is for real, that these are new times in wisconsin. i think there are new times in this country. and again, it's a battle of whether we want a country of more makers or more takers, and i think that we are proving that in wisconsin spent wisconsin is a red state. will you guarantee that your nominee next year will carry wisconsin? >> guest: will i guarantee? i think we will win wisconsin. i think we will do very well there. it will be a battleground state, and i think -- it's a red state. i will give you your guarantee. >> isn't a purple state more accurate? >> guest: i think a purple state can go read. as long as people are focused in on economic issues in wisconsin which they are, people are fiscal conservatives in wisconsin like i think they are in most places around the country and i think we went on those issues and those of issues governor walker is talking about. >> talk about the senate bill

does. will your party take back the senate and if so what are the key races they need to win? >> guest: listen, i'm not going to say it's a key race but i think you ought to watch how i think the site in nevada and the typical race as we talk about, i think you should watch wisconsin. >> who will challenge? >> guest: i do want to get into that right now, jonathan. but i just think you'll see a replay of the feingold race in wisconsin. i know they seem very different types of candidates. but i think it's the same message. its fiscal message. it's an out of control deficit. out of control debt ratio to our economy. herb kohl has been complicit. my guess is purple isn't going to run and i think you will see a couple strong candidates, and i think -- i haven't talked to paul about that. >> final question. >> in midterm elections a republican primaries were very combustible if you will because

of the tea party movement. the main senate race, show the republican establishment support senator olympia snowe? >> guest: i think we have to leave that up to the voters expect you won't endorse the incumbent senator? >> guest: i had to support whoever wins the primaries. part of my job is to support the republican nominee. so for me to improve myself into a primary debate whether the in indiana, whether it be in maine, whether it be whatever we're talking about, i can get involved in and i won't. >> in terms of retaking the senate the bill if it happened to be the one seat that democrats wouldn't pick upan faq party candidate would win, would that be worth the? >> guest: i'm going to support whoever wins. >> could you clarify, is rnc policy do not get behind and come it says but to stay out of primaries? >> guest: it is never for the rnc to be involved in primaries.

>> just for incumbents? >> that's right. there are certain rules that would have to follow in order to get engaged in a republican primary. i'll let john cornyn answer that one. >> that's it. if you could get a message to speaker boehner at this point? >> guest: keep up the >> in a couple of minutes, our coverage of the house republican 2012 budget plan begins with paul ryan. also, remarks from the ranking member, chris and holland. >> as a host and a traitor, you are not necessarily a republican or democrat, you are simply looking at the impact of what government is doing on the financial markets. whether it be oil markets, trading, or wall street firms. >> tonight, the cnbc fast money

anchor, melissa lee. watch the rest of the interview tonight at 8:00 on "q&a." you can download the pot test on our signature interview program, online, c-span.org/podcast. >> you are watching c-span, bringing new politics and public affairs. every morning, "washington journal. weekdays, the u.s. house. also, weeknights, supreme court oral arguments. you can see our interview programs on the weekends, sunday we have a "q&a" and "prime minister's questions." id is all searchable at our c-

span video library. c-span, washington your way. a public service created by america's cable companies. >> late on friday night lawmakers announced an agreement on the federal budget, preventing a federal budget shut down. now i look at the house republican proposed 2012 budget plan with paul ryan. hosted by the american enterprise institute and runs for almost one hour. terprise i just under an hour. >> this morning paul ryan presented the house republican budget to his colleagues on

capitol hill. budgets are not just financial documents. they are moral documents. they speak volumes about our priorities on how we govern ourselves, see our future, and the country that we choose to pass on to our children. they tell a story about our character. paul ryan understands this and today comes to us to talk not just about the but of the budget, but the why. he joins us here in believing that freedom, the art of america, is painted on many campuses. the government budget is one of them. the congressman has been here many times in the past year and as always it is an honor for us to host him as he presents his courageous work for the future of our nation. he will speak for about 20 minutes and then host his own question and answers. please join me in welcoming

congressman paul ryan. [applause] >> arthur, thank you very much. >> arthur, thank you very much. but by wanted to thank everyone here at the american enterprise institute for your warm welcome. budget debates circling around the state capitals, they seem disconnected from reality. the new stores are full of phrases le continuing resolutions and baseline levels, and the numbers are in millions and billions. the srecard is these days about political posturing and partisan edge. this debate is stable. -- stale. today we are going to give americans the debate that they deserve. we face a monumental choice about the future of our country.

for too long, policymakers from both political parties in washington have travel the path of least resistance. easy promises and into claims of progress. relentless spending in constant borrowing. this path has left us on the brink of national bankruptcy and continuing down it will push our nation into a debt crisis characterized by uncontrollable interest rates, unsustainable taxes, and economic collapse. we would leave our childrea very different nation than the one we inherited. highly centralized and highly bureaucratic, less self- governing and less free. the president whose budget punted on the drivers of our debt is not the first public official to direct is down that path. and the members of his own party who are defending his do nothing approach while demagoguing our solutions, they're certainly not

the first either. in recent years, both political parties have squandered the public trust. the american people had a majority and they reject in to promises from a government that cannot live within its means. they deserve the truth about the nation's fiscal and economic challenges. they deserve and demand on this leaders who are willingo stand for solutions. this new house majority which it is my privilege and pleasure to serve as the budget chairman has decided to do things differently. we have decidedo offer americans the twist that they deserve. the stakes are very high. they transcend what fraction of a worker in madison continues to his benefit packages and the billions we finally settled on as we try to repair this year's broken budget process. at stake is the security and

stability of american families. at stake is a potential prosperity of american workers. at stake is america. it is that that posing an existential threat to all that we hold dear, if we truly believe that our current path leads to a crisis and the demise of america's exceptional promise, then let's dispense with all the triviality. let's confront the nation's most urgent fiscal and economic challenges. let's talk the path to a brighter future. but restore america's promise in ensure real security through real reform. the path to prosperity is the budget we are offering today. it represents our choice for america's future. it represents our commitment to the american people. we aim to restore the dynamism that is defining america over generations. on leasing the genius of

america's workers, investors, and entrepreneurs, and strengthening the foundation of economic growth and job creation now and in the future. we reward work and effort. which is about the idea of unlimited and unrestrained government. instead, we call for government limited to its core constitutional functions and faithful to its noble mission to secure life, liberty, and happiness for all. now more than ever, it is vitally important that we act. the governments and foreign predict unfunded liabilities which promises that they made to current workers about their health and retirement security for which it has no means to pay are projected to grow by tens of trillions of dollars in the coming years. every year that congress fails to act, the u.s. government gets closer to breaking promises to

current retirees. while adding to the large and growing stack of empty promises to future generations. the flood structure of our biggest government programs is by no means the only reason the we find ourselves facing the crisis. the president and the last congress introduced current agencies and they failed to deliver from their promise to create jobs. the biggest gap in the wng direction of the last two years was the creation of two new open-ended healtcare retirements which would accelerate our path of bankruptcy. programs to make of this safety net for the poor are failing the citizens who rely on them and the taxpayers who fund them. in the tax code, it is riddled with inefficiencies creating a very drag on the economic growth is this -- needed for a sustainable future the president's proposal would

celebrate a descent into a debt crisis. it doubles the debt held by the publict the end of his first term, and troubles of by the end of his first budget. it imposes new taxes, with spending never falls below 23% of our economy. it permanently in large as the size and scope of our government. it offers no reform to help retirement programs and no leadership. our budget is different. first of all, it cuts $6.2 trillion from the president's budget over just the next 10 years. it does the nation on a path to actually pay off our debt. and it lowers the debt as a percentage of the economy now until we pay it off. our proposal bring spending on the federal government, the size of federal government, back to 20%, coistent with the post- war average and reduces the deficit by $4.4 trillion. our budget tackles the biggest fiscal challenges head on. it is a plan for job creation

today, ensuring our children inherit an america tt is more strong, more prosperous, and more free. as generations in the past to ensure for us, the four major aspects of this budget reform agenda -- first. this budget reforms government to make possible more efficient and responsible government. second, it builds on the welfare reform efforts in the 1990's and strengthens the social safety net. third,his budget helps fulfill the mission of health and retirement security for all americans. fourth, it reforms the tax cut to promote economic growth and job creation. by removing the anger of debt that weighs down our economy and by advancing pro-group tax reforms, this is a jobs budget. it's a signal to all that a brighter future is still possible to invest in america.

american can still be the growth engine that it ought to be. and that is from the heritage center for debt analysis, projecting 1 million jobs next year alone. bringing the unemployment rate down to 4% by 2015, and results and additional private-sector jobs in the last year of the decade alone. according to this analysis, it spurs economic growth with over 1.5 trillion dollars in real gdp over the debt. this is that it will raise wages by $1.1 trillion, an additional family income each year. this is a path to prosperity. it began by reforming government. the role of the federal government is both vital and limited. when government takes on too many tasks, it does not do any of them very well. this budget restores limits to government in order to reduce deficits, said money for taxpayers, and focused federal the paw prints and agencies o the critical missions. the first job of government is to secure the safety and liberty

of its citizens. defense spending should be executed with greater efficiency and accountability, no two ways about that. but our men and women in uniform should never be thought of as mere line items in a budget spreadsheet. it follows the lead of secretary robert gates, getting savings from going after in efficiencies at the pentagon but reinvesting $100 billion in to keep military capabilities before putting to st toward deficit reduction. other government agencies have important roles to play as well. but the budgets for many of these agencies have grown far beyond what is justified by their properly limited missions. domestic government agencies enjoyed a 24% increase in their base spending since the president took office. nearly 85%, when you include the stimulus funds, and the massive dget increases of a last two years has served not to help these agencies meet existing missions more effectively but to

create things that lie beyond the scope of the federal government. whether an excess of epa over -- or the implementation of of disasters in health care law. this budget restores discipline to a government that badly needs it. he returns spending levels to 2008 levels and freezing it for five years. it does this not through indiscriminate cutting up by proposing the elimination of dozens of wasteful and duplicative programs, identified by nonpartisan watchdog groups and government auditors such as the general accountability office. it does not just call for the government to spend less. it calls for the government to focus on creating the conditions for prosperity instead of micromanaging the economy. washington should not be in the business of picking winners or losers in the marketplace. jobs are not created when politicians reward the connected cronies with favoritism.

