May 23, 1979
Page 12398
FIRST CONCURRENT RESOLUTION ON THE BUDGET, FISCAL YEAR 1980 — CONFERENCE REPORT
Mr. MUSKIE. Mr. President, I submit a report of the committee of conference on House Concurrent Resolution 107 and ask for its immediate consideration.
The PRESIDING OFFICER (Mr. PRYOR). The report will be stated.
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 resolution (H. Con. Res. 107) setting forth the congressional budget for the US. Government for fiscal year 1980 and revising the congressional budget for the U.S. Government for fiscal year 1979, having met, after full and free conference, have been unable to agree. Signed by a majority of the conferees.
The PRESIDING OFFICER. Without objection, the Senate will proceed to the consideration of the conference report.
(The conference report is printed in the House proceedings of the RECORD of May 21, 1979.)
Mr. MUSKIE. Mr. President, I ask unanimous consent that the use of small electronic calculators be permitted on the Senate floor during consideration of and votes on the conference report on House Concurrent Resolution 107.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, I ask unanimous consent that the following members of the staff of the Budget Committee be allowed to remain on the floor during consideration of and vote on the conference report on House Concurrent Resolution 107:
John McEvoy, Karen Williams, Susan Lepper, George Merrill, Brenda Tremper, Rodger Schlickeisen, John Tillson, Lizabeth Tankersley, and Sid Brown.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, I move that the conference report in disagreement be agreed to.
The PRESIDING OFFICER. Without objection, the conference report in disagreement is agreed to.
Mr. MUSKIE. Mr. President, I think I have to make one further request before I go any further.
I ask unanimous consent that the Senate recede from its amendment to the resolution (H. Con. Res. 107), and that it only be in order to move to agree to the resolution with a new amendment in the nature of a substitute, which shall not be amended.
The PRESIDING OFFICER. Is there objection?
Mr. STEVENS. Mr. President, reserving the right to object, and I do not object, is my understanding correct that the distinguished chairman of the Budget Committee and the ranking minority member have worked out a substitute which deals with the education portion and will not deal with the military portion of the budget resolution?
Mr. MUSKIE. The Senator is correct.
Mr. STEVENS. I do not object.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MUSKIE. Mr. President, I will not take any more time than is necessary—
Mr. ROBERT C. BYRD. Mr. President, was the request cleared?
The PRESIDING OFFICER. The request has been agreed to.
Mr. MUSKIE (continuing). Than is necessary to respond to any questions and briefly present the conference report pending at the desk.
Mr. ROBERT C. BYRD. Mr. President, does the Senator expect a roll call vote?
Mr. MUSKIE. I think, in view of the action taken by the House of Representatives today, a roll call vote would be quite important.
Mr. ROBERT C. BYRD. Perhaps, if the Senator feels a roll call is important, we should order the yeas and nays.
The PRESIDING OFFICER. First, the amendment will be stated.
Mr. ROBERT C. BYRD. I did not mean to interrupt except to ask for a roll call vote.
The PRESIDING OFFICER. The clerk will state the amendment.
UP AMENDMENT NO. 191
The second assistant legislative clerk read as follows:
The Senator from Maine (Mr. MUSKIE.) proposes an unprinted amendment numbered 191.
The amendment is as follows:
Strike all after the resolving clause and insert the following:
That Congress hereby determines and declares, that pursuant to section 304 of the Congressional Budget Act of 1974:
REVISIONS TO THE SECOND CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 1979
(a) Section 1 of H. Con. Res. 683 is revised as follows:
(1) The recommended level of Federal revenues is $461,000,000,000 and the amount by which the aggregate level of Federal revenues should be decreased is $100,000,000.
(2) The appropriate level of total new budget authority is $559,200,000,000.
(3) The appropriate level of total budget outlays is $494,450,000,000.
(4) The amount of the deficit in the budget which is appropriate in the light of economic conditions and all other relevant factors is $33,450,000,000.
(5) The appropriate level of the public debt is $834,200,000,000, and the amount by which the temporary statutory limit on such debt should accordingly be increased is $4,200,000,000.
(b) Section 2 of H. Con. Res. 683 is revised as follows:
(1) National Defense (050) :
(A) New budget authority, $127,000,000,000;
(B) Outlays, $114,400,000,000.
(2) International Affairs (150) :
(A) New budget authority, $11,400,000,000;
(B) Outlays, $7,500,000,000.
(3) General Science, Space, and Technology (250):
(A) New budget authority, $5,400,000,000;
(B) Outlays, $5,200,000,000.
(4) Energy (270) :
(A) New budget authority, $7,600,000,000;
(B) Outlays, $7,400,000,000.
(5) Natural Resources and Environment (300) :
(A) New budget authority, $12,900,000,000;
(B) Outlays, $11,300,000,000.
(6) Agriculture (350) :
(A) New budget authority, $8,300,000,000;
(B) Outlays, $6,200,000,000.
(7) Commerce and Housing Credit (370):
(A) New budget authority, $5,900,000,000;
(B) Outlays, $2,900,000,000.
(8) Transportation (400):
(A) New budget authority, $19,100,000,000;
(B) Outlays, $17,000,000,000.
(9) Community and Regional Development (450):
(A) New budget authority, $9,200,000,000;
(B) Outlays, $9,700,000,000.
(10) Education, Training, Employment. and Social Services (500):
(A) New budget authority, $32,700,000,000;
(B) Outlays, $29,700,000,000.
(11) Health (550):
(A) New budget authority, $53,000,000,000;
(B) Outlays, $49,700,000,000.
(12) Income Security (600) :
(A) New budget authority, $194,150,000,000;
(B) Outlays, $161,100,000,000.
(13) Veterans Benefits and Services (700):
(A) New budget authority, $20,400,000,000;
(B) Outlays, $20,200,000,000.
(14) Administration of Justice (750):
(A) New budget authority, $4,200,000,000;
(B) Outlays, $4,200,000,000.
(15) General Government (800):
(A) New budget authority, $4,300,000,000;
(B) Outlays, $4,200,000,000.
(16) General Purpose Fiscal Assistance (850):
(A) New budget authority, $8,650,000,000;
(B) Outlays, $8,750,000,000.
