[Congressional Record Volume 149, Number 35 (Wednesday, March 5, 2003)]
[Senate]
[Pages S3110-S3111]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   THE STATE OF THE AMERICAN ECONOMY

  Mr. DURBIN. Mr. President, I would like to move the spotlight of the 
comments on the Senate floor this morning from the international scene 
to the domestic scene, and point to the front page headline of the New 
York Times, Wednesday, March 5: ``U.S. Budget Deficit Seen Rising 
Fast.'' This is an analysis that they report which comes from the 
Republican-controlled House Budget Committee. It is a startling piece 
of information. I will read the first two paragraphs from this article:

       The federal deficit is growing much more quickly than 
     expected, even before Congress takes up President Bush's tax-
     cutting proposals and without factoring in the costs of a war 
     in Iraq, Congressional analysts have concluded.
       Analysts for the Republican-controlled House Budget 
     Committee have raised their estimates of this year's budget 
     shortfall by about $30 billion, some 15 percent beyond the 
     forecast . . . issued only five weeks ago.

  We come today to discuss many issues, but certainly one of the 
overriding issues is the state of the American economy and what we are 
doing on Capitol Hill to deal with the challenges we face.
  There was a time, not that long ago, when the Republican leaders, 
conservative in philosophy, really condemned the whole problem of 
deficits in our country and said they were dedicated to eliminating 
them. Now we hear from Treasury Secretary Snow and others that deficits 
are meaningless: Don't worry. Be happy.
  The concept of going to a $400 billion deficit next year is not only 
a troubling prospect but represents a dramatic turnaround in terms of 
Federal spending in Washington, DC.
  When this President came to power--President George W. Bush--he 
inherited a surplus. He came into office with a set of circumstances 
that any President, any Executive, would be happy to find. We had 
reached the point where we were not overspending.
  Of course, the President, as he came to office, saw the beginning of 
a recession which has become progressively worse under his 
administration to the point now where we see consumer confidence at 
historic lows, unemployment at historic highs, people in business 
across America depressed and sometimes despondent over whether we are 
going to find our way out of this budget problem.
  Second, the President--and this, of course, in fairness, is not his 
doing by any means--inherited the age of terrorism and the threat of 
terrorism which has created a dampening problem across the economy that 
cannot be diminished. That is a major factor.
  So he has a recession which has become progressively worse while he 
has been in the White House, terrorism which has cast a pall over the 
economy, but then this President made matters worse. Two years ago he 
said to this country, even though we are facing deficits, the thing we 
should do first is to cut taxes. Any politician who announces a tax cut 
is going to get applause. People love that idea. Of course, they would, 
to think they would have more money that is not taken by the 
Government. But the President came up with this proposal at exactly the 
wrong time in exactly the wrong way. In a deficit situation, he made it 
worse.
  Two years ago, he proposed a tax cut which took more money out of the 
treasury and, frankly, did not invigorate the economy. He gave a tax 
cut to the wealthiest people of America. It is the age-old Republican 
approach. They believe if tax cuts are given to the wealthiest people, 
somehow that will eventually help middle-income families and those in 
the lower income categories. It didn't work 2 years ago. People in the 
lower income categories saw a $300 check, and they didn't change their 
lifestyle. It did not invigorate the economy. Things went from bad to 
worse. Now this President comes and tells us what we need for the 
economy is more of the same, tax cuts for the wealthiest people.
  Quite honestly, if it didn't work 2 years ago, it is not going to 
work now. It won't invigorate the economy. It will drive up the deficit 
at a time when the bottom is falling out of the Federal budget.
  Don't take my word for it. The Republican House Budget Committee 
tells us we are about to see a record deficit. This President's 
proposal for tax cuts over a 10-year period of time will dramatically 
increase the national debt. It means our children and our grandchildren 
will have to shoulder the burden of the debt we are leaving them. It 
means programs such as Social Security are likely to languish and 
suffer because of this President's reckless economic policies.
  To think this deficit is coming out of the Social Security trust fund 
should give us all pause. You know the demographics. The baby boomers 
are about to reach an age when they qualify for Social Security and 
Medicare. We should be mindful of that. We should be preparing for 
that. We should be cautious and prudent.
  Instead, this White House and many who support it have said: Forget 
it; don't worry about it. Keep borrowing money from the Social Security 
trust fund. Keep jeopardizing the future of Medicare, drive up the 
deficits, increase the tax cuts so that tax breaks can be given to the 
wealthiest people.
  Why in the world would we follow this course of action? Those who 
call themselves conservatives should have an examination of conscience, 
as the nuns used to tell me many years ago in grade school. They should 
sit down and ask themselves, Is this really why I came to Congress, to 
build up a national debt to record levels?

  Let me add one important footnote. There is another tax out there 
that this administration will not talk about. It is called the 
alternative minimum tax. It was created years ago to make sure people 
who escaped all tax liability, people in the highest income categories, 
would pay something, an alternative minimum tax. But sadly, this tax, 
without reform, has grown in terms of its application, has grown in 
terms of the people who are being affected by it to the point that in 
just a few years you will see more and more middle-income Americans 
paying more in an alternative minimum tax than they are paying in their 
regular income tax rates.
  Who will be the people affected by this? People with incomes below 
$100,000, middle-income families. People with a teacher in the family 
and a policeman, for example, will find themselves paying an 
alternative minimum tax.
  What does it take to fix this problem? A lot of money; to eliminate 
it, $600 billion that this President has not budgeted for.
  This President and his administration refuse to tell Congress and the 
people what we are getting into in terms of our exposure in the war in 
Iraq, how much it will cost. Larry Lindsey, the President's economic 
advisor until he was asked to leave a few weeks ago, blurted out that 
this war

[[Page S3111]]

would cost us $100 to $200 billion. He was asked to leave the 
administration for his candor. Now we can't get the administration to 
even tell us what this war, not only the waging of it but the cost of 
the occupation force afterwards, is going to cost. It isn't even 
factored into the budget deficit.
  Make no mistake, I will say this as a person who has questioned this 
administration's approach on foreign policy. If and when this war 
begins, I will join an overwhelming bipartisan majority in Congress to 
provide every penny necessary to wage this war successfully and bring 
our men and women home safely, having completed their mission. We are 
going to do that. It is a given. To ask the administration what this is 
likely to cost is not unreasonable. We went into a bidding war over the 
last several weeks when it came to Turkey, how much money we would send 
to Turkey, if they would allow us to base our troops there for an 
invasion of Iraq. The numbers went from $15 billion to $26 billion. We 
were bidding right and left. What is it going to cost overall?
  This administration is not putting money into homeland security. This 
administration is not budgeting what it takes to defend America against 
terrorism. We are budgeting what it takes to prepare to attack in Iraq; 
we are not budgeting what it takes to prepare to defend in America.
  When all these are put together, understand that we are headed down a 
perilous course with President Bush's economic policy. It is a course 
which, frankly, is not going to invigorate the economy; it is not going 
to create jobs; it will not create consumer confidence. It will create 
a debt and deficit at the expense of Social Security and Medicare for 
generations to come. We should not, in a weak moment, rally behind a 
President who clearly is on the wrong course when it comes to America's 
economy. We need to stand up and make certain that we are going to work 
for a sound economy, a fiscal approach that is prudent and cautious and 
takes into consideration the needs of America in the long term.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Graham of South Carolina). The Senator 
from Nevada.

                          ____________________