[Congressional Record Volume 149, Number 158 (Tuesday, November 4, 2003)]
[House]
[Pages H10324-H10330]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ECONOMY SUFFERS UNDER BUSH ADMINISTRATION
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 7, 2003, the gentleman from South Carolina (Mr. Spratt) is
recognized for 60 minutes as the designee of the minority leader.
Mr. SPRATT. Mr. Speaker, last week, the Commerce Department released
the growth rate for the third quarter. It was good news, welcome news,
the kind of news we can all cheer. According to the Commerce
Department, the economy grew at a rate of 7.2 percent in the third
quarter this year.
Now, we all doubt, the President and all the rest of us, that this
pace can be sustained, but we all hope that it signals the start of a
strong recovery because, Mr. Speaker, it has been a long time coming.
Most Americans will be surprised to hear it, but this economy
officially moved out of recession 2 years ago, November 2001.
{time} 2045
And yet for 3 solid years, ever since even the recovery from the
recession, the official recovery, the economy has continued to creep
along, to scrape bottom.
All together, we have had a net job loss in the private sector since
2001 of 3.2 million jobs; 3.2 million jobs have been lost; 2.6 to 2.7
million of those jobs have been lost in manufacturing, some of the best
jobs we have got. And I am afraid some of those jobs are not coming
back, even if the economy recovers.
So before anybody hangs out a ``mission accomplished'' banner over
this economy, I think it is important we recognize tonight and
henceforth that there is a lot left to be done.
Here in a nutshell is what this administration has been able to
accomplish, or not accomplish, on its watch with respect to the budget
and the economy since January of 2001, things that still cry out for
correction, notwithstanding the growth rate that we are experiencing
right now.
This chart shows that the private sector has shed 3.2 million jobs.
That is the worst job record since the Hoover administration, the Great
Depression. Long-term unemployment, that is, people who are unemployed
for 6 months or more, has tripled. That is when it really begins to get
tough. The growth in the economy over the last 3 years, it has grown,
it has not been all recession, but the growth has been 2.1 percent on
average for 3 straight years. There is only one administration in
history who has a worse record than that, that is George Walker Herbert
Bush in the 1990s, early 1990s.
Real business investment, that is investment in productive assets,
business assets that generate jobs and generate profits, has fallen 6.6
percent a year, the worst rate for real business investment since the
Second World War.
And our other deficit, the so-called balance-the-payments deficit,
the trade gap, has also increased by $100 billion over the last 3
years.
Let me just show you in further detail more about what has happened
to the economy. Growth during this administration, 2.1 percent for the
last 3 years. As I said, to find an administration with a worse record
since the beginning of the Truman administration, the end of the Second
World War, you only go back to the Bush administration. Every other
administration has experienced better growth than that.
The unemployment rate has increased from 6 million people to 8
million people. You can see from this chart what has happened to
unemployment. It has gone from 4 percent to as high as 6.5 percent and
now rests at around 6.1 percent, persistent unemployment, even though
we pulled out of the recession.
Let me make that point more clearly. As I said earlier, the economy
pulled out of recession in November of 2001. Now, in all of the postwar
recessions since the end of the Second World War, if you measure them
in jobs lost and jobs recovered, from peak to peak the length of the
business cycle downturn has been about 26, 27 months. And here you see
that average recession plotted on this chart. You also see across the
bottom the red line which indicates the path of this recession.
Typically, in every other recession of nine that have occurred since
the end of the Second World War at about the 13th, 14th month, you
begin to see the job recovery. We begin to regain the jobs that we have
lost in the first 13 months. And by the 25th or 26th month we are back
to where we were a couple of years before, the jobs have been restored.
But look what has happened here. In the 13th, 14th, 15th month of
this recession, this red line keeps going down. It does not turn up.
And this is where we are right now today in November of 2003, barely
holding our own, hardly improving at all over the dismal loss of 3.2
million jobs over the last 3 years. That is what is happening to jobs
in
[[Page H10325]]
our economy. That is why this is a jobless recovery. That is not just a
turn of phrase, that is not just some rhetorical creation. This is a
jobless and a joyless recovery. That is why the people in this country
have not felt the recovery even now officially when we did recover in
November of 2001.
Now, one of the concerns that we all have when you look at this 7.2
percent growth rate is that it represents one quarter. You have to ask
yourself what does the future hold? We hope that this means that the
economy as a whole is beginning to pick up. But we have, I think,
reason to be worried about the long-run future, not the next several
months, not the next quarter, not the next year, but 3 years from now,
10 years from now, 15 years from now when we look at what it has cost
to turn this economy around and in terms of tax cuts.
The Bush administration is sure to credit what has happened to the
tax cuts that it has implemented, three different series of tax cuts
over the last 3 years, totalling about $3 trillion in all in revenue
reduction. And they say that this has been the key factor in turning
the economy around. Of course, it has played a significant part, I am
sure. But we argued all along that this same level of stimulus could be
achieved with a lot less damage to the long-term budget, that you could
have short-term stimulus with the right tax cuts and still have long-
term balance. And that is where the Bush administration comes up short.
