[Congressional Record Volume 148, Number 126 (Tuesday, October 1, 2002)]
[Senate]
[Pages S9655-S9657]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   DEMOCRATIC LEADERSHIP'S ATTACK ON PRESIDENT BUSH'S FISCAL POLICIES

  Mr. GRASSLEY. Mr. President, I want to respond to what has been a 
coordinated attack by the Democratic leadership on President Bush. This 
drumbeat, as we all know, started a couple of weeks ago. Our 
distinguished majority leader, Senator Daschle, took the lead on a 
Senate floor speech to question the leadership of President Bush. He 
was joined by others in the Democratic leadership who pummeled the 
President and used many colorful charts and other props to make their 
points. I was tempted to respond at that time, but, as you know, the 
Senate has been in debate on homeland security, so I didn't have an 
opportunity at that time.
  It is probably good to reflect upon what was said 2 weeks ago and 
remind the public once again. The attack basically blamed the President 
for all that ails our economy. There was an article in the Wall Street 
Journal, dated September 18 of this year, the day the attacks started, 
summarizing the strategy of the other party and the substance of their 
arguments. I will put that article in the Record. I will quote from it:

       In a Senate floor speech he plans to make following the 
     breakfast meeting with Mr. Bush, Mr. Daschle . . . expected 
     to say the President's policies are responsible for U.S. job 
     losses, weak economy, declining business investment, 
     shrinking retirement accounts, an erosion of consumer 
     confidence, rising health care costs, vanishing budget 
     surpluses and record executive pay.

  Indeed, we have seen our Democratic friends on several occasions use 
charts with the listing referenced in the article. Let me be clear on 
the attack because this kind of summarizes the various issues I am 
going to address. According to the Democratic leadership, the 
President's policies are the cause of job losses, weak economic growth, 
declining business investment, shrinking retirement accounts, an 
erosion in consumer confidence, rising health care costs, vanishing 
budget surpluses, and record executive pay--meaning record executive 
pay in the private sector.
  I will tell you, Mr. President, that is an awesome amount of power 
that has been attributed to one individual--the President of the United 
States. But there is a little bit of irony here. The distinguished 
majority leader ascribes so much power to the President you could 
almost make the public believe the President is a king. Maybe this much 
power makes the President an emperor. Now, how many times have we heard 
another Democrat--the distinguished chairman of the Appropriations 
Committee, Senator Byrd--pull his Constitution out of his pocket and 
say the President is not a king. So who is right? Is it Senator 
Daschle, who has made the President such an imperial figure, or is it 
Senator Byrd, who says the President is not a king?
  I think we need to work through this. My view is reality and history 
favor Senator Byrd's point of view that the President is only the 
President of the United States and not an imperial power.
  So I want to go through the Democratic leadership's attack point by 
point. According to Senator Daschle, the President singlehandedly fired 
millions of workers. Funny, Mr. President, I thought employers laid off 
workers, not the President of the United States. It seems to me the 
President can fire political appointees, such as White House staff, but 
I don't think he can even fire Federal workers in America. Heck, right 
now we are hung up on the homeland security debate. That is a fight 
over the extent of the President's powers with respect to Federal 
workers in the Department of Homeland Security.
  The next charge, Mr. President. All by himself, the President has 
slowed economic growth. Funny, I thought we had a global economic 
downturn, we had war on terrorism, we had overcapacity in telecom, and 
we had a bubble in the stock market during the Clinton years. These 
things might have had something to do with it--but not acccording to 
Senator Daschle. No.

[[Page S9656]]

