[Congressional Record (Bound Edition), Volume 149 (2003), Part 18]
[Senate]
[Pages 25388-25390]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              THE ECONOMY

  Mr. SMITH. Madam President, along with my colleague from the State of 
Idaho, I will talk in morning business about the economy. We have heard 
for 2\1/2\, nearly 3 years of the Bush Presidency that President Bush 
is responsible for the economic downturn. Little is said about the 
economic facts that existed when he took his oath of office; 
specifically, that the economy was in a tailspin, that Wall Street had 
lost at least $7 trillion of equities, and unemployment was rising 
dramatically.
  Indeed, President Bush inherited a situation that was not of his 
making and frankly not even of President Clinton's making, because we 
had witnessed the bursting of a stock market bubble and the dashing of 
hopes of tens of thousands of pensioners all over this country.
  It is a fact of political life that politicians are given too much 
credit and too much blame for the natural, immutable cycles of a free 
market economy. The latest casualty in this judgment on politicians is 
probably Governor Gray Davis of California. I remember during the 
heydays, the bubble days, California was held up as the miracle model 
and Governor Davis was hailed as a hero. He accepted the credit.
  I heard, with some pain, frankly, the other day when he acknowledged 
how much economic trouble they were in and that he had gotten too much 
credit for the good times and now was getting too much blame for the 
bad times. Guess what. Governor Davis was right. The truth of the 
matter is we in public life do not control a free market economy, and 
if we ever do, we will have a socialist economy which will ill serve 
the American people.
  Before I came to this Chamber, I ran a business. On a seasonal basis, 
we employed as many as 1,200 people. During the Reagan years, they were 
boom years; they were wonderful years. In trying to expand my business, 
I always remembered the factors that helped me make a decision whether 
to invest in a new piece of equipment or to acquire another plant. It 
had little to do with who the President of the United States was. It 
had little to do with the fact that I was proud that Ronald Reagan was 
my President.
  Two of the factors Government did have an impact upon, beyond 
regulation, were interest rates, which are controlled by the Federal 
Reserve, and taxes, which are controlled by the Congress and the 
President.
  In those days, taxes were coming down, interest rates were falling, 
and the American economy was booming. Then during the Clinton years, 
there was a business correction under President Bush. As President 
Clinton took his oath of office, the American economy again boomed with 
productivity and prosperity, and President Clinton was great to take 
credit for the conditions of our free market economy but wanted nothing 
to do with its collapse as he left the Presidency. Again, too much 
credit, too much blame, for President Clinton and President Bush.
  As I listen to those who aspire to the Presidency to replace our 
current President, I hear them speak of the Bush economy in the most 
derisive of terms, but I wonder how they are beginning to factor in all 
the good news that is beginning to come out about the American economy, 
as the immutable cycles of supply and demand, the falling of tax rates, 
the falling of interest rates, are beginning to show up in the lives of 
the American people. How will they deal with the fact that consumption 
has been rising and topped 12 percent on an annual rate last month, and 
that has the potential to translate into economic growth, GDP, of 6 
percent? I suspect it will probably top out somewhere around 4 percent, 
but that is a very healthy economy. How will they deal with the fact 
that jobless claims are falling, and quickly, in many parts of our 
country? In fact, jobless claims are now lower than they were in 
February.
  More good news: production in our Nation's factories has increased, 
not decreased. Home-building starts are now at record levels. Over 1.9 
million new homes on an annual basis are on the books now and being 
built as we speak. This is the second highest level of home building in 
17 years.
  I believe consumers understand that things are improving and there is 
reason to feel that once again morning is coming to America and good 
days are ahead. But we can yet do more. I think