and jobs are created when we choose economic freedom. our budget targets corporate welfare and proposes programs like privatizing fane mae and freddie mac, costing taxpayers hundreds of billions of dollars. he gets rid of a permanent wall street bailout of authority and rolls back expensive handouts for uncompetitive sources of energy. instead, it calls for free and open marketplace as for energy development and innovation. it proposes the role of moratoriums on se, responsible energy exploration here in the united states and in washington policies that drive of gas prices and unlike some of america's vast energy royces up -- resources to help lower costs and create jobs and reduce our dependence on foreign oil. if we want these reforms to last, then it is not just enough to change how much government spends. we must change how the government spends.

this budget contains several budget process reforms, including real enforceable caps on spending double reorient -- double reorient government to spenonly as much as it needs to fill its constitutionally prescribed rules. many of these companies fiscal commission i took part in. the second part of our reform agendas seeks to build on success of a bipartisan welfare reform of the 1990's. in wisconsin we paid -- pave the way for this. we supported safety net for americans who through no fault of their own have fallen on hard times. however the government programs that make up the safety need are coming apart at the seams. it should come as no surprise that a system designed in the 1960's is not equipped to deal with any pressures of the 21st century. bipartisan efforts in the late 1990's transformed cash welfare by encouraging -- limiting the duration of benefits and giving states more control of the money

being spent. but cash welfare is only one of 77 means tested federal government programs. others including medicaid, food stamps, and housing aid were left on modernize and on reform. this budget completes the work that was left undone with reform centered on individuals and led by governors at the state level. predicate suffers from the same flawed structure that welfare used to suffer from. the federal government provides an open ended match on what the states spent on medicaid, which creates preserves incentives. states are unable to save money by tailoring the program to meet unique needs of its citizens. instead they must obey the one- size-fits-l federal mandate. the only way they can save money at all is by cutting reimbursements to doctors and hospitals. this is why so many doctors refuse to see medicaid patients. the payment rates are so low, they are losing money every

time a medicaid recipient walks into their office. this budget of poses -- proposes and into the one-size-fits-all approach. it converts medicaid into a block grant and cuts the excessive federal strings, freeing states to design programs that work best for their residents, giving states more flexibility, which will allow them to create more options to give access to better care. this budget process proposes similar reforms to the food stamp program. it ends the same incentive structure their reward states for signing up higher numbers of recipients as opposed to resort -- rewarding results. the best welfare program is one that ends with the job and a stable life for the individual. this budget and strengthen and streamline consolidating dozens of wasteful and duplicative programs into unaccountable, targeted career scholarships aimed at empowering american

workers with the resources they need to pursueheir dreams. the third part of our reform will put the end to the empty promises from the government going broke. people have organized their lives around these programs. people have based their retirements around programs. we need to honor that. but we also need to make sure that future generations of seniors actually have something they can count on. i cannot tell you how many people at my age bracket just do not think any of these things will be around for them. that's fixes sohat they are. we start with saving medicare. thopen ended blank check nature of medicare subsidy mechanisms is threatening the solvency of this critical program and it is creating inexcusable levels of waste in the system. everyone who is on medicare or knows someone on medicare has

stories about waste in the system. unnecessary tests, redundant treatments, the cost of time and money of mistaken billons comer misplaced records, and just outright fraud. this kind of waste -- let me be clea -- it is inevitable in a top down, government-run system. and it translates into runaway health inflation. this budget repair is medicare costs broken structure and saves the program for current and future beneficiaries. the principle that government should reorient its policies without forcing people to reorganize their lives, the budget reform does not affect those nearing retirement in any way. instead, and people 54 years old and younger become eligible for medicare, they will be allowed to cose from a list of medicare-approved coverage options and pick a plan that best suits their needs. more individual choice, more competition. medicare would then provide a payment to subsidize its cost.

this plan is a difficult to the system that members of congress and other federal employees enjoy today. it is similar to the drug benefit which worked very well. name another program that came in 40% below cost projections. because this one has choice. it will preserve better care among health plans by the millions of seniors to get to choose and by trimming billions in waste and fraud. on this plan, medicare will provide assistance while providing more assistance to lower come beneficiaries and the with greater health care risk. reform that empowers individuals with a strengthened safety net for the poor and the sick will guarantee that medicare can fulfill the promise of health security for america's seniors. it is also necessary to reform so security to prevent severe cuts in benefits in the future. this we run out of iou's,

budget for his policy makers to come to the table and work to enact common-senefefefefmsef it does this by requiring the president to submit a plan for restoring balance to social security trust funds and requiring congressional leaders to put forward their best ideas as well. this process is designed to yield a bipartisan solution quickly and this is one area while i still hold out hope that there is a bipartisan agreement out there to be achieved. we know the way for a year. the president's bipartisan fiscal commission provided an example of what needs to happen to make so social security solvent. it is growing more slowl and those more vulnerable to economic shock in rirement. they also proposed will forms that a call for increases in longevity, to gradually reflect the demographic changes that are straining social security financing. although budget is sell -- i

support both of these ideas. the goal of our budget is clear. we must save social security for current retirees and shrink it for future generations. this budget achieves -- strives to achieve retirement security, economic security, and fiscal sustainability. but none of this is possible, you can i get it done, on as w have economic growth. this brings me to tax reform, the fourth part of our agenda. this budget regnizes that the nation's fiscal health requires a vibrant, growing, private sector and the tax code that is simple, efficit, and fair. unfortunately our current system fails on all three accounts. this budget attacks complexity, and inefficiency, and on fairness in a code with fundamental reforms drawn from a broad consensus of economic experts and based upon the principle that government should never take the dollar from one of its citizens and thus the

dollar is needed for absolutely vital national purposes. it draws on the commonly held view that the key to pro-growth tax reform is to lower tax rates walt broadening the tax base. letting people keep more of the money that they have earned of getting rid of the distortions and the loopholes that deferred economic resources from the most efficient uses. it starts out by asking the right mix of tax increases and spending cuts to balance the budget, and asking what is the purpose of government. then raing only as much revenue as the government needs to fund the things it i supposed to be doing. in 1981, president ronald reagan inherited a stagnant economy with a tax code that featured 16 brackets and a top rate of 70%. when he left office, the tesco had been supplied to three rates of the top rate of 28%. over time, brackets' became added.

as with so many things, we need to get back to the reagan model. in this case, bayh implemented the policies of growth. this budget begins by lowering taxes, with the top individual and corporate capped at 26%. it adopts a revenue-neutral approach by eliminating loopholes that distort economic activity. this budget takes is a major problem that has distorted economic activity over the last two years. it refers are -- its reforms are designed to be pernent changes in law, not every boosters. america's families and businesses need and they deserve certainty and predictability when it comes to their taxes. they need to be able to pn for their economic future. let me close with this. erica is drawing perilously

close to a tipping point it has the potential to curtail free enterprise, transport it to transform our government, and weakened our national identity is in ways that may not be reversible. it represents too dangerous. -- two dangerous. -- dangers. has the power to makeecisions to strip from individuals and their elected representatives and given an unelected bureaucrats. this chart a new path, a new federal commitment of assuring this nation's workers, investors, and entrepreneurs that we recognize the threat that unlimited government poses to the american way of life. it affirms our cherished ideal of individual liberty, and equal opportunity, and self-reliance.

these of the ideals cultivated in the exceptional american character. aei has been a champion under leadership.ks' just as this budget seeks to make them the guiding light of american fiscal policy once again, freeing individuals by restoring to the size and scope of government should not be a partisan issue. in his state of the union address on january 4, 1935, president franklin delano roosevelt road and the nation of a threat to america's national character from permanent dependency on the goverent. and let me quote -- confirmed by the evidence before me show conclusively that continued dependence on relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber. to dole out relief in this way is to administer a narcotic, a

subtle destroyer of the human spirit. it is in violation of the tradition of america to give -- of america." this budget offers america of mobled government that is guided by the timeless principles of the american idea. this budget provides policymakers with a blueprint to put our budget on the path to balance in our economy on the path to prosperity. this budget assures a america's seniors from those currently retired and future retirees, that their health and retirement security will be strengthed and preserved. this budget provides parents with the hope that their children will inherit a strong, free, and prosperous america. it is a plan to give our children a debt-free nation said that they can realize the american dream. this is submitted for consideration of the u.s. congress and to the american people. this budget marks the new house

majority of us answer to histories call. it is up to all of us to work together to keep america exceptional. thank you very much. [applause] questions, anybody? >> thank you, chairman ryan. we appreciate your remarks. of work for a school that focuses on world schools, particularly high poverty place. i didn't hear you mention the word education once. we're in the process as you know of reauthorize the secondary and the exctation is

investing in competitive grants. where is the majority in the house going when it comes to reauthorization? where does that fit into your principles? >> you will have to ask about half he plans on we authorizing. they are working with arne duncan on that. we are setting a cap on discretionary spending. it is up tohe committee to prioritize it. he did not get down to the mike carona specifics. we said the cap. then congress passed to prioritize that. of this is an area where the government is more deeply involved. only 6 cents on the dollar comes

from the federal government. it is the constitutional responsibility of the states. we have 49 different job training problems. none of them are measured. we do not know that they are working to get people into work and care rears. we are trying to do it consolidation. that is where we spend a lot of the time and education. that is more of a federal responsibility. >> reduce spoke about taxes. what can you tell us about what the ways and can means -- ways and means committee is likely to do?

