GrammNet Issue 4/3/97.2 Dear Friend of Phil Gramm, Following is a column and a wire service story regarding the recent activities of Phil Gramm. The column was written by liberal columnist, David Broder, who usually is quite hostile to Gramm. However, now that Gramm isn't running for president, a few liberals--ones who can count--have started to listen to what Gramm's saying and have realizied that unless the government radically reforms Medicare, it's going to collapse. And if one of the most popular entitlement programs goes, it may take the others with it. Gee--maybe Gramm SHOULDN'T say anything about Medicare! The wire service article demonstrates that, at a time when most of the Republicans in Washington are either lying low or going along with the Democrats, Gramm continues to work to achieve the conservative agenda--in this case, the elimination of affirmative action. It's good to know we can count on Gramm whether he's running for office or not. Sincerely, David B. Levenstam, CPA, MT, MA Gramm in 2000! ---------------------------- The Washington Post Wednesday, March 26, 1997 Medicare: The Worst Is Yet to Come By David S. Broder Sen. Phil Gramm of Texas ran a poor race for the Republican presidential nomination last year and disappeared from the contest before most voters heard him or his message. What Gramm is saying these days makes you wish he had the kind of "bully pulpit" only the White House provides. Gramm has developed a chart talk that does for Medicare what another Texan, Ross Perot, did for the budget deficit with his 1992 presidential campaign infomercials: Make the problem clear. The difference is that Perot had a huge national audience while Gramm has to do his flip charts repeatedly to reach even a thousand people. Once you have seen them, however, you understand how dishonest and dishonorable it would be for the scaredy-cat politicians in the White House and on Capitol Hill to walk away from the Medicare crisis with only a temporary fix that would leave the underlying structural problems unrepaired. The first of Gramm's charts shows that the problems go back to the very creation of Medicare in 1965. That year of President Lyndon Johnson's Great Society program was significant in two other ways. Just before the Vietnam buildup triggered inflation, it marked the end of a period of economic growth that generated a marked rise in real incomes. And it also marked the end of the baby boom that would, as the boomers matured, temporarily swell the number of working Americans whose payroll taxes would pay for their elders' new medical benefits. In the 1970s and 1980s, real economic growth and the birth rate both slowed down, while the elderly population began to grow. But another Gramm chart shows that we are barely at the edge of the real senior-citizen explosion. This year, the number of Americans over 65 will grow by 200,000. Fifteen years from now, the annual increase will be 1.6 million -- eight times as large. That is why Gramm says these ought to be the good times for Medicare -- a time to be storing surpluses for the crunch ahead. But in fact, the program costs are so out of control that it is running in the red and its reserves will be exhausted in four years. President Clinton's answer is to squeeze $100 billion or a bit more out of the providers -- doctors, hospitals and managed-care companies -- buying a few years of grace but leaving the structural problems unsolved. If that is all that is done this year, Gramm says, this nation will inevitably face "the greatest internal financial crisis" in history, one that will make the savings-and-loan bailout of the 1980s look like a tea party. Gramm told me that the greatest frustration of his Washington career was not his flop as a presidential contender but his inability to convince his colleagues in Congress to take early action to head off the savings-and-loan crisis. As a relatively junior legislator, he was stymied by then-House Speaker Jim Wright (D-Tex.).Now, as the chairman of the Senate Finance subcommittee that handles Medicare, he may have the clout to get something done. Gramm can be both partisan and abrasive. But on this issue, says Sen. Ron Wyden (D-Ore.), a liberal who shares Gramm's disdain for the quick-fix Medicare palliatives, "Phil is really reaching out to both parties." Although they differ on important details, Gramm and Wyden agree that salvation lies in redesigning the aging Medicare program to incorporate the features that have begun to produce genuine savings in the private sector. Wyden, whose home city of Portland has been a model in this transition, told me that if the changes are introduced promptly but gradually, "We can provide people with better choices, achieve large savings and protect patients' rights." But all that is conjectural, because Clinton is not part of this effort. Instead, he