[[Page 25389]]

we can do that in the FSC bill that has gone through our Finance 
Committee and is now in a conference committee. It contains a feature I 
helped get into the bill, as a most important provision, called 
repatriation. This is a provision that will bring at least $300 billion 
of new investment in the next year into the United States. What does it 
mean to companies in Oregon such as Nike, Intel, and Hewlett-Packard, 
which are our biggest employers? It means they can bring these foreign 
profits back for investment in American jobs.
  Some say it is not good tax policy. Some say it is not fair. I say, 
do we want the jobs or do we not? If one wants to understand what this 
means in very real human terms to this country, recently Dr. Allen 
Sinai completed a study on what repatriation would mean to this 
country. He said it would mean up to 650,000 additional jobs created in 
the first 2 years. He said $70 billion of the deficit would be 
eliminated. He said that increased GDP could be enhanced by 7 to 9 
percent by 2005. He also said business capital spending, primarily of 
equipment, could peak at $75 billion by 2005. We can do more and 
Government should do what it can. It cannot control the cycles of 
supply and demand, but we can keep downward pressure on interest rates. 
We can keep downward pressure on taxes. We can keep rules and 
regulations reasonable and we can allow the genius of the American 
people to be manifested again in a free market economy.
  Finally, I think it is very important to note that our friends on the 
other side who say the key to American prosperity is to invest in 
public things, in public investments, are right at the margins, but 
they are not right at the center. What makes America work is 
entrepreneurial spirit with the right environment to invest to produce 
quality products we can afford, and to provide a service that makes us 
happy.
  Ultimately, those who come with great jobs bills of public works--if 
that really could make an economy hum, then Japan would be leading the 
world and many European countries would be leading the world because 
they have fallen for this short-term, sugar-coated candy that says the 
government can do it, private industry does not need to do it, and it 
can be done through public works. If that were true, then the New Deal 
would have ended the Great Depression, but it did not. World War II 
did.
  If that were true, then Japan and Europe would be leading the 
economies of the world instead of waiting for the American free market 
economy to begin taking off again.
  In conclusion, I think the good news is the American economy is 
beginning to hum again. For that, I am very thankful.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time? The Senator from Wyoming.
  Mr. THOMAS. Madam President, I will take the remainder of our time to 
talk a little bit about jobs, an issue that has been highest on our 
agenda on this side of the aisle for a good long time, and continues to 
be. First, I have to react a little bit to some of the comments that 
were made earlier about moving forward. I am very frustrated that each 
bill brought to this floor is slowed down either by objection or by a 
week's discussion and debate of amendments. Of course, everyone is 
entitled to offer amendments. But when you have to stay with a bill 
that is fairly simple and be there for a week and a half and then 
complain about not getting our jobs done, that is sort of ironic.
  Obviously, we have at least four things that need to be done in the 
next several weeks. We have to continue the supplemental bill to pay 
for our Armed Forces in Iraq as well as to get Iraq in a position to 
allow us to leave and take care of themselves.
  We do have appropriations left. We have six that are not done yet. So 
we do have to worry about that and move forward.
  We have the opportunity to do something with health care, 
particularly pharmaceuticals and Medicare, and we are in a position to 
do that.
  We also have an opportunity to do more with energy than we have done 
for a very long time. I recall, having been on the Energy Committee 
both this year and last year, when we were in conference. We had a 
conference last year, you recall, and never succeeded in getting the 
bill finished.
  So we have some real challenges. Frankly, I have become surprised at 
the kind of reaction we get off the floor, that almost every issue is 
designed to be critical of the Bush administration. What we ought to be 
doing is doing our job, to do the things that need to be done and that 
are pending for us to do and that we can do and will do some great 
things for the country.
  I would like to talk a little about jobs. Of course they are most 
important to all of us. There are some good signs in the job market. 
The Labor Department reported on October 3 that employment rose by 
57,000 last month, the first increase since January. The unemployment 
rate held steady. So we seem to be having some signs of getting that 
job situation back where we would like it to be.
  We have had on our agenda a list of things that are designed to help 
create jobs and, as the Senator from Oregon indicated, the economy is 
what creates jobs--not the Government. But we can do things that help 
stimulate the economy which cause job growth.
  One of them that is most important, and that has already been talked 
about by my friend from Idaho, an issue that is very important to me, 
is energy security, the Energy bill. Energy security for this country 
means job security and the creation of jobs.
  The comprehensive Energy bill we are talking about here has been 
scored to have about 700,000 jobs that could be accentuated and could 
be encouraged by the passage of this bill. Many of the jobs will come 
from construction. Some have to do with the possibility of a pipeline 
in Alaska. Others have to do with domestic production.
  Of course, energy has a great deal to do with our whole business 
community, our whole business interest. Everyone relies on available 
and affordable energy. Certainly one of the things we have to continue 
to recall is we have become almost 60-percent dependent on foreign oil. 
We need to do something about that. We have seen our gas supply in 
great demand and the prices rise while at the same time we have 
resources of gas that can be made available. We need to encourage that 
development.
  We have an Energy bill that is quite balanced, it seems to me. We 
talk about research that will make coal more clean so we can use the 
coal, which is our largest fossil resource that we have available to us 
for electricity.
  We have renewables in there. We will continue to work on electric 
energy created by wind and make that more efficient. We have some 
things in there for conservation. We can make better use of our energy 
and certainly that ought to be important to us as well.
  In addition to that, and perhaps more important in the short term, is 
to increase domestic production. To do that, one of the opportunities 
is to make it economically possible for those who are developing it 
through some tax changes. Those seem to be held up now. We are hopeful 
we can move forward and get that job done. It is available for us to do 
immediately--this week, next week. We can get this done for the first 
time in a number of years.
  There are other items on the agenda that have to do with jobs. There 
is tort reform, asbestos litigation reform--which is available now to 
come to the floor. There are different views about that, of course. 
There is nothing wrong with that. But the fact is that would create new 
jobs by allowing companies to divert some of their dollars from 
litigation toward new investment, which creates jobs. The litigation 
defense costs are tied directly to offset expenditures relating to 
138,000 jobs that could be replaced if we can do something about those 
distortions in the economy.
  Class action reform is here. In fact, we are going to vote on the 
opportunity to proceed with it tomorrow because it has been stopped by 
the other