(17) Interest (900):
(A) New budget authority, $52,400,000,000;
(B) Outlays, $52,400.000,000.
(18) Allowances (920) :
(A) New budget authority, $700,000,000;
(B) Outlays, $700,000,000.
(19) Undistributed Offsetting Receipts (950) :
(A) New Budget authority, —$18,100,000,000;
(B) Outlays, —$18,100,000,000.
Sec. 2(a) Pursuant to section 301(a) of the Congressional Budget Act of 1974, that for the fiscal year beginning on October 1, 1979—
(1) the recommended level of Federal revenues is $509,000,000,000, and the amount by which the aggregate level of Federal revenues should be increased or decreased is zero;
(2) the appropriate level of total new budget authority is $604,400,000,000;
(3) the appropriate level of total budget outlays is $532,000,000,000;
(4) the amount of the deficit in the budget which is appropriate in the light of economic conditions and all other relevant factors is $23,000,000,000; and
(5) the appropriate level of the public debt is $887,200,000,000, and the amount by which the temporary statutory limit on such debt should be accordingly increased is $57,200,000,000.
(b) Based on allocations of the appropriate level of total new budget authority and of total budget outlays as set forth in paragraphs (2) and (3) of the preceding subsection of this resolution, the Congress hereby determines and declares pursuant to section 301(a) of the Congressional Budget Act of 1974 that, for the fiscal year beginning on October 1, 1979, the appropriate level of new budget authority and the estimated budget outlays for each major functional category are as follows:
(1) National Defense (050):
(A) New budget authority, $136,600,000,000;
(B) Outlays, $124,200,000,000.
(2) International Affairs (150):
(A) New budget authority, $12,600,000,000;
(B) Outlays, $7,900,000,000.
(3) General Science, Space, and Technology (250) :
(A) New budget authority, $5,700,000,000;
(B) Outlays, $5,500,000,000.
(4) Energy (270):
(A) New budget authority, $18,800,000,000;
(B) Outlays, $6,800,000,000.
(5) Natural Resources and Environment (300):
(A) New budget authority, $12,600,000,000;
(B) Outlays, $11,700,000,000.
(6) Agriculture (350):
(A) New budget authority, $5,000,000,000;
(B) Outlays, $5,400,000,000.
(7) Commerce and Housing Credit (370):
(A) New budget authority, $6,900,000,000;
(B) Outlays, $3,200,000,000.
(8) Transportation (400) :
(A) New budget authority, $19,450,000,000;
(B) Outlays, $18,200,000,000.
(9) Community and Regional Development (450):
(A) New budget authority, $8,900,000,000;
(B) Outlays, $8,100,000,000.
(10) Education, Training, Employment, and Social Services (500):
(A) New budget authority, $30,850,000,000;
(B) Outlays, $30,500,000,000.
(11) Health (550):
(A) New budget authority, $58,100,000,000;
(B) Outlays, $53,600,000,000.
(12) Income Security (600):
(A) New budget authority, $214,800,000,000;
(B) Outlays, $183,300,000,000.
(13) Veterans Benefits and Services (700):
(A) New budget authority, $21,200,000,000;
(B) outlays, $20,600,000,000.
(14) Administration of Justice (750):
(A) New budget authority, $4,200,000,000;
(B) Outlays, $4,400,000,000.
(15) General Government (800):
(A) Now budget authority, $4,400,000,000;
(B) Outlays, $4,300,000,000.
(16) General Purpose Fiscal Assistance (850):
(A) New budget authority, $8,100,000,000;
(B) Outlays, $8,100,000,000.
(17) Interest (900):
(A) New budget authority, $56,000,000,000;
(B) Outlays, $58,000,000,000.
(18) Allowances (920):
(A) New budget authority, —$100,000,000;
(B) Outlays,—$100,000,000.
(19) Undistributed Offsetting Receipts (950):-
(A) New budget authority, —$19,700,000,-000;
(B) Outlays, —$19,700,000,000.
BUDGET AGGREGATES FOR FISCAL YEARS 1981 AND 1982
SEC. 3(a) In order to achieve a balanced budget in fiscal years 1981 and 1982, the following aggregate budgetary levels recommended by the Senate are appropriate for fiscal years 1981 and 1982
(1) The recommended level of revenues is as follows:
Fiscal year 1981: $583,300,000,000;
Fiscal year 1982: $621,000,000,000;
and the amount by which ,the aggregate levels of Federal revenues should be increased or decreased is as follows:
Fiscal year 1981: +4,600,000,000;
Fiscal year 1982: —$49,900,000,000;
(2) the appropriate level of budget authority is as follows:
Fiscal year 1981: $640,300,000,000;
Fiscal year 1982: $691,600,000,000;
(3) The aggregate level of total budget outlays is as follows:
Fiscal year 1981: $577,700,000,000;
Fiscal year 1982: $616,900,000,000;
(4) the amount of surplus in the budget is as follows:
Fiscal year 1981: $5,600,000,000;
Fiscal year 1982: $4,100,000,000;
(5) the appropriate level of the public debt is as follows:
Fiscal year 1981: $912,600,000,000;
Fiscal year 1982: $947,500,000,000.
(b) The House projects the following budget aggregates for fiscal years 1981-82, based on the policies assumed in section two above
(1) The level of Federal revenues is as follows :
Fiscal year 1981: $579,800,000,000;
Fiscal year 1982: $655,300,000,000;
(2) the level of total new budget authority is as follows:
Fiscal year 1981: $658,700,000,000;
Fiscal year 1982: $721,400,000,000;
(3) the level of total budget outlays is as follows:
Fiscal year 1981: $577,700,000,000;
Fiscal year 1982: $622,700,000,000;
(4) the amount of surplus in the budget is as follows:
Fiscal year 1981: $2,10,000,000;
Fiscal year 1982: $32,600,000,000;
(5) the level of the public debt is as follows:
Fiscal year 1981: $918,100,000,000.
Fiscal year 1982: $922,500,000,000.
GENERAL PROVISIONS
SEC. 4(a) The Congress recognizes that the activities of off-budget Federal entities are excluded from the budget by law. The Congress recommends that a way be found within the Congressional budget process to relate accurately the estimates of off-budget Federal entities and capital expenditures to the unified budget.