Because you will see that in running the budget, running this
economy, in trying to deal with the recession, in putting through ahead
of everything else preemptively its series of three tax cuts we have
seen here this red line here the most precipitous decline, the most
drastic reversal in the fiscal fortunes of the United States since at
least the Second World War, maybe since Woodrow Wilson. It has just
been a tremendous decrease.
Here in a nutshell is what has happened. In the year 2000, fiscal
year 2000, the Government of the United States booked a surplus of $236
billion. That was 4 years ago. Hard to believe, but we had a surplus 4
years ago of $236 billion. Three years ago the Bush administration came
to office with an advantage that few administrations in history, none
in this country, have enjoyed and that is a budget surplus, big-time
surplus. And they had some major decisions to make, but they went first
and foremost with their tax cuts.
Their economists looked out over the next 10 years, and they foresaw
surpluses totalling $5.6 trillion between 2002 and 2011. In 3 years
they have changed that picture from a cumulative surplus of $5.6
trillion to a cumulative deficit of nearly $4 trillion, 3.5 to $4
trillion if you simply assume that what we know to be on the Bush
agenda is implemented and carried out over that period of time with
respect to prescription drugs, with respect to the war in Iraq, with
respect to other tax cuts which it is still calling for.
And when you factor that all in, we see not a surplus of $5.6
trillion but a deficit of 3.5 to $4 trillion. And that is the question
we would like to address tonight.
We are pleased, we are excited, we are hopeful to see the 7.8 percent
growth rate that the economy racked up in the last quarter. But we have
to stand back and ask ourselves at what cost have we come, what long-
term damage have we done to the budget in getting here.
Let me show you one little piece of math that everybody can
understand. If you take the tax cuts that have been implemented to date
and look just at the cumulative cost in terms of revenues lost to date,
which is about $860 billion, and you divide that by the jobs that the
Treasury Department, the Commerce Department claims have been created
during this period of time so that we would have had, they say, 5.2
million jobs lost but for the tax cuts, instead of 3.2 million jobs
lost we would have 5 million but for the fact that these tax cuts have
actually generated a total of 2 million jobs, divide the cost of the
tax cuts through this year by the jobs created, it comes to $3,420,000
per job in terms of revenues lost to the Treasury. That is the
situation we want to talk to you about tonight.
Where are we going? The budgets that have been produced here, the
deficits that have been generated over the last 3 years have been
generated with an attitude almost of indifference to the bottom line as
if the deficits being run were not consequential, as if they will be
wiped out, which we know they will not. All the forecasts of the
deficits we will talk about tonight assume that the economy will be
growing at 3 percent and we are still accumulating deficits of 3 to $4
trillion despite that rate of growth. But they, nevertheless, have been
incurred without any kind of sense of urgency or consequential effects.
It seems to be that those who are overseeing this budget believe that
these numbers are not consequential. We believe, those of us here in
this Chamber, those on this side of the aisle, and many in this House,
we believe those numbers are consequential and they will affect our
future and that once we get this economy up and running and on its feet
again, it is going to hit hurdle after hurdle as it has to deal with
the fact that these huge deficits are there, record deficits, 3, 4,
$500 billion a year.
They will have several different effects on our economy. One is the
government itself will have to pay more interest every year, bigger and
bigger sums in interest, so eventually we will have to raise taxes to
pay just interest. That creates cynicism in the American public because
they are paying taxes to their government and seeing nothing in return
for it, just interest payments.
And, secondly, when the government goes into the open markets to
finance its 4 or $500 billion deficits every year, it crowds out
private borrowers and runs up the costs of capital.
What are the consequences in the long run of the policies we have
been pursuing for the last 3 years? That is the question we pose
tonight.
Mr. Speaker, I yield 3 minutes to the gentleman from Maine (Mr.
Allen) to respond to the issues we have just raised.
Mr. ALLEN. Mr. Speaker, I thank the gentleman from South Carolina
(Mr. Spratt) for leading this Special Order tonight to call attention
to the misrepresentations and the consequences that follow on this
country as a result of the disastrous economic policies pursued by this
administration.
One good quarter of economic growth is something to celebrate because
we have had so many bad quarters, but it is not an answer to what has
gone before. The truth is that the administration of George W. Bush has
done more damage to this country in a shorter period of time than any
administration in my lifetime, largely because it has pursued economic
policies that are reckless and irrational.
Let me call up one chart here that I think will be helpful. The line
at the bottom of this chart shows the total surplus or deficit without
Social Security or Medicare over the last several administrations. What
you can see is how the deficit, the non-Social Security deficit
exploded during the Reagan and Bush years. And then as President
Clinton came to office and instilled a greater sense of fiscal
discipline, we drove that deficit down every year until finally we had
a surplus.