[[Page 25390]]

side of the aisle. Here again, class action litigation causes a good 
deal of confusion and uncertainty about the marketplace. Industries do 
not know whether their money is going to be available for expansion and 
investment or whether it is going to have to be saved for payments on 
those things.
  We have the workforce investment reauthorization. This will improve 
job training by focusing on core skills and encouraging effective 
cooperation among job training partners so people will be better 
prepared to take on the jobs that are available. Certainly what is 
happening in this economy is it is a more high-tech economy and more 
training is needed.
  We have the Foreign Competitiveness Act, which we are dealing with 
now in the Finance Committee, where the tax situation we have now has 
caused a WTO objection. But we can change that so it does fit into our 
foreign trade operation and at the same time continue to create more 
jobs and to have businesses do better.
  The Small Business Administration bill is there. That would help 
ensure that SBA programs will continue to provide products and services 
essential for small businesses. That is where most of our jobs are, 
particularly in a State such as mine, Wyoming. Almost all of our jobs 
are small businesses. So the SBA bill is certainly extremely important.
  The Homeland Investment Act is pending, too. That allows the Internal 
Revenue Code to change with the objective of encouraging reinvestment 
of foreign earnings in this country. You would be surprised at the 
amount of money that is involved, if we allowed companies that do some 
of their work overseas to take some of their profits home with a 
reasonable tax payment, and we would have more money for investment.
  So we have a lot of things to do. We have some great opportunities. 
Jobs certainly has to be the priority for all of us. The stock market 
is great. We love to see that grow up. But the fact is, jobs are the 
key to our success. We want to continue to improve there.
  Finally, let me say quickly that I certainly hope we can come out of 
the committee and finish our work on the supplemental to supply funding 
for our Armed Forces overseas and to do something in Iraq so we can 
move ahead.
  I had the occasion to be in Iraq and Afghanistan a week ago for a 
week. Certainly it was an interesting situation. There is a little 
different view there than what you hear from here. Certainly our troops 
have done an outstanding job, and continue to do an outstanding job not 
only on the war, not only on terrorism, but also helping to rebuild. 
We, obviously, have some continuing problems there with terrorism and 
that has to be handled, but we are moving toward having the Iraqis and 
their own police force moving into that.
  But my point is, I hope we can get over there and put Iraq more 
quickly in a position to take care of themselves so we can bring our 
troops home. In terms of overall expenditure, that of course would be 
our greatest saving.
  I yield the floor and yield back the remaining time we have in 
morning business.

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