[Congressional Record Volume 158, Number 20 (Tuesday, February 7, 2012)]
[Senate]
[Pages S368-S370]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE ECONOMY
Mr. DURBIN. Mr. President, the January jobs report shows that
President Obama and many others have joined to help put our economy on
the path to recovery. The economy added 257,000 private sector jobs in
January. That is the 23rd month in a row that the economy has added
private sector jobs, for a total of 3.7 million payroll jobs over that
same period.
In January, the unemployment rate fell again from 8.5 to 8.3 percent.
The unemployment rate has fallen .8 percent since August. That is the
first time in almost 17 years that the unemployment rate has fallen for
5 consecutive months.
Job growth is occurring across many sectors of our economy. In
Illinois, we are seeing manufacturing jobs return, some from overseas,
and across the country last month the manufacturing sector added 50,000
new good-paying jobs.
Don't get me wrong, we still have a long way to go. We have to
quickly agree on the extension of the payroll tax cut, which will
expire in just a few days. We have to ensure that unemployment benefits
for those looking for work are continued. We are on the right track,
but we shouldn't rest in our efforts to foster an economy that is built
to last.
I am not a deficit and debt denier. I understand the gravity of our
fiscal challenge, and we need to work to resolve these problems. I hope
my work on the President's fiscal commission and as part of the Gang of
6 shows a commitment to this issue. However, as Ben Bernanke, Chairman
of the Federal Reserve, said last week:
Even as fiscal policymakers address the urgent issue of
fiscal sustainability, they should take care not to
necessarily impede the current economic recovery.
Fortunately, the two goals of achieving long-term fiscal
sustainability and avoiding additional fiscal headwinds for
the current recovery are fully compatible--indeed, they are
mutually reinforcing.
On the one hand, a more robust recovery will lead to lower
deficits and debt in coming years. On the other hand, a plan
that clearly and credibly puts fiscal policy on a path to
sustainability could help keep longer-term interest rates low
and improve household and business confidence, thereby
supporting improved economic performance today.
We can grow our economy and reduce the deficit. In fact, it is
arguable that we can't balance our books or the budget with 14 million
people out of work. We have to work to put this economy back on its
feet, to put Americans back to work earning good incomes, paying their
fair share of taxes, and sustaining a growing economy.
A credible deficit reduction plan will include investments that look
to the future. Not only can we be fiscally responsible and still invest
in infrastructure, education, and innovation, we can only be fiscally
responsible if we do make those investments. Failing to invest in the
future is a recipe for more intractable fiscal problems in the years to
come.
Those who say just cut spending and ignore the consequences ignore
the reality. There are those who say that government spending is
holding our economy back. They say that if we cut government spending,
somehow we are going to enliven and rejuvenate this economy. History
tells us quite a different story. President Clinton presided over the
strongest period of private sector growth in recent memory, and he did
so while government spending grew every year from 1995 to 2000. In 3 of
those years, President Clinton generated a balanced budget--the last
balanced budget we have seen in Washington.
It is clear to me that we should be heartened by the recent positive
economic data, but we can't mistake it for a signal to retreat. We have
to continue working to build a strong and fiscally sound economy for
the 21st century. A critical element in that is unemployment insurance.
The January report, as I mentioned, says we are on the road to
recovery, adding 257,000 private sector jobs, with the unemployment
rate dipping from 8.5 to 8.3 percent. Even with these gains, more than
12\1/2\ million people are still unemployed and actively looking for
work. Even more concerning is the number of longer term unemployed,
which remains at about 5.5 million. The trouble finding work isn't due
to lack of initiative. We need more jobs. And until there are more jobs
available, we should maintain unemployment insurance benefits at
current levels.
Maintaining the current level of Federal unemployment insurance has
proven to be one of the best things Congress can do to breathe life
into this economy. The Congressional Budget Office--respected and
bipartisan--estimates that every dollar we put into unemployment
insurance not only goes into the economy but is respent and is worth
$1.90 in economic activity. Late last year, the Economic Policy
Institute estimated that extending Federal unemployment benefits for 1
additional year generates $72 billion in economic growth, creating over
560,000 jobs over the course of the year.
An estimated 3.2 million people were kept out of poverty simply
because of unemployment insurance checks. As of the end of last year,
200,000 individuals were collecting unemployment in Illinois, with 43
percent of those unemployed people having children in their homes.
I came to the floor today to reinforce for my colleagues and the
conferees working on the payroll tax-unemployment insurance bill that
this isn't just about numbers, it is about real lives.
I received a letter from Laurel in December, who does a far better
job of illustrating the role of unemployment benefits than anything I
can say. Here is what Laurel wrote:
Thank you for working late nights. I am from Evanston, IL.
