[Congressional Record Volume 157, Number 193 (Thursday, December 15, 2011)]
[Senate]
[Pages S8667-S8669]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE ECONOMY
Mr. GRASSLEY. Mr. President, it seems the President of the United
States has finally acknowledged that the economy is in a terrible state
and there is nothing he can do about it. So, rather than offer new
ideas to grow the economy, the President has now shifted into blame
mode. I recognize that the slow economic growth and high levels of
unemployment are having a significant impact on the middle class. But
rather than listen to political rhetoric and witness finger pointing by
President Obama, the unemployed would likely prefer ideas, ideas on how
to turn this economy around.
I presume President Obama aspired to lead the country because he
believed he had the vision and the ability to lead to a more prosperous
nation. But beyond the vision, a President also needs a plan and the
leadership to put that vision into place. Where is that leadership?
During the past 3 years, we witnessed President Obama's theory on
economic stimulus. We saw a massive expansion of government and deficit
spending. More than $800 billion was spent on a failed economic
stimulus bill that was supposed to keep unemployment below 8 percent.
But it did not. Government spending in the process has reached an
unprecedented level. Today, the size of government, if you combine
local, State, and Federal, is 40 percent of our gross national product.
One hundred years ago when Teddy Roosevelt delivered his speech in
Kansas, it was 8 percent. I refer to Teddy Roosevelt and the speech in
Kansas because the President of the United States now tried to
duplicate that speech 100 years later.
Today, government consumes 40 percent of the entire economy.
According to economic policies of President Obama, government needs to
grow even bigger to help our economy, and in the process there is a
goal to use government to redistribute wealth. If government gets a
little bit bigger, the argument goes, and if it gets a little more
involved, and particularly if it gets involved in every facet of our
economy and our lives, that will surely increase economic prosperity of
all Americans. Right?
Of course not. All of this has led to taxes and deficit spending that
crowd out private investment that could grow the economy and, in the
process, create jobs. Government doesn't create self-sustaining jobs;
government only creates government jobs. The private sector creates
jobs. It is the responsibility of the government to create an
environment that leads to job growth. It does this by instituting the
rule of law, property rights, the patent system, among others--and
there are a lot of others I ought to add to it. Government sets the
tone.
Remember, government consumes well, it does not create well. Through
economic freedom, entrepreneurs are free to innovate and prosper. This
economic success leads to higher standards of living and a better
quality of
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life. Importantly, these gains do not come then at the expense of
others. Contrary to what some would have you believe, business growth
does not have to come at the cost of others. In other words, it is not
a zero sum game. In fact, business success and economic growth lifts
all boats through employment gains, higher wages, and value to
consumers, among a lot of other things that could be mentioned.
There are some who believe that individual success cannot be achieved
without government involvement or intervention. What is more, they
believe an individual's success must mean that someone else has been
deprived or they believe if someone else is successful, the success was
achieved collectively only with the help of government or others in
society. This line of thinking concludes that government and society
is, therefore, entitled to some of those achievements.
President Obama's recent speech in Kansas provides great insight into
his economic theory. He clearly believes government should be involved
at every level of individual and business activity. The President says
that hard-working Americans should be rewarded for their achievements.
However, his economic vision demonstrates his belief that individual
success is due to society, not because of hard work or individual
effort. This line of thinking is in stark contradiction to our
country's founding principles that government exists to allow for the
individual to achieve success and the pursuit of happiness.
The idea of government intervention runs contrary to our founding
principles of individual and economic freedom. Government exists to
serve the needs of people rather than people serving the needs of their
government. There are some who believe government is the only creator
of economic prosperity, but if others have achieved success, they must
be, by default, the cause of other people's hardships. This type of
class warfare demagoguery is harmful to our country and our country's
future and our people's future, and it has the end result of dividing
America. It creates envy, hatred, and resentment toward those who have
worked hard, played by the rules, and achieved success. This divisive
rhetoric seeks to put blame on the successful for the hardships of
those who have been hurt during this recession.
Most Americans don't support President Obama's divisive vision and
rhetoric. The American people still believe if you work hard and play
by the rules, you can be successful and you can flourish. I doubt the
majority of Americans believe it is the goal of government to intervene
in this process. In fact, most Americans would be happy to have the
government get out of the way. Most Americans believe in individual
responsibility and liberty, including freedom to succeed and freedom to
fail.
It appears President Obama's commitment to these fundamental freedoms
is less sure. Based on his recent speech in Kansas, it seems the
Federal Government is the answer to all of America's problems.
According to the President, if we tax the wealthy, ensure they pay
their fair share, we can get our economy back on the right track.
President Obama wants the American people to believe higher taxes on
job creators will lead to economic prosperity and create jobs. This is
contrary to what Republicans know to be true. It is also contrary to
the vision President John F. Kennedy knew to be true when in the 1963
tax bill he reduced the marginal tax rates very dramatically. President
John F. Kennedy recognized the economic benefits of lowering taxes, so
in his State of the Union Address on January 14, 1963, President
Kennedy spoke of the need to increase economic growth and job creation.
He stated:
To achieve these greater gains, one step, above all, is
essential--the enactment this year of a substantial reduction
and revision in the Federal income taxes . . . A net
reduction in tax liabilities . . . will increase the
purchasing power of American families and business enterprise
in every tax bracket.
He further stated:
It will, in addition, encourage the addition and risk-
taking on which our free enterprise system depends--induce
more investment, production, and capacity use . . . and
reinforce the American principle of additional reward for
additional effort.