has used his unrivaled platform to mislead the public into thinking that painless economies will deal with the problem -- for a while. Incredibly, he also has promised new benefits, notably a phaseout of the co-payments for home care. When Gramm asked earlier this month what those new benefits would cost over the next decade, the man who runs the Medicare program, Bruce Vladeck, said he had been forbidden by Clinton's Office of Management and Budget to give estimates beyond five years. It took a threat from Gramm to block confirmation of pending presidential appointments to the Department of Health and Human Services to force the administration to come clean. Their figures confirm Gramm's fear that Clinton is disguising an unfunded obligation that would reach $15 billion a year within a decade. Gramm asks an interesting question: "If President Clinton didn't want to help us solve these problems, why did he run for a second term?" ---------------------------------------------- 10 AP 03-28-97 02:46 EST 76 Lines. Copyright 1997. All rights reserved. PM-TX--Affirmative Action Gramm demands Education change its position on Texas affirmative action By MICHELLE MITTELSTADT Associated Press Writer WASHINGTON (AP) Disagreement between the federal government and judges over affirmative action has placed Texas colleges in a ``withering legal crossfire that can only damage them,'' says Sen. Phil Gramm. The Texas Republican on Thursday urged Education Secretary Richard Riley to retract a top aide's position that Texas universities and colleges can continue to use race and ethnicity in making certain decisions. That opinion by assistant education secretary Norma Cantu, head of the Office of Civil Rights, runs counter to the position staked out by Texas Attorney General Dan Morales. Citing a 5th U.S. Circuit Court of Appeals ruling, Morales last month issued a legal opinion directing Texas colleges and universities to have race-neutral policies for admissions, financial aid, scholarships and other aspects of college life. Morales issued the opinion after the Supreme Court left intact the 5th Circuit decision striking down the University of Texas law school's former affirmative-action admissions policy. The plan, designed to boost minority enrollment, amounted to unlawful bias against whites, the appeals court ruled. But Ms. Cantu took issue this week with Morales' position, writing him that the 5th Circuit ruling doesn't invalidate ``narrowly-tailored'' race or ethnicity considerations in Texas higher education programs. In a strongly worded letter, Gramm urged Riley to retract the Cantu position ``immediately.'' ``It must be clear to you that Ms. Cantu has placed Texas colleges in a withering legal crossfire that can only damage them, their programs and their students,'' Gramm wrote. ``Which of two feuding branches of our government are they to follow, risking punitive action from the other?'' Gramm's letter was prompted by outpourings of concern by Texas university administrators within the last few days, said spokesman Larry Neal. The administrators are walking a tightrope, Neal said, fearful of disobeying a federal appeals court but at the same time worried that failure to follow Education Department mandates could jeopardize their federal funding. Wrote Gramm: ``In her zeal to pursue a political agenda, will Ms. Cantu be available to pay the fines and serve the sentence for contempt if she is successful in forcing Texas universities to flout the federal court's ruling?'' Ignoring the Education Department could cost Texas up to $1.8 billion in federal funds, state Sen. Rodney Ellis, D-Houston, has estimated. While Gramm said Ms. Cantu's correspondence threatened a loss of ``all federal assistance to colleges in my state,'' her March 24 letter to Morales made no reference to elimination of funds. In a March 18 letter to Ellis and others asking if federal funds were in jeopardy, Ms. Cantu replied: ``We fully expect Texas voluntarily to seek to remedy any current effects of past discrimination that are found to remain.'' Her office is assessing whether Texas has eliminated vestiges of discrimination in its public higher education system. If discrimination is found, affirmative-action remedies could be imposed. As a last resort, Texas could face loss of federal funds. The Office of Civil Rights contends some race and ethnicity considerations are allowed under the Constitution, the Civil Rights Act and two Supreme Court rulings. In 1978, the Supreme Court ruled in the Bakke case that race can be considered as one of many factors in a school's admission policy. In 1992, the high court ruled in Fordice that states cannot adopt race-neutral policies to remedy past segregation. Morales' office contends his opinion is a clearcut response to the 5th Circuit ruling, under which Texas must operate.