But no sooner had President Bush taken office than he immediately
enacted very large tax cuts and drove us back into deficit again. That
kind of record, that kind of policy has a consequence for jobs, because
this President has racked up the worst private sector job growth record
since World War II. Only in the second administration of Dwight D.
Eisenhower has there ever been negative job growth during a
Presidential term. But today, 1 year from completion of President
Bush's term, we are down 3.2 million jobs in this country. And that is
the worst record for any President since the Great Depression.
What we need in this country is to get back to a sense of fiscal
discipline so that we are not having the Federal Government suck up all
the revenues that need to go to the private sector, that need to go to
investment in this particular country.
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We had Members down here earlier from the other side of the aisle,
and those Members were saying that there is waste, fraud and abuse in
the Federal Government; and surely there is. But Medicare remains the
most efficient deliverer of health care services
[[Page H10326]]
in this country. Medicare does not pay multimillion dollar salaries to
its executives, and Medicare is able to hold down the price of those
health care services that are so important to people here.
What we have in this country today is a neglect of basic principles
of the management of the Federal budget, and it seems to me that there
is a lot more going on here than simply the inability to pay attention.
It seems clear that this third tax cut passed in 2003 can only be
explained as an effort to drive down Federal revenues to a point where
we are not able, as a country, to preserve Medicare as we know it and
to preserve Social Security as we know it.
In conclusion, I would call to mind on that point what the chairman,
the Republican chairman of the Committee on Ways and Means said the
other day when asked on television. Someone said to him in a television
interview: Will not this Medicare bill that you are working on destroy
Medicare? And he said, I certainly hope so because fee-for-service
Medicare is outmoded and not good for the American people.
It is the only program we have. What is going on here is, in my
opinion, a systematic effort to undermine the Federal budget so that
these programs that are in many ways the great achievement of the last
half of the 20th century will be not able to be continued in their
current form.
We need to return to fiscal discipline. We need a concentration on
jobs for ordinary Americans instead of tax cuts for the wealthiest
Americans, and then maybe we can get this country back on track.
Mr. SPRATT. Mr. Speaker, I yield to the gentleman from Arkansas (Mr.
Berry).
Mr. BERRY. Mr. Speaker, I want to thank the distinguished gentleman
from South Carolina (Mr. Spratt) for the wonderful work he does as our
ranking member on the Committee on the Budget. I will be followed in
just a few minutes by the distinguished gentleman from Texas (Mr.
Stenholm), who has served on the Committee on the Budget. He has been a
deficit hawk and a debt hawk and a very responsible person with this
country's money for a long, long time, and I want to publicly
acknowledge the great work that both these gentlemen have done and tell
them how much the rest of us appreciate it.
I can state that to be here this evening talking about this very
issue is a heartbreaking thing for me, Mr. Speaker. I came here in
1993, shortly after the historic vote when they changed the course of
the economy in this country with only Democratic votes to pass the
economic recovery plan of then-President Bill Clinton. I was part of
the Clinton administration. I know how hard it was to reduce spending,
and we did reduce spending. And we continued to reduce spending until
we had the budget in balance with the help of both of these gentlemen.
I know how difficult it was to achieve that.
We reduced the number of Federal employees by 20 percent. And it was
a hard thing to do. And yet, the President now says, this current
President, he comes in, he squanders the surplus, and he says: We are
going to stay the course. We are going to keep doing what we have
already done that has been such a disaster. I guess what he means is,
as near as I can tell, he is going to cut taxes on the wealthiest
people in this country some more.
There is nothing in the minority we can do about it. The Republicans
have the White House. They have the House. They have the Senate. They
can pass whatever they want to pass. But I can tell you where I come
from, Mr. Speaker, it seems to me that some people they just do not
know a good deal from a bad one, and we have obviously been given a bad
deal.
Let us look at the record, and it will be talked about over and over
and over. We are not able to fund education. We cannot fund veterans
benefits; we have to cut them. There are 3.2 million lost jobs, and we
are losing more every day. There is a $5.6 trillion surplus that was
inherited by this administration that has just, simply, been
squandered. Two million people that do not have health insurance. This
is the plan that we are going to stay with. And it is a heartbreaking
thing because we did have a surplus when this President came into
office.
Now, I find the other gentlemen from across the aisle this evening,
they were talking about we had wasteful spending, and they had found
places where the government had not spent the taxpayers' dollars very
wisely, and I do not think we ought to do that either. I agree with
that. But the sad part of this story is if we did away with the whole
department that they were talking about, we could not balance the
budget. If we did away with an entire Department of Defense, Department
of Transportation, Department of Education, and the list goes on and
on, we could not balance the budget.
The budget is so far out of whack that we would not salvage anything
but about 15 or 20 percent of the discretionary spending. If we tried
to balance the budget, that is all we would have.
The wasteful spending they talk about is shameful, but at the same
time it does not even come close to addressing the problem. We need to
understand the magnitude of this problem.
