[Congressional Record (Bound Edition), Volume 155 (2009), Part 6]
[House]
[Pages 7845-7852]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  THE ECONOMY AND GOVERNMENT SPENDING

  The SPEAKER pro tempore (Mr. Griffith). Under the Speaker's announced 
policy of January 6, 2009, the gentleman from Missouri (Mr. Akin) is 
recognized for 60 minutes as the designee of the minority leader.
  Mr. AKIN. Mr. Speaker, we have a number of interesting topics that we 
are going to be talking about tonight, and even a little bit of a 
challenge question for people who are feeling imaginative and 
innovative, and it is a strategic question about some votes that are 
coming up tomorrow on the floor. It should be very interesting.
  Joining us first off this evening is my good friend, Congressman 
Pitts, who hails from Pennsylvania and has come up with quite a barrage 
of different colorful charts here. I don't know, it looks like some 
part of a critical measurement of somebody's life expectancy or what it 
is, so I am going to yield time to Congressman Pitts, who has been a 
Congressman for a long time, highly respected, from Pennsylvania. I 
yield the gentleman time, and I would like you to tell us a little bit 
about what you graphed here, because they are quite interesting.
  Mr. PITTS. Mr. Speaker, I thank the gentleman for yielding. There is 
an old saying that a picture is worth a thousand words. And I think 
sometimes,

[[Page 7846]]

Mr. Speaker, pictures help explain some otherwise complicated 
situations, so I have assembled some data about the economy and 
government spending, and put them on charts to help explain some of the 
facts.
  I think the overall emphasis is that there are economic consequences 
to what we do and what we say here in Congress. There are economic 
consequences to our taxation and spending, our budget policies. And I 
would just like to first explain some of the colors on the chart and go 
through them.
  On the chart you see red and blue lines. The colors here indicate 
which party is in control of Congress. So where you have red, that is 
the control of Congress in both the House and Senate is Republican. So 
you have here and here in these years Republican control. Where you 
have blue, that is both chambers being controlled by the Democrats. 
Where you have the slanted marks, you have a divided Congress. So here, 
the House is Democrat and the Senate is Republican; and with the 
smaller lines, you have the House Republican and the Senate Democrat. 
And we have a range of years here from 1977 to 2009.
  At the bottom, you can see President Carter here from 1977 to 1981, 
and then Reagan, and these white dash marks show the range of the terms 
of the President.
  Mr. AKIN. Reclaiming my time. I think what you are saying is you are 
really putting a whole lot of information in one picture. Aren't you?
  Mr. PITTS. That is correct.
  Mr. AKIN. The white dash lines are transitions in terms of the 
Presidencies.
  Mr. PITTS. That is correct.
  Mr. AKIN. The blue color represents the Democrat color; the red is 
the Republican color; the hash marks is a mixed bag, you have got 
Republicans in one body and Democrats in the other. So now you have got 
basically a whole timeline going, what is it, close to 20 years or so?
  Mr. PITTS. That is correct.
  Mr. AKIN. Go ahead. Proceed.
  Mr. PITTS. Thank you. If you look at how the market, for instance, 
reacts, here is the Dow Jones in yellow over this period of time. It is 
going along real nicely here until it hits the red section, and then 
you see it move sharply up. The Dow goes sharply up. You have a divided 
legislature. And, to be fair, you had the dot-com collapse and 9/11, as 
well as the switch of Jeffords to make the divided Congress. It goes 
down. And then you hit the red, it goes sharply up. As long as 
President Bush is there to veto any of the proposed tax changes that 
the Democrats in this Congress proposed, it goes up.
  Mr. AKIN. Reclaiming my time, gentleman, it sounds like to me this is 
stock market advice that you are offering today. What you are saying is 
if you see the Republicans in charge of the House and the Senate, then 
go buy some stocks. Is that what you are trying to tell us?
  Mr. PITTS. No. I am saying that markets basically react to rhetoric; 
and that on-again, off-again tax cuts, that rhetoric about tax 
increases affect the market dramatically in a negative way, and you can 
see this drop here.
  This second chart is unemployment, which is sort of a mirror image in 
the strong periods and in the weak periods with the recessions. The 
next charts are the budget deficit and job growth. So if you look at 
these yellow bars here, these are the budget deficits. Notice under 
