[Congressional Record (Bound Edition), Volume 155 (2009), Part 7]
[House]
[Pages 8765-8772]
[From the U.S. Government Publishing Office, www.gpo.gov]




                CHALLENGES AND TROUBLES WITH OUR ECONOMY

  The SPEAKER pro tempore (Mr. Bright). 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, it's a pleasure to join you this evening and 
to talk about some issues that are of significance to all of us. And I 
thought that what we might do this evening, starting out, was just take 
a look at--many people are conscious of the fact that we've got some 
challenges and troubles with the economy. People are aware that we have 
a problem with jobs and having enough jobs to go around. We have some 
difficulties on Wall Street, as people know. We have difficulties on 
Main Street.
  We have been told over a period of the last six or 7 years that we 
spent a whole lot, too much money in the war in Iraq and in 
Afghanistan. In fact, we have been regaled every day with stories about 
oh, we're spending more and more money.
  But just to kind of put perspective on how much we have been spending 
lately, let's just consider the 6 years of the war in Iraq and add up 
all the money we spent in the war in Iraq, and then let's add to that 
the amount of money that we spent in Afghanistan. And you put the two 
together, and it's less money than we've spent in the first five weeks 
when this Congress was in session. That's kind of an amazing number.
  We spent this, supposedly stimulus bill, $840 billion. What is $840 
billion? Well, it's more money than we've spent in both of these wars 
over the past six and 7 years all added up, combined.
  So how did we get into this situation that we are spending so 
tremendously much money?
  I recall, the President made a statement. It said, ``We cannot simply 
spend as we please and defer the consequences.'' And many of the 
President's statements are noteworthy. This is a good statement. ``We 
cannot simply spend as we please and defer the consequences.''
  The only question is, when you take a look at the level of spending, 
these blue bars was President Bush, and these red bars, now, become the 
Democrats and particularly, here, this is this year. Now, this is not, 
doesn't have projections in it for economists making all kinds of 
predictions. This is actually what we are spending. And you see how 
much the spending has gone up. And so this line doesn't square too well 
with ``We can't simply spend as we please and defer the consequences.''
  So how did we get into this really heavy, big spending kind of 
situation?
  I think it's helpful--people say, oh, we just have to keep looking 
ahead and solving problems. I think it's good to look ahead and solve 
problems. I think it's also possible to take a look and see where did 
we make mistakes and what do we need to make sure that we don't do 
again. I90[H25MR9-R1]{H4012}
  And if you take a look at how we got the economy in trouble, the 
story goes back, actually, a good number of years. It goes back even as 
far back as 1968, and that was when Fannie Mae was created. It's called 
a government-sponsored enterprise. It's not really private. It's not 
really government. It's sort of half and half. And so '68 we created 
Fannie Mae, and then in 1970, Freddie Mac. And the purpose of these 
organizations was to make it so that Americans could afford to own 
homes. And that is, of course a good thing. We all appreciate the 
American dream, particularly having, when you come home after a hard 
day's work, have a place that's really your palace. Maybe not a fancy 
palace, but it's at least a place where there should be some peace and 
when you can say yeah, this is my house. And that's always been part of 
the American dream.
  And the idea was to create these agencies, to allow more people to 
have a chance to own their own home. And that was what a good enough 
idea to start with. But then we started to tamper with the idea some in 
1977 with the Community Reinvestment Act, which mandated that Freddie 
and Fannie--or in the Community Reinvestment Act it mandated more banks 
had to make loans that were risky loans, not the sort of loan that a 
local bank would know the people living in their area and they'd say, 
oh, this is a good guy and he wants to buy a home, but we know he'll be 
able to pay his loan, so we'll go ahead and make that loan and we'll 
keep that on our books and allow that to go forward. And then every 
month we know this man in our community, we know he'll pay off his loan 
and soon he'll be a proud homeowner.
  No, this was not what happened with the Community Reinvestment Act. 
What we're saying now is that banks have to lend money to people who 
might not be able to repay those loans, and the government's starting 
to say, you've got to make these loans that are not so good.
  Well, in 1992, the Federal Housing Enterprise Financial Safety and 
Soundness Act mandated that Freddie and Fannie buy risky loans from the 
banks. So now pretty soon, you've got this and it's gone a little 
further. It's not just that the bank is going to make some risky loans, 
but now the bank has the option of dumping the risky loans on Freddie 
and Fannie. So you can see where this is going. What's starting to 
happen is that we're passing the accountability. And guess who's 
finally going to end up holding the bag? You guessed it, the U.S. 
taxpayer.
  Well, here's what's going on. Now, this enterprise is saying you can 
take

[[Page 8766]]