(b) In 1979 each standing committee of the House of Representatives shall report by July 1 to the House of Representatives its recommendations and the status of its actions with respect to new spending authority including all legislative savings, and other reforms, targeted by the first concurrent resolution on the budget for the fiscal year ending on September 30 of that same year. This report shall include any additional legislative savings which the committee believes should be considered by the House in the programs for which such committee has responsibility.
In 1980, each standing committee of the House of Representatives shall include in its March 15 report to the Budget Committee of the House of Representatives specific recommendations as to all possible legislative savings for the programs for which the committee has responsibility.
In 1980, each standing committee of the House of Representatives shall include in its March 15 report to the Budget Committee of the House of Representatives an estimate of the unobligated (and unexpended) balances of budget authority, an analysis of the extent to which such unexpended or unobligated balances could reasonably be reduced, and what steps, if any, have been or are being taken to reduce such balances.
Mr. ROBERT C. BYRD. Mr. President, I ask for the yeas and nays on the amendment.
The PRESIDING OFFICER. Is there a sufficient second? There is a sufficient second.
The yeas and nays were ordered.
Mr. GOLDWATER. Mr. President, will the Senator indicate about when that vote might occur? We have a committee meeting.
Mr. MUSKIE. I can complete my presentation within 30 minutes, I think. How much more time it may take depends on what questions Senators may have. But I would think that half to three quarters of an hour should be ample for the consideration of the amendment.
Mr. ROBERT C. BYRD. Would the Senator like to set a time, say 6:15 or not later than 6:30?
Mr. MUSKIE. That would be acceptable.
The PRESIDING OFFICER. Under the act, there is one-half hour on amendments.
Mr. ROBERT C. BYRD. Oh, that is correct; 30 minutes.
The PRESIDING OFFICER. Thirty minutes.
Mr. MUSKIE. Mr. President, the question before the Senate is on agreeing to the congressional budget resolution for fiscal years 1979, 1980, 1981, and 1982. I had hoped Congress could complete final action on this resolution this evening. I had hoped we would have before us the conference agreement worked out with the House last week. Instead, we must take one step more to complete action on this resolution. As the Senate is aware, the House this morning rejected the conference agreement on the ground that it did not contain sufficient funds for educational programs.
After consultation with the Senate conferees, the leadership in the Senate, and the House conferees, we have proposed an amendment, now pending, which contains all the budget totals agreed to by the conference except for $350 million in additional budget authority for education programs in function 500. No other changes are made. The defense numbers remain intact.
Mr. President, the Senate conferees recommend that the Senate adopt this amendment, because we believe that if we do, the House will do likewise tomorrow. The addition of $350 million to a budget that exceeds $600 billion is not a significant addition, when viewed in a historic context.
The Appropriations Committee has funded these programs at a level substantially lower than the amount provided in the budget resolution. For this reason, the Senate conferees believe that the funds can be added without jeopardizing the total budget plan.
After I have completed a brief description of the elements of the conference agreement, Mr. President, including the education. change we are considering tonight, I will be asking the Senate to return our conference agreement to the House with this one change for education, in the hope that the House will adopt the amended resolution tomorrow and complete action on this congressional budget.
Of course Mr. President we are disappointed that the House rejected the agreement we achieved after considerable labor last week. Yet the matter on which the House based its rejection is only a small part of a much larger and more important achievement for the budget process.
Mr. President, the agreement we have achieved represents a remarkable accomplishment. Just a few weeks ago we set ourselves an imposing fiscal challenge. In the debt ceiling bill we committed the Senate to the swift achievement of a balanced Federal budget. More importantly we instructed the Budget Committee to blueprint a plan for making it happen.
There were many who dismissed the very idea. It was said that we lacked the will. It was said that our parochial interests in spending programs would overpower our national interest in fiscal restraint. It was said that the rhetoric of budget balancing would comfortably coexist with the reality of a permanent deficit.
Today it must be said that the cynics were wrong.
We come to the floor of the Senate with an agreement to balance the budget in fiscal 1981 — an agreement reflecting the positions of both Houses of Congress — an agreement which many insisted could never pass muster in either.
These budget targets set a deficit of $23 billion for fiscal year 1980. Only weeks ago, it was widely assumed that a deficit of $30 billion was an unrealistic goal.
These budget targets set outlay levels for fiscal 1979 and for fiscal 1980 which are actually lower than those agreed to by the Senate. Just days ago, few of us would have expected that.
When we went to conference, the Senate budget resolution contained aggregate and functional budget totals for 1979, 1980, 1981, and 1982. The 1981 budget was in balance.
The House resolution provided budget totals only for 1980.
The conference agreement contains aggregate budget totals for all 4 years. The aggregate 1981 totals reflect a balanced budget, and the Statement of Managers reflects the commitment of the House and Senate managers to balance the budget in 1981.
Some important differences remain between the Houses on these outyear budget totals. These differences derive mainly from the fact that the House did not consider any outyear totals in the construction and consideration of its resolution. So it was impossible in the conference for the House to begin that process, which the Senate had already completed.
So while both Houses agree, in the conference agreement, on outlay and revenue totals for 1981 and 1982 which will produce a balanced budget in those years, the specific budget totals in those years and the question of a 1982 tax cut remain in dispute. The Senate continues to stand for lower spending totals and larger tax cuts. The House takes the opposite position. These matters will have to be settled in future budget resolutions.
The budget resolution does not contain functional totals for 1981 and 1982, even though the Senate resolution did, because the House was unable to construct its version of those numbers in the conference. Instead, the Senate's functional numbers, as affected by the conference, are contained in the Statement of Managers. They will be used to scorekeep the future year implications of legislation considered in the Senate to help achieve the 1981 and 1982 balanced budgets and the major tax cut proposal for 1982.
More significant than these differences, however, is acceptance by the House in this conference of two propositions:
First, the budget resolution does include budget limits for 1981 and 1982.
Second, that budget resolution calls for a balanced budget in 1981 and 1982.
The budget targets allow for a major tax cut in fiscal 1982, despite the pronouncements of those who insisted that a near term balance in conjunction with a tax cut was a practical impossibility.