>> the tax reform was given to me by the member. we were closely together. what he is planning on doing is broadening the tax base, loring the rate to a condensed shropshire. it when you broaden the base, you have to get rid of some loopholes. we will figure out precisely how to do that. you'll see a broader tax base on that. the key thing is to not raise taxes on capital for investmt. you get higher wages and more job creation. it is not inconsistent with the direction. they went to a little farther. they charge a higher rate than we do.

they had $1 trillion in there. we do n raise taxes and back. we get rid of the obama care taxes. they are not imposing a $1.50 trillion tax increase that president obama is imposing. that is where we do our tax reform. the guy next to you. i do not remember your name. >> tomoburn has proposed raising -- removing a subsidy. would you be ok with removing it? >> i've always voted against it. it is 5 miles from my house. we do a lot of this. i do not think it is smart policy. the money did not go to the farmer any way. i've been it is the smart way to

go. it asked me my opinion, that is a bit. >> congratulations on a lot of hard work. during the worst part of the economic crisis, my company is one of the most important. they are invested deeply in research and development. we have to have the research. i am wondering what role y see for the continued federal investment. cracks in the particular credit? on the tax side, i hate to do it. they will decide the makeup of how broad the tax base is.

on the spending side, we are going afte corporate welfare. we are going after applied research in going after basic research. there is a basis. the applied research is the government picking winners and losers. did they do not pick well. >> i will go over here. i apologize. >> are you counting on increased revenue from domestic oil and gas production? >> we basically open up the ocs and we do get bonuses. the royalties to not come in and out cited the tenure window. it takes time. we get bonuses up front. we assume royalties later on.

that is not in our score. >> i do not know anything. >> a few people had their hands up. >> do you -- have you began your own plan to address such security reform? is awaiting and other proposals that spikes we will have it -- or is it waiting on the other proposals? >> we will have it in the future. i do think there is a shot at some bipartisan agreement. we are trying to set the table for that. where tried to put in place a process that requires harry reid to own up to the fact that we do have a problem. many of us will be submitting a plan. we are talking about getting behind someby's plan. i do plan on working on that. >> you did not put forward this? >> we went back and forth on this. we thought that if we put one

out there it should be too tempting for the democrats to attack. this requires a submission of plans to come with procedures to act on. we believe that this will give us the best chance. it is insolvent. we need to fix it. we do not want government help care. that is what obamacare does. map ways. that is a chance to come together. we are trying to advance it.

>> on the medicare proposal, he had me -- you have made the difference. while i get the mechanical difference, they are not be a voucher that people then purchased insurance with. it would go to the plans. though there there is a mechanical difference, at its is hard to see the this. >> they achieve theame kind of savings path. my road map does have doubters. i worked with the director in the clinton administration. i think she was chair of the fed. she and die with the chairs of the task force.

we agreed on a structure. cbo called the premi support. it looks more like progress people are already familiar with. it is a people do not inaccurately or incorrectly tried to tell us what we are doing. >> as long as this is not include comprehensive reforms. kenny talk about how we still have a health care system with the current tax code -- can you

talk about how you still have the health care system of the current tax code? >> we are planning on moving through ways later on. we have not come together to finish that yet. that is why he had helcare for the over 65 population appeared we have aot of other things in here. we are going to be working on our legislation together. i believe it is one of the drivers ohelp inflation. you are subsidizing the wrong people. you have a hard time getting insurance. you have that benefit wherever

you go regardless of how you care health insurance. i think that is the best way to reform health care and get the consumer in the marketplace. i their health care will be run by 30,000 bureaucrats in washington with price control or three and a million americans acting as consumers demanding performance for our business. i have lasik surgery 11 years ago. otherwise i wouldn't. i paid about $4,000 for surgery in the year 2000. it is now about $1,600. it is a better procedure. it is something that has market procedure.

what we've what to do is apply this free-market principles so people can act on those things. >> is to save more than $1 trillion. the cbs said it will cost more than $2 billion. >> we retain the savings. during this combined with

eliminating all the spending get to the number. do we do repeal the price control mechanism that they put in medicare tt ends of rationing care. >> first of all, thank you for prioritizing the budget. if we do not mind, military families are concerned about the government shutdown and the bill that was proposed. can you give us an update? >> i can speak to the house. the decrats are our adversary. we are worried about this because you do not want to be

affected are the it spouses. the bill will bring to the floor guarantees that they keep getting paid while we cut spending. this will be our third that we will have passed. e senate has not done one yet. it has been 44 days since we passed our purse. nothing has come to prevent a shutdown. they are looking at to is moving as there it is the senate democrats and not the republicans. >>re you confident that you ve a consensus for the medicare one?

they are in groups of eight or 10 people. the biggest driver of our debt is the medicare problem. there are the kinds of things that are needed to fix it. they are on board. look, it all comes down to this. he can guarantee people of yardy organize their lives. they get what they have coming to them. do nothing and kick the can down the road. the need to start cutting seniors. it is brought if we reform. the question is when and how we

reform it. verys spending goes up quickly. do we say these programs now by engaging? do we just worry about politics? do we worry about the next election. we see a real problem where we do indiscriminate cuts to everyone. we do not want to have european austerity in this country. the compassionate things to do is to fix this on our side

rather than seeing more pain later. >> on the point just made, as you are speaking this morning, he are retaining giveaways report -- before forcing seniors to clip coupons before seeing a doctor. but i did not even know what to say to that. >> do you think the ground as been prepared for republicans for this coming debate? >> steve israel is the head of the committee. is this a political weapon? of course it is. their scoring these political points. here is the decision may have

been made -- we have been making. we nell are at the series will do it. we have these halos over our head. there is the crash of 2008. there are hundreds of banks going down. at if your congressmen and their preneedy were coming?

what if your president saw it coming? they know it in enough time to prevent it from coming. what would you think of him? i do not think of this spirited this is wrong. this is the most predictable economic crisis we have ever had in this country. we owe it to our men and women to fix it while it is fixable. shame on people who want to demagogued and politicize this. our country's better than that.

they have this budget gimmicks and county checks. is not what is really needed to save this country. >> thank you very much for speaking. i know you are here. they are going to have to get e ograms they like.

to many people think these cuts will not hurt. >> we are about to do a whole bunch. we are reforming agricultural subsidies. he is taking the lead in doing reform. we have people in congress now you are doing that. we have no choice.

>> use said -- he said that the president is not leaving on this. what do you do in the next year and have? >> as they said, we are going to do a budget. let's put the democrats decide. it will use this as a political weapon. look at the path they are on.

we are on a path where i debt goes from about 68% of gdp to 800% of gdp. i asked them to run the model. we have to go out and give the country a choice. we know the practice but the country on. it was in a welfare state. it is true to the country's founding principles that is prosperous and pro-growth. it has a resoluble safety net.

at least the country will get to choose what country they want from 21st century. we will put these decisions and place. they will determine what kind of country we will be. i feel like we have a moral obligation to our country and constituents to give them a choice so they can choose. at least in 2012 they will have a real choice. i have to botvote. >> do you regret vot yorke on tarp? no, i >> hate it.

i do not regret it. i do believe it is to announce a too unknown. we would have seen lots of businesses could down. in the panicked moment we are in, but i think treasury and the fed did contribute to the panic. in the loma we are in, it had to pass it from taking place. was it administered correctly? no. thank you. [captioning performed by national captioning institute] [captions copyright naonal cable satellite corp. 2011]

>> coverage of the republican in 2000, -- 2012 budget continues. representative chris van holland says it reserves to much for the wealthy and the oil companies. his remarks or 45 minutes. >> the afternoon. thank you for joining us. i am pleased to be here with my colleagues.

we have a new member from the democratic caucus from california. we are here today to respond to the house republican budget. we welcome an honest, vigorous, and respectful debate about the best way to move the country forward, to keep our fragile recovery going, to create jobs come and to reduce the deficit. we all agree we must act now to put in place a plan to reduce our deficit in a steady, predictable, and responsible manner. the question is how do you best do that? as the bipartisan fiscal commission has indicated, on an irresponsible efforts -- any responsible effort requires a balanced approach requires standards and revenue. this house republican plan fails that very simple task.

you just have to hear the comments that were just made today by both alan simpson and erskine bowles. bowles. i read from there's demand. : the republican plan falls short necessary to enact irresponsible plan." republican plan largely exempts defense spending and would not apply any of the savings from eliminating or reducing tax expenditures as part of tax reform through deficit reduction." as a result, that the german's plan relies on much larger reductions in discretionary spending while calling on savings in safety net programs, cuts that would place a disproportionately adverse impact on certain disadvantaged population. so we have already had the verdict rendered by the leaders

of the bipartisan commission, that the republican plan in the house fails the simple test of balance. in fact, if you look at the republican plan, it is simply a recycled, rigid ideology that says we need to provide a tax breaks to the very wealthy and a very powerful at the expense of the rest of the country. it is dressed up in a lot of nice-sounding rhetoric about four, but it is the same tired old playbook. they preserve and in fact increase tax cuts for the very wealthiest americans. they keep in place a tax subsidy, taxpayer giveaways got to the oil and gas industries, and other special corporate interest costs, while it costuts

education , research, in science, requires seniors to go into a private insurance plan and at the winds of the insurance industry with constantly luring amounts of support, all the risk goes to the seniors. the government is to choose and we believe their plan will weaken america and the long run. it is not courageous to protect the most powerful interest in the very wealthy at the expense of critical investments in our country. that is they do going forward. i want to turn to these charts here, because it suggests they are way out of the mainstream when it comes to any responsible approach to deficit reduction. [unintelligible]

you all remember david stockman, the budget director during the reagan administration. he finds it unconscionable that the the republican leadership, faced with a 1.5 trillion dollar deficit, could believe is good public policy to maintain tax cuts for the top 2%. it increases the tax breaks for the top 2%, because when you lower the top rate tonk, you'reg to be hitting middle-income tax payers to pay for the brakes at the very top. i listened earlier to the chairman of the committee, chairman ryan, when he was asked why they continue the tax breaks andthe folks at the pretop, he said that was necessary for economic growth of. the facts tell a different story. what this shows is that tax

rates for the top income earners -- during the clinton administration, a period of rapid economic growth in which 4% gdp growth, compared to what happened when you provided the first tax cuts that disproportionately benefited the folks at the very top. he felt it very strongly, only 2.1% real gdp growth during those years, even though you had the lower tax rates. the point is there are a lot of things that move the economy, and clearly that is not a primary factor, and anyone interested in his and the deficit as opposed to another ideological agenda recognizes you have to address that part of the equation. this is a similar chart. it shows job growth during the booming years during the clinton

administration, when the economy was booming. again, during the eight years of the previous administration, when you had a lower tax rate for folks on top, you actually lost 653,000 private-sector jobs. the idea that those marginal differences tried major economic decisions is just this proven by the facts. here is the difference, when you look at the fiscal commission, in terms of balance. but the rest of the fiscal commission and the house republican plan when it comes to revenues over the next 10 years, $2.50 trillion. the commission assumed we would return to the clinton-era tax rates at the very top. when you make those significant cuts, as the representatives said, you are going to cut into important investments. they are important to keeping

our economy strong. we recognize there are cuts to be made in -- and gao has identified many of them, and you hear in a minute about why it is important to maintain those investments, and then you will hear from john yarmouth about the tax cycle. i want to turn to the question of health care. there has been a lot of debate over the last many years on the health care question. every member of the budget committee, every member of the budget committee, republicans and democrats alike, understand that rising health care costs represent a huge challenge for the federal budget, as they do for every family budget, because the reality is the health care costs in medicare and medicaid have been tracking the health care rising costs in the rest of

the health care system over the last 30 years. just the last 10 years, the growth and cost of medicaid is much lower than the increase of health care costs in the private sector. so when you look at this problem you have to recognize it is the challenge to get overall health- care costs down. and that is why passing the affordable care act last year was so important, because it is designed to drive down the costs per person of health care over the long run. in fact, we heard some talk earlier today from dr. rivlin's approach. when she talked a few weeks ago before the committee, she indicated it would be a huge mistake to repeal the affordable care act. and here is what she said.

