Let me begin by saying that I stand united with the President and my colleagues on both sides of the aisle in our commitment to defeat terrorism and to do what is necessary to preserve national security both at home and abroad.  However, in light of the many new security and economic challenges confronting us, our homeland protection efforts and fiscal policies should not shortchange Social Security and other national priorities.  We can win the war against terrorism without raiding the Social Security and Medicare Trust Funds and without increasing the national debt.  

Earlier this month, the Congressional Budget Office (CBO) confirmed that in less than a year the 10-year projected surplus declined by $4 trillion.  While portions of this decline are a result of the war, the depletion of the surplus to date was also largely caused by last year’s fiscally irresponsible policies.  The additional $800 billion in tax cuts proposed in this year’s budget would only worsen our current situation and lead us further down the path of mounting deficits and escalating public debt.  To pay for the additional tax cuts, this budget would raid more than $2 trillion from the Social Security and Medicare Trust Funds to cover deficits in the rest of the federal budget over the next ten years.  We need a wartime freeze on tax cuts to avoid deficit spending.

When I was elected to Congress, I promised my constituents that I would protect the Social Security and Medicare Trust Funds.  And I was not alone.  Over one hundred of my colleagues have co-sponsored legislation to prevent Congress from spending the Social Security and Medicare surpluses, and the House of Representatives has voted seven times in the past three years to establish lockboxes for these funds.  

The current Administration made the very same pledge to not touch these vital trust funds.  This budget breaks that promise.  It is time to honor our commitments by acknowledging our current situation and work together to craft a budget that is fair and fiscally responsible.  

Moreover, the projections used to frame this budget are optimistic.  They do not include the Administration's budget request for an additional $48 billion for the military and homeland security, which I support but needs to be included in the budget projections.  Further, they do not include a Medicare prescription drug plan, which was also promised by both the Administration and Congress.  The projections also leave out an assessment of the lost revenue resulting from extending expiring tax credits and modifying the individual alternative minimum tax that will impact millions of middle-income taxpayers over the next 10 years.  And they rest on the smoke-and-mirrors premise that all of the tax cuts enacted last year will be rescinded in 2010.  A more realistic set of assumptions would show that the 10-year budget surplus has already vanished. 

The disappearance of the 10-year surplus compels us to consider not just a one-year but also a long-term budget plan.  Congress and the American people have the right to know how the Administration proposes to restore fiscal discipline while enacting additional tax cuts, boosting spending for the military, and meeting commitments to a growing number of retirees.  The Administration and Congress should devise budgetary rules that make tax cuts and spending contingent on the realization of specified targets for the budget surplus and the federal debt.  Unfortunately, this budget fails on all those accounts.  

I am also deeply concerned about the draconian cuts to the Small Business Administration.  The budget proposes cutting the funding for the 7(a) loan program in half.  Last year, this loan program provided over $94 million in assistance to Rhode Island's small business community.  Additionally, the Administration proposes cutting funding for employment and training programs by $686 million.  With more than 1.4 million workers laid off over the last year, we need this funding now more than ever.  The budget would also slash the Low-Income Heating and Energy Assistance Program (LIHEAP) by $300 million.  This program is crucial for all New England states and particularly for our seniors, who are often forced to choose food over heat.  Finally, the budget would cut $417 million from the Public Housing Capital Fund, which helps provide 1.2 million families nationwide -- 40 percent of whom are elderly or disabled – with affordable housing.  Housing needs are especially acute in Rhode Island, where 38 percent of renter households pay more than 30 percent of their income for rent. 

In closing, I would like to thank the Chairman and Ranking Member for allowing me to take part in this important discussion.  There are many tough choices ahead, but I believe that with cooperation and an eye towards operating within a responsible framework, this Congress can develop a budget that will ensure security at home and abroad, without dramatically increasing our debt, borrowing against Social Security and Medicare, or abandoning our commitments to children, workers, senior citizens and all Americans.