Mr. President, I would like to voice my strong opposition to this budget reconciliation bill as I have to the budget resolution that led to it. I realize that months of work and endless sleepless nights have gone into its drafting, but unlike those who support it, I cannot believe this is the best deal we could get. And, it is a far cry from the kind of budget package demanded by the American people. It is, in fact, as far from what this economy needs as Arizona is from being a rain forest.

In my view, the huge budget deficits that have been the norm over the past dozen years are the biggest, most pernicious domestic problem before this Nation. They are the product of overgenerous social and defense programs that were implemented in the 1960's, 1970's, and 1980's, and which have never been reformed, terminated, or otherwise brought under control.

Since World War II there has been a steady deterioration in our fiscal policy--deficits as a percentage of GNP have doubled every decade since the 1950's. Our expenditures have ballooned--and so has the tax burden on the American people.

For years we have known that enormous Federal budget deficits plunder our national savings. We have been remiss for so long in controlling deficits that our savings rate has more than halved since the 1960's to less than 4 percent. Our savings rate is 40 percent of Germany's and only 20 percent of Japan's. And despite the lipservice that Congress pays to the importance of international competitiveness and the need to foster investment, the deficits keep getting bigger, and our expenditures keep setting new records.

It is the expenditures, Mr. President, that need to be brought into line. The waste, the inefficiency, the mismanagement, the redundancy--this is what the American people demand be trimmed from this budget, and this is what this budget agreement fails miserably in doing.

Instead, this budget package relies on the largest tax hike in history; it raids the health care program for our elderly; and fails miserably in instituting structural reforms that would help put the brakes on congressional profligacy.

Mr. President, let me first elaborate on my opposition to this tax increase. The Tax Foundation has recently done an analysis of the erosion of the average American family's real income which it anticipates this year. Part of the problem is inflation, which is on the rise. The rest is taxes. According to this report, since 1980, the Federal income tax bill paid by the median family has risen 56.9 percent. As a percentage of the family's total income, the Federal income tax claimed 13.7 percent of the family's total income in 1980--fell to a low of 11.8 percent in 1987--and has rebounded to 12.4 percent.

Now, we are about to foist another huge tax burden on these families.

These increases will be in the form of gasoline taxes, aviation taxes, excise taxes, and rate increases, and yet, it doesn't impose a surcharge on the 60,000 Americans whose income is $1 million a year or more.

Mr. President, I also resent that this tax package contains breaks for oil and gas, for wineries, and for other special interest groups who have influence over the tax writers of Congress. How can it be that we give breaks to the select few while ignoring millions of Americans who have made their opposition to new taxes clear in the two recent Presidential elections?

The truth of the matter is that this agreement repeats a mistake that was made no less than four times in the last 8 years. The mistake is that this is another bipartisan agreement in which the Republicans have acquiesced on taxes and the Democrats have indicated they will do the same on spending. In each of the past four agreements--in 1982, 1984, 1987, and 1989, promises were made to rein in spending and assurances were made that the new taxes would be devoted to deficit reduction. But, in every single case, Congress went ahead and spent the new revenues and the deficit surged. Ironically, in the years that there was no agreement, the deficit decline!

There is every reason that this year will be the same. The taxes will be the law of the land, and the spending side will be undone next year. This year may, in fact, be worse, because the $490 billion in deficit reduction that is supposed to take place over the next 5 years is predicated on continued growth in the economy. Yet, this economy is flagging.

It seems to me that heaping gobs of taxes on an already ailing economy is like giving fresh flowers rife with pollen to an asthmatic--it is a recipe for disaster.

This has been borne out before. Never since the Second World War have we raised taxes to over 19.6 percent of GNP--as this package undoubtedly will--without tipping the economy into recession. This time we are starting with a slow economy--anyone can figure out what $140 billion in new taxes will do.

Mr. President, the way to cut the deficit and the way to make this economy as robust as it has been during the last 95 months is to do what the taxpayers want us to do. We need to eliminate waste, inefficiency, and mismanagement before we even consider raising taxes. This package is 0 for 3 and yet we are being asked to agree to the largest tax increase in history?

Mr. President, I also disagree with the approach taken on Medicare. I have believed all along that this is not the time nor the place to be restructuring the Medicare Program dramatically.

The last time we tried to balance the budget on the backs of seniors, a firestorm swept the country. Fortunately, this conference agreement backs away from the significant increases in Medicare premiums and deductibles that have been contemplated throughout this budget process this year. But, it does not back away from it enough.

There is no question that we need to address rising health care costs, but to ask the elderly to pay more and more without doing anything to control the rising costs means that we will be right back picking their pockets next year when health care costs rise in the double digits once again. Plain and simple, increasing premiums without health care cost reforms or providing new benefits is a thinly veiled budget tax increase.

