[Congressional Record Volume 167, Number 183 (Tuesday, October 19, 2021)]
[Senate]
[Pages S7084-S7087]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              THE ECONOMY

  Mr. PORTMAN. Madam President, I am here on the floor this evening to 
talk about the troubling state of our economy today and what needs to 
be done to get it back on track. The Labor Department reported last 
week that the consumer price index, CPI, rose by 5.4 percent on an 
annualized basis. That accounts for the largest year-to-year 
inflationary increase in 13 years.
  And we are feeling it. There is no question inflation is on the rise. 
We are paying more for everything--from groceries, to buying furniture, 
to cars, even pumpkins for Halloween. Yes, the U.S. Department of 
Agriculture just told us that pumpkins, year to year, are going to see 
an, on average, 15.7-percent increase in prices. So you might have to 
get a little smaller pumpkin this year.
  And, of course, we are paying more at the pump, on average, a 
staggering 42-percent increase this year--42-percent increase. This is 
both because of increased demand but also because there is less supply 
as the new administration, the Biden administration, has put more 
regulations or handcuffs on American energy production.
  And don't forget the higher heating bills, about 25 percent higher 
this year as compared to last year. Just as this cooler weather begins 
to come in, we are all going to be paying more on our utility bills, 
particularly for natural gas.
  If all this isn't bad enough, workers' wages are not keeping up with 
these price spikes. I love to see wages going

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up, but honestly, if you look at the data, it says that since President 
Biden took office, wages after inflation, adjusted for inflation, are 
down almost 2 percent--1.9 percent lower.
  Remember, before the pandemic started, in February of 2020, we had 
the 19th straight month of wage increases of 3 percent or more on an 
annualized basis, well above inflation. Now, we are seeing just the 
opposite. This means a pay cut to the middle class.
  The damaging effect of this hidden inflation is, in part, the result 
of actions that were taken by the Biden administration and by Democrats 
here in Congress to overheat the economy through unprecedented levels 
of government spending.
  What do I mean by that? Well, you will recall that economist and 
former Secretary of the Treasury in the Clinton and Obama 
administrations, Larry Summers, said earlier this year, as Democrats 
were talking about this huge new spending bill that they ended up 
passing without a single Republican input or vote in March, he said: If 
you do this, it is going to cause inflation. He warned about it because 
he had seen this movie before.
  When you have got an economy that is already improving and you 
overheat it with massive amounts of stimulus--remember, the $1.9 
trillion that was spent in March was the highest level ever spent. It 
was the biggest program ever passed by either House of Congress, $1.9 
trillion. We forget how much money that is.
  He recognized that this bill contained billions in stimulus money, 
social service spending, the stimulus checks. And those were going to 
fuel the demand side of the economy. And they did--not just the 
stimulus checks but other things as well: COVID funds to all kinds of 
institutions, a continuing generous unemployment supplement that paid 
42 percent of American workers more to go on unemployment than to go 
back to work.
  All of this added up to a huge influx of social spending, government 
spending--borrowed money but government spending--into the economy that 
everyone who was looking at it objectively, I believe, knew was going 
to be a problem.
  Earlier this year, before the Democrats passed this $1.9 trillion 
spending bill, the nonpartisan Congressional Budget Office here on 
Capitol Hill told us that the economy was already recovering, and that 
is what outside economists were saying as well. Everybody was looking 
at the economy and saying, you know, in January, February, going into 
March, the economy was improving nicely. In fact, the Congressional 
Budget Office--again, nonpartisan group up here--said the economy is 
going to get back to its prepandemic level by midyear, by June 30. And 
it did.
  The stimulus was really poorly timed. Instead of allowing the 
recovery to continue steadily, it effectively poured fuel on an already 
hot economy, which led to the surging inflation we are seeing now. The 
White House likes to say that the inflation we are experiencing is 
transitory. That is the word that they have been using; in other words, 
it will pass--as Congress passes more legislation to fix the economy, I 
suppose. Unfortunately, it has not been transitory.
  And I haven't seen anybody who is looking at this objectively say 
that it will be transitory. In fact, I saw an analysis today from an 
outside group, a nonpartisan group, that said they are, unfortunately, 
convinced that this high inflation is going to continue next year as 
well. I hope that is not true, but that seems to be the consensus. 
Economists across the spectrum, even the International Monetary Fund, 
are now saying that rising inflation is dampening future economic 
growth.
  You would think all of this would cause a policy shift by the 
administration, a pulling back on the stimulus, doing things to 
actually help on the supply side of the economy. But rather than 
changing course from the policies that contributed to this high 
inflation and this demand-side stimulus, Democrats want to double down 
with a $3.5-trillion-plus massive tax-and-spending spree that would 
spend trillions to fund social programs, expand government 
entitlements, and encourage more consumer demand, fueling more 
inflation.

