[Congressional Record Volume 145, Number 67 (Tuesday, May 11, 1999)]
[House]
[Pages H2964-H2965]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     TRANSITIONING TO A NEW ECONOMY

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Washington (Mr. Smith) is recognized for 5 minutes.
  Mr. SMITH of Washington. Mr. Speaker, I rise today to talk a little 
bit about our new economy, the information-based economy, and all the 
transitions that have been happening during this decade and really 
since about the mid-1970s and into the 1980s.
  It has been a dramatic change, one of the largest changes arguably in 
human history in terms of the direction of our country; and it has been 
shifted towards a new economy, based primarily on technology and 
information. And one of the most important challenges that we in this 
body will face in the years ahead is adjusting to that, is figuring out 
how to understand how our economy has changed and, as a consequence, 
how we need to change to embrace that.
  One of the biggest arguments that I want to make off the start is 
this is not an option. The new economy is not something that we can 
choose to opt in or opt out of. It is a fact of life, and we need to be 
prepared to adjust to it. And there are some policies that we can 
adopt.
  But, more than anything, right up front we need to increase our 
knowledge as policymakers, I urge all Members of Congress to do this, 
of the changes that have occurred in our economy that have moved it 
more toward a high-tech economy, and what changes do we need to make as 
policymakers to address that.
  I would like to lay out five broad categories today and just say 
that, as a member of the New Democratic Coalition on the Democratic 
side of the House, we are working very closely on these issues, working 
with leaders in the technology field, leaders in the education field to 
try to make the policy changes that are necessary because I think it is 
critical that we address those.
  The biggest one, of course, is education. We need to shift our 
education systems from K-12 to beyond to embrace the idea of life-long 
learning and the importance of technology. The three R's are still 
absolutely necessary. But if they do not have some knowledge in there 
about computers as well, they are going to be left behind in the new 
economy, and we need to make sure that that is included.
  We need to make sure that people understand that the world has 
changed, they are not simply going to be able to get through high 
school and then move into a job and never have to update their skills. 
They are going to have to be willing to constantly update their skills, 
and we in government are going to have to provide the access to the 
updating of those skills, whether it is Voc, higher education of any 
kind, retraining on the job. We need to create those incentives.
  But at the beginning, at the front, before we get to that, we need to 
change our K-12 system to make it more aware of the needs of technology 
and of the need of teaching kids how to learn and how to learn for 
life.
  Secondly, we have to invest in research and we have to give our 
companies in this country the incentive to make those investments.
  An important issue is going to come through Congress at some point 
this session that would permanently extend the R&D tax credit. That 
will have a critical impact on our economy. Research and development is 
absolutely necessary to keep up with the break-through technologies 
that seem to be happening on a daily basis. We need to give our 
companies the incentives to make those investments.
  Currently, we only offer the R&D tax credit for one year and then we 
play this game of roulette in the next year

[[Page H2965]]

as to whether or not we are going to let it go on from there. Companies 
cannot plan in that sort of an environment. They do not know whether or 
not they are going to have the money to do the research over the long 
haul. We need to make that permanent.
  Third, we need to build the technology structure. This is about 
broad-band communication, giving people access to the Internet. The 
Internet has the ability to be the greatest equalizer of all time in 
terms of knowledge. It is not going to divide us. It is going to give 
anybody with a PC and a link to their phone line to get to the Internet 
the ability to gather knowledge which they never would have had access 
to before. But we have got to give companies the incentive to build 
that infrastructure so that people will get that access.
  This means deregulation and allowing that competition to flow so that 
we will build the infrastructure and get access to the Internet beyond 
just the urban areas which have it now and out into the rural and 
suburban areas where it is desperately needed.
  Fourth, we need to leave the Internet alone. Overregulating the 
Internet can potentially strangle its ability to get that information 
out there and help companies grow. Too much regulation would be a very 
bad thing, and we need to leave the Internet alone and not overregulate 
it.

                              {time}  1900

  Lastly, we need to increase exports. We need to get access to more 
markets. Ninety-six percent of the people in the world live someplace 
other than the United States. If we are going to increase markets for 
all goods, we are going to have to do it overseas.
  I want to emphasize that this is not limited to certain technology 
areas, the Silicon Valley or Seattle or the research triangle or 
Boston. Any company one can think of is affected by technology.
  We just heard today that we had another 4 percent increase in 
productivity this last quarter. That is driven almost exclusively by 
advances in technology and helps grow the economy everywhere. 
Regardless of what business you are in, technology can help make that 
business more productive, help make our economy stronger and, most 
importantly, help people get and keep good jobs that will enable them 
to raise their family and take care of their bills and obligations. We 
must embrace the new economy and the high-tech economy so that we can 
prepare for the future.

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