[Congressional Record Volume 141, Number 137 (Wednesday, September 6, 1995)]
[House]
[Pages H8586-H8587]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                              {time}  1900
                         THE COMING TRAIN WRECK

  The SPEAKER pro tempore (Mr. Chambliss). Under the Speaker's 
announced policy of May 12, 1995, the gentleman from New York [Mr. 
Owens] is recognized for 60 minutes as the designee of the minority 
leader.
  Mr. OWENS. Mr. Speaker, I will use no more than half of the 60 
minutes allotted.
  I realize that we are in a transition period and moving from a 
district work period to a capital work period is a bit of a strain, and 
we want to take it slow. So I will not go on at great length today.
  But I do think we should note the fact that serious business lies 
ahead of us. There has been a great deal of talk about a train wreck 
coming where the mean and extreme balanced budget philosophy of the 
Republican majority will clash with the more moderate reform approach 
of the President, and we are going to have some very difficult days.
  I think it is quite clear that appropriations bills of the kind that 
we passed before we left here cannot be left standing. We cannot have a 
$9 billion cut in education, job training and social services. We 
cannot have tremendous cuts in housing. There are a number of things 
that just cannot be left standing. We cannot tolerate more than $280 
billion in cuts over the next 7 years to Medicare. We cannot tolerate 
more than $180 billion in cuts for Medicaid.
  There has to be a train wreck.
  Unfortunately, in the Congress, in the Senate and the House, the 
Republican majority has the votes, and they have passed this mean and 
extreme program. All we have left is a Democratic President who says 
that he will veto these programs, and then we have a situation where 
the government may be brought to a halt if the appropriations bills are 
not signed and the Republican majority of the Congress is not willing 
to pass a continuing resolution to keep the government going.
  It is going to be exciting times. But we should all realize that the 
basic direction for the Naiton is being shaped not only in the next few 
months but it is already in the process; the direction that this Nation 
will take is already being shaped faster than we think, and what 
happens this year we will have to live with, this year and next year, 
for a long time to come.
  It is very important that everybody understands that radical changes 
are under way. They are being proposed, ever more mean and radical 
changes. But radical changes are under way right now.
  The great majority of Americans feel that something is very 
different, that there is something happening. The great majority feels 
some aspect of this change. But they do not understand it.
  So the majority of the people are angry, and they do not know why 
they are angry. I am here to tell you you have good reason to be angry. 
The problem in America is that we have to learn who to be angry with 
and how to focus our anger. Where is the problem?
  I hope that everyone will take time to read an article that appeared 
in the New York Times on last Sunday, September 3. It is an article 
that appeared on the op ed page. It was entitled ``Companies Merge, 
Families Break Up.'' ``Companies Merge, Families Break Up.''
  The article is by Lester Thurow. Lester Thurow is an outstanding 
economist, recognized all over the world. He is a professor of 
economics at the Massachusetts Institute of Technology. On the Hill 
here in this capital we have seen and heard Lester Thurow many times 
over the last two decades.
                              {time}  1930

  It is our business to rein in the resources of the country, wherever 
they may appear, and apply them to the problems that we face.
  To get back to Mr. Thurow:

       American companies are moving production overseas, using 
     technology to replace workers, engaging in mega mergers, such 
     as this week's Chase-Chemical deal, and otherwise downsizing. 
     Each year more than half a million good jobs are eliminated 
     by the Nation's most prestigious companies. More new jobs are 
     being generated in the service sector, but they come with 
     lower wages and fewer fringe benefits.

  With the death of communism and later market socialism and economic 
alternatives, capitalists have been able to employ more ruthless 
approaches to getting more for less, to getting maximum profits but 
with less effort. They do not have to worry about political pressure. 
Survival of the fittest capitalism is on the march.
  What other kind of capitalism can we have except survival of the 
fittest capitalism. And that is appropriate for capitalism to be a 
survival of the fittest operation. It is up to government to deal with 
what the implications of that is.

       Falling real wages have put the traditional American family 
     into play. As the one-earner middle class family becomes 
     extinct, with children needing ever more costly educations 
     for ever longer periods of time, the cost of supporting a 
     family is rising sharply just as earnings plunge.
       Children exist, but no one takes care of them. Parents are 
     spending 40 percent less time with their children than they 
     did 30 years ago. More than 2 million children under the age 
     of 13 have no adult supervision either before or after 
     school. Paying for day care would use up all or most of a 
     mother's wages.

