Opening Statement of U.S. Senator Chuck Grassley

Budget Conference Committee

Wednesday, October 30, 2013

I'm glad to be here to get to work with our House colleagues to reconcile our differences on the fiscal year 2014 budget resolution.  This is regular order.  This is how this process is meant to work.

Our country is on an unsustainable fiscal course, yet this is the first time since 2009 since we've worked together to reconcile a budget resolution.

This is just the first step of this conference process.  I'd like to make a simple request regarding process.  The people's business ought to be public.

We've got important and difficult matters before us.  The deliberations and deal-making shouldn't be done in the dead of night in a backroom with only a small handful of individuals.

To regain the trust of American people, we must demonstrate that we can work together to confront our fiscal challenges.  There is an enormous amount cynicism among the populace about Washington.

Part of that cynicism, I believe, comes from the fact that many of the recent budget deals have been concocted in a back office by a few leaders, and rank and file members were left to take it or leave it.  They weren't debated.  There was no deliberation.  And nearly no one had an opportunity beforehand to even read them.

This is a terrible way to govern.  It's part of the reason people don't trust Washington to do what's right.  We should use this budget conference to change that perception and hold our meetings in public, in the light of day.

The President and the Senate Democratic leadership have insisted upon a balanced approach to replace the sequester cuts.  This so-called balanced approach would include tax increases with some spending cuts.  The problem with this logic is simple.

The fiscal problems facing the federal government are not balanced.  The problem is not that we tax too little; it's that we spend too much.   The offer of a so-called balanced plan is wrongheaded.  The problems we face are caused by a one-sided problem - spending.

The Congressional Budget Office projects that by 2038, federal spending will be 26 percent of GDP, compared to the 40-year average of 20.5 percent.  Spending on health care entitlements and Social Security will double over the next 25 years.

As a result, deficits will continue to grow and the resulting debt will grow faster than GDP, a path which CBO says is ultimately unsustainable.  CBO's projection included revenue levels higher than the historical average.  There is the root of the problem --spending growth outpaces even the higher revenue.

The President talks a great deal about growing our economy, creating jobs and growing the middle class.  I don't believe we need to grow government in order to create jobs, to grow the economy or increase the prosperity of Americans.  A more prosperous America does not result from an ever larger, more intrusive government.

President Kennedy knew the virtue that wealth, left in the hands of entrepreneurial Americans, would create new jobs, spur economic growth and grow the economy.

President Kennedy stated in 1962, the tax system "exerts too heavy a drag on growth in peace time; that it siphons out of the private economy too large a share of personal and business purchasing power; that it reduces the financial incentives for personal effort, investment, and risk-taking."

Yet, the Senate budget, which I opposed, would increase taxes by $1 trillion.  President Obama got his tax increase in the fiscal cliff deal of January 2013.  We increased taxes on job creating Americans by $600 billion.  Now is the time to focus on the other side of the ledger–the spending side.

I remain cautious about plans to trade spending reductions that are in law as a result of the Budget Control Act, for the promise of spending cuts or entitlement reform at some point in the future.

I will not entertain a so-called balanced plan that punishes small businesses and job creators with higher taxes in exchange for minor entitlement reforms that do not change the deficit and debt trajectory of our country.

If we're going to reform our entitlement programs to ensure their viability for future generations, we should do just that.  Perhaps the proposals included in President Obama's budget could be a starting point, and should be up for consideration.

I'm aware that there is a great deal of angst surrounding the impending sequester cuts, particularly those to the Department of Defense.  The defense of our nation is one of the primary constitutional responsibilities of the federal government and we should not take it lightly.

However, there should be no illusion that the Department of Defense is immune from wasteful spending, fraud and mismanagement that costs taxpayer millions and billions of dollars.

I've spent a great deal of time and effort on oversight of DoD's accounting and audit practices. I can tell you from experience that there is absolutely no basis for anyone to believe that the Pentagon is spending every taxpayer dollar wisely without a penny to spare.  With DoD lacking even the most basic audit controls to detect and root out waste and fraud, opportunities for significant savings abound without even cutting a single program.

So, while I recognize the concerns about these Defense cuts, and I wish we had gone about it in a more thoughtful way.  We should seriously consider giving agency heads more flexibility in managing the sequester cuts.  But, I know firsthand that billions of dollars of taxpayer money at the Pentagon is lost to waste, mismanagement and negligence.

