[Congressional Record Volume 148, Number 25 (Friday, March 8, 2002)]
[Senate]
[Page S1694]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          THE STIMULUS PACKAGE

  Mr. DODD. Madam President, I will not take more than 10 minutes. I 
see my colleague from New Hampshire here as well. I voted against the 
so-called stimulus package a few moments ago. I didn't have a chance 
before the vote occurred to explain why I was going to cast that 
ballot, voting no.
  Obviously, there are provisions that I strongly endorse and support, 
including: The extension of unemployment benefits; teacher expenses 
which is an item we argued about a number of years ago that I thought 
would be very worthwhile; and the New York recovery package--certainly 
I would like to see us do what we can to help New York City as a result 
of what happened September 11.
  If those were the only issues, this would have been an easy vote. 
They were not the only issues. In fact, they were minor issues by 
comparison to what else was included in this package. Based on whatever 
estimates you want to rely on, at least over the next 10 years, there 
are $42 billion in revenue losses to the Federal Treasury.
  Yesterday, the Presiding Officer, I, and others who sit on the Senate 
Banking Committee had the pleasure of listening to the Chairman of the 
Federal Reserve Board say their analysis at the Federal Reserve was 
that we are on our way out of this recession. The worrisome figures 
that indicated this recession could be deeper or be a double-dip 
recession apparently will not bear out. The country is getting 
stronger, the economy is getting much stronger.
  While there may have been a strong case for this bill that just went 
through by 85-9--it is becoming the law of the land--and a strong case 
could have been made for it 2 or 3 years ago or even a number of months 
ago, but I do not think the case could be made for it today. Using the 
most conservative number, the $42 billion, that is $42 billion more to 
the deficits with which we are grappling, which according to the CBO, 
may be $120 billion in this coming fiscal year. The administration had 
initially said $80 billion. We are now told that over 10 years it is 
$1.8 trillion.
  Well, $42 billion in a $1.8 trillion deficit may not sound like much, 
but it is when we are trying to see if we can do more, for instance, 
with the Securities and Exchange Commission, where we need maybe $100 
million to $200 million to beef up enforcement and accounting divisions 
to deal with an Enron-type situation. It is a lot when we know, as a 
result of increasing the workload of working mothers, we need 
additional funding for child care, that we ought to do more on the 
child abuse treatment and prevention programs--to mention a couple. In 
transportation, we have an $8.6 billion shortfall. I don't know a 
section of the country that will not be hurt by that budget decision.
  Yet we just took $42 billion off the table this morning by a 85-9 
vote. State budget shortfalls will total more than $42 billion for the 
current fiscal year. A few months ago, we had a stimulus proposal on 
the table that would have included State assistance. The previous House 
version of this bill contained capped assistance for State Medicaid 
Programs and also provided dollars back to the States as a result of 
the revenue losses on the bonus depreciation. My State just lost $240 
million this morning. New York lost more than $2 billion.
  So on one hand we are giving money for relief and providing 
assistance on the September 11 tragedy, yet we will take $2 billion 
away from the State of New York. And again, in my state, this bill is 
taking $240 million! The Governor and others are wrestling with how to 
provide needed resources to our area.

  I mentioned the $8.6 billion deficit reduction in the 
administration's budget for transportation. That is a huge issue in my 
State, as I know it is in the State of the Presiding Officer and 
others. Listen to what we have done and the analysis of this. The most 
expensive component of this bill that we just passed is the 3-year 
bonus depreciation provision that will costs close to $97 billion 
during the next three years, according to the Joint Committee on 
Taxation. The Congressional Budget Office, CBO, a nonpartisan budget 
office, concluded that allowing depreciation bonus for 3 years rather 
than 1 year--which is what we should have done--would sharply reduce 
the effectiveness of this proposal as an economic stimulus. These are 
their words. With a 3-year provision, firms can delay investment until 
well after the economy has recovered. This provision will worsen the 
financial situation in States which are facing cumulative budget 
deficits of more than $42 billion.
  Unlike the last two stimulus bills the House passed and the stimulus 
bill the Senate Finance Committee approved last fall, this bill we 
adopted includes no fiscal assistance whatsoever to States to offset 
the State revenue offices that the depreciation provision would cost.
  As I said, this bill might have been fine 5 months ago, but today it 
is a mistake. The provision calls for 3 years at 30 percent, but the 3-
year period begins on September 11. So all investments since September 
11 will qualify; new investments have to be made by September 10, 2004, 
long after the recession is over. This is overreaching and it goes too 
far. We have to learn to have a sense of balance about these things 
when we take these steps. In 2002, the bonus depreciation provision 
will cost $35 billion. This is unfortunate when I know there are many 
great demands. How do you not have interest rates go up if the deficit 
continues to mount?
  On the net operating loss, I am sympathetic to some of the issues, 
but this provision allows a carryback to 1996--1996, as a stimulus 
package? It is overreaching, way overreaching.
  There is a lot we did not include: There are no health care tax 
provisions. No rebates--the bill drops the $14 billion included 
earlier. No small business expensing. No general increase in small 
business expensing. And no State assistance.
  I know there are provisions that Members did not want to be seen 
voting against, such as extension of unemployment benefits. I know we 
wanted to help out in the case of September 11 and what happened in New 
York. But typically what happens is we list all of these things as if 
they were of equal wait in the budget. They are not.

  We just voted for a huge addition to the fiscal deficit of this 
country at a time when we are struggling to find payments for 
transportation, health care, child care, and education. We have a 2-
percent reduction in the elementary and secondary education accounts, 
and the President's budget. We may change it. We just passed a bill 
with additional reforms for which we are going to have to pay.
  This stimulus bill results in a tax increase for people at the local 
level. Local communities are going to raise taxes. States are going to 
have to raise taxes. We just made, I think, a mistake by voting for 
this so-called stimulus package.
  Those are the reasons I cast a ``no'' vote this morning on that 
proposal.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Pennsylvania.

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