25% above that. that is my own personal bill. the point i'm trying to make is that by broadening the tax base, you are taken away tax deductions uniquely enjoyed and disproportionately enjoyed by higher income earners. and here is something we should not miss. more than half of the income coming to the individual tax code is small businesses. limited liability partnership, meaning that most of the jobs in america do not come from corporations but from small businesses, successful small businesses. and most of them pay their taxes as individuals. thehe president's lot takes top tax rate to 44.8%. we're talking about taxing small businesses at a 44%? that is ridiculous.

they will kill jobs and growth. we want to bring that down to a normal rate. >> my concern about this budget and priorities about bridging and about h.r. 1 and the subsequent compromise and i think that this budget would be the frosting on the cake, the largest redistribution of wealth from the middle class and the poor to the wealthy in american history. >> we agree -- we disagree with that. >> i yield to the gentleman. >> a quick fact. very quick fact. this is why the bipartisan fiscal commission said that the republican plan was on balance. there's a different -- in the fiscal. -- in the fiscal commission approach, they have $2 trillion more in revenue because this plan cuts medicaid by $700 billion before you even get to

repealing the health care bill and the medicaid in there. the center for budget and policy just said that two-thirds of the cuts come from working families and by honorable individuals. and you recognize the big rest tradition. -- the big redistribution. gm he is going to vote. and they have someone here to represent their views. [inaudible] yes. that first sentence in that statement from erskine bowles and alan simpson is that our plan was simple, straightforward, and honest. let me say it again -- the cochairs said that it was credible, straightforward, and honest. they believe that to get a

political consensus with the democrats controlling the senate and the white house, and i am not saying that they're wrong, if you have to have a mixture of tax increases and spending reductions to get a political balance and a political compromise. this does not meet that test of what they think is necessary for a political compromise. but with respect to a plan, they say it is credible, straightforward, and honest. >> thank you for helping us understand what unbalanced means. to democrats it means it is not going to raise taxes. we cannot just cut spending. mr. goodall, i believe you are next. >> i have the great pleasure of being the rules committee designee to the budget committee and i have enjoyed working with you both in that capacity. let me ask you, you be in a

newer member to the committee as i am, may have a better answer, to describe the medicare changes. every single person i have heard described on that side of the aisle has described it as seniors losing access to medicare. as i understand what you and i passed out of the committee, unless you're one of those folks it considers 54 to be old age, not a single senior as the medicare program changing in any way whatsoever. >> our concern is about the impact involved to the senior community. as we look at it now -- >> then they will be why you do not understand it. is that right? folks age 55 and older are at risk from paying twice tomorrow what they're paying today? >> we believe that because you are pushing them into the private market, we have to knowledge that over the course of medicare double -- --.

>> you're pushing people into the private market. my understanding is not only are we not pushing them into the private market, we are not changing a single thing for them and medicare will continue to exist in perpetuity as everyone understands it today. i am glad to know that what we're hearing -- i am right about this. >> it will not change a thing for anybody 55 and older. they stay in their traditional medicare for the rest of their lives. here is the point. you have to do reforms like this for the younger generation so you can to me -- keep the commitment to the current generation. giving the crisis that is coming, let's get ahead and preempted and to its of the people who have already retired and organize their lives around these programs and people are planning their lives around these programs the had the promise made to them, let's make sure that we can keep that

promise. but you cannot keep that promise unless you fix medicare for the future. we will absorb that in this country to be able to keep that promise, but we can absorb debt at this levels because we're getting rid of -- the rest of the debt down. we believe that the country can afford to keep this commitment to people in neared. -- in near-retirement if we act soon to arrest this incredible increase in our debt. >> will the gentleman from georgia yield a moment? i wondered if mr. bryan, if you have any explanation at all for why our colleagues on the other side of the aisle continue to say the opposite of what you are saying. >> i try not to get into people's motives. i do not know.

>> reclaiming my time, you and mr. van hollen said and not of nice things about each other about how much you enjoyed working together and what an honest conversation it was. that is exactly the sense that i got to and throughout that entire hearing and markup process. that has been my experience for every hearing we have had in the budget committee and that markup was that people that come to the table with honest disagreements and extreme disagreements but an honest conversation about what has happened, and what has confounded me is that since we reported that bill out of committee, that tenor seems to have changed dramatically. and that is the reason i ask you that question. you and i have access to the same data, and so we need good and well that nothing is when a change in medicare for those folks 55 years of age or older.

we know good and well that if we do nothing as chairman ryan pointed out, nine years the program will absolutely change. and what changed for taxpayers to have to find it differently or seniors who have to access it differently. knowing these things to be true, knowing that we have collectively have to act, now granted, back in february, the might of been a disagreement about needing to act. there was absolutely no action in the president's budget. today we have a different set of circumstances. we have chairman brian's and we have mr. van hollen is substitute that acts. given that we all agree that we have to act, what you think the tenor has changed from that very collegial, let's talk about the facts, to now let's talk less about the facts and more about where we can delict -- direct public anger? >> more and more concern is been expressed by the general public. and while the tenor might have been somewhat acceptable, the

vote count their acknowledged that we do not really accept your version of what -- of taking 55 and under and forcing them into the private market and requiring them to a absorb the growth, you give them about it that does not keep pace with medical inflation, those are important factors that would drive the risk from the government over to the individual. >> that is one of the things they're really belies me as someone under the age of 55. my dad just turned 65 and he cannot find a doctor who will take him. cannot find a doctor who will take him. we talk about forcing people out of the government-run system where they cannot buy care in this something that can get for themselves and what they like best. i'm delighted to be headed into that direction. as a taxpayer, i know for a fact i bear that risk anyway. i would bear that risk for working american, paying

additional four medicare program going bankrupt, or i will pay additionally at least i am paying additional for something i'd choose. >> you're missing the point of the middle or people are talking about bending that cost curve of medical curve. the concern i hear from my seniors, pharmaceutical costs, filling the doughnut hole was a big. going forward for them. because many of the out of pocket expenses for coming from that don't hold that they had to fill. knowing that reform is there and taking it away, you will impact of those are 55. >> that is a fascinating trend in government. i just showed up in january so i have not been privy to it. here we have the benefit not available at all six years ago. it did not exist and everyone in america was required to pay for every nickel of the pharmaceutical expenses. there were six years later and the debate is, golly, i do not have to pay for my first couple of thousand and i do not have to pay for my last thousand but i

have to pay in the middle. and someone else should bear that burden. it is troubling how quickly this entitlement has begun the move. as my understanding from mr. van hollen was that he did not let the way that the budget --mittee's plant produced that rates could reduce from 35% down to 25%. his alternative was to raise from 35% to 39.6%, is that accurate? >> the concern is that you squeeze the balloon and the will fall on someone else. someone else is picking up those payments, and that is his concern. to be a revenue-neutral situation. >> i was wondering about that. i read a report that $3.90

trillion and a loophole that the budget committee mark closes in order to move to 25% rates and a revenue-neutral way would end up closing $2.9 trillion yen loopholes, giveaways, what i would call the economic drag. -- we have about $1 trillion in drag each year. do the math. let's get on the path of economic growth. let's have a task that is simpler, they do not have all this burdensome compliance problem, a tax code that is flatter, and by having a flatter tax rate, it is more internationally competitive but also it is better for a recession.

higher tax rates manger revenue drops fast in recessions. like a california, look at the states. by having flatter tax rates, and you have more brazilian tax revenue, so it is more stable tax revenue. the third point is that we have to remember this is not the 20th-century where we can take it for granted that america will be alone economic superpower, no more. would you have five employees are 5000 employees who are probably competing against the manufacture in china or india or wherever. the tax their business is no more than 25%. so, come on. we're saying let's clean the code up on a revenue-neutral basis, and it is the people on the high yen that use those loopholes in the way. -- the high end that use those

loopholes and the way -- anyway. do we want prosperity and economic growth? at the end of the day, the role of the government is what the debate is about here. we believe the role of government what -- should be what is historically been, protect our natural rights of the people to make the most of their lives. we want to fix the safety laws net so that people can rely on self-sufficiency and have a dynamic economy of continuity so that more jobs and more businesses are being created. if the other idea is to have the government grow dramatically in size, redistribute more and more, and try to equalize the results of people's lives, not equal opportunity but equal outcome. that is a far more sadness decided and we have traditionally had. that is not what our founders envisioned. there are different philosophies hear a plea. that is what the ultimate outcome will be.

>> if you use the loopholes to allow for the trickle-down not to impact the middle and lower income strata, well, if you look at the curb for salary growth in this country over the last couple of decades, there's an exponential rise up for the income strata that you want to help. so in this course of time, those dollars that they are earning are going to rise exponentially, so that as you reduce that burden, that burden that you are cutting away is growing with time, and you see a flat curve with the middle strata, so do not try to convince me that the loophole protect those on the bottom. that rise of the salary of the millionaires and billionaires continues to rise, they are

adjusting downward and it will more than speed up that tax loophole closers. >> i do not want to get into that. >> that tells me buyer beware. jim webb half of the population is a 97% of the income taxes, but reclaiming my time. reclaiming my time. >> will the gentleman yield? >> any members who have not voted, there are few that have not voted on the second vote taking place on the floor right now. is a five-minute vote, and i try to ensure that everyone in this committee has an opportunity to participate in take whatever time they like, but i do not try to encourage the process along, i just announced that you have had to witnesses in the last half hour and we only have 16 more ago. so we look forward to a fascinating evening. >> i think the chairman for his subtlety. and i would just like to ask mr.

van hollen, we were talking about how the top marginal rates we do not think those seven impact on folks and it is a proposal to raise the top marginal rate to 39.6%, and it would not have an impact -- and might disagree with that, but thinking about the additional revenue, that raising rates for 469% would bring in, they will not actually have an impact in your considered opinion on job growth and job creation. why can we not raise that rate 10% on those clothes? that would bring in more than twice as much revenue. if we raise it 20%, that would bring in, dolly, four times as much revenue, and since it is not one impact job creation, and knowing that you had to make a lot of tough choices in the budget, why didn't you run the rate of dramatically higher? >> i would be happy to answer that question. what i said was that relatively small changes in the top rate are not the main economic

drivers of people's decision making. if you get to a certain point you have marginal tax rates which are going to have greater impact on job growth. and i want to make it clear, the question is, what are the factors of job growth? tax rate is one factor. the point of looking historically at the period of time during the clinton administration was that while they did have a higher top marginal tax rates, you still have very rapid economic growth and 20 million jobs created. the reality is that people making investment decisions look at all whole variety of things. it is interesting that we talk about how the marginal tax rate that changed during the kennedy administration. it did, but republican members are fond of mentioning that, but it went down to a very high rate, about 50%. my point is then.

going from 35% to 39.6% is not the major driver in market decisions in terms of investment and growth. i think the historical record is very clear. >> you may be able to persuade some folks about that. i wonder if we look at the competitiveness that, maybe it does not drive their decisions that greatly. i would argue that it does. but to be competitive in a global economy, we will see. but let me say both of you, the "wall street journal" called this the most in a generation. if taken a step since the -- that so many congresses have been unwilling to stay. as a young people who have to pay those bills, i am grateful to you both. >> thank you very much, mr.

chairman. gentleman, i think that to you as well. have you voted? >> yes. >> i'll wait for you. very kind of you, mr. chairman. i decided a few days ago that i would begin this hearing as i have with a couple of others wherein i cited from the king james version of the bible, the chapter of matthew. i thought it not robbery to go to the actual scriptural reference as a beginning. it is under the judgment of nations. let me make it very clear, i do

sincerely believe in total tolerance and religion and i understand the secular nature of our republic. and i wholeheartedly endorse that. i also believe that in almost any religion, some form of what i am about to say exists. what matthews says, beginning at verse 31, is that when the son of man shall come in his glory and all the holy angels with them, then shall the said upon the throne of his glory. and before him shall be gathered all nations. and he shall separate them one from another, as a shepherd divides his sheep from the goats. and he was sent -- set the sheep on his right hand, but the goats

on his left. then shall the king said unto them, come ye blessing of my father, inherit the kingdom prepared for you from the foundation of the world. for i was ahungered, and you gave me meet. i was thirsty, ye gave me a drink. i was a stranger, and ye took me in. naked, and ye chloramine i was sick, and ye visited me. i was in prison, and ye came unto me. they enjoy the right to answer them saying, lord, when we saw the ahungered and fed the, or thirsty and gave the drink? when saul we as -- when did we see you a stranger and take you in, or sell your naked and

clothing to the? warsaw you sick or imprisoning came into you? and the king shall answer and say unto them, verily, i say and to you in as much as ye have done it unto one of the least of these my brethren, you have done it on to maine. -- unto me. christen paul, since we have had dante's in sterno thrown into here, i will not go into what matthews said in the cursed and where they wind up. i will leave the portion of for another time. atlas shrugged off run away from time to time. and now would be delighted to have a concern -- a conversation

with her protagonist, john galt, in this economy. but let me ask both of you to answer this question for me. do you will -- do you feel that it is good to maintain tax cuts for the top 2% of the people in our great country? and can you give me a yes or no, both of you? mr. ryan? >> going from the gospel of matthew, i am very familiar with it, to atlas shrugged, to tax rates. i am not sure where this is all going. >> just answer my question. >> for the sake of our economy, economic growth, job creation, international competitiveness, a flatter, fairer, simpler tax code, it is a good idea for job creation and growth.

yes, i do believe that. and i do believe that as you look around the world, and look good countries that did that come and job crop -- job growth and prosperity in sued. this is not some weird, bazaar theory. it is true. time and again, you put more hurdles in front of entrepreneurs, if you penalize job creators, you get let -- you get less of entrepreneurs and less jobs. >> you did not give me a yes or no. i take that as a yes. you believe that the 2% of the wealthiest people and our great country, since they have had for a decade 80% increases in their income, that they should continue in that regard, while the least of us -- >> let's not forget that the bulk of this are small businesses.