Mr. President, I recommend the Senate's endorsement of this agreement without hesitation. It is fully consistent with the Senate's commitment to austerity. It closely parallels the Senate's endorsement of specific restraints and sacrifices.
The House conferees were firm and skillful advocates. But fundamentally, a commitment to fiscal integrity is shared by both Houses. That common perspective helped preserve the Senate's positions.
In many functional areas, the Senate's numbers are intact. The conference report sustains our savings in medicare and in medicaid. It endorses our savings in social security retirement and in disability programs. It follows our plan for once-yearly rather than twice-yearly cost-of-living adjustments for Federal annuitants. It maintains the Senate levels for the Strategic Petroleum Reserve, which reflect recent program changes, and it supports our cuts in transportation programs and in LEAA.
Significantly, this conference report sustains the Senate's firm commitment to substantial real growth in programs contributing to our national defense.
It should also be noted that the conference agreement would reduce the deficit, budget authority, and outlays as compared to President Carter's fiscal 1980 budget recommendations. The deficit it contains is $23 billion, $11.7 billion lower than President Carter's proposal on a comparable basis.
It also reduces the outlay and deficit amounts significantly below both current policy and current law levels.
Mr. President, I ask unanimous consent to have printed in the RECORD at this point a series of tables which compare the conference agreement aggregates with current law, with current policy, and with the President's budget proposals.
There being no objection, the tables were ordered to be printed in the RECORD, as follows:
[Tables omitted]
Mr. MUSKIE. The fiscal policy provided for in the conference substitute is one of restraint, as it was in the Senate resolution. The seriousness of inflation continues to demand the strictest budgetary discipline if fiscal policy is to play an appropriate role.
The conferees recognized that this implied a substantial slowing of real growth in the near term.
The productive capacity of the economy is not unlimited. If the Federal Government adds to total demand in the current and coming fiscal years, it will add to inflationary pressures rather than help restrain them. The current pace of inflation is worse than had been forecast just 5 months ago. The costs of continuing that trend are enormous. They are measured in terms of social discord and they make their mark on the strained fabric of our society. They are to be seen in terms of the plight of those on fixed incomes and they threaten the stability of the dollar in foreign exchange markets. The conference substitute is a firm statement by the Congress that fiscal policy will play its role in helping to lower and eliminate these costs.
I have said before and I repeat that fiscal policy cannot stand alone as a cure to inflation; nor will any cure come quickly or easily. The cooperation of all sectors of our society is required to bring inflation under control. Wage settlements, private sector price decisions, the prices allowed by regulatory agencies for public utilities, tax decisions of State and local governments and decisions by the Congress on cost-raising or cost-saving legislation all will have important effects on the inflation rate this year and in years to come.
The battle against inflation will be a long one. That is why conferees from both houses were able to agree on targeting a balanced budget in fiscal 1981 even though that means deferring a tax cut until 1982. The Senate conferees remain committed to providing a substantial tax cut in 1982.
This will compensate for the cumulative effects of social security tax increases and for the effects of inflation on effective individual income tax rates until that time.
Prudence does not permit earlier tax reductions if we are to move rapidly toward the objectives of appropriate fiscal restraint and a balanced budget which meets national priorities. But tax reduction is an important objective. It is a necessity if we are to maintain stable growth in the future.
Mr. President, the conferees agreed on assumptions regarding near term economic developments. I ask unanimous consent to have printed in the RECORD at this point a table containing those assumptions.
There being no objection, the table was ordered to be printed in the RECORD, as follows:
[Table omitted]
Mr. MUSKIE. Mr. President, this table shows that real growth in 1979 is expected to slow to 3.3 percent this year from 4 percent last year and to slow further to 2.1 percent in 1980. This implies slightly greater strength in 1979 and slightly less in 1980 than the Senate Budget Committee assumed in its report. This adjustment was consistent with the latest economic data available to us.
Even if these modest growth rates are to be achieved it will be necessary for the monetary authorities to recognize that the Congress has joined them in the fight against inflation. They must make an appropriate accommodation to this fact.
Neither the Congress nor the Federal Reserve can control inflation stemming from OPEC price decisions or from the effects of adverse weather on food prices without precipitating a serious economic downturn and enormous unemployment costs. I believe that the Federal Reserve agrees that this danger can and should be avoided.
The agreed to economic assumptions project that consumer prices this year will be 8.4 percent above last year's and will rise another 7.8 percent in 1980. These are the rates of inflation that were assumed by the Senate Budget Committee in its preparation for the first concurrent resolution a few weeks ago.
At the present time, consumer prices are 10.2 percent above those of a year ago. This implies substantially more rapid inflation than was assumed for 1979 as a whole. This is primarily due to special forces affecting food and fuel prices.
Because of these developments, which have become apparent since either house passed its resolution, a reestimate was made of revenues for 1979 and 1980 to reflect the estimated additional half percentage point of inflation. The revenues in these years were revised upward by $3.8 and $5.4 billion, respectively, to reflect the best estimate of the impact of higher inflation on future tax collections. Spending totals were not adjusted upward because of the Senate's determination to hold spending within the limits Congress has already agreed to.
On balance, Mr. President, the fiscal policy contained in the conference agreement is one of stringency required by the current inflationary circumstances. The deficit of $23 billion recommended for fiscal 1980 is $10.45 billion below that estimated for fiscal 1979 and $6.0 billion below the deficit contained in the first resolution previously voted by the Senate.
The Senate resolution for fiscal years 1981 and 1982 adjusted for the actions taken in conference now calls for modest surpluses of $5.6 billion and $4.1 billion, respectively. Yet this fiscal policy is prudent in avoiding the draconian cuts that would be entailed by a headlong rush to a balanced budget in 1980. Such cuts would entail truly unconscionable social and economic costs.
Governmental responsibilities would go unfulfilled and unemployment would soar with virtually no benefits to show for it.
We can and must walk the narrow path between too little and too much restraint. We can never be sure how economic events will unfold. We know that unforeseen economic events can upset the best budget projections. But we can attempt to pursue a steady budgetary course, avoiding the excesses in either direction that will surely skid the economy into spiraling unemployment or inflation. The conference committee recommends just such a steady course.
