[Congressional Record Volume 150, Number 130 (Monday, October 11, 2004)]
[Senate]
[Pages S11250-S11251]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              THE ECONOMY

  Mr. SESSIONS. Madam President, I want to share a few thoughts about 
the status of the economy. As we finish up this session, everybody has 
a lot of different views, and we are in a political season. I think it 
is good to talk about it and discuss the issue and see what the facts 
are, and let the American people make up their own mind about what the 
circumstances are that face our country.
  One thing that I think is important for all of us to remember is that 
without economic growth we will not create jobs.
  When we are in an economic situation in which we do not have growth, 
then we are not going to have jobs created. We may not lose those jobs 
immediately, but as growth lags, the number of jobs will fall as well. 
As growth goes up, jobs will be created. Jobs, as the economists say, 
tend to lag behind growth, but they follow growth. When economic growth 
is declining, the number of available jobs will decline. When economic 
growth is going up, the number of available jobs also will be going up.
  Growth in the American economy is affected by many different things. 
The economy can be affected by world events, or by the strength of the 
economy in other nations. Generally, we are not threatened by strong 
economies in other parts of the world. Our economy does better when 
other economies are doing well, and when other economies are doing 
poorly, our economy tends to be dragged down.
  The American economy is also impacted by business factors, by 
psychological factors, and by governmental factors that impact jobs and 
growth. If the President could snap his fingers and make everything 
happen right, we would never have any problems. But we know the 
President cannot do such a thing. We know we need to be careful about 
placing blame and credit.
  I would like to show this chart. These are the years beginning in 
1995 going into 2003. We had good years through the 1990s.
  The chart shows these undisputed facts. Former President Bush 
suffered an economic slowdown in the second year or so of his 
administration and it resulted in the phrase: It's the economy, stupid. 
But the truth is, the nation's economy began to rebound significantly 
before former President Bush's term was finished. In fact, during his 
last year in office, he got little or no credit for the rebounding 
economy because he had been tagged by his political opponents for 
causing an economic slowdown earlier. The fact is that this 
characterization was inaccurate, and that there was pretty solid 
economic growth during this time.
  President Clinton, I submit, inherited a growing economy from former 
President Bush. That is just a matter of fact. And it grew well through 
the 1990s. We had low quarters and good quarters, but overall the 
economy showed strength during this period.
  In President Clinton's last year in office, however, things began to 
sour. By the time he had left office, the Nasdaq, the high tech stock 
market, had lost one half of its value. During the third quarter, of 
President Clinton's last year in office, the economy experienced 
negative growth, though there was growth in the fourth quarter of his 
last year in office.
  But the first quarter that President Bush inherited, in which the 
dynamics in the economy were already set, and upon which he cannot be 
fairly said to have influenced, the economy suffered further negative 
growth. The second quarter that President Bush inherited also 
experienced negative growth. The third quarter was 9/11, with its 
negative impact on the economy. That is what President Bush faced when 
he took office. Yes, we had some great years in the 1990s, but he 
inherited an economy that was in trouble, and I submit that fact is not 
disputable.
  He had to make some choices. Are we going to take the liberal idea, 
the big Government, the tax-and-spend idea that we were going to get 
out of an economic slowdown, a recession, by increasing taxes and by 
increasing the size of Government, or are we going to place our faith 
and hope in the ingenuity, the creativity, the work capability, of the 
American people?
  President Bush placed his faith in the American people. He fought 
for, and we battled on the floor of this Congress and passed, a 
substantial tax cut that was designed to revive the economy, which was 
in trouble and was costing people jobs, making people worried. The 
stock market had gone down. It was a nervous time for all of us. We 
remember that.