these bad loans, pass them on to Freddie and Fannie. Well.
  Then we go to 1999, and under the Gramm-Leach-Bliley Act, this is 
where President Clinton expanded the number of bad loans, not maybe bad 
loans, but much more risky loans that Freddie and Fannie had to take. 
And so Freddie and Fannie now are picking up more and more of loans 
where it's not so clear people are going to be able to pay these 
things. And so Freddie and Fannie start to do some exciting footwork 
with their finances, and start packaging these loans up in unique ways, 
and selling them, through Wall Street, all over the world. And so this 
is going on in '99.
  Now, other things are starting to take effect here. The economy was 
not so good in '99. And so, Greenspan, at that time, lowered the 
interest rate, took it way down so it created a whole lot of available 
liquidity, and the housing bubble starts going. And this was the year 
that I was elected to Congress, 2000. So 2001, if I'd come down here, I 
was really kicking myself by 2005 because anybody who bought a house in 
Washington, D.C., why, that house would have doubled in value in about 
5 years. You're saying why in the world didn't I buy some big house in 
D.C.? And then later on you think, I'm glad I didn't.
  But anyway, we haven't gotten there yet. So this is what's happening 
in 1999. Then things start to--the train starts to come off the track.
  In 2003, Freddie and Fannie get investigated by The Securities and 
Exchange, and they admit that $1.2 billion accounting error. At that 
particular time, President Bush, seeing that, had been warned. Now 
there'd been some warnings before, back in 1999. New York Times, 
there's an editorial saying, we are setting up a problem. And here's 
the problem. You've got a whole bunch of loans that are very 
questionable, more and more questionable loans. And who is going to 
back up those loans? Who's going to end up having to pay for them if 
people default on their loans? So this is, who's going to pay? Well, 
Freddie and Fannie have all of these things. What's the implication? 
Well, Freddie and Fannie are backed by who? By the U.S. government. So 
if the loans are bad, now the U.S. government is, maybe not obligated, 
but pretty much obligated. By this time, Freddie and Fannie have got 
more than half of the home loans in America. So is the government going 
to turn their back and say, oops, all of this is stuff is just going to 
go away? No, of course. So this is starting to come along.
  By 2003, the President sees these problems, and in this article, on 
September 11, 2003, the article, this is New York Times, September 11, 
2003, it says hear, ``The Bush administration today recommended the 
most significant regulatory overhaul in the housing finance industry 
since the savings and loan crisis a decade ago.''
  So here you have, Republican President Bush is saying, uh-oh, guys. 
We've got trouble. We need to get into Freddie and Fannie. We need to 
regulate them some because they're starting to get wild and wooly with 
their financial wheeling and dealing, and what's going to happen is the 
government and the taxpayer are going to end up getting caught on the 
hook.
  Well, what was the response? And did we go ahead and take the 
President's recommendation and move forward with further regulations of 
Freddie and Fannie?
  Well, he was opposed. The same article in the New York Times, same 
one, September 11, 2003, the ranking Democrat of the Financial Services 
Committee, Congressman Frank, is quoted in this article. ``These two 
entities, Fannie Mae and Freddie Mac, are not facing any kind of 
financial crisis'' said Representative Barney Frank of Massachusetts. 
Now, I think he didn't think they were facing any particular kind of 
crisis. But he was the ranking member on this committee. That means he 
was in the minority party in 2003. But he was opposed to what the 
President was suggesting, and that was a strong reining in of Freddie 
and Fannie's practices. Now, he, by himself, of course, couldn't stop a 
legislation because he was in the minority party.
  So, following 2003, you have, in addition, you have the Bush 
administration in 2004, again, this is committee testimony saying, 
we've got to get on to Freddie and Fannie. And then by 2005, a bill was 
passed in the House. It was mostly, the one in the House was mostly 
voted for by Republicans. It was opposed by a majority of Democrats, or 
quite a number of Democrats. And the bill passes out of the House and 
then goes over to the Senate.
  Now, the Senate is kind of an odd body because over there it takes 60 
votes to get something passed. And as the New York Times reported, the 
Democrats were not in favor of this additional regulation on Freddie 
and Fannie. So here is another version, the Senate bill 190, it's the 
Federal Housing Enterprise Regulatory Reform Act 2005. And the Senate, 
it was passed out of the Committee on Banking and Housing and Urban 
Affairs, but the floor action was blocked by the Democrat minority.
  So there's a difference, a political difference here, that the 
Republicans were in support of more regulation of Freddie and Fannie. 
Democrats were opposed to that, killed it over in the Senate.

                              {time}  1830

  Now, what happened then, of course, is that all of these bad loans 
spiraled more and more out of control, and as they did so, they started 
to create havoc in other parts of the economy. Now, was this problem 
created entirely because Democrats refused to regulate Freddie and 
Fannie? No, not entirely because of that. It was a very important 
component. Certainly, the bad loans are what put us on track for a very 
serious world economic situation. There was more to it, though.
  There were people on Wall Street, such as Standard & Poor's and two 
other rating agencies--the ones that give us our credit ratings 
personally. They are the ones that said that all of these mortgage-
backed securities were a AAA rating. Well, that turns out to also have 
been not a very wise thing, and they were not AAA rated. In fact, most 
of them have gone into default enough so that there is no longer any 
market for these mortgage-backed securities. So now we are at the point 
in the last year or two where we have what is clearly a recession on 
our hands. So what do you do with a recession? There are two basic 
theories about how you handle this.
  The first one goes back to FDR and to his Secretary of the Treasury, 
Henry Morgenthau. Morgenthau, along with a guy, little Lord Keynes--he 
was a little weird, but he was an economist anyway--came up with this 
idea that when the economy gets in trouble what you have got to do is 
to stimulate it, and so what we are going to do is spend a whole lot of 
money, and that is going to make the economy a lot better. So they 
tried that during the Great Depression. After 8 years of stimulating--
that is, spending tons and tons of taxpayer money--you have the guy who 
really came up with this scheme, Henry Morgenthau, now appearing before 
the House Ways and Means Committee in the year 1939. He talks about: 
How well does it work if the government spends a whole lot of money to 
get itself out of an economic fix? Well, here is what his quote was:
  ``We have tried spending money. We are spending more than we have 
ever spent before, and it does not work.''
  This is the guy who supports this Keynesian model of economics, which 
says, hey, the more you spend money, the more it's going to fix the 
economy. After 8 years of the administration, we have just as much 
unemployment as when we started--and an enormous debt to boot.
  Now, this is a lesson that Henry Morgenthau learned in 1939. He 
learned it at the cost of 8 years of Americans being out of jobs. He 
realized that this does not work. The Japanese did not learn the 
lesson, and in the '70s, they took their economy through 10 years of 
big government spending to try to get their economy going, and it did 
not work.
  So what we have then is the problem of an approach to fixing an 
economic