>> they file their taxes as individuals. >>, the wisconsin and drive to the outskirts of any town, you'll see an industrial park. there will be literally businesses with 2500 employees. odds are these businesses are filing as individuals. and we want them all to have 1000 employees. we want the guy with 50 businesses to have a thousand. we want them to be internationally competitive. >> let me give mr. van hollen and opportunity. i have to tell you what i'm talking about. >> thank you, mr. hasting, for your question. that focused on the fact we need to get our deficit under control in a predictable way. you need a balanced approach to this. and to say you are going to do it at the same time you're going

to provide a tax break to very high income earners, suggests a total lopsided approach to this issue. we had a conversation of the economic growth rates during the clinton administration, the job growth rate much higher than the bush administration, even though it was in a period where real had higher rates and the fed. the mayor respond to the chairman about small businesses. because that between corporate rates and income tax rates for individuals and others. the reality is, and you can check the data on this, that the number of small businesses within come above $250,000 in america, is actually about 4%. 4% -- mom-and-pop small businesses are not generating that kind of income. >> but that income is through

these kind of businesses. >> i am glad you raised that. let's figure out why they might be. why might be the case that 4% of small businesses, in fact less, make and, above and get that amount of revenue is generated? it is because chapter s operations qualify as small businesses. all of the washington lobbying firms that make millions of dollars of year, those are "small businesses." price waterhouse is a "small business." the investment firm kkr, "small business." hedge funds, small business. i am glad that chairman raise this. why is it that the small number of small businesses generate that kind of income? they are not small businesses by any persons definition out there in the country. >> let me do with you as i did

with him so that i can proceed along. i want to know why, mr. ryan, there are no cuts other than a couple of matters that are reductions in programs outside the department of defense, like the department of energy or the coast guard, what is there in your budget or the proposed budget no cuts in defense? >> we cut defense by $178 billion. we take one under $70 billion, we agree with secretary gates in his findings that there is $170 billion of waste. we apply when hundred $70 billion back to the troops to get them off modernized and more capable, and we take $70 billion from the defense budget. >> and you agree that defense is

the largest chunk of discretionary spending. >> it is. we passed mr. van hollen and amendment on a bipartisan basis. i voted for mr. van hollen's amendment. not everybody did but it passed with a pretty big vote. >> it 1% of americans take home 25% of the incoming and seen those in comes rise by 80% in the last decade, but those in the middle income have seen the middle class fall. why you think that those that have suffered most severely under this recession should bear the greatest burden of hardship, and what does this budget do to help those people as opposed to

the wealthy, who will be fine no matter what? >> i do not think that we should do that. i think we should have tax certainty and we should not raise taxes as anybody. we need to get our economic policies right so that we can have for. i know he does not like the independent analysis, but they say that as a result of our budget, it was halted an extra $1,000 in an annual family income per year. their projections, he did not like them, but it is their projections come all $1.5 trillion yen higher wages as a result of this plan. nearly a million jobs created next year alone. " we are trying to do here, mr. hastings, is get economic growth and prosperity back on track. you really cannot fix this problem unless you get people back to work. you cannot do it unless we get

economic growth. what you really need is economic growth with low interest rates. that is another problem that we will not get into here. we have an interest rate problems and all of these budgets do not add up. >> mr. van hollen. >> the chairman mentioned the heritage foundation estimates. even a lot of republicans and economists have written in the last week saying that the heritage foundation was way off, just as they were way off as i indicated earlier when the projected that after the tax cuts under president bush that the economy would roar and create millions and millions of jobs, and in fact, we know the end of that story. by the end of the bush administration, the economy in the country had lost over 650,000 jobs. so much for the heritage foundation analysis. which it as someone who has gotten it right. >> members of the committee,

there are 13 members left in this code. i like to encourage people to go vote. those of you who are waiting, so that no one misses the vote. thank you. >> let me ask you, paul, when you have finished. inco had, alcee. >> which specific tax provision would you target in order make the broadening savings claimed in the budget? >> it is not my job. that is the ways and means committee. >> so you do not want to talk about home mortgage interest. >> they're jealous of their jurisdiction. we try not to. >> you set the framework and you have no idea. charitable deductions? local tax deductions?

>> we got a letter saying that this is the architect of the tax reform will like to include in the budget. now the ways and means committee is going to fill in that architecture. >> one question. >> if i could interject one thing, i cr court reporter struggling. could i has members to please stop talking over each other. she is trying her best to get the words down correctly. >> and now you have our role -- assumed the role that i have assumed a lot and i have violated it. that said, does the budget resolution calls for cutting income taxes for millionaires to me as a note? >> it does not. it does not. look, here's what it does. and i've tried to describe this the best way i know. we are keeping their revenues

with a are today. we're not cutting taxes. we're trying to reform the tax code. and the way we want to reform the tax code is we do not will rates in exchange for broadening the base. a higher income earner who disproportionately uses deductions and loopholes will not be able to use those kind of loopholes and therefore more of their income will be subjected to taxation. it is literally impossible to technically answer your question, because i do not know with the average person is itemize. what i do know, is that dead at 25% rate and a broader tax base, more of that person's income will be taxed. a lot of their income is not taxed at all. more will be taxed at a 25% and rate rather than at 0%. you and i cannot answer the question as to what will happen to the actual individual.

but i'll tell you what, alcee, we sincerely believe this is the way to get the economy growing. we sincerely believe this is in the best interest of job creation, entrepreneurship,, helping small businesses become big businesses, and i know we can do this, we can do this in a way that preserves the middle class. it does not raise taxes on middle income earners. putting the itemized deductions issues aside, assuming it -- a person gets the same deductions, broadening the tax rate is good tax policy in our judgment. >> thank you for the question. right of the top, when you take the top rate from 35% to 25%, for a millionaire, that is all $100,000 tax break. you can say, ok, we will take

away the deductions like mortgage interest deductions and things like that. the question is, when you do all of that for the top income earners and the middle income earners, who is going to see a greater tax break us say you had someone with to $1,000. you give them a 10% bracket the top. they start with a $20,000 tax break. the millionaire starts with them hundred thousand dollar tax break. now you're going to take away their deduction for mortgage interest. that is why the math is clear on this. at the end of the day, the millionaires are going to get a tax break because they pay relatively fewer deductions, relative to their income, then middle income taxpayers. the math is clear. you are shifting the tax burden from middle income tax burdens to folks at the very end. >> i want to less than

additional question. but i will say that a the homeless veterans in this program is cut by $75 million. food supply safety is cut by $241 million. there are tax services that help lower income families. they are cut. food stamps, the snap program, they are to be turned into a block grant. pell grants are being cut, and elementary and secondary education is being cut to the tune of $2.5 billion. the infrastructure with respect and -- with reference to transit programs, it is too numerous to mention. neglect of research, billions.

matthew and nine i feel would do this differently for the least of us. and paul did not answer me with reference to defense. and he and i will have that discussion. he answered what he wanted to say, but there is no dollar cut from the core of the defense in this program. those cuts come from energy and from the coast guard and programs outside the department of defense. i said repeatedly here in this committee, i could go across the 14th street bridge to the pentagon, and i could find you a whole lot of money that would help take care of the least of us. thank you, madam chair. >> with the gentleman from new jersey like to respond? >> just a response. i know paul made the point, but

we had that debate in the committee. there were a number of us who are on the exact same page as you are on the point. there is more than just the proverbial wisdom or fraud, and abuse on their. and that is something that both sides of the aisle are eager to look to and tell them to. in mr. nugent. >> for all this discussion, i am new to all this back and forth. but is the corporate tax rate changing? with the rise in the budget? -- ryan budget? >> yes. to that when the president spoke to the state of the union, one of the things that he said, i'm asking democrats and republicans

to simplify the system. it rid of the loopholes, level the playing field, and use the savings to lower the corporate tax rate for the first time in 25 years. without adding to our deficit, it can be done. the president said months ago at the state of the union -- i wonder, does this meet one of his requests as relates -- we have a change of players at the table. in your estimation, does this meet the request the president made in the stated union regarding lower in the corporate tax rates and by being -- without adding to our deficit. >> our budget does that. we did say let's lowering without adding to the deficit. we had revenue-neutral tax reform. that means you do not lose revenues. we do that on individuals, i do

not think he wants to go there. to you when you total of raising the tax rate to 39%, and we talk about millionaires, but who does that actually reach down and touch, the 39% from to in the 39% would be direct it would apply to couples over to order $50,000. >> that is your definition of a millionaire? >> no, but most of the income that you generate from that is at the very high end, millionaires, yes. the great majority of income from doing that it generated from millionaires. >> if you do the math with someone making $250,000, the difference between 25% and just 35%, not even going to 39% is almost $25,000 a year. >> that is what the president's proposal. he would make the top rate of

48.8%. it goes beyond 39%. >> what we're talking about is the marginal interest rate on income over to under $50,000. you're not talking about the first dollar. and we said to our republican colleagues in the budget committee, ok, if that is really your problem, but doing to under $50,000.500000 dollars, here's your opportunity to do something differently. apply to folks over $1 million. it was a party line vote and they wanted to protect people over $1 million for the raid. -- for that rate. >> thank you, madam chair. mr. ryan, alice is looking to this document here.

i was looking at the deficit figures on your budget. i see it that the deficit coming you get it down to $420 billion. i wanted to see if you consider that to the end of the plan. >> what pages this? >> page #40. i am looking at the total surplus and deficit line. basically, again coming to get down to the $400 billion, and it hovers there through the end. i am wondering whether you consider that a sustainable deficit level. >> as defined by the president's fiscal commission, it is. the presence fiscal commission said it is primary balance by 2015. primary balance is balancing the budget-interest, and this does that. it has been defined by the

treasury, the fiscal commission, as sustainable deficit. >> the unified budget. this gets down to primary balance and then we stayed very well below that. in the 10th year, i think it is 1.7%. 4.9%. we get to primary balance by 2015 and that we could dramatically lower by debt. in contrast, cbo restored the president's budget and he gets nowhere close to primary balance. >> it's rather rare that a freshman this to chair a committee. i like to congratulate him. i never had that the station during my first term. i offer you my sincere congratulations. you keep using that term primary balance. >> you are asking about sustainability. >> on page 40, the surplus

deficit total, again, there is a deficit of over $400 billion. and the question is, is that level of deficit, $4 billion, is that a little you feel is sustainable? >> is clearly too high. but as every economist measure sustainability, yes, it is underneath that level. let me just tell you. >> a quick question to clarify that. at that level of deficit, $400 billion, the third debt go up or down? >> every year there is a deficit -- of course you are adding to the dead. -- the debt. the question is, as a percentage of the economy. is your mortgage relative to your income?

is the business longer to get for your business small enough or the right size that you can cash flow it? is that that your country is taking on the right size relative to your country's ability to pay it? and so for primary balance, if you are at or below it, the economy is growing but your dad as a percentage of your economy is shrinking. the cbo says our budget does is that in 2014 the debt as a share of our economy, the key measurement here, which is 74.5% and then goes down from their precipitously to the point where it is almost paid out. the president's budget -- >> to where it is ultimately paid off, at 2021. >> we have longer-term storing on our budget. >> is there are record of that?