  What makes this proposal even more concerning is Democrats want to 
pay for it by hurting the economy more with big tax increases. Some say 
it is the biggest tax increase in 50 years. Some say it is the largest 
tax increase in history. It depends, I guess, where they end up. But we 
know it will increase taxes on pretty much everybody.
  The Joint Committee on Taxation has done an analysis and said, yes, 
it is going to increase taxes on middle-income workers. Why? Because it 
increases taxes on businesses and they say that about 70 percent of 
that tax increase will be borne by workers. That is, again, the 
nonpartisan Joint Committee on Taxation. So it is taxes not just on 
businesses, large and small, but it is also on workers, on farmers, on 
manufacturers.
  This increased spending, combined with job-killing tax increases, 
could lead to the kind of stagflation, low growth, high interest rates, 
high inflation that we had back in the 1970s. We hoped never to see 
that again; yet if we don't change course, we could be heading toward 
that direction. It is the last thing our economy needs right now.
  But surging consumer demand is not the only factor driving our 
current inflation crisis. The other main culprit is that we are facing 
a shortage of goods due to a global supply chain crisis. Almost anyone 
you talk to will tell you they have had some kind of shipping delay due 
to these supply chain issues. There are contractors you probably know 
who can't get lumber, can't get steel to be able to finish a building, 
a home.
  There are plenty of parents out there right now waiting to get their 
kid a gift for their birthday, only to find out that, no matter how 
much they pay, it is going to arrive not for the birthday but maybe 2 
or 3 months later.
  These issues are clearly visible if you look at our seaports, which 
are often the main connecter between our country and the main global 
supply chain, consisting of manufacturers often in Asia, sometimes in 
China. Just last week, there were about 60 or 70 ships in a holding 
pattern near the ports of Long Beach and Los Angeles, CA. Think about 
that: 60 or 70 huge container ships just in a holding pattern, not 
being able to get in.
  And even when the shipping containers are taken on shore, by the way, 
there aren't enough trucks to pick them up. So the containers are 
staying at the port. There aren't enough truck drivers because of the 
labor shortage. By the way, that is driven in part by this increased 
demand but in part by some of the rules and regulations around those 
transportation logistics and truckers.
  Between bottlenecks and backlogs at our ports and challenges in 
transporting freight, there is real trouble for our supply chains just 
as we come into the holiday season, which is typically, of course, when 
people do most of their shopping. One reason for this global supply 
chain crisis is the ripple effects of COVID-19. No question about that. 
When factories shut down their operations to stem the flow of COVID 
among their workers, assembly lines sometimes stopped working 
altogether and created the shortage of goods and materials.
  The companies that work in the shipping industry also were hit hard 
by the pandemic and had some of their operations negatively impacted. 
But then the pent-up demand for goods and services kicked in, and, 
again, much more demand was created by the $1.9 trillion spending bill 
in March of this year than would have been normal.
  So, yeah, you had some of these factories shutting down; you had 
essential workers still working; but you had less production and then 
all of a sudden this big surge and, therefore, the bottleneck.
  Some in the Biden administration have said that this inflation and 
supply chain bottleneck is a problem for the rich. I don't see it that 
way. If they think that, they ought to talk to the factory workers I 
talked to in Ohio whose wages are being eaten up by inflation. I think 
they should say that to the mother or father who is having to ask their 
kid what gift they want for Christmas 2 or 3 months ahead of time. In 
fact, it is too late already to get some gifts for Christmas even now.
  A recent college graduate who is trying to fill her car up with gas 
to get to work--tell it to her that this is a problem for the rich--a 
42-percent increase in gas prices this year.

