[Congressional Record Volume 154, Number 15 (Wednesday, January 30, 2008)]
[Senate]
[Pages S478-S480]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ECONOMIC STIMULUS
Mr. BAUCUS. Madam President, the psalmist prayed:
Do not cast me off when I am old. Do not forsake me when my
strength fails.
That is really the question before us as we get to the economic
stimulus bill, which is the bill that is going to send out rebate
checks to Americans: Will the Senate cast off 20 million seniors? Will
the Senate forsake 20 million of the neediest Americans?
A vote for the Finance Committee substitute is a vote for 20 million
American senior citizens who have worked hard all their lives, who have
paid taxes for a lifetime. They contribute to the economy today. But
the underlying House-passed bill would not give them a rebate check.
The House-passed bill says no to 20 million American seniors. The
House bill gives checks only to the more affluent seniors whose incomes
are high enough that they pay taxes now. The House-passed bill would
not give a stimulus check to seniors who are scraping by on Social
Security income alone and have no tax liability. To state it
differently, the House-passed bill says no to the most neediest
seniors, not only 20 million American seniors, but the House bill says
no to the 20 million American seniors who happen to be the most needy.
These 20 million seniors have given a lifetime of labor. They have
given a lifetime of service, and they have paid a lifetime of taxes.
The House-passed bill would not give them a stimulus check.
Think of a grandmother who needs money for food, medicine. America's
economy is slowing down. Times are
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getting tough for her. Prices for food, gasoline, and home heating oil
have skyrocketed right before our eyes. She has a harder time making
ends meet. For many of our Nation's senior citizens, their only source
of funds for these necessities is a once-a-month envelope from Social
Security. Any Social Security beneficiary will tell that you she has
not seen the amount of her check increased enough to cover today's
rising costs. I am sure the benefits may be going up a little bit, but
they clearly do not cover the increase in rising costs. Again, the
Finance Committee package says yes to those 20 million American seniors
who we believe should be included. They should also get a rebate check.
The House-passed bill says no to those 20 million American seniors. It
says to seniors who happen to be the most needy, no, we are not going
to give you a rebate check. That is the basic reason why I believe the
Senate Finance Committee package passed today is by far the better
alternative.
Just think, when Congress acts on an economic stimulus package this
week, tomorrow, whenever it is, we should insist on that tax rebate for
the 20 million low-income seniors who can use that money right now. A
rebate for seniors is no feel-good measure. Obviously, it is the right
thing to do. Rebates for 20 million more seniors will help the economic
stimulus package work better. Why is that? Because seniors are among
America's most likely to spend a refund right away and pump cash back
into the economy.
This chart basically demonstrates that. According to the Bureau of
Labor Statistics, Americans over age 65 are responsible for over 14
percent of all consumer spending. People over 65 spend 92 percent of
the their yearly incomes. That is represented by the horizontal bar in
blue, a little bit of purple over on the right. So people over 65 spend
92 percent of their yearly income. People over age 75 spend 98 percent
of their incomes. That is higher than any other demographic group over
the age of 25.
Seniors spend the money they receive. They have to, in most cases,
spend the money they receive. It is the right thing to do, to give
senior citizens access to that rebate check. Why exclude them? Why cut
seniors out as the House does? That is not right. In addition, seniors
spend the money they receive. Seniors over age 65 spend 92 percent of
the money they receive, and seniors over 75 years of age spend 98
percent of the income they receive. So seniors will spend that rebate
check right away. That will make the rebate check all the more
effective in helping the economy.
The Senate needs to do the right thing by America's seniors and by
the American economy. We should extend the tax rebate to 20 million
American senior citizens living on Social Security. The Finance
Committee substitute will help 20 million seniors who were left out of
the House bill. The Finance Committee amendment will provide seniors
with a rebate check of $500 and $1,000, if they are married.
What is more, the Finance Committee amendment helps a quarter of a
million disabled veterans with rebate checks. So far I have talked only
about senior citizens. The House-passed bill does not give rebate
checks to disabled American veterans. The House bill does not provide
low-income disabled veterans rebate checks. That is, the House bill
does not give rebate checks to a quarter of a million, and that is
because they do not provide low-income disabled vets with rebate
checks.
The House discriminates against lower income seniors, 20 million
American seniors. It discriminates against lower income disabled vets.
