[Congressional Record Volume 150, Number 38 (Wednesday, March 24, 2004)]
[Senate]
[Pages S3053-S3055]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
EXTENSION OF UNEMPLOYMENT BENEFITS
Ms. CANTWELL. Mr. President, I join my colleague from New Jersey in
discussing jobs, job creation and whether we will have the opportunity
to vote on two key amendments that will help stimulate our economy--one
amendment addresses overtime pay and the other would reinstate the
federal unemployment insurance program.
Many of my colleagues know that when we took a vote on reinstating
the unemployment program on February 26, we actually had a majority of
Members of this body supporting the program. On February 4, a majority
of Members of the House of Representatives supported a similar
provision.
Congress supports this program, and supports an extension. The reason
we created the State and Federal unemployment programs was to provide
temporary and partial wage replacement to people who are involuntarily
unemployed and to help stabilize the economy during recession. That is
why we created the program.
Yet, for some reason, we have put that notion aside and somehow think
the economy is getting better and unemployed workers who have lost
their jobs, through no fault of their own, somehow should not be able
to participate in this Federal program.
My own newspaper, the Spokesman-Review, had an editorial this week
that basically said: Let us put money in the pockets of those who are
not to blame for being out of work. Such a move will help businesses
that rely on consumer spending, help them stay afloat, and was one of
the chief reasons for creating unemployment benefits in the first
place.
What we are doing this morning is continuing to ignore the plight of
the American workers who have lost their jobs through no fault of their
own. We are being irresponsible, not allowing Americans to participate
in a Federal program that was designed to create opportunity for people
and to allow them to sustain themselves in an economic downturn when
there are no jobs being created.
So much has been bandied back and forth about whether we are actually
recovering from this recession and whether and how many jobs will be
created. I think it is important to look at the facts to see what
economic projections have been made in comparison to what has really
happened.
My point is not to place blame for what has happened. At this point
my concern is with the unemployed workers who are struggling to make
mortgage payments, pay insurance bills, put food on the table.
Any economist will tell you that sometimes projections are wrong. In
the case of job creation in the past several years, we have been dead
wrong about what was going to happen to the U.S. economy. In 2002, the
Bush's Council of Economic Advisers said: We are going to have job
loss, but it is not going to be that severe: We are going to lose about
100,000 jobs. But, in fact, in that year we actually lost 1.5 million
jobs.
As a result, the President proposed his policies that were based on
that projection. I didn't support his policies, but I am not going to
spend a lot of time this morning critiquing whether or not they were
sound. Instead, I am asking my colleagues on the other side of the
aisle to not make this a partisan issue. I am asking them to make this
about the American worker who needs our help utilizing a Federal
program designed to help out in times just like this.
So, then in 2003, the President's economic forecast projected that
the economy would create 1.7 million new jobs. But in reality, there
was no job growth. In fact, we lost jobs. Instead of growing the
economy, we lost 406,000 jobs.
This year, some of my colleagues on the other side of the aisle are
saying we don't have to keep the Federal unemployment benefits program
going because the President has projected that we are going to have a
record year--that we are going to create 2.6 million jobs. That was the
actual forecast from the Council of Economic Advisors. I can provide to
my colleagues the specific page, the specific citation.
When several members of the President's Cabinet traveled to my state
of Washington in February, they backed away from the projections. They
said: We don't think that 2.6 million really is the number of jobs that
are going to be created this year. We don't really think the forecast
means what we thought it meant. I can tell you, the unemployed worker
is not a rounding error; they are real people with real needs they have
to meet on a day-to-day basis.
To reach this 2.6 million jobs by the end of the year, the economy
would need to create between 200,000 to 300,000 jobs per month. That is
not what is happening at all. That is not what happened in January and
it is not what happened in February. It is probably not what is going
to happen in March.
The real issue is that, while some people are saying the economy is
better, and gee, things are rosy since the unemployment rate is only
5.6 percent, they are hiding the fact that the unemployment rate held
steady last month largely because 392,000 people are no
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longer counted as unemployed. Many economists and many newspapers
around the country have said the national average would be more like
above 7 percent if you actually included those people who aren't
getting counted.
Some people question whether the Federal program helps or hurts in
the end. They say, don't we want these people out looking for jobs?
Well, I can guarantee they are out looking for jobs. I have had so many
constituents who have come to my Web site and told me their personal
stories about how they are trying to find a job, often competing with
20 or 30 other people for a job for which they are all overqualified
because there are not jobs being created. Consequently, they are
without the opportunity we all would like to see in their communities.
They have lost a job through no fault of their own, they are working
hard to find a new opportunity, but jobs are not being created.