The Concord Coalition says that if we were to balance a budget within
the next 10 years, we would have to cut Social Security benefits by 60
percent, we would have to cut the Department of Defense by 73 percent,
and those massive Draconian cuts go on and on and on. And this is what
the President says that he is going to stay with, the plan. He is
committed to his economic plan.
At some point, Mr. Speaker, you have got to recognize a bad deal when
you have one and deal with it in an appropriate fashion. We simply
cannot afford to continue to do this as a Nation. I am sure our
Founding Fathers would be horrified at this. I am horrified by it. But
the most heartbreaking thing that I find, and that I feel when I see
this happen, is the fact that we are passing it on to our children and
grandchildren.
Why would any responsible adult do this to their children and
grandchildren? We are putting a tax on our children and grandchildren
that they will not have a choice about. They will have to pay
exorbitant taxes just to pay the interest on the debt, not to pay the
debt off. And also I cannot forget the fact that our troops are on the
battlefield losing their lives, making enormous sacrifices, in some
cases the greatest sacrifice; and those that are lucky enough to return
will have to go to work to help pay the interest on the debt where we
borrowed the money while they were in battle. And they will have to
help pay off the interest and the debt that we have incurred in such an
irresponsible way. I think that is a heartbreaking set of facts.
I think that it is absolutely unacceptable that we would allow this
to happen to the next generations. I thank the gentleman from South
Carolina (Mr. Spratt) for his leadership in this matter.
Mr. SPRATT. Mr. Speaker, I yield to the gentleman from Washington
(Mr. Baird).
Mr. BAIRD. Mr. Speaker, I thank my colleague for his leadership, and
I wanted to just expand on what was said.
President Bush in the State of the Union address, and then later on,
made a comment that I strongly agree with, in principle, but not in the
way he has put it into practice. The President said, ``See, I ran for
office to solve problems, not to pass them onto future Presidents and
future generations.''
That is with merit to say that. But what has he, in fact, done?
This is the budget outlook under the current Republican policies. And
I want to call your attention to a couple of things, and I know it is
something that the gentleman from South Carolina (Mr. Spratt) raised
before.
Virtually every Member of this body voted to put Social Security and
Medicare in a lockbox. The President said he would put it in a lockbox.
But what he did not say is he would keep the key to that lockbox in his
back pocket and if budget numbers look bad, he would open up to lockbox
and borrow from it to make his deficit projections look smaller.
The gentleman from Arkansas (Mr. Berry) pointed out that the deficit
is so great under this administration that we could completely
eliminate the Department of Education, the National Institute of
Health, the National Park Service, transportation funding at the
Federal level and a host of other programs, lock up the National Parks,
[[Page H10327]]
shut down all the research at the National Institute of Health, and we
are still not out of deficit.
When the President and the leadership of the Republican party say we
have a $400 billion deficit, what they are not telling you is we are
borrowing hundreds of billions more from Social Security and Medicare.
That debt is going to come due at precisely the time that the tax
breaks these folks have passed expand.
Our friends would have you believe that Democrats want to raise
taxes. That is not true. In fact, this party offered a number of
constructive and responsible tax breaks. But what we do believe is we
should not pass debt onto our kids.
Let us look at the debt we are putting on. You hear about all of $400
billion debt or $400 billion deficit or a $500 billion deficit, and the
Republicans would have you believe, well, it is not so much. It is a
percentage of gross domestic product. But the American people have more
sense than that. The American people understand that even in
Washington, D.C., $400 billion is a lot of money. And they also know
that it adds up year after year after year.
Look at this chart. This chart shows the cumulative effects of the
Bush deficit and the Republican Congress deficit, because make no
mistake about it, the fiscal policies in play in this country right now
are solely, solely the responsibility of the Republican majority
because they control the House of Representatives, the Senate of the
United States, and the Presidency. And their deficit adds up to $7
trillion more debt over the next 10 years. They will double,
effectively double the debt in just 10 years. And that is a debt our
children are going to have to pay. I would submit to you that this is
not an economic policy. It is a Ponzi scheme. Ponzi schemes are
outlawed because they do not work, because you promise people things
that they cannot deliver, and that is what this budget does. They would
have you believe it is going to recover magically. The growth fairy
will come save us.
I will state that in April I gave a speech, and I said we should be
aware, and we should hope that the economy is going to recover because,
quite frankly, if you give me 2 percent interest rates or any President
2 percent interest rates for a period of a couple of years, and if you
pump in a trillion dollars of deficit spending, just like if Disney
dads whip out the credit cards and buy their kids all kinds of treats,
you will think the economy has gotten better. But the long-term cost of
that short-term celebration will be paid by our children and that is
not responsible. That is not conservative and that is not
compassionate.
The American people deserve to know the truth. I applaud the
gentleman from South Carolina (Mr. Spratt) for being able to tell them
the truth and my good friend, the gentleman from Texas (Mr. Stenholm)
who has been a leader on this.
Mr. SPRATT. Mr. Speaker, how much time remains?