  President Bush led. And look what happened. As the chart shows, in 
the wake of his actions the economy starts coming back. When we had the 
second tax cut that took place in 2003, in June, the middle of the year 
2003--and this chart only goes through 2003--we ended up with 8 percent 
growth during the third quarter of that year. Eight percent growth in 
that quarter is the highest growth rate we have seen in 20 years. The 
fourth quarter was also about 4 percent. The first quarter of this year 
was 4.5 percent growth. The next quarter was 3 percent growth. So we 
have been blessed to see that this recession is one of the shortest 
recessions in history. It is something for which we ought to be 
thankful.
  Mr. SARBANES. Will the Senator yield for a question?
  Mr. SESSIONS. I am pleased to try to answer a question. I know how 
knowledgeable the Senator is in these areas.
  Mr. SARBANES. If the Senator's chart continued out into this year--I 
take it the chart stops in 2003?
  Mr. SESSIONS. I found that in my office a few moments ago. The first 
quarter was 4.5 percent.
  Mr. SARBANES. If it continued out into this year, it would show a 
descending line, would it not?
  Mr. SESSIONS. It would show the first three quarters of this year 
would average higher than the last 20 years of growth in America.
  Mr. SARBANES. I want to focus on----
  Mr. SESSIONS. It would show a decline from probably 4.5 percent to 3 
percent growth.
  Mr. SARBANES. That is all I wanted to hear.
  Mr. SESSIONS. You are not going to stay up there at 4.5 forever. But 
I think the numbers look pretty good. And we did it by investing and 
putting our faith in the private sector to create jobs and growth. It 
is pretty exciting.
  We don't know how the economy will go. President Bush, as I said, is 
not a magician. He can't make things happen by waving a magic wand. Any 
of us who have been around here long enough know that. You get blame 
and you get credit. Sometimes it is not the President's fault, 
sometimes it may be the Congress's fault. Sometimes it may be factors 
beyond any of our control, historic factors.
  Because we have had substantial productivity increases, which means 
we can produce more widgets for less investment and often fewer 
workers, that has made us competitive and helped our economy, but it 
has also placed stresses on job production. We have had particularly 
noticeable productivity increases in manufacturing. As a

[[Page S11251]]

matter of fact, the whole world is seeing a decline in manufacturing 
jobs because plants can produce more products with fewer people at less 
cost.
  Since August of 2003, we have had 1.9 million new jobs created. But 
significantly, in the year 2004, we have had 97,000 new manufacturing 
jobs created.
  That is good. That is something we ought to be pleased about. Let me 
note that the unemployment rate has fallen to 5.4 percent. It was 6.3 
percent last June. It is now 5.4 percent, which is lower than the 
average unemployment rate for the 1970s, 1980s, or the 1990s.
  The gross domestic product--the net production of goods and services 
in America--has grown for 11 straight quarters. So we have gotten out 
of this negative growth pattern left to President Bush by former 
President Clinton, and we have had 11 straight quarters of growth.
  I think a factor in that was the President's leadership, for which I 
am very grateful. Some have said that job growth has failed to keep up 
with population growth. But that is not true. As the Joint Economic 
Committee, of which I am a member, reported: Since the unemployment 
rate peaked at 6.3 percent last June, total employment has increased by 
2.2 million. The labor force has increased by 949,000.
  That means there are 949,000 more workers. Unemployment has fallen by 
1.2 million. Due to the large increase in employment and the large 
decrease in unemployment, unemployment has fallen significantly despite 
population growth.
  I think Senator Cornyn is correct in saying that there exists in our 
country today a larger than normal number of people who are working out 
of their homes, working as independent contractors, as consultants, as 
truck drivers, and other things, who don't show up on a classic 
payroll. The statistics from the household survey that pick up that 
form of employment have been looking much better than the payroll 
survey for some time. The payroll survey is a valuable survey, but the 
household survey is valuable, too. The emphasis in complaining about 
President Bush's leadership does ignore, consistently, and without 
variation, the more positive numbers that show up in the household 
survey.
  I think President Bush and this Congress have dealt with a very 
difficult problem--this economic slowdown. We did it in a way that is 
consistent with America's heritage and American values. As Americans, 
we are not a people who embrace a socialist, state-run economy. We are 
a vital, vibrant, innovative, creative people, and this allows our 
economy, because we have no governmental domination of it, to flourish 
and reach its highest possible ideals.
  That is why the Europeans, in my view, are not doing as well. Germany 
and France have double-digit unemployment of 10, 11, 12 percent, 
because they have a state-run, state-dominated, regulated, bureaucratic 
government with high taxes. It has made it difficult for them to be 
competitive in the world marketplace. Why would we ever want to emulate 
that? Why would we ever want to go to the socialist European ideal? Why 
would we not want to affirm the direction that President Bush is 
leading us?
  I think Congress is working in order to follow the American ideal of 
freedom and independence, low taxes, and limited regulations.

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