It is worth repeating. President Kennedy pushed for lowering Federal
income taxes to encourage initiative and risk-taking to induce
investment, production, and economic growth. President Kennedy
recognized and believed in the American principle of additional reward
for additional effort.
It seems to me, from the speeches that have been made recently, that
our President--meaning President Obama--disagrees. It seems to me that
he argues innovators and job creators should be subjected to punitive
tax increases for being successful. He seems to believe economic growth
will come by confiscating the wealth of job creators and sending that
money to Washington, and I could not disagree more.
For Americans to prosper, we must first reduce the size of
government. This year the Federal Government will spend about 24
percent of our gross domestic product. This type of spending has led to
annual deficits above $1 trillion for the past 3 years. The total debt
stands at over $15 trillion. This is 100 percent of our gross domestic
product. The size of government, the size of deficits, the size of
debt, and the size of interest payments are unsustainable over the long
haul. We must reverse course.
Second, we must work to reform the Tax Code to provide certainty and
predictability. Nearly every day our President is on the campaign trail
talking about tax increases. It is no wonder our job creators,
particularly small businesses, are reluctant to make business decisions
or investments in this climate, which decisions we would hope if they
would make them would obviously lead to a great deal of job creation in
the private sector. This country doesn't need more taxes, we need more
taxpayers, and the way to get more taxpayers is to have more people
working.
The President's threat of higher taxes is directly inhibiting job
growth and economic expansion. It is time for President Obama to
recognize that with 13 million Americans unemployed and anemic economic
growth, tax increases will harm, not help, economic recovery.
Finally, we had a recent Gallup poll finding that compliance with
government regulations is the single biggest issue facing small
business owners today. You might think we would emphasize the Fortune
500 big corporations when it comes to creating jobs, but we know that
70 percent of the new jobs in America are created by small business, so
we ought to be concentrating on what small business people are telling
us about the economy not turning around.
Small business owners, when it comes from the standpoint of
regulations, need to spend less time and money making sure they comply
with burdensome and needless Washington regulations. Those valuable
resources should be spent growing their business, hiring more workers,
and as a result growing our economy. We must halt the Federal
Government regulations binge. For many of these new regulations, the
cost of compliance outweighs the public benefit. They are acting like a
wet blanket on our economy. There should be a moratorium on new
regulations.
I want to give you a perfect example that is now an issue before the
Congress, the Keystone XL Pipeline. At a time of high unemployment and
energy costs, the Federal Government should not be standing in the way
of private investment that will create jobs and increase our energy
supply. It is unconscionable that the largest private shovel-ready
construction project is being delayed by President Obama's decision to
override two different studies by the State Department and that there
was no negative environmental impact. It seems the only jobs President
Obama is interested in creating are government jobs or government-
subsidized jobs. The unfounded delay should be ended and the pipeline
project should move ahead.
This situation typifies the Obama philosophy that the free market and
intelligent Americans are incapable of making informed decisions. The
argument we hear is that Americans are not smart enough to know we need
solar energy rather than fossil fuels. So our big government caretaker
uses \1/2\ billion in taxpayer dollars to support a solar company while
simultaneously blocking an entirely private enterprise from developing
an oil pipeline that will make us much more energy independent. We have
seen how the decision by the government elite to support
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Solyndra has worked out. It was a complete failure.
It is time we got out of the way of the Keystone Pipeline. I hope the
American people will dismiss the economic theories and visions of our
President as he seeks to divide our country. I believe we can achieve a
prosperous future by empowering individuals rather than our Federal
Government. Americans are smart enough to put their trust in themselves
and their neighbors, not in bigger government. It is time to end the
political blame game and divisive rhetoric and, instead, work on
genuine and real policies that will create economic jobs and, more
importantly, economic growth that is going to help all Americans; in
other words, expanding the economy because this does not have to be a
zero sum gain. We can have more for more people, and if we don't have
more for more people, we are going to have less for more people and
everybody is going to lose out.
Mr. MERKLEY. Mr. President, we are in the midst of an important
debate over whether we will allow all working Americans to be hit with
a big tax increase next year.
This is a critical measure of relief for our working families in
these tough times. During the aftermath of the most severe recession
since the Great Depression, many middle-class Americans cannot afford
to lose the $1,000 the average family receives from this tax cut.
Furthermore, economists across the spectrum believe that extending the
payroll tax cut is a critical step in building momentum toward a
stronger recovery and minimizing the chances that our economy could
slip back into recession.
While keeping working Americans from being hit with this tax increase
is our first and most important priority, we must also look to what is
best for our economy when deciding on offsets for the cost. The offset
in the bill that we voted on 2 weeks ago made good sense: asking
millionaires and billionaires to fund a fairer share of our national
budget. I am concerned, however, about a new offset provision in S.
1944 that increases the guarantee fee on mortgages backed by Fannie Mae
and Freddie Mac. I am very wary of placing additional costs on new
mortgages given the ongoing crisis in the housing and mortgage markets.
Moreover, if there is such a fee increase, it should be used to
strengthen our battered housing market.
I look forward to discussing other offsets with my colleagues as we
continue this debate. This much is clear: Keeping this tax cut in place
is a huge factor in the success of our working families and a huge
factor in the recovery of our economy.
I yield the floor.
The PRESIDING OFFICER. The Senator from Maryland.
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