[Congressional Record Volume 147, Number 149 (Thursday, November 1, 2001)]
[Senate]
[Pages S11351-S11354]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE STIMULUS PACKAGE
Mr. DURBIN. Mr. President, yesterday and the day before, there were
some statements made in Washington that I would like to reflect on for
a moment.
Yesterday, the President of the United States came before a group--I
am not sure of the name of the group--and said to them at one point, in
reflection on the economic stimulus package, that it was time for
``Congress to get to work.
I understand the President is prodding us to do our best and to work
hard, and we should. But I would say to the President and to any who
follow this that Congress has been working, and working hard, with this
President since September 11, and before. Since September 11, we have
been diligent every time the President has asked us for important
legislation, whether it was the money he needed to execute
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this war against terrorism or the new authority he needed to execute
that war or aviation security. The Senate passed that bill almost 3
weeks ago now by a vote of 100-0.
That was antiterrorism legislation which the President needed so that
our law enforcement can ferret out the sources of terrorism in the
United States. We moved to that quickly and sent it to the his desk.
The Senate and the House have responded and have been working with the
President in a bipartisan fashion.
I found his remarks about the economic stimulus package a little
puzzling because we have been doing our business. It is true that we
have not reported out an economic stimulus bill in the Senate yet. My
guess is we will do that as soon as next week.
The House of Representatives has presented a bill called an economic
stimulus package.
What did the Secretary of the Treasury, a member of President Bush's
Cabinet, say about the House economic stimulus bill? In the words of
Treasury Secretary Paul O'Neill, he called it ``show business.''
Across the United States, in publications as conservative as the Wall
Street Journal and others of a more moderate and liberal bent, the
House effort at an economic stimulus has been roundly criticized.
All of us understand that the American economy is in a sorry state.
The report back just recently suggests that in the third quarter of
this year the U.S. economy contracted by .4 percent. After we have
enjoyed in the last several years 2 and 3-percent growth, it is
troubling to see that we are moving backward. Many believe that the
actual contraction of the economy and movement toward recession will
continue in the fourth quarter. It is almost inevitable when you
consider all of the layoffs, the overcapacity of our economy, and the
current state of our economic indicators.
That is why it was equally troubling when the same Treasury
Secretary, Paul O'Neill, came before the cameras yesterday here in
Washington and made a pronouncement. He said if Congress could pass an
economic stimulus package, we might be able to avoid a recession.
I think Harry Truman made it very clear when he was President. He put
the sign on his desk that said in many respects the buck stops at the
White House; the buck stops with the administration. If this is an
effort by a Cabinet member of this administration suggesting the
recession is a product of congressional inactivity, I think that
simplifies and perhaps overstates their position.
So I hope we can reflect for a moment on what this economy needs and
what has been proposed. We ought to put it in this perspective: Since
September 11, the money we have been spending to execute the war
against terrorism, to rebuild the damage caused by terrorists on that
day, and the money that we are proposing to spend on an economic
stimulus to get America's economy moving forward is money that is being
taken out of the Social Security trust fund and the Medicare trust
fund.
Those of us who voted for it understood full well that in time of war
we need to give the men and women in uniform the resources they need in
order to protect themselves and defend America. I voted for it,
understanding that money was coming out of the Social Security trust
fund. It is to be repaid, but the money is coming out of that trust
fund as we spend it on this war and on rebuilding the damage caused by
terrorism. Similarly, the money being spent on the economic stimulus is
also coming from that Social Security trust fund.
The reason I raise that point is this: How does money get into the
Social Security trust fund? Every worker in America, rich or poor, pays
payroll taxes, known as FICA taxes, every single pay period into the
Social Security and Medicare trust funds. So the money that is building
up in those funds comes from the working people of America. Their
payroll taxes are financing our war effort overseas as well as all the
other efforts to protect America.
The working people of America and their payroll taxes are paying for
the rebuilding of New York and that which was damaged on September 11.
The working people of America and their payroll taxes will pay for any
economic stimulus package which Congress enacts.
The reason why that is significant is twofold. First, as every
economist worth his salt has told us, to get this economy moving again,
you have to put spending power back in the hands of consumers.
