[Congressional Record Volume 148, Number 135 (Tuesday, October 15, 2002)]
[Senate]
[Pages S10403-S10404]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             ECONOMIC NEWS

  Mr. BENNETT. Madam President, last Friday the majority leader, 
Senator Daschle, along with the minority leader in the House, 
Congressman Dick Gephardt, presided over an economic summit and 
discussed the state of the economy. Since that summit was called, the 
Dow Jones average has gone up close to 800 points. I would like to 
congratulate them for their wisdom in calling such a summit and 
producing that result. I hope they will have another one and we will 
have the Dow go up another 800 points.
  I was not planning to talk about this, but when I was on my way to 
lunch, I checked and discovered that at that time, at least, the Dow 
was at 8200, whereas it was down in the low 7000s just a week ago.
  I know this will come as something of a disappointment to those who 
are hoping in the election that the economy will be seen as terribly 
under water and will do their very best to try to stir up a sense of 
blame for the lousy economy and blame it on one party or the other.
  I am encouraged by the wisdom of the American people. According to 
the latest polls, the majority of the American people, who have a view 
on the economy and where it is, understand that we are not in a 
recession anymore. We are, in fact, in a recovery; all of the rhetoric 
is to the contrary here on the floor of the Senate.
  Secondly, the recession that preceded this recovery was caused 
primarily by the business cycle and was not caused

[[Page S10404]]

by President Bush's election or any other political event. As I have 
said here on the floor before, the business cycle has not been 
repealed. We would like to think we could repeal the business cycle. 
Indeed, if we knew how, both parties would do it because neither party 
wants to go into an election situation where the economy appears soft. 
So both parties--if they understood how to repeal the business cycle--
would quickly take the steps to do that.
  As a matter of fact, however, as we look at it throughout our 
history, Congress's record--indeed the administration's record--has not 
been all that good in terms of dealing with the business cycle. 
Usually, when we get into the business of trying to outguess it, we 
make things worse rather than better. I remember reading a book by Paul 
Johnson where he was talking about the Great Depression and the great 
efforts being expended by the New Deal. He said the efforts expended by 
the New Deal administration in the 1930s made the Great Depression last 
longer and go deeper than would have been the case if they had done 
absolutely nothing.
  I commented on that to some Ph.D. economists and said that I 
understand that is heresy, and they said: No, quite the contrary, 
Senator. That is basically what has been understood and is being taught 
in the schools of economics around the country--that the intervention 
in an attempt to override the marketplace and the laws of economics, 
however well-meaning on the part of the Government, actually makes 
things worse rather than better.
  As we look at our last recession, we know now pretty clearly what 
caused it. It was the bubble of speculation that surrounded the high-
tech industry, and people got carried away with their conviction that 
the bull market was never going to turn to a bear; that we were always 
going to be going up, up, and up--as Lucy wanted to in the Charlie 
Brown cartoon. Charlie said, ``Life has its ups and downs.'' She said, 
``I want nothing but ups.'' There were plenty of people in the 1990s 
looking at the market and the economy and saying: We want nothing but 
ups.
  Sometimes that cannot be accomplished. We got out ahead of 
ourselves--there was too much capacity. The business cycle kicked in, 
as it always does, and there we were in a recession. The slowdown 
began--we now know--in the midyear of 2000. I remember, with some 
interest, because there was an election going on, there were those who 
criticized then-Governor Bush, who was saying that we were going into a 
slowdown. They said: No, no, we are not going into a slowdown. You are 
trying to pretend that it is for political purposes, and isn't it 
terrible for you to be saying there is a slowdown underway when, 
indeed, we are still having ups, ups, and ups.
  We now know that then-Governor Bush was right; we were going into a 
slowdown in the last half of 2000. It turned into a recession that 
lasted for three quarters--the last three quarters of 2001. Then we 
started coming out of it. Well, those numbers don't add up. The 
recession started in the beginning of 2001. We have now had five 
quarters of growth--admittedly, not as strong as we would like to have. 
Admittedly, there are sectors of the economy that are still mired in 
recession. Talk to the people in the hospitality industry. Travel has 
not come back since September 11 to the degree that it was there 
before--particularly business travel. Airplanes are full, but the 
airplanes are not making any money because in order to get them full, 
the airlines are heavily discounting fares. So that portion of the 
economy is not doing well.

  Housing has done extremely well. Consumer spending stays up because 
household income has held. The sense of wealth has held because 
people's houses are worth more. They have lost money in the stock 
market, but they have seen equity increases in housing, primarily 
because of lower interest rates. I think the lesson is that we can get 
carried away with our economic analysis. We can look back and say the 
economy boomed in the nineties because Bill Clinton was elected 
President or we can say, no, the economy boomed because Newt Gingrich 
was the elected Speaker.
  The fact is, we need more humility as politicians and we need to 
understand the economy boomed because the American entrepreneurs and 
business people did a good job. Those of us in Congress and those in 
the White House contributed to it basically to the extent that we got 
out of the way and let it happen. Now, we need to have some of that 
same understanding.
  I would like to pass the terrorism insurance bill. I think that would 
go a long way toward bringing the commercial real estate sector of the 
economy back. That sector is hurting, and one of the reasons is that 
people will not engage in major commercial enterprises if they cannot 
get terrorism insurance. We have been sitting on that bill in this body 
for close to a year. We passed it. It has gone to conference. The 
conferees have not been allowed to produce a product yet. I hope the 
majority leader will work with the conferees in allowing them to bring 
a conference report to the floor before we adjourn. I think that is one 
thing we can do that would make the recovery more robust than it is.
  Basically, Madam President, I think we need, as I say, a little 
humility as politicians, and we need to understand the economy is very 
sound, very strong, and it is coming back--but a little more steady as 
she goes rather than a sense of panic is what is called for.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. JEFFORDS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Akaka). Without objection, it is so 
ordered.

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