>> i believe that there is. >> of what to certainly complement the work of the committee, the work of the democrats and the president, we're finally seeming to be serious about making progress on this issue. earlier today, a lead the debate on the rule about the continuing resolution and it was a lot of sound and fury over nothing. i think what the committee and the ranking member and the president had been talking about in the republican budget, the democratic budget, reflecting different values, the president's budget, are finally beginning to address the matter. i wanted to give mr. obama -- mr. van hollen the chance to talk about reducing the deficits and a sustainable levels and the trade-off in priorities about

how we share the pain, if you will, and who feels the pain of getting to the budget surplus or neutrality. >> as i said, earlier, that is exactly the question as we approach this. yes, we have to reduce our deficit in a stable predictable way. a democratic alternative does that. it does reach primary balance in the year 2018 and it does it in a way in the cortex -- in a way to protect investments in our economy, infrastructure investments, the we need to make as a people to make sure that we win in a very competitive, global economy. and at the same time, makes sure that folks on medicare have that guarantee, and the folks on medicaid, whether seniors in

nursing home or disabled individuals or low-income kids, continued have the health care they need. this is always a question of what is the balance. we believe our approach represents balance and that the republican budget is a one-sided approach. >> all the approach is before us including the presidents, including the alternative budgets, or the amendments, they are all significant improvements over the status quo. with regard to reducing the deficit. and this body will do its work on where our priorities are. i am confident that thanks to the work of the members of the majority and minority in the budget committee in articulating their respective visions, this body will be able to begin to get our arms around the real issue facing this country for the potential mountain of debt that threatens to bury the next generation. >> that will conclude the hearing. this panel, thank you very much.

wishful thinking on my part. we only have 60 more. you better hurry down, chris, the time is almost up. this is on final passage. we will get out for you, van hollen. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> this year's studentcam competition as tenants around the country to consider washington, d.c. through lenses, today's third prize winner addressed an issue that help them understand the role the federal government. >> our homes, we laugh and sleep in them. what happens if someone takes it away? millions of families have already lost their homes due to one problem -- home

foreclosures. home foreclosures can happen to any house the matter what shape or size. you may be wondering, what exactly is home foreclosure? >> foreclosure is when a party cannot repay the bank alone is that the bank gave them. >> what happens is that the bank will file a petition to foreclose on the property. after that, the bank has to prove that the owner or holder of the note and the mortgage that they are foreclosing on. once that is proved, the bank will issue an order of foreclosure. broadcasting live with katie. >> in october, 2010, many housing units and saw for cluster. every 189er) won at housing units. to in this is an affecting this

neighborhood to the fact that most people do not want to live in neighborhoods full of foreclosure size. >> foreclosures are a huge problem for not only the families, but for the lenders who get the foreclosure back. they have to sell the property. obviously they have to leave the house once the home was taken over. >> how forecloses have affected the economy. people who are staying in their homes cannot sell their homes because of the fact that home prices have gone down. we talk to a home's selling expert. it how quickly are foreclosed homes sold in knoxville? >> the average stay is about 120 days for a regular sale. as far as foreclosures, how it's about 60 days would be about the normal time.

>> there are job losses, secondary lending issues, and the ability to verify income. just to name a few. >> it is like a domino effect, one that will lead to another. another problem homeowners are facing is the robosigning. aey're signing them without value in them first. it may cause foreclosure cases to be put off an all-out guilty parties to stay in the home and definitely. this is causing the federal government to stop trusting what banks are saying in foreclosure of petitions. some people do not believe that. >> we need to hear one of the regulators say, here is what we have done to sanctions servicer ms. behavior. we saw at and we acted in we did this. i did not hear this. if i did not hear this, i would

at least to them say, here are the kinds of sanctions that we can to its servicers misbehave. i did not hear that. what i heard is that we are investigating it, we are on in, we hope to mono more than a month or so, and then we will do something. >> however the federal government understands that rowboats signing is not the only problem at home strugglers are facing. to in the american dream is being tested by a home mortgage crisis that not only threatens the stability of our economy but also the stability of families and neighborhoods. it is a crisis the strikes at the heart of the middle class. the homes in which we invest our savings, and build our lives, raise our families, and plant roots in our communities. >> president obama has been thinking of ways to help struggling homeowners is the day that he took office.

>> those who have been charged elite must confront very difficult decisions. cutting spending we do not need in order to invest in the things that we do. as president, i'm committed to doing my part. >> thinking of new ideas to help struggling homeowners. >> the most recent is the hamp program. this is the home affordable modification program. to in it was designed to help people lower their payments to be able to maintain their home and not have to move out of it. that is what that was the goal. in this program will address many homeowners problems they can determine which mortgages need help and what kind of help that they can use. the counselors look at many things, the payment history, and the fico scores. the federal government created a program calledhafa, which stands

for home affordable foreclosure alternative program. the reasons hafa was started was because many homeowners did it on alternative to for preventing for closer. hamp was not enough. even though it was created, hamp is still in action, and with many millions of dollars put into the program, there is a brighter future head. and knows, we might even a pledge to halt -- call home again? >> go to studentcam.org to watch all the winning videos. continued the conversation at our facebook and twitter pages. >> up next on c-span, the house debates federal spending for the rest of the fiscal year. president obama presents his deficit reduction plan. followed by reaction from house republican leaders. >> state and municipal governments are facing record

budget deficits this year. a house oversight and government reform hearing looks at the problem tomorrow. witnesses include wisconsin's gov. scott walker and vermont governor. live coverage begins at 9:30 a.m. eastern on c-span3. >> follows c-span on twitter. it is the fastest way to get programming and schedule of dates as well as all links to events that we have covered. you can join in the conversation and tweet concert -- questions directly to an guest. book tv, and c- span radio, get started at twitter. >> now available, the congressional directory, a complete guide to the first session of the 100th of congress. new and returning some house and senate manners with contacted for mission, with twitter addresses, and committee assignments. information on the white house, supreme court justices, and

governors. order online at c-span.org/stop. >> the house on wednesday consider the spending bill for the rest of the fiscal year which ends september 30. a spending bill needs to be passed this week to avoid a government shutdown. this part of the house debate begins with rules committee david dreier. this is an hour. mr. weiner: thank you, madam speaker. the speaker pro tempore: thank you. for what purpose does the gentleman from california rise? mr. dreier: i yield the customary 30 minutes to the gentleman from boulder, mr. polis, during which i yield myself such time as i may consume. during consideration of the rule all time is for debate only. i ask unanimous consent that all members may have five legislative days to revise and extend their remarks on the matter before us. the speaker pro tempore: the gentleman from california is recognized for one hour. mr. dreier: thank you very much, madam speaker. this rule provides for consideration of three measures, h.r. 1473, h.con.res

35 and h.con.res 36. h.r. 1473 funds the government for the remainder of the fiscal year 2011. h.con.res 35 and 36 are enrolled -- are enrollment correction measures that end federal funding for the president's health care plan and planned parenthood. as these measures represent a final agreement on this fiscal year's funding on par with a conference report, this rule provides simple up or down votes -- simple up or down votes on all three of these items. furthermore, this rule directs the clerk of the house to refrain from finalizing the enrollment of h.r. 1473 until the senate has acted on all three measures to ensure that the enrollment corrections resolutions get full consideration. h.r. 1473 will be debatable for one hour. h.con.res 35 and 36 will be debatable for 20 minutes each.

now, madam speaker, it has been a long, difficult, ugly, messy process, but we have finally achieved an important victory for the american people. today's underlying continuing resolution is a step toward -- a step toward the fulfillment of a fundamental promise that was made to the taxpayers. we will halt the practice of reckless and unchecked growth in federal spending and cricketcally important, madam speaker, we will -- crickcally important, madam speaker, we will re-- critically important, madam speaker, we will reverse the course we are on. it will impose the single largest cut in nondefense spending in our nation's history. it also implements a number of reforms that will ensure greater accountability in how tax dollars are spent. madam speaker, this is not the

end of our work to restore discipline and accountability to the federal budget. far from it. after fighting so hard to get to this point, it's important to point out that the truly difficult work still lies ahead for us. this resolution is also not the perfect measure we were all working for. many of us fought hard to have even greater cuts and more significant reforms. but today's action is so critical because it is the turning point. it is a turning point, madam speaker. it's that profoundly important first step. the american people have said enough is enough and this congress is finally responding. we're ending an era that has seen growth in nondefense discretionary spending over the past few years of 82%. under speaker pelosi, madam speaker, we have had an increase in nondefense discretionary spending of 82%.

we are making serious, meaningful cuts in the size and the scope of government. but as i said, these are only just the beginning. when we conclude this debate, we will turn directly to the fiscal 2012 budget. our very thoughtful budget committee chairman, mr. ryan, has put together a bold budget plan that seeks to tackle the fundamental reforms that are absolutely essential to the future viability of our economy. if the process we have just come through has been difficult, the task that lies ahead is herculean. a $1.6 trillion deficit poses an almost unfathomable challenge. it demands a tremendous level of seriousness and resolve that each and every one of us must rise to.

the consequences of failing to do so would be both disastrous and predictable. we've already gotten a strong dose of the economic challenges that would ensue. for months and months on in we've dealt with a very painful lack of job opportunities. the stifling nature of the national debt, the tax and regulatory uncertainty, the policies that favor government intervention over entrepreneurial empowerment, all of these have contributed to our economic challenges. it is increasingly apparent that the recent positive movement on job creation has been fueled by our effort to rein in wasteful government spending and restore the certainty that businesses need to make new investment. as we continue our efforts to impose fiscal discipline, i hope and believe we will continue to see positive news

on the jobs front. but these economic challenges are far from over for most hardworking americans. we know what difficult times we and the american people are facing. we know very well how painful these challenges have been, but they pale in comparison to the crisis that will come if we do not have the courage to fundamentally transform the way this government spends money. we need to look no further than the euro zone to see what's in store without a dramatic change in course. we've seen western european economies come to the brink of collapse, crippled under the weight of their sovereign debt and nearly dragged some of the world's largest, most stable economies along with them. the coming budget debate will be a moment in which we must reject this failed economic model. today, with this historic spending cut, we are paving the way to do just that.

now, madam speaker, this is not the end of our work, but it is, as i just, just the beginning. i urge my -- as i just said, just the beginning. i urge my colleagues to support the rule and the underlying resolutions. with that i reserve the balance of my time. the speaker pro tempore: for what purpose does the gentleman from colorado rise? mr. polis: i yield myself such time as i may consume. the speaker pro tempore: without objection. mr. polis: madam speaker, i thank the gentleman from california for yielding me the customary 30 minutes. for all the talk of republicans' commitment to cutting spending, there were several odd things about this bill before us that would leave one to believe that it's more of a partisan political exercise, a serious attempt to get the nation's fiscal house in order which we deserve as americans. under this bill, critical services that many americans rely on to educate our children, keep our streets safe, improve public health, keep our water and air clean, would face tens of billions of dollars worth of real and difficult cuts. times are tough. we know we have to cut

spending. ok. so why does this bill then provide the pentagon with an additional $5 billion above the previous request at a time when the civilian and uniformed military, including thoughtful policymakers from both parties believe that we need to reduce spending across the board? admiral mullen stated that our national debt is our biggest national security threat. he also noted that the past duke aid's doubling of the department of defense's budget has led to undisciplined spending and waste within the department. secretary gates concurs saying that we can't hold ourselves contempt from the belt tightening. despite our military and those involved in the spending, two can't be spared. not only have they been spared by the republican majority but increased by $5 billion. the recent bipartisan commission on fiscal responsibility, often called the simpleson-bowles commission, called for substantial defense reductions over the next 10 years. they had cuts that would have led to $60 billion in the first

year and kept our nation safe. in fact, if we implemented the commission's recommendations around security spending we would save $100 billion in 2015 alone. but republicans didn't go after their favored areas of big government spending. instead, they went after our efforts to strengthen our schools, keep our water clean and keep our streets safe. and the rest of their so-called spending cuts don't seem to be saving much at all. in fact, yesterday we had an interesting discussion in the rules committee about whether this bill really even saves close to the $38 billion claimed. apparently most of the savings are from allocations of money that wouldn't be spent anyway. an associated press story yesterday called this bill budget fricks saying $23 billion of the $38 billion aren't savings. this is unspent census money, the renewal highway programs that can't be spent because of restrictions that have already been set by other legislation.