I am also very concerned about the impact of this package on Medicare providers because the House refused to accept the Senate's proposal to eliminate the urban/rural payment differential. I have advocated eliminating this differential for some time because there is no reason to paying rural hospitals less than urban hospitals for the same services. There is no indication that it is cheaper for rural hospitals to deliver care--and in fact, in some cases it is ever more costly.

I am pleased, however to see that there are several provisions in this bill which I do favor, like mammography screening and a number of important end state renal dialysis' measures which I sponsored with Senators Bentsen and Heinz, and which were included in the Senate-passed reconciliation bill.

I am also pleased at the inclusion of the proposal I offered with my good friend, the senior Senator from Missouri, to require hospitals to inform patients of living wills and medical directives upon their admission for care.

Let me also point out another improvement over the budget summit. I am pleased that the House has accepted the proposal that I offered with Senators Heinz and Moynihan to the Senate bill which takes Social Security off-budget and out of the Gramm-Rudman-Hollings deficit calculations.

I favor this because the current practice is, in short, dishonest. Moreover, without the change, baby boomers would have found that as they reach retirement, the trust funds would begin to be drawn down, and there would be nothing but IOU's because the deficit has been allowed to offset the largest portion of the trust funds--interest payments and the tax revenues.

Obviously we can't let this happen. Pure and simple, the continuation of the practice of having Social Security on-budget and included in the deficit calculations would legitimize the concern that many baby boomers have--that Social Security will be unable to provide them with benefits when they retire.

Again, I am pleased that the House has agreed to the proposal to take Social Security off-budget and out of the deficit calculations.

Mr. President, the third major down fall of this package is that is lacks the budget process reforms that this institution so badly requires. We need real, structural reform in the budget process, not the complicated changes in this package which have fancy names that confuse the daylights out of everyone, including so-called budgeteers. We need budget reform that will require us to make our deadlines and that will impose discipline on Congress--the negligent keeper of the country's purse.

One of the most important budget reform measures we can adopt is the line-item veto. My friend from Indiana, Senator Coats, and I have offered our own line-item veto bill twice as amendments to spending bills, and twice we have lost on parliamentary maneuvers. Mr. President, the time has come for us to concede that Congress desire to fritter away the taxpayer's hard earned dollars is insatiable and that the President needs the line-item veto to curb that desire.

Over 70 of American taxpayers, who fund preposterous projects and special interest programs each year, support giving the President the line-item veto. This package seems only to contain the complex budget measures that the failed summit agreement contained, which will worsen this already confusing process. The new budget also contains special interest projects that are so offensive, like $500,000 for a Lawrence Welk memorial; $3.2 million for a neighborhood economic improvement project in New Orleans; and $1.2 million for a metals casting center in Iowa. With this type of waste, it is no wonder that the American people are losing their confidence in Congress by the day.

Under this proposal, we will continue missing deadlines and facing 11th-hour decisions again next year and the year after that and the year after that.

Finally, this agreement just won't work. The economic assumptions it is based on underestimate outlays; the temptation by committees to play smoke and mirrors games remains; and if the new taxes slow the economy, spending will burgeon and the revenues will fall short of projections.

It is vitally important to achieve the goal this agreement aims for--but it misses badly. As GAO recently wrote in a report on the budget deficit, deficits have an `ominous implication for economic growth.'

I know that the President has had a difficult time negotiating with the Democratic leadership of this body. He has made serious concessions. In fact, he has had to go too far in his concessions to make the Democrats come along. It is because of many of these huge concessions that I oppose this package.

There are options that I do support, one of which is called the 4-percent solution and has been introduced by my good friend, the distinguished junior Senator from Montana. As most of my colleagues know, this would freeze all spending increases at 4 percent per year, thus requiring Congress to make spending decisions within a certain level of outlays each year. This would force Congress to make dozens of very difficult choices--and would leave the taxpayers alone. The reason the 4-percent solution works, Mr. President, is that the outlay freeze is barely enough to cover inflation and would result in a $50 billion increase every year. Revenues, on the other hand, are already projected to increase about $75 billion a year, and according to proponents of the plan, this would be enough to balance the budget by the late 1990's.

Another option would have been a $40 billion sequester. This is not the ideal solution by any stretch of the imagination, but with the economy in as weak a state as it is, one of the major advantages of sequester is that the taxpayers don't end up with the short end of the stick. Instead of taking money out of the hands of consumers, workers, investors, savers, the elderly, and others who would see an increase in their tax burdens, a sequester would make across-the-board cuts in most programs and would result in savings of as much as $335 billion over 5 years.

In other words, Mr. President, there are alternatives to the budget we are presented with today which do not have the egregious flaws of this proposal. They would get spending under control without taxes or an assault on Medicare. And, combined with budget reform, they would be the best medicine for our economy. This budget bill before us today amounts to business as usual at a time when our constituents want change and results. There are options which are much better, even though painful, and we ought to have adopted one of them.