Consumers have lost confidence. In losing confidence, they are not
making key purchases. So there is an overcapacity of production, and
people are not buying enough. They are holding back.
The reasons are many. They are uncertain about the economy. They are
uncertain about their jobs. They are uncertain about America's
security. They are holding back. And this reticence on the part of
Americans has led to the slowdown in the economy.
The same economists say, if you want to turn this economy around, you
have to give the resources back to the people who will spend it: the
consumers who need the money in hand to make the purchases to get the
economy fired up and moving forward. I have not heard a credible
economist yet not reach that conclusion.
I pulled a group of business leaders together in Chicago several
weeks ago. We had representatives of labor and business, small and
large, and we sat down. I said, open ended, what do we need to do to
get America moving again? They all came to that conclusion: Give the
consumer more spending power.
Second, they said: Do it in a timely fashion. If Congress should
decide not to do it, or put it off, then, frankly, we are going to be
in a position where it does not make much difference.
Third, they said: Make certain it is temporary, that whatever you do
is focused on resuscitating this economy, and it isn't a long-term
commitment. I thought those were pretty sound principles.
We should consider not just what is most efficient and efficacious in
terms of moving the economy forward, but, secondly, what is fair? If
the money we are spending on an economic stimulus is coming from the
working families in America, out of their payroll taxes, isn't it fair,
in light of that first observation about what is needed for the
economy, that the money be at least returned to working families across
America?
I think that is eminently sensible. But look at what the House of
Representatives comes up with by way of an economic stimulus. They come
up with a proposal that takes the payroll taxes paid into the Social
Security trust fund and redistributes them to whom? The wealthiest
people in America. Forty percent of the economic stimulus coming out of
the Republican-controlled House of Representatives goes to the top 1
percent of wage earners.
Think about ``Reverse Robin Hood.'' Here we have the average person
working hard, paying 7.5 or 8 percent in payroll taxes out of every
single paycheck sent to Washington so that the Ways and Means Committee
in the House of Representatives can take that money and give it to
whom? Not back to the same workers--no--but to the wealthiest people in
America.
What is even worse is a proposal coming out of the House of
Representatives in the name of economic stimulus which would, in fact,
literally give back billions of dollars to corporations for taxes they
paid as long as 15 years ago. That, to me, is an outrage.
That money coming out of the Social Security trust fund will go to
wealthy, prosperous, and profitable corporations to reimburse them for
taxes that were paid as long as 15 years ago. That does not make sense.
It does not make sense from an economic viewpoint if we accept the
premise that we need to give consumers spending power to get this
economy moving forward, and it certainly does not make sense in the
name of justice that we would take payroll taxes and give them back to
wealthy people in America and profitable corporations. That is exactly
what the House of Representatives has proposed. And it is exactly what
Treasury Secretary Paul O'Neill called ``show business.'' I think he
was too kind. I could come up with a few other ways to describe it.
It is far more important for us, as part of an economic stimulus, to
get to the root cause of our economic problem, to address it in a
timely fashion,
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to avoid, as much as possible, long-term deficits, and to make certain
this is a temporary fix that really resuscitates the economy, as it
needs to be.
Currently, the Senate Finance Committee, under the leadership of
Senator Max Baucus, is considering a stimulus package. This package is
good in many respects. All the tax and spending proposals are temporary
in nature. More than 100 percent of the 10-year cost occurs in the year
2002--immediately.
The bill costs $70 billion this year and $40 billion more over 10
years. It includes a $14 billion rebate and $33 billion in worker
relief, targeted to low and middle-income Americans who are more likely
to spend it. And it has virtually no effect on the surplus after this
next fiscal year.
Contrast that with the proposal that we now have from the Senate
Republicans, from Senator Grassley of Iowa. Senator Grassley's proposal
has $143 billion in tax cuts that are permanent, not temporary but
permanent, representing 82 percent of the total net cost of the
Republican economic stimulus package. Nearly 48 percent of the 10-year
cost of the package occurs after the first year. So it is not a
stimulus package. Almost half of it does not occur until a year from
now.
