[Congressional Record Volume 167, Number 192 (Tuesday, November 2, 2021)]
[Senate]
[Pages S7594-S7595]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                              The Economy

  Mr. PORTMAN. Mr. President, since the Democratic leadership and the 
Biden administration first proposed the massive tax-and-spend 
legislation called reconciliation 7 weeks ago, I have come to the floor 
every week to explain what is in this massive tax-and-spend proposal 
and why I believe it is wrong for the economy at a time of high 
inflation, low economic growth, and record levels of debt.
  Before I talk about that, though, I think it is important to consider 
where we have been, how things could be better. Before the pandemic 
began, back in February of 2020--largely thanks to commonsense, pro-
growth tax reform that was passed in 2017 by Republicans here in the 
Congress and the Trump administration--we had one of the strongest 
economies we had ever seen. We had 19 straight months, in February of 
2020, of wage growth over 3 percent on an annual basis--19 straight 
months of wage growth, real wage growth, above inflation--by the way, 
most of it benefiting lower and middle-income Americans.
  We had the lowest poverty rate in the history of our country since we 
started keeping track of it back in the 1950s. Blacks and Hispanics had 
the lowest unemployment rate ever. Overall, we had the lowest 
unemployment rate in 50 years. It was an opportunity economy. We need 
to get back to that.
  Then, of course, as everyone remembers, we had to deal with the 
effects of COVID-19, including shutting down much of the economy. 
Luckily, we now have vaccines that are making it possible for us to 
return to a relatively normal lifestyle.
  But there is one big problem. While the pandemic is finally starting 
to fade, the economy is being seriously challenged by extremely high 
inflation.
  Don't take my word for it. Here is what the data says. The latest 
Consumer Price Index jumped to one of the largest increases in 13 
years, to 5.4 percent. That means people are paying more for 
everything. The latest Producer Price Index went up too. That means the 
folks who produce the goods are paying more to put them on the shelf.
  Real wages are actually down because, adjusted for inflation, wages 
are down by an average of 1.7 percent during the Biden administration. 
So people back home tell me: I got a wage gain, Rob, but I am not 
feeling it because inflation is eating up all the gain I got.
  Wage increases may be out there, but they are not above inflation. 
The response by Washington has been unprecedented, what is called 
stimulus spending. It is like adding fuel to the fire. Stimulus 
spending at a time when demand was already increasing and the economy 
was already rebounding has been a recipe for inflation, and that is 
exactly what has happened.
  Unfortunately, contrary to what the White House has said--which is 
that this is going to be transitory, in other words, temporary--it 
looks like it is here to stay for a while. And middle-class families, 
of course, are feeling the squeeze.
  We are paying 42 percent more at the pump--42 percent higher this 
year than last year. It now costs almost a hundred bucks to fill up a 
pickup truck. I know that because I filled up mine in Ohio recently--
$85.
  I just can't believe that, here in Congress, we are thinking about 
passing additional legislation to make inflation even worse. Everything 
is up. Natural gas is expected to rise in that 40 percent range, just 
as the winter heating season kicks into high gear. And it is not just 
fuel costs. It is groceries. It is furniture. It is everything.
  Thanksgiving is just around the corner. Here is the report from the 
New York Times. And I read their lead: ``Thanksgiving 2021 could be the 
most expensive meal in the history of the holiday.''
  They are saying that because everything has gone up. The cost of 
turkeys has gone up double digits, the cost of pumpkin pie, the cost of 
everything that people are having to buy for Thanksgiving.
  Unfortunately, the actions of this Democratic Congress are a big 
part, again, of why this inflation is so high. Back at the beginning of 
the year, Democrats passed a $1.9 trillion COVID relief bill that 
mostly did not deal with COVID, but it did provide the most stimulus 
spending to our economy ever in the history of the Congress. This 
stimulus spending essentially primed the pump on an economy that was 
already recovering nicely.
  Multiple nonpartisan groups, including the Congressional Budget 
Office here on Capitol Hill, told us that the economy was improving 
already. In fact, CBO said that the economy was recovering and it would 
recover to its prepandemic levels by midyear. That was by June 30 of 
this year. Many of us tried to warn that if we overheated the economy, 
spent more money to prime that pump, that it would result in more 
inflation.
  And it wasn't just Republicans. Larry Summers, who served as Treasury 
Secretary under President Clinton and served as National Economic 
Adviser for President Obama, basically said that. He warned that 
injecting so much money into the economy would lead to inflation. And, 
of course, it is lower income and middle-income Americans who get hurt 
the worst.
  It is basically a hidden tax. As I mentioned earlier, the annual 
inflation rate last month was 5.4 percent, but everything I am seeing 
is double-digit inflation this year compared to last year. But if your 
wage rate is below that, if your wage increase is below that--maybe you 
received a 3-percent wage increase--it is actually going to be harder 
for you to be able to afford what you need for you and your family.
  In other words, not too long after we enjoyed a record stretch of 
wage growth, prepandemic, that primarily benefited lower and middle-
income workers, we are now seeing just the opposite: a pay cut for 
everyday Americans.
  What do we need to do to address this? Well, stop the stimulus 
spending because that is helping to fuel this inflation.
  There are two major bills that Congress is considering right now. One 
would help, and one would make matters worse.
  What are they?
  Well, the first is the bipartisan infrastructure bill. It passed the 
Senate in early August with significant bipartisan support. That is 
unusual around here, particularly for a bill as significant as this, 
but we worked to ensure that the bill was one that both sides could 
support.
  And it makes too much sense for it not to become law. It will help 
fix our Nation's crumbling infrastructure. It will fix our roads, our 
bridges, our rail systems, and our ports, which are particularly 
important right now given the supply chain issues that our country is 
experiencing.
  It will also help upgrade our digital infrastructure. High-sped 
internet will now be available to kids so they can learn, so people can 
get their healthcare online, so people who want to start a business can 
do so. It will boost our Nation's ability to provide that kind of high-
speed broadband, particularly in our rural areas.
  Importantly, thoughtful, conservative economists like Michael Strain 
at the American Enterprise Institute and Douglas Holtz-Eakin at the 
American Action Forum will tell you that this bipartisan infrastructure 
bill is counterinflationary; in other words, it will push back against 
inflation. Why? Because it adds to the supply side of our economy, as 
they will say. It contributes to our Nation's long-term growth because 
it makes long-term investment in hard assets. Think of that bridge in 
your State or your community that needs to be fixed. That spending 
won't happen in the next year, but it will happen over 5, 10, maybe 15 
years, and it will lead to a more efficient and productive economy.
  It also will make us more competitive against countries like China, 
which currently spends more than four times as much as we do on 
infrastructure as a percent of their GDP. Why? Because they want to get 
ahead.
  The bipartisan infrastructure bill also has no tax increases. Let me 
repeat that. Unlike the second bill we are going to talk about, the 
bipartisan infrastructure bill has no tax increases on the economy.