I graduated from Evanston Township High School. My position
as Ethics and Compliance Manager in a large multi-national
conglomerate was eliminated last December 2010.
I am trained as a lawyer, and have worked in international
law, economics and policy. In addition to a law degree, I
have a Master of Science in International Relations from the
London School of Economics. I wrote my thesis about US trade
policy, the now expired Agreement on Textiles and Clothing,
and international economics and labor at LSE.
After working for a think tank in London on democracy and
participation, I went to law school. During law school, I
interned at the United Nations and later for the legal and
regulatory group of a Wall Street research service.
I was working in the legal department of Smiths Group on
international compliance issues when I was laid off. While
working for Smiths Group, I studied for an LLM in
international comparative law in the evenings.
After being laid off, I received severance from my previous
employer and was able to get a short-term contract with the
World Bank after only a few weeks of unemployment. However,
since the end of that contract in July, I have not been able
to find a job or get a contract.
My first phase of unemployment ended in November. I have
now been receiving unemployment insurance payments for 7
months, just beginning Phase II. If unemployment insurance
extensions are not renewed, I understand I will no longer
receive payments.
I am a 38-year-old single female living alone. My parents
are elderly, and my mother was just diagnosed with breast
cancer. My dad has had two strokes in the last 6 years.
I am paying $402 a month in COBRA payments to keep my
health insurance. I rent an apartment and unemployment just
barely covers my rent. I have been living on savings since
July. Without the help of unemployment, I will not be able to
pay my rent, and I am terrified.
I have had over 20 informational interviews and applied to
42 jobs since I first heard my job might be eliminated last
November.
The extension of unemployment insurance means something to
me personally. I need more time. I believe at least with some
of the applications I have submitted in both the private
sector and government agencies, the companies have not hired
anyone despite posting a job. I believe many companies are
waiting to see what will happen with government contracts,
and agencies are stalled due to the hiring freeze or funding.
I know something has to come through soon . . . I support the
efforts to support the extension of unemployment benefits.
Is this an example of someone who is not trying, someone who is not
trained and educated? Just the opposite. Here is a person who clearly
has been driven her entire life to develop skills, to challenge
herself, to improve her ability to earn and learn, and here she is out
of work and desperate. She doesn't know which way to turn. She is
single. She may not be able to pay her rent. Are unemployment benefits
important for her to keep her on the track of finding a job? Of course
they are. The money we give her will be spent back into the economy to
create a better economic climate.
[[Page S369]]
I have received thousands of letters along these lines in the last 2
years. If Congress doesn't move quickly to maintain unemployment
insurance benefits, millions of workers relying on this program will be
left without a lifeline. The Joint Economic Committee estimates that
3.3 million workers will exhaust benefits by June if we fail to act--
nearly 170,000 in Illinois. I am concerned about what this will do to
our country and especially what it will do to these people--our
neighbors, members of our families, friends, folks who just need a
helping hand.
Prematurely ending unemployment insurance or the payroll tax cut
would make our economic recovery more difficult. There may be some
political strategists who would applaud that, saying: Well, a little
bit of pain for a few months here and we can change that President into
another person. Let someone else take the job.
I think that is very shortsighted. Of course, I support the
President, make no mistake about it, but to sacrifice the well-being of
this country and the growth of our economy for the sake of an election
is just plain wrong.
Conferees in the Congress must act soon to maintain a robust
unemployment insurance system for those still struggling to find work.
Now is not the time to roll back unemployment insurance.
Marketplace Fairness Act
Mr. President, there is one other issue I would like to raise at this
point, and it is one I have worked on for some period of time with
Senator Mike Enzi. It relates to a phenomena all of us are aware of--
Internet sales. There is hardly an American with access to a computer
who doesn't buy something on the computer. I do, and lots of families
do--some of the basics, in addition to some other things that may be
just aspirational purchasing. But the interesting thing that has
happened over the years is we have allowed the Internet retailer to
have a different position when it comes to their tax liability.
I talked to a lot of local businesses in Illinois, small businesses,
businesses on Main Street. Some of them think things are getting better
and I do too. They sense the worst may be behind us and the future is
looking brighter. But at the same time, they share with me the
frustration they have currently now with customers coming into their
shops and businesses looking for everything from running shoes to
sporting equipment--you name it--and then, just about the time when
they have tried on the second or third pair of shoes, looked in the
mirror, got everything squared away as to what they are going to buy,
they sometimes pull out their phones, turn on an app, and take a
picture of the barcode on the product.