and one calls this bill a spending cut holcom. i would like to submit this for the record. the speaker pro tempore: without objection. mr. polis: it is $18 billion in cuts and $28 billion in fake cuts. i asked the chairman of the appropriations committee if he could explain that discrepancy and he demeasured on that account. so in the end what have the republicans accomplished? i'd like to talk about this graphically and sort of show the american people what we're talking about. now, these charts -- i use "the wall street journal" which credits republicans on spending cuts than the associated press. out of caution, i want to trust "the journal" to use their figures even though they have less than the a.p.

but "the wall street journal" says the majority of the republican cuts are in fact holcomb cuts. this is the deficit. this is the deficit. ok. this is the c.b.o., congressional budget office's estimate of the deficit. $1.399 trillion. this is what we're talking about here. this is the continuing resolution savings. that's it. not one penny more. let me sort of take an example of an american family to kind of -- we have to take a few sdemrours off of it for most people to understand these figures. let's say the deficit is $139,000. so $139,000. in my business -- i was a small businessman before i came to congress. i understand how to balance a budget. i know most american families are trying to balance their paycheck, make their mortgage payment. $139,000 you lose in a year. ok. that's tough. you have to take out a second mortgage, max out your credit cards. you try to cover that $139,000. ok. then you know you got to make some serious changes. what are you going to do?

you talk to your credit card companies. you shut down your business. what do you do? you figure out how to lose $137,000 the next year. you know what? that $137,000 is going to put that american family out of business just as surely as that $139,000, but that is the republican approach to this bill. now, let me talk about some of the alternatives we have before us. mr. dreier: will the gentleman yield? mr. polis: you can discuss this on your own time. i want to go through this excellent chart. if we were serious about deficit reduction republicans could have supported several amendments offered by democrats and voted on in the house when we debated h.r. 1. the democratic amendments alone would have cut spending by nearly $129 billion, more than three times the amount that's even claimed in this bill. here's some examples. congressman stark and congresswoman lee offered one

amendment that would have deduced defense spending to its level three years agoment we were already in two wars at that time as well, saving $36 billion in the first year alone and that would have left in tact a defense budget of $688 billion more than enough to meet the security needs of our nation. congressman nadler offered an amendment that would have finally ended our support for the war in afghanistan, saving $90 billion. congresswoman woolsey offered an amendment that would have saved $415 million by bending the b-22 osprey program. just yesterday in rules i also proposed an amendment that would have deduce -- reduced our troop presence in europe. our european allies, madam speaker are some of the richest countries in the world. it's time they pay their fair way. what is the strategic rational for an ongoing presence in germany? the nazis are gone, the soviets are gone. even former secretary of defense rumsfemmed has questioned the ongoing presence of our troops in europe. i also proposed an amendment eliminating the drug czar. they spend $21 billion a year

yet drug use has gone up since its inception. we're never going to ballot entire budget by reducing the funds. clearly we all can agree we need to look at revenues and entitlements but year you're not going to make even the slightest dent in the deficit. if you exempt defense spending from any cuts. in this continuing resolution before us, republicans have exempted more than half of the domestic discretionary spending from any cuts and it becomes very clear that the republican plan isn't so much about serious deficit reduction than it is about protecting their favorite government, big spending, while simultaneously slashing away at their favorite targets like education, the environment and the safety net. here's what we can potentially accomplish if we work together. this shows the republican cuts in this c.r., we even added for the sake of argument the hoe

come cuts -- the hokem cuts and we included the proposed democratic amendments. i think this is something that we can be proud of. and you know what, madam speaker? i think more democrats would support a program that didn't only cut the programs that many on my side of the aisle feel strongly about but also made some of the difficult decisions with where the real money is with regards to defense and security spending you have the. just like that american family that we raised digging its way out of a $127,000 a year loss, we need to make real impacts on reducing the federal budget deficit. this will take actions across the aisle to make sure that we can leave our country in a better situation and help the next generation fight its way out from the burden of debt that we risk placing upon them if we continue the big spending policies of the republican party. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time.

the gentleman from california. mr. dreier: madam speaker, let me begin by congratulating my friend from boulder, my rules committee colleague, for his very thoughtful remarks and i'd like to respond with a few important points. first, i was struck with the fact that he went through the litany of amendments that were debated on h.r. 1. underscoring again that we have for the first time in decades seen a free and flowing debate and an opportunity for votes to take place here in this institution. it hadn't happened before on a continuing resolution as we saw it in our consideration of h.r. 1. i also want to say that while my friend continued to point the finger of blame somehow characterizing this as a republican plan, i'd like to remind him, madam speaker, that this happens to be the result of a negotiation that has taken place with three democrats, the

president of the united states, the vice president of the united states, the majority leader of the united states senate and one republican. the speaker of the house of representatives. by a 3-1 margin in the negotiating process republicans were outnumbered and so i think that it's a mischaracterization to describe this as somehow a republican plan that is before us. now to the issue that was raised about a cut being a cut. the former director of the congressional budget office made it clear answered called it that, a cut is a cut. i know this attempt is being made to somehow characterize the fact that dollars have not been spent so that means you're not actually cutting them. well, last night in the rules committee the very distinguished ranking minority member of the committee on appropriations, my good friend mr. dicks, pointed out something that everyone in this institution should know and that is the process of

reprogramming that takes place within government agencies. we know full well that the movement of money, since money is fungible, that takes place within these different agencies, is standard operating procedure. so, madam speaker, to claim somehow that if dollars haven't actually been spent that they're not being cut is just plain wrong. now, madam speaker, while i talked about the negotiating process that ended up with the president of the united states, the vice president of the united states and the majority leader of the united states senate and the speaker of the house leading up to that, we had our very, very diligent and hardworking new chairman of the committee on appropriations, my friend mr. rogers, who has stepped up to the plate and taken on the responsibility, in fact some call it tongue in cheek but he has been very serious about

being the enforcer of ensuring that we cut spending and he's actually renamed his appropriations committee the disease appropriations committee by virtual -- disproportions committee by virtue of the fact, madam speaker, that if we don't get our fiscal house in order we are going to be in deep, deep trouble. and so, madam speaker, i want to say that, again, he was one of the negotiators leading up to the final process here and i'd like to yield such time as he might consume to my very good friend, the chair of the committee on appropriations, mr. rogers. the speaker pro tempore: the gentleman from kentucky is recognized for as much time as he may consume. mr. rogers: i thank the distinguished chairman of the rules committee for the time here. and to thank him for the diligent work that he continues to do as chair of the rules committee, the sort of traffic cop for the bills that reach this floor. i want to expand a bit, madam

speaker, on a point that chairman dreier alluded to earlier and that is the historic nature of the bill that we will be considering on the floor. as the chairman pointed out, under speaker pelosi discretionary spending in those two years increased by 82%, a record. with this bill we not only are arresting that growth but we are receding actual discretionary spending by a record amount, nearly $40 billion in actual cuts in spending. that has not ever been accomplished by this body in its history, in the history of the country. the cuts in this bill exceed anything ever passed by the house.

it's the largest cut ever by four times. the large of the previous single cut was in 1995 when we cut around $9 billion. with this bill you cut almost $40 billion. now, i don't understand sometimes my friends on the other side of the aisle when they criticize this bill. it's being supported by your president. he says, pass the bill. it's what we agreed upon. it's being supported by senator reid, the leader on the senate side. it's being supported by the speaker of the house and it's being supported by an overwhelming number of members on this side of the aisle and i predict a great number of democrats will likewise support

the bill. now on the defense portion of this bill, let me briefly refer to it. the provisions in this bill about the defense budget is exactly like it was when all parties last december on both sides of the aisle in this body and on both sides of the aisle in the senate body agreed to the expenditures for the department of defense. we simply lifted that agreed upon provisions for the defense department and dropped them into this bill. there are two people in this body that know more about defense spending than any of the rest of us. and that's the chairman of the defense appropriations subcommittee on appropriations, bill young of florida, and my good friend, mr. dicks, the ranking member of that

subcommittee and the ranking member oned full appropriations committee, norm dicks. he worked long and hard with bill young for these provisions. and i absolute him for -- salute him for it. it's good work. it does the right things. it cuts back on the president's request for defense by some $7 billion or $8 billion. below what he requested. it does increase in real dollars about $5 billion over the current spending rate. but we're in three wars and there's no reason at all for us to shirk from the responsibility to provide adequate funding for our troops in combat. and that's the reason why -- one of the big reasons why we support this bill, why the president supports the bill and why senator reid in the senate supports the bill. and so let's focus on actual cuts in spending.

we all profess that we want to cut back on the deficit for the year and for the ensuing years. the deficit this year, $1.4 trillion in just one year, largest in history, adding to a debt that exceeds all of our fears of some $14.2 trillion. we all say, let's cut back on spending. here's your chance. here's your opportunity. if you profess to be a fiscally responsible member of this house , you have a chance, an obligation, to vote for this bill. and support it. it's historic, we've never been here before. we've reached a pinnacle. and a great opportunity for us to show to the rest of the country that we're serious about controlling the free spending

nature of this body. this is your chance. don't miss it. the speaker pro tempore: the gentleman from colorado. mr. polis: i yield myself a minute to respond. the gentleman from kentucky called this a historic bill. i think much more of this kind of history and we risk making our country solvency history by drowning ourselves in development for a family business that lost $139,000, losing $137,000 might be nice, but it puts you out of business just the same. i continue to express our wish that we included some of the democratic cuts in this. that added up to four times the amount of the proposed republican cuts in this bill. as the bar put it, the cutting of this bill is a lot of sound and fury signifying nothing with that it is my honor to yield three minutes to the ranking member of the rules committee, the gentlewoman from new york, ms. slaughter. the speaker pro tempore: the gentlewoman from new york voiced for three minutes.

ms. slaughter: thank you, madam speaker. and i thank the gentleman for yielding. and i want to talk about a different historic perspective. this bill is different, all right, and i want to try to explain that to you. but first i want to say, we weren't elected, any of us, to congress to prove that we can barely keep the government open and alive. that was never why we were sent here. we're here to make america stronger and looking at this bill we are utterly failing in achieving that goal. in addition to the unnecessary and politically driven cuts in the legislation, the process that brought the bill to the floor is a mockery of regular order. never before again, let me say in this history of our nation has this rule -- what we're doing here today are three bills under one rule. we think we're going to vote for one, that would be the budget for the remainder of the year, but there are two other bills here to be voted on and i think you might be surprised at. it certainly took us by surprise.