The SPEAKER pro tempore (Mr. Bishop of Utah). The gentleman has
approximately 30 minutes.
Mr. SPRATT. Mr. Speaker, I yield to the gentleman from Texas (Mr.
Stenholm).
Mr. STENHOLM. Mr. Speaker, I thank the gentleman for yielding to me.
I think it is particularly important to point out that the gentleman
here is from South Carolina.
A few weeks ago we had a hurricane called Isabel that was heading in
on the East Coast, and the folks from South Carolina, North Carolina
and Virginia began to plan for that hurricane because through modern
technology, we can see it coming through, and we followed it. And there
were a lot of homes that were boarded up. There were a lot of
preparations made, a lot of batteries were bought and other supplies
were bought preparing for what we could see coming.
It is amazing to me that the majority party in this House refused to
acknowledge the coming perfect storm. The perfect storm of fiscal
deficit, now as far as the eye can see, of 400, $500 billion, trade
deficits as far as the eye can see, $500 billion this year and growing,
and these are the jobs that we are losing, the exporting of the jobs
that are occurring.
{time} 2115
That is happening under current policy and then the third component
of this perfect storm, the upcoming baby boom generation that will
begin retiring in 2011. We know that is going to hit all 50 States. It
is not going to pick out Virginia or North Carolina. It is going to hit
all 50 States, and what are we doing in this body to prepare for it
today? Zero. In fact, worse than nothing we are doing. We are digging
the hole deeper.
Fiscal deficits now do not matter anymore, and it is amazing to me,
someone who has been around here and used to vote with my friends on
the other side for attempting to bring fiscal responsibility to this
body, we are now told deficits do not matter anymore. Oh, they are
tried to be explained away as a percent of gross domestic product. The
last one we come in with was $374 billion deficit last year; and folks
say, hey, good news, it is less than the 450 we projected last July.
And we are supposed to rejoice? The 374 happens to be the biggest
deficit in this history of our country. Amazing.
Another little perspective perhaps that people might begin to pay
attention in this body is who I am talking to. It took this country 204
years to borrow the first $1 trillion. In the first 2\1/2\ years of
this administration, we borrowed another $1 trillion. In the next year
and a half, we are going to borrow another $1 trillion. I would hope
with $1 trillion we could get one quarter of 7.2 percent gross domestic
product increase. I would hope that because as we saw on my colleague's
chart a moment ago, the math on this does not add up to being good
business practices.
Oh, when we start down this line, how many times have we heard
somebody say, well, if only Congress would control spending. There are
still a lot of folks out there, particularly on the talk radio shows,
still blaming it on Democrats. Well, we have been in the minority for 8
years in this body, and let me give my colleagues the record of the
last 8 years of Republicans in the Congress.
Spending went up 6.5 percent per year compared to an average 1.6
percent in the previous 8 years. Now, I happen to agree that we have
got to constrain spending. I have promised on this floor, and again,
tonight, I will, to the best of my ability and knowledge, not vote for
one penny more spending than President Bush asked us to spend, period;
but let us stop blaming spending unless my colleagues are willing to
control spending, and that means all spending. We cannot just pick out
that which we like, because in the economy it is all spending.
I happen to be personally of the opinion that it is worse policy to
borrow and spend than it is to tax and spend; and I say that because
when we tax and spend, the voters take it out on us; but when we borrow
and spend, the voters are still in diapers, and they cannot take it out
on us. Therefore, it is easy to borrow and spend to get through the
next election; but then somebody's got to pay the piper, and boy, the
hole we are digging is getting deeper and deeper.
My friends and colleagues on both sides of the aisle and Mr.
President and this administration, the perfect storm is gathering. The
idea that we can borrow at the rate we are borrowing and spend at the
rate we are spending and not have somebody pay the piper is redefining
basic economics.
The trade deficit is the second leg of that perfect storm, and the
baby boomers are going to begin retiring in 2011, guaranteed. What are
we doing? Tax cut a week. Tax cut a month. New economics. Dig the hole
deeper. Well, I do not know whether it was Confucius or Garfield that
first uttered the words, When you find yourselves in a hole, the first
rule is to quit digging.
The second observation I make in closing tonight, in listening to my
colleagues on this side earlier tonight, 5-minute speeches talking
about waste, fraud and abuse, it is on my colleagues' watch. If we are
spending too much, Mr. President, veto some bills because they do not
spend or they spend too much.
Also, I am reminded of the words of the late Will Rogers, ``It ain't
ignorance that bothers me so much. It's them knowing so much that ain't
so is the problem.''
We listened to the debate tonight, we listened to some of the
statements that
[[Page H10328]]
were made earlier, and we look at charts that the gentleman from South
Carolina (Mr. Spratt) is showing. These are facts. What I have just
said about the deficit are facts. They are not made up. They are not
made up. But what are we doing about it? Not one cotton-picking thing
except digging the hole deeper, until somebody starts paying attention.