REVENUES
1979
For fiscal year 1979, the conference agreement anticipates Federal revenues of $461.0 billion. It is assumed that sugar legislation and miscellaneous tax and tariff measures will be enacted to reduce Federal revenues by $0.1 billion.
The Senate resolution provided for fiscal year 1979 revenues of $457.2 billion, and assumed revenue reductions of $0.1 billion. The higher revenue target in the conference agreement reflects increased collection rates which are revealed in the most recent data.
1980-82
For fiscal year 1980, the conference agreement provides for Federal revenues of $509.0 billion. It assumes that on a net basis, any increases or decreases resulting from legislation will offset each other. Any revenue reductions produced by new legislation must be offset by increases resulting from legislative initiatives considered by Congress this year.
The revenue estimates for 1981 and 1982 carry forward the economic assumptions upon which the fiscal year 1980 first concurrent resolution revenue target was based. In addition, these latter year figures assume two major substantive law changes.
First, the fiscal year 1982 figure assumes a gross general tax reduction in fiscal year 1982 of $55 billion.
Second, a series of tax administrative initiatives proposed by the President is assumed, which could raise approximately $5 billion in each fiscal year, 1981and 1982. These initiatives can include a combination of the cash management proposals recommended by the President and/or other tax administration proposals such as the initiation of withholding on interest and dividends.
Mr. President, at this point I will present a brief summary of the most important aspects of the conferees' agreement regarding each of the budget's functional areas.
FUNCTION 050
1979
The fiscal year 1979 totals for the national defense function provide for $127 billion in budget authority and $114.4 billion in outlays. These amounts represent a reduction of only $0.2 billion in budget authority and $0.1 billion in outlays from the Senate passed levels.
1980-82
The conference agreement provides for budget authority of $136.6 billion, and for outlays of $124.2 billion in fiscal year 1980.
The Senate conferees maintained a firm commitment to real growth in defense spending, particularly in research and development and in procurement, both of which enhance the strength of the NATO alliance.
The proposed conference targets allow for substantial improvements in U.S. force capabilities. Each member nation of the NATO alliance has pledged to aim for 3-percent real growth in defense spending over the next several years. Improvements provided under the levels of the conference agreement will allow this Nation to meet that obligation. The conference agreement, in fact, provides for approximately 3.5-percent real growth in budget authority for defense investment activities. That growth, moreover, has been provided for despite the stringencies imposed by the decision to balance the budget in fiscal year 1981. Further, the conference agreement is consistent with the 3-percent real growth investment in fiscal year 1981.
FUNCTION 150
1979
The fiscal year 1979 total for function 150 provides for $11.4 billion in budget authority and $7.5 billion in outlays. This total is sufficient to provide for the Middle East Peace Treaty, the additional assistance for Turkey and the increase in refugee assistance.
1980-82
For fiscal year 1980, the conference agreement provides for $12.6 billion in budget authority; or $600 million above the Senate-passed level. Outlays remain at $7.9 billion.
The increase over the Senate-passed level results from the conference's agreement to allow for the President's full requests regarding Public Law 480 Food Aid and the Export-Import Bank.
Other increases were made in order to allow for slightly higher levels of international development assistance and to accommodate a substantial part of the President's recent requests for additional security assistance. Fiscal 1980 requests for Turkey, Sudan, and other countries were transmitted to Congress after the Senate began consideration of the first budget resolution.
The conference agreement for fiscal 1980 also includes a technical adjustment in the Foreign Military Sales Trust Fund.
For fiscal years 1981 and 1982, the conference agreement is consistent with the continuation of these programs at roughly current levels.
FUNCTION 250
1979
For the General Science, Space and Technology function, the conference agreement includes fiscal year 1979 budget authority of $5.4 billion and outlays of $5.2 billion. These are the Senate-passed ceilings. They would accommodate a supplemental for the National Aeronautics and Space Administration space shuttle program.
1980-82
The conferees agreed to fiscal year 1980 budget authority of $5.7 billion and outlays of $5.5 billion for this function. These figures are identical to the Senate-passed levels and to the President's fiscal year 1980 budget request.
Over the next 3 years these funding levels would accommodate real growth in basic science research and development, provide for a four-orbiter space shuttle system, and allow no new space flight missions.
FUNCTION 270
1979
For the energy function, the conference adopted fiscal year 1979 budget authority of $7.6 billion and outlays of $7.4 billion, the same as the Senate-passed levels. The conference totals would accommodate supplemental requests for Department of Energy Activities including solar research and implementation of new regulatory legislation, such as the Natural Gas Policy Act.
1980-82
For fiscal year 1980, the conferees agreed to energy budget authority of $18.8 billion and outlays of $6.8 billion. These totals include increases of $0.4 billion in both budget authority and outlays above the Senate-passed levels.
Increases are assumed for energy supply and conservation activities, reflecting the view of the conferees that our current national energy situation warrants more Federal spending on research and development of alternative energy supplies. Over the next 3 years, expansion of energy supply and conservation activities would be possible.
The conferees accepted the Senate position on funding for the strategic petroleum reserve program by assuming a rescission of $1 billion in budget authority and a reduction in outlays of $1 billion. The program has experienced repeated managerial problems and recent supply interruptions which have delayed progress in meeting storage goals. The rescission would reduce unobligated balances expected to be available to the program at the end of fiscal year 1980, while the outlay reduction would reflect delayed oil purchases. Increased funding is assumed in fiscal year 1981 and 1982 to bring the program closer to the most recent schedule for meeting storage goals.
FUNCTION 300
1979
For natural resources and environment, the conferees maintained the Senate-passed levels of $12.9 billion in budget authority and $11.3 billion in outlays for fiscal year 1979. However, because of recent heavy flooding along the Mississippi River and elsewhere, it appears that disaster assistance will be higher than assumed by the Senate. If this occurs, it will require tradeoffs among other competing programs in the function.
1980-82
The conference agreement for fiscal year 1980 for this function is $12.6 billion in budget authority and $11.7 billion in outlays. The level of budget authority is $0.1 billion higher than the figure set in the Senate-passed mark because the conferees agreed to accommodate funding for the rural clean water program. The outlays are the same as those in the Senate-passed level.