What do you do when jobs are not being created? You utilize this
Federal program that could provide opportunity to people for 13 weeks
beyond the State program. And this program creates an economic
stimulus. Even Alan Greenspan recently said he believed we should have
programs like this one in times of economic downturn. In fact, he
testified before the House Education and the Workforce Committee before
we adjourned for our last recess and he said:
In times like this, I have supported the issue of extension
of unemployment insurance.
He said that is because it is important to stimulate the economy.
The program we are talking about right now would generate billions of
dollars of stimulus that would go directly into the economy over the
next 6 months. In fact, for every dollar spent on unemployment
insurance, those individuals turn around and spend that money, $2, in
our local economies. They pay their mortgage payments, their health
care bills, their tuition for education, for their children to go to
college. It helps sustain them until economic growth actually returns.
When the first Bush administration was faced with this dilemma, when
they had a recession in the 1990s, the first Bush administration said:
Let's extend the Federal unemployment insurance program. Actually, the
economy had been creating substantial numbers of new jobs for several
months when the first Bush administration extended the program. Why?
Because they knew that it would take time for the economy to recover.
They knew all of those people were not going to find jobs immediately.
Even though jobs had been created, the Bush administration extended the
unemployment benefit program for another 9 months. As we all know, that
was the right policy decision and many people went back to work over a
period of time and they had the wherewithal to sustain their families
in the meantime.
I say to my colleagues on the other side of the aisle, it is time to
get past the obstructionists who are holding this up. A majority of
Members in both the House and the Senate want this legislation passed.
They want to help the American worker. 5.6 is not the real number of
unemployed people in America. It is not a fair representation.
Even Business Week did a fabulous story presenting the issue of jobs
in America, ``Where Are The Jobs?'' I urge all my colleagues to read
through it in detail and see where exactly the jobs are in America. In
reading it, you will find there has been an increase in productivity.
There has been an increase in productivity and consequently there have
been fewer new hires. While corporate CEOs have made more money and the
stock market has benefited from the efficiencies of business, the
person who has not benefited is the American worker who has not found a
job. Unlike the 1990s when there were millions of jobs created at the
same time that we achieved gains in productivity, now we have
productivity gains and no jobs are being created. It is going to take
us longer to recover.
This Senator believes very much in the economy of the future. I
believe there are some very strong sectors. As my colleague said
yesterday, I believe we have to have the right fiscal plan, we have to
have the right sectors--sectors like biotechnology and nanotechnology,
software, and aerospace will continue to grow with the American
economy. I think if we make this investment in unemployment now, we can
give the American workers the help and the assistance they need during
this time of job loss.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. ENSIGN. Mr. President, I am going to speak on the JOBS bill and
the importance of passing the JOBS bill. In particular, a portion of
the JOBS bill called Invest In The USA Act, which I authored with
Senator Boxer last year. I just want to take a couple of minutes to
respond to the comments of the Senator from Washington about
unemployment and extending the temporary extension of unemployment
benefits.
We have had this debate many times on the Senate floor and it has
been shown that when the Democrats were in control of the House, the
Senate, and the White House, the extension of unemployment benefits was
terminated when the unemployment rate in the country was 6.4 percent,
almost a full percentage point higher than it is today. Historically,
the termination criteria remains true.
In the past, both President Clinton and the Democrat leader of the
Senate, Tom Daschle, talked about a 5.6 percent unemployment rate and
what a strong economy the US had at that time. Today, people's mindsets
are different. People think that our current rate is actually a high
unemployment rate.
I believe we need to continue to look for things that will create
jobs in America. We need to have job training, in fact we have passed a
bill in the Senate that would improve job training. But we need to stop
the filibuster of the Workforce Investment Act and allow it to move
into conference, in order for the benefits to be seen. That bill will
help train almost 1 million new workers and help them find new jobs in
United States. The Workforce Investment Act is an important piece of
legislation.
There is a large number of jobs going overseas, and on the other side
there are a lot of jobs that have moved to the United States. That is
what makes up a global economy. It is a constantly changing global
economy. Lower paying jobs usually move overseas, while higher paying
jobs are created in this country. But there is a problem. In the last
few years, as our economy has changed, not as many jobs have been
created in this country as there could have been.
We have a provision called the Invest in USA Act, which recognizes
that over $500 billion has been accumulated in bank accounts for U.S.
companies overseas because of the tax rates that would be charged on
that money if it was brought back to the United States. U.S. companies
pay up to a 35-percent corporate tax rate to bring that money home.
This is a list of some of the various developed countries around the
world. This is their normal corporate tax rate. The United States has
the highest corporate tax rate when compared to countries in the world.
This is just one fact that represents the stark contrast of what the
United States does to its companies compared to what other countries do
when companies invest in countries outside their own market.