[[Page 8767]]

crisis which creates unemployment, and of course unemployment--lost 
jobs--really, really hurt an awful lot of common people. A lot of 
people who have worked hard all of their lives, who are trying to pay 
their mortgages off, lose their jobs, and now their houses are 
foreclosed. I think sometimes, in my own mind, of being the father of a 
family with a wife and with kids depending on me. I think of what it 
would be like to come home at night and see your living room furniture 
sitting on the sidewalk, and you're being tossed out of your house. 
That is the kind of thing we risk when we start using bad government 
policies. When we start to take this process of having people being 
encouraged to take loans that they cannot afford to take, we lose jobs, 
and things start to come undone.
  There is a different approach, another way, of dealing with a 
recession. One way of dealing with a recession that we mentioned is, of 
course, the Keynesian model, or the idea of spending your way out of 
trouble. Now, we need a little bit of common sense down in Washington, 
D.C. We need a little common sense in Congress. Most people in a lot of 
our districts know that, if you get in trouble economically, the thing 
you do is you don't go buy a brand new car and spend money like mad, 
hoping it's going to get better. That's just plain crazy, and yet that 
seems to be what the government is doing.
  Let's take a look and see what our response has been, because there 
is another approach. There was the same approach that was used by JFK, 
by Ronald Reagan and by President Bush, all three times effectively 
turning a recession into good, solid economic times. I've got a couple 
of charts here. I just want to throw a couple of these up because this 
is the heart of where we are in America today, and it affects every 
man, woman and child in our country.
  What I have here right in front of me is the danger of using that 
Keynesian model--spending money out of control. Let's take a look at 
this chart. This is a pretty easy one to understand. I know charts are 
sometimes a little confusing or you have to try and figure out what 
they're saying, but this just tells you whether or not the family 
budget got balanced. Every single one of these bars is a line, and if 
the line goes down, it means the government spent too much money. If 
the line goes up, it says we actually did not spend as much as we took 
in. So, just like the family budget, the down lines mean, uh-oh, we 
went into debt. We're going back all the way here to 1980 and are going 
out here to this very year where we are.
  So what has happened? Well, we've been spending too much money for a 
long time here. About how much too much? Well, you know, $3 billion to 
$400 billion worth. That's a lot of money. Here we had a couple of good 
years where we actually made some money. This was a Republican 
Congress. Bill Clinton and the Congress said we're not going to spend 
much money, and there were some disagreements. We actually saved some 
money for a couple of years. These years right in here are the 8 years 
of Bush, and Bush was criticized for spending too much money. I voted 
against some of that spending, and here is what the spending was:
  You can see that probably the worst spending was somewhere in the 
range of about $400 billion. Now take a look at what happened this year 
in 2009. My goodness, this is absolutely unprecedented. That is the 
level of spending in 2009. Guess what? We're not done with 2009 yet. So 
this tells you that we have taken an approach which is saying, boy, are 
we going to spend some money. You can say that, maybe, President Bush 
spent too much money. I think he did, but it is nowhere near what we're 
seeing, and so this spending pattern seems to be in great contradiction 
with the statement that says: We cannot simply spend as we please and 
defer the consequences. This is what he said, but look at what we are 
doing.
  I am joined here in the Chamber tonight by a very good friend of mine 
from Louisiana, Congressman Scalise.
  I know that you've been paying attention to some of these issues and 
have already, rapidly, distinguished yourself here in the Congress. I 
would appreciate it if you would give us your perspective on what's 
going on this evening.
  Mr. SCALISE. Well, I want to first thank my friend from Missouri for 
yielding and for hosting this hour to talk about the real dangers of 
this road that we're going down. This is a budget proposal, this budget 
that we're talking about, especially these record levels of spending, 
but they are all proposals right now that have been filed by President 
Obama. Some of these are bills that have not even gone through 
committee yet but that are going to be going through committee.
  I think what is happening and what we are seeing around the country 
is that the American public, during these tough economic times, is 
dealing with their problems. Families are cutting back right now. We 
are seeing that all across the country. People are saving money. They 
are paying down debt because they know that we are in tough times. We 
all hope that we get out of these tough times soon, but I think what is 
concerning people are some of the policy decisions coming out of 
Washington right now: these proposals by President Obama for these 
record levels of spending, with record levels of borrowing and of not 
borrowing from a savings account but borrowing from our children and 
grandchildren--because this is money we don't have-- coupled with 
record tax increases. These are not just tax increases on the rich--and 
I don't think class warfare is a good thing at any time. It is surely 
not a good thing now, during these tough economic times, to be 
threatening over $600 billion in new taxes, the bulk of which will fall 
on the backs of our small business owners--on the people who actually 
hire and employ 70 percent of the American workforce right now.
  Mr. AKIN. Reclaiming my time just for a second, you are talking about 
these different tax increases and different things that are spending 
money. It's starting to get a little bit hazy because there are a 
number of them coming along, and it's easy to get them confused in your 
mind where it was that we spent money and how much. So I have put 
together some of the real big ticket items. I mean we're only into 
March, right? I mean it's only the first quarter. Let's take a look 
here.
  This is the Wall Street bailout. It started, actually, at the end of 
the Bush administration. They did, I think it was, $300 billion or $350 
billion, something like that.
  Mr. SCALISE. $350 billion.
  Mr. AKIN. $350 billion.
  Then, under President Obama, we got the other $350 billion. So half 
of this is Bush and half of this is President Obama. Then we've got 
this economic stimulus--I call this the porkulus bill--and that was 
$787 billion in its final form. Then we've got the appropriations bill 
that we passed. That's another $410 billion. So, you know, we are well 
over $1 trillion here in less than--what is it?--3 months.
  Mr. SCALISE. Sixty-five days to be exact.
  Mr. AKIN. Sixty-five days.
  I just thought it would be helpful to have those numbers up there. 
The main thing was the Wall Street bailout, then this porkulus bill and 
then this appropriations bill.
  I yield.
  Mr. SCALISE. What you are pointing out is exactly the concern that is 
going on throughout the country, the fact that, in the 65 days 
President Obama has been in office, our country has already incurred 
over $1 trillion in new debt. We keep hearing the word ``inherited'' a 
lot, and the President tries to imply that every problem that is out 
there and all of these spending bills are all things that he inherited.
  First of all, the porkulus bill, as you call it--the spending bill 
that added over $1 trillion of new debt, which was his major 
initiative, his first initiative--actually was something that President 
Obama decided to do on his own. That added another $1 trillion. His 
budget that he has filed is a record.
  This is a chart here that depicts the budget deficits over the last 
few years,

