Apr 11 2013
Opening Statement of Chairman Patty Murray at the Hearing on the President’s Fiscal Year 2014 Budget Proposal
“This hearing will now come to order. I’d like to thank ranking member Senator Sessions and all of my colleagues for joining me here today. As well as members of the public here in person or watching online.
“Today’s hearing is on the President’s Fiscal Year 2014 Budget Proposal. Our witness is Acting OMB Director Jeff Zients, who is here to talk about the proposal and answer our questions.
“Jeff, I want to start by thanking you for being here today and for all of your hard work at OMB during some really tough times. Your skilled leadership has been instrumental in helping our nation work through a number of budget crises, any of which could been devastating to our fragile economic recovery had we been unable to work our way through them.
“We especially appreciate your willingness to serve as Acting Director the past 15 months, including your work on the past two budgets.
“I know that you and your family have sacrificed in order to provide continuity to the agency and the dedicated employees who work there. It is sometimes thankless work, but you’ve done a great job, and I want the Record to reflect the thanks from me and the rest of the Members of this Committee.
“I imagine we are going to hear some questions about the timing of this budget, but everyone should keep in mind why our budget process has been operating so far outside regular order.
“The uncertainty surrounding the fiscal cliff had major ripple effects on budget-writing in Congress, as well as, I’m sure, at OMB. The policy changes coming out of the year-end deal added to the challenges, and then sequestration, which we all hoped would be replaced, went into effect and shuffled the dynamic even further.
“So I am hopeful that we can return to regular order in the budget process, but let’s be clear, there has been nothing regular about the lurching from crisis to crisis over the past year.
“As I am sure Jeff will talk a bit more about, the fact that the President’s budget timing has shifted, along with other considerations, has changed the way they have approached their proposal.
“Normally, during times when we aren’t dealing with fiscal cliff uncertainty and devastating automatic cuts, the President lays out his budget proposal, the House and Senate hold hearings on it, and it influences our work as we write our respective budgets in Congress.
“This year, of course, is different. The House has passed their budget, the Senate has passed our budget, and now we are trying to move toward the next step in the process and find a way to get a balanced and bipartisan deal.
“So President Obama has made it very clear that the proposal we are discussing today doesn’t reflect his thoughts on the ideal policy, and it certainly doesn’t represent any kind of new starting point for negotiations.
“It’s not the budget I would write on my own, and it includes several policies that I don’t think are the best ways to tackle the deficit and debt.
“While I was glad to hear some Republicans in the past few days express interest in finally putting an end to governing by crisis, I was very disappointed to see members of their leadership come out and seemingly reject any compromise at all. And I hope that those Republicans are now prepared to tell us their ideas for a bipartisan path forward. I know the American people are expecting us to work together to come to a deal, I know I am ready to do that, and I think the onus is on Republicans to show they are as well.
“While this proposal reflects President Obama’s compromise offer, I was very glad to see that the President maintained his commitment to putting jobs and broad-based economic growth first. I know us Democrats here in the Senate feel very strongly that protecting our fragile economic recovery is paramount. The budget we passed reflects that, and any deal we come to would have to work for middle class families and the economy as well.
“One of the most important ways that both the Senate Budget and the President’s proposal puts the economy first is by replacing sequestration in a fair and responsible way.
“I know that when I went home to Washington state over the recess, my constituents told me about the negative impact that sequestration was already having on families and communities. I am sure my colleagues heard similar stories back in their home states—and this problem is only going to get worse.
“We all know that sequestration was never intended to take effect—it was supposed to motivate both sides to compromise. That is why the Senate Budget replaces these automatic cuts with an equal mix of responsible spending cuts and new revenue.
“And while the House Budget refused to include any compromise in this area, and replaces only the defense cuts while making even deeper cuts to programs families and seniors depend on, I am hopeful we can work together on a fair and responsible replacement.