If a U.S. company goes to China and earns income over there, when it
brings that money back, it has to pay up to a 35-percent tax rate on
the money it brings returns to the U.S. If a company from France goes
to China and makes money over there, and they bring the money back to
France, it is zero percent. France charges them zero percent; Germany,
zero percent; Canada, zero percent; Australia, zero percent; and, Great
Britain, zero percent. These countries have recognized that it is a
positive thing for the money to come back into their country.
The Invest in USA Act, which I introduced with Senator Boxer last
year, passed 75 to 25. Every Republican voted in favor of it and half
of the Democrat Senators voted in favor of the Invest in USA Act.
Unfortunately, it was dropped out in the tax debate in what is called a
conference committee. It is now part of the bigger JOBS bill we have
before us today. I might add--because of the tariffs the European Union
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will be putting on American companies--it is important to have this
JOBS bill passed. I believe, of everything in this JOBS bill which is
important, this is the most important piece.
First, I talked about the $500 billion in the overseas markets. Of
the $500 billion or so in American companies' bank accounts overseas,
$400 billion conservatively--I think the lowest estimate of any of the
studies I have seen is that $300 billion comes back--will come from the
four corners of the world back into to the United States.
To put this $400 billion number in perspective, from 1996-2002, it
was clear that the United States was experiencing pretty good economic
times. There are IPOs--initial public offerings--on the stock market.
With IPOs, people raise money to be able to invest and pay down debt.
There are all kinds of various uses for IPOs. During 1996-2002, all of
the money raised with those IPOs does not equal this $400 billion
number. With this one simple Act, Congress can bring back more money to
the United States and create jobs than in all of the initial public
offerings that were done for the stock market from 1996-2002.
It is critically important we enact this legislation in order to
bring jobs back to America. Some critics say it is unfair for the
companies that are here in America which have paid their 35-percent
corporate taxes. I am supportive of lowering the corporate tax rates,
as often companies pass their taxes on to the consumer and are not
directly responsible for them.
We need to make American businesses more competitive. One of the ways
we can do that is to lower the corporate tax rate. But given the fact
that the rate is where it is, companies have no incentive to bring the
money back here to the United States.
For all of those companies that are paying that higher tax rate, if
they want to share in a better economy, let us bring $400 billion back
to the United States to invest, pay down the debt, invest in new
capital improvements, do research and development in the United States,
and create jobs right here in the United States.
Various studies have been done regarding this important issue. Alan
Sinai is probably one of the most respected economists in the United
States. He certainly is not considered a conservative. Many would say
he is maybe a little more liberal than conservative. I do not know that
you can really paint him one way or the other, however he is well
respected by both sides of the aisle. His estimate is that 660,000 jobs
would be created by this one Act alone.
The Joint Tax Committee says that over a 10-year period of time, if
we enact the Invest in USA Act, it will help reduce the deficit by
around $4 billion over 10 years. That in and of itself is a very small
number compared to the over $2 trillion budget we have on an annual
basis. But the Joint Tax Committee does not count any jobs that are
produced. They do not count any of the taxes that are paid by those
jobs that are being produced. Alan Sinai, on the other hand, looked at
what kind of total impact this bill would have on the U.S. Government.
In other words, would there be a loss of taxes or a gain of tax
revenues because of the health in the economy. He has estimated that
$75 billion in deficit reduction would be possible because of this one
provision in the JOBS bill.
The Invest in the USA provision will create 660,000 jobs, and I
believe that is a conservative estimate. It will bring back $400
billion in cash for all kinds of positive things for U.S. companies and
U.S. workers. It will help the taxpayer and help pay down the debt, and
everybody around here talks about how important it is to ensure the
deficit is reduced.
Of all the good things in the JOBS bill that we are talking about
today, for those who are truly interested in creating jobs in America,
we need to pass this incredibly important piece of legislation.
Of the few objections I have heard to this legislation, one is that
it is not fair to American companies. I believe that issue has been
addressed. The second is you should not implement a temporary fix, that
companies and people are content to wait. Instead of paying 35-percent
corporate tax rate, they are only charged 5\1/4\ percent. Critics say
you should not do that just for 1 year because then companies will wait
for the next tax holiday. I agree, doing temporary tax holidays is not
necessarily a good idea, however, I want to use this as a model to show
that if we encourage United States companies that have invested
overseas to bring their money back--if the tax laws in America are
changed--we can, indeed, create more jobs on American soil in this
growing global economy.
There is an clear imbalance. Most of which is not the fault of the
companies. Lou Dobbs constantly talks about job outsourcing and paints
United States companies as evil companies. The bottom line is the
companies are doing what is in their best financial interest. It is the
Congress that has set up these incentives to go overseas and to keep
the money overseas.
What the Invest In The USA Act does, is allow a temporary fix to
bring the money back in the next 12 months, stimulate the economy, and
then show the model of how a permanent fix can make America more
competitive in the global marketplace.
I yield the floor.
The PRESIDING OFFICER. The Senator from Missouri.
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