one of them, completely defunds planned parenthood. having nothing in the world to do about cutting the deficit. mr. dreier: will the gentlewoman yield? ms. slaughter: i will not. the second one takes away the health care bill. a matter of that importance is added as a correction onto this bill. what they said they'd like us to do is correct legislation that has not even been passed. that takes a lot of imagination. but what is more serious? and i believe what they have done here is add an unprecedented provision that raises serious constitutional questions. under this rule -- now, may attention here because i don't want children to believe it. this is not the way we do things. after the house and senate have passed this bill and it comes back over to the house, the house will hold it and will not send it to the president. they will hold it themselves

letting the government shut down again until the senate votes to defund planned parenthood and to kill america's health care. now, that is very similar to what we did here a few weeks ago. it may have been last week for all i can remember when you're working so hard. it was probably one of the silliest things we have done in any legislative process in the world. they really passed a bill on this floor that said we already passed a bill and sent it to you, senate. the senate took the bill up and it failed. so then the house response to that failure was, if we don't hear from you by date certain then we're going to just say that the house bill is the law of the land. now, all of you that have been to school that the house passes

the bill, the senate passes a bill. if necessary a conference committee recognize sides of the aisle the two bills, makes them the same, and it requires the president of the united states' signature. but not in this house. you can believe 10 impossible things before breakfast here easily because we do it every day. the speaker pro tempore: the gentleman from california. mr. dreier: madam speaker, i yield myself such time as i may consume, and i'd like to engage in a discussion with my distinguished ranking member if she would like on the issue that she just discussed. i guess we won't be engaging in a discussion, madam speaker, on these -- mr. polis: will the gentleman yield? mr. dreier: yeah. mr. polis: i think what the gentlelady said is that the senate will have to vote on and not that they had to pass it. mr. dreier: reclaiming my time. i had -- there are several things i'd like to address. first, the gentlewoman's time has expired began by saying that never -- first the gentlewoman began by saying

that never before we had things come forward in that matter. that is wrong. time and time again under both political parties we've seen the rules committee report out measures that do in fact cover multiple issues. and so this is not unprecedented, as the gentlewoman has just said. second, i think it's very important for us to clarify the fact that what we are voting on is an agreement that is supported by the president of the united states and the majority leader of the united states senate. and part of that agreement is that the senate will not vote to defund planned parenthood or vote to actually bring an end to funding for the health care bill, but it will consider these measures. and i think it's important, madam speaker, to make it clear. the only thing that we are doing in this rule is ensuring that that agreement is

enforced. and so, madam speaker, i think that it's clear that many of our friends on the other side of the aisle are not happy with this -- with the fact that their president and the senate majority leader has negotiated this agreement. again, i don't like the agreement just like they don't like the agreement. i don't like it because i don't believe that it goes far enough, but it's very important for us to realize that this is simply a first step. it is a bold first step. as the chairman of the appropriations committee has just said, madam speaker, it's the step which in fact is the largest -- four times the largest cut we ever had in the past. it is a cut of $40 billion. and by virtue of that agreement we are making that first step, but if you extend this out it will have cuts that total $315 billion.

and as i said, we are just beginning the debate this week with this very, very important budget that will be considered in the rules committee today and tomorrow and friday on the house floor. i also have to say that one of the reasons that we're having this debate on the rule today and voting on thursday on the actual continuing resolution is that we put into place a very important change in the rules at the beginning of this congress that allows unreported measures, states that unreported measures must in fact comply with the three-deleover requirement that exists for reported -- three-day layover requirement that exists for reported measures. as we know this measure was filed at 2:00 yesterday morning here in the house and because of that filing, to ensure that it was put online as the chairman of the appropriations committee said so that the full membership and the american people, the media have the

opportunity to see this measure, we have done that and that is the reason that we are going to be holding this vote on thursday and that's the reason that we're able to have the kind of free-flowing debate that we are. madam speaker, this is an agreement that no one is happy with. but it's an agreement that we've come to in dealing with the two political parties and i'm going to urge my colleagues to support it and with that reserve the balance of my time. -- with that i reserve the balance of my time. the speaker pro tempore: the gentleman reserves. the gentleman from colorado. mr. polis: it's a first step towards bankruptcy with its cuts. madam speaker, i'm proud to yield three minutes to the gentleman from massachusetts, a member of the rules committee, mr. mcgovern. the speaker pro tempore: the gentleman from massachusetts is recognized for three minutes. mr. mcgovern: i thank the gentleman for yielding. madam speaker, i rise in strong opposition to this closed rule and to the underlying bill. and i want to re-enforce the comments of the gentlelady from new york when she said that the issue of defunding planned

parenthood or what your opinion is about the affordable care act really has no place in this debate. it shouldn't be tied to anything, and the fact of the matter is that they're intentionally injecting these kind of polarizing issues and obviously all of my friends on the democratic side, that's the reason why you should vote against this rule. i'm pleased that the republican leadership of the house decided that it was not in anyone's interest to shut down the government. i'm also pleased that the leadership ignored the chance of shut it down coming from the most extreme elements of their party. but i'm not pleased, madam speaker, with this so-called compromise. this bill cuts the wrong things too deeply and ignores some of the things that could stand to be cut. the cuts target the poor and the middle class, the very people who can least afford it as we struggle to recover from the great recession. meanwhile, the very wealthy and the special interests get away

scott free. student aid programs get cut. children's health care would be cut. transportation funding to repair our roads and our bridges would be cut. environmental protection would be cut. the cops program, which helps local communities stay safe, would be cut. investments in science and technology research would be cut. but the defense department, well, they get a $5 billion increase. oil companies keep their sweet, hard tax loopholes. big agriculture keeps their subsidies. that's not fair, madam speaker, and that's not right. i am all for a leaner government, but i'm not for a meaner government. i'm for balancing the budget but i'm not for balancing the budget solely on the backs of the poor and the middle class. if you want to get to a balanced budget there needs to be some fairness in this process. and if you think that this bill is troublesome, just wait, because later this week we'll

be debating the republican budget proposal for 2012, a budget that would represent the largest redistribution of wealth from the middle class to the rich in american history. it is a budget plan that ends medicare as we know it. it is a budget plan that tells our seniors, we want you to pay more and you will get less. well, there are some things worth fighting for, madam speaker, and the protection of medicare is one of them, so i look forward to that fight, but in the meantime i urge my colleagues to reject this yet again another closed rule and i urge us to reject the underlying bill. we can do better than this. i yield back the balance of my time. the speaker pro tempore: the gentleman yields back. the gentleman from california. mr. dreier: madam speaker, i yield myself one minute to say first to my friend from boulder that the notion of arguing that a $40 billion cut is going to take us down the road to bankruptcy -- mr. polis: will the gentleman yield? mr. dreier: will be absolutely prepostruss.

mr. polis: it is in the $15 billion to $20 billion according to "the wall street journal." mr. dreier: madam speaker, reclaiming my time. a $40 billion cut or a $15 billion cut, or a $15 billion cut cannot be characterized of taking us down the road to bankruptcy. we all want to cut more in spending. i mean, it's very clear. now, my friend from worcester has just made this argument about the priorities we have, madam speaker, and i yield myself an additional minute to say that i think it's important for us to look at the preamble of the united states constitution. whenever we're debating defense appropriations bills or the defense authorization bill, and i'm so happy that my friend, mr. dicks, the distinguished ranking member of the full committee and the defense appropriations subcommittee is here. i always argue that the five most important words in the middle of the preamble of the united states constitution are

provide for the common defense. now, with all due respect of the priorities that we have, ensuring that we do care for those who are truly in need, all of these things can be done in other levels of the government. only our federal government can deal with our nation' security. as chairman rogers said we are now by virtue of the decision that the president of the united states has made in the midst of three wars. i want to bring about spending cuts and i believe that governor haley barbour was absolutely right when he says anyone that says you can't cut defense spending has never been to the pentagon. we want to encourage defense sharing, and in fact we are focused on ensuring that we do get the best, the best bang for our buck. and so, madam speaker, recognizing the priority of the federal government -- priority the federal government has for cuts -- the speaker pro tempore: the gentleman's time has expired.

mr. dreier: i think this is the right thing for us. with that i reserve the balance of my time. the speaker pro tempore: the gentleman from colorado. mr. polis: i appreciate his willingness to look at defense spending. i know the gentleman from kentucky mentioned we're in three wars. perhaps part of the answer is to be in two wars or one war or perhaps we can be at peace in our lifetime. i yield two minutes to the gentlewoman from district of columbia, ms. eleanor holmes norton. the speaker pro tempore: the gentlewoman from the district of columbia is recognized for two minutes. ms. norton: thank you, madam speaker, and i thank the gentleman from colorado for yielding to me and for his work on this bill. madam speaker, the district of columbia has no vote on the rule or the bill under consideration, yet, the only controversial amendments in this bill involve only the district of columbia. the bill is remarkably clean. there are only four out of 50 or so attachments survived. not one -- yeah, there's the

district of columbia. the only controversial amendments violate the district's most basic right to self-government. one has to do with private school vouchers. only for the district of columbia. a bill we didn't ask for, a bill we weren't consulted about and a bill we don't want. if my -- the rules committee refused to recognize my amendment which would redirect the money to the d.c. public schools and to our own public charter schools, 40% of our children go to this alternative, it has a long waiting list, to our choice, not the republicans' choice. the second amendment would strike a shameful -- the second -- my second amendment would strike a second writer that keeps the district from spending our own local taxpayer

raised funds on reproductive choice for our low-income women. local money, local choice. the majority proposed to close down the government rather than pass my amendment to allow d.c. to spend its own local funds. now, the majority wants a rule with amendments that profoundly affect only the district of columbia. i will have no vote on this floor on any part of this bill. no wonder -- the speaker pro tempore: the gentlewoman's time has expired. ms. norton: i appreciate the gentleman. the majority will allow a vote on every other member -- i wonder if that's my district -- no wonder the mayor of the city council and residents have taken to civil disobedience. i yield back the balance of my time. the speaker pro tempore: the gentleman from california. mr. dreier: madam speaker, may i inquire of my friend of how many speakers he has remaining and also how much time remains on each side?

the speaker pro tempore: the gentleman from california has 8 1/2 minutes remaining. the gentleman from colorado has 12 1/2 minutes remaining. mr. polis: we have three speakers, possibly expecting a fourth. mr. dreier: i reserve the balance of my time. the speaker pro tempore: the gentleman from colorado. mr. polis: thank you, madam speaker. it's my honor to yield two minutes to the gentleman from new jersey, mr. andrews. the speaker pro tempore: the gentleman from new jersey is recognized for two minutes. mr. andrews: i ask unanimous consent to revise and extend my remarks. the speaker pro tempore: without objection. mr. andrews: thank you, madam speaker. madam spea i rise that says to the operating departments of our government, see if you can get by on 95% of the money you had last year. i think that makes good sense and i commend chairman rogers and mr. dicks for making sure that pell grants, title 1, special education are fully funded and protected and frankly salute both sides for leaving aside extraneous matters like not funding planned parenthood and not funding the health care bill. i think this is a worthy compromise, i'm glad to support

it. i do want to note my grave concern with the rule and the rather ambiguous position we find ourselves in with respect to the actions of senate. about 10 days ago the majority attempted to pass a bill where the senate would never have to act. now they want to say even if the house and the senate have both acted apparently the bill doesn't become law. maybe we should have put a few more education funds in for constitutional studies here because i think this is very unwise and frankly ambiguous. so i'm going to oppose the rule on the grounds that this very novel idea of giving the clerk of the house the instructions not to enroll a bill that's been passed by both house and senate i think is very troubling. having said that, i think that the underlying bill merits the support of both republicans and democrats and i will be voting yes. i yield back. the speaker pro tempore: the gentleman yields back the balance of his time.

does the gentleman from california continue to reserve? mr. dreier: madam speaker, i'll continue to reserve. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from colorado. mr. polis: thank you, madam speaker. i yield two minutes to the gentleman from texas, mr. doggett. the speaker pro tempore: the gentleman from texas is recognized for two minutes. mr. doggett: as one who voted for cutting some of president obama's spending requests last year and who has already voted three times this year to cut spending from the budget, i believe we do need to ferret out every bit of unnecessary spending, to demand greater efficiency and to seek common ground on securing our long-term financial future of our national debt. but this resolution is only a belated companion to the deal that tied a christmas bow around another tax cut for the wealthiest few in december. it represents another unbalanced approach to achieving balance in our budget. there is no shared sacrifice

here. and like that december bill, this concession literally sets up tomorrow's demand for adoption of the house republican budget, a pathway to less economic, educational and health care security. instead of asking for a dime from exxon mobil or other polluters, this deal makes severe cuts in the budget to assure us clean air and clean water. instead of asking for $1 from general electric or another of these giant corporations that won't pay their fair share of taxes this place the burden on hundreds of thousands of young americans who are trying to seek a future job in the united states. almost 1/4 of the budget is eliminated for youth bill, a program that provides vital education in employment skills to young people. and i've seen this up close, seeing the difference that our local youth works makes, in

trails constructed, in homes weatherized, in the vital employment and training skills provided with every energy efficient home that a foundation is laid for, a foundation is laid for the future of some enterprising young texan. and with another 100,000 young people at universities like texas state losing the counseling, academic instruction and tutoring -- can i have another 15 seconds mr. polis: i yield the gentleman another 15 seconds. mr. doggett: and encouragement from trio, that helps them achieve academic success. that's not balanced. fair and balanced, yes, i know it's a distorted slogan, but i think it could have real meaning for our budget. but this budget is balanced on our young people and our future. we need a budget that's fair. the speaker pro tempore: the gentleman from california continues to reserve. mr. dreier: madam speaker, i'll continue to reserve. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from colorado. mr. polis: madam speaker, i am proud to yield two minutes to the gentleman from vermont, a

former member of the rules committee, mr. welch. the speaker pro tempore: the gentleman from vermont is recognized for two minutes. mr. welch: i thank the gentleman. america's in a very dangerous place on this budget and it's not an unsolvable problem. we can get from where we are to where we need to be and that is fiscal balance if we put everything on the table and have a balanced approach. if instead we limit our consideration to essentially 12% of the budget, the so-called domestic discretionary, things like low income heating assistance, the small business administration, scholarships for our kids wanting to go to college, scientific research, if we limit our attention to that 12% of the budget, even if we cut that entire 12%, we would have trillion-dollar deficits for as long as the eye can see. it won't work. there's a design defect here. we've aggravated it with the deal that was made to extend the tax cuts at the high end.

