
Some people say you should not say it because you cannot achieve it.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. PROXMIRE. I yield the Senator 2 more minutes.
Mr. MUSKIE. Mr. President, will the Senator yield one moment to me?
Mr. NELSON. Whose side is the Senator from Maine on?
Mr. MUSKIE. The Senator knows which side I am on.
Mr. NELSON. Well, then, I will not yield.
I yield to the Senator for a question.
Mr. MUSKIE. The Senator from Maine's reservations about this bill include the Senator from Wisconsin. I mean I was persuaded by the Senator from Wisconsin that it could be tailored to a realistic approach to the problems we are trying to address. I must say I am not particularly persuaded by the Senator's argument now, because he earlier had persuaded me otherwise.
Mr. NELSON. Well, this is a different day, I must say to the Senator from Maine. I do not recall what the Senator is referring to.
But what I say about this is that the goals are what we all want to achieve; why not have them in there?
Senator PROXMIRE has produced a chart which I am sure he discussed; I had to be off the floor for some other matters and did not hear the earlier part of the debate. For years, a good many years, 8 or 9 or 10, during the 20 year period from 1949 to 1970, we had 2 percent and less than 2 percent inflation, with lower unemployment than we have now, and better growth than we have now.
If we could do it then — 10 years ago 2.8 percent inflation, 4.9 percent unemployment: in 1965. 1.7 percent inflation, 3.6 percent unemployment, and almost 6 percent growth, 5.9 percent — why can we not do it now?
The PRESIDING OFFICER. The Senator's time has expired.
Mr. NELSON. May I have 2 more minutes?
Mr. PROXMIRE. I yield.
The PRESIDING OFFICER (Mr. McGOVERN). The Senator is making a great speech.
Mr. NELSON. That is what we ought to aspire to, given the careful language of the bill, and I repeat, otherwise I would not support it. The language of the bill makes it clear that the unemployment goal takes precedence over any other goal in here. So if at any time it appears that it is necessary to do something about unemployment and sacrifice some of the inflation goals, that is what happens, not vice versa.
So I am going to hope that this amendment will not prevail. I think that it is a good one, and I think again, as I said earlier this morning on the gross national product limitation, I thought it jeopardized the bill's support. We agreed on these three amendments, however, that we would live with whoever won or lost; we would lay it out, and we would vote. But one constituency out there in Wisconsin was unlikely, in my judgment, to support the bill at all if the GNP number limitation was in the bill, and I am happy it did not get in there.
I think this one should get in there. I think it helps the bill, and I hope the amendment will not be adopted.
I thank my colleague from Wisconsin.
Mr. PROXMIRE. Mr. President, I will be very brief. I know Senators are prepared to vote, but I would like to close by pointing out that if Senators would simply read the amendment in the bill, and realize what the Humphrey amendment would knock out, they would vote "no" on this amendment.
The statements in this letter on the bill are so reasonable, they are so consistent with the objectives of organized labor. I am going to read it.
I am going to read it. The trouble is that so many of these things people vote on by guess, because somebody else does, or because there is pressure from some group. They do not read what is before us. What does it say?
(21—Reducing the rate of inflation, as set forth pursuant to section 3(e) of this Act, to not more than 3 per centum within a period not extending beyond the fifth calendar year after the first such Economic Report: Provided, That policies and programs for reducing the rate of inflation shall be designated so as not to impede achievement of the goals and timetables specified in clause (1) of this subsection for the reduction of unemployment.
What is wrong with that? That is what you knock out if you vote "aye" on the pending amendment. What is in the bill is not only fair to those who believe inflation is a big issue, the fundamental issue, the primary issue before us, but it is also fair to those who believe that unemployment should be. the primary purpose of the bill. It preserves that. I have not talked to anyone, a Senator or a representative of labor, who has listened to that who will not agree that is the case.
They always change the subject after we point that out. What do they want? We are saying that unemployment shall be, No. 1 that the policies to achieve our inflation goals shall be such as not to impede progress toward reducing unemployment.
Now, Mr. President, I think we also ought to recognize what has gone on. Before the first vote we had, when we were talking about limiting spending, it was saying that, "If you pass that amendment and put that in the bill and put a lid on spending, you kill the bill, because the supporters of the bill in the House will not vote for it. They will take it down. They will be opposed to it. There is no way you will get the bill passed."
