[Congressional Record (Bound Edition), Volume 156 (2010), Part 1]
[House]
[Pages 1144-1151]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   THE FEDERAL BUDGET AND THE ECONOMY

  The SPEAKER pro tempore. 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, our topic this evening, and one that I think 
has received some coverage in the media, and is something that is of 
concern to many Americans, is the level of spending in the Federal 
Government, the budget that has been proposed, the size of deficits, 
and overall where the American economy stands. These are all very 
important topics. These topics could not be more timely.
  The President has just released his new budget for the next couple of 
years. We can take a look and see exactly what the numbers are. So 
these questions, probably even more so because of the high level of 
unemployment, have a quite a number of Americans asking some very 
serious questions and have, I would say quite honestly, a number of 
people in elected office here in Washington, D.C., extremely concerned 
about the fact that we are not doing what we should do in terms of 
fiscal responsibility.
  Now, one of the things that happens in the political world, and this 
may be a surprise to some people, but perhaps not to others, and that 
is that sometimes there is a significant gap between what people say 
and what they do. And so I prepared a few charts here just to give us 
an introduction to this subject about the budget, about spending, and 
about what is really true and what is really a significant factor, and 
what are more peripheral kinds of questions or issues.
  Now, the first statement was made by the President, President Obama, 
in his State of the Union address here in this chamber not very many 
days ago. This was his comment. He said, ``The true engine of job 
creation in this country will always be America's businesses, but 
government can create the conditions necessary for businesses to expand 
and hire new workers.'' Now, this particular statement is quite true. 
In fact, it corrects an extreme misconception that some in government 
would love to have passed onto the Americans, but in fact is not true. 
And that is that government never can create jobs.
  Well, you say, Congressman Akin, how is it that the government can't 
create jobs? Can't they take taxpayers' money, go out and hire 
somebody, and if they hire somebody doesn't that person have a job? 
Well, the answer is yes, but really no. What happens is when the 
government hires one person various economists would disagree a little 
bit on the exact number, but you take about 2 or 2.3 jobs out of the 
private sector for every job that you create in the public sector. So 
the government really doesn't create jobs, it simply takes money away 
from other people to hire someone. So when you say that the government 
is going to create jobs, that is actually economically false.
  What the President says here is true, ``The true engine of job 
creation in this country will always be America's businesses.'' That is 
true. In fact, he went

[[Page 1145]]

on to acknowledge that it is not just any business, but it particularly 
is small businesses. Someone has figured the statistic that 80 percent 
of American jobs are in companies that have 500 employees or less. So 
small business, that is 500 employees or less, is very much the place 
where jobs are created.
  Now, we have some people in politics that are always blasting those 
rich guys, those people that own businesses. And we are going to tax 
the rich guy and make sure that he pays for everything. Well, there is 
only one little problem with that theory. And that is that a lot of the 
people that own those small businesses are reasonably well to do 
because they have successfully put a business together, have managed 
it, have taken considerable risks, have spent a whole lot of sleepless 
nights worrying about balancing the books, but somehow, in spite of all 
of that, they were successful. And they wake up 10 years later, after 
they created a small business, and they find out that they are a 
millionaire. Now, they may have started sleeping under a park bench 
somewhere, and a husband and wife look at each other, and there is a 
smile, and they look and they realize that their dream has come true.

                              {time}  1845

  The American Dream worked for the owner of some small businesses. And 
what that means is, because those people do have money, they can 
reinvest that money in their own business. And when they do, they'll 
add a wing on the building, add some new machine tools or a new process 
or new idea, and create jobs in America.
  So what the President is saying is true--the true engine of job 
creation in this country will always be America's businesses. But 
government can create the conditions necessary for businesses to expand 
and to hire new workers. The government can do that. Maybe it would be 
more accurate to say that unless the government gets in the way, that's 
the natural cause of small businesses, to grow and to add additional 
jobs.
  What are the kinds of things that the government can do to try to 
create those jobs? Well, they want to create an environment. It's a 
little bit like if you're trying to grow a plant, what do you want for 
a plant to grow? Well, you've got to have some water, you've got to 
have some sunshine, you've got to have the right temperature. You've 
got to have the soil conditions and chemistry more or less right. In 
the same way you can grow jobs in America if you keep certain basic 
factors and functions in perspective. We're going to go into that in a 
minute. But let's take a look.
  This statement being true--these are the words, but here in fact are 
the actions of what is being proposed as you go further into the 
speech. First of all, what is being proposed are $2 trillion in tax 
increases over 10 years; $2 trillion in tax increases. We're going to 
talk about that in a minute, because who's going to pay those $2 
trillion? Where's that money going to come from? You bet, it's going to 
be taxpayers.
  And then we have this job-killing cap-and-tax legislation. My chart 
says cap-and-trade. People want to call it cap-and-trade. They really 
want to call it the global warming tax. But this cap-and-tax 
legislation puts a big tax on energy. Now guess who uses energy, aside 
from homeowners, aside from people who drive cars. Of course, small 
businesses. They use energy. Depending on the type of small business, 
some use a great deal of energy. And so you have here a proposal