You see, there is an app which allows a person to find out where they
can buy that very same product cheapest on the Internet. So here is the
local retailer doing their part to make a sale, and it turns out they
get nothing from the experience.
What is the advantage that Internet sellers have over those who have
businesses on streets and highways across America? One advantage
relates to sales tax. In my home State of Illinois, the payment of
sales tax on Internet purchases is voluntary and personal. If one does
not declare it and pay it, it is not collected. We are supposed to pay
it, but many people do not. So those selling on the Internet, subject
to local sales tax, in fact are not collecting that sales tax. I think
that can change and should.
Becky Anderson owns Anderson Bookstores in Naperville, IL--a great
little town. She described to me how she loses sales every day because
consumers walk in, ask her questions, and then buy an item online from
remote retailers because they do not collect sales tax.
Becky understands most customers do not realize they do owe the sales
tax to the State of Illinois and local units of the government. They
say:
This runaway train may undermine more than our bottom
lines. It's not a stretch to say entire Main Street districts
could disappear.
That is Becky's conclusion after having watched what happens with
these Internet sales not collecting sales tax.
She talks about how a local shoestore in downtown Naperville was
forced to close and lay off employees, strictly because of Internet
sales. The local business owner, Michael Abt, president of Electronics,
in Glenview, IL, described in detail how our current system results in
a built-in price advantage for Internet retailers. Mike said:
Oftentimes with consumer electronics, the profit margin is
10 percent or less. Abt collects 9.25 percent sales tax. When
an online competitor does not collect it and then offers free
shipping, it is a huge advantage for [his] competition.
Local businesses will never be able to compete if we continue to
provide a built-in price advantage for online retailers by exempting
them from sales and use tax collection. There was a time, I guess--and
I heard the argument here--that we did not consider the sales tax for
online sales because, the argument was made, they may not survive; it
is a fledgling industry.
That day is long gone. They are certainly not fledgling; they are in
full flight.
Over the past decade, online retail has become an important part of
American commerce. Online retail allows customers to compare prices,
shop around right in the comfort of their living room. At the same
time, local businesses such as Anderson Bookstores in Naperville
compete with online retailers by trying to provide good service at the
lowest prices they can. These local businesses also invest in our
communities. They hire local workers. They pay local property taxes.
They are involved in communities supporting baseball teams and charity
efforts in their community. They are our neighbors and they deserve a
fair shake.
Last year, Senator Enzi, Lamar Alexander of Tennessee, and I joined
in introducing the Marketplace Fairness Act, with seven additional
cosponsors--Senators Tim Johnson, Boozman, Jack Reed, Blunt of
Missouri, Whitehouse, Corker and Pryor. We recently added Senators
Bennet and Cardin. This bipartisan group of Senators understands we
have to do more to ensure a fair marketplace for American businesses.
The bill will level the playing field for Main Street businesses and
limit the current built-in price advantage given to online retailers.
It allows States to treat brick and mortar retailers the same as online
retailers by providing two streamlined approaches for States to require
collection of both sales and use taxes.
The bill also includes a small seller exemption that will ensure
small online retailers are exempt from the requirement to collect sales
and use taxes. The notion is that if Grandma Franken has an apple
butter recipe and makes a few cases each year to the delight of all her
neighbors, she will not be burdened with this responsibility of selling
it online and collecting sales tax.
Let me be clear. This bill does not impose any new taxes. This bill
does not raise taxes, period. It does not amend the Internal Revenue
Code at all. It simply is a collection issue that for too long has put
local businesses at a disadvantage. The real job creators in America,
many of them, are the small businesses in our communities that struggle
to get by every day, and when they get better and they get well,
America gets well. Now is the time to help these retailers.
It also is going to help State and local budgets, those that are
trying to make ends meet in a tough economy. I hope we can get this
done and done quickly.
One thing I would like to add. The largest online retailer in
America, amazon.com, supports our legislation. We are not at war with
online retailers. They have concluded it is best to have a uniform,
streamlined system that uses available software for collection from a
retailer and distribution through the State departments of revenue. It
is voluntary. We do not impose a mandate on any State to adopt this,
although I think every one of them will, and this moves us finally in
the direction of fairness--fairness not only for those who are doing
the bricks and mortar sales but fairness for all customers and all
retailers across America.
I commend this bill to all colleagues. If we truly believe, as many
of us have spoken time and again, in the value of small business to
economic recovery, most small businesspeople will tell you this is a
critical element in their competitive edge and their ability to hire
more people and be able to be profitable all across the Nation.
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I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mr. Franken). The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. COATS. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER (Mrs. Shaheen). Without objection, it is so
ordered.
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