The conference agreement would allow for funding of water resource activities at about the current law level through fiscal year 1982. It would provide for real increases in reforestation and other forest management programs while consolidating agricultural conservation programs with funding below current law during the 3-year period. Funding for recreational resources would be reduced in fiscal years 1980 and 1982, requiring tradeoffs among the major programs, including the land and water conservation fund, park construction, and urban parks rehabilitation. The conference agreement would provide for decreases in EPA's construction grant program in fiscal year 1980 and in fiscal year 1981 but would increase funding above current law in fiscal year 1982. Funding for EPA's research and regulatory programs would be increased over the 3-year period.
FUNCTION 350
1979
For fiscal year 1979, the conference agreement maintains the Senate-passed levels of $8.3 billion in budget authority and $6.2 billion in outlays for the agriculture function. These totals could accommodate purchases for an emergency food reserve or possibly higher outlays for Commodity Credit Corporation activities.
1980-82
For fiscal year 1980, the conferees accepted the Senate-passed agriculture targets of $5.0 billion in budget authority and $5.4 billion in outlays. The conference substitute would provide for a continuation of agricultural research and services programs at current policy. It also would allow for new sugar price support legislation similar to that proposed by the administration, and for an increase in short term agricultural export credit above the amount requested by the President.
Neither the budget authority nor the outlay allowance would accommodate any further significant increases above current law in farm price support and loan programs or other new initiatives.
Most programs assumed in fiscal year 1980 under the conference substitute would be allowed to continue at current activity levels in fiscal years 1981 and 1982. Savings of $0.2 billion per year in Commodity Credit Corporation outlays are assumed. This reflects better management of commodity supply and demand and reductions in duplicative and counterproductive programs.
FUNCTION 370
1979
For commerce and housing credit, the house conferees accepted the Senate ceilings of $5.9 billion in budget authority and $2.9 billion in outlays. These ceilings should accommodate currently projected fiscal year 1979 operations of existing programs, as well as the start-up of the National Consumer Co-operative Bank.
1980-82
For fiscal year 1980, the conferees agreed upon targets of $6.9 billion in budget authority and $3.2 billion in outlays. The targets should accommodate the projected operations of existing Federal mortgage assistance programs. They assume continued appropriations to the Postal Service in keeping with existing law, and they anticipate that small business assistance will place greater emphasis on loan guarantees than in the past. New spending initiatives could not be accommodated unless savings were realized elsewhere in the function.
In fiscal year 1981 and fiscal year 1982, the recommendations assume continued funding for all current programs, but at slightly reduced levels that would force implementation of increased program efficiencies. As with the fiscal year 1980 targets, no funding allowance has been included for any major new initiatives.
FUNCTION 400
1979
In transportation, the conferees agreed on $19.1 billion in budget authority and $17.0 billion in outlays for fiscal year 1979. The reduction of $0.7 billion in budget authority below the Senate figure reflects an agreement to assume annual appropriation of ConRail funds rather than a fiscal year 1979 lump sum appropriation of the remaining available authorization. Otherwise, the Senate-passed ceilings are unchanged.
1980-82
The conferees agreed upon fiscal year 1980 transportation targets of $19.45 billion in budget authority and $18.2 billion in outlays. The increase in budget authority reflects two changes from the Senate-passed resolution: First, the conferees assumed that the remaining ConRail authorization will be provided in annual appropriations rather than in one lump sum in a fiscal year 1979 supplemental; Second, the conference recommendation restores $0.25 billion of the assumed $0.5 billion reduction in existing highway spending legislation.
For fiscal year 1981 and fiscal year 1982, the recommended targets assume: A small rescission of existing highway spending authority; continued assistance to ConRail in accordance with existing authorizations, and implementation of a reduced and more efficient Amtrak rail passenger network; small funding increases for airport development and noise abatement; and continued funding for mass transit and other transportation programs at roughly current law levels.
FUNCTION 450
1979
For fiscal year 1979, in community and regional development, the conferees agreed to new ceilings of $9.2 billion in budget authority and $9.7 billion in outlays, a reduction of $0.2 billion in budget authority and $0.1 billion in outlays below the Senate figures. The reduction assumes that pending supplemental appropriations for disaster assistance will be held below the President's request in order to encourage greater efficiency in Federal disaster programs.
1980-82
For fiscal year 1980, the conferees agreed upon targets of $8.9 billion in budget authority and $8.1 billion in outlays. Adoption of these targets will result in very tight funding constraints for function 450 programs. In both budget authority and outlays, the conference agreement is $0.1 billion below the Senate-passed first budget resolution. In addition, since passage of its version of the resolution, the Senate has also approved legislation which liberalizes SBA disaster loan provisions, at an estimated additional cost of $0.1 billion in budget authority and outlays.
Therefore, the aggregate funding allowances for the other programs in this function have been reduced by $0.2 billion, and appropriation for some or all of them will have to be restrained in order for the Congress to stay within its budget.
The targets for fiscal year 1981 and fiscal year 1982 provide for continued funding at roughly current law levels, with two major exceptions. First, reforms in the SBA disaster loan program are assumed to result in significant budget savings. Second, funding for EDA is assumed to increase significantly above current levels to finance new development program initiatives. Funding for any further new initiatives is assumed to be limited to whatever is provided through spending reductions for other development programs.
FUNCTION 500
1979
For education, training, employment, and social services, the conferees agreed to revised fiscal year 1979 levels of $32.7 billion in budget authority and $29.7 billion in outlays. These levels will allow for supplemental funding not assumed in the Senate-passed budget resolution for the title XX social services program.
1980-82
The conference agreed on totals of $30.5 billion in budget authority and outlays for fiscal year 1980. These levels represent an increase of $1.4 billion in budget authority and $0.6 billion in outlays over the Senate-passed targets. They are below the House marks by $1.8 billion in budget authority and $0.8 billion in outlays.
These levels allow more funding for most programs in this function than the Senate mark. However, the conference agreement preserves the principle agreed to by the Senate that the CETA countercyclical jobs programs should be phased down sharply in fiscal year 1980.
For fiscal years 1981 and 1982, the conference agreement assumes the continuation of funding for most programs in this function at the fiscal year 1980 levels. The only major exceptions are the CETA countercyclical jobs program, which is assumed to phase out entirely by the end of fiscal year 1981, and the work incentive (WIN) program, which is assumed to phase out by the end of fiscal year 1982.