[[Page 8768]]

but then project it forward under President Obama's budget, and you can 
see the first year of President Obama's budget is a record. It was $1.7 
trillion. Just on Friday of last week, the Congressional Budget Office 
updated the numbers because they recognize now there is even more 
deficit spending, and they recognize the fact that now there will be 
over $1.9 trillion of deficit spending just in President Obama's first 
budget.
  This is not a budget President Bush proposed. In fact, President 
Bush's last budget, as you can see, was somewhere in the $400 billion 
number, a number I'm not comfortable and, I'm sure, that my friend from 
Missouri is not comfortable with.
  Mr. AKIN. Reclaiming my time, we have gone from $400 billion to $1.7 
trillion?
  Mr. SCALISE. More than tripling the deficit in just 1 year, and this 
is the latest projection. Now it is $1.9 trillion, roughly, in deficit 
spending that President Obama's budget has.
  Clearly, this is not an inherited number. This is something that he 
has proposed spending and that we are going to fight. We are actively 
fighting it right now. I think, if you look across the country, the 
American people are seeing what these record deficits would mean. When 
the President says--and he said it again last night--that he wants to 
cut the deficit in half, I think a lot of people are starting to 
realize now that what he is saying is kind of a play on words, because 
he is not talking about cutting the deficit in half from the deficit 
that he truly inherited. He inherited a $400 billion deficit--again, a 
number that, I think, is too high.
  So, if we agree that that number is too high and the President, 
himself--and of course, he was a Senator for the last 4 years, and he 
voted for some of these budgets--agrees that a $400 billion deficit is 
too high and he wants to cut it in half, then you would think that 
means he is going to have a $200 billion deficit, but that is not what 
is happening in his budget.
  He actually proposes in his very first year a $1.7 trillion deficit, 
triple the budget deficit that he ``inherited.'' By his fourth year, he 
is still over $1 trillion now in deficits. So, clearly, he is not 
cutting it in half. He has raised the bar the first year to a record-
level-high deficit, and still his fourth year is more than double the 
deficit that he inherited in the first year.
  Mr. AKIN. Reclaiming my time, that is really clever politically. So, 
in other words, what you're saying is the first year, you kick it up--
and it is whatever it is, three or four times more than it has ever 
been for a long, long time--and then you say, ``But I am going to cut 
it back so it's just a lot more than it has ever been.''
  Mr. SCALISE. I'll give my friend from Missouri an example. I come 
from Louisiana. I was born in New Orleans. We've got some of the best 
restaurants in the world in New Orleans, and that is an undisputed 
fact, and I'm very proud of that fact, but if I were to decide tomorrow 
to go out every single night and eat at these world-class restaurants 
and, let's say, starting tomorrow and for a couple of days that I 
gained about 40 pounds while eating out and I say I'm going to cut my 
weight gain in half, after a couple of weeks, I'm down to a 20-pound 
increase. Well, at that point, I'm still 20 pounds heavier than when I 
started.

                              {time}  1845

  And so what happens is he starts off by raising, by actually going 
on, instead of an eating binge where you can get some good enjoyment 
out of the food, he goes on a spending binge spending money that we 
don't have, that our children and grandchildren who, I am sure, would 
not approve of this. And, of course, I have got a 2-year-old daughter. 
Nobody's asked her if she approves of this spending because she is 
going to have to pay for it. And yet they go on this spending binge in 
the first year and continue it all the way out through the full 4-year 
term of President Obama.
  In fact, the Congressional Budget Office has estimated that in the 
first 5\1/2\ years since President Obama took the oath of office, the 
national debt will double in those 5 years--double from the point that 
this country started, going back to George Washington through President 
Bush, all the debt that has been inherited in our country for that 
entire period of time, over 230 years, President Obama, in just 5\1/2\ 
years, will double that record level of debt.
  Mr. AKIN. Reclaiming my time.
  We have a chart here. It is kind of an interesting chart in a way in 
that these are all of our Presidents. You start over here with George 
Washington and you end up down here with President Bush. And if you add 
all of the debt that all of these Presidents all the way through Bush 
put together every time when they overspent the family budget, if you 
will, and you keep adding all of that together, you come up with $5.8 
trillion, which is bad. We shouldn't overspend that way.
  But here, take a look at just from 2009 to 2016. That's not so many 
years. We're only talking about, what is that, 7 years. That's 
assuming, let's say he were President for 8 years and so this is all 
during his Presidency. What he's proposing is $8.7 trillion. So he's 
going to create more debt in 7 years than we have in 232 years of all 
the previous Presidents. This is kind of getting serious.
  I have noticed that we're joined in the Chamber here by a judge. You 
know, judges are kind of sober and straightforward. And this guy is a 
judge from Texas, and Judge Carter usually has some very interesting 
perspectives and a little bit of straight shooting and straight talk.
  Judge Carter, please join us.
  Mr. CARTER. I thank the gentleman for yielding.
  Actually I have been listening to what you have got to say, and I 
think it is a really interesting concept, but it is not one we haven't 
seen before.
  When I first came to this Congress when the Republicans were in the 
majority, I happened to be on the Education and Workforce Committee, 
and No Child Left Behind, everybody was screaming they would need more 
money. I don't remember the funding numbers, but they were something 
like $8 billion. So we decided we would accelerate that to $10 billion 
because it was needed.
  The minority offered an amendment to make it $15 billion and then put 
out a press release that said, ``Republicans cut No Child Left Behind 
$5 billion.'' And they never changed it. And I kept saying, Wait a 
minute. That's not right. We raised it $2 billion.
  But from their proposal--which is the right proposal--if you look at 
this over here, I mean, it is pretty obvious in those out-years, that 
line is half as big as this big line. It is actually less than half as 
big, if you look at this. Nobody is lying right here. I cut this line 
more than half. Of course, it exceeds this line and far exceeds this 
line and far exceeds this line.
  So to say before you propose a budget, you're going to cut the 
spending in half, and then you say but first I am going to jack it up 
2\1/2\ times and I am going to raise it down to this level. Nobody is 
telling a story. It's half this.
  But this is the record of all-time spending in the history of the 
Republic.
  It is not half of this, which is the Democratic Congress with Bush, 
or half of this, the Republican Congress with Bush. But it's half of 
this, which is President Obama with a Democrat Congress. I think that's 
an interesting concept.
  Mr. AKIN. We've heard about how bad Republicans and President Bush 
were, so I just made a couple of real simple comparisons.
  This is the average annual deficit under President Bush, and it was 
$300 billion. Now we don't like that. But that was what the deficit was 
on an average under the Bush years--$300 billion.
  Now under Barack Obama's proposed budget--these are his numbers; 
we're not doctoring them--this is what he's proposing. His annual 
deficit is going to be 600. He's doubled the deficit of President Bush. 
And we heard all of this stuff about how bad Bush's spending level is. 
Here is another way of saying it.
  The highest deficit under George Bush happened to be 2008, and that, 
of

