The Congressional Record (House) June 25, 1997 During Debate on the
BALANCED BUDGET ACT OF 1997
Mr. PAUL. Mr. Speaker, I rise today in opposition to the Balanced Budget Act (H.R. 2015), authorizing the expenditure of an additional $3 billion in taxpayer dollars on `Welfare to Work' programs as the Federal Government has no constitutional authority to spend taxpayer dollars on welfare-to-work programs.
Congress is once again engaging in the tired ritual of the 5-year balanced budget plan. Repeatedly over the past 25 years there have been lofty proclamations that the budget would be balanced in 5 years because of government forecasts of continued growth. Each 5 year plan was announced with great fanfare and happy feelings of bipartisanship, yet, each plan fails to balance the budget because the economic forecasting upon which they were based never reflect actual economic circumstances.
The Federal Government cannot predict exactly how the economy--the aggregate spending and saving habits of every individual in the nation--will behave over the course of the next 5 years. Because the economic situation in the future will be based upon the actions of individuals acting on their subjective preferences, these preferences are impossible to predict. The failure of every socialist government, whether totalitarian or democratic, to fulfill its leaders' promises of unlimited economic prosperity demonstrates the futility of government planning based upon the economic forecasts of government officials.
It is, however, only a matter of time before the burden of taxes, spending, debt, and inflation catapult America's economy into yet another recession. When the optimistic projects of growth prove to be based more in hope than reality, the budget figures will be `revised' and a future Congress will once again confront the questions of balancing the budget.
Even if the budget being considered by this Congress were guaranteed to balance the budget within 5 years, it should still be rejected because it fails to eliminate even one unconstitutional function of the Federal Government. Despite proclamations that `the era of Big Government is over', this budget actually increases taxpayer spending for many unconstitutional programs. The main problem with government policy today is not that the government cannot balance its books, but that the Federal Government is performing too many functions for which it lacks any constitutional authority.
Mr. Speaker, the authorization of an additional three billion dollars for a welfare-to-work program, is a perfect example of how the budget proposal fails to address the basic question of how the welfare state exceeds the constitutional limitations on the power of the Federal Government. Under the tenth amendment to the United States Constitution, the Federal Government has no authority to take money from the people of Texas to spend on welfare programs for the people of New York. Welfare and job training programs are strictly the province of the individual States.
The reconciliation proposal not only unconstitutionally spends Federal taxpayer funds on welfare programs, it dictates to the States how they must run their welfare-to-work programs. For example, States are required to spend 1 dollar of their own money for every 3 dollars of Federal money they receive, and they must distribute the funds according to a pre-determined Federal formula.
Short of defunding all welfare programs and transferring responsibility for those programs back to the States and the people, Congress should provide maximum flexibility to the States to manage these programs as State officials see fit. For example, the amendment offered and later withdrawn by Mr. Johnson to allow State governments to use nongovernmental personnel in the determination of eligibility under the Medicaid, Food Stamp, and special supplemental nutrition programs for Women, Infants, and Children, is a step toward restoring federalism in welfare policy. It is not for Washington to determine the strengths and weaknesses of such a plan, these decisions are solely the responsibility of the States.
In the name of transferring citizens from welfare to work, this bill provides millions of taxpayer dollars to move businesses onto the welfare rolls. Under this proposal, State governments may hand over taxpayer dollars to businesses for private sector job creation, employment, wage subsidies, on-the-job training, contacts with job placement companies, and job vouchers. By providing payments to private businesses who place and hire welfare recipients, Congress is creating a dangerous and powerful new constituency for welfare programs and, in effect, making it more difficult for future Congresses to reduce welfare expenditures.
The welfare-to-work proposal also creates powerful disincentives for businesses to give welfare recipients a chance at a new life through an entry-level job. If this proposal becomes law, welfare recipients in entry-level jobs will be entitled to receive the minimum wage and be covered by certain health and safety regulations. Because mandating wages and benefits increases the costs to businesses of hiring new workers, any wage, safety, or health regulations discourage the hiring of new employees. This is especially true in the case of marginal employees who lack well-developed job skills. This bill restricts welfare recipients' ability to find gainful employment; the very population this bill is allegedly targeted to benefit.
It is time to return to the most effective job creation machine in history--the free market. Any alternative necessarily results in suboptimal employment. Government is institutionally incapable of creating bonafide jobs. Private citizens acting freely are more than capable of caring for the needs of the less fortunate if the Federal Government stops appropriating so many of their resources for wasteful, bureaucratic, federal programs.
In conclusion, Mr. Speaker, I urge Congress to reject the phony balanced budget plan before us today as that plan rests on two dubious notions: 1. Government can predict the economic future of the country; 2. The burden of taxes and spending placed on the economy by government will not cause America to experience an economic downturn.
Furthermore, this proposal continues the Federal Government's unconstitutional micro-managing of State welfare programs. This bill extends corporate welfare in the form of subsidies to businesses which hire current welfare recipients thus creating a new client group for the welfare State.
Mr. Speaker, the only way to permanently balance the budget and end welfare as we know it is to cease all federal expenditures for redistributionist programs not authorized under the United States Constitution. Therefore, all Members of the House of Representatives sincerely committed to limited government must oppose this proposal and instead work to defund all unconstitutional programs and return the authority for welfare programs to those best able to manage them.