The bill costs $78 billion in fiscal year 2003 and $60 billion in
fiscal year 2004. The bill costs $91 billion in this next fiscal year
and $175 billion over 10 years--$175 billion in comparison to the $70
billion cost of the bill that is coming out of the Democratic side.
Listen to this part. Remember, the money we are talking about comes
out of the Social Security and Medicare trust funds from payroll taxes
paid by working families across America. That is what is providing the
money. That is the source of the money.
What would the Republican Senators have us do with that money from
these workers? Forty-four percent of the Republican tax cuts would go
to the wealthiest 1 percent of taxpayers. Only 18 percent of the total
amount of economic stimulus goes to the bottom 60 percent of employees
and taxpayers across America.
From where I am standing, this does not make any sense at all. This,
by any standard, is a failing proposal on the Republican side. For the
President to say to us, it is time for Congress to get to work, it is
also time for this administration to stand up behind sound economic
principles that really will move this economy forward, and do it in a
fashion that is fair--fair to every American.
We had a meeting yesterday with some friends and representatives of
working people across America, and a point was made very effectively:
When it comes to waging wars in America, the working families are
usually the first in line, not just with their tax payments but with
their sons and daughters who serve our Nation so well, so valiantly.
Isn't it nothing short of amazing that when it comes to stimulating the
economy of this country that we forget that lesson?
Since September 11, everywhere you turn, you see the phrase ``United
we stand.'' And thank God for it, that this country has come together
in a spirit of patriotism and community and togetherness in a way I
have never seen in my natural life. But when you look at these bills
that have been proposed on the Republican side of the House and Senate
for stimulating the economy, it is not motivated by the motto ``United
we stand.''
It is motivated by the motto ``divided we stimulate.'' When it comes
to putting money back in the economy, these proposals turn their back
on the same people paying the payroll taxes, the very same people
making the sacrifice over and over again, day in and day out in
America.
Senator Tom Daschle is majority leader. He has said, as part of our
economic stimulus, there are several things we should do. I will refer
to a couple of them.
One of the actions needed, and I certainly agree with this, is to
extend the unemployment insurance available to workers across America.
This temporary extension and expansion of unemployment insurance is not
unprecedented. In fact, former President George Bush, at a time of
recession in America, called for the extension of unemployment
insurance benefits. Unfortunately, his son, now President of the United
States, has not made the same commitment in terms of the number of
people to be helped, how much they would be helped, and how quickly the
assistance would be available.
By allowing 13 weeks of extended benefits to anyone with benefits
expiring after September 11, we are saying to families: We are going to
give you the safety net, the helping hand. What is unemployment
insurance worth if you have lost your job? About $230 a week. That is
the average. It is not enough for a person to live in the lap of
luxury. It is enough for some families to squeak by using their
savings, cutting corners, and trying to get by.
There is also a proposal that we help these same families who have
lost their jobs and are on unemployment insurance to pay for health
insurance. Imagine that you have lost a job you have held for a number
of years--and that has happened to hundreds of thousands of Americans
in the last year--that you are now trying to keep your family together
with unemployment checks of about $230 a week, and when you try to buy
the health insurance your family now needs in the private marketplace,
it costs you $500 to $700 a month. Those figures are not outlandish;
they represent the average.
So it is not a surprise to many that the unemployed people drop their
health insurance, which, of course, causes a great deal of worry over
the coverage of the family and, in the worst-case scenario, pushes
these uninsured, unemployed Americans into a health care system which
is forced to absorb them in charity payments.
We believe, on the Democratic side, that in addition to extending
unemployment insurance, we should also extend coverage for health care
benefits for those unemployed workers. That is sensible. It gives them
the peace of mind and protection they need for their families.
Senator Daschle has said that will be an essential part of any
economic stimulus package that comes out of the Democratic side of the
Senate.
These are reasonable and responsible things to do. We have
traditionally committed ourselves to small business, and that
commitment could be realized as part of the economic stimulus package
in terms of allowing some bonus depreciation, some expensing, so that
there can be purchases made that help businesses and that will help
those who supply them. That is sensible.
This small business approach costs a great deal less than what has
been proposed in the House of Representatives, which rewards some of
the largest corporations in America.