[[Page 8769]]

course, was with the Democrat Congress, but that was $459 billion, and 
the projections by the Congressional Budget Office is looking at $1.2 
trillion. That's more than double.
  And here we got the increase in national debt. Under Bush, he 
increased the debt, from 2000 to 2008, $2.5 trillion. But take a look 
under Barack Obama, we're looking at almost double.
  So everywhere down the line we're doubling. And we are not fighting 
the war in Iraq, and we're pulling the war in Iraq back, and we're, in 
fact, doubling everything.
  So these numbers really need some attention, I think, and I 
appreciate your sharing.
  I would yield to the gentleman from Louisiana.
  Mr. SCALISE. As we look at all of these numbers--and, of course, it 
can become overwhelming. It looks like something that's almost hard to 
believe when you look at these record levels. But I think all across 
the country what you're seeing is people really are looking at this 
level of spending, and it is something that people don't want to 
stomach. It's something that they don't feel comfortable with. They 
realize how reckless this level of spending is.
  In fact, all across the country right now we're starting to see TEA 
parties sprouting up. These are things that aren't being even 
organized. There was one I heard of in Orlando, Florida, the other day. 
Two housewives got very angry. They got mad. They wanted to channel all 
their anger that's been going on in Washington and all of the borrowing 
from our children and grandchildren, and they decided they were just 
going to put together a protest against all of this spending. Over 
3,000 people showed up at this rally. In my district on April 15 in the 
largest parish in Louisiana they are planning a TEA party.
  They are also planning another one in a place called St. Tammany 
because people are angry about the spending. They want to stop this 
because the good news is--and as we have been talking about all of this 
there is a silver lining--and the silver lining is this budget has not 
passed yet. This budget has been proposed by President Obama, but I 
think as he's laid it out there, not just Republicans but Democrats, 
Independents all across the country are speaking up just like we are 
here tonight on the House floor. People all across the country are 
speaking up saying, Enough is enough. Stop this runaway spending. And I 
think that's encouraging because there is an opportunity to slow this 
train down to regain fiscal responsibility.
  Mr. AKIN. You talked about the TEA party. We were flushing a little 
tea down the Mississippi River from St. Louis. We had a TEA party, too, 
and I don't know whether that's gotten down to Louisiana yet. But we 
had the same thing. We have people saying, Wait a minute. This spending 
is out of control. Some of the money that we had on the chart here has 
already been spent. But there is a tremendous amount more spending that 
is being proposed. And we don't have to keep spending.
  We did the $300-some billion bank bailout. That water is over the dam 
or down the river, however you want to look at it. And that porkulus 
bill at almost $800 billion, you know, you're talking about more than 
the war in Iraq and Afghanistan added together. We're talking about 
just 5 weeks here in the Chamber, and we have gone hugely into debt.
  I am on Armed Services. One of the most expensive things we buy on my 
committee is aircraft carriers. We have 11 of them in the U.S.A., and 
this bill, for $800 billion, we could get 250 aircraft carriers. End-
to-end I can't even imagine how many aircraft carriers that would be. 
We only have 11. The debt service and the money would buy 9 brand new 
aircraft carriers. We're talking a lot of money, and the American 
public is starting to get wise to this deal.
  Mr. CARTER. I was thinking as you all were talking, these numbers 
will glaze over the eyes of almost anybody listening to them because 
there is such a tremendous amount of money that people just kind of go, 
whoa, this is more than I can think about. And I think that could 
happen.
  There's been several examples that have been coming out. Recently I 
saw one in either Roll Call or The Hill, just the day before yesterday, 
where they were talking about if you spent a dollar a second, that 
32,000 years from now you would have spent $1 trillion.
  Mr. AKIN. Thirty-two thousand years? Now, wait a minute. What year is 
this? This is 2009 and you're saying 32,000?
  Mr. CARTER. Yes. Thirty-two thousand years from now you'd spend $1 
trillion.
  Mr. AKIN. This isn't the year of 32,000. This is the year 2009.
  Mr. CARTER. It's a number that shakes the imagination.
  But there is more in this budget that we ought to be talking about 
that I think and I want to suggest, do you have information about this 
carbon tax?
  Mr. AKIN. Oh, yeah.
  Mr. CARTER. Let's talk about the carbon tax because I think that's 
something that people can relate to.
  Mr. AKIN. Reclaiming my time.
  The special hour that the Democrats did just before we came on here, 
they were talking about the glories and the benefits of this carbon tax 
and all the things they're doing with renewables and those kinds of 
things. But a tax is a tax is a tax.
  What we're talking about here is this thing that's called cap-and-
trade. I would call it cap-and-tax. This is $646 billion. This is 
another one of these things you have got to be real careful what you 
hear when you get an address from the President. Because as he was in 
this Chamber 6 or 8 weeks ago, he gave us a State of the Union or State 
of the State, whatever the address was called, he said, Look. I am 
going to guarantee you something. If you're making less than $250,000, 
I have got good news for you. I am not going to tax you.
  He said that. We were sitting in here. And then he's proposing this 
cap-and-trade which really is a tax on the use of energy, particularly 
carbon.
  And who is it that uses this carbon? Well, anybody who's got a house 
that's heated with fuel oil or coal or electricity or natural gas. All 
of those things are going to get taxed.
  So this little tax, this $646 billion tax, is going to come from 
somebody. Guess who? The average homeowner. In fact, it has been 
estimated by one organization that you're talking about $3,100 per 
average household. That's some money for a lot of us.
  Mr. CARTER. If you look at that, divide that $3,100 by 12, it's, 
what--I am not a mathematician--about $300.
  Mr. AKIN. Three hundred dollars a month.
  Mr. CARTER. A $300-a-month increase in your fuel bill.
  Now, the way to remember all of this, when you think of this national 
energy tax that they are proposing, is from now until we get through 
with this debate, every time you turn off a light or turn on a light, 
realize that you have increased out of your pocket probably 50 cents. 
Every time you turn one on and maybe if you turn it off you're saving 
50 cents.
  But the bottom line is about $300 a month, next month, if this tax 
were to go into effect, would be coming out of your pocket. Okay. It 
wouldn't be something you did. And the real issue is more important 
because let me point out, and I pointed this out the other night.
  Everything in this room was brought to you by a truck, including the 
clothes on your back and the food that you ate for lunch. And that 
truck ran on diesel, and diesel is going to be taxed. Therefore, that 
tax is going to be passed on to who? The consumer.
  So everything in here is going to go up by a percentage.
  Mr. AKIN. If you buy a chair or a table or a microphone, anything 
that you see sitting around us, you're going to move that by rail.
  Mr. CARTER. Or the wood or the plumbing or the cement or the carpet 
or the clothing or the food you eat.
  Mr. AKIN. There is energy tied up in everything. And it's all going 
up.
  Mr. CARTER. Just the transportation costs are going to go up.
  People need to realize if it's raising your heating bill and air-
conditioning

