[Congressional Record Volume 142, Number 124 (Wednesday, September 11, 1996)]
[House]
[Page H10199]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    CLINTONOMICS VERSUS REAGANOMICS

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from New York [Mr. Hinchey] is recognized for 5 minutes.
  Mr. HINCHEY. Mr. Speaker, just before the August recess, the Wall 
Street Journal published an op-ed written by economist Alan Reynolds of 
the Hudson Institute.
  That op-ed, entitled ``Clintonomics doesn't measure up,'' urged 
presidential candidate Bob Dole to embrace a return to supply-side 
economics based on what was portrayed as anemic economic growth during 
the past 4 years.
  Reynolds argued that key statistics showed economic performance was 
superior during the supply-side years of President Reagan than it has 
been since President Clinton was elected to office.
  As I read the article, it became clear to me that Mr. Reynolds, a 
long-time advocate for supply-side policies, was not providing 
objective analysis of this situation.
  Calling on the resources of the Joint Economic Committee, of which I 
am a member, I conducted extensive research into Reynolds' economic 
analysis and the statistics he used to make his case.
  I was not surprised to find that the analysis was orchestrated in a 
manner that proved to be generous to the supply-side years and not so 
generous to the Clinton years.
  First, Reynolds conveniently began his analysis in 1983, the third 
year of Reagan's presidency, rather than in 1981, the year in which the 
Reagan tax cut was actually enacted.
  The huge budget deficits resulting from those tax reductions forced 
up interest rates in 1981 and plunged the economy into the deepest 
recession since the Great Depression.
  Unemployment reached almost 11 percent nationally, and the strong 
recovery in the years that followed must be seen from that perspective: 
from that economic nadir, we had nowhere else to go but up.
  In addition, Reynolds also excluded the Bush years from his analysis 
despite the fact that supply-side policies were continued throughout 
that era.
  The Journal recently printed a letter I authored in response to that 
op-ed that included a more complete comparison of economic performance 
since 1992 and that during the full Reagan-Bush 12 years.
  The analysis showed the economy has in fact performed better since 
1993 than it had during the previous 12 years of supply-side economics.
  Under Clinton, the economy has grown more rapidly, employment has 
risen at a faster rate, per capita income has increased more quickly, 
and the deficit is smaller relative to the economy.
  Gross domestic product growth has been 2.5 percent under annually 
since 1992, as opposed to 2.4 percent Reagan-Bush.
  Employment grew at a rate of 2.6 percent each year since 1992, a full 
percentage point higher than in the years from 1981-1992.
  And finally, the deficit has averaged 2.9 percent of the size of the 
economy under Clinton, while it averaged 4.3 percent under Reagan and 
Bush.
  Last month's unemployment rate of 5.1 percent provides further 
evidence of just how healthy the national economy has become in recent 
times.
  Mr. Speaker, I am not arguing that all areas of the Nation have 
experienced equal economic progress during the last 4 years.
  There are areas such as the Hudson Valley and the Southern Tier in my 
State that continue to experience significant economic anxiety and 
widespread underemployment.
  While there is much left to do to help get people to work, even these 
areas have experienced improvements in their local economies since 
1992.
  Mr. Speaker, we owe much of our economic progress to the success of 
the 1993 budget reduction law that was enacted by the Democratic 
Congress.
  It has reduced the deficit by 60 percent, from $290 billion in 1992 
to an estimated $117 billion this year.
  The law has resulted in four straight years of deficit reduction for 
the first time in about 100 years.
  And the deficit this year is expected to be at its smallest size 
relative to the economy since 1974.
  In addition to the historic deficit reduction which has occurred, the 
law also significantly expanded the EITC program providing tax cuts to 
families earning less than $28,000 annually.
  According to the U.S. Department of Treasury, in my congressional 
district, an estimated 31,974 working families have received tax breaks 
averaging $480 this year due to the expansion of the EITC.
  By any measure then, whether it is economic performance, deficit 
reduction, or tax relief to working families, the 1993 budget law has 
been a great success.
  Despite all of these positive statistics on economic performance that 
were included in my Wall Street Journal piece, I am disappointed to say 
that I was not successful in convincing GOP candidate Bob Dole that a 
return to supply-side economics would be unwise.
  Last month, Dole released his $550 billion tax plan with breaks 
targeted to only the wealthiest families in our Nation, and paid for by 
a magical economic growth dividend.
  This morning, Senator Dole held meetings in the House of 
Representatives to peddle his supply-side economic plan to reluctant 
Republican Members of this body.
  The American people must know that history speaks for itself on 
supply-side economics: the Dole plan will bankrupt our Nation, 
undermine economic growth, and increase worker unemployment.
  It is time that we pay tribute to the 1993 budget law which has been 
a tremendous success in reviving the economy and creating good, decent-
paying jobs for millions of Americans.

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