"repealing it would cause needless economic harm and would set back efforts to create a more disciplined and more effective health care system." she also said, "i believe every idea about recalling about reducing costs was incorporated in some way into the affordable care act and we need to find it here " she said, "i believe the affordable care act as the potential to --" this is a chart put together by the medicare trustees based on their data that shows if you implement the affordable care act as it was passed, you will indeed bring down the cost of medicare over a period of time. i want to say a word about the so-called reforms in the

republican proposal. and i want people to focus on this fact. you may remember that during the last campaign republican candidates ran all sorts of ads against the democrats saying that these last $500 billion out of medicare. in fact, in an op-ed written for local paper, chairman of ryan said president obama broke his promises the seniors like cutting medicare by hundreds of billions of dollars. the reality, if you look at the budget, all those medicare reforms that we made, including ending the overpayments to medicare advantage, including other reforms, to bring down the cost of health care during the next 10-your window, it looks to us like they have kept a very

savings in their medicare -- in medicare that the railed against over the last couple months and years. in fact, that is the cause of the medicare number they have in the budget. the health care reforms enacted in the affordable care act, which they say they are repealing, they are not repealing all of them. they are keeping as far as we can tell the savings in medicare, and the savings that were made with the democratic majority in congress rec rit -- represent a significant amount of the funds available in medicare over the next 10 years. what do they do? the essentially and medicare as we know it. they do not reform it. .hey deform it they say you got to go into the

private insurance market, and we will get a voucher will reduce value over time, and all the risk of increased cost in health care system will be borne by the medicare beneficiary, the seniors. even as they get rid of the mechanism they kept, that they did not -- that they got rid of, and health care reform bill, which the creation of a commission, to help recommend and reduce costs. they got rid of that, which will lead to increases costs in medicare, and they put all the rest and burden on the senior citizen under medicare. it is a radical change, and it is extremely bad for seniors. finally, i want to say with respect to medicare, allison schwartz is got to talking about the medicare cuts.

i want to turn briefly to medicaid, but simply put, turning medicaid into a block grant program is just code for cutting deeply into supports for seniors in nursing homes, seniors in an assisted living facilities, low-income kids, disabled individuals, and a most deplorable population. it is the blank check the governors with a license to cut those individuals -- cut the support for those individuals in our society. it is certainly not courageous to pick on some of the most vulnerable in our society. finally, i will end by saying this notion, the orwellian notion that ending the medicare guarantee for seniors and block-

granting medicare that will help hurt individuals in nursing homes and other settings, to suggest that that is done to save medicare is a little reminiscent of that twisted saying that you have to this juror the bill in order to save it. this will do terrible damage to medicare and medicaid and everybody who has paid into the medicare system and relies on the system for their supports, and all of us know it was not that long ago that republican members of congress surely thought the establishment of medicare, the establishment of social security, and certainly we are not going to stand by while they undermine the fundamental integrity's of those important supports for seniors and others in our

society, which all of those seniors had paid into that system. with that, i'm going to turn it over to congressman john yarmouth, a great member of the committee from kentucky, who is got to talk about the republican approach to tax cuts for the wealthy. >> thank you very much, crossbhris. i ran for congress in times during difficult circumstances for americans, and fighting two wars, and the notion we should cut taxes for the wealthy was offensive and demonstrated the wrong values, and that was at a time when the social safety net was much better than it will be under the republican budget. mr. ryan calls this budget the path to prosperity.

it is actually a payback for the prosperous. this is a budget that asks virtually all americans to suffer, to take a little pain, but it has nothing -- it asks nothing of the wealthiest americans, the ones who have experienced the greatest in come and wealth in the last 10 years, at least in the last 90 years. what we have seen here under the ryan budget is a proposal that over the next eight years will reduce taxes for the wealthiest 2% of americans, by $870 billion, at the same time as crist mentioned and others will, cutting medicaid by $1 trillion, cutting education funding, cutting research and development, cutting support programs for low-income seniors and people with low-income families with children, all of the things that reflect well on how -- and our values as a

nation. they do not ask the wealthiest pay a penny. they maintain all of the tax breaks for the oil companies in spite of the fact that they have made $900 billion in profit over the last decade. they have maintained all the tax breaks, all the tax expenditures, which amount to one trillion -- $1 trillion a year, expenditures which if they were actually recorded on the budget as government programs, republicans would -- about, and there are -- as expenditures alone amount of all of the discretionary spending in the budget, including defense. they do not touch any of this. this is the most imbalanced, reckless budget that has been offered in modern history. it exacts a high price on virtually all americans accept

the very wealthiest. this is $800 billion versus 707 $1 billion cut in medicaid. these are the wealthy. those are the people who need care and need aid. i want to say one thing about this notion that you can -- you need to cut taxes to generate economic prosperity. my brother was in the barbecue restaurant business. he does very, very well. i am an investor and that business. we would be impacted to return to the pre-bush tax counsel. my brother said i'm going to support barack obama this year even though i was always republican and always wanted to pay less tax. he said i finally realized if nobody can afford a barbecue, it does not matter what my tax rate is. this is a statement about where we are as a country.

does not matter what these tax rates are for anybody if there is no business. business people recognize that. we had a meeting yesterday, white house business council roundtable, all business people in the room. sponsored by the chamber of commerce. everybody in that room was asking for more government support for education, for things like child care, research and development, and i thought i was in a progressive caucus meeting, and these were business people. they did not mention tax rates on the wealthiest people in the country. they need -- they know we need to make the investment in human capital. this budget does not do that. it imposes great pain on the people who can least the stand it and gives great benefit to the people who do not need it. >> thank you, john. next we are going to hear from a new member of the committee, who

is got to talk about keeping investments to keep the country strong. >> thank you. i am impressed with the work of my colleagues in the democratic ranks have done in the last several weeks to bring some balance to the equation. i firmly believe that america needs and deserves a plan that creates jobs, not cost jobs. and that plan for america and her work -- and for working families requires that it be written with courage, not cowardice. i see this plan as a clarion wake-up call. working families across the country should have the sound alarm at home, bair belair. this is an attack on middle- class families, working class

families. it is an attack on programs that respond to growing jobs. undeniably, the message that we have all heard, from the republicans in alaskan town, jobs, jobs, jobs, professed by all candidates. where is the jobs package? i am not surprised that this reduces jobs because in the last three months of the 112th session, we have seen no jobs legislation by the majority. the team continues. they want to disrupt the steady upward moving forward that has produced 1.8 million jobs since the start of 2010. private sector jobs, absolutely an incredible comeback from the painful, very long and painful recession that drank our economy of 8.2 million jobs.

look at the steady, precipitous decline of american jobs. and then the turning point that comes early in 2009. as we begin to climb upward. why would we want to disrupt, disrupt that steady progress? this is -- i've heard of vood jeff: economics. -- voodoo economics. this makes voodoo economics look pale. ness an attack that reduces jobs at a time that we need to invest in jobs. and we seem to defund with this plan. to be competitive. this dulls our competitiveness. it attacks our middle class. and it does not provide the investments that we need for a stronger economy. now, the economics we see on

this bar graph, the assessment they have done on this plan and whether you buy the 200,000 or 975,000, everyone is suggesting that it's going to drain jobs. this is creating the slippery slope. while we climb the mountain to get to $1.8 million the slippery slope that enables us now with their plan to lose jobs. which is certainly the wrong direction to follow. how do we do that? well, they suggest that we drain $29 billion from education and training. $29 billion. they suggest $276 billion be removed for the sake of transportation over a 10-year period. and then with science, and tech, a $50 billion reduction over 10 years. now, be mindful as we engage in this global race on clean energy and innovation, i agree with the president when he says whoever wins this race emerges

the go-to nation. you will be the exporter of energy, intellect, innovation, and clean energy ideas. why would we want to put that at risk? we have just received the news recently that we have dropped a third in private sector investment for energy transformation after, after china and germany. the america i know and love is number one. and that's what this democratic minority in the house is about. keeping america number one. this is a slash on jobs. it will impact our economy tremendously. because it has been stated so many times by economists, the jobs issue, unemployment, is driving the deficit. if we invest in job creation and job retention, we can very much expect an impact on reducing that deficit. i think the road map here, the ryan road map, is the way to the cliff. and then over the cliff.

it will wreck our economic comeback. it will destroy the hope that we want to provide, should provide for america's working families. it devastates the work force of the future by impacting on education funding and denies r&d, research and development, at a time that's most critical. think of it. we won the global race on spas because we commetted with passionate resolve to make a difference and we landed that person first on the moon. simply because we committed our resources, our energy, and our passions to making it happen. look at what we're doing here. we're challenged to enter a global race on clean energy and innovation and our response from the ryan road map, from the republican majority in the house, defund. disinvest. don't worry about the r&d. don't worry about making it in america. invest in manufacturing, no such way. this is a dreadful outcome. it required courage. we got cowardice. as we go forward we need to fix this plan.