Q:        What are the next steps to resolve the budget impasse in Washington?

A:        The 16-day partial government shutdown ended with a deal to appoint a budget conference that includes 29 lawmakers from the U.S. Senate and House of Representatives.  The bicameral, bipartisan panel is tasked with reaching an agreement on government funding levels.  I was named to serve on the budget conference, which is operating under a December 13 deadline to issue its final recommendations to Congress.  The vote to reopen the government did not lock in policy changes to address the $17 trillion national debt.  Now the budget conference is working to create a blueprint for future revenue and spending levels.  The last budget conference took place more than four years ago in April 2009.

Q:        What priorities will you promote as a member of the budget conference?

A:        First, to restore credibility and fiscal integrity to one of Congress' primary constitutional responsibilities:  the power of the purse.  The United States is not only facing a debt crisis.  We are also facing a crisis in confidence by the American people in our institutions of government.  Lawmakers need to come together to put the federal budget and budgeting process back on track.  For too long, Washington has been riding the gravy train, refusing to turn the corner on deficit spending or put the brakes on the national debt.  The federal budget has been driven off the rails by overpromises and overspending.  A driving force behind the reckless fiscal path includes unsustainable entitlement spending that's creating long-term generational inequity. Consider the largest federal pension and health care entitlements, Social Security, Medicare and Medicaid that serve older Americans. As the historic demographic shift continues over the next two decades, reforms are needed not just for spending discipline but to save the programs themselves, programs that have become part of the social fabric of America.  Other federal entitlements, such as food stamps, unemployment benefits and disability payments, have seen dramatic growth as eligibility was expanded during the Obama administration.  Adding even more burden to the taxpaying public, new federal subsidies paid out under the Affordable Care Act also will add to the wealth redistribution formula that is reshaping the size, scope and influence of the government into the U.S. economy and its reach into the lives of Americans.  On the budget conference committee, I intend to drive a hard bargain on behalf of the taxpaying public with a simple, straightforward message:  Washington cannot tax, spend and borrow its way to prosperity.  To that end, I'll work to restore principles of good governance during the negotiations, including transparency, accountability and fiscal integrity.

Q:        What needs to happen to reach a budget agreement?

A:        A concurrent budget resolution requires majority approval by the conferees to advance for a final up-or-down vote by Congress.  The budget resolution does not require the President's signature.  Instead, it has the authority to set the spending and taxing levels by which lawmakers on the respective committees will allocate tax dollars that operate services and functions of the government.  It boils down to lawmakers reaching an agreement on taxes and spending.  I disagree with those who believe raising taxes is the solution to reducing deficits and paying down America's $17 trillion debt.  Remember, less is more.  Spending less and taxing less will do more good for the economy.  The key to America's prosperity is rooted in the genesis of our republic.  We are a nation of self-starters who believe in personal responsibility, wealth creation and upward mobility.  Generations of Americans have worked hard to lay claim to their piece of the American Dream.  A tax-hungry, spendthrift Uncle Sam puts that dream at risk.  Restoring long-term prosperity will require a bipartisan consensus for permanent solutions to strengthen public entitlement systems and enact job-creating reforms of the federal tax code.  So, in addition to laying the groundwork for spending reductions that shrink the deficit, the budget conference should take the high road and identify long-lasting solutions that steer us away from fiscal cliffs.  Restoring fiscal integrity is the best way to avoid defaulting on the full faith and credit of the United States.

Wednesday, October 30, 2013

Senator Chuck Grassley and Congressman Jeff Fortenberry today made the following statements before the first official meeting of the farm and food bill conference committee later today.  Grassley and Fortenberry authored provisions in the Senate and House bills to establish a farm payment cap of $250,000.  The Senate and House bills also tighten loopholes that have allowed some non-farmers to game the system.  In addition, the Government Accountability Office recently released a report outlining many of the current shortcomings of the eligibility rules for farm programs.  The report also says that the legislative language in the Senate and House passed farm bills would be an appropriate fix to the agency's findings.

Grassley and Fortenberry maintain that the farm payment provisions are nearly identical in the two bills, and should not be up for negotiation.