  The traditional family is being destroyed. This is an economist named 
Lester Thurow, who has written 10 or 20 books, professor of economics 
at the Massachusetts Institute of Technology. He is talking about the 
economy and the impact of the economy on the family. We hear a lot of 
talk about family but we do not acknowledge the fact that the economy 
and what happens in the economy, what happens with wages, what happens 
with jobs has a very serious impact, the most serious impact on 
families. In fact, Mr. Thurow is about to say that.
  Returning to the article:

       The traditional family is being destroyed not by misguided 
     social welfare programs coming from Washington, although 
     there are some government initiatives that have undermined 
     family structure, but by a modern economic system that is not 
     congruent with family values.

  The traditional family is being destroyed not by misguided social 
welfare programs coming from Washington, but by a modern economic 
system that is not congruent with family values. When we look at 
falling wages as a factor:

       Beside falling wages, America's other economic problems 
     pale into insignificance. The remedies lie in major public 
     and private investments, in research and development, and in 
     creating skilled workers to ensure that tomorrow's high-wage 
     brainpower industries generate much of their employment in 
     the United States. Yet if one looks at the weak policy 
     proposals of both Democrats and Republicans, it is a tale 
     told by an idiot, full of sound and fury, signifying nothing.

  That is in quotes. As we all know, it is from Shakespeare that Mr. 
Thurow is quoting. It is that the Democratic and Republican policies at 
this present point, which focus on this problem, that constitute a tale 
told by an idiot, full of sound and fury, signifying nothing.
  We just passed legislation which refused to continue the Office of 
Technology Assessment. The Office of Technology Assessment is a basic 
tool very much needed by the Members of Congress, Members of the House 
and Members of the Senate. We just threw it out. The one thing that was 
most significant got axed. We will be passing an appropriations bill 
for defense in the next few days and we are going to have a B-2 bomber 
vote again. If past history is any guide, we know that the B-2 bomber, 
which the Pentagon does not want, and the President does not want, and 
the Air Force does not want, it will probably pass again. The most 
unneeded piece of technology around will pass with votes from the 
House.
  That is the kind of thing we are in. When they say what we do and 
what we say is a tale told by idiots, full of sound and fury, 
signifying nothing, that is what they mean.
  The American people should be angry about all this. Revenue policies 
are needed to deal with the present problem. We need taxing policies to 
take the
 resources from where they are, the revenues in Wall Street, the 
revenues 

[[Page H 8587]]
that are in the high prices of corporations, we need to take some of 
those revenues and put them into research and development and into 
training workers.

  Mr. Speaker, we have a transition period here, a period which will go 
on for some time still to come where these great downsizings will make 
more people unemployed. Something needs to be done during this 
transitional period. Nobody knows where capitalism will go. It is not 
planned. No one wants to stop progress, but you need to take some steps 
to deal with it, and one of the steps that should be taken is to 
balance the tax burden by taking more revenue from corporations.
  Corporations now pay only 11 percent of the total tax burden. 
Individuals are paying 44 percent. That is ridiculous. We need to bring 
down taxes for individuals and raise taxes on corporations to get 
enough revenue to sustain the programs that need to be sustained for 
education and for job training.
  Mr. Speaker, I am rushing, because I do not want to take too much 
time today. We will expand on this in the future. We need a creative 
revenue commission, a commission similar to the base closings 
commission, which will look at the revenue situation, look at the fact 
that over the years corporations have gone down from paying almost 40 
percent of the tax burden to paying now only 11 percent of the tax 
burden. At one point, under Ronald Reagan, it went down to 8 percent of 
the total tax burden.
  The Committee on Ways and Means has swindled the country. The 
Committee on Ways and Means, part of this body, and other taxing 
authorities, have allowed a situation to be created where the burden is 
very lopsided. One of the things that a tax commission could do is find 
ways to raise the taxes on corporations, pull out more revenue from 
corporations while you are lowering families and individuals, and use 
the money that you get to pour it into education, research and 
development, and job training.
  I am going to end at this point, Mr. Speaker. There are a lot of 
proposals on the board: Flat tax proposals, consumption tax proposals, 
various proposals that are on the drawing board for such a commission 
to examine. I would want to add to that an anti-monopoly tax, where any 
industry which gets more than 25 percent of the market would have to 
pay a surcharge because it has an advantage that does not need as great 
an expenditure.
  I would also add that something should be done about the banking and 
financial industry, to recapture the almost $300 billion that the 
American taxpayers have put out through the Federal deposit insurance 
to bail out the savings and loan associations. All of the industries in 
the banking field and related financial institutions ought to have a 
surcharge put on them to collect back some of that money. There are a 
number of creative propositions by which we could get more revenue 
instead of focusing only on cuts.
  Yes, we should downsize government; yes, there is waste, but there is 
a great problem. We need to balance the tax burden at the same time 
that we are trying to balance the budget. In doing that, we will 
produce a situation where the workers of America, the children of 
America, the families of America would have more to look forward to in 
terms of facing these tremendous radical changes that are presently 
taking place in our economy and our society.
  The material previously referred to is as follows:
                [From the New York Times, Sept. 3, 1995]

