[Congressional Record Volume 167, Number 129 (Thursday, July 22, 2021)]
[Senate]
[Page S5032]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              THE ECONOMY

  Mr. THUNE. Mr. President, inflation is on the rise. Inflation in June 
was at its highest level in 13 years. Consumers are facing the effects: 
higher prices.
  Americans are facing increases in rent, in their restaurant bills, in 
their grocery bills, gas prices, and the list goes on.
  Want to buy a used car?
  Expect to pay a lot more money than you would a year ago.
  Inflation happens when the amount of money out there exceeds the 
supply of products. When that happens, when demand outstrips supply, 
prices increase. And that is what we are seeing now. It is being 
aggravated by Democrats' decision this spring to flood the country with 
unnecessary money.
  During times of crisis, there is a place for increased government 
spending. The money the government invested in COVID vaccines, for 
example; the forgivable loans provided to small businesses to help them 
weather the pandemic; and the increased assistance to hospitals and 
healthcare providers as the crisis escalated.
  But crisis spending is for just that, a crisis, or at least it should 
be. Unfortunately, Democrats have never met a temporary government 
dollar that they didn't want to keep spending. ``Temporary'' government 
programs aren't really a thing for my friends across the aisle.
  And so as the crisis was waning and our economy was rebounding, 
Democrats doubled down on the crisis spending and passed a massive 
COVID relief bill filled with unnecessary handouts; hundreds of 
billions of dollars for State governments, the majority of whom were 
doing just fine without it. In fact, many running surpluses. Tens of 
billions more for schools who had barely made a dent in the billions of 
dollars they had already been given.
  Republicans and at least one liberal economist warned that Democrats' 
massive spending plan could overstimulate the economy, but Democrats 
didn't listen. So it is no surprise that the flood of unnecessary 
government dollars is currently helping to boost inflation.
  Here is the kicker, Mr. President. After flooding the economy with 
unnecessary money, Democrats are now preparing to double down on that 
strategy. That is right. Despite passing a largely unnecessary $1.9 
trillion bill just 4 months ago, Democrats now want to spend an 
additional $3.5 trillion--$3.5 trillion.
  The truth is that number is likely to be even higher, a lot higher. 
One estimate suggests that the $3.5 trillion is likely to be more like 
$5 trillion or $5.5 trillion. That is from an independent analysis by 
the Committee for a Responsible Federal Budget, where President Biden's 
own Treasury Secretary used to serve on the board. That is an 
inconceivably large amount of money.
  To put that number in perspective, the entire Federal budget for 2019 
was less than $4.5 trillion--the entire Federal budget. So Democrats 
are just casually tossing out a new spending bill that might very well 
exceed the entire Federal budget in 2019.
  I can assure Americans that that much money would fuel increased 
inflation. Consumers would continue to be squeezed by rising prices and 
watch the value of their salaries decrease.
  But the damage would not be just limited to the effects of inflation. 
Americans would also suffer as a result of the massive tax hikes 
Democrats are envisioning. Democrats plan to pay for all or some of 
their spending by raising taxes left and right on small businesses, 
large businesses, investment, well-off Americans. All of them and more 
will see tax increases under Democrats' plans.
  The President, of course, likes to repeat his mantra that he won't 
raise taxes on those making under $400,000. In fact, that isn't really 
true, as the President's plans for a second death tax will undoubtedly 
hit middle-class Americans.
  While it is true that the President won't be raising income taxes on 
Americans making less than $400,000 a year, middle-class Americans will 
unquestionably bear a substantial part of the burden of his tax hikes 
because raising taxes, any taxes, has consequences for everyone.
  Democrats like to pretend that raising taxes is a consequence-free 
enterprise, but that isn't even close to being the truth. It doesn't 
take an economics degree to recognize that. It is common sense. Raise 
taxes enough on anyone or any business and that individual's behavior 
or that business's behavior is going to change. A business facing a 
substantial tax hike may raise prices; it may freeze salaries; or it 
may not hire as many new workers, and all of those decisions will be 
felt by ordinary Americans.

  Think about it. If a business raises prices to deal with the impact 
of a tax hike, who is going to feel it the most? Ordinary Americans on 
a budget.
  What is more, most Americans, if they are not self-employed or 
working for government, are employed by businesses, and if the business 
they work for isn't doing well, their prospects are going to be 
significantly affected. If businesses hold down wages to deal with the 
impact of tax hikes, for example, ordinary Americans' long-term earning 
potential will be diminished. These effects may not sound as concrete 
as being handed a tax bill, but they have just as real of an impact on 
Americans' incomes and Americans' lives.
  Studies suggest that 50 to 70 percent or more of the burden of 
corporate tax hikes is borne by workers in the form of things like 
lower wages. Combine Democrats' proposed business tax hikes with their 
massive proposed increase in the capital gains tax, which would chill 
the investment that helps drive job creation, and you have a recipe for 
permanently diminished economic growth and a permanent reduction in 
opportunity for American workers.
  If Democrats received any mandate in the last election, it was a 
mandate for moderation, for compromise, for bipartisan cooperation. Yet 
Democrats are behaving as if they had received a mandate for a partisan 
revolution. They are busy driving the country down the road to 
socialism with a massive and permanent expansion in the size of 
government, and their reckless tax-and-spending spree will hurt the 
very Americans they claim to want to help.
  I hope some of my colleagues on the other side of the aisle will put 
the brakes on their party before the Democrats' massive spending spree 
ends in economic disaster for the American people.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Virginia.

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