President Obama this deficit here, $1.752 billion, this bar. That is 
more than all of the 8 of the previous administration, under Bush, 
combined.
  Mr. AKIN. Reclaiming my time, that little yellow line is so close to 
the edge that the first time I saw that, I just about missed what you 
are saying. This looks like some sort of science fiction thing. Let's 
go through it.
  If you add up the yellow bars between those two sets of dotted lines, 
which represents the 8 years of the Bush years.
  Mr. PITTS. That is correct.
  Mr. AKIN. And that President Bush was being beat up because the 
Republicans were spending too much money. Now, was that true?
  Mr. PITTS. That is true. I remember when they were attacking him for 
$250 billion deficits. Now, we have a $1.7 trillion.
  Mr. AKIN. I voted against a lot of that spending. But now reclaiming, 
and taking a look at that chart, what you are saying is if you add up 
all of those Bush deficits together, how does that compare to that huge 
jump that you see this year?
  Mr. PITTS. The deficit of $1.752 trillion is more than all of the 
previous 8 years combined.
  Mr. AKIN. More than all 8 years of Bush. You add all of the 8 years, 
and you are saying in this year--is this 2009?
  Mr. PITTS. That is correct.
  Mr. AKIN. You are saying that, in 2009, we have more deficit we 
racked up than all 8 years of Bush?
  Mr. PITTS. That is correct. I could have really scared you and showed 
you the proposed deficits in the future, but I only have this year's 
proposed deficits.
  Mr. AKIN. My heart might not handle that.
  I notice we have been joined here by Congressman Rooney from Florida, 
who is bringing a little bit of southern perspective on these charts.
  I yield to Congressman Rooney.
  Mr. ROONEY. Thank you, sir. I appreciate the chart, first and 
foremost, because what I wanted to jump in and tell you is that we have 
been joined by some children in the chamber. This past weekend, I had 
the opportunity to go camping with my kids in Central Florida, and it 
all sort of dawned on me and hit me at once, as we are now referred to 
as the party of ``no.''
  When you see a chart like this and you see what these children are 
about to face and what my three young sons, who are 7, 5, and 2, are 
about to face, why we are the party of ``no.'' And we heard recently 
from the other side as they were here and how outraged they were at AIG 
and how outraged they are at some of the things that are going on, this 
is why we vote ``no.'' This is exactly the reason why. We have to stand 
by our children and not saddle them and put on their backs what you are 
displaying on that chart there, sir, so that we can keep our financial 
house in order and allow it to translate to them an America that is 
better than we inherited.
  We are on the cusp, as one of my friends in Florida likes to say, of 
being the first generation of Americans that leaves to their children 
an America that is worse off than what we received. That is all on us.
  So we can sit here all day and talk about how outraged we are at AIG 
and what has happened with these bonuses being paid out that was agreed 
to and voted on by this Congress, even though a lot of us on the 
Republican side voted ``no,'' to be called the party of ``no'' and to 
see this, and now to hear the Democrats say they are outraged by what 
has happened.
  Mr. AKIN. What just occurred today made it pretty obvious why we 
needed to be saying ``no'' to that big porkulus bill; because it had, 
just as we knew it would, all these little things hidden in it. We are 
going to be talking about that. We are going to be talking about some 
of the things that were hidden in it that were just announced on ABC 
News just recently.
  We have also been joined by a doctor, we have increasingly a number 
of doctors in this Congress, the good Dr. Cassidy from Louisiana.
  I yield time to Dr. Cassidy.
  Mr. CASSIDY. Thank you. It is interesting, as you are talking, two 
things occurred to me. You mentioned how taxes have the ability to 
create uncertainty.
  Now, if we just take this, not from the nationwide but bring it down 
to a family in Louisiana. This new budget is going to tax oil and gas 
exploration. Well, it turns out 90 percent of oil and gas is done not 
by ExxonMobil but by small wildcatters, if you will, and these folks 
employ about 320,000 people in my State in petrochemical. Now, these 
are great jobs. These jobs give benefits. They allow people to pay 
their mortgage. They are not service level in that sense, but they are 
jobs of the type that you can raise a family.
  So earlier we heard our Democratic colleagues speaking about our need 
for