when we were here in our special session after the last election, that's $750 billion that we have to borrow in order to pay for that's tax cuts for the top 2%. we have to put everything on the table. it has to include the pentagon, it has to include revenues, it has to include eliminating wasteful and unproductive nonjob-general reating tax -- nonjob-generating tax expenditures. has to include eliminating the ethanol subsidy, something that was promolted by the member from oklahoma, mr. sullivan. we put everything on the table, we can get from where we are to where we need to be. one thing we also cannot do is start playing budgetary hostage taking and there is looming ahead of us the question of whether we will raise the debt ceiling or use that as a leverage point in some -- as some are suggesting. this is not a leverage point, it's a moral obligation.

in the eight years in the clinton administration when he hand the keys over to the new president, mr. bush, there was a projected $5.7 trillion deficit and i yield back. thank you. the speaker pro tempore: the gentleman from colorado. mr. polis: i'm prepared to close. mr. dreier: then the gentleman go aed head and close and i'll do the same. the speaker pro tempore: the gentleman from colorado. mr. polis: thank you, madam speaker. i again want to bring it back to the hypothetical american family, small business we're talking about. here's the $1.399 trillion figure is boggling to most people. so lob off that zero and say, i'm a small business, i lost $139,000 this next year. let me tell you, is losing $137,000 the next year a step toward solvency or a step towards bankruptcy? i would submit, madam chair, ask any small business man in america or small business woman, losing $137,000 instead of

$139,000 is a step towards bankruptcy. just like that family we in the united states congress, we in this country, need to come together and make hard choices about where to find additional income, where to cut expenditures, how to get this budget out of red and into the black. that's the difference between where the democrats stand and the proposal of our friends on the other side. and another difference, a democratic president is actual -- has actually balanced a budget. that's a claim that the other side can't make for more than a generation. it's clear that the republicans are not serious about the deficit. if they were this would be a different bill. again, this is what we're talking about. taking our nation another step down the road toward fiscal insolvency and leaving a legacy of debt for the next generation. rather than holding the line on

spending, the majority is feeding the beast. and yet what do the republicans cut rather than rooting out waste at pentagon? they cut $1.6 billion from the e.p.a.'s effort to protect public health and keep our air and water safe. $950 million from community development block grants to strengthen neighborhoods and create jobs. $815 million from fema grants that help communities prepare for disasters. $10 million to keep our food safe. when you look at the winners and losers in this budget, it becomes clear what the majority party does and does not value. and they clearly do not mind leaving the next generation a legacy of deficits and debt. what we're doing in this continuing resolution is increasing the favorite government spending of the majority party, running up the deficit, continuing big tax cuts for special interests while slashing the effort to educate our children, ensure access to health care, keep our air and water clean, oh, and while they're at it, taking away a woman's right to choose. this is where we could be by working together, democrats and

republicans. this process, this rule and this bill are not examples of working together to solve our budget crisis. we can do better, we must do better to save america from bankruptcy. we must do better from sound and fury signifying nothing. we need to work together to make the cuts we need to make, to increase the revenues we need to increase and to examine our entitlement programs, to put our nation on proper fiscal footing for the next generation and remove the mounting burden of debt that faces the next generation of americans. i don't see how anyone should argue that somehow reducing again at the family level $139,000 loss to $137,000 loss while it might be a fine thing to do, leaves that family in every bit as dangerous and precarious a fiscal situation as they were before. ask any small business man or small business woman in this

country. and after passing this continuing resolution and keeping our government in business another year or just punting further down the field about making cuts we all know we need to make to balance the budget, return to a surplus and help remove the next generation of americans from the legacy of debt that is threatening to crush them. i urge a no vote on the rule and i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. the gentleman from california. mr. dreier: madam speaker, i yield myself the balance of the time. the speaker pro tempore: the gentleman is recognized. mr. dreier: madam speaker, according to the schedule in about nine minutes the president of the united states at george washington university is scheduled to give a very important address in which he's going to talk about fiscal responsibility, the need to bring about spending cuts and all and how to get our economy growing. i want to congratulate the president, i want to congratulate the president for coming to this position and obviously it's much different

than what we've gone through so far. as i said earlier, we've had an 82% increase in nondefense discretionary spending, the president proposed a budget that has deficits in excess of $1.5 trillion and would exacerbate the debt. he came out a few weeks ago and proposed a freeze in spending. we know that if we'd not done what we're about to vote on here with this rule making or a vote that will take place tomorrow we would see an increase of spending of $78.5 billion, $78.5 billion more in spending if we had not taken the action that this house in a bipartisan way is about to take. but the reason i want to congratulate the president is that i've just taken a look at the early reports of what what he's about to say in this -- of what he's about to say in this speech and he does call for us to look at the issue of entitlements, he specifically

says social security, not medicare or medicaid, but he talks about social security. but i believe that is again a first step towards what i believe is absolutely essential and that is for us in a bipartisan way to tackle the issue of entitlement spending. as mr. dicks said in the rules committee yesterday, that's 2/3 of the spending. we know that entitlement spending is something that needs to be addressed and there is bipartisan recognition that we need to get our fiscal house in order. and, madam speaker, what we have before us is a measure that i don't like. i don't like it. i don't believe that it does enough to reduce the size and scope and reach of government. i believe that we need to do more. but we have to remember that we've got to take that first step. now, last november 2 the american people sent a very loud and powerful message to

washington, d.c. there are 96 newly elected members of this house, nine of them happen to be democrats, 87 of them are republicans. now, madam speaker, i think it's important for us to recognize that that's a pretty powerful message. they were saying, end the nonsense, bring an end to this dramatic expansion of government and that's exactly what we're doing with this first step. now, margaret thatcher, the great former prime minister of great britain, famously said, first you have to win the argument, then you win the vote. i believe that we've won the argument, madam speaker, because the message has come through. the message has come through that we are in fact going to have to get our fiscal house in order if we're going to ensure

the strength and the preeminence of the greatest nation the world has ever known. and so, madam speaker, i'm going to urge my colleagues to support this rule and tomorrow we'll have a vote on the continuing resolution itself and then we will begin, tomorrow after we've had that vote, we will begin to debate the budget which is going to be far-reaching, it's going to be difficult but it is clearly the right thing for us to do and i will say again, madam speaker, that i do hope that on these issues we will be able to continue to work together in a bipartisan way to solve our nation's problems. and with th

>> will also be working on a budget next year. you can watch all the house proceedings on line. >> it asks students to consider washington d.c. through their blends. it is just an issue that help them understand the role of the federal government. >> most people take them for granted. what happens if someone takes it away? millions of families have lost their homes due to one problem. home foreclosure. home foreclosures could have been to any house the matter

what shape or size. he may be wondering what it is. >> it is when a party cannot repay the loan. >> the bankers filing petition to foreclose on the property. after that, it has to approve the holder that it is closing. the personal go to court. the the bank will issue an order of foreclosure. the reason it is alarmingly high is an october 2010 they fall for -- a fall for it. the numbers continue to add on. >>. people do not want to add on.

they affected on the family. the houses taken over. how have foreclosures affected the economy? is the fact that home values have gone down. >> about how quickly are foreclosed homes sold? >> the average is about 120 days for your home sales. i would say about 60 days would be normal. there are job losses and an

inability to do things. just to name a few. another problem homeowners are facing is anxiety. this is when banks signed foreclosure notices without evaluating them first. the foreclosures are put off until the guilty parties -- they are now looking over their cases more clearly. meanwhile, some people do not agree with that. >> we are waiting to hear what the regulators say, "here is what we have done to sanction this behavior. we saw it, we acted, and we did this." i did not hear that. at least i should hear them say,

"here are the kinds of sanctions that we can do it servicers in this behavior "i did not hear that either. what i heard was, "we are investigating it. we are on it. we have to know more in a month or so and then we are going to do something." however, the federal government understands that this is not the only problem homeowners are facing. >> the american dream is being tested by a home mortgage crisis that not only threatens the sit -- the stability of our economy, but the stability of families and neighborhoods. the crisis is striking at the heart of the middle-class. the homes in which we invest our savings and raise our families. >> president obama has been thinking of ways to help struggling homeowners since the day he took office. >> we have been charged to lead.

we'll have to confront some difficult decisions. as president, i am committed to doing my part. >> he is thinking of new ideas to help struggling homeowners. the most recent program is called the home of portable modification program. >> we decided to help people to lower their payments to help them maintain their homes and not have to move out. but with the goal. >> this program addresses many problems. with this plan, house tours can determine which mortgages to help them what kind of help they can use. the counselors will look at many things. the federal government also created a program called home of portable foreclosure alternative

program. the reason h.a.f.a was started is because many people needed the program to stall foreclosures. help is still in action. with billions of dollars put into the program, many struggling homeowners already had a broader looking future ahead. who knows? they may even have a place called home again. >> go to studentcam.org to see the winning videos. span,s coming up on c- president obama presents his deficit reduction plan. that is followed by a reaction from house republican leaders. the house rules committee begins work on the 2012 budget.

on tomorrow's washington journal, massachusetts governor will look at the federal budget with congressman kevin brady. the president of the american hospital association. rocjard i,bdemstpcl/ -- richard umbdenstock. >> a few months ago i was able to sign a tax cut for american families. now, the same corporation has made possible for us to move forward with the biggest annual spending cut in history. >> watch all the events from the current spending debate and the debate about next year by the budget as well. what's online with pcs and video library. search, watch, and share. it is what you want, when you want.

throughout the month of april we will feature the top winners of this year's studentcam competition. the theme is "washington d.c. through my glance appear "what's the winning videos every morning at 650 eastern just before washington journal. during the program, meet the students who created them. stream and the winning videos any time on line at studentcam.org. president obama presented is deficit reduction plan yesterday in a speech at george washington university. his proposal has $4 trillion in deficit cuts over the next 12 years. among those in attendance, secretary jim geithner, and paul ryan. this is 45 minutes. [applause]

thank you very much. please have a seat. >> good afternoon. it's great to be back at gw. i want you to know that one of the reasons i kept the government open was so i could be here today with all of you. i wanted to make sure you had one more excuse to skip class. [laughter] you're welcome. [laughter] i want to give a special thanks to the president of george washington university. there he is right there. [applause] we have a lot of distinguished guest here. a couple of people i want to acknowledge. first of all, my outstanding vice president, joe biden is here. [applause]

our secretary of the treasury, timothy geithner is in the house. jack wu from the office of management and budget. [applause] gene sperling, chair of the national economic council is here. [applause] members of our bipartisan fiscal condition are here in trading -- including erskine bowles and alan simpson. [applause] we have a number of members of congress here today. i am grateful for all of you taking the time to attend. of course, what we've been debating here in washington for the last few weeks will affect your lives in ways that are potentially profound. this debate over budgets and deficits is about more than

just numbers on a page, more than just cutting and spending. it's about the kind of future we want. it's about the kind of country we believe in. and that's what i want to talk about today. from our first days as a nation, we have put our faith in free markets and free enterprise as the engine of america's wealth and prosperity. more than citizens of any other country, we are rugged individualists, a self-reliant people with a healthy skepticism of too much government. but there has always been another thread running throughout our history -- a belief that we are all connected, and that there are some things we can only do together, as a nation.

we believe, in the words of our first republican president, abraham lincoln, that through government, we should do together what we cannot do as well for ourselves. and so we've built a strong military to keep us secure, and public schools and universities to educate our citizens. we've laid down railroads and highways to facilitate travel and commerce. we've supported the work of scientists and researchers whose discoveries have saved lives, unleashed repeated technological revolutions, and led to countless new jobs and entire industries. each of us has benefitted from these investments, and we are a more prosperous country as a result. part of this american belief that we are all connected also expresses itself in a conviction that each one of us deserves some basic measure of security.