                   Companies Merge, Families Break Up

                         (By Lester C. Thurow)

       No country without a revolution or a military defeat and 
     subsequent occupation has ever experienced such a sharp shift 
     in the distribution of earnings as America has in the last 
     generation. At no other time have median wages of American 
     men fallen for more than two decades. Never before have a 
     majority of American workers suffered real wage reductions 
     while the per capita domestic product was advancing.
       So on Labor Day this year, as with a lot of Labor Days, 
     most laborers don't have a lot to celebrate. The median real 
     wage for full-time male workers has fallen from $34,048 in 
     1973 to $30,407 in 1993.
       Wages of white men are falling slightly faster than those 
     of black men, and the young have been clobbered; wages are 
     down 25 percent for men 25 to 34 years of age. Median wages 
     for women didn't start to fall until 1989, but are now 
     falling for every group except college-educated women. The 
     pace of decline seems to have doubled in 1994 and early 1995.
       The tide rose (the real per capita gross domestic product 
     went up 29 percent between 1973 and 1993), but 80 percent of 
     the boats sank. Among men, the top 20 percent of the labor 
     force has been winning all of the country's wage increases 
     for more than two decades.
       Adding to the frustrations, the old remedy for lower 
     wages--more education--no longer works. True, wages of males 
     with only a high school education are falling faster than the 
     pay of those with college degrees. But investing in a college 
     education doesn't get one off the down escalator and onto an 
     up escalator--it merely slows one's descent.
       No one knows exactly how much of the decline can be traced 
     to any particular cause, but we do know the set of causes 
     that has been responsible
       New production and distribution technologies require a much 
     better educated work force. If decisions are to be pushed 
     down the corporate hierarchy, those at lower levels have to 
     have skills and competency beyond what was required in the 
     past.
       With our global economy, where anything can be made 
     anywhere and sold everywhere, the supply of cheap, often 
     well-educated labor in the third world is having a big effect 
     on first-world wages. One month's wages for a Seattle 
     software engineer get the same company an equally good 
     engineer in Banagalor, India, for a year. Ten million 
     immigrants entered the United States during the last decade, 
     competing for jobs and lowering wages.
       American companies are moving production overseas, using 
     new technology
      to replace workers, engaging in mega-mergers such as this 
     week's Chase-Chemical deal, and otherwise downsizing. Each 
     year more than a half-million good jobs are eliminated by 
     the nation's most prestigious companies. More new jobs are 
     being generated in the service sector, but they come with 
     lower wages and fewer fringe benefits.
       With the death of Communism and, later, market socialism as 
     economic alternatives, capitalists have been able to employ 
     more ruthless approaches to getting maximum profits without 
     worrying about political pressure. ``Survival of the 
     fittest'' capitalism is on the march.
       What economists call ``efficiency wages'' (a company paying 
     higher salaries than the minimum it needs to pay, so that it 
     gets a skilled, cooperative, loyal work force) are 
     disappearing to be replaced by a different form of 
     motivation--the fear of losing one's job.
       Falling real wages have put the traditional American family 
     into play, as the one-earner middle-class family becomes 
     extinct. With children needing ever-more-costly educations 
     for ever-longer periods of time, the cost of supporting a 
     family is rising sharply just as earnings plunge.
       Thirty-two percent of all men between 25 and 34 years of 
     age earn less than the amount necessary to keep a family of 
     four above the poverty line. Mothers have to work longer 
     hours if the family is to have its old standard of living.
       Children exist but no one takes care of them. Parents are 
     spending 40 percent less time with their children than they 
     did 30 years ago. More than two million children under the 
     age of 13 have no adult supervision either before or after 
     school. Paying for day care would use up all or most of a 
     mother's wages.
       In the agricultural era, children had real economic value 
     at a very early age. Students who use college loans owe their 
     parents less. Living thousands of miles apart, families lose 
     track of one another. The family is no longer the social 
     welfare system when one is disabled, old or sick, and it will 
     not resume these duties even if the state were to withdraw.
       The traditional family is being destroyed not by misguided 
     social welfare programs coming from Washington (although 
     there are some Government initiatives that have undermined 
     family structure) but by a modern economic system that is not 
     congruent with ``family values.''
       Beside falling real wages, America's other economic 
     problems pale into insignificance. The remedies lie in major 
     public and private investments in research and development 
     and in creating skilled workers to insure that tomorrow's 
     high-wage, brain-power industries generate much of their 
     employment in the United States.
       Yet if one looks at the weak policy proposals of both 
     Democrats and Republicans, ``it is a tale, told by an idiot, 
     full of sound and fury, signifying nothing.''
     

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