That is what we face in terms of an economic stimulus package on the
tax side. Our colleague in the Senate, Mr. Robert Byrd, has suggested
that in addition to the $70 billion as part of our tax package, that we
also put in about $20 billion in spending. Some will say: There they go
again. At a time of national emergency, they are making proposals to
spend more Federal money.
Before you reach that conclusion, take a look at what Senator Byrd
has proposed, cosponsored by Senator Harry Reid of Nevada. The proposal
is to provide additional funds to Federal, State, and local
antiterrorism law enforcement. We just had a meeting of our homeland
defense coordinator for the State of Illinois, Matt Battenhausen, and
our bipartisan delegation to talk about the urgent need to create a
communications system in our State of Illinois and many other States so
that police departments and fire departments can be in communication in
time of need. That seems very basic to me.
Senators Byrd and Reid, in this spending proposal for homeland
defense, would provide resources for that opportunity. The FEMA
firefighters grant program is another program that has provided for an
update in the equipment and resources and materials at fire stations
all across America. It has been an extremely popular program. They have
called for $600 million on that. I am certain that could be used very
effectively, if for no other reason than to give local firefighters
some familiarity with dealing with hazardous materials and the threat
of bioterrorism. That is something that is absolutely essential.
When it comes to infrastructure security, highway security, and clean
and safe drinking water, if you think
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about this, we have made it clear that we not only should focus on
aviation security and airport security but on all transportation.
Investing money now to protect those resources is going to thwart any
efforts by terrorists to turn them against us.
There is money included as well for bioterrorism prevention and
response and food safety. This is an issue about which I feel strongly.
We need to put the resources into bioterrorism.
Today, we had a presentation to many Democratic Senators from Dr.
Anthony Fauci, who is with the National Institutes of Health. He talked
to us about anthrax, with which we have become increasingly familiar on
Capitol Hill because of the threats against our Senators, as well as
the many people who work and visit here.
It is clear to me there are things we absolutely essentially have to
do to protect America. How will they get done? How can we make this
difference? We certainly can't make the difference unless we are
prepared to provide money to those units of government and others that
need it to protect us against bioterrorism. Border security, $1.6
billion: Would anyone argue against the idea of putting more people on
the borders to make certain that those who have a suspicious background
or involvement in terrorism cannot get into the United States?
Mass transit, Amtrak, and airport security: all of these are easily
defensible and suggest that there will be money spent for good purposes
to protect and defend America and at the same time to invigorate this
economy.
It is a very positive combination to take the tax benefits being
offered by Senator Baucus's bill as well as the homeland defense
spending that has been suggested by Senator Byrd. Coming together, it
will not only help the economy; it will make America a safer place.
We can say to the working families across America who pay the payroll
taxes that are being spent through the Social Security trust fund that
the money is being spent for their purposes to help them, to help this
economy, to turn America around.
The President has said it is time for Congress to get to work. I
accept the challenge. I think it is also time for the administration to
get to work, for them to reject the show business, as Secretary O'Neill
has called the Republican bill that is before us, and to come forward
with a more sensible and responsible and manageable approach. If the
President will step up and with his leadership create a bipartisan
coalition for an economic stimulus that is truly in the best interest
of America, I guarantee him this: The same spirit of bipartisanship we
have seen in Washington for the last 7 weeks will continue in this
important chapter of America's history as well, as we respond to this
recession with a positive program, a program that will truly help
America get back on its feet.
That is the challenge before us. I certainly hope as the Senate
Finance Committee brings its bill to the floor and searches out 60
Senators in support of it, it will be a bipartisan bill. If we are
going to be asked to accept without change, take it or leave it, the
proposal on the Republican side to provide most of the benefits for the
wealthiest people in this country and for the wealthiest corporations,
it should be summarily rejected.
As Secretary of the Treasury O'Neil said: The Republican version
coming out of the House is a bad idea. It would be a bad idea coming
out of the Senate as well.
I could not in good conscience support a bill in the name of economic
stimulus which takes money from the Social Security and Medicare trust
funds and spends it; instead of creating an economic incentive, it
spends it instead on benefits for those who are frankly very well off
and not very pained in today's economy.
The PRESIDING OFFICER (Mr. Wellstone). The Senator from Illinois.
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