[Congressional Record Volume 141, Number 40 (Friday, March 3, 1995)]
[House]
[Pages H2643-H2644]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


  PARTIES SHOULD AGREE ON COURSE OF ACTION TO AVOID ECONOMIC DOWNTURN

  The SPEAKER pro tempore. Under the previous order of the House, the 
gentleman from New Jersey [Mr. Saxton] is recognized for 5 minutes.
  Mr. SAXTON. Mr. Speaker, some months ago, after having been through 
the election and after having campaigned to support the provisions of 
the Contract With America, I came to the realization that subsequent to 
the policies that have been prevalent during this administration that 
had to do with tax policy, and then with the Fed increasing interest 
rates along with that tax policy at the same time we had high taxes, 
that history would ultimately repeat itself, and that our economy could 
not sustain itself with relatively high taxes and with increasing 
interest rates. There would come a time when our economy would turn 
down and that things would not be as this administration and all of us 
would like them to be. Perhaps that is not far away.
  I take this special order this afternoon to just bring light to the 
fact that there are clouds on the horizon, and that we as Republicans 
and Democrats need to agree on a course of action to avoid what could 
be an economic downturn, serious economic downturn.
  I picked up the Wall Street Journal this morning, and as I turned 
through the pages and got to page 2, I found three articles that 
disturbed me. The headline on one was ``Consumers Held Down Spending 
During January.'' In reading that article, it simply said that 
consumers were hesitant to spend, as perhaps they has been at some 
previous times recently.
  I looked at another article that disturbed me along the same vein 
that said ``Retailers See Mildly Disappointing Sales for February Amid 
Slowing Economy.'' Of course, that headline speaks for itself. Everyone 
can understand why we would be disappointed to see that the economy, as 
this headline says, is slowing.
  But then I saw a headline that really disturbed me, because a very 
important part of the Contract With America, things that Republicans 
and some Democrats agree on that are part of the contract, is that we 
can do some things here in the House of Representatives that will help 
to avoid a slowdown in the economy. And this third article, which 
really disturbed me, has a headline which says, ``Rubin Questions the 
Economic Impact of Capital Gains Tax Cuts, Tax Reform.''
  This is Secretary Rubin, President Clinton's Secretary of the 
Treasury, and, of course, he is a very important person when it comes 
to directing economic policy. And that part of this that disturbed me 
the most said that he is being reported to have said ``No significant 
tax reform is likely to emerge from Congress without substantial 
leadership from the Treasury, and 
[[Page H2644]] Mr. Rubin said he is not inclined to deploy the 
Treasury's limited resources to design a tax reform scheme of its 
own.''
  Now, we have laid out before the America people as Republicans in the 
Contract With America our ideas of how to do this, and I would just say 
to Secretary Rubin, please, if you do not agree with us, at least 
recognize that the economy is showing signs of slowing, and please 
recognize that we have had seven interest rate increases in the last 
year, and please recognize that we had the largest tax increase to date 
in 1990, surpassed only by another more immense tax increase in 1993, 
and that taxes are at relative high rates and interest rates are 
relatively high, and yet Secretary Rubin does not worry about out Tax 
Code inhibiting savings investment and economic growth. He apparently 
does not want us to make changes to put in place tax policy proven to 
promote economic growth and savings.
  Today our Tax Code and other Government policies promote dependence 
in my view on government and retard economic growth. Let me just point 
to a couple of examples.
  Last week the Joint Economic Committee held a hearing here on the 
minimum wage and whether or not it should be increased as President 
Clinton has suggested. One of the things that we pointed out in that, 
and I will conclude with this, as to how government policy can promote 
dependence, is that $1 out of every $4.25, which is the minimum wage, 
comes to the Federal Government in terms of taxes. If that is in fact 
the case, it simply makes more sense for people of remain unemployed or 
go on welfare. These are the kinds of policies that we need to address 
as Republicans and Democrats with Secretary Rubin's help.


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