[[Page 7847]]

energy independence, and I am struck. I am new here, so I don't quite 
understand it.
  We want energy independence. We want to create good jobs for working 
folks with good benefits, help the uninsured, but at the same time we 
are penalizing a domestic energy industry, which cannot move because it 
is domestic, which is helping our energy independence and which is 
creating these jobs.

                              {time}  1830

  Mr. PITTS. Would the gentleman yield?
  Mr. CASSIDY. Yes, sir.
  Mr. PITTS. I serve on the Energy and Commerce Committee, and we are 
having hearings every week. We had one today on the proposed new 
proposals, cap-and-trade they call it, of the Obama administration. Now 
in a time of economic uncertainty, families and small businesses have 
to conserve. They have to be more efficient. They have to save. They 
have to be a lot more frugal. This is not the time to massively expand 
the Federal Government.
  We should be doing what we are supposed to do in a more frugal way, a 
more efficient way. And yet the new administration is proposing vast 
new proposals in the area of government-owned health care, in the area 
of cap-and-trade, which is a tax on all energy use in the United 
States.
  Mr. AKIN. Reclaiming the time here. I recall standing not very far 
from where I'm standing right here on the floor of this House and 
hearing the President make a promise. And I felt good when he made the 
promise. He said, ``I'm not going to tax anybody who is making less 
than $250,000.'' And I sort of slumped back in my chair and said, 
``well, at least he missed me.'' Now we are talking about cap-and-
trade. And what he is going to do is he is going to increase the energy 
costs on every household across our country. It doesn't make any 
difference how much money you're making. If you're using electricity or 
burning fuel, you're going to get zapped. And the average is $3,000 per 
household. When you see that big yellow line, that just isn't a big old 
line on a graph. We are talking about families in America in all of our 
districts getting saddled. And this is just one proposal. This is just 
``cap-and-trade.''
  Mr. PITTS. Will the gentleman permit me to speak here? The cap-and-
trade proposal really has eight taxes on energy. And the President is 
proposing to raise $646 billion with this new cap-and-trade regime. So 
this big line here, the deficit here, which makes all the other 
deficits look small in comparison, is reflecting these massive new 
government programs. In the stimulus bill we passed--not we--but the 
Congress passed, the creation of 31 new Federal programs and an 
expansion of 73 existing programs. This is massive government spending. 
That is what is reflected in this.
  Could I just point one other thing out, Mr. Chairman?
  Mr. AKIN. Certainly.
  Mr. PITTS. There is a good lesson in here. Do you see these 4 years 
right here when the Republicans controlled the House and Senate? 
Speaker Gingrich was here. I served on the Budget Committee with John 
Kasich of Ohio. And because the Republicans in Congress worked with 
President Clinton--Clinton deserves some credit, and we deserve some 
credit--we balanced the budget 4 years in a row. We had four 
consecutive balanced budgets and paid down the public debt 4 years in a 
row.
  Real bipartisanship works. This phony bipartisanship of wanting us to 
come in at the last minute and vote for something without having any 
bipartisanship in creating the bill, in crafting the bill at first, 
that will not work. Real bipartisanship is good for the country, not 
calling us in and trying to buy off three votes at the end. I yield 
back.
  Mr. AKIN. The gentleman from Florida, Congressman Rooney.
  Mr. ROONEY. Sir, I appreciate your saying that, because as I stand 
here with my colleague, Dr. Cassidy, as a fellow freshman, I do believe 
that when we came up here after campaigning recently, what the American 
public, or at least my constituents, were expecting, was the 
bipartisanship that you are talking about. And I have to tell you, it 
is the biggest disappointment from taking the oath of office and 
starting as a congressman, that that is just not reality. I don't know 
if that is how it has worked. Obviously, it has worked in the past. But 
that is not what we are getting now in this Congress. And it is an 
extremely disappointing, eye-opening phenomenon that unfortunately we 
have to endure.
  I just want to expand a little bit on what the gentleman was talking 
about with regard to the $250,000 on top of what you are talking about 
with cap-and-trade, or cap-and-tax, as some people like to call it, 
with the people that are going to have to pay the $3,000 per household 
to afford the energy costs that cap-and-trade will bring. But the 
$250,000 cannot be dismissed without first realizing you're talking 
about the small business owners. The people who in my district employ 
five, 10, 15 people, they have told me that if they have to incur more 
taxes, because they are doing their taxes right now, if they have to 
incur more taxes, they are going to have to lay people off. So even if 
you don't make $250,000, you are going to be affected by this tax 
increase because you might be one of those people that the people 
making $250,000 lays off.
  So I think it is important that the spending, the taxing, and now 
obviously the borrowing that we are having to incur is just the wrong 
recipe, as I said before, for the future of our country.
  Mr. CASSIDY. Will the gentleman yield? It is a little bit ironic 
because I actually think our hopes are bipartisan. Our hopes are that 
we create jobs for the American people. Let's give it to our Democratic 
colleagues. They felt like spending this $1 trillion dollars is 
actually going to stimulate jobs.
  Now, as I listened to you, Mr. Pitts, speak about your committee, 
John Marshall's quote occurs to me, ``the power to tax is the power to 
destroy.'' I think our function here is actually to connect the fact 
that we share that hope for more jobs. But our fear is this tax, which 
is being justified by this deficit spending, will destroy. It will 
destroy these kind of jobs that we have in Louisiana for folks who may 
not go to college, but nonetheless are earning $70,000 to $80,000 a 
year and sending their kids to good schools with good benefits. And we 
are going to destroy it in the name of creating new jobs. When I was 
running for office, Congressman Rooney, that was backward logic: Let's 
destroy in order to save.
  Mr. ROONEY. If the gentleman will yield. And the question that you 
have to ask yourself, say that there are jobs created, and certainly 
there may be short-term jobs created. But what happens when the money 
runs out? You either have to pass another stimulus bill to keep those 
jobs or the small businesses are going to have to absorb those jobs. 
But if they have to incur increased taxes, they are not going to be 
able to do so. So whatever jobs are created through the current 
stimulus are a flash in the pan. And we are seeing there are a lot of 
things in that stimulus that we don't like so much, like bonuses for 
AIG. That is why we voted ``no.'' And we are criticized for doing that. 
But it was the right thing to do. I think that in the end, with what 
you're saying, Dr. Cassidy, is that there may be a short flash in the 
pan for jobs, but it is not the long-term jobs that this country needs.
  Mr. CASSIDY. The thought also occurs to me that obviously the jobs 
that are created that do have long-term benefit are created by those 
small businesses. And so the thought occurs to me, someone said, a 
commentator of some sort, it is good that the stimulus package is going 
to have people hire two more, say, police officers. That is good. It 
helps safety on the street. But two more police officers does not 
create 10 more jobs. On the other hand, if we can enable that small 
business, that small business will create 10 more jobs. So, again, it 
just keeps echoing in my mind, ``the power to tax is the power to 
destroy.''
  Mr. AKIN. Reclaiming my time. We have shifted the topic here just a 
little

[[Page 7848]]

