HELLMAN: Why is (military spending) an important issue to you?

REP. FRANK:  Because I think we are over-spending internationally, in areas where we don't have a major need, and that comes at the expense of important needs at home.  For example, we passed a law a few years ago, providing funds for local communities to hire police officers.  Tens of thousands of police officers have been hired, and I think that's been a contribution to one of the great successes we've had recently, which is a reduction in the crime rate.  There can't be any higher priority in a government than to protect people. 

Under our current budgetary plans,  under the balanced budget agreement enacted last year, we're gonna stop funding those police officers in a year or two, and the communities that hired them are gonna be faced with the financial need to raise local taxes. 

Why?  In part because we are defending Western Europe against a non-existent threat.  We are spending, it's hard to get an exact figure but clearly, tens of billions of dollars, on the military defense of Western Europe.  Now, we began the military defense of Western Europe, quite sensibly, 50 years ago, when Western Europe had been devastated by World War II, was poor, was defenseless, and the Soviet threat was quite menacing.  A couple of things have changed. Number one, Western Europe has become strong and prosperous; second, the Soviet threat has essentially collapsed as a threat to Western Europe.  The only thing that hasn't changed is that we're spending tremendous amounts of taxpayer dollars defending Western Europe, which could protect itself, if it needed protection, which it doesn't need.

So what we're talking about here is a zero-sum game, under the balanced budget act that was adopted.  Every dollar that we spend making sure that Russia doesn't invade France and that's why we got into NATO in the first place is a dollar that is not spent to keep a cop on the street in Fall River or New Bedford or Detroit or Chicago.  It's money not spent on cleaning up a superfund site.  It's money that we took away from the Medicare program.  We have a terrible crisis right now in home care.  If you are an elderly person who needs home care, you are in trouble because the balanced budget act severely restricted home care funds.

We were spending a lot of money on the military and people have pointed out that we are now spending less.  It's true, we are spending less.  But we have not reduced military spending nearly as much as the threat has been reduced.  Fifteen years ago, we were dealing with a Soviet Union and the Warsaw pact.  And if you go back to the ‘80s, and if you talk to the Pentagon as I did, they told you that we had to assume, prudently, that the Polish, and East German, and Czech, and Hungarian armies and the Bulgarians, we needn't forget the powerful Bulgarians that they were a threat to Western Europe, and that we had to spend money on the assumption that those armies would come against us.  The nations of Eastern Europe have now switched sides.  They're clamoring to get into NATO, and three of them are about to get into NATO. 

The Soviet Union has been dismantled.  You still have Russia, but you no longer have a Soviet Union.  You have about half the size.  The military threat that we were facing it's not disappeared, there is still North Korea, there is still Iraq, there is still Libya, and we should still have a major military force.  But I do believe that if you look at the diminution in the threat that came with the defection of the Warsaw pact countries and the breakup of the Soviet Union, the military threat has been diminished by more than we have cut the military budget.  And secondly, the European allies have a capacity for self-defense that we have not paid attention to.  The greatest subsidy, and the most unjustified subsidy that exists anywhere in the world today, is the subsidy the American taxpayers are providing to the prosperous nations of the European Union.

HELLMAN: Ah, you mentioned the balanced budget act and the zero sum game. How do possibly $50 billion in projected surpluses change the dynamic?

REP. FRANK:  Well, they don't change it in one sense the balanced budget act is a binding act as to how much we spend, and additional revenues are irrelevant to that.  Besides, there are other demands on some of those revenues.  The president quite sensibly said, "look, let's use this in part for Social Security."  The Social Security system is one of the great successes in American history.  It's been in existence for over 60 years, it's done an enormous amount, particularly once we began to index it for inflation.  That and Medicare together, we've transformed a situation where if you're a working person, the expectation would be that when you retired 50 years ago, your quality of life would substantially deteriorate.  We should be very proud as a society of having stopped that. 

Now, much of that surplus could go to shoring up the Medicare and Social Security systems, and preventing the need for severe deterioration in the quality of life for older people.  And again, I have to stress, that the balanced budget act hasn't been amended, and the Republican majority says that they don't want to change it they don't want to increase the amount of total government spending.  Even the president said that while he's for some initiatives that I strongly support extending Medical care for people 55 to 64, providing money for school construction, providing money for daycare centers… 

You know, we have a terrible social problem facing us; in part of my district, if you're eight years old, you almost certainly live in a house where there's a computer and someone to teach you how to use it.  In other parts of my district, the likelihood is that if you're eight years old, there isn't any such computer in your house, there isn't someone to teach you.  If we don't beef up the schools in the poorer parts of this country, the parts that have not benefitted from the economic advances of globalization that have enriched some people but others, in fact have impoverished some others, and diminished their income, we're gonna be perpetuating social inequality.  Physically improving the schools is a part, a necessary part, of extending this kind of computer literacy.  We can't afford that in the current budget.  Now even the president has said, "we can only do this if we raise cigarette taxes."  And we're in a terrible argument right now about whether or not we should raise cigarette taxes, and if we do and I'm in favor of that should we use it for these programs.  The majority position is, no, we shouldn't do that, and we should live with the money that we adopted in the balanced budget act.  And, given that, either we cut military spending, or we tell local communities we're not gonna continue to help them with police, we're not gonna clean up as many superfund sites, we're not gonna continue to have a good transportation system.  Those are the choices.