[[Page 8770]]

bill $300 a month, then some percent of everything else you're going to 
have is going up in value and cost.
  Mr. AKIN. Reclaiming my time.
  I don't want you to make things too gloomy here. We're not just 
talking about gasoline and natural gas and propane and electricity.
  Mr. CARTER. And coal.
  Mr. AKIN. We're talking about the price of all of the things that 
that energy goes into as well.

                              {time}  1900

  That would affect small businesses, too. I yield to my good friend 
from Louisiana and I know that you have had some small business 
experience. Maybe you can share your thoughts about does this make 
sense for us to be doing this great big tax increase on energy when the 
economy is struggling? Does that make sense to you? I yield.
  Mr. SCALISE. It absolutely does not make sense to be doing this in 
good times or in bad, but especially when we talk about the economic 
times our country's facing, where unemployment is going up and just 
exceeded 8 percent nationally.
  The estimates that are just starting to come out on the President's 
cap-and-trade--and he calls it a cap-and-trade bill, but clearly, this 
is an energy tax, a tax on energy to the tune, according to the 
President's budget, and this is not our number. This is the numbers 
that the President gave us. He expects to generate over $640 billion in 
new revenue through this energy tax, and this is something that's going 
to be paid for by every American family.
  His budget director, Peter Orszag, a year ago when he was working for 
the Congressional Budget Office actually said this type of plan, this 
cap-and-trade energy tax, would cost every American family that uses 
energy roughly $1,200 a month minimum more in their electricity bill. 
Plus, anything that is produced by energy, any product that's produced 
by energy, would also increase in cost because this tax would be passed 
on.
  And so, as the judge said, these goods, food, clothes, anything 
that's shipped by rail, by car, by truck, by ship, all of these goods 
will be taxed through this energy tax, the cost being passed on to the 
consumer.
  What's more, early estimates in the first year alone, numbers we got 
from the U.S. Chamber of Commerce, showed that we would lose, the 
United States, would lose over 600,000 jobs that would leave this 
country. And we talk about the dangers of exporting jobs, losing jobs 
to foreign countries. Countries like China and India are not be going 
to be complying with this tax.
  I will give you an example of a business, an opportunity, that is 
delayed right now, a job-creating opportunity in a time when we want to 
be creating jobs. In south Louisiana, there is a steel mill that a 
company from North Carolina was going to be building, and they're right 
now deciding between two sites. One site's in the United States, and 
it's in south Louisiana right outside of my district, but it's in south 
Louisiana. The other alternative location is in Brazil. So they're not 
even looking in the United States if they don't go to this location.
  Mr. AKIN. Reclaiming my time a second, what you are saying is you've 
got some very hard manufacturing jobs. These are the kind that support 
other jobs in the community. You're talking about steel mill. You're 
talking about production. You're talking about a lot of investment, 
good solid jobs in the community, and your competition is not Missouri, 
is it?
  Mr. SCALISE. The competition is not Missouri. In fact, the only 
competition is really the United States Congress is because what this 
company has said is they want to build this plant in the United States. 
They want to keep these jobs in the United States. This is a $2 billion 
investment, and we're not talking about government money. We're not 
talking about bailouts. It seems like some people in the White House 
and the leadership in Congress, they only want to give taxpayer money 
away to people to create jobs.
  This is a private company that wants to spend $2 billion of their own 
money to build this steel plant which would create 700 good, high-
paying jobs, and they want to do that here in United States. And they 
said there's one thing holding them back, and that's the President cap-
and-trade plan. If the President's cap-and-trade plan, the energy tax, 
passes, they will not be able to build that plant in the United States.
  Now, that plant will still be built. So people that think that this 
plant's going to do some damage to the environment, first of all, they 
don't have science backing them up on that. But if they think that, 
first of all, they're wrong because that plant will be built, but it's 
going to be built in Brazil. Those 700 good, high-paying jobs, the $2 
billion of private sector investment will all be sent to Brazil. And 
Brazil's not going to use the same environmental controls, the same 
safeguards that we would use if that plant was run here.
  So that's a real direct example, and that's one example. That's one 
of countless examples of what the President's cap-and-trade energy tax 
would do, not only to raise taxes on every American family, as even his 
own budget director pointed out, but also the direct loss in American 
jobs that would be shipped overseas if this plan passed. And this isn't 
something that we're just coming up with. This is something a 
corporation has said publicly that they want to spend $2 billion to 
create 700 jobs here in America.
  Mr. AKIN. Reclaiming my time, these are hard jobs. This is a proposal 
by a company. I used to be in charge of maintenance in a steel mill. I 
didn't know if you knew that, but I did. In fact, my great-grandfather 
started a steel mill. I can tell you one thing about steel mills, they 
use energy. They use a lot of energy. If you're going to put this big, 
whopping tax increase on energy, guess what you're going to do. You're 
going to do the same thing that's going on here. You are sending jobs 
straight out of our country, and that's not what we should be doing in 
these economic times. It makes no common sense whatsoever.
  Mr. CARTER. If the gentleman would yield for just a moment, in the 
Washington Post a couple of weeks ago, I saw an article about Germany, 
and Germany has had a cap-and-tax procedure over there now for 5 years. 
I believe that's what the article said.
  Mr. AKIN. And how well is it working?
  Mr. CARTER. Well, according to the scientists, they actually are 
putting more carbon in the air and in the atmosphere since they put the 
cap-and-trade proceedings in because those companies that were dirty 
could just pay the tax and continue to be dirty. If you have got a 
dirty plant that's putting carbon dioxide, if it's bad, into the 
atmosphere and they say, well, fine, how much is the tax, here's the 
tax, I will pass it on to my customers down here that are buying my 
product, does that keep this stuff from going into the air? No. It's 
still there in the air.
  Mr. AKIN. Reclaiming my time, what you're talking about, we see this 
when you really look at legislation we pass all the time, we pass 
legislation that's supposed to do one thing, and frequently it does the 
exact opposite. You know what I'm thinking, if I'm from the good old 
State of Missouri, we have plenty of guys. There's a lot of oak trees 
and a lot of chain saws, and you all of the sudden start taxing 
people's natural gas or their propane or if they have electric heat 
pumps and things and their family budget gets tight, guess what's going 
to happen. That old, dead oak tree out behind in the back 40, they're 
going to get that chain saw, they're going to fire that thing up, and 
they're going to get themselves a big, old, wood burning stove. And it 
may not be very efficient, and they're going to really put some 
CO2 out.
  And the thing that is supposed to be not making CO2, 
instead of building a nuclear plant that makes no CO2, which 
is if you were really serious that you're worried about CO2, 
well, then you'd want to go with a nuclear because it makes no 
CO2. But by doing this tax, all that's going to happen, 
we're going to make more CO2. It doesn't even make a whole 
lot of sense, does it?
  Mr. CARTER. It doesn't make sense. And the other thing is, at least 
some