[[Page S7595]]

  It is no surprise that polling data from CBS News, CNBC, and others 
shows that the vast majority of Americans--in this case, 87 percent in 
these two polls--support investing in and improving our infrastructure.
  For these reasons, the House of Representatives needs to pass this 
bill without delay and help us achieve this win for the American 
people. It has been almost 3 months since the legislation passed here 
in the U.S. Senate--almost 3 months. It passed by a vote of 69 to 30.
  It is now being held up by progressives in the House of 
Representatives who want the second bill--the massive tax-and-spend 
bill, the reconciliation bill--more than they want the infrastructure 
bill. So they are holding the infrastructure bill hostage, thinking 
that somehow that will enable them to get more moderate Democrats to 
support the massive tax-and-spend bill. I don't think that is going to 
happen, but, meanwhile, they are hurting the American people by holding 
it hostage.
  The second bill that Democrats are contemplating, which is the 
reconciliation bill, a massive tax-and-spend bill, would inject at 
least $2 trillion more in largely stimulus funding into an already 
overheated economy. In order to try to pay for it, it also includes 
significant tax increases that will hurt economic growth and jobs.
  Democrats claim they are taxing the rich and corporations to pay for 
it, but we shouldn't be fooled. The middle class will bear the brunt of 
what they are proposing, as they always do.
  As an example, the proposed Medicare surcharge on active investment 
income will hit the millions of small businesses that structured 
themselves as pass-through entities, as the vast majority do, with an 
across-the-board 3.8-percent increase on all income.
  Proposed corporate tax increases will hit American workers, based on 
the analyses of the nonpartisan Congressional Budget Office and the 
nonpartisan Joint Committee on Taxation. It is very simple. When you 
tax a company, the workers end up taking the brunt of it. About 70 
percent of the benefit of the tax cuts and about 70 percent of the 
detriment of the tax increases goes to worker wages and benefits. Costs 
will be passed down to working families in the form of even lower wages 
and even more inflation, which means higher prices for everything.
  That is bad for the families that I represent. Any objective analysis 
will show that this massive tax-and-spend bill will actually cost a lot 
more than advertised.
  Why do I say that? Because it uses some budget gimmicks to be able to 
make the cost of the bill look like less.
  Based on a new study that just came out by the Penn Wharton folks, if 
benefit programs put in place by the bill--let's say the child tax 
credit--increase and are not sunset in the 10-year window, then the 
cost goes from $1.75 trillion to $3.98 trillion. In other words, if you 
just assume that we are not going to sunset things like the child tax 
credit, the cost goes to almost $4 trillion.
  Democrats are proposing to end these new benefits partway through 
their 10-year window to help keep the costs down, knowing full well 
that, historically, benefit programs like this are not ended but always 
extended.
  So, taking away the budget gimmicks, the cost of this massive tax-
and-spend bill gets it closer to $4 trillion. By the way, that is more 
than twice as much as Congress has ever spent on a spending bill in the 
history of our country.
  I strongly urge President Biden and Democrats in Congress to slow 
down this process at a time of high inflation, record debt, and 
consider the devastating economic consequences of what they are 
proposing. This increased spending, combined with job-killing tax 
increases, could lead to the kind of stagflation, as they called it, 
that we had back in the 1970s: low growth, high interest rates, high 
inflation. We never want to go back there. Yet, if we don't change 
course, we could be heading in that direction.
  Here is a better solution. Just pass the right bill: the bipartisan, 
pro-growth infrastructure bill that has been stuck in the House of 
Representatives for almost 3 months. President Biden has said he will 
sign it into law. It would be a victory for the American people.
  Stop holding it hostage. Instead of holding it hostage, do something 
good for our infrastructure, which everyone relies on--good for our 
economy, good for American families, and good for the country right 
now.
  As we approach the Thanksgiving holiday, it would be a needed 
bipartisan victory for which all of us--Republican and Democrat alike--
could give thanks.
  I yield the floor.
  The PRESIDING OFFICER (Ms. Hassan). The Senator from Michigan.

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