we recognize that no matter how responsibly we live our lives, hard times or bad luck, a crippling illness or a layoff, may strike any one of us. "there but for the grace of god go i," we say to ourselves, and so we contribute to programs like medicare and social security, which guarantee us health care and a measure of basic income after a lifetime of hard work -- unemployment insurance, which protects us against unexpected job loss, and medicaid, which provides care for millions of seniors in nursing homes, poor children, and those with disabilities. we are a better country because of these commitments. i'll go further -- we would not be a great country without those commitments.

for much of the last century, our nation found a way to afford these investments and priorities with the taxes paid by its citizens. as a country that values fairness, wealthier individuals have traditionally born a greater share of this burden than the middle class or those less fortunate. this is not because we begrudge those who've done well -- we rightly celebrate their success. rather, it is a basic reflection of our belief that those who have benefitted most from our way of life can afford to give a bit more back. moreover, this belief has not hindered the success of those at the top of the income scale, who continue to do better and better with each passing year.

now, at certain times -- particularly during periods of war or recession -- our nation has had to borrow money to pay for some of our priorities. and as most families understand, a little credit card debt isn't going to hurt if it's temporary. but as far back as the 1980s, america started amassing debt at more alarming levels, and our leaders began to realize that a larger challenge was on the horizon. they knew that eventually, the baby boom generation would retire, which meant a much bigger portion of our citizens would be relying on programs like medicare, social security, and possibly medicaid. like parents with young children who know they have to start saving for the college years, america had to start borrowing less and saving more to prepare for the retirement of an entire generation. to meet this challenge, our leaders came together three times during the 1990s to reduce our nation's deficit.

they forged historic agreements that required tough decisions made by the first president bush and president clinton, by democratic congresses and a republican congress. all three agreements asked for shared responsibility and shared sacrifice, but they largely protected the middle class, our commitments to seniors, and key investments in our future. as a result of these bipartisan efforts, america's finances were in great shape by the year 2000. we went from deficit to surplus. america was actually on track to becoming completely debt- free, and we were prepared for the retirement of the baby boomers.

but after democrats and republicans committed to fiscal discipline during the 1990s, we lost our way in the decade that followed. we increased spending dramatically for two wars and an expensive prescription drug program -- but we didn't pay for any of this new spending. instead, we made the problem worse with trillions of dollars in unpaid-for tax cuts -- tax cuts that went to every millionaire and billionaire in the country -- tax cuts that will force us to borrow an average of $500 billion every year over the next decade. to give you an idea of how much damage this caused to our national checkbook, consider this: in the last decade, if we had simply found a way to pay for the tax cuts and the prescription drug benefit, our deficit would currently be at low historical levels in the coming years. of course, that's not what

happened. and so, by the time i took office, we once again found ourselves deeply in debt and unprepared for a baby boom retirement that is now starting to take place. when i took office, our projected deficit was more than $1 trillion. on top of that, we faced a terrible financial crisis and a recession that, like most recessions, led us to temporarily borrow even more. in this case, we took a series of emergency steps that saved millions of jobs, kept credit flowing, and provided working families extra money in their pockets. it was the right thing to do, but these steps were expensive, and added to our deficits in the short term. so that's how our fiscal challenge was created. this is how we got here. and now that our economic recovery is gaining strength, democrats and republicans must come together and restore the

fiscal responsibility that served us so well in the 1990s. we have to live within our means, reduce our deficit, and get back on a path that will allow us to pay down our debt. and we have to do it in a way that protects the recovery, and protects the investments we need to grow, create jobs, and win the future. now, before i get into how we can achieve this goal, some of you might be wondering, "why is this so important? why does this matter to me?" here's why. even after our economy recovers, our government will still be on track to spend more money than it takes in throughout this decade and beyond. that means we'll have to keep

borrowing more from countries like china. and that means more of your tax dollars will go toward paying off the interest on all the loans we keep taking out. by the end of this decade, the interest we owe on our debt could rise to nearly $1 trillion. just the interest payments. then, as the baby boomers start to retire and health care costs continue to rise, the situation will get even worse. by 2025, the amount of taxes we currently pay will only be enough to finance our health care programs, social security, and the interest we owe on our debt. that's it. every other national priority -- education, transportation, even national security -- will have to be paid for with borrowed money.

ultimately, all this rising debt will cost us jobs and damage our economy. it will prevent us from making the investments we need to win the future. we won't be able to afford good schools, new research, or the repair of roads and bridges -- all the things that will create new jobs and businesses here in america. businesses will be less likely to invest and open up shop in a country that seems unwilling or unable to balance its books. and if our creditors start worrying that we may be unable to pay back our debts, it could drive up interest rates for everyone who borrows money -- making it harder for businesses to expand and hire, or families to take out a mortgage. the good news is, this doesn't have to be our future. this doesn't have to be the

country we leave to our children. we can solve this problem. we came together as democrats and republicans to meet this challenge before, and we can do it again. but that starts by being honest about what's causing our deficit. you see, most americans tend to dislike government spending in the abstract, but they like the stuff it buys. most of us, regardless of party affiliation, believe that we should have a strong military and a strong defense. most americans believe we should invest in education and medical research. most americans think we should protect commitments like social security and medicare. and without even looking at a poll, my finely honed political skills tell me that almost no one believes they should be paying higher taxes. because all this spending is

popular with both republicans and democrats alike, and because nobody wants to pay higher taxes, politicians are often eager to feed the impression that solving the problem is just a matter of eliminating waste and abuse -- that tackling the deficit issue won't require tough choices. or they suggest that we can somehow close our entire deficit by eliminating things like foreign aid, even though foreign aid makes up about 1% of our entire budget. so here's the truth. around two-thirds of our budget is spent on medicare, medicaid, social security, and national security. programs like unemployment

insurance, student loans, veterans' benefits, and tax credits for working families take up another 20%. what's left, after interest on the debt, is just 12% for everything else. that's 12% for all of our other national priorities like education and clean energy, medical research and transportation, food safety and keeping our air and water clean. all of that accounts for 12% of our budget. up until now, the cuts proposed by a lot of folks in washington have focused almost exclusively on that 12%. but cuts to that 12% alone won't solve the problem. so any serious plan to tackle

our deficit will require us to put everything on the table, and take on excess spending wherever it exists in the budget. a serious plan doesn't require us to balance our budget overnight -- in fact, economists think that with the economy just starting to grow again, we will need a phased-in approach -- but it does require tough decisions and support from leaders in both parties. and above all, it will require us to choose a vision of the america we want to see five and ten and twenty years down the road. one vision has been championed by republicans in the house of representatives and embraced by several of their party's presidential candidates. it's a plan that aims to reduce

our deficit by $4 trillion over the next ten years, and one that addresses the challenge of medicare and medicaid in the years after that. those are both worthy goals for us to achieve. but the way this plan achieves those goals would lead to a fundamentally different america than the one we've known throughout most of our history. i think it would be different than what we have known throughout our history. a 70% cut to clean energy. a 25% cut in education. a 30% cut in transportation. cuts in college pell grants that will grow to more than $1,000 per year. that's what they're proposing.

these aren't the kind of cuts you make when you're trying to get rid of some waste or find extra savings in the budget. these aren't the kind of cuts that republicans and democrats on the fiscal commission proposed. these are the kind of cuts that tell us we can't afford the america we believe in. and they paint a vision of our future that's deeply pessimistic. it's a vision that says if our roads crumble and our bridges collapse, we can't afford to fix them. if there are bright young americans who have the drive and the will but not the money to go to college, we can't afford to send them. go to china and you'll see businesses opening research labs and solar facilities. south korean children are outpacing our kids in math and science. brazil is investing billions in

new infrastructure and can run half their cars not on high- priced gasoline, but biofuels. and yet, we are presented with a vision that says the united states of america -- the greatest nation on earth -- can't afford any of this. it's a vision that says america can't afford to keep the promise we've made to care for our seniors. it says that ten years from now, if you're a 65 year old who's eligible for medicare, you should have to pay nearly $6,400 more than you would today. it says instead of guaranteed health care, you will get a voucher. and if that voucher isn't worth enough to buy insurance, tough luck -- you're on your own. put simply, it ends medicare as we know it.

this is a vision that says up to 50 million americans have to lose their health insurance in order for us to reduce the deficit. and who are those 50 million americans? many are someone's grandparents who wouldn't be able afford nursing home care without medicaid. many are poor children. some are middle-class families who have children with autism or down's syndrome. some are kids with disabilities so severe that they require 24- hour care. these are the americans we'd be telling to fend for themselves. worst of all, this is a vision that says even though america can't afford to invest in education or clean energy, even

though we can't afford to care for seniors and poor children, we can somehow afford more than $1 trillion in new tax breaks for the wealthy. think about it. in the last decade, the average income of the bottom 90% of all working americans actually declined. the top 1% saw their income rise by an average of more than a quarter of a million dollars each. and that's who needs to pay less taxes? they want to give people like me a two hundred thousand dollar tax cut that's paid for by asking thirty three seniors to each pay six thousand dollars more in health costs?

that's not right, and it's not going to happen as long as i'm president. [applause] the fact is, their vision is less about reducing the deficit than it is about changing the basic social compact in america. as ronald reagan's own budget director said, there's nothing "serious" or "courageous" about this plan. there's nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires. there's nothing courageous about asking for sacrifice from those who can least afford it and don't have any clout on capitol hill. and this is not a vision of the america i know. the america i know is generous

and compassionate, a land of opportunity and optimism. we take responsibility for ourselves and each other, for the country we want and the future we share. we are the nation that built a railroad across a continent and brought light to communities shrouded in darkness. we sent a generation to college on the gi bill and saved millions of seniors from poverty with social security and medicare. we have led the world in scientific research and technological breakthroughs that have transformed millions of lives. this is who we are. this is the america i know. we don't have to choose between a future of spiraling debt and one where we forfeit investments in our people and our country. to meet our fiscal challenge, we will need to make reforms. we will all need to make sacrifices. but we do not have to sacrifice the america we believe in.

and as long as i'm president, we won't. today, i'm proposing a more balanced approach to achieve $4 trillion in deficit reduction over twelve years. it's an approach that borrows from the recommendations of the bipartisan fiscal commission i appointed last year, and builds on the roughly $1 trillion in deficit reduction i already proposed in my 2012 budget. it's an approach that puts every kind of spending on the table, but one that protects the middle-class, our promise to seniors, and our investments in the future. the first step in our approach is to keep annual domestic spending low by building on the savings that both parties agreed to last week -- a step that will save us about $750 billion over twelve years.

we will make the tough cuts necessary to achieve these savings, including in programs i care about, but i will not sacrifice the core investments we need to grow and create jobs. we'll invest in medical research and clean energy technology. we'll invest in new roads and airports and broadband access. we will invest in education and job training. we will do what we need to compete and we will win the future. the second step in our approach is to find additional savings in our defense budget. as commander-in-chief, i have no greater responsibility than protecting our national security, and i will never accept cuts that compromise our ability to defend our homeland or america's interests around the world. but as the chairman of the joint chiefs, admiral mullen, has said, the greatest long-

term threat to america's national security is america's debt. just as we must find more savings in domestic programs, we must do the same in defense. over the last two years, secretary gates has courageously taken on wasteful spending, saving $400 billion in current and future spending. i believe we can do that again. we need to not only eliminate waste and improve efficiency and effectiveness, but conduct a fundamental review of america's missions, capabilities, and our role in a changing world. i intend to work with secretary gates and the joint chiefs on this review, and i will make specific decisions about spending after it's complete. the third step in our approach is to further reduce health

care spending in our budget. here, the difference with the house republican plan could not be clearer: their plan lowers the government's health care bills by asking seniors and poor families to pay them instead. our approach lowers the government's health care bills by reducing the cost of health care itself. already, the reforms we passed in the health care law will reduce our deficit by $1 trillion. my approach would build on these reforms. we will reduce wasteful subsidies and erroneous payments. we will cut spending on prescription drugs by using medicare's purchasing power to drive greater efficiency and speed generic brands of medicine onto the market. we will work with governors of both parties to demand more efficiency and accountability

from medicaid. we will change the way we pay for health care -- not by procedure or the number of days spent in a hospital, but with new incentives for doctors and hospitals to prevent injuries and improve results. and we will slow the growth of medicare costs by strengthening an independent commission of doctors, nurses, medical experts and consumers who will look at all the evidence and recommend the best ways to reduce unnecessary spending while protecting access to the services seniors need. now, we believe the reforms we've proposed to strengthen medicare and medicaid will enable us to keep these commitments to our citizens while saving us $500 billion by 2023, and an additional one trillion dollars in the decade after that. and if we're wrong, and medicare costs rise faster than we expect, this approach will give the independent commission the authority to make additional savings by further

improving medicare. but let me be absolutely clear: i will preserve these health care programs as a promise we make to each other in this society. i will not allow medicare to become a voucher program that leaves seniors at the mercy of the insurance industry, with a shrinking benefit to pay for rising costs. i will not tell families with children who have disabilities that they have to fend for themselves. we will reform these programs, but we will not abandon the fundamental commitment this country has kept for generations. that includes, by the way, our commitment to social security. while social security is not the cause of our deficit, it faces real long-term challenges in a country that is growing older. as i said in the state of the union, both parties should work together now to strengthen social security for future generations.