It says no to a quarter of a million disabled veterans. We in the
Finance Committee say, no, we should say yes to seniors. We should say
yes also to disabled veterans who will get the same rebate check as an
upper income disabled vet.
What is more, the Finance Committee amendment helps people who have
lost their jobs. Don't you think that is the right thing to do, help
people who have lost their jobs, particularly as we are either in a
recession or close to a recession? The Finance Committee amendment
provides an additional 13 weeks of unemployment insurance, and high
unemployment States will qualify for an extra 13 weeks. The House bill
does not provide an extension for unemployment insurance. It says no.
It says, no, I am sorry, too bad. If you have lost your job and your 26
weeks is already up, which is the case for a higher proportion of
America's unemployed today than at any other time in recent history,
the House says, no, sorry. Even though you need the money, even though
you would have clearly spent the rebate check, they say, no. The House
bill doesn't provide that extension.
There are almost a million more unemployed Americans than there were
unemployed a year ago. The Congressional Budget Office found that
unemployment insurance has a great bang for the buck. That is, people
who are unemployed who receive their unemployment insurance spend it.
In fact, economy.com, a company which analyzes these things--their
person testified today or yesterday before the Budget Committee--found
that each dollar spent on extended unemployment insurance benefits
would generate $1.64 in increased economic activity. That is a good
one. In straight economic terms, for every $1 spent, $1.64 is the
result in increased economic activity.
The bipartisan stimulus bill enacted after 9/11 included an
unemployment insurance extension. President Bush signed that extension.
Why don't we do it now? We all know what dire straits the economy is
in. The Federal Reserve system cut the Fed funds rate another half
percent. When you add it up in the last 4 or 5 months, 1 percent plus
three-quarters plus another half, what does that amount to? That is a
2\1/4\-percentage points reduction in the last several months. They are
worried. But those rate cuts take time to work their way through the
economy. An economic stimulus package has an effect right away. That is
why we believe we should have components in the economic stimulus
package which improve upon the House bill and give 20 million seniors
rebate checks and a quarter of a million disabled vets rebate checks
and also extended unemployment benefits.
The Finance Committee amendment helps American businesses that need
help. The Finance Committee amendment would extend what is called the
carryback period for net operating losses from 2 years to 5 years. Why
is that important? Generally, a cyclical business has some profitable
years followed by loss years. During loss periods, the company will
carry back the net operating losses for the lost years to the prior
profitable years. They will file a quick refund claim. The quick refund
claim acts as a cash infusion and allows the company to survive the
loss period. The House bill doesn't take care of that. The housing
industry would greatly benefit from an increased carryback period.
This whole economic downturn was sparked by a so-called subprime
problem, the housing problem, a glut of houses. And the expanded period
would allow builders to avoid selling land and houses at distressed
prices.
Additionally, it would enable less costly financing, improving
business conditions for an eventual return of the housing market. The
expanded period would give the housing industry cash to meet payroll.
That is not a bad thing to do when we are in an economic downturn. That
would stop additional job losses. The National Association of
Manufacturers has written us in the committee in support of the Finance
Committee's net operating loss proposal because they know it is the
right thing to do to help maintain jobs.
These are all good reasons to vote for the Finance Committee
substitute. It would help disabled veterans. It would help unemployed
Americans. It would help businesses struggling with the business cycle.
It would help 20, I think the figure is 20 million American senior
citizens. I start where I began. I repeat this point because it is so
important. The biggest difference between the Finance Committee
substitute and the underlying House bill is 20 million seniors. A vote
for the Finance Committee substitute is a vote for those seniors. Keep
this in mind: 20 million, right here. That is the number of seniors to
whom we would give rebate checks because it is the right thing to do,
to add 20 million to the House-passed bill, which does not give rebate
checks, which is clearly the wrong thing to do.
Senators should not cast off seniors. Senators should not forsake
them. Rather, let us recognize their lifetimes
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of labor, recognize their key role in stimulating the economy. Look at
our senior citizens. They are the real salt, the rock of America. Our
mothers and fathers and grandfathers, most of them passed through the
Depression era. Some are a little old for the Depression era, but they
have values that are so important for our country. They are the people
who paid taxes all their lives. They worked all their lives. They
provided service to so many of us and our families and to other
neighbors in the community. Let us recognize their key role in
stimulating the economy, and let us pass the Finance Committee
substitute for those 20 million American seniors.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. HARKIN. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
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