As I have already described, Mr. President, the conference agreement on this function would be changed by the amendment now pending before the Senate. The pending amendment would add $350 million in budget authority for this function in fiscal year 1980.
FUNCTION 550
1979
The conference agreed to revise the fiscal year 1979 ceilings for health programs to $53.0 billion in budget authority and $49.7 billion in outlays. These levels will accommodate supplementals for medicaid and discretionary health services supplementals.
1980-82
For fiscal year 1980 the conferees accepted the Senate totals of $58.1 billion in budget authority and $53.6 billion in outlays. In the medicare and medicaid programs, these levels assume savings of $0.3 billion in budget authority and $2.0 billion in outlays. This results from legislation aimed primarily at tightening Federal reimbursement to health care providers — including some form of hospital cost containment.
These savings are partially offset by an increase of $0.2 billion in budget authority and outlays for medicaid benefit expansions. Included within the totals for the medicaid program are savings of $0.4 billion anticipated as a result of the administration's efforts to curb fraud and abuse in this program.
Also assumed are adequate funding to keep research programs constant in real terms, and a reduction in funding below current law for health education and training programs of $0.1 billion in budget authority and outlays. This reflects half of the President's proposed reduction in these programs.
For fiscal years 1981 and 1982, the conference agreement is consistent with an assumption that the savings implemented in fiscal year 1980 will increase. Discretionary health service programs would continue at current law levels. Research programs would continue funding at current policy levels, while health education funding would be reduced below current law levels.
FUNCTION 600
1979
The conference agreement set revised fiscal year 1979 ceilings for income security programs at $194.15 billion in budget authority and $161.1 billion in outlays. These are virtually the same levels as agreed to by the Senate. They allow for a food stamp supplemental sufficient to prevent food stamp benefits from being reduced during this fiscal year.
1980-82
For fiscal year 1980, the conference agreed to targets of $214.8 billion in budget authority and $183.3 billion in outlays. These targets reflect the policies assumed in the Senate-passed resolution in all areas except in subsidized housing and in railroad retirement. Other changes from Senate-passed levels are due to technical adjustments.
These totals assume outlay savings of $0.2 billion in social security retirement and disability programs, with larger savings in future years. The President's proposals to raise railroad retirement payroll taxes and lower benefits are not assumed.
Starting in fiscal year 1980, outlay savings are assumed from the institution of once-a-year, rather than the current twice-a-year, cost-of-living adjustments for Federal annuitants.
Fiscal year 1980 savings of $0.4 billion in budget authority and outlays are assumed in public assistance programs. The conference agreement would allow the current law spending ceiling on the food stamp program to be raised or eliminated to avoid a reduction in the level of benefits provided under current program guidelines.
Savings of $0.3 billion in budget authority and outlays in fiscal year 1980 are assumed in the school lunch, special milk, and other nutrition programs.
The conference agreement assumed an increase of $3.2 billion over the Senate level in budget authority for subsidized housing. Still, this level constitutes a reduction in funding for subsidized housing below current law levels. This target would allow for 286,000 additional assisted housing units per year if the current program mix were altered to make more use of existing housing.
The conference agreement assumes increased funding for refugee assistance, consistent with the President's request; and a continuation of current law funding of the emergency fuel assistance program for low income households.
For fiscal years 1981 and 1982, the conference agreement is consistent with continuation of funding for most income security programs which reflects the policies recommended for fiscal year 1980. The agreement does allow for the implementation of a welfare reform initiative in fiscal year 1982.
FUNCTION 700
1979
The conference agreement set revised fiscal year 1979 ceilings for veterans programs at the Senate-passed levels — $20.4 billion in budget authority and $20.2 billion in outlays.
1980-82
The conference agreed to fiscal year 1980 totals of $21.2 billion in budget authority and $20.6 billion in outlays. These levels provide for cost-of-living increases in the veterans compensation program and in the GI bill program as well as for current law funding for veterans' hospital and medical care programs.
They assume enactment of reforms eliminating duplicative benefits in veterans income security and readjustment programs. Also assumed is enactment of the President's proposal to require that private insurers reimburse the VA for medical care provided to veterans covered by private insurance policies.
The conference agreement is consistent with an assumption that cost-of-living increases will continue to be provided for veterans compensation programs in fiscal years 1981 and 1982. Other programs are assumed to continue at current law levels.
FUNCTION 750
1979
For administration of justice in fiscal year 1979, the House conferees accepted the Senate ceilings of $4.2 billion in both budget authority and outlays. These ceilings will accommodate supplemental appropriations for expenses related to recently authorized additional judgeships.
1980-82
For fiscal year 1980, the House conferees also accepted the Senate's targets of $4.2 billion in budget authority and $4.4 billion in outlays. These targets are $0.1 billion below the President's budget authority request for criminal justice assistance, and are expected to require significant appropriations restraint regarding Federal criminal justice assistance programs.
For fiscal year 1981 and fiscal year 1982, the recommended targets assume continued funding for criminal justice assistance at the reduced level recommended for fiscal year 1980. For Federal law enforcement and other administration of justice programs, the targets generally allow for funding at levels somewhat below what would be required to offset the effects of inflation.
FUNCTION 800
1979
For general Government in fiscal year 1979, the House conferees accepted the Senate ceilings of $4.3 billion in budget authority and $4.2 billion in outlays. These ceilings will accommodate the
proposed supplemental appropriation to complete the Hart building.
1980-82
The conference agreement for general Government for fiscal year 1980 is only slightly changed from the Senate-passed level. The conferees chose to target funding for legislative branch and other general Government programs at $4.4 billion in budget authority and $4.3 billion in outlays. These targets should allow aggregate funding for the legislative branch and other general Government programs to be adjusted upward to offset the effects of inflation.
Similarly, for fiscal year 1981 and fiscal year 1982, the targets also assume funding at levels that approximately offset inflation.
