[Congressional Record Volume 150, Number 110 (Wednesday, September 15, 2004)]
[Senate]
[Pages S9271-S9273]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   SQUEEZE ON MIDDLE-INCOME FAMILIES

  Mr. DODD. Mr. President, I want to take a few minutes this afternoon 
and express my concern and the concern of many of us around the country 
about the growing squeeze that is occurring on middle-income families 
in the United States. This is a very alarming trend we are seeing.
  I address not only that point but also the issue of what is happening 
with the rising level of poverty in the country, particularly poverty 
among our youngest citizens in the earliest ages, and the number of 
children being born in the United States who are being born into 
extreme poverty--not just living in poverty but living below half the 
poverty line.
  When you think of the combination of the squeeze occurring on the 
middle income and watching the growing numbers of children living in 
poverty in this country, all of us ought to be supremely alarmed about 
those trendlines.
  Add to that the fact that there now appears to be the largest single 
deficit in the history of the United States, and the failure to create 
new jobs in the country, which is the worst performance of job creation 
since just prior to the beginning of the Great Depression back in the 
1920s. We have lost somewhere between 1 million and 1.5 million jobs in 
this country in the last 4 years. When you compare that to the 20 
million jobs created during the 1990s, there is a startling contrast in 
what is happening to America's economy.
  I think it is critically important in these days that the American 
people be well informed factually about what is occurring as we make 
the difficult choices in the coming days about the leadership of this 
Nation.
  Let me begin with the middle-income squeeze because I think it is 
important to know what is happening to families out there. We are 
watching a tremendous decline in household incomes. Household incomes 
have fallen about 3.4 percent during the last 4 years.
  Let me put that in terms of dollars and cents.
  To give you some idea of the median household income in the year 
2000, the median household income was almost $45,000 a year--actually 
$44,853. Today, that median income is now $43,318. That is a decline of 
$1,500 in median household income. That is a drop in earning power.
  If you have merely a decline in income and also a commensurate 
decline in costs, you would say that is not great, but certainly given 
the cost of essential items that middle-income families must acquire, 
those prices are going down, then the declining income would not be 
startling. But what is happening is quite the opposite.
  We have watched median household income decline by $1,500, and 
simultaneously watched gas prices during the same period of time go up 
almost 20 percent in the United States. College tuition has gone up 
some 28 percent in that same 4-year period, and family health care 
premiums have risen 45 percent just in the last 2 years by 26 percent--
11 percent in 1 year and 15 percent the next. So we are watching 
household median income decline by $1,500, and then we are watching 
college tuition, health care premiums, and gasoline prices soar. This 
is the squeeze. This is what is happening to average families in this 
country.
  Also, as I mentioned at the outset, we are watching jobs not being 
created. We are short of well over a million jobs that we need in order 
to maintain a growing economy. But even these jobs are not coming back. 
We saw 144,000 new jobs created in the month of August. That is 
certainly vastly improved over the 32,000 new jobs created in July. 
Understand that just to keep pace with the new entries into the job 
market we should be creating about 220,000 jobs every month. That is 
what we need to do in an economy such as ours with a population of 
almost 300 million people: You have it produce about 220,000 new jobs 
every month just to stay even.
  When we start talking about 32,000 jobs or 144,000 jobs, while 
certainly 133,000 is positive news, it still is well

[[Page S9272]]

below what we ought to be doing if we are going to keep people working 
at levels that will allow them to provide for their families.

  As I mentioned a moment ago, we are watching incomes decline. This is 
even more true when you start talking about new entrants into the job 
market from people who have lost a job and then go back to work. They 
are making about $9,000 less a year overall, putting all incomes 
together, than they were before.
  While we are creating some new jobs, the wages these jobs are paying 
and the benefits being provided are very different than they were with 
the previous jobs held by these very same people. This is tough news.
  Again, there are choices that will be made in the next 45 or 50 days.
  I point out for the purposes of discussion--sometimes it all gets 
lost--that there are those who are claiming there is nothing to worry 
about, that in fact our economy is good and strong.
  I noted the other day that there was a speech the President gave in 
Michigan when he talked about how well our economy was doing. I think 
it was in Muskegon, MI. He was speaking just 2 days ago:

       This economy of ours is strong, and it's getting stronger.