a clarion wake-up call for america and her workers. let's denounce this plan from the republican majority. >> thank you, paul. next we're going to hear from karen bass who i said earlier is one of our new members who comes to us from state politics in california and knows very clearly the impact of the republican medicaid proposals as well as others. >> thank you. just like the road map to america's future, the republican path to prosperity is a pathway to despair. the republicans are concerned about kicking the can down the road. but they have no problem kicking seniors and children to the curb. the 60-page document that we received today is an ideological statement that ironically captures democratic language and gives lib service to democratic values while covering up a radical agenda that would dramatically alter the quality of life for many working families.

the america they paint with their budget prom is a country we wouldn't recognize. really look -- i really look forward to the details of the republican plan. what we need is a balanced approach that speaker after speaker at the budget committee said we must to address the deficit through a balanced approach. in their proposal, they propose no revenue. they only propose cuts and schemes. giving lip service to democratic values and language, i want to give a couple of examples. they talk about ending corporate welfare. he thought that was pretty ironic and their couple of examples for how they want to end corporate welfare is to revisit the financial reform regulation. they want to praoistize fannie and fredi. and they want to lift more torms on oil drilling. this is the way you end corporate welfare. they want to protect the safety net by massively cutting medicaid and having vouchers for medicare. it's not enough to say that if you're over 55 you're

protected. thank you. i know that i'm protected now. but the concern is about the future. but yet the republicans would leave future generations without the resources for health care which ultimately on medicaid would result in a 35% cut. over half the users of medicaid are children. seniors use medicaid to pay for expenses that medicare doesn't cover. that's why i said the republicans are willing to kick seniors and children to the curb while expressing concern for keking the can down the road. many governors have already weighed in on this proposal. and are objecting to the way they're talking about reforming medicaid. states should not be left to decide which populations are services to cover. under the guise of having flexibility for the states, if you look at it down the line, it really just resorts -- results in a cut. a significant cut to medicaid. i do have to hand it to my

republican colleagues. because maybe the way they attempt to capture our language and give lip service to our values, i think we should spend some time explaining what those terms mean. corporate welfare, concern about the safety net, is very transparent to think that you can use language to hide a very radical agenda and trick people into believing that the pathway to process tarot is not a pathway to despair. the way that they are talking about medicare and medicaid, forces seniors out of the system and into private insurance. and leaves children and disabled without the safety net. thank you very much. >> thank you, karen. next we're going to hear from one. veteran members of the committee who knows all these issues very well. our colleague, allison schwartz. >> thank you. and i just want to i guess do a little bit of cleanup here. i want to speak specifically to seniors. before i do i want to share my

-- associate myself with my colleagues' comments that budgets are about values and about our priorities. and to me, and i have served on the budget committee for three terms now and my fourth term on the budget committee. and i have seen each year as we deal with the budget and the fact that the budget should be about three things. they are about meeting our obligations, as a nation, it is about being fiscally responsible, and that's particularly important as we have the challenge of the deficit before us. and it's about growing the economy and preparing for the future. and this budget fails all three. i'm going to speak specifically about the fact that this budget really puts seniors, american seniors, at great risk. they have as you may remember, that the republicans railed against the health reform law, that's now the law of the land. and yet they scared seniors into believing that they -- there would be cuts to their

benefits. there were no cuts to their benefits and there were enhancements to their benefits and ail speak to that in a moment. but this is a budget and what they're planning to do on medicare and medicaid should scare every senior in this country. and every american who someday they hope will be a senior. so within 10 years, we will not recognize medicare or medicaid. seniors will essentially be on their own. to find health insurance in an individual private marketplace that has failed most americans in this country. so this budget, as they have put forward, and seniors know this, understand that they are praoistizing medicare. 69% of seniors oppose privatization. the republicans are not listening. seniors know that dismantling medicare and replacing it with a voucher program means that they no longer will have access to a guaranteed set of health benefits. there will be no guaranteed health benefits under medicare.

they know that the value of a limited voucher, one that's capped, will not enable them to meet the rising costs of health care. they will know that they will have to pay more out-of-pocket and more in premiums. unfortunately, the republicans are proud of this. and they are telling their seniors that they are -- they will be on their own to deal with the insurance industry. that they will be on their own to deal with limits on benefits. they will be on their own on uncertainty of an illness occurs or if they need long-term care. that they may well be -- there may be seclusions for certain kinds of care. specialists or primary care or settings when you can get care. that there could be discrimination based on income and levels of illness and age. and i want to throw in medicaid. which is going to be block granted to states. understand that 62% of medicaid expenses are for long-term care for seniors. so we want to talk about women and children.

i'm happy to do that. but for seniors, this is devastating. any american who has a loved one in a nursing home could well have to pay that out-of-pocket in the future. because medicaid won't be there for them. and have to bring them home to care for them. so this is -- this same time that they're doing this for seniors, the -- there's no question that they are protecting -- you've heard some of this already -- they are spending the same amount of money if not more to protect tax cuts for the wealthiest 2% of americans. that's $700 billion. they're protecting tax cuts for the oil industry. and they're continuing about guaranteeing not to deal with the issues of inefficiencies in the pentagon. there are all of us, and this was said before, all of us on the committee, republicans and democrats, believe very, very strongly that we have to deal with this deficit. and we should. but the way we do it matters. do we do it on the backs of seniors?

or do we do it in a way that shares it across the spectrum and tackling not only spending cuts but tax expenditures and costs in other arenas? and that is -- that is really the debate we're having here. and again, republicans chose last session to ignore the cost savings and strengthening of medicare for our seniors. they sit back and in fact demonize the plan voting time and i'm again to end -- to stop improvements of mccrery for our seniors. -- of medicare for power seniors. and repeal the law that limits co-pamentse for preventative services for seniors and makes prescription drugs more affordable for our seniors and improves coordination of care and reduces errors and improves patient car and outcomes for power seniors. they want to repeal the law that curbs the growth and -- of medicare spending. and extends the fiscal life of medicare trust fund by 12 years. and it saves taxpayers $400

billion by ending overpayments to insurance companies. that's what they want to stop. instead, republicans here in washington want to end medicare as we know it for seniors. and again, i will end with where i started. if seniors were scared last year falsely by the republicans, this year, the republicans are right to say to american seniors that you have every right to be scared. because you will be on your own. you're going to get a voucher that's limited. that won't grow. and you're going to have to negotiate with the insurance companies on your own. you tell that to my 91-year-old father who's right now in -- trying to get off a vent lator. how is he going to negotiate when his medicare benefits are up? to be able to find the private health insurance that he needs? he simply won't be able to do it. it's going to fall on all of us. ness a decision we have to make. this is a question of our priorities. are we willing to say we are going to balance the budget and actually our ranking member

said it doesn't even do a very good job of that. are we going to take money away from seniors? and wheel we end medicare as we know it and medicaid as we know it and protect the wealthiest 2% of americans and corporate america? that's our decision. instead, we ought to get serious and meet our obligations to our seniors and our children and to our future and we can do that. and we should. we're not going to do it with the reinbudget. thank you. -- with the ryan budget. thank you. >> thank you, allison. happy to answer any questions you have. >> in the reinbudget, is there anything you can work with or do you have your on plan that you guys are putting forward or let's raise taxes on the top 2%? >> two things. obviously we've seen the major pieces of the republican budget here in the house. we haven't had a chance to dig down so far it's very hard to find something that meets the

objectives that we've talked about. which is having a balanced approach to a deficit reduction. yes, the democratic caucus will have an alternative. and the alternative will reduce the deficits in a serious and predictable and steady way. and it will demonstrate a very different approach going forward. yeah. >> mr. van holen, the ryan budget is already being cast as the platform for republicans' economic argument in 2012 including for their eventual nominee against president obama. can you speak to the political significance of this document and how you think it can play next year? >> it's going to be up to every republican candidate for president to decide whether they want to run with this particular republican plan or not. i would just suggest that they're going to want to take a very careful look at it. because in addition to slashing very important investments that are necessary for our economic

growth, and the strength of the country, it also essentially undercuts entirely the bargain that we've made with seniors as we've discussed. and what it does is as that we're going to end the medicare guarantee, throw seniors over to the winds of the private insurance market, and we've already seen rates rising in the private insurance market and you the senior are going to bear the entire risk of that added cost. so it's a budget that as we said has just totally skewed a misplaced priority that benefits the very wealthy and powerful special interests at the expense of important investments. and at the expense of seniors. >> if i could just walk back a moment. you said earlier in your comments that to govern is to choose. and republicans have said repeatedly that democrats didn't pass a budget when you

were governing. and the reason they have to do all this cutting spending is because you put them there in the first place. >> well, two things. first of all, when you talk about the fiscal year 2011 budget, which is the debate going on right now over a very small portion of the budget, the fact is that the democrats did pass last year a budget enforcement resolution that set out the targets very clearly as to what should govern this year. in fact, when you hear the debate, that republicans are making about how we have to make changes to that, that's because there was the other alternative out there. today, what we're talking about is really where the discussion should move to, which is taking a look at the federal budget as a whole. and part of the issue with the debate going on about 2011 is republicans only want to talk

about specific cuts to a particular part of the budget. they don't want to talk about cuts that would involve taking the subsidies away from the oil industry. they don't want to take away loopholes in the tax code that benefit corporations and result in having many major corporations pay absolutely no income tax to share in making sure that the country is strong. so look, that is the -- that's going to be the debate going forward. we're talking about both fiscal year 2011 and 2012. >> so that's an old argument then? >> i'm sorry? >> that's an old argument? >> a totally old argument and ignores the fact that we did have the one-year blueprint there, yeah. >> can you give us a time line on when you plan to unveil your own budget alternative? will it be ready for next week when the committee looks to mark up mr. ryan's plan? >> we're marking up the republican plan tomorrow. certainly the democratic alternative will be ready for

floor debate a week from tomorrow. yeah. >> on medicare, chairman ryan is saying his plan is not necessarily a voucher program because the government would be negotiating with insurers and seniors have the option comparing it to the plans that members of congress have. but it sounds like you aren't seeing it that way. >> not at all. and whether you want to call it a voucher or whether he wants to call it a premium support program, it all comes down to the same thing the way he has it designed. which says that number one, seniors no longer will have the option of being in the medicare program that they're in today, the fee for service medicare program. they will be required to go into the private insurance market, number one. number two, the value of the voucher or premium support, whatever you want to call it, does not rise at the rate of health care inflation. and what the republican budget does is says to seniors, you're on your own.