[[Page S7086]]

  The supply chain is like any other chain. If you have one weak link, 
it is enough to cause the whole thing to fall apart, and that is 
exactly what has happened, and it is happening at the worst possible 
time. Part of the near-term solution is to stop any new stimulus 
spending. That is not what is needed right now in the economy. It is 
just terrible timing.
  And stop the new tax increases because that is also what we don't 
need in our economy right now. We don't want to make America and 
American workers less competitive; we want to do just the opposite.
  And part of the long-term solution to prevent a similar crisis from 
happening in the future is to shore up our supply chains. Instead of 
being so reliant on manufacturers from places like China, bring the 
manufacturing home; reshore it; invest more in production here in the 
United States. In the process, create more domestic manufacturing and 
transport jobs and greater supply chain security.
  I think that is going to start happening. If you look at the cost to 
bring a product from Asia to the United States now, it has skyrocketed. 
That gives us a competitive advantage. The market is here. We ought to 
bring the manufacturing here as well.
  Another solution is to improve our Nation's infrastructure. Targeted 
investments in increasing the capacity and operability of our ports, 
our waterways, fixing our roads and bridges, improving our railways, 
that all makes sense. For decades, we have neglected our infrastructure 
needs. Every President, by the way, in modern times has said that.
  You know, the society of engineers who look at our infrastructure 
says that we have a grade of somewhere between D-plus and C-minus in 
this country. We are falling behind other countries. Other countries 
spend a lot more as a percent of their GDP on infrastructure. And it 
has been recognized.
  Really, every President since from Bill Clinton to Donald Trump has 
said: Let's make a significant investment in infrastructure. Yet we 
didn't do it. We neglected our infrastructure. We have neglected our 
ports, and that is why they are so inefficient today in part and one 
reason we are having to pay the price.
  The good news is that right now there is a bipartisan infrastructure 
package awaiting passage in the House of Representatives to address 
this and other problems. It is called the Infrastructure Investment and 
Jobs Act. This is the bill that passed the U.S. Senate here in August 
with a 69-vote majority. That doesn't happen very often around here, 
particularly with big, important legislation like that.
  It was bipartisan from the start. It was passed with the support of 
Republicans here in this Chamber, Democrats in this Chamber, and, most 
importantly, the American people who think it is a really good idea.
  Economists think it is a good idea, too, because it improves the 
efficiency of our economy. Think about it. The bridge that is holding 
up traffic right now in my hometown of Cincinnati, OH, every day--a 
massive bridge where I-71 and 75 come together--it is a huge hit to our 
economy. It is also a huge safety problem. Fixing that bridge has been 
something people talked about for 30 years. It is time to do it, and we 
will do it if we can get this infrastructure bill passed.
  It will also create hundreds of thousands of good-paying jobs in 
industries ranging from construction and plumbing to electrical 
engineering and software development, with one recent study from the 
Association of Equipment Manufacturers finding that the legislation 
will create about a half a million jobs.
  It will also help address issues at our ports by providing increased 
funding for the Port Infrastructure Development Program, investments in 
our freight system through rail and waterway and highway and air 
freight investments. So it actually addresses a real problem we have 
right now.
  By the way, these investments are long-term investments. It won't be 
a lot of money spent in the next year or so; it will be a lot of money, 
though, spent over the next 5, 10, 15 years to improve this 
infrastructure. And they will be long-term assets that will last for 
decades. So it is a different kind of spending than the stimulus 
spending.
  All of this will help improve the movement of goods throughout our 
country. That is why every business group in America is supporting this 
legislation, not just the chamber of commerce but every group out 
there--by the way, as well as all the agriculture groups. Over 30 ag 
groups, including the American Farm Bureau, are supporting this 
legislation. It is why a lot of the union members are supporting it 
too. In fact, the AFL-CIO Building Trades Council is strongly in 
support of this legislation because they know it is going to create 
good-paying jobs, good benefits, allowing people to get out there and 
build things.
  Even more importantly, to me, given the recent economic news we have 
seen, this proposal will not cause inflation to increase. Why? Because 
it is spending on the supply side rather than the demand side of the 
economy, as economists would say. Conservative economist Doug Holtz-
Eakin, who is the former Director of the Congressional Budget Office, 
now head of the American Action Forum, and Michael Strain, who is the 
director of economic policy studies at the American Enterprise 
Institute, also a conservative scholar, have said that our bipartisan 
infrastructure package will slow down inflation. They said:

       Improving roads, bridges, and ports would make it less 
     costly for businesses to operate, allowing them to increase 
     their output per hour and putting downward pressure on 
     consumer prices.

  Again, this is long-term spending capital assets. It makes the 
economy more efficient; therefore, more productive. That is 
counterinflationary. So this is the right time to do this kind of 
project.
  To me, this bill makes all the sense in the world, given the trouble 
and uncertain stage of our economy. It gets relief to our supply 
chains. It makes long-term investments in hard assets that do boost our 
productivity in this country. It has a counterinflationary effect on 
the economy. So why hasn't it passed? What is the problem? Again, it 
got 69 votes here in the U.S. Senate. Well, unfortunately, the answer 
is politics. Democrats in the House of Representatives want to do 
everything they can to tie their big $3.5 trillion-plus tax-and-spend 
bill we talked about earlier to the infrastructure investment because 
they know that is the only way their partisan bill is going to get the 
votes needed to pass. So they held it hostage.
  Hard-core progressives don't like the bipartisan infrastructure bill 
because it doesn't have the tax increases; it doesn't haven't the Green 
New Deal policies; it doesn't have all the new social spending programs 
that are in this reconciliation bill that they really want.
  But holding this investment in infrastructure hostage to this larger 
tax-and-spend bill is just wrong. It is playing politics. And it is 
playing politics with the American people.
  It is also counter to the pledge that President Biden made to the 
bipartisan group that negotiated this agreement and made to the 
American people. President Biden supports this infrastructure 
legislation. He said he didn't get everything he wanted. Nobody did. 
But he supports it. He wants it to move forward. And he pledged to keep 
it separate--separate--from the $3.5 trillion tax-and-spend bill, and 
yet what you see in the House is just the opposite.
  It is not fair to the American people. They deserve to have the 
opportunity to have the infrastructure bill be voted on its own merits. 
Let it rise or fall on its own merits. Don't tie it to something else.
  House Speaker Nancy Pelosi promised it would come to the House floor 
about 6 weeks ago. She promised that to the so-called Democrat 
moderates in the House, and it didn't come to the floor. Then she 
promised it would come to the floor 3 weeks ago. It didn't come to the 
floor for a vote. Now she said, on October 2, that October 31 is the 
date. That is Halloween. That is a Sunday. But that is fine. We can 
vote on Sundays, even on Halloween. It is so important, we ought to do 
it--and do it.
  It is past time to take this bill to the floor of the House and let 
it be judged on its own merits. If passed, it will strengthen our 
economy over the long term and have a positive impact on the lives of 
every single American. It is counterinflationary. It makes our economy 
more efficient. It adds to,

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again, the supply side, allowing us to see not just a short-term boost 
but a longer term boost to our economy.
  And wouldn't it be nice to pass something that makes sense around 
here that is bipartisan? Instead of jamming Republicans and the country 
with another reckless spending bill and raising taxes on this uncertain 
economy, let's focus on the infrastructure bill that addresses real 
problems we face today. We could use a sensible, bipartisan success 
right now, all of us.
  I yield the floor.

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