  That was a speech given in Muskegon and Greenwood Village, CO.
  Since the President has taken office, less than 4 years ago, the 
State of Michigan has lost 250,000 jobs. In Colorado, there has been a 
loss of 80,000 jobs.
  I don't know how you square a statement of saying the economy is 
strong and getting stronger when a quarter of a million people in one 
of the most industrial States in the United States have lost work, and 
80,000 jobs in the State of Colorado no longer exist. How is that a 
strong economy or a stronger growing economy? I don't see that. I don't 
think most Americans would.

  John Kerry, our colleague, who is running for the Presidency, has 
promised to create 10 million new jobs during the first 4 years of his 
administration. We need job creation in this country. We need to be 
talking about creating tax cuts for middle-income families and smaller 
businesses. That is where real growth occurs when you provide the kind 
of stimulus to smaller businesses and industries. They need the relief 
financially to modernize, to buy new equipment, to make themselves more 
competitive in a global economy. We need more of that kind of economic 
thinking than what we have seen in the last few years which has 
contributed to the worsening economic program at home.
  I am an optimist and believe we ought to talk about good things that 
can happen in our country. It is very difficult to go anywhere in this 
country and have that kind of a conversation when people are out there 
struggling every day harder and harder to make ends meet, watching 
their incomes decline and their costs rise, and wondering how they will 
deal with the issues.
  There are an additional 1.2 million Americans who no longer have 
health insurance. That number is up to 45 million in our country; it 
was below 44 million, but in the last year or so that number has jumped 
by 1.2 million. Those people are working Americans who have lost their 
health care coverage because of the rising premium costs of smaller and 
midsized businesses. Their employers are not mean spirited. They just 
cannot afford to maintain the cost of the health care premiums and some 
are dropping their employees from this kind of coverage.
  So now we have working Americans who have watched their health care 
premiums jump tremendously. The average home health care premium in 
2000 was $6,351 a year. Less than 4 years later it has jumped to well 
over $9,000, almost $10,000. That is staggering. Employers just do not 
have the resources to pay these bills. So we find now 1.2 million 
working families in the ranks of the uninsured in our country. That 
adds to our problems.
  I mentioned a moment ago child poverty. I will share with my 
colleagues my deep and growing concern about these numbers because this 
worries me. This is not the America that I was raised to believe in.
  We are talking about a generation of kids coming along who will have 
to be the best educated, best prepared our Nation has ever produced. We 
are now in a highly competitive marketplace in the world. When kids 
grew up a generation or two ago you worried, if you were in 
Connecticut, that you might end up competing with a young person from 
New Mexico or you might compete with a person in Oregon. That was what 
it was like in this country.
  Today, for a child growing up in New Mexico or in Oregon or 
Connecticut, their competition will be in Beijing, it will be in 
Moscow, it will be in Sydney, in Johannesburg, London. A global economy 
will be the challenge. How well prepared is this generation coming 
along?
  We may be in the most unique position of any generation of Americans 
in watching a succeeding generation be less well off, less well 
prepared than we were as a generation. Every other generation 
throughout the more than 200-year history of our country has left their 
children and grandchildren in a stronger position. That has been our 
legacy as a nation. We are now precariously close to setting back for 
the first time in our history where a generation coming along may not 
be as well prepared, particularly when the challenges are going to be 
greater than ever before.
  I worry very much when we see the jump, by 4.3 million, of Americans 
living in poverty over the last 3 years. In the year 2000, of the 300 
million Americans, there were 31.6 million Americans living in poverty. 
Today that number is close to 36 million, up 4.3 million people living 
in poverty in the United States. Of those numbers, we have almost 13 
million of that 36 million who are children.

