[Congressional Record (Bound Edition), Volume 148 (2002), Part 1]
[Senate]
[Page 702]
[From the U.S. Government Publishing Office, www.gpo.gov]




                 NEED FOR AN ECONOMIC STIMULUS PACKAGE

  Mr. BYRD. Mr. President, over four months after the idea was 
originally proposed, the Senate remains divided on an economic stimulus 
package.
  Much has changed since an economic stimulus was first proposed in 
response to the September 11 attacks. Both the stock markets and the 
economy have proved to be more resilient than economists had expected.
  Moreover, there are signs, as Federal Reserve Chairman Alan Greenspan 
told the Budget Committee last month, that some of the forces that have 
been restraining the economy over the past year are starting to loosen 
their strangle hold. The Fed Chairman told the Committee that ``while 3 
months ago, [a stimulus package] was clearly a desirable action . . . I 
do not think it is a critically important issue to do. I think the 
economy will recover in any event.''
  Aside from the positive economic data that have been released by 
government agencies in recent weeks, there is already a significant 
amount of stimulus in the pipelines.
  That's not to say that we are home free. As Chairman Greenspan 
pointed out last month, the economy could go either way at this point. 
Most troubling is the higher unemployment rate since last year.
  However, we must not delude ourselves into thinking that an economic 
stimulus package--whether crafted by Democrats or Republicans--is some 
sort of panacea. Stimulus packages can't work miracles. We have a $10 
trillion economy. That's gross domestic product--the total of all 
spending. We cannot flip the economy over like a pancake. A boost of 
$70 billion to $100 billion would amount to less than 1 percent of GDP.
  Nobody can say at this point with certainty in which direction the 
economy is headed.
  What we know is that, since the recession began last March, the Labor 
Department reports that 1.8 million workers have lost their jobs. We 
could address this problem by temporarily extending unemployment 
insurance.
  What we do not know, is whether a more comprehensive stimulus package 
at this point is really necessary.
  I submit that the danger we face is not that the economy won't turn 
around--inevitably it will--but that we may unnecessarily worsen our 
budgetary position by taking unnecessary, but politically popular, 
action on a so-called ``stimulus package.''
  Any stimulus package, at least in the short-term, will increase the 
projected budget deficits for fiscal years 2002 and 2003. We may well 
need to devote more resources to our military overseas and to homeland 
defense, and we will have to bear the costs of doing so.
  The erosion in the budget picture over the past year, along with the 
defense and homeland security demands placed on our budget and the 
inevitable long-term Social Security and Medicare deficits 
overshadowing the retirement of the baby-boomers, suggests that tough 
choices must be made as to whether the limited dollars we spend will 
provide a worthwhile return on our investment. From what we have seen 
from experts ranging from the Federal Reserve Chairman, to 
Congressional Budget Office officials, to private-sector economists, a 
stimulus package does not meet that test.

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