I thank the gentleman tonight for attempting to cause some of us,
hopefully to get 218 of us, to start paying attention again and do
something about the deficit and the approaching perfect storm before it
is too late. I thank the gentleman.
Mr. SPRATT. Mr. Speaker, I thank the gentleman from Texas. I yield to
the gentleman from Arkansas (Mr. Ross).
Mr. ROSS. Mr. Speaker, I thank the gentleman from South Carolina for
his leadership as ranking member of the House Committee on the Budget,
and I am here tonight joining my friend from South Carolina and the
gentleman from Texas and others because I am concerned about our
country and its future.
Let me preface my remarks by saying that I am one of 37 members of
the fiscally conservative Democratic Blue Dog coalition. I am as sick
and tired of all the partisan bickering as anyone else. I do not look
at an idea and look at whether it is just a Democratic idea or
Republican idea. I look at it, is it a commonsense idea? If it is, then
I support it. But when it comes to the budget and when it comes to the
tax cut that was passed earlier this year, the Republican leadership
and this administration are dead wrong. Do not take my word for it;
look at the numbers.
Under this administration, 3.2 million people have lost their jobs.
We now have 9 million people out of work, unable to provide for their
families. People have lost $.6 trillion in the stock market, and much
of that is retirement savings for so many working families. There are
43.6 million people in America without health insurance. Ten million of
them are children. Most of the rest of them work for a living. They are
working the jobs with no benefits.
Trade deficits have increased nearly $100 billion. We had a $5.6
trillion projected surplus when President Bush took office. That has
become a $3.5 trillion projected deficit over the same period of time.
In fact, we have the largest deficit ever in our Nation's history; 374
billion is what they want my colleagues to believe it is, but when we
take Social Security out of it and not count Social Security, it is
really a $535 billion deficit. Does it matter? Either way we cut it, it
is the largest deficit ever in our Nation's history.
The Republicans like to say the Democrats are the ones who spend the
money. This is the first time in 50 years that the Republicans have
controlled the White House, the House and the Senate; and they have
given us the largest deficit ever in our Nation's history.
The first bill I wrote as a Member of Congress was a bill to tell the
politicians in Washington to keep their hands off the Social Security
trust fund. The Republican leadership refused to give us a hearing or a
vote on that bill, and now we know why. Because they were borrowing
$374 billion from the Social Security trust fund to help fund this
budget, the largest deficit ever in our Nation's history.
Let us think back a moment from 1997 to 2001. We had a balanced
budget. We were beginning to pay the debt down. Now we have a $7
trillion debt. This country is spending $1 billion a day, $1 billion a
day simply paying interest on the national debt. How much is $1
billion? I put that number to a calculator and get a little E at the
end.
I will tell my colleagues how much $1 billion is. We could build 200
brand-new elementary schools every single day in America just for the
interest we are paying on the national debt. Better yet, we could
provide 1 million senior citizens on Medicare prescription drug
coverage for a year just with the interest that we are paying in 1 day
on the national debt, $1 billion a day in interest payments on this $7
trillion debt. We are not talking about principal payment; we are
talking simply interest payments.
What are we seeing from this administration? We are seeing cuts in
education. It was President Bush who said his top priority was
education reform in this No Child Left Behind business, and he is the
one who told us how much it would take to implement this program. My
colleagues know how it works in this body. If it had been my program
and he was cutting it, that makes sense. We are talking about he cut
his own program. Arkansas's cut, $87 million for next year. What does
that say about our commitment to our children and their future?
Veterans benefits are being cut left and right. What kind of message
are we sending to the men and women in uniform serving us today in Iraq
and Afghanistan and around the world when we are cutting the benefits
for the veterans who came and served before them?
These may be Republican priorities, but they are not American
priorities. These may be Republican values, but these are not America's
values. I believe it is time for us to get our fiscal house back in
order, to restore common sense and fiscal discipline to our Nation's
government.
Finally, let me say that I raise these issues because I believe our
priorities and values should be centered around our children ensuring
they get the very best education possible, Head Start, after-school
programs, providing our veterans with the help that they so desperately
need. We need to be investing in infrastructure. That is how President
Roosevelt got us out of the Depression, with the WPA program. I drove
over bridges yesterday that were built as part of the WPA program. We
are there folks. We are there. All 50 States collectively are faced
with the largest shortfall they have seen since the Great Depression.
We should be investing in our infrastructure, and we need to be
investing in jobs.
I raise these issues because my grandparents left this country better
off than they found it for my parents, and my parents left this country
better off than they found it for our generation, and I think we have
got a duty and an obligation to leave this country a little better off
than we found it for our children and grandchildren.
I thank the gentleman from South Carolina for yielding.
Mr. SPRATT. Mr. Speaker, I yield to the gentleman from North Carolina
(Mr. Etheridge).