Grassley comment:

"Our reform is common-sense.  Not only does it end some of the most egregious abuses of the farm program and make sure that the farm program payments are going to those who need them most, but it saves money.  It's a win-win for everybody.   When 22 people are getting farm payments for the same farm, and 70 percent of the farm payments go to 10 percent of the biggest farms, we've got a problem.  Some members of the conference committee have already made clear of their intention to remove the reforms.  By removing the payment limits and the provisions to close loopholes, these members are only making the safety net more susceptible to criticism and vulnerable to elimination.  The safety net is important to a safe and affordable food supply for the country, and it would be short-sighted to allow such a parochial mindset to undermine an important and necessary policy."

Fortenberry comment:

"After many years of discussion, farm payment limitations reform finally has a chance to become law.  More robust payment limits help farm supports reach intended recipients and close loopholes. In this time of tight budgets, the need for this type of fair reform is even greater. With the opportunity for new farm policy under negotiation between the House and Senate, payment limits should remain a key piece of the overall package. It is my hope that this important provision will carry forward into the final Farm Bill."

Specifics of the payment limits provisions:

• The bills establish a per farm cap of $50,000 on all commodity program benefits, except those associated with the marketing loan program (loan deficiency payments and marketing loan gains), which would be capped at $75,000.  Thus the combined limit would be $125,000, or, for married couples, $250,000.  The $50,000 cap would apply to whatever type of program is developed as part of the new farm and food bill.

• The bills would define clearly the scope of people who are able to qualify as actively engaged by only providing management for the farming operation.  The bill will allow one off-farm manager, but only one.  Landowners who share rent land to an actively-engaged producer remain exempt from the "actively engaged" rules provided their payments are commensurate to their risk in the crop produced.

The Muscatine Art Center will open its new exhibition, The Art of Living Well, on Thursday, November 7^th with a reception from 5 to 7 p.m. The Art of Living Well is an opportunity to showcase the Art Center's permanent collection while exploring some of the principles from the Blue Zones Project™.

Muscatine is among ten communities in Iowa that have been chosen as Blue Zones Project demonstration sites. The purpose of the Blue Zones Project is to encourage principles that make it possible for people to live longer, healthier and happier lives. The Art of Living Well is presented in five sections - Work, Play, Relax, Belong and Eat. Visitors will explore each of these sections and discover examples of "move naturally," "know your purpose," "down shift," "loved ones first," "right tribe," "plant slant" and other core principles of the Power 9^®.

"The approach to this exhibition is somewhat different from the way art exhibitions are often organized," says Director, Melanie Alexander. "The staff was challenged to find examples of people spending time in nature, gathering with friends, being physically active. The Art Center's collection of photographs, paintings, drawings, artifacts, postcards and other objects is full of examples of people in the past leading active lifestyles."

"In this exhibition, we put together works by well-known artists such as Grant Wood, John Bloom and John Steuart Curry to be displayed next to photographs of families picnicking, ice skates from the 1870s, Musser family scrapbooks and advertisements from the Muscatine Oatmeal Company. The Art of Living Well showcases the Art Center's collection of original art and historic artifacts."

The Art Center recently received a grant from the Iowa Department of Cultural Affairs that will make it possible to provide a variety of experiences for elementary through high school students when they tour the exhibition. The Art of Living Well is intended to re-enforce some of the healthy eating initiatives of the school district. While at the Art Center, 1^st grade students will use collage materials to create a healthy meal; 4^th graders will make prints from fruits and vegetables; 6^th graders will make fruit and vegetable still lifes in the style of Grant Wood. Visitors will also imagine themselves in a painting or photograph and carry out the movements of the people depicted.

"We hope that students will be attracted to the colorful depictions of fruits and vegetables and will enjoy thinking about what people in the past did to keep physically activity, relax or connect with one another."

The Art of Living Well runs from November 7, 2013 through June 15, 2014. Hand-outs and pledge forms for the Blue Zones Project will be available as part of the exhibition. Families can also put together a picnic using toy fruits and vegetables.

The Muscatine Art Center is located at 1314 Mulberry Avenue in Muscatine, Iowa. Hours are Tuesday through Friday from 10:00 a.m. to 5:00 p.m., Thursday evenings until 7:00 p.m., and Saturday and Sunday from 1:00 to 5:00 p.m. Admission is free. Donations are appreciated.