Hellman  You mentioned the Republican leadership is not supportive of changing the rules of the game with regard to the balanced budget act, but some of your colleagues republicans and Democrats down at the House National Security Committee, have expressed their willingness to re-address that issue.  Are they out of step with the political mainstream and the average American?

REP. FRANK:  The arguments I've heard from the National Security people have been, "let's take money away from domestic programs and put them into military."  They wanna address it by making a bad situation worse.  For example the recent budget we just passed, the supplemental appropriation, severely cut Section 8 housing, further exacerbating the housing crisis.  I have not heard any of them say, "we should use some of this surplus for restoring the home care cuts in Medicare."  They're talking about preventing further cuts in Medicare with this money, but they have not, to my knowledge, embraced doing that.  We have not had people embrace an expansion of day care, which I think is absolutely morally essential.  You can't tell welfare recipients that they should go out to work and not provide daycare for them in a humane situation. 

I have, in my own district, superfund sites that we haven't yet been able to tackle.  There are a lot of public needs here, and there are some things in a complex society such as ours which cannot be done individually.   I can cut taxes and cut taxes and cut taxes, and I'm not gonna be able to provide more cops on the street.  I'm not gonna be able to build school buildings in those urban areas where students are going to school in inadequate facilities. 

You know, we talk about increasing computer literacy.  There are many schools in America where if you gave them computers, and they plugged them in, the next sound you would hear would be the fire engines coming when the wiring blew up.  You need teachers to be trained.  You can make a lot more money these days if you are 24 years old or 25 years old and you are computer literate and sophisticated, in the private sector, than you can teaching 8-year-olds how to use computers.  I think that's gonna perpetuate social inequality.  And I'd like to be able to pay teachers more so we can compete for the first-rate talent that we oughtta have to do this. 

Now, none of those things will happen under the current rules.  Yes, it is true, we could say we're gonna take a large part of the surplus and add to total spending, but there are other claimants on that spending as said, the Social Security and the Medicare I would do some of that.  But even if we did do some of that, on its own merits, there is no justification for the United States spending what it's spending in Europe. 

Let me give one very concrete example.  In the supplemental appropriation we just passed, we appropriated $486 million that's quite a big chunk of federal funding just for three more months of the American ground troops in Bosnia.  I accept the fact that American ground troops have to be in South Korea to confront that terrible North Korean regime until the process of their becoming civilized is completed.  I think we need to confront Saddam Hussein as long as he is a threat.  And I wish he weren't but I think he still is.  There's clearly gonna be a need for an American presence in much of the world.  I do not understand why Germany and France and Italy and Denmark and  Belgium, etc., etc., a very large collection, a population bigger than ours all together, with a GDP bigger than ours, why can't they do Bosnia?  The Europeans say, "well, we're doing part of Bosnia."  But the US is doing all of Korea.  The US is doing almost all of the Iraq situation.  Isn't it ever Europe's turn?  Is Europe gonna be forever the dependent little brother? 

HELLMAN You mentioned support for shifting funds from domestic accounts while not increasing overall federal spending next year, the budgetary firewalls are scheduled to come down; how do you view that as affecting the current situation? 

REP. FRANK:  That's a major opportunity, and that's really the prerequisite for some of what I'm saying.  If the firewalls stayed up, then you could not in fact take money from the military and put it into domestic, although my conservative colleagues are perfectly willing to do the other way around.  While the Senate didn't go along, the bill that the House voted by majority took money from domestic programs airport construction, I have a city, New Bedford, where an airport expansion would be very helpful economically, the businesses in the New Bedford area tell me that if we could expand the New Bedford airport runway from 5,000 feet to 8,000 feet, we could do a great deal to improve employment in a depressed area, an area that's been depressed in part by national policies, national trade policies that have devastated the garment and textile industries, national conservation policies that have severely curtailed fishing. 

The Republicans in the House have actually voted to take money out of the airport construction account and put it into Bosnia.  The Senate said no to that.  They were in effect prepared to breach the firewalls.  But next year there will be no firewalls.  We will have a balanced budget act which puts an overall limitation on spending of about a trillion dollars and it will call for it to be roughly 50 percent in the discretionary account in the military and 50 percent elsewhere.  If we could make that 60-40, we could do an enormous amount to improve the quality of life in America without in any way shape or form diminishing the security internationally.