What have we done? We killed that. That was my amendment but we killed it. What was before the ad hoc committee, and I was a member of that committee and I sat through virtually every session, was that we ought to get a balance in this bill, and for a while we all agreed that we ought to have provisions making both subordinate to unemployment as our principal goal. The Senate has spoken and the Senate has knocked out the limitation on spending.
I submit if you also knock out the inflation goal, then you will have a possibility, and a very strong possibility, that you will not get any Humphrey-Hawkins bill at all. That was told us on the other one and that could happen this time because there are Senators here, and I respect their right and they have every right to do so, who have not one amendment or two amendments but hundreds of amendments, and even though this is a unanimous-consent agreement they can talk, a lot longer than on cloture. There is no limit to the number of germane amendments that I could design and others could design to delay.
Maybe they will not do that. If they do that, what do you have? You have a situation of killing, bypassing, this amendment that knocks out for any effective meaning the inflation goal. You have a bill that will make the business community, the small business community and the big business community, really angry, and they would have reason to be angry. They would feel that this bill is a one-sided bill that places no limitation on spending in the first place and that says, "We will not even put an inflation goal in the bill."
So, Mr. President, I do hope that Senators will consider what we are offering here. I do think we are being very fair. As has been pointed out over and over again by Senator DOLE and others, the labor people when they looked at this, when they came to our meetings, they said they could live with this. The principal author in the House, Gus HAWKINS, said they could live with this. They recognize the trade-off is eliminated here.
Under these circumstances I do hope the Senators will vote no on the pending amendment and give us an opportunity to have the balanced bill.
Mr. MUSKIE. Will the Senator yield?
Mrs. HUMPHREY. I yield.
Mr. MUSKIE. Mr. President, I have heard this amendment read twice, and I know what it says, and I am still opposed to it. There are two justifications that the Senator offers: One, that it really is not as rigid as I would make it out to be.
Well, if it is not, my answer is the same as my answer to his first amendment, that we do not need it. If it really does not tie us down in 1983 to 3 percent and in 1988 to 0 percent, if that is all just a lot of rhetoric that we can dream about, why put it in here? I think it is in here because it is intended to tie our hands.
The other reason why it is in here is that there is the possibility that we will be faced with a lot of amendments to the bill unless we defeat this amendment. I do not know anything about that. I was not part of this ad hoc group. I had no expectation to be drawn into this debate this afternoon. I had no amendments prepared. As a matter of fact, I thought it was a bad bill when it was introduced years ago. My effort this afternoon has been to try to improve it so that we would have a viable, flexible, economic policy that would serve the objectives of unemployment, reduction in inflation, and reduction in the Government share of GNP. Those are my goals and have been for 4 years as chairman of the Budget Committee. .
So much of this debate implies that we have done nothing about those things. Well, I challenge that. I challenge that vehemently. I said this afternoon that the budget process is on the same track that the advocates of this bill and the opponents of these amendments say they are on.
I do not take a back seat to their commitment whatsoever. All I am saying to the Senate is that I have been exposed to the making of economic policy long enough to know that you cannot write it into law several years in advance with targets that you are mandated to meet. If you are not mandated to meet them, what have you done? What have you done? Except to raise expectations beyond what is realistic.
I am for legislative compromise. I have been engaged in it for 25 years.
Mr. PROXMIRE. Will the Senator yield?
Mr. MUSKIE. I did not ask the Senator from Wisconsin to yield and I am going to finish my thought. It will not take 30 seconds to finish what is on my mind.
I have listened to this all afternoon, and I have heard it said of me all the time that if I offer this amendment I am not against inflation. Well, who cut the deficit by $22 billion since January? Who cut outlays by $12.7 billion since January? Who cut budget authority $12.5 billion since January? The distinguished chairman of the Appropriations Committee and the Budget Committee.
I reject the assertion that by offering this amendment I am not for controlling inflation.
To suggest that the only way to control inflation is to vote for this piece of rhetoric which on the one hand the sponsors and supporters say means something and on the other hand they say it does not mean anything if you cannot meet it.
To what extent are we prepared to fool ourselves? If we do not believe what we are writing here, what are we bothering with it for?
Mr. President, I strongly support the amendment of my good friend and old associate, Senator HUMPHREY, and I hope the Senate will join me in doing so.
Mr. PROXMIRE. Is the Senator from Minnesota ready to yield back her time?