[[Page 8771]]

people who are very zealous on this theory say we're going to tax 
everything that produces carbon, and my thoughts were, we've been 
sitting here breathing now for 30 minutes, and every time we breathe 
out, we breathe out carbon. So are we going to have a little monitor 
that sits right here that monitors how much carbon we breathe as we go 
through the day?
  It's ridiculous to talk about taxing something like that if it's not 
preventing the situation. You're right, nuclear is a major solution to 
big power. I'm all for alternative vehicles, and they will be a 
solution at some time that will help a lot and let's do it. But we 
don't have an electrical engine big enough to pull a big load down the 
highway unless it's a ship engine which is as big as this room.
  So we've got to be practical about this stuff and say, all energy 
sources, let's clean them up, make them as good as we can, but let's 
continue to thrive by being the most productive place on the face of 
the globe.
  Mr. AKIN. Just reclaiming my time, you know, the thing I'd like--
we're going to be wrapping things up here pretty soon, and one of the 
things sometimes that there's some that would like to portray us as 
being just say ``no'' on everything. I think we need to deal with that 
for just a minute in our discussion here.
  It's not that we think ``no'' on everything. We really think ``yes'' 
on everything, on a whole lot of things. We just don't believe that the 
solution to the economic problems that have been created by these bad 
loans and bad mortgages and things, which were a failed socialist 
policy, there was no failure of free enterprise. We don't think the 
solution to the economy is just spending tons and tons of money. And so 
that doesn't make us just ``no.''
  There are ways to get an economy that's in a recession getting it 
going, and we've seen examples of people that have done it. Why don't 
we copy what works? JFK did it, Ronald Reagan did it, and Bush 2 did it 
in some of the tax cuts. If you do tax cuts and you cut Federal 
spending and you allow small business entrepreneurs, investors to have 
enough liquidity to invest, then you can get the economy going.
  And so we've got a bunch of different kinds of solutions, but the 
bottom line is you've got to back off on the Federal Government sucking 
all of the liquidity out of the economy, and you have got to allow 
small businesses to invest. And you don't do that by taxing them to 
death, taxing them on their energy, taxing anybody who makes over 
$250,000. That's more than half of the small business owners in the 
country.
  And so we've got a solution, don't we? It's not like we're saying 
``no.'' Our solution is straightforward. You have to allow the 
investors and the small businesspeople to have enough liquidity to get 
the free enterprise system going and you've got to get the government 
in this incredible overspending off of their backs.
  I wanted to make sure we're talking positively because we love 
America. This country has been through a lot of crises, and we're in a 
whale of a crisis now because of mismanagement. That doesn't mean we 
have to keep going down the same, dumb path that didn't work for FDR. 
It didn't work for the Japanese. We need to go for the things that 
work.
  So what we are saying is we're opposed to stuff that doesn't work. We 
love our country, and we know how to make it better.
  Mr. CARTER. If the gentleman yield, here's not a ``no'' issue on the 
CO2 but an opportunity. We right now know that we can 
recapture oil in played out oil fields by charging those oil fields 
with, guess what, CO2. So there's an industry out there for 
capturing CO2 and charging oil fields with it. Louisiana 
knows about it, Texas knows about it, and so does the rest of the 
world.
  That means if you put together a plant that captures the 
CO2, rather than paying a tax so you release it in the 
atmosphere, and then you take it and put it in trucks and take it down 
there and put it in the oil fields, you actually produce more of the 
oil and gas energy that's in the ground, and the CO2 is in 
the ground. That will actually keep CO2 out of the 
environment.
  Mr. AKIN. That seems like a whole lot better idea than taxing 
everybody that uses any form of energy and adding that to the price of 
everything else. That's just brutal in a rough economy. There's a lot 
of families in my district that are hurting, and to be doing this kind 
of budget imbalance, take a look at this, these are President after 
President after President, you can see, you know, this is the wrong 
track. This is just not the way to do something. The gentleman from 
Louisiana.
  Mr. SCALISE. There are a lot of things that we are saying ``yes'' to. 
We are saying ``yes'' to fiscal responsibility. We're saying ``yes'' to 
lower taxes. I think people all across the country are saying ``yes'' 
to that, too, and that's why they're all pointing to Washington, and 
they're saying, ``no,'' don't continue going down this road of runaway 
spending, runaway deficit, runaway borrowing from our children and 
grandchildren.
  We can pursue new technologies, as the judge talked about. There are 
companies right now pursuing technologies for carbon capture and 
sequestration where they literally would be going into those coal 
plants and capturing the carbon and storing it, holding on to it so it 
doesn't go into the air. We're pursuing and continuing to encourage the 
development of wind power, of nuclear power, of solar power, but all of 
those technologies combined are what it's going to take to reduce our 
dependence on foreign oil.
  If that's our goal, and it should be our goal to increase our 
production of our own natural resources in this country, but what we've 
got to be very careful about as we discuss the dangers of this spending 
proposal and these taxes is what it does to future generations.
  And there's one final chart I wanted to show, and that is what 
President Obama's budget does to raid the Social Security trust fund. 
This is a promise that was made not only to our senior citizens of 
today but to our workers of today and our children of tomorrow if they 
want to expect that Social Security program to be there for them, that 
they're paying into right now.
  The fact, President Obama's budget in the first four years takes over 
$200 billion a year out of the Social Security trust fund. It actually 
raids those funds after the first four years of President Obama's term 
in office. He would raid over $900 billion from the Social Security 
trust fund alone, and then, of course, he still goes other places. He 
tries to sell debts to countries like China.
  We just saw today--today, something very frightening happened. The 
markets reacted very negatively to it. They went out and tried to sell 
debt, as the country does throughout the course of each week. A few 
times a week the country goes and actually sells debt.

