[Congressional Record (Bound Edition), Volume 153 (2007), Part 23]
[Senate]
[Pages 31943-31945]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              THE ECONOMY

  Mr. KENNEDY. Mr. President, I rise to take a few moments to talk 
about the state of our economy. I do so because during the break, I had 
the opportunity to talk with a lot of people in my own State of 
Massachusetts. Our State is not greatly different from many other 
States, certainly in the northeastern and central part of the Nation, 
older industrial States. The conclusion of working families and the 
middle class is pretty consistent across the country, that the state of 
our economy has given working families a good deal of fear.
  Let me review quickly what our current situation is. The vast 
majority of Americans are anxious about the economy. This is from the 
latest poll in November of 2007: 78 percent say the economy is getting 
worse, the most negative outlook in the past 16 years. We have to ask 
ourselves: Is this a Democratic, Independent or Republican view? Let's 
look across the spectrum: 89 percent of Democrats feel that way, and 
these are representatives of working families; Independents are 78 
percent. Even among Republicans, 65 percent believe the economy is 
getting worse.
  This sense of anxiety about a growing economy has been there for some 
time. Look where it was in January of 2001. Fifty-six percent of 
Americans were concerned about the economy. Now look at November of 
2007. It has gone from 56 percent to 78 percent who are concerned about 
the economy.
  Let's look at how working families view the future for the next 
generation, their children. Working families feel insecure about their 
children's economic future. This is a current assessment of how working 
families view what is going to happen to their children: 23 percent 
believe their children will be better off than they are today; 30 
percent believe their children will have the same future as they have; 
and 42 percent believe their children will be worse off than today. 
This is a defining aspect of what our country is about. It is about the 
American dream. It is about hope and opportunity, not only for 
themselves but for their children and their children's children. When 
you lose that hope, you begin to lose working families' views about the 
American dream.
  This chart shows an explanation of why this has happened. We are 
growing further apart in terms of wages and productivity for middle-
income families. From 1947 to 1962, as we came out of World War II, as 
productivity increased, wages increased, and the economy went along 
together, all of the different quintiles of the American economy went 
along together. We all grew together. There was a sense of optimism and 
hope because we had a shared economy, a shared future. But look at what 
has happened in terms of real wages and productivity. Productivity has 
escalated 205 percent. Wages have effectively gone up about 5 percent 
over the last 7 years in terms of real dollars and the rest of that 
productivity has gone to the wealthiest individuals.
  One of the principle reasons is because wages have effectively 
remained stagnant. We have seen what has happened to the price of 
gasoline. It is up 66 percent. Health care is up 38 percent. Education 
is up 43 percent. Home ownership is up nearly 40 percent, and 
effectively wages are stagnant at 5 percent. These are the things that 
families are concerned about, how they are going to get to work. How 
they are going to be able to afford health care, to send their children 
to school? Are they going to have a home?
  This is what all of us have seen in many of the colder regions of the 
country. As the temperature drops, home heating oil prices have gone 
through the roof: $1.83 a gallon in 2001; in 2007, $3.29. It has gone 
up 33 percent in real terms since last year. So homes have gotten more 
expensive. Education is more expensive. Fuel is more expensive. Health 
care is more expensive. Heating oil is more expensive. This has all 
contributed to the growth of insecurity.
  The price of food has risen faster than the rate of inflation. 
Whether it is a pound of beef or whether it is eggs, prices are rising 
up to 50 percent faster than the rate of inflation. Even milk is higher 
than the rate of inflation.
  All of this has been happening while working families have been 
working longer and harder than those in any other industrial nation of 
the world.
  Here, as shown on this chart, we have nearly 40 million Americans--28 
percent of the American workforce--who work more than 40 hours a week. 
Also, 1 in 10 workers works more than 50 hours a week. So almost 30 
percent work more than 40 hours a week. Mr. President, 7.9 million 
Americans are working two or more jobs. American working hours are the 
second highest of any of the developed countries.
  This chart is a good indicator. Americans' work has increased more 
than any other industrialized country of the world. Here it is: 20 
percent from 1970 to 2002. Here, as shown on this chart, is the United 
States. Workers are working longer. They are working harder. Many of 
them are getting two jobs. And the essential elements that are 
necessary for their livelihood have far exceeded their wages and, 
therefore, they find increasing apprehension about their own future and 
about the future of their country.
  This chart is an indicator about where we are in terms of savings. 
Credit card debt has exploded, bringing cash available for an average 
family down to $1,600. The credit card debt has gone absolutely up 
through the roof. This chart shows that Americans now owe $900 billion 
in credit card debt. This is the escalation: People are borrowing