Mr. ETHERIDGE. Mr. Speaker, I thank my friend from South Carolina
(Mr. Spratt) for leading this Special Order. It is timely and so
important, and it is really about the failure of the Republican regime
here in Washington on the budget, at a time when the other side in the
budget debate is engaging in, I think, deception and misinformation and
sometimes down right dishonest figures.
The gentleman from South Carolina (Mr. Spratt) is not only an expert
on the Federal budget, but he is engaging as a lone voice of truth and
really what the facts are and I thank him for that. The American people
need to know that.
The truth of the matter is that the Republican economic record is in
shambles and is leading this country in the wrong direction. This
failed economic record has three main features: huge budget deficits,
massive job losses, and festering domestic problems. The Bush
administration and the congressional Republicans have sought to deny
their budget calamity of the blown surplus and the return to huge
deficits, and they are going to be there as far as the eye can see; but
the Congressional Budget Office has determined that the budget would be
balanced, as we have already heard, by 2006 if it were not for the
administration's tax policies.
{time} 2130
As bad as the budget situation is, as has been shared by my
colleagues, the administration and the leadership in this Congress will
not stop digging. The first thing to do, as our colleague from Texas
said when you get in a hole, the first thing to do is stop digging.
Well, they are going to bring more programs out that will dig the hole
deeper.
The economy has lost roughly 3.2 million private sector jobs, the
worst record of any administration since Herbert Hoover and the Great
Depression. My home State of North Carolina has seen devastating job
losses. We are the second largest State with manufacturing job losses
in the country. The national unemployment rate has gone from 4.1
percent to 6.1 percent. North Carolina Statewide unemployment is
[[Page H10329]]
roughly 6.6 percent, and I have counties in my congressional district
where the unemployment rate is approaching 15 percent.
For all their talk about appealing to the investor class, as we have
heard this evening, Republicans have presided over the loss of $4.6
trillion in stock market wealth, and a lot of that is income of
retirees.
The problem is made worse by the record deficits and massive national
debt that is going to make it impossible for us to make the investments
that we need to make in America's long-term economic prosperity. As has
been shared this evening, we need to be investing right now, for
example, just in education, the administration is proposing to
shortchange its Leave No Child Behind by roughly $20 billion over 3
years. I met on Monday with international business officers of this
country, they know already because they are seeing the cuts, what this
is going to be about is it is going to be unfunded mandates to local
governments at a time when they are hurting. Critical needs at the
local level are going unmet in a whole lot of areas, and problems are
festering because the national debt crisis is getting worst.
Just last week, WRAL-TV, the largest television station in the
Raleigh market, talked about a school in North Carolina that is
bursting at the seams with overcrowding; specifically, New Hope
Elementary School in Wilson, where 135 students are going to classes in
closets, literally in closets. That is wrong at a time when we could be
doing better if we were doing the right thing about our budget.
The Democrats had a plan to do it. We could get the economy going
without massive debts. We have sponsored legislation to fund school
construction, but my colleagues on the other side of the aisle will not
let it happen. The administration and the Republican leadership in
Congress refused to act because they have blown the budget surplus, so
there is no money left.
In conclusion, Mr. Speaker, Democrats have a better idea to return to
a balanced budget and return sanity and honesty to the Federal budget.
I thank the gentleman from South Carolina (Mr. Spratt) for leading this
Special Order.
Mr. SPRATT. Mr. Speaker, I yield to the gentleman from Virginia (Mr.
Scott).
Mr. SCOTT of Virginia. Mr. Speaker, I thank the gentleman from South
Carolina (Mr. Spratt) for his leadership in this budget issue. We have
seen a lot of charts, and I would like to remind the public of this
chart right here which shows the deficit from the Johnson
administration, Nixon, Ford, Carter, the deficit created during the
Reagan and Bush years. And then when President Clinton came in, as
noted, we passed a budget without a single Republican vote that created
the momentum carrying up towards an actual surplus. We got ourselves
out of the ditch into a surplus.
Some have suggested that since the Republicans used this vote and
took over the House and the Senate, that they ought to get some credit
for this improvement. Unfortunately, they should not get the credit
because as soon as they took over, they passed trillions of dollars in
tax cuts, and President Clinton vetoed those tax cuts. They threatened
to shut the government down, he vetoed them again. They shut the
government down, President Clinton stuck to his guns, vetoed it again,
and as a result, this line continued up.
Unfortunately, when President Bush came in, he signed those trillion
dollar tax cuts, and we see what would have happened a long time ago
had President Clinton not vetoed those budgets.
Now, this goes down to an on-budget deficit of almost $700 billion.
We have to put that into perspective and the fact of the line item
individual income tax, how much revenue we get from individual income
tax in the United States, less than $800 billion. In a couple of years,
we are going to be almost $700 billion in on-budget deficit, spending
almost $150-$200 billion in Social Security and Medicare, and then
almost $700 billion in on-budget deficit.