you got to pick up the entire cost of that instead of the approach we've taken which is in order to reduce costs in the health care stem touch treat the whole health care system and get rid of the inefficiencies where so many americans were getting their primary health care at the hospitals, driving up costs for that. which is why dr. rivlin has said number one, make sure you don't dismantle that because it does help bend the medicare cost curve. but in short, what they do as i said is shift the entire risk to higher -- to seniors just a word on the federal employee health benefit plan. and the other analogies. under that plan, the employees get a fixed share of the cost. in other words, the employer, in that case the federal government, shares the risks of rising health care costs. under the republican plan, that's not the case.

the burden of the rising costs is on the senior. you're on your own. >> and some of this, the details obviously have yet to be worked out. and when you hear whether a voucher or premium support, that suggests that there will be a gap, right? and also, they also want to make it means tested. so where that break is could matter a lot. if you're saying ok, etc. seniors above $20,000 income. and are we only going to give -- going to get less and less support from the federal government at the higher you go above $20,000 income. that's a low threshold. we've heard some of those numbers. so it could well leave literally tens of thousands and millions of seniors at great risk for bearing the greater burden of both out-of-pocket costs and premium support. or buying insurance that really does not cover their health care needs. and that -- a group like this, all seniors, i always joke, my senior groups and say any of you on medication? and they all laugh. and any of you on two

medications, three medications? and even healthy seniors actually are pretty costly to take care of. we've discovered that in government. that's why we've instituted a whole variety of innovations to improve quality and improve outcome. but we're doing that by asking the payers and the providers, hospitals and doctors, nursing homes, to do a better job, spend less money, make sure that people are getting the health care they need. not putting it on the backs of seniors. thank you. >> and it also will mean that you don't get to pick your doctor unless the doctor happens to be on the plan that you can afford. it rations health care this time by the income of the senior. because you're only going to be able to purchase what benefits are offered. for that price. you don't get your doctor, you don't get those benefits. >> we can take one more or two more and then we got to go.

one and two. ok. >> the white house didn't address, the proposal, and are you going to do that or fall back on health care reform bill as your statement on it? >> let me say something. the republican bill, i want to make this very clear. i want to make this very clear. in the next 10 years, the revenue they get from so-called medicare reform is the -- are the savings that were generated as a result of the passage of the affordable care act. i want to be very clear about that. they demagogued those medicare reforms. they said we were just slashing medicare when enact we were removing the subsidies for medicare advantage plans, the overpayments. they were getting reimbursed with taxpayer dollars at 114% of fee for service. that is the primary sort of -- they've taken those savings, the same ones that they criticized, in their plan.

so -- do we end the medicare guarantee for seniors? absolutely not. we got one more. >> one of the things mr. ryan said in his presser was he was hoping that maybe on the social security portion of this bill that we can come to an agreement with the democrats. do you see anything like that with the social security language you've seen? >> well, we haven't seen exactly what they do with respect to social security. we'll have an opportunity to do that. our view is that you should not balance the budgets on the back of social security. that social security can pay 100% of the benefits up to the year 2037. after that, if you do nothing at all, those benefits will drop. so i believe that we should, apart from this particular budget negotiations, and the deficit reduction, apart from that, we should get together on a bipartisan basis like tip o'neill did and with ronald reagan, and try and address

that issue. but again, we shouldn't be balancing budgets or reducing deficits by cutting social security. >> will you vote on the short-term -- will you vote if it pops up? you won't shut the government down? >> have to tie a look at it. -- to take a look at it. >> now let the house republican federal budget blueprint for 2012. the measure is set for debate in the house, possibly this week. according to the associated press, the plan seeks $5 trillion in deficit reduction over the next 10 years. there are also significant changes to medicare and medicaid as well as an overhaul in the tax code. >> we will now proceed with consideration of the fiscal

year 2012 concurrent budget. the ranking member and i have developed an agreement for today's market based on the framework we have used in the budget committee in the past for both parties. we will begin with opening statements. staff will describe the chairman's mark, and we will proceed with consideration of timelimination's in periods of three tiers as we have done in the past year and one hour will be controlled by the majority and one hour controlled by the minority. i will make an opening statement, and then ranking member mr. van hollen will make a statement. before i begin my opening statement, i would like to yield to the ranking member for questions or observations that he may have. >> no, mr. chairman. we look forward to a vigorous but respectful debate over differences.

>> welcome to the market for the fiscal year 2012 budget resolution. i'm proud to be here with my house budget committee colleagues. these are men and women who work hard to put this budget together to try to get our country back on track. i'm proud of all the hard work you have done and the work we are here to discuss, and i also want to say on behalf of both parties, our staffs, the minority side and majority side have done a fantastic job working around-the-clock, or hours, and also the cbo as well, and i think hast should be taken off to our staffs and the cbo. i also want to thank mr. van hollen in your cooperation to this year's market. nt to mutual respect in keeping with t best traditions of this committee. your predecessor did so as well, as did his. i'm proud we are continuing this kind of tradition.

call this budget the path to prosperity. because it is morehan just a budget. this is a cause. it is a cause to get america's future on a good path. it is our commitment to the american people. the facts are basically these. for too long, washington has not been honest with the american people. we've been making empty promises from a government that is going broke. the nation's fiscal trajectory is simply not sustainable. the debt is projected to grow to dangerous levels in the near future. for all the talk you willhear today about how people will be supposedly hurt, nothing will hurt the american people more than staying with the status quo, than going down the path of accelerating us toward a debt crisis where its indiscriminate cuts where everybody gets hurt. we want to preempt that crisis. we want to preempt painful austerity. we want to fix these programs and get spending under control

and we want prosperity returning to this country. let me gohrough some quick powerpoints. that is driving our budget? take a look at these charts. our entitlement programs are the drivers of our budget. this is the primary drivers of our budget. failure to address the big drivers of ourdebt, particularly the health care entitlement programs is not to address our debt. next chart, please. the more we kick the can down the road, the wse it gets. the fiscal gap shoulde the next chart. look at this chart. the general accountability office has been telling us for years we are making all of these unfunded promises to americans and the more we kick the can down the rod, we go about $10 trillion deeper down the hole. we can get this under contro and get it in our terms but time is of the essence. next chart, please.

debt held by the deficit path. this is the other thing. let's go to the last one. i see we're bouncing around. go to the who shares the debt. the past, we've lenlts money to ourselves. rld war ii, our debt went up as high as the entire size of the economy, but most americans bought war bonds. 1970, a small fraction of the debt was owned by foreigners. 1990, a still 19% of the debt was owned by foreigners. today, 47% of our national debt is owned by foreigners. foreign governments, particularly china. next chart. that is unsustainable. you cannot rely on our countries to cash flow your government. let's go to deficit path. this is the deficit path we are proposing. this is not what we want but this is far better than where we're going, with the blue line cbo or where the president is taking us. the deficit path is disastrous

under the president's plan. this is what the economists are telling us matters the most. we he had testimony after testimony about getting your debt under control. it's just like the same principle of your mortgage. you take on your mortgage relative to your income you can support. same goes for us. the debt held by the public as a percentage of gdp goes down under this budget not just in the first ten years but paid off overall. the debt paid down by the president gets us to the catastrophic area of 90% of gdp. next chart, please. outlays. spending still increases. for all the talk and the rece t rhetoric we hear today, it still increases. that's a $5.8 trillion cut. we can't keep spending money we don't have.

the problem in washington is not that the american people are taxed too little. the problem here in washington is that we're spending mone we don't have. we have to address the problem and spending is the problem. next chart. >> revenues still go up. we still, even though we make the tax cuts permanent. even though we do fundamental tax reform, revenues still increase under these baselines. next chart, please. this is the trajectory. look at where we are headed. federal spending. this is the size of government, by the time my three children who are six, seven and nine by the time they are my page will be double where it is today. this budget keeps our historic size of government where it has been so we can maximize the economy and economic freedom. next chart, please. deficits. now, we all know that deficits is a share of the economy really matters greatly. it's whether or not you're getting the debt in the right direction or wrong direction. that's the status quo that the

president's budget puts us on. it gives us catastrophic deficit spending which accelerates us to a debt crisis. we are getting it under control and gting it paid off. it's about growth. we asked an independent analysis, which uses the global insight model, a model used by ma firms all around the country. what does this do? because it's all about path to prosperity. what this model shows u is the economic effects of getting your spending under control, pro growth tax reform, pretempting the debt crisis means more jobs. it's proked this will create one million new jobs next year alone. 2.5 million jobs in the next year. higher wages to the tune of $1.1 trillion, more economic growth to the tune of $1.5 trillion, higher family incomes. this analysis projects that this budget means an additional thousand dollars in family

income for families every single year. these are just different separate analysis, but the whole point is what we're trying to achieve is give our children and grand children a debt-free nation. bring solvency and sustainability to these vital programs and getting prosperity, job creation. getting this economy growing again. next chart, please. this is what it's all about. we are on a path ofcomic ruin. don't ask me. ask erskine bowles, anybody who looked as this situation. this red line is the cbo's projection of what our debt will be. we have a choice of two futures in this country. do we want to sever that american legacy that literally gives our chilen and grand children a lower standard of living, less opportunity, fewer chances of upward mobility for people in america? or do we want to get the debt

paid off? the green line shows you what the path to prosperity does. this is cbo's forecast of how we get the debt under control and paid off. we can still do this under our terms. i urge my colleagues, let's get through this partisanship and get on to the business of saving this country and getting this debt paid off while we can still do it on our terms. the reforms in this plan are gradual. they are sensible. we borrowed ideas from the fiscal commission. we asked general accountability office. we took ideas from democrats of the past to try to come up with a plan to save america from a debt crisis. the cbo's purity crashes in the year 2037 because they can't conceive of a way in which the american economy can continue after that. that's unconscionable. the biggest crisis or most unples apts experience i ha in congress was the 2008 crisis. we were all there. we participated in negotiations. we saw millions of people lose

their jobs. we saw trillions of weight lost. that caught us by surprise. this is the most predictable economic crisis we have had ever had in this country. this is something we can pretempt. this is something we can stop. we owe it to ourselves. we owe it to our children and grandchildren and our fell countrymen to get this debt under control and with that, i yield. >> thank you, mr. chairman. let me start by thanking you and all of our staffs for their hard work. we gather to consider a long-term budget plan at an especially consequential moment for our country. as a result of the extraordinary actions that were taken over the last few years, america avoided a second great depression and is slowly emerging from the ravages of a financial meltdown and near economic collapse. while the economy is improving, millions of americans remain out of work through no fault of their own, and thousands more

are facing home foreclosures as a result of their job loss. our top priority must be a robust recovery and putting america back to work. at the same time, we must act now to lay the foundation for sustained long-term economic growth. even before the economic meltdown, real wages for most americans had been frozen for too long while families faced rising costs. ddle class familiehave been squeezed. we must implement a plan to support small businesses, grow the economy and ensure shared prosperity. that will require making strategic national investments to outeducate, outinnovate and outcompete the rest of the world. it will also require deloping and implementing a discipline plan to steadily and predictably reduce our deficits and debt so weestablish a strong foundation for long-term growth.