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this money, relying more and more on the credit card; and the fees that 
are being charged are extraordinary. But Americans will have to pay 
them because they cannot see any other way.
  This chart is an indicator of where the savings have been going over 
the period of the last 40 years. The red line indicates that the 
savings have gone right down. We are talking about working families 
with virtually no savings. There is an extraordinary escalation in 
terms of the cost, and all of this is happening at the same time.
  This chart shows that millions of American families are facing losing 
their homes. Foreclosures are rising dramatically--177 percent from 
2005. Pick up any newspaper in the country today and you will see that 
kind of pressure that is on working families. With all the apprehension 
they have, can they afford the mortgage, particularly at this time of 
the year, Christmastime? Can they afford the mortgage? And can they 
afford to try to celebrate Christmas with their children?
  These are the mortgage woes that are creating a ``subprime'' 
Christmas for consumers in stores. This is the Harriman family who 
normally spends about $500 on holiday gifts. This season they have a 
wrenching choice: celebrate Christmas or keep their home out of 
foreclosure. Many families have gone into that situation.
  There is an increasing number of bankruptcies. This chart shows the 
escalation now in terms of the number of bankruptcies that are taking 
place among working families in this country--escalating, escalating, 
escalating. As shown on this chart, this is by quarters. This is 2007: 
The first quarter, the second quarter, the third quarter--and it is 
continuing to escalate and grow and grow. Houses are being lost. 
Bankruptcies are taking place.
  This is one of the very distressing charts. This couple and child 
represent a middle-class family, middle-income family from the last 
generation, which would be 40 years ago. This is the current situation 
for the last generation's children.
  You will see that 19 percent rise to the top of the economic ladder; 
17 percent fall to the bottom. Look what the total is: 36 percent of 
the children of middle-income families rose somewhat, and 41 percent of 
the children fell--fell slightly or fell to the bottom. These are the 
children of middle-income families, the backbone of this country, our 
society, and this is what has happened to them. These are the latest 
figures, and families know that.
  It is bad enough for the average family, but it has been particularly 
damaging in terms of a number of the minority groups. In this case, 
African Americans born to middle-class parents have fallen out of the 
middle class. In the last 20 years, in middle-income families, 69 
percent of the children--effectively 70 percent--have fallen into lower 
economic standing. This has probably been true in terms of other 
minority groups as well.
  We are growing farther and farther apart, increasing inequality, 
increasing uncertainty, at a time when the safety nets are effectively 
disappearing--disappearing in terms of pensions, disappearing in terms 
of health care costs, disappearing in terms of unemployment 
compensation. All of those safety nets have been put in tatters at a 
time when working families and their children are in the greatest need.
  This chart shows the number of uninsured Americans. We are familiar 
with the figures. They are used daily. Now the number is close to 47 
million. This is even in spite of the fact that the CHIP program was 
implemented during this period of time and has actually provided health 
care for up to 7 million children.
  This chart is interesting because we have too many working Americans 
lacking insurance. Look at this: More than 80 million adults and 
children--1 out of every 3 nonelderly individuals--have spent some part 
of the last 2 years without health insurance. Without insurance: 80 
million--80 million in a country of 300 million people. So 80 million 
people have spent some time over the last 2 years without health 
insurance. And 85 percent of them were working adults. These are 
working men and women. These are men and women who are working, in many 
instances, 2 jobs--working longer and harder than at any other time in 
the history of our country, and they are still facing this situation.
  This chart shows that half of American workers do not have any form 
of retirement savings at work. They effectively have no pension 
savings. That is half of all the workers in this country. It is a 
rather important shift and change in recent times. Now it is going in 
the absolutely wrong direction. Mr. President, 4 million fewer 
Americans have pensions than 7 years ago. In 2000, 46 million workers 
had one. Now it is 42 million workers, and these numbers are going 
right on down. They are not going in the right direction. They are 
going in the wrong direction.
  This chart is another way of saying that only one in five workers now 
has a defined benefit pension which will give the workers some 
assurance there will be benefits there. Others have the 401(k)s that 
may be going up or may be going down, and we have seen a period where 
they were going down, and they have lost their security in terms of 
their future. That has been happening over the period of the last 16 
years, where increasing numbers have lost their security.
  American workers lack access to the needed paid sick days. What is 
happening in the middle class is there are increasing numbers of 
children who need focus and attention because two members of the family 
are working and their child is sick. Also, because parents are living 
longer, working families have more responsibilities to provide care for 
needy members of their family. But only 48 percent have paid sick days, 
and 70 percent do not have paid days to care for sick children. So it 
is a very small number of parents who have that. They are caught in the 
situation where they have a sick child, and they let the sick child go 
to school, where the child gets sicker and, chances are, contaminates 
other children as well.
  Unemployment has risen under President Bush and his failed economic 
policies. Unemployment has increased by 1.2 million people from January 
2001 to October 2007. But long-term unemployment has gone up 59 
percent. This is long-term employment. These are people who have lost 
their jobs and are unable to get a job. They effectively were 
participants in the job market. This figure is unusually high and it's 
been high for an unusually long period of time.
  There are a final few points I want to mention. The majority of the 
unemployed workers do not receive benefits. We used to think if you 
were unemployed, you were going to get unemployment insurance. Not 
anymore. Sixty-four percent of unemployed workers receive nothing at 
all from unemployment insurance. For those who do now collect benefits, 
they are often inadequate. Average unemployment insurance checks are 
down to 28 percent of income. This is an antiquated system. Now workers 
who actually pay into it are ineligible to get it for a variety of 
different kinds of technical reasons. We are trying to work with the 
Finance Committee, with Senator Baucus and others to address this 
issue. These are workers who have paid in or are otherwise eligible for 
unemployment compensation and are unable to collect it.
  Effectively, as shown, this is the inadequacy in terms of childcare. 
Only 14 percent of eligible children have access to Government-assisted 
childcare.
  These charts give you some idea why the working families of America 
have such apprehension in terms of the future and in terms of their own 
lives. We need the programs to be able to deal with this situation. We 
have a number of recommendations, and I will mention them very quickly 
this afternoon and will put in additional kinds of information.
  First, we need to safeguard working families from the turbulence of 
the modern economy by providing stronger and better support for 
families in crisis. Our country is going through profound economic 
shifts, and too many workers are losing their jobs in the wake of these 
changes.
  I have introduced bipartisan legislation, the Unemployment Insurance

