[Congressional Record Volume 149, Number 6 (Tuesday, January 14, 2003)]
[Senate]
[Pages S275-S276]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              THE ECONOMY

  Mr. DORGAN. Mr. President, one of the challenges we face in this 
Congress is trying to find a way to stimulate the economy. Frankly, if 
we do not move at some point, and move rather rapidly, we are not going 
to do what I think the American people deserve to have us do and that 
is to try to put this economy back on solid footing--one towards 
economic growth and opportunity.
  Back at the start of this century there was a fellow, I believe he 
was from Iowa. His name was Joe Connely.
  He actually decided to make a living by something he saw when he was 
a kid. His dad took to him an event in Texas when he was a little boy. 
It was an event in which a promoter took two railroad locomotives and 
ran them together and created a train crash. People actually paid to 
come to see it. Joe Connely thought this was a great deal: If you can 
get people to pay to see a train wreck, I am going to get in the 
business of creating train wrecks. So he did. He went and found old 
locomotives, and he had people lay a track at a town fair. He would run 
these locomotives together and create train wrecks. They called him 
``Head-On Joe Connely.'' His business in life was to create train 
wrecks. Joe died, I believe, in 1936. But his spirit still lives--at 
least here in some nooks and crannies of the Senate--with people who 
design and want to create a train wreck, whether it is on funding, or 
economic packages, or other things.
  But much more important than creating a train wreck is to lay some 
track and do it someplace where we want this country to be able to see.
  Let me describe what I think we ought to do. The President says that 
we have trouble in our economy. Indeed, we do. When you take a look at 
what the American people face in this economy, it is pretty obvious.
  In 2002, 82,000 more Americans were unemployed in December than in 
November. In December, 82,000 people came home and said to their 
families: By the way, dear, I lost my job. The men and women who lost 
their jobs had to come home and tell their families that they were no 
longer employed. It wasn't a fault of theirs, it was that their 
companies were contracting and eliminating jobs. The economy is soft 
and over 80,000 people had to tell their families that they lost their 
jobs. Some 8.6 million Americans were unemployed in December. 2.6 
million more Americans are unemployed now than when this administration 
took office.
  What do we do about that? It seems to me we need to try to put the 
economy back on track and to stimulate the economy some. The President 
says let us have a tax cut of $670 billion over the next 10 years. I 
think that is manufacturing a train wreck. We have a huge budget 
deficit staring us right smack in the face. If we are to do a tax cut, 
I think we probably should try to stimulate the economy in the short 
run. It ought to be a 1-year tax cut which would really stimulate the 
economy. A tax cut of $670 billion over 10 years, the centerpiece of 
which is to exempt all dividends from taxation, is not going to 
stimulate the economy. It doesn't have anything to do with stimulating 
the economy.
  So what should we do?
  I put together some thoughts which I think represent the kind of plan 
we ought to consider. I think we ought to have a tax cut for 1 year, a 
plan that does in fact stimulate economic growth and encourage people 
to create new jobs. I think one of the best ways to do that is to 
provide a one-time tax rebate. I would propose it be in the 
neighborhood of $500 per individual and $1,000 per couple. It is a tax 
rebate that we know works, by the way, because that rebate goes into 
the pockets of the working Americans and then it is spent. That 
spending represents an absorption of capacity in the economy and the 
creation of economic growth.
  In addition to the one-time tax rebate, I would propose a 10-percent 
investment tax credit on new equipment purchased by December 31 of this 
year for manufacturing and production. That, I think, is also 
stimulative and would encourage the kind of activity that can lift and 
provide economic growth.

  In addition, I would--as President Bush has suggested--increase small 
business expensing to $75,000. But again, I would limit it to 1 year.
  I would allow individuals to exclude up to $250 of dividends and 
interest income. I would up that amount to $500 for married couple. 
Finally, I would include in a stimulus package the agricultural 
disaster bill for family farmers that we have already passed here by a 
wide bipartisan margin in the Senate.
  This is a 1-year plan that is affordable. A 1-year plan to try to 
stimulate the economy makes sense. There is not much stimulus in the 
Administration's 10-year plan of $675 billion that puts less than 10 
cents on the dollar back into the economy in 2003. There is not very 
much there to stimulate the economy. The number of dollars of that plan 
for 10 years will be borrowed. We would be borrowing from our kids in 
order to create a plan that would transfer wealth to the upper income 
folks in this country. That doesn't make much sense to me.
  Here are the numbers with respect to the President's plan. Those who 
have $1 million in income and more, on average, will receive an $88,000 
per year tax cut under his plan. I don't know; it seems to me that at a 
time when we have very large Federal budget deficits staring us in the 
face, that is not the kind of thing we want to do.
  Just about a year and three-quarters ago, we had this debate on the 
floor of the Senate about what kind of a tax cut we should have. At 
that time, the administration said: We have an economy that is flowing 
along. We have a country that is blessed with economic health. We have 
an estimated budget surplus as far as the eye can see. We propose a 
$1.7 trillion tax cut over the next 10 years.
  Some of us said: Look. We think we ought to have a tax rebate. I 
proposed a rebate then and some other tax cuts. But we think it is 
unwise to believe that we can see 5 months or 5 years or 10 years down 
the road. What if something happens? What if these budget surpluses 
don't materialize? We were washed away. We were just swept away. Nobody 
cared much about that argument. Do not be conservative about this--just 
understand that we are going to have surpluses that last forever.
  The Congress passed a very sizable tax cut. I did not vote for that 
tax cut, although I supported a tax rebate.
  Mr. President, I ask unanimous consent for 5 additional minutes.
  Mr. KYL. Mr. President, I wonder. Some of us have been waiting. Would 
the Senator make it a little bit shorter?
  The PRESIDING OFFICER. I take that as an objection.
  Mr. KYL. I don't want to object to the Senator's request.
  Mr. DORGAN. Mr. President, I asked consent to speak in morning 
business. Perhaps I should not have done that. I simply should have 
spoken about the underlying resolution. I hope I can perhaps use 5 
minutes in morning business. If the Senator has a time deadline, I will 
be glad to truncate mine and then he can be recognized following this 
Senator's presentation. How long does the Senator intend?
  Mr. KYL. Mr. President, I have no objection to the Senator's request 
for an additional 5 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator has 5 additional minutes.
  Mr. DORGAN. Mr. President, the point I was making was that roughly a 
year and three-quarters ago when the very large tax cut was proposed by 
the administration and embraced by Congress, it was anticipated that we 
would have surpluses forever. It was anticipated that these wonderful 
surpluses were really good economic news and they would last not only 
for a decade but much more.