We cannot sustain this for very long. Let us see what this next chart
shows, the height of fiscal irresponsibility, because this shows how
much of their budget was paid for with borrowed money. Back in the
depression in World War II, obviously, a substantial amount was paid
for with borrowed money, but we are getting to numbers now, and this
goes to 2010, we are getting to numbers now that we have not seen on a
sustained basis since World War II. This year we are breaking the
record. Since World War II, we have not seen almost a third of the
budget being paid for with borrowed money. Of course, during the
Clinton years, the amount paid for with borrowed money went down due to
the fact that it was actually a surplus. And as soon as President Bush
came in, we started paying for the budget with borrowed money, and we
are up in a couple of years with almost a third of the budget being
paid off in borrowed money, and it looks like it is not going to get
any better in the future.
How did we get there, we got there with tax cuts. And who got the tax
cuts, the top 20 percent got most of the tax cuts. In fact, half of the
tax cuts went to the upper 1 percent. Most people do not know how big
the tax cut was because most people did not get very much. As we can
see from the chart, the middle 20 percent did not get very much, and on
down. By income, if the taxpayer made more than a million dollars, they
would be off the chart, a $90,000 tax cut in 1 year. If all they made
was $500,000 to $1 million, you got $13,000 in 2003. $200,000 to
$500,000 on average got $2,000. And as we get down to $50,000 to
$75,000 on average, the taxpayer hardly noticed what they got. Going
down, we do not even need any red ink to show what they got. Most
Americans do not know how big this tax cut was.
But we were told we had to cut taxes to create jobs, and the
gentleman from South Carolina (Mr. Spratt) told us how many jobs have
been created. We, in fact, lost jobs. On a 4-year basis back to Truman,
everybody is gaining jobs. Eisenhower in his two terms, almost two
million jobs. Everybody is creating jobs until we get to this
administration. We have lost 3.1, 3.2 million jobs already lost in this
administration.
We cannot blame this on 9/11 because going back to the Truman
administration, and that includes the Korean War, coming forward it
includes the Vietnam War, the hostages in Iran, Somalia, Grenada, the
Cold War, everybody is still creating jobs, until we get to this
administration.
This is a complicated chart, but it shows what the Republican-led
Joint Committee on Taxation thought about the tax cuts. Since they are
done with borrowed money, there might be a short-term spike in jobs
that we should expect, but depending on which model we use, we will be
losing jobs, at best, and end up where we started in the fullness of
time. So the Joint Committee on Taxation told us this was a job killer.
When we run up deficits, we run up debt and interest on the national
debt. This shows the interest on the national debt that has to be paid
in cash. More actually has to be paid, because we have to pay interest
on trust funds, but that is internal. This is what we need to come up
with every year in terms of cash. By 2010, $300 billion every year just
to pay interest on the national debt. This line here shows what we
would have been paying had we not messed up the budget in 2001. The
projection was that we would be paying no interest on the national debt
by 2008, but instead because we messed up the budget, $300 billion a
year.
This is happening at a time when the Social Security trust fund
becomes a challenge. We see in this chart the Social Security trust
fund. The blue is the surplus that we are running now. We are bringing
in more in Social Security than we are paying out. We ought to keep it
in the lockbox which has been referenced because, obviously, we are
going to need it shortly. But unfortunately, we are spending it all.
This shows the deficit. By 2030, it is almost $900 billion a year in
shortfall that we are going to have to come up with every year to pay
Social Security as promised.
Members may look at this chart and conclude maybe it was a lost
cause, maybe we just could not pay Social Security, maybe it was just a
matter of time before the thing went broke, but there is one little
interesting fact. When we go back to this tax cut in 2001, this tax cut
was so large that if we had taken what the top 1 percent got and
instead of giving a tax cut to
[[Page H10330]]
the upper 1 percent, if we put that money into the Social Security
trust fund, just what the top 1 percent got, everybody else gets what
they got, just the top 1 percent, put that into the Social Security
trust fund, we would have built up the surplus enough to have paid
benefits under Social Security without reducing benefits for 75 years.
For 75 years, Social Security would have been secure, or tax cut for
the upper 1 percent. Those are the kinds of choices we have been making
and the reason we have been fighting for fiscal sanity. If we do not
get this straight, we are going to lose Social Security.
We cannot pay increasing interest on the national debt and this
increasing deficit in Social Security without something having to go.
By all likelihood, it is going to be the Social Security program unless
we get things under control.
So I would hope we can get the budget under control and people will
follow the leadership of the gentleman from South Carolina (Mr. Spratt)
in maintaining fiscal discipline so we can have Social Security in the
future for us and the next generation.
This is a very challenging chart, but as I said, if we had allocated
the same amount of money as we had for the upper 1 percent in tax cuts,
just 2001, we could have had a secure Social Security program for 75
years. Those are not the kinds of decisions we ought to be making. We
have to reverse that direction, and that is why I am delighted to
participate with the gentleman from South Carolina (Mr. Spratt) in this
Special Order.
Mr. SPRATT. Mr. Speaker, I thank the gentleman for his contribution.
____________________