mr. chairman, we all love america. we all believe america is a unique and special place and believe in american exceptionalism. the question is how do we keep america strong, dynamic and exceptional? on that, we clearly have different views and would make different choices. we believe our strength springs not only from the undisputed benefits of a free people pursuing their ambitions and dreams but also from sometime harnessing those talents for important national purpose. we believe that america's greatness has resulted not only from a collection of indivials acting alone but from our capacity to work together for the common good. we do not see the government as the enemy but as the imperfect instrument by which we can accomplish together as a people what no individual or corporation can do alone. we all agree that we must act now to put in place a plan to

reduce our deficits in a steady, responsible and predictable manner. the question is how do we do that. as the bipartisan fiscal commission has indicated, any responsible effort to reduce the deficit requires a balanced apprch that addresses both spending and revenue. this republican plan fails that simple test. yesterdaye ers kikine bowles sa that the budget falls short of the approach needed to achieve bipartisan agreement necessary to enact a responsible plan. unquote. indeed, the republican budget is the same tired formula of extending tax breaks to the rich and powerful at the expense of the rest of america. except this time on steroids and dressed up with what we'll hear is a lot of nice sweet talk

about reform that masks the damage that this budget will do. to govern is to choose. and thechoices made in the republican budget are wron for america. it is not courageous to protect tax give aways to big oil companies and other special interests while slashing investments inur kids' education, in scientific research and critical infrastructure. it is not bold to provide tax breaks to millionaires while ending the medicare guarantee for seniors and sticking seniors with the bill for rising health care costs. it is not visionary to reward corporations that ship american jobs overseas while terminating affordable health care for tens of millions of americans. it is not brave to give governors a blank check for their pet initiatives the and a license to cut support for seniors in nursing homes, individuals with disabilities

and low income kids. and it is not fair to raise taxes on mile income americans to pay for big additional tax breaks for the very wealthy. yet those are the choices made in the republican budget. where is the shared sacrifice? we have american men and women putting their lives on the line in iraq and afghanistan while others hide their income in the cayman islands and switzerland and refuse to pay their fair share to support our nation. the bipartisan fiscal commission called upon all aricans to pay their fair share. its budget blueprint calls for the top 2% income earners to pay the same tax rates they paid during the booming economy of the clinton administration. their plan also generates another $1 trillion in revenue over ten years by closing special interest tax loopholes and limiting tax expenditures.

the fiscal commission also warned that very deep immediate cut cu would threaten the fragile economic recovery and slow job growth. they recognize that americans make strategic investments to win in the global marketplace. the republican budget fails both these tasks. i would say that the jobs numbers we heard cited comes from that done by the heritage foundation, the sail organization that predicted that the bush tax cuts of 2001/2003 would lead to booming job growth where we know at the end of that eight-year period we had lost private sector jobs in america. make no mistake significant and sustained spending cuts must be part of any balanced plan to reduce the deficit, but american has become an economic powerhouse in part because of the targeted strategic investments made by earlier generations including huge investments in science and technology, the interstate

highway system and educational opportunities for our people. now at the very moment tt our global competitors are copying our successful model, this budget would take america back. now let me turn to the question of health care. every member of this committee knows that rising health care costs represent a huge challenge for the federal budget. but every member of this committee also knows what the experts have told us, that those rising costs are not unique to medicare and medicaid. those costs are endemic to the entire health care system. in fact, for 30 years the per beneficiary spending in medicare and medicaid has grown at virtually the same rate as those of the overall health care system and over the last decade the per beneficiary costs of medicaid actually grew more slowly than the rest of the health care system. by contrast, in the private market for individual coverage,

premiums more than doubled between the years 2000 and 2008. those facts make one thing clear. if we're going to slow the rising costsn the medicare and medicaid without rationing care, we must slow the rising costs of alth care throughout the health care system. that is exactly what the afrdable care act was designed to do and will do when fully implemented. the affordable care act will begin to bring down the per capita health care costs throughout the system including mecare. it includes virtually every cost containment provision recommended by health care experts. we heard that before many of our witnesses before this committee. yet this budget, this budget would kill many of those system-wide reforms that would reduce costs in the system. now, interestingly, this republican budget does preserve many of the specific medicare reforms in the affordable care act. including some of the mechanisms to slow the growth of systems

and eliminate excessive taxpayer subsidies to some of the managed care companies. in fact, the bulk of the medicare savings in this ten-year budget comes from reasonable reforms we made in the affordable care act, which is especially startling given the fact that during the last campaign democratic candidates faced a barrage of campaign attacks telling seniors we had slashed their medicare. what is new, what is new in the republican budget plan is the termination of the medicare guarantee for seniors. it doesn reform medicare. it deforms and dismantles it. it forces seniors off of m medicare a into the private insurance market. it does not to rein in the st of health care but transfers the bill for those rising costs to seniors. seniors will pay more while insurance companies stand to reap a bonanza by getting all the medicare payroll taxes and the premiums people currently

pay. if your support amount, your voucher, premium support, whatever you want to call it is not sufficient to pay for the benefits you need? tough luck. if your doctor is not on the private plan? too bad. this plan simply rations halth care and choiceof doctor by income at the end of the day. it also rips apart the safety net for seniors in nursing homes and assisted living facilities as well as low income kids and individuals with disabilities who rely onmedicare. there is nothing courageous about targeting the most vulnerable in our society. yet this is the biggest area of cuts in this budget. block granting medicaid is code for deep cuts and support to our vulnerable seniors, individuals with disabilies and low income kids. and giving governors so-called flexibility is a nice-sounding way of giving them a license to use federal taxpayer dollars to

pay for their favorite initiatives without oversight and accountability. that's not reform. medicaid is already underfunded. block granting it is like throwing a drowning person an anchor. and the claim that dismantling medicare guarantee and block granting medicaid is necessary to is a save them is in my ew simply orwellian. it reminds me of the statement that was made at one point that you have to destroy the village in order to save it. democrats welcome an open debate about how we can build upon the reforms in the affordable care act to strengthen and sustain medicare and medicaid. but we'll vigorously oppose any effort to undermine the integrity of these to seniors and vulnerable individuals. mr. chairman, we believe that the republican budget is the wrong choice for america because it does not reflect what we believe are our values and priorities.

it does not reflect the best of the american experience. it recognizes the importance of individual self-reliance that is an very important part of the american character, but it fails to recognize the truth emblazoned on the great seal of the unite, that out of many, we unite as one behind shared values and principles to advance the common good and make america strong and exceptional. and we will be offering next week a democratic alternative -- >> good. >> -- so that people can see the choice before the country. >> i'll put the gentleman down as a no then? i'm glad you're doing the -- that's good. the majority will go, then the minority. i'd like to allot five minutes to mr. garrity.

>> in that vein, the president created something call and he did that t address the nation's finances and charged that commission with identifying policies to improve the fiscal situation. fittingly that report has been called the molt of truth. but what did our president do during that moment of truth? he failed to lead. rather than rise to the occasion and make good on the faith that the american people placed in him, the president submitted the most expensive budget in the history of america. the president's failure to lead is absolutely astounding. so i agree with chairman ryan when he says that basically the president has punted on his responsibility. but the disappointment is further than just republicans here today. the co-cham of his own debt commission summed up the president's plan as going, quote, nowhere near where they will have to go to resolve our fiscal nightmare. in my opinion rather than going nowhere near a solution t administration has submitted a budget that basically forces us close tore the crisis point.

accordingly to the nonpartisan cbo, the president has proposed a $3.7 trillion in spending this year. this is over a qrter of the gdp. a level that we have not seen in the united states since world war ii. and the president would have us sustain that level for over a decade. so bad enough if that were all, it gets much worse. this year the budget deficit is estimated to be around 1.6 trillion. over ten years the president's budget deficits will total 9.5 trillion. setting the national debt on a course to skyrocket to unprecedented levels. according to the cbo, the debt level held by the public would rise from 69% of gdp in 2011 to 87% of gdp in 2021. with the already staggering level of debt are consuming a larger and larger percentage of tax revenues that flow into the government coffers. cbo recently estimated that the american people will, getthis,

pay $260 billion in interest alone on the national debt. we can be paying almost a trillion dollars in interest by 2021. when you have a hole, what do they always say, stop digging. it's crystal clear that this country has a spending problem, as the chairman said, despite evidence to the contrary, this budget, that the president proposes is not the direction t go in as opposed to the one submitted mr. ryan. rather, in cutting spending the prident proposes to take even more of the hard earned money of the american people. over ten years the president's plan would increase taxes on families and small businesses by $1.6 illion. all this is even more daunting arithmetic when you think about it. these numbers have a real effect on the lives of individuals, on families, on businesses. so should the president's proposal be enacted, it would doom american milies to doing what? a crushing tax rden, smother the ability of small businesses to create new jobs, result in