bit. But I think it is very important. And you're making excellent 
points.
  What I'm hearing is we are talking about taxes. Let's just talk a 
little bit about an average guy that has a small business, because 70 
or so, depending on how big you call a small business, 70 or 80 percent 
of the jobs in America are in small businesses. So let's talk about the 
average guy in a small business. First of all, most of them are making 
or have a $250,000 income. So starting right off the bat, we are going 
to tax these guys, because they are the rich guys.
  Mr. CASSIDY. And gals.
  Mr. AKIN. They are the ones making over $250,000. So first off, we 
are going to tax the very source of 70 percent or 80 percent of the 
jobs in America. Then we are going to whack them with a tax on energy, 
first in their own home, but then in their businesses. Depending on if 
it is a small job, it may or may not be an energy dependent kind of 
business. So we are going to hit them again. Then we are going to hit 
them again by allowing the dividends and capital gains tax cut, which 
very much helps small businesses, and the death tax, all that is going 
to be allowed to expire. So now we are going to whack them the third 
time.
  After you get done beating them and beating them and beating them, 
then what we are going to do is spend money like mad on government 
programs, which the gentleman from Pennsylvania's chart is showing is 
unprecedented, we are in uncharted waters, so we are going to vacuum 
all the liquidity out of the economy so it makes it harder for the 
small businessman to get a loan and make an investment.
  Mr. PITTS. When we talk about $250,000 adjusted gross income, you're 
talking about a lot of small businesses who may be what you would call 
``asset rich but cash poor.'' They may have assets in building, lands 
and equipment. But that is where they put their profit. That is where 
they put a lot of their money. They are just not walking off with 
$250,000. They are small businesses that are investing in their 
businesses and creating jobs. So, we should keep in mind that 
government cannot create wealth. It is the American people. It is the 
entrepreneur. It is the small businesses that have to do that.
  However, government can hinder economic growth. With flawed policies, 
flawed tax-and-spend policies, borrowing, spending and taxing too much, 
we can crowd out the private sector. So that is important to remember 
as we look at the impact of these proposed new taxes. But that kind of 
rhetoric, on-again off-again tax cuts, tax increases they talk about, 
creates uncertainty in the market. So you will see people not 
investing, not risking their capital, and holding back in uncertain 
times.
  Mr. AKIN. Basically there are a bunch of people that are old geezers 
like I am. I'm a baby boomer. And you have saved money for years and 
years and years, and all of a sudden half of your money is gone because 
of the entire economic crisis which is a result of these kinds of 
socialistic policies which say that we are going to give loans to a 
whole lot of people that couldn't afford to pay, and we created this 
entire loan crisis. The loan crisis then spreads to the rest of the 
economy. So now you have people who are not very eager to be putting 
money into small businesses because they just lost their life savings 
on the stock market. So what they are going to be spending money on is 
gold bricks to stick under their pillow or other kinds of things. But 
they are not going to want to take those risks.
  We have been joined by my good friend from Ohio, Congressman Latta. 
Welcome to our discussion.
  I yield time.
  Mr. LATTA. I thank very much the gentleman for yielding. And I 
appreciate your having this very important discussion this evening. I 
have been sitting here listening to the other gentlemen this evening. I 
have been having what we call ``courthouse conferences'' in my 
district. What I have been doing is I have been going around the 
district. We go to two counties a day when we are not in session. We 
are there from about 8 o'clock in the morning to about 12:30 in one 
county, and then 1:30 to 6 in another county, and I meet with 
constituents almost every 10 minutes.
  What you have been talking about is on the minds not only of your 
constituents, and your constituents in Pennsylvania, but constituents 
across this country. And I will tell you, the question on their minds 
is about jobs. And it is about saving that wealth that they tried to 
accumulate, as you said, in their 401(k)s and their IRAs. They are 
worried about the Federal spending that is going on out there.
  You're absolutely right. The small-business owners are the ones that 
are creating the jobs in our area right now. A lot of people think it 
is the big corporations. No. It is not. It is those smaller companies.
  I sit across the table from these individuals. They look you in the 
face and they say, ``do you know what? I'm not sure how I am going to 
keep my doors open. We are having a liquidity problem. We are having a 
problem where we are losing our orders.'' But there is one thing that 
they all say. They all say the same thing: ``I feel a responsibility to 
the people I hire. How am I going to look those people in the face in a 
few months? I have 20 employees or 30 employees. And I have to start 
laying these people off. These people not only work for me, but they 
are part of my family now. They live down the street from me.''
  You're absolutely right. We are going down that road of ruin. It was 
not that long ago, back in the Carter administration, when we saw 
interest rates in this country go up to 21 percent. And what did that 
do? As you said, Federal Government does not create any wealth. We 
consume wealth. It is that small entrepreneur out there that creates 
the wealth for this great country of ours. So when we watch what 
happened back in the Carter administration, it is not that long ago 
that you couldn't go down to the local bank and get a mortgage. You 
couldn't get a loan. I started practicing law back in those days. We 
had to do what they call ``laying contracts,'' where the seller 
actually had to do the financing for the buyer because there was no 
money.
  I will tell you, the last thing we want to see in this country is 
interest rates going back to 21 percent. I remember, though, you could 
get a money market at that time, you could get a 14 percent return on 
your money. But if you are paying 21 percent, you're in the hole.
  So not only the folks back home in northwest and north central Ohio 
are scared, but people across this country. They tell us, ``here we are 
in our businesses cutting back. We are trying to scale back in every 
possible way that we possibly can. But what's the Federal Government 
doing?''

                              {time}  1845

  They just see us with the $700 billion bailout last fall for the 
financial institutions. And then they find out about AIG and the big 
pay outs. And they ask how about the stimulus package, how is that 
going to help me? How is the $75 billion on the mortgage bailout going 
to help me? What is going to be in it for me with the $410 billion 
omnibus. And as the gentleman talked about, we might be talking about 
another stimulus package. Who is going to pay for it? You are 
absolutely right, the generations to come are going to be paying for 
it.
  Mr. AKIN. I yield to the gentleman from Pennsylvania (Mr. Pitts).
  Mr. PITTS. This fourth chart shows the job situation. Above the line 
is job growth; and below the line is job loss by month. You can see 
when Reagan or Bush inherited a recession, when they passed these tax 
cuts, they stimulated tremendous job growth.
  For instance, in 1981, the capital gains tax was reduced from 28 to 
21 percent, and the revenue rose by 325 percent in 6 years.
  In 2003, you remember that under President Bush, when we reduced the 
capital gains, revenue rose 159 percent in 5 years. So this tax policy 
stimulates the formation of capital and directly affects job growth or 
job loss. Our tax policies have real economic consequences.
  Finally, the last chart. The President talked about gyrations in the 
stock market. So I took this last year from February 2008 to March 
2009, and here

[[Page 7849]]