but we must do it without putting at risk current retirees, the most vulnerable, or people with disabilities, without slashing benefits for future generations, and without subjecting americans' guaranteed retirement income to the whims of the stock market. the fourth step in our approach is to reduce spending in the tax code. in december, i agreed to extend the tax cuts for the wealthiest americans because it was the only way i could prevent a tax hike on middle-class americans. but we cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society. and i refuse to renew them again. beyond that, the tax code is also loaded up with spending on things like itemized deductions. and while i agree with the goals of many of these

deductions, like homeownership or charitable giving, we cannot ignore the fact that they provide millionaires an average tax break of $75,000 while doing nothing for the typical middle-class family that doesn't itemize. my budget calls for limiting itemized deductions for the wealthiest 2% of americans -- a reform that would reduce the deficit by $320 billion over ten years. but to reduce the deficit, i believe we should go further. that's why i'm calling on congress to reform our individual tax code so that it is fair and simple -- so that the amount of taxes you pay isn't determined by what kind of accountant you can afford. i believe reform should protect the middle class, promote economic growth, and build on the fiscal commission's model of reducing tax expenditures so

that there is enough savings to both lower rates and lower the deficit. and as i called for in the state of the union, we should reform our corporate tax code as well, to make our businesses and our economy more competitive. this is my approach to reduce the deficit by $4 trillion over the next twelve years. it's an approach that achieves about $2 trillion in spending cuts across the budget. it will lower our interest payments on the debt by $1 trillion. it calls for tax reform to cut about $1 trillion in spending from the tax code. and it achieves these goals while protecting the middle class, our commitment to seniors, and our investments in the future. in the coming years, if the recovery speeds up and our economy grows faster than our current projections, we can make even greater progress than

i have pledged here. but just to hold washington -- and me -- accountable and make sure that the debt burden continues to decline, my plan includes a debt failsafe. if, by 2014, our debt is not projected to fall as a share of the economy -- or if congress has failed to act -- my plan will require us to come together and make up the additional savings with more spending cuts and more spending reductions in the tax code. that should be an incentive for us to act boldly now, instead of kicking our problems further down the road. so this is our vision for america -- a vision where we live within our means while still investing in our future,

where everyone makes sacrifices but no one bears all the burden, where we provide a basic measure of security for our citizens and rising opportunity for our children. of course, there will be those who disagree with my approach. some will argue we shouldn't even consider raising taxes, even if only on the wealthiest americans. it's just an article of faith for them. i say that at a time when the tax burden on the wealthy is at its lowest level in half a century, the most fortunate among us can afford to pay a little more. i don't need another tax cut.

warren buffett doesn't need another tax cut. not if we have to pay for it by making seniors pay more for medicare. or by cutting kids from head start. or by taking away college scholarships that i wouldn't be here without. that some of you wouldn't be here without. and i believe that most wealthy americans would agree with me. they want to give back to the country that's done so much for them. washington just hasn't asked them to. others will say that we shouldn't even talk about cutting spending until the economy is fully recovered. these are mostly folks in my party. i'm sympathetic to this view, which is one of the reasons i supported the payroll tax cuts

we passed in december. it's also why we have to use a scalpel and not a machete to reduce the deficit -- so that we can keep making the investments that create jobs. but doing nothing on the deficit is just not an option. our debt has grown so large that we could do real damage to the economy if we don't begin a process now to get our fiscal house in order. finally, there are those who believe we shouldn't make any reforms to medicare, medicaid, or social security out of a fear that any talk of change to these programs will usher in the sort of radical steps that house republicans have proposed. i understand these fears. but i guarantee that if we don't make any changes at all, we won't be able to keep our commitments to a retiring generation that will live longer and face higher health care costs than those who came

before. indeed, to those in my own party, i say that if we truly believe in a progressive vision of our society, we have the obligation to prove that we can afford our commitments. if we believe that government can make a difference in people's lives, we have the obligation to prove that it works -- by making government smarter, leaner and more effective. of course, there are those who will simply say that there's no way we can come together and agree on a solution to this challenge. they'll say the politics of this city are just too broken, that the choices are just too hard, that the parties are just too far apart. and after a few years in this job, i certainly have some sympathy for this view.

[laughter] but i also know that we've come together and met big challenges before. ronald reagan and tip o'neill came together to save social security for future generations. the first president bush and a democratic congress came together to reduce the deficit. president clinton and a republican congress battled each other ferociously and still found a way to balance the budget. in the last few months, both parties have come together to pass historic tax relief and spending cuts. and i know there are republicans and democrats in congress who want to see a balanced approach to deficit reduction. i believe we can and must come together again.

we may disagree on our visions, but i truly believe they want to do the right thing. this morning, i met with democratic and republican leaders in congress to discuss the approach i laid out today. and in early may, the vice president will begin regular meetings with leaders in both parties with the aim of reaching a final agreement on a plan to reduce the deficit by the end of june. i don't expect the details in any final agreement to look exactly like the approach i laid out today. i'm eager to hear other ideas from all ends of the political spectrum. and though i'm sure the criticism of what i've said here today will be fierce in some quarters, and my critique of the house republican approach has been strong, americans

deserve and will demand that we all bridge our differences, and find common ground. this larger debate we're having, about the size and role of government, has been with us since our founding days. and during moments of great challenge and change, like the one we're living through now, the debate gets sharper and more vigorous. that's a good thing. as a country that prizes both our individual freedom and our obligations to one another, this is one of the most important debates we can have. but no matter what we argue or where we stand, we've always held certain beliefs as americans.

we believe that in order to preserve our own freedoms and pursue our own happiness, we can't just think about ourselves. we have to think about the country that made those liberties possible. we have to think about our fellow citizens with whom we share a community. and we have to think about what's required to preserve the american dream for future generations. this sense of responsibility -- to each other and to our country -- this isn't a partisan feeling. it isn't a democratic or republican idea. it's patriotism. the other day i received a letter from a man in florida. he started off by telling me he didn't vote for me and he hasn't always agreed with me.

but even though he's worried about our economy and the state of our politics, he said, "i still believe. i believe in that great country that my grandfather told me about. i believe that somewhere lost in this quagmire of petty bickering on every news station, the 'american dream' is still alive we need to use our dollars here rebuilding, refurbishing and restoring all that our ancestors struggled to create and maintainwe as a people must do this together, no matter the color of the state one comes from or the side of the aisle one might sit on." i still believe as well. and i know that if we can come

together, and uphold our responsibilities to one another and to this larger enterprise that is america, we will keep the dream of our founding alive in our time, and pass on to our children the country we believe in. thank you, god bless you, and may god bless the united states of america. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> house republicans reacted to the president's budget speech with a press converts on capitol hill. we will hear from budget committee chairman paul ryan and ways and means chairman dave camp. this is 20 minutes.

>> good afternoon, everyone. late yesterday at myself, chairman ryan, and chairman camp were invited to have a front row seat for the president's review of his budget. he spent approximately half an hour blaming everyone for the nation but treat this goal was except himself, attacking the prosperity budget, and said think a new standard for class warfare rhetoric. i thought to myself, i missed lunch for this? although i was honored to receive the invitation, it was something i could have watched from my office. this was not a speech designed it for america to win the future. this was a speech designed for

the president to attempt to win reelection. this was a speech that prioritizes the next election over the next generation. it was a speech that was heavy on aspirational goals and exceedingly light on specific proposals. those who were present deserved comments. at a time when millions of our countrymen to remain unemployed, the president, again, a proposed tax increases on job creators. if i had an opportunity, i would say, "mr. president, how do you expect to help the job seeker by, yet again, punishing the job creator?" i know of no nation that has ever attacked its way into economic prosperity. it is spending that is the disease. i guess i am at least part and

that the president acknowledges that medicare is on an unsustainable path. however, putting price controls and rationing on steroids is not the answer. the president passes on social security, claiming that it does not appear to be in any fiscal threat. tell that to all the americans who are scheduled to receive a 22% automatic benefit in the years to come. so, again, it was very light on specific proposals. i will mention one more and then yelled to my colleagues. the president fails to include somewhere between 75% sign and 80% in his failsafe.

that can only lead to a completely gutting national defence, or adding implicit tax increases on those who are already explicit in his plan. under the leadership of our budget chairman, paul ryan, republicans had a different idea. this budget will put america on the fiscally sustainable path to help create jobs, to ensure that our social safety net, which even the president implicitly admits is going broke, is safe for future generations. our path to prosperity is about saving the american dream for the next generation, ensuring that our children and greater opportunities than we have. now, i would like to yield to the republican leader. >> good afternoon. i had an opportunity today to go to the white house to speak to

john boehner and the other leaders of the house of the senate. we had a very serious discussion with the president. the request was for all of us to be mindful of the challenges that we face and to have an adult conversation to try to come to resolution. what happened after that is the president goes and delivers his speech in which the only concrete proposal that he proposed was raising taxes. that solution falls far short of dealing with the kind of crisis we are facing as far as the debt is concerned. as was just said, raising taxes is not what we need right now two days before tax days we're trying to get job creators back into the game. we are serious. we'll be defined budget plan on before. we have laid out our vision in

specifics as how to manage it down this debt and get our economy back on track and prepare a future for our kids. that is what we are about. we are serious. we care about these entitlement programs. we are trying to say that you have to have a safety net for those in need it, but not for those who do not. we've spoken to the specifics, mr. president. we are serious. where are you? >> i am very disappointed in the president. i was excited when we got invited to attend his speech today. i thought the president's invitation was an olive branch. instead, we got a speech that was excessively partisan, dramatically inaccurate, and a hopelessly and adequate to addressing our country's

pressing fiscal challenges. what we heard today was not leadership from our commander in chief. what we heard today was a political broadside from our campaigner in cheek. i guess there is no coincidence that last week when the president lost his reelection campaign is when we lost our effort to get our debt and deficit under control and get the economy growing. last year, the absence of the fiscal budget, the president created and -- create a commission. he ignored all of its recommendations. now, he was to delegate leadership again to a new commission. how are we to expect results? the measurements of success of this new commission or lower than the measurement of success for the last commission that ended a few months ago. we need leadership. we do not need a doubling down on the failed politics of the past. this is very sad and very

unfortunate. rather than building bridges, he is poisoning wells. by failing to confront the most predictable economic crisis are -- i get our nation's history, his policies are committing us to a diminished future. we are looking for bipartisan solutions, not partisan rhetoric. when the president is ready to get serious about it, we will be here working. exploiting people's emotions of fear, envy, and anxiety is not helpful. it is not change. it is partisanship. we do not need partisanship. we do not need demagoguery. we need solutions. we do not need to keep ;unting to other people to make tough decisions. if we do not make tough decisions today, our children will have to make much tougher decisions do more.

i am sincerely disappointed that the president, at a moment when we are putting ideas on the table, trying to engage in a thoughtful dialogue to fix our fiscal problems, decides to pour on the campaign rhetoric, logic his reelection, and passed partisan broadsides against us, and making get that much harder for the two parties to come together to get things done. >> thank you. i agree. much of the speech was rhetoric that was unnecessary, and helpful, unproductive, and was far too partisan. i think it is helpful that the president admitted his first budget did not go far enough. clearly it did not. there is one item of individual tax reform that the president put on the table, which is somethg