                              {time}  1915

  When they went today to sell debt, the number of people that wanted 
to buy that debt dropped to a low level--dangerously low level--and in 
fact they had to pull back. And you saw the markets drop dramatically 
because I think it is a sign. It's a sign that people are very 
concerned about these runaway deficits and what this is going to do to 
the value of the dollar down the road. And that's why we've got to be 
fiscally responsible. We've got to say ``yes'' to fiscal responsibility 
and stop this out-of-control spending that is going on in Washington.
  Mr. AKIN. I guess you could say we are spending too much, we are 
taxing too much, we are borrowing too much. That is kind of a summary 
of it.
  If you just take a look at these bar charts about the budget 
imbalance, you can see that. This is not the equation of how to fix an 
economy that's in trouble. That's not what JFK did. That's not what 
Ronald Reagan did. That's not what Bush II did to stop those 
recessions. This is even worse than what FDR did.
  The problem we have is if something doesn't work, it just doesn't 
work. It's not like you're being negative. You're saying, Look, it's 
never worked in history. What we have to do is go back to the time-
tested principles of the country we love--and that's just to trust

[[Page 8772]]

the Americans, the inventors and the investors, the entrepreneurs, the 
people who love this country, who live the American Dream, who come 
here with some crazy new idea, give it a try and, by golly, the thing 
works.
  They wake up some day and they've been sleeping under a park bench 10 
years before and some guy and his wife realize they're millionaires and 
they didn't even know it was going to happen to them. That's what this 
country is all about.
  The government can never create any wealth but, boy, we can sure keep 
other people from ever doing any by overtaxing them.
  Mr. CARTER. I'm glad you made that point. What makes America great is 
the giving of the opportunity to succeed. The parents right now that 
are sending their children off to college and times are tight. Now 
they're not throwing money out the window for other projects. They're 
not going out and buying five flat screen TVs as a good idea to make 
things better for themselves. No. They're saving that money. They're 
cutting those costs. They're not eating out every night. They're doing 
these things so that they can do the projects that they want to do, 
which is send their kids to college.
  That's normal budgeting. What we're doing here, what the President's 
proposing is not commonsense budgeting. It's voodoo economics.
  Mr. AKIN. It strikes me as it may be worse than that. What we're 
doing here, we're killing the American Dream. That is what's going on. 
We're killing the dream for people that wanted to come to this country, 
own their own house, be able to send their kids to get a better 
education than they got before.
  This is a country that is so unlike anything else in the world. We 
are such a special country. We are unique in so many different ways. 
Whenever you see there's a tsunami or hurricane, you see our people out 
there helping. We've been a bastion of freedom for people all around 
the world. They look at America and say, Hey those Americans have got 
it down. You could live the American Dream over there. They come 
flooding into our country. We're worried about the immigration because 
they understand what this country has always been about. It's never 
been about this kind of stuff--this irresponsible, runaway government 
spending. This is killing the dream that Americans have always come to 
believe in.
  I yield to my friend from Louisiana.
  Mr. SCALISE. Thank you. I see our time has about expired, but I think 
the important note that we're finishing on, and I appreciate your 
passion because there are so many people that are passionate, and 
that's what's great about this country, and we can stop this runaway 
train by continuing to have this debate tonight.
  Mr. AKIN. This is taxing too much, spending too much, and borrowing 
too much.

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