is where the President Obama was inaugurated. I put up several things 
we considered in the Congress. The rebate checks, the housing bailout 
of $300 billion, the Fannie Mae and Freddie Mac bailout of $200 
billion. You remember the $700 billion bailout we passed, look at how 
the market dropped after that. Here is election day. Here is the auto 
bailout. Here is the stimulus bill, a $787 billion stimulus bill, look 
at the market drop. The $410 billion omnibus bill, look at the market 
drop; and now the proposed $3.6 trillion budget. What we do here has 
direct economic consequences on the market and on job formation.
  Mr. AKIN. Reclaiming my time, there are two general theories going 
way back in our past in America about what do we do when we start into 
a recession. One of the theories was started back in FDR's day back in 
the 1930s. We started into a recession, and there was a guy, Henry 
Morgenthau, and he was the Secretary of Treasury under FDR. He had the 
idea that we will spend a whole lot of government money, which will 
stimulate demand and get the economy going. People today still talk 
about stimulating demand by a whole lot of government spending. That 
guy's name was Henry Morgenthau. So how well did it work? He was joined 
in that theory by a little fellow by the name of Lord Keynes; a strange 
fellow. Because of his name, we called it Keynesian economics. And so 
at the end of 8 years of a tremendous level of government spending, 
Henry Morgenthau meets in the U.S. Congress in the Ways and Means 
Committee, and there is a quotation I have which says, ``We tried 
spending. We spent and spent, and it doesn't work.'' This is a guy 
whose theory it was you have to spend a whole lot of money. He said, 
``It didn't work, and unemployment is as bad as it was 8 years ago. And 
what is more, we are tremendously in debt.'' The Japanese tried it in 
the 1970s, and it didn't work for them.
  So what is the other theory than this Keynesian idea, the theory you 
are talking about, sometimes called supply side. JFK, who is obviously 
a Democrat, did a significant tax cut, and the economy improved. Ronald 
Reagan, another almost 20 years beyond him, did the same thing. You get 
this big kick, and then what you are showing there is President Bush. 
So this has been done a number of times.
  The one thing I regret, and you could have assumed from your chart, 
was that every tax cut is going to produce this improvement to the 
economy. I think the facts of the matter are it is not every tax cut, 
but certain specific tax cuts, particularly targeted, as the gentlemen 
that were guests before were talking about, toward what is going to 
affect that small business. So the tax cuts that really work are things 
like dividends, capital gains tax, death tax, and things along those 
lines because those allow the small businessman to have the liquidity 
to invest in his own company, and that is what really works.
  So it is not like Republicans just say no. It is just what we are 
saying no to is an absolute runaway train of government spending.
  We have been joined by the gentleman from Louisiana (Mr. Scalise).
  Mr. SCALISE. I want to thank my friend from Missouri. I think what 
you have been showing really is something that people around the 
country have been seeing for the last 2 months. They have realized what 
this change really means in terms of policy because ultimately what the 
markets are reacting to, what people are reacting to when they are at 
the water coolers is not just the rhetoric because the rhetoric during 
the campaign sounded really good. It was hard to disagree with people 
saying we need to be fiscally responsible.
  But when somebody says we need to be fiscally responsible, which I 
agree with, and then they present a budget which is $1.7 trillion out 
of balance, the largest deficit in our country's history, not just 
spending at record levels, dangerously record levels, but also adding 
$1.4 billion in new taxes, I think that is at the point where people 
said, Wait a minute, this wasn't the change that I envisioned. This 
wasn't what I was promised.
  The American people were told that 95 percent of the people in this 
country won't pay a dime in new taxes. And then they see this energy 
tax, this cap-and-tax proposal by the President, which literally would 
increase the taxes that people pay on their electricity bills. Anybody 
and everybody in this country who has an electricity bill will see at 
least a $1,300 a year, and the newest reports that are just coming out 
as they are factoring more of these changes, this budget that just got 
filed, the revised estimates are showing over $3,000 per family in 
America in new energy taxes.
  When people see this, they are saying, Wait a minute, that's not what 
you told me. That wasn't the change I was envisioning when you told me 
only the top 5 percent, people making over $250,000 would pay more. Not 
that it is a good thing to play class warfare, and I think that is the 
danger of class warfare that we are seeing. And your charts reflect 
what is happening because the markets continue to drop each time more 
of these proposals come out.
  We have been having hearings now in committee for the last 3 weeks on 
this energy tax proposal, and not only will every American in the 
country see now roughly a $3,000 increase per year once this is 
effective; and, hopefully, it will not be effective. This bill still 
hasn't passed. These bills just got filed 2 weeks ago, and the American 
public is starting to digest it.
  I think the AIG scandal that just erupted in the last few days shows 
people what the fine print really means. When that stimulus bill that 
the President said that we needed to rush through, didn't want to give 
anybody in Congress a chance to read the fine print, those of us who 
voted against it, and I know everybody talking tonight, the reason we 
are here tonight is because we opposed those bad policies because we 
knew it was bad policy, not because we want to be against or for.
  Mr. AKIN. Reclaiming my time, gentleman, you have moved into a 
subject that I definitely wanted to get to tonight. I think this is 
something that our other congressional friends who are joining us 
tonight, and others, perhaps, would want to understand because this is 
an extremely exciting juncture really where we are timewise today and 
tomorrow.
  I want to recreate what happened here on the floor less than 2 weeks 
ago. First of all, we voted for a measure that said when this great big 
bill, this supposedly stimulus bill, which I somehow call ``porkulus'' 
bill, when it comes out, we will have 48 hours to read the thousand-
plus pages so we have some idea what is in this bill. And everybody on 
this floor voted that we would have 48 hours to have time to look at 
what was in this bill. It was $700-plus billion. We are talking about 
enough money to buy at the rate of--I think of big things because I am 
on Armed Services, you could buy at the average cost 250 aircraft 
carriers with this much money that we don't have. And we only have 11 
in our country.
  Mr. PITTS. If the gentleman would yield, we have to borrow that 
money. That is all borrowed money, $787 billion. When you add the 
interest on that, that amounts to about $1.1 trillion, the price tag of 
that one bill.
  Now President Obama said right before we voted that we are in a 
crisis and we must pass this stimulus bill immediately or we may suffer 
a catastrophe. That is the kind of rhetoric that scares the market. We 
need to stay away from the rhetoric of fear and panic and disaster and 
catastrophe, a lot of which has been used to pass these bills. That 
bill you are referring to was 1,174 pages long. It wasn't put on the 
web until after midnight. The next morning at 9:00 we were debating and 
voting on that bill. Not one Member had a chance to read that bill. 
That is legislative malpractice.
  Mr. AKIN. Reclaiming my time, so what happens? We vote for 48 hours, 
the bill comes along and we are supposed to have 48 hours, and we get a 
copy of it at 11:30 Thursday night; 1,100-plus pages, more than a 
thousand pages, as you said. So we get a copy of it. And, of course, we 
have lots of staffers sitting around at 11:30 just waiting