  While the overall child poverty rate is 17.6 percent, the poverty 
rate for children under 5 is 20 percent. That makes the fastest growing 
group among the poor today, families with children under the age of 5.
  Those are the facts. That is the legacy of 36 months--not quite, 
almost 40 months of leadership here. We are finding ourselves in worse 
shape.
  We are fighting tooth and nail to get some resources for child care, 
for nutrition, for WIC programs to try to do something to assist these 
kids and these families. It is like pulling teeth around here to get 
some help for the kids who, through no fault of their own, are living 
in poverty. Yet the children are the ones who will be asked to defend 
our country, to become well educated, to provide for the strength of 
America in the 21st century.
  I am deeply alarmed about the trendlines. We are not spending enough 
time addressing and talking about what we might do. This is the largest 
annual increase in child poverty in 10 years that has occurred in our 
country. Overall child poverty increased by 5.4 percent in 2003 while 
children living in extreme poverty increased by 11.6 percent. In fact, 
extreme poverty for children under 5 increased by 16.2 percent.
  According to the Census Bureau, over 40 percent of children under the 
age of 18 who are being raised by a single mom are poor. Over half of 
them live in extreme poverty. That is below the poverty level.
  More than half of our children under the age of five who are being 
raised by a single mom are poor. And, 60 percent of them--three of 
every five poor 5 year olds being raised by a single mother--are living 
in extreme poverty.
  I addressed the issue of the squeeze that is occurring on middle-
income families, watching the incomes decline and the costs rise. They 
are dramatic over the last few years. I am worried about the crushing 
blow that is occurring to children and the level of poverty that is 
occurring.
  I raise these issues because we are going to have to change 
direction. We cannot continue the path we are on and expect these 
numbers to change. Every indication we have is the numbers are going to 
get worse and not better if we do not take dramatic steps in a 
different direction. I raise them today, and I pointed out earlier, and 
these are not personal attacks, they are choices we have to make. The 
candidates for President have entirely different views on how we ought 
to address this.
  I mentioned earlier our colleague, Senator Kerry, has talked directly 
about tax cuts and where they ought to occur--for middle-income people, 
for smaller businesses; a health care plan that would start taking 
people off the rolls of the uninsured, put people in insurance programs 
and relieve them of

[[Page S9273]]

the fear of a child or a loved one being caught with a crippling 
illness or accident and bankrupting a family overnight because of their 
absence of insurance protection; of seeing to it that people who work 
overtime get paid for the overtime instead of shutting them off and 
depriving them of the extra income they need; of raising the minimum 
wage instead of depriving people of the kind of increases they need to 
make ends meet.
  The tax incentives make a difference. Those are choices. The 
President says the economy is strong and getting stronger. Tell that to 
the 250,000 people in Michigan or the 80,000 Coloradans who have lost 
their jobs. I think they will agree. This is hardly getting better.
  We need a change. That change will be available to people in less 
than 50 days.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. How much time does the Senator from New Mexico have?
  The PRESIDING OFFICER. Each Senator has 10 minutes in morning 
business.
  Mr. DOMENICI. I will use 10 and I know there is another Republican 
Senator who is not here but he gave me another 10. I am just kidding. 
We will try to get by with 10.
  I say to my good friend, I am just wondering, we have a President who 
is in the hinterland campaigning and we have an opposition candidate 
from your side. I wonder, how come all of you are coming to the Senate, 
one after another, telling us what your candidate is going to do? Can't 
he tell Americans for himself? Does he need you all to come down here 
and give a speech every day, five or six of you, one after another, 
talking about what your candidate is going to do?
  No, I will not yield at this point. You have been talking for a long, 
long time, so let me speak.
  Mr. DODD. How long did the Senator from Connecticut speak?
  Mr. DOMENICI. Ten minutes and I gave you 2 extra minutes.
  Mr. DODD. That is a long time.

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