ever-increasing interest rates. and set the nation on course for an economic day of recning. in short, the president's refusal to lead in this situation threatens the american standard of living, the american dream and american status as a superpower. now, i have so far focused on whathe president's plan will do. but what is equall disturbing in this is what the president's budget does not do. the president's plans contains no significant reforms of social security, medicare, or medicaid. annual spending on social security, medicare, medicaid is expected to rise all the way up to 2.7 trillion over the next decade and cbo again projects that maintaining all promised ending would eventually require what? putting the middle class in a 63% income tax bracket. get that. and small businesses andpper class families in an 88% bracket to pay for all that. again, rather than cut spending back by the government, the president woulsend an overwhelming tax bill to the

american people. mr. chairman, everywhere you look, we are on the road in this country to bankruptcy. and the president's budget makes promises that they cannot possibly keep. to be specific, our government has made $88.6 trillion in promises it cannot be kept through entitlement programs. cutting spendg and government programs, they're not easy. but the american people did not elect us to take the easy way out. however, in this moment of truth, the president did exactly that. so i look forward to working with the members of this committee to provide an honest solution for the american people by cutting spending, balancing the budget and putting the united states on the road to sustainability and also prosperity. with that i yield back. >> ank you. i now yield five minutes to the gentleman from georgia, mr. price. >> thank you, mr. chairman. i want to comment you and all of my colleagues for the great work that has been done on this budget. i am somewhat amused in listening to my friend the

ranking member in his opening comments a in the comments that have come across the press since the introduction of this piece of legislation. my friend says to govern is to choose, and he's right. and last year, as the committee and the nation will know, the choice by our friends on the other side of the aisle was to do no budget at all. no budget at all. it is amusing to hear the admonitions from the other side. i think they might have taken back to the m.o. that they had in many pieces of legislation during the last ur years and that is not even reading the bill. because if you read the bill, it's inconsistent with the charges that have been leveled this morning and yesterday. i'm reminded of president reagan, to paraphrase him about our friends on the other side of the aisle, it's not that they're wrong or that they're ignorant, it's jt that so much of what they know just isn't so.

and it really is -- my ears just -- it's hard to comprehend what's being said on the other side. what we have truly is a choice. a choice of two futures as the chairman identified. and this graph i startling. the red here, the debt as a percent of gdp goes to 900% of gdp. that's the president's plan. that's your party's plan. that's unsustainable. the american people know that. the solution is the path to prosperity, which is the green at the bottom which gets us to balance and onthat path to balance over a period of time. mr. chairman, the american people really are si and tired of washington's accounting tricks and budget gimmicks that you mentioned and the empty promises. during the course of today's markup, we will hear more demagoguery and hyperbole from the other side, false claims from the other side.

but i believe that it's exactly that brand of politics which has prevented us from addressing the american people in an honest and a factual manner. our budget, our path to prosperity is a bold vision for the future based upon facts. it puts the united states on a path to prosperity by cutting in its first year 600 billion. cutting $600 billion off the ficit. there are no more trillion doar deficits which the other side has become enamored with. no more trillion dollar deficits. house republicans will save more than $6.2 trillion when compared to the president's budget over the next decade. we begin by completely repealing and defunding obama care. completely repealing and defunding obama care. as a physician, i can tell that you it is a threat to the affordability and access ibltd and equality of health care. all of the principles that we hold dear in american health care and medicine are violated

by obama care. the facts are that it takes away choices from patient, families, physicians andsaddles workers and taxpayers with trillions of dollars in costs. further, we will save, we will save and preserve medicare for future generations by providing a commonsense solution so that folks will have access to the same kind of health coverage choice that, yes, members of congress do. you heard it talked about on the campaign trail. you heard the president himself say what we need to do is just bring people the same kind of insurance that members of congress does. that's what our prosal does, allows indiduals to have that same kind of coverage. it's imperative for people to recognize, mr. chairman, that nothing, no changes occur for those in and near retirement. they again would get all sort of mem ma going tory and hyperbole from the other side. no changes for those 55 and above. now, many folks, especially on the other side of the aisle, would rather bury their heads in the sand and ignore the reforms

necessary for medicare. i talked to a lady the other day in my district. a newly egible medicare patient who canno find a medicare physician. cannot find a medicare physician. the program is broken and is unsustainable. the status quo is unacceptable. what we do is honestly and factually reform the program. medicare program. it is a guaranteed issue to seniors of this country through our program. so by completely repealing and defunding bm become cobama bm c simultaneously move from an era of debt, doubt and depair into a stable and secure future. mr. chairman, i'm honored to support this path to prosperity. >> thank you. now i'll yield two minutes to the gentleman from wisconsin. >> thank you, mr. chairman. i support this budget resution today and thank the chairman and members of the committee and the committee staff for all their hard work.

one simple reason i'm advocating for this budget is we've got to stop spending money we don't have. it's a simple concept, if you only have $6, you can't spend 10. but that's what we do every day. every day where 40 cents of each dollar spent by our government is borrowed. it has to stop. not 20 years from now. it's got to stop with us. this committee must lead. chairman ryan, i thank you for your leadership on this. as many of my cleanings have eloquently explained the myriad of ways this budget gets us back on the path to prosperity, already many of my colleagues on the other side of the aisle have begun to do what washington always does. for political gain today, they jeopardize tomorrow by distorting what is in this budget while denying the realities of our fiscal situation, which are many too serious for demagoguery. cutting spending promotes economic growth and job creation. so does tax reform. as aormer small business owner, i fully understand how important it is for congress to

untangle job creators from the maze of tax loopholes that hurt our economic growth and shrink our tax base. for many of the principles contained in the president's fiscal commission, this budget takes on tax reform. corporate tax rates are the highest in the industrial world. if we're really going to make it in america, we've got to incentivize corporations to stay in america. rather than pushing their businesses elsewhere where it's cheaper. by lowering tax rates, bringing the top rate down from 35% to 25%, we'll promote economic growth and job creation exactly what americans need today. and by implementing corporate tax reform, we'll improve incentives for job creators to work, invest and innovate right here in the united states. thank you for this opportunity to work, debate and vote on this budget. and i yield back. >> thank you, mr. ribble. at this time five minutes to the gentleman from missouri. mr. aiken. >> thank you, i'll address myself to the section of the budget particularly dealing with

the armed services committee. as many of you may remember, it wasn't so many weeks ago that we all stood up and put our hand up and we took an oath of office to, among other things, to stand by the u.s. constitution. now you don't have to be a great reader or a great scholar to get very far into the constitution, that is to the preamble to understand what our mission is and what our priorities should be first and foremost. and that is to provide for the common defee. common sense would suggest to us that if we are being attacked by foreign countries or bombed or whatever, our interests are being destroyed, then our life, liberty and pursuit of happiness isn't so valuable if we do not have a decent nation security. and so that is a top priority. in that regard, this budget is quite austere. we are taking the $178 billion in savings identified by

secretary gates, 100 billion that can be revested in wiser spending and returning 78 billion to retire some of our debts and deficits. i say this is a very austere budget. i want to try to put that in perspective. i am an old army guy, but i had three sons that went the wrong way. they went to the naval academy, then chose the marine corps. i don't know what i'm going to do with them. but nonetheless, at least they do take seriously their responsibility as young people to stand up for our country. if you take a look at where we are right now in just very macro kinds of numbers and you don't have to be much of an expert. just think of it in the terms of the number of troops or soldiers, the number of aircraft and the number of ships that we have. and each of those categories, we're roughly now at 50% of

where we were 20 years ago. our navy today is the same size as our navy in 1916. so our military would not be what you would call fat by standards of certainly 20 years ago or half weight. that being understood, i would have problems with this budget if it weren't for the fact that we're dealing with an economic reality which is most austere and stern. and it requires all of us to take a very solid look at our spending and deal with the fact that we are vastly overspending the revenues that we can assume we can generate from within our own country. and along those lines, i think that given the overall balance of what we have to do, that this budget is probably the best compromise that we could come up with. now, i have heard comments from the minority member, minority

leader here that they're about what's responsible, what's courageous, and my sense of the america th i know coming from the state of missouri is an america that has a can do and a positive attitude. we're an america that says, yeah, we've had some problems before. looking back on our history. we've had some whopper big problems. but americans have had this responsibility that we're going to hike our britches up, tighten our belt and we'll go forward and we're going to talk about things, we're going to come up with the best solution and move forward. and somehow or other, i don't feel it's up to the standards of what america's all about, of our history or what the great constituents that we represent say when we just simply sling rocks at somebody else that has an idea. i would respect the criticisms much more if when the democrats we in power last year that they had abudget, but they didn't have a budget. instead, we have brought this budget forward seriously trying

to find a good balance even though places like defense are pretty tight. and what we're hearing is a lot of criticism. but i think i like whate do better than what the democrats don't do. thank you, mr. chairman. at this time i'll yieldive minutes to mr. mcclintock. >> thank you, mr. chairman. history walks with us as we begin our work today. fortunately it offers some guidance as well. history offers not a single exampleof a nation that is ever spent and borrowed and taxed its way to prosperity, but it offers us many, many examples of nations that have spent and borrowed and taxed their way to economic ruin and bankruptcy. and history is scrming this warning at us that the nations that bankrupt themselves aren't around very long because bere you n provide for the common defense and promote the general welfare, you have to be able to

pay for it. and the ability of our nation to do so is now in grave danger. throughout these hearings, the economists from every part of the political spectrum have warned us that we have at best just a few precious years left to avoid a sovereign debt crisis and potentially the financial collapse of the united states government. fortunately history also offers us lessons of what to do and what not to do. we not what not to do. herbert hoover responded to the recession of 1929 by increasing federal spending by a staggering 60% in just four years. he began by imposing the smoot hollyariff tax which was a steep tax on 40,0 imported products and boosted the federal income from 23 to 65%. franklin roosevelt simply amplified and expanded these policies. and in 1939 the unemployment

rateas just as high as when he started. we had lost an entire decade. in 1945 harry truman abolished the tax. he slashed taxes, in 1946 truman cut the federal budget down to $30 billion in a single year. he fired 10 million federal employees. it was called war demobilization. the keynesians at the time predicted 25% unemployment and renewed oppression. except these policies fueled the post war economic boom. we have more recent examples. i reach out to my friends on the other side of the aisle to join them in their praise of bill clinton, but we have to look at the policies that produced the prosperity. during his administration, bill clinton reduced federal spending by a miraculous 3% of gdp. he dared to touch the third rail of entitlement spending, and he