“In addition to replacing sequestration, the President’s proposal, like the Senate Budget, also prioritizes creating jobs and laying down a strong foundation for long-term economic growth through investments in early childhood education, college affordability, transportation infrastructure, and other key programs that we include in the Senate Budget as well.
“I was also very glad to see that the President’s proposal maintains the key principle in the Senate Budget that is supported by bipartisan groups and the vast majority of the American people, that deficit reduction needs to be done in a balanced way, and include a responsible mix of spending cuts and new revenue from those who can afford it most.
“Since the Simpson-Bowles report was released in 2010, which recommended $4 trillion in deficit reduction, Congress and the administration have worked together to reduce the deficit by $2.4 trillion, with $1.8 trillion coming from spending cuts, and $600 billion from allowing tax rates to rise on the wealthiest Americans.
“The Senate Budget as well as the President’s proposal builds on this work to exceed the bipartisan goal of $4 trillion in a way that reduces the deficit to below three percent of GDP and that pushes our debt as a percentage of the economy down and moving in the right direction.
“If the Senate Budget was enacted, the total deficit reduction since the Simpson-Bowles report would consist of 64% from spending cuts, 14% from rate increases on the rich, and 22% from new revenue from closing loopholes and cutting wasteful spending in the tax code that benefit the wealthiest Americans and biggest corporations.
“The ratios under the President’s compromise proposal would be slightly different, but the fact that it includes a mix of spending cuts and new revenue reflects the values and principles of balance and fairness that the vast majority of Americans have clearly stated they support.
“In addition to responsible spending cuts, a critical component of a balanced approach is ensuring that the burden of deficit reduction isn’t borne solely by the middle class, seniors, and most vulnerable families. And that means making sure the wealthiest Americans and biggest corporations are paying their fair share.
“Although our budget leaves the specifics to the Finance Committee and the President’s proposal lays out a particular path, both put revenue on the table and specifically cite the need to close loopholes and wasteful deductions that benefit the rich.
“This shouldn’t be controversial.
“In 2012, on average, the top 1% of income earners saw their after-tax income increase by nearly $250,000 as a result of special tax provisions, but the middle class only received an average of about $3,500. These heavily skewed tax breaks do little for our economy; they just make it harder for middle class Americans to get ahead. And especially at a time when we are looking everywhere for savings, we just can’t afford them.
“Even many Republicans agree there is waste to be found in the tax code. Speaker Boehner proposed raising $800 billion for deficit reduction by closing what he called ‘special interest loopholes and deductions.’ Chairman Ryan has noted that ‘The tax code is patently unfair.’ And he has said that many of the deductions and preferences in our tax code are ‘mainly used by a relatively small group of mostly higher income individuals.’
“In fact, to keep the House Republican budget’s tax reforms revenue neutral, as they have committed to doing, they would have to identify $5.7 trillion in savings from the tax code to pay for the tax rate cuts they want to give to the rich.
“That is almost six times what the Senate budget proposes.
“So House Republicans clearly know there are savings to be found in the tax code, the difference is that Democrats believe that instead of that savings going toward more tax cuts for the rich, we should use it to reduce the deficit and invest in the middle class.
“I was very glad to see that although some of the details differed, the President’s budget reflects that critical idea as well.
So I am looking forward to hearing more about this proposal today and asking some questions.
“The Senate Budget we passed last month reflects where I think our country needs to be, as well as the pro-growth, pro-middle class values and priorities of Senate Democrats and the vast majority of the American people as we move into negotiations with the House. And I am hopeful that Republicans will come to the table and show they are willing to compromise to get a deal.
“I’ve been talking to Chairman Ryan about my desire to move to the next step in this process under regular order and do everything possible in a conference committee to bring the House and Senate budgets together. I know it will be difficult, but it’s what the American people expect—and I think we owe it to them to make it work.
“Before we ask our witness to deliver his testimony, I’d like to turn to the Ranking Member Senator Sessions for his opening remarks.”
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