  Then, in a very short period of time, we had the following. We had an 
understanding that the country went into a recession. In March of 2001, 
we were told that the country went into a recession. Then, on September 
11, we had a devastating terrorist attack in this country that blew a 
hole in the belly of this economy, along with the recession. Then we 
had the war on terrorism that ensued. Then we had corporate scandals. I 
think they were the most significant and perhaps the worst corporate 
scandals in this country's history.

[[Page S276]]

  All of these things converged at the same intersection, undermining 
the confidence the American people had in this country's economy. The 
warning, some of us suggested, should have been heeded because there 
are economic expansion periods and contraction periods. The fact is 
that we went into an economic contraction, and those anticipated 
surpluses are now gone, replaced by very large projected budget 
deficits.
  I know there are some who come to the floor and say the deficit last 
year was $159 billion. It is not. The deficit last year was really $318 
billion. The only way someone can say $159 billion is if they take the 
money out of the Social Security trust fund and use it for operating 
the budget and then show a lower budget deficit. That is what they do 
when they come to the floor of the Senate.
  Fast forward to January 2003. The President says: Yes, now our 
economy is in some trouble. I have a proposal. The proposal is a $670 
billion tax cut over the next 10 years.
  I don't know where he gets the money for that. You borrow it from the 
kids, I guess. But the fact is we are fighting a war against terrorism 
which required us to increase defense spending by $45 billion last year 
alone and increases in homeland security to the tune of $25 billion to 
$30 billion. Is there anyone suggesting that anybody is paying for any 
of this? No. The President is suggesting, as the tonic for America, 
large tax cuts. These tax cuts would go on for 10 years and will be 
paid for by our children in the form of additional borrowing that they 
will be responsible for in order to give the highest income earners in 
the country--particularly those who have very large dividends--big tax 
cuts.
  I come from a small town. I went to a small school and had a high 
school class of nine. They only teach arithmetic one way in this 
country. None of this adds up. It just does not add up. So I think we 
ought to start over.
  Do we need to do something to stimulate this economy? The answer is 
yes. Should we put this country deeper in debt? Should we drink more of 
the tonic that helped us get into this trouble? The answer is no. What 
we ought to do is be thoughtful. What we ought to do is join in 
bipartisan agreements to say: Let's stimulate the economy, in this 
year, to give it some lift, put it back on track, to produce more jobs 
and more opportunity.
  We will not do that by borrowing $675 billion in the coming 10 years, 
adding it to the Federal debt, saddling our children with that 
additional responsibility. We will do that if we are thoughtful, by 
providing, for example, a rebate to the American taxpayers on a one-
time basis, perhaps an investment tax credit, on a short-term basis, 
for business investments in capital equipment and capital goods. We 
will do that if we make the right choices.
  But I tell you, the wrong choice is to go back to the old formula 
that was foisted on this country over a year and a half ago by those 
who said: Don't worry. Don't worry. Times are good, and they will last 
forever. They did not. And now our responsibility, in my judgment, is 
to put this back on track with a plan that will work, one that is 
thoughtful, and one that respects the need to come up with the money to 
pay for these initiatives of ours, and, as Franklin Delano Roosevelt 
said, to give us the privilege, as Americans, to meet our 
responsibilities, yes, during times of national crisis.
  So I say to President Bush, and to my colleagues on both sides of the 
aisle, I really believe we need to do something, but we need to do the 
right thing, most importantly. I hope, as we begin to debate this issue 
of an economic stimulus, of putting the economy back on track, we can 
find a thoughtful, aggressive way to do that without breaking the bank 
and without saddling our children with more debt.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The time of the Senator has expired.

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