Under the Democratic leadership's theory, all of these things are the 
fault of the President of the United States.
  A third charge. Declining business investment is all George W. Bush's 
fault under the Daschle theory as well. Funny, I thought businesses 
made investment decisions, not the President of the United States. 
Actually, we had a stimulus package pushed by the President. Well, that 
hasn't had any effect, according to Democratic leadership. I guess the 
business cycle doesn't exist under Daschle economics.
  The fourth charge. Democratic leaders blame recent decline in 401(k) 
accounts all on President Bush. Senator Daschle seems fixated on recent 
stock market decline. I have a lot of concern myself.
  The Democratic leadership, however, seems very obsessed with 
assigning blame. By contrast, folks in the heartland, such as my State 
of Iowa, tell me they want us to look forward and do something. They do 
not want a bunch of political fingerpointing.
  If we look forward, we see some very good issues in the area of 
retirement security. In fact, last year's bipartisan tax relief bill 
contained the largest expansion of tax incentives for retirement 
security in a whole generation. There is $50 billion in new incentives. 
I guess Senator Daschle's opposition to the largest increase in IRA and 
401(k) account contributions in last year's tax bill does not make a 
bit of difference; it just does not matter. While some may want to find 
fault, constructive legislators can point to bipartisan initiatives on 
retirement security that workers can look forward to in the future.
  Why scare workers? Why whip up anger? Why not work together? Why not 
recognize some good we do around here, such as the retirement security 
package that phases in as part of the bipartisan tax relief 
legislation?
  Why not bring up the bipartisan Finance Committee pension bill which 
has been on the calendar for the last 3 months? I introduced it only 
this year as a consensus document, and the Finance Committee approved 
it. Let's get out of the partisan blame game and do some bipartisan 
work for the benefit of our workers. Let's build on what we did last 
year.
  The fifth charge: Senator Daschle blames an erosion in consumer 
confidence all on President Bush. Funny, it seems to me that the 
President, although being a very important leader, cannot stimulate 
consumer confidence all by himself. What he can do is propose to return 
more taxpayers' money to the taxpayers so they have a brighter future. 
As policymakers in a time of slackening demand, we hope consumers will 
spend the extra tax dollars that were left in their pockets by this tax 
bill.
  So the Bush tax cut, the largest tax cut in a whole generation, with 
checks to every taxpayer, which the Democratic leadership opposed, had 
a negative effect on consumer confidence? Give me a break. But that is 
the charge Senator Daschle has made. More money to spend for every 
American on their needs negatively affects their confidence? That is 
the charge.
  It goes to tell you, this makes no sense. In the parlance of a 
hunter, that dog does not hunt.
  The sixth charge: The Democratic leadership says rising health care 
costs are all the fault of the President. Funny, the last time I 
checked, the President of the United States was not a physician. He is 
not a nurse. He is not an insurance company executive. He is not a 
pharmaceutical executive. He is not a trial lawyer who sues physicians, 
nurses, and hospitals. The President of the United States does not send 
you a health care bill. But none of that matters. It just does not 
matter. No, ignore market dynamics and other conditions. According to 
Daschle economics, the President all by himself is responsible for 
these rising health care costs.
  The seventh charge: Vanishing budget surpluses are all the 
President's fault, according to Senator Daschle. According to the 
Democratic leadership, their spending demands have never fit into the 
ledger. The recession does not matter. The money for rebuilding New 
York after September 11 does not matter. Bailing out airlines has no 
consequences on the budget, or fighting the war in Afghanistan and the 
war on terrorism have no consequences. These are all unanticipated 
bipartisan responses to unexpected events, and all that does not 
matter.

  No, under Daschle economics, it is all the fault of President Bush. 
Just plain and simple, it is the President's fault.
  Fairminded folks back home know it is not that plain. They know it is 
not that simple. And the folks in the heartland of America are right. I 
will get back to that in just a minute. I want to go to the eighth and 
final charge. And hold on to your hat. This one is pretty amazing.
  According to the Democratic leadership, record executive pay is all 
the President's fault. Apparently, Senator Daschle thinks the President 
votes every share, controls every board of every corporation that has 
suffered from excessive executive pay. So folks such as Terry 
McAuliffe, the Democratic National Committee chairman who profited from 
insider deals, are somehow not accountable for their own actions. The 
boards of directors do not matter, according to Daschle economics.
  Oh, and there is another thing. Just ignore the fact that a lot of 
these sweetheart insider deals occurred long before President Bush was 
ever sworn in on January 20, 2001. Do not let that little fact get in 
the way of the debate.
  How can anyone take that charge seriously, that the President of the 
United States is responsible for excessive executive pay of 
corporations? The President no more sets executive pay than you or I 
do, Mr. President. It is true that we can affect how executive pay is 
taxed, or disclosure, but we do not decide the level of that pay.
  Let's be clear: Either the President is an imperial figure or the 
charges made by the Democratic leadership are without merit. Both 
cannot be true in a modern global economy.
  I will take a few minutes to talk specifically about the bipartisan 
tax relief package enacted last year. Despite the-sky-is-falling 
partisan opposition during the tax debate last year, the passage of 
time tells a very different story and it discounts the fictitious 
picture of doom and gloom portrayed last year by my big-spending 
friends, most on the other side of the aisle.
  According to revised economic data released by the Federal Government 
in August, the economy started to falter earlier than previously 
believed. The figures from economists show that the economy started 
negative growth as early as January 2001, 20 days before President Bush 
was sworn in. This proves the economy needed a shot in the arm sooner 
rather than later to get things rolling again; quite frankly, even more 
so than we thought at the time we passed the tax bill.
  What is more, the primary weakness causing the economy to sputter was 
lackluster business investment, not a waning of personal consumption 
and the expenditure by our consumers.
  Clearly, the job-creating machine in America needed a tuneup, and 
that is just what the President set out to do when he took his oath of 
office. As a cornerstone of his campaign for the White House, the 
President made good on his pledge to return more hard-earned money to 
the working men and women of America.
  As the chairman of the Senate Finance Committee at that time, I had 
the privilege of steering through Congress the largest Federal income 
tax cut in a generation.
  The best way to grow the economy is not by growing Government, it is 
by allowing the industrious people of the United States to manage their 
own income.
  Reducing marginal tax rates on income and investment was exactly the 
right policy prescription to cure sluggish business investments and 
prime the pumps that enable American entrepreneurs, small business 
owners, manufacturers, and corporate employers to grow the economy and 
create jobs.
  It was the right policy. We thought so at the time. History now, 
learning that the recession started on January 1, 2001, and not in the 
fall 2001, as we had anticipated, it was absolutely the right policy to 
do. And we are fortunate it came along at the time it did, in the 
middle of that recession.
  Letting workers, investors, entrepreneurs, employers, families, and 
retirees keep more of their money unleashes chain reaction because they 
spend two-thirds of the economy. They save it--not enough of our 
economy. They invest it--probably not enough of