FUNCTION 850
1979
For general purpose fiscal assistance in fiscal year 1979, the conference agreed on $8.65 billion in budget authority and $8.75 billion in outlays. This represents an increase of $0.15 billion above the Senate-passed levels in both budget authority and outlays. The House conferees intend that this increase be used to accommodate a supplemental appropriation for temporary targeted fiscal assistance, if necessary authorizing legislation is enacted. The Senate conferees believe that any such fiscal year 1979 decision must be made in conjunction with a fiscal year 1980 decision on the major programs of general purpose fiscal assistance.
1980-82
For fiscal year 1980, the conference agreement provides funding for general purpose fiscal assistance of $8.1 billion in both budget authority and outlays. These targets, $0.4 billion below the Senate-passed levels, symbolize the possibility that Congress may consider changes in general revenue sharing and possible enactment of a new program of targeted fiscal assistance.
The conference substitute does not specifically assume either that general revenue sharing will be reduced or that temporary targeted assistance will be enacted. For my part, I will continue to support the position of the Senate, which was not conceded in the conference, that general revenue sharing should be continued at current levels. In this event, the function 850 targets would have to be adjusted accordingly in the second resolution.
The conference compromise for fiscal year 1980 is also reflected in the fiscal year 1981 and fiscal year 1982 targets, which have been similarly reduced by $0.4 billion below their Senate-passed levels. As with the fiscal year 1980 targets, these may require adjustment when the second budget resolution is considered.
FUNCTIONS 900, 920, 950
1979
For interest, in fiscal year 1979, the conference agreement provides budget authority and outlays of $52.4 billion. This is identical to the amount set forth in the Senate resolution.
For allowances, the conference agreed to budget authority and outlays of $700 million, also identical to the Senate figure.
For undistributed offsetting receipts, the Senate figure of –$18.1 billion in budget authority and outlays was agreed to.
1980-82
For interest, in fiscal year 1980, the House and Senate resolutions set an identical figure of $56 billion. The conference accepted that amount.
For allowances, the conference agreement provides for budget authority and outlays of –$100 million. The Senate resolution assumed savings of $400 million through reductions of $200 million in film making and $200 million in non-defense travel.
The House resolution assumed savings of $1.1 billion through reductions of $500 million in Government travel, $200 million in film making, $200 million in procurement of supplies and materials, and $200 million in consulting contracts.
The conference agreement assumes that savings of $900 million can be made. The Appropriations Committee must carefully scrutinize requests for appropriations in these areas in order to assure compliance.
For undistributed offsetting receipts, the conference agreement provides for budget authority and outlays of –$19.7 billion, the Senate figure.
Estimates in the Senate resolution for interest and undistributed offsetting receipts in fiscal years 1981 and 1982 were not affected by the conference agreement. In the allowances function, the reduction of $900 million in Government expenses is assumed to continue in fiscal years 1981 and 1982.
ALLOCATION TO SENATE COMMITTEES UNDER SECTION 302 OF THE CONGRESSIONAL BUDGET ACT
Mr. President, section 302(a) of the Congressional Budget Act provides that the statement of managers accompanying the conference report on the first budget resolution shall include an allocation of the budget totals among the committees of the House and Senate. This is the so-called crosswalk provision.
The allocation to the Senate committees under the conference agreement are contained in the statement of managers accompanying the conference report on House Concurrent Resolution 107.
Mr. President, consistent with the multiyear budget presented by the conference committee, allocations to Senate committees have been prepared for fiscal years 1979, 1980, 1981, and 1982. For fiscal year 1981 and fiscal year 1982, the crosswalks are based on the Senate-recommended totals for those years that are contained in the conference agreement. The Senate Budget Committee will use these crosswalks as a basis for comparing the cost of legislation reported for the relevant fiscal years.
The House, on the other hand, has only filed crosswalks for fiscal 1979 and fiscal 1980.
Under these circumstances, Senate committees will only be able to consult with their House counterparts as required by section 302 with respect to fiscal years 1979 and 1980. Therefore, crosswalk reports to the Senate under section302(b) are mandatory only for these 2 years.
However, the Budget Committee encourages Senate committees to file reports for fiscal years 1981 and 1982, as well as for fiscal years 1979 and 1980. Such action by Senate committees would express their strong commitment to the multiyear budget overwhelmingly adopted in the Senate budget resolution and supported in the conference agreement.
Compliance with these outyear targets in the crosswalk will assure Senate compliance with the multiyear budget plan for a balanced budget beginning in fiscal year 1981.
CONCLUSION
Mr. President, I strongly urge all Senators to support this conference agreement today and throughout the next 3 years as we consider the spending and tax legislation which must be made to fit within it. In my view, this multiyear budget plan is the best prescription for strengthening the public's confidence in the ability of the Federal Government to cope with and to resolve our financial problems and to balance the Federal budget.
Finally, Mr. President, again I want to express my sincere appreciation to the ranking minority member, Mr. BELLMON, and to the other Senate conferees for their splendid effort, cooperation, and loyal support in the conference and in bringing this report to the floor for consideration today. I wish to express my thanks also to Chairman GIAMO and to his conferees for their work.
Let me also take this opportunity to acknowledge and express our committee's gratitude for the high level of consideration and support which the majority leader (Mr. BYRD) continues to give to the entire budget process.
Finally, I want to commend the staff of the Congressional Budget Office and of the Budget Committee for their superb and tireless performance over the months leading up to this report. In particular, I wish to thank Jim Capra of CBO and his staff for their support. They made it possible to produce 3 full year budgets by mission and function.
We have come to expect such extraordinary efforts from the staff of the Budget Committee and CBO, but we are nonetheless deeply grateful for the high caliber of their work and for their dedication to the congressional budget process.
ERRATA
Mr. President, corrections should be made in the conference report as follows :
(1) On page 5, in Section 2(b), change "Section 801(a) " to "Section 301(a)."
(2) On page 8, in the table, line reading "real GNP," in the column under "1979," change "1,342" to,"1,432."
(3) On page 10, line 3, change "1982 outlays of $64. billion," to "1982 outlays of $8.4billion."
(4) On page 18, at the end of line 13, delete the period, and insert "and outlays of $52.4 billion."
(5) On page 21, in the table, line reading "debt subject to limit" in the column "'House passed," change "884.723" to "884.733."
Mr. President, at this time, I yield to my distinguished colleague and source of tremendous strength in the Budget Committee, Senator BELLMON.