[[Page 31945]]

Modernization Act, to make sure those who have worked hard and paid 
into the system get the benefits they deserve. I hope we will see 
progress on the bill soon so that much more that needs to be done will 
be done to help Americans who are struggling to find a job.
  We also need an aggressive agenda to help families facing a health 
care crisis. We must make more progress toward a universal, 
comprehensive program that is going to be there and be available and 
accessible to all Americans.
  In the meantime, we can follow the examples of my own State, 
Massachusetts, which has taken the lead in providing our residents 
access to quality health care. It is absolutely essential, as these 
charts pointed out, that we address this problem.
  Strengthening the safety net alone is not enough. We need to redouble 
our efforts to restore economic opportunity for families. Americans are 
working harder than ever, and they need the additional kinds of 
training. In my State now we have 145,000 unemployed. We have 75,000 
job openings. They are good jobs. Yet, we have seen a continuing 
reduction in terms of training programs. Those people could get the 
jobs and be taxpayers and be committed and productive members of 
society. But we have seen over the period of the recent years, 
including with this last budget request, a continued reduction in terms 
of training programs by this administration.
  We know workers have to have a continuing, ongoing upgrading of their 
skills in order to be able to deal with these jobs. I think we need 
labor law reforms, such as the Employee Free Choice Act, to protect the 
right to organize so employees can stand up and fight for what is fair.
  I think we need to address again the earned income tax credit to help 
those at the bottom of the economic ladder who have worked hard and 
played by the rules. We have to continue, I think, the progress we have 
made in the increase in the minimum wage so we do not fall back in 
terms of providing working families with a decent income.
  The late Barbara Jordan once said:

       What the [American] people want is very simple. They want 
     an America as good as its promise.

  The promise of America is that it is truly a land of opportunity, 
where every working family can share in the Nation's prosperity, where 
we all rise together, and we can be confident that our children have a 
bright future. For decades we enjoyed that vision of shared prosperity. 
I am confident we can make that promise a reality for American families 
again. We owe it to all the workers who have seen their bills go up, 
while their paychecks go down. We owe it to all the parents who cannot 
sleep at night because they are worried about their children's future. 
We owe it to all the families who are struggling and need a reason to 
celebrate this holiday season. We owe the American people our best 
efforts, and I look forward to working with my colleagues on both sides 
of the aisle in the weeks and months ahead to put working families back 
on track.
  Mr. President, I yield the floor.

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