[[Page S9657]]

our economy. But they open small businesses, creating jobs; they pay 
higher wages, or they buy a house, upgrade manufacturing equipment, pay 
for higher education. The list goes on.
  It is a fundamental principle that policymakers need to remember. 
Money recycled through Washington does not squeeze the most bang out of 
our almighty dollar, and yet plenty of critics continue to blame the 
Republican tax cut rather than the bipartisan tax cut for the Federal 
budget shortfall. This was a bipartisan tax bill because one-quarter of 
the Democratic caucus in the Senate voted for the tax cuts. In an 
election year, too many candidates still like to divide the American 
electorate, and they do that in the demagogic way of pitting the rich 
against everyone else.
  I am sure voters will get their fill of statistics claiming that the 
Bush tax cut hands out 40 percent of the benefit to the top 1 percent 
of the taxpayers. This is not merely misleading, it is outright false. 
Some folks must be under the impression that as long as something is 
repeated often enough, it will become true. That was how Adolf Hitler 
got to the top.
  The facts certainly are thorny little details for the critics of the 
bipartisan tax relief package. According to the Joint Committee on 
Taxation, Congress's official nonpartisan scorekeeper, the Federal Tax 
Code became more progressive with the tax relief package passed in 
Congress last year, and taxpayers in the lower to middle income 
brackets get the biggest break.
  For example, taxpayers with incomes between $10,000 and $20,000 will 
see their taxes reduced almost 14 percent when the tax cut takes full 
effect, whereas taxpayers with over $200,000 a year in income will see 
their taxes reduced by a mere 6 percent compared to that 14 percent.
  As for the budget, the bipartisan tax cut was a minimal factor in the 
Federal Government's surplus to deficit situation. In its first year, 
the tax cut accounted for just 8 percent of the shortfall. Indeed, 
increased spending outpaced tax cuts by $6 billion. In other words, 
Congress spent $6 billion more than the taxpayers got back in their 
pocket from the tax bill.
  Over the long term, the 10-year surplus declines from $5.6 trillion 
to $300 billion. The tax cut represents 33 percent of the decline. 
Those who are looking to lay blame need to point their fingers then at 
Congress's appetite to spend. Folks who decry the tax cut should 
instead weep for the hard-working taxpayer because of the bite that 
Uncle Sam takes out of their paychecks.

  The Bush tax cut saved Iowa households $752, on average, in its first 
year. So I ask Iowans if they can't use that money and if that money 
probably has not been put to good use, now that the economy has slowed, 
to keep the economy out of recession once again.
  Even with that tax cut, the Federal Government takes 19 cents out of 
every dollar earned. That is a record burden, higher than any decade 
since World War II. So thanks in part to the bipartisan tax cut enacted 
in the summer of 2001, things are starting to turn around. Weaknesses 
persist in the manufacturing and employment sectors, but regardless, 
the U.S. economy is as resilient as the spirit of the American people.
  Lowering the tax burden in America triggers growth, creates jobs, 
spreads economic opportunity. Plus, tax cut opponents need to be 
reminded that a bigger economic pie will dish up a bigger slice of 
revenue to fulfill the Government's needs and priorities, including 
what is a result of the war on terrorism and the need for homeland 
security.
  As the top Republican on the Senate tax-writing committee, I will 
continue to champion progrowth economic policies. That includes making 
last year's tax cuts a permanent part of the Tax Code.
  We have, as I am told, maybe just a handful of days between now and 
the end of the session. There are a lot of bipartisan measures that are 
on the agenda that are going to be left undone because we have wasted 
the whole month of September not wanting to vote on a lot of critical 
issues.
  We have the Enron-induced 401(k) refinements so that workers can 
control their own 401(k). We have prescription drugs for senior 
citizens on the agenda. We have the bipartisan approach to recapturing 
lost corporate tax revenue because corporations overseas set up shell 
corporations to avoid tax policy. We have welfare reform that needs to 
be reauthorized. We can go on and on.
  Not just economic policy but the management of the Senate needs to be 
an issue in this election because with so much left undone on the 
Senate calendar that is bipartisan, there is no excuse for that not 
having been done because somebody does not want to take some hard 
political votes between now and the election that could have moved the 
Interior appropriations bill and homeland security along very quickly.
  Management of the Senate is a very important issue in this upcoming 
election based upon what is left on the calendar's unfinished business.
  The PRESIDING OFFICER (Mr. Carper). The Senator from New York.

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