[[Page 7850]]

for the bill, right. The next day what do we do, we vote on the bill.
  Now of course what happened was the Republicans voted ``no.'' There 
was talk about we are going to have transparency and we are going to 
have bipartisanship on the floor. Republicans asked, Hey, I thought we 
had 48 hours? Do we have any way to get our 48 hours?
  The answer was: No, we are going to vote on it.
  We didn't like that, partly because of the tremendous cost of it, and 
also because what is hidden in those thousand-plus pages? That brings 
us up to today.
  Where we are today is we find that hidden in this bill in conference, 
put in according to ABC by Senator Dodd, was an amendment that says 
that the executives from AIG insurance company, and a lot of them live 
in his district, that those executives can keep their $165 million in 
bonuses. Now the public is upset about $165 million in bonuses, and I 
can't say that I blame them. But on the other hand, they should be even 
more upset. It is not just millions, you have to look at that letter, 
it is billions or trillions.
  I yield to the gentleman from Pennsylvania.
  Mr. PITTS. I have a copy of that press account that occurred 
yesterday. It was ABC News. Jonathan Karl reported this: ``Last month 
the Senate unanimously approved an amendment to the stimulus bill aimed 
at restricting bonuses over $100,000 at any company receiving Federal 
bailout funds. The measure, which was drafted by Senator Olympia Snowe 
of Maine and Senator Ron Wyden of Oregon, applied these restrictions 
retroactively to bonuses received or promised in 2008 and onward.'' But 
then the provision was stripped out during the closed-door conference 
negotiations involving House and Senate leaders and the White House, 
and a measure by the Senate banking chairman, Chris Dodd of 
Connecticut, to limit executive compensation replaced it with an 11-
page amendment. Dodd's measure explicitly exempted bonuses agreed to 
prior to the passage of the stimulus bill.
  That should be investigated. That is the news story you are talking 
about.
  Mr. LATTA. If the gentleman from Missouri would yield, I think the 
real question is where is this taking us? As the gentleman mentioned, 
$1.1 trillion, and the American people and the folks in my district are 
saying this: $1.1 trillion, what is this all adding up to?
  Right now, this country is $10.6 trillion in debt. By the end of this 
fiscal year, this country is going to be $12.7 trillion in debt; $12.7 
trillion.
  And it hasn't been very long, when you start looking at the figures, 
in 1979, the national debt of this country was only $129 million. We 
went to $2.8 billion in 1989, and it started going up. But when you 
start looking at the totals, the thing that really concerns me is not 
only are we building this debt up, but we have a $1.75 trillion 
deficit. The real question is: Who is buying this debt? Who is buying 
this debt?

                              {time}  1900

  Right now, we have a $3 trillion debt that we owe to foreign 
countries and governments, $727 billion is what we owe the Chinese 
right now--they are our largest debt holders--and that is not counting 
what they own in Fannie and Freddie, which takes them over $1 trillion 
of our debt.
  What is happening in this country is, we are going to not only have 
problems in this county trying to pay this back, but we also have a 
problem in this country, we have a situation where we are trying to 
say, in our foreign policy, who is going to start dictating it, us or 
our debt holders? And that scares the living daylights out of me.
  Mr. AKIN. Reclaiming my time, when you start talking about debt, the 
public understands one thing; you have a bunch of executives who have 
run a company into the ground, and then they're picking up $165 million 
in bonuses for doing it, and out of the pockets of the U.S. taxpayer. 
The one thing is if you think people are mad now, if $165 million 
bothers them, when they start looking at the billions and trillions 
that are being wasted with no transparency at all, they are really 
going to be getting mad.
  We are also joined, I see, by my friend, Congressman Scalise from 
Louisiana. I will yield to the gentleman.
  Mr. SCALISE. As we complete the thought that we've been talking 
about, these were all things that didn't just happen by accident. This 
was in legislation. We are not talking about the previous 
administration. The word ``inherited'' seems to be thrown around a lot 
here. The same people that support the death tax seem to be trying to 
say they inherited every problem that exists. And there sure is blame 
to go around from people in years past, but we don't have time to talk 
about the past. What we do have time to talk about is what is happening 
today.
  In the stimulus bill that everyone here tonight is talking about, 
these problems and the ramifications throughout the country, throughout 
our economy, with what is happening with these policies, this was in 
legislation that was passed by this President. Just 3 weeks ago, he 
signed that stimulus bill that he himself pushed through Congress, said 
it had to be pushed through at record speed, didn't want to have the 
accountability and the oversight. And so Congress literally, in 2 
weeks, spent a record amount, $800 billion, that we all voted against 
because we knew it was bad policy. But the President said we need to 
act soon, and this is all critical to getting our economy back on 
track. I mean, look at the details.
  Mr. PITTS. Will the gentleman yield?
  Mr. SCALISE. Yes.
  Mr. PITTS. I know the public might sometimes be confused by all these 
bills we talk about. There was a $700 billion bailout bill; there was a 
$787 billion stimulus bill; there was a $410 billion omnibus bill--the 
one that had the 8,500 earmarks that he signed last week that just 
funds the government for the rest of this year; and then now we have 
this proposed budget of $3.6 trillion.
  Now, the gentleman from Ohio was talking about the Chinese owning 
$726 billion of our debt. You know, I met with a Chinese delegation 
last month of officials from China, and the first question they asked 
me was, Congressman, is America abandoning the free market system? I 
mean, the world is watching this. And they have expressed some 
hesitancy about buying more of our debt. I think when we go on the 
market with $2 or $3 trillion in treasuries this year to fund our 
budget, we are probably going to have to raise interest rates on those 
notes, or else we're going to have to print money. We are going to feed 
inflation. At the end of this year, I am afraid we are going to see 
inflationary pressures that is going to impact every consumer, just 
like the energy tax.
  Mr. SCALISE. Reclaiming my time, and what you're talking about is 
something that we are already starting to see; it's problems that 
happened in the 1930s during the Great Depression. And unfortunately, 
it seems like history is repeating itself because we are seeing that, 
now that countries are saying we're concerned about this level of debt 
that America is going into, families across this country are concerned 
about this level of debt.
  It seems like, in Washington, that this liberal leadership is the 
only group that wants to go on this wild spending spree. The good news 
is it hasn't all happened yet. Some of it has. That $800 billion 
stimulus bill that we talked about that didn't do anything to stimulate 
our economy that President Obama signed, that bill that had the 
language that protected AIG's bonuses that we're all outraged about--
and it is kind of ironic when you see those people feigning their anger 
and saying those people are getting these bonuses, $160 million--that I 
agree is offensive; the problem is, they put the language in. This 
President signed that bill that protected those bonuses.
  The record is clear. You can go back and look at it. And I think my 
friend from Missouri actually pointed out the chronology of how that 
got thrown in, airdropped in in that final report.
  I yield back.
  Mr. PITTS. You said wild spending spree. I really think this is by 
design.

[[Page 7851]]

I think they are exploiting the financial crisis to move their 
political agenda and tuck into these big spending bills--that they are 
not permitting anybody to read--all of these issues that we are now 
reading about, like repealing welfare reform, that worked well, that 
the Congress passed back in `96. Now there is an incentive from the 
Federal Government to the States, 80 percent match for every new 
welfare recipient you add.
  Mr. AKIN. Reclaiming my time, I like to get right up because we are 
talking about something that has been happening today. This is on the 
news. I think this is a very interesting kind of scenario.
  So what happened a couple of weeks ago was, first of all, you had 
this tremendously expensive bill which was called stimulus--that I call 
porkulus. It came along. We were promised we would have 48 hours, we 
did not. It came to the floor. The Republicans voted ``no'' on the bill 
because it was way too much money, but also, we didn't even have a 
chance to know what was in it. But who did know what was in it? Well, 
certainly, according to ABC, Senator Dodd knew that he had allowed 
these executives from AIG to have this $165 million in bonuses for 
shipwrecking their company. Now what we have going on is we find out in 
testimony today that the administration knew that that was in the bill; 
obviously they would have probably had some people scan it before the 
President signed it.
  So now that the President, the administration, was aware that this 
was in the bill, that the executives were going to get their $165 
million, that it was put in there by a Senator--who, by the way, had a 
loan for 3 percent on his home, who also got more money from AIG than 
any other Congressman. AIG gave him over $100,000 in 2008. The only 
second-place contender was the President. So the President and the 
Senator both received over $100,000 from AIG. This amendment was 
slipped into this bill--and we, of course, didn't know it when we voted 
``no'' on the bill.
  So, what is going to happen tomorrow? I am going to finish what is 
going to happen tomorrow, and then I would encourage some discussion, 
because this is kind of like a little case study. Because now the 
Democrats have put this amendment in, these executives are getting 
their $165 million, and the public is going crazy. They are mad. They 
are ready for somebody's scalp. And so we are going to bring a bill to 
the floor which is going to say that we are going to tax these 
executives at a rate of 90 percent. Well, that's interesting, isn't it?
  We already knew they were going to get paid, and so now we are trying 
to somehow put the toothpaste back in the tube. We are going to tax a 
couple of specialized, specifically named people at 90 percent--which, 
of course, is unconstitutional. How would you like it if somebody could 
single you out as the only guy on your block and we are going to tax 
you at 90 percent, but nobody else? It is completely unconstitutional.
  So they are going to bring a bill to tax these guys at a 90 percent 
tax rate, which will make a lot of Americans on the surface think, oh, 
this is a pretty good idea. And if we vote no because it's 
unconstitutional--because we took an oath of office to protect the 
Constitution--- we look like we are defending people getting $165 
million for crashing this company. So that's a pretty clever thing to 
do; it's a good diversion.
  I thought it was a brilliant piece of strategy to try to cover the 
fact that the Democratic Party knew that this thing was in the bill all 
along, did not take any actions. Now people caught them. Now people are 
mad. And so what we are going to do is we are going to start this 
unconstitutional policy of taxing somebody. Now, the question then 
becomes, what are the Republicans going to do tomorrow morning? That's 
going to be an interesting question.
  I yield to my good friend, the doctor from Atlanta, Georgia, 
Congressman Gingrey.
  Mr. GINGREY of Georgia. Well, I thank the gentleman from Missouri for 
yielding. And I thank the gentleman from Pennsylvania, Congressman 
Pitts, for holding this hour-long discussion, Mr. Speaker, and my 
colleague, Representative Latta from Ohio, and others that have spoken. 
I appreciate the opportunity.
  And Representative Akin just mentioned, my colleagues, that tomorrow 
we are going to have this bill under suspension that so-called ``gets 
our money back.'' It's telling the American public, oh, we are going to 
get our money back from these absolute scoundrels that got these 
bonuses--in some cases, $1 million, I think there were a couple of 
cases where people got $3 million, and in the aggregate, something like 
$160, $170 million. I will tell you, I would call those bills, the bill 
tomorrow, the ``unrighteous indignation'' bill, or maybe the ``majority 
mendacity'' bill. Because what this majority party wants to do, Mr. 
Speaker, is posture themselves like, oh, you know, we are going to go 
after the bad guys, when, as the Congressman just pointed out, when you 
connect the dots, when you follow the dots in some of those charts that 
were presented earlier and you see that we have actually given this 
insurance company, American International Group, $190 billion, that is 
over a thousand times as much as these bonuses.
  So the real issue, which they are diverting our attention from--they, 
the majority party--and don't want the American public to realize what 
they have done----
  Mr. AKIN. Reclaiming my time for a second, you just gave us a number 
thing. It is hard to keep all those zeros straight. You are saying that 
we just gave--as I recall the number was $173 billion to AIG. How does 
that compare to $165 million? What was the ratio?
  Mr. GINGREY of Georgia. Well, reclaiming my time, you add three zeros 
to that. A million is six zeros. A billion, if I am correct, is a 
thousand million.
  Mr. AKIN. So a thousand more than this executive pay thing?
  Mr. GINGREY of Georgia. This is what we are talking about, literally, 
the money that was given to this company.
  I know, Mr. Speaker, the American people, when you explain that to 
them, they can understand it. And they say, well, now, wait a minute, 
this is an insurance company. I've got my life insurance, I've got my 
health insurance with Prudential or Provident or Aetna or any other. I 
mean, it's not like it was the only insurance company in the world. And 
this business of being too big to fail--because what they did is they, 
in these subsidiaries, they weren't just satisfied with making money 
off selling life insurance, they had to get into this business of 
selling these financial products, these credit default swaps and 
mortgage-backed securities and derivatives, things that the common man 
doesn't even know what you're talking about. But it's all about greed.
  And I am telling you, this business of bailing them out with our 
money, taxpayer money, Mr. Speaker, people like my constituents in the 
11th District of Georgia who are struggling every day, some of them, 
through no fault of their own, losing their homes, losing their jobs--
particularly if they're in the construction business--can't get loans. 
And here this majority party is continuing to give this company--and I 
think my figure is right, Mr. Akin, that $190 billion will be the 
amount, the bailout money that, in the final analysis, we have given 
to--and maybe that's not the final analysis. Maybe we are going to say, 
oh, we are going to get the $170 million in bonuses, but we are going 
to give another $25 billion to this company.
  I yield back to my colleague.
  Mr. AKIN. That does raise, though, an interesting question. Because 
here we are, we are in the middle of this whole situation. We 
understood that there wasn't time to look at what was in the bill. We 
know that this prominent Senator, that is in the same home as AIG, who 
has got that 3 percent loan on his house, he has received more money 
than any other Member of Congress--House or Senate--from AIG, that he 
put the amendment in to protect those bonuses. And the administration 
knew that was in there, and yet

[[Page 7852]]

there is this sort of a mock sense of, hey, we are really upset about 
this. So what we are going to do is we are going to just ignore the 
Constitution and tax these guys at 90 percent. And then that puts us in 
a trick box as Republicans; do we vote to ignore the U.S. Constitution 
or do we vote to try to make some claim on these guys' salaries?
  Mr. GINGREY of Georgia. If the gentleman would yield just for a 
second on this point, and then I will yield back to my colleague from 
Pennsylvania, Representative Pitts.
  On this particular issue, don't forget, my colleagues, that at that 
so-called ``conference committee'' back in the fall when this economic 
stimulus bill, all the details were being worked out, the majority 
party was there in the dark of night. I don't know how many conferees 
from the minority party were there, but the administration was 
absolutely there when this provision, as my colleague said, was put in 
by the Senator from Connecticut, Senator Dodd, in regard to making 
those changes so that these employees of AIG could get these bonuses. 
But a representative of the administration, the new administration, the 
Barack Obama administration, Mr. Speaker, was in the room and knew 
exactly what was happening. And the second largest recipient of 
contributions, when he was in the United States Senate, from AIG was 
none other than Senator Barack Obama. I think it's very important that 
the American people understand these things and try to connect the 
dots.

                              {time}  1915

  Mr. PITTS. I just want to say after hearing the gentleman, I can only 
say one thing: Please, no more bailouts. Look at the market and see 
what has happened with these big bailout bills.
  I would say the message that I'm trying to convey here tonight is 
that policies matter. And some policies help create an environment in 
which the economy is able to thrive, and wrong policies have the 
opposite effect. So let's learn the lessons that we can learn from 
these charts. Let's get good policies again. Let's get our spending 
under control. Let's not tax too much. Let's not waste money. Let's not 
borrow too much. And if we will pursue good policies, then, hopefully, 
the market will start responding again the way we'd like to see it.
  And I thank the gentleman for yielding.
  Mr. AKIN. Reclaiming my time, gentleman, when you talk about 
consequences, just taking a look at that one bill alone, which was the 
thing they called the ``stimulus'' bill or the ``porkulus'' bill at 
$800 billion, $800 billion that we don't have. We only have a 300-ship 
Navy. We're talking 250 aircraft carriers as the equivalent cost. But 
let's talk about what the indebtedness of that is. Just that one bill, 
what that would mean would be nine new aircraft carriers every year. 
That's just the cost of the debt that we're getting into.
  Mr. LATTA. Will the gentleman yield?
  Mr. AKIN. I will yield.
  Mr. LATTA. I think the number I'm now seeing is that by the year 2012 
we'll be paying a billion dollars in interest on the debt every day, 
which is absolutely putting our future generations in the hole that 
they're never going to climb out of. And that worries me with our kids 
back in Bowling Green and what we're going to do to their future. And I 
don't think it's right what this Congress is doing.
  I think a little earlier I might have misspoken when I was talking 
about some of the debt numbers. You start throwing around billions and 
trillions, and I think the numbers I should have been saying were 
trillions when we talking about the debt in 1989 and 1999 and 2007. But 
those numbers keep going up. And we can't have that going on because, 
again, as I've mentioned and as all the gentlemen have mentioned this 
evening, when you look at what we have been doing to this country and 
owing foreign governments only $119 billion in 1979 and, as I said a 
little bit ago, that we now owe over $3 trillion. As the gentleman from 
Pennsylvania mentioned, the problem we're going to be having is that 
we're going to have a situation with this debt going up. The President 
has already said if we can't get people to buy that debt, we're just 
going to have to raise that interest rate. And as I mentioned a little 
bit earlier, we're going to be right back where we were in the late 
1970s with President Carter when we had 21 percent interest rates, and 
the problem is going to be that no one is going to be able to get any 
loans out there and the situation we're going to be in is a dire one 
because back 30 years ago, this country was on top of the heap. China 
is now the number one manufacturing country in the world, not the 
United States. They've passed us this year, and now we are going be in 
a situation where how do we climb out of it?
  Mr. AKIN. Reclaiming my time, to summarize what we have been talking 
about in a way, first of all, we're taxing too much; second of all, 
we're spending too much; and third of all, we're borrowing too much. 
That's basically the way things are going. We have tried that approach 
before. We tried it during the Great Depression. It turned a recession 
into the Great Depression. Henry Morgenthau was the one who made it 
clear that it hadn't worked.
  And take a look at what's going on here in the situation with the 
jobs that have been lost since the Democrat majority, and you see 
what's going on is this thing is really going up in terms of jobs lost. 
Why is that? Well, because small businesses are getting hammered and 
they're the source of a great number of those jobs. So if we do not 
have the liquidity and we don't allow the small businessman to keep 
some of what he earns and to invest in his company, we lose jobs. And 
this is what's going on. It's predictable. It's happened this way for 
years, all throughout history. And the solution is straightforward. 
There is a solution. We don't have to go down this path. But it means 
that we have to stop spending, we've got to stop taxing, we've got to 
stop borrowing, and what we have to do is let some liquidity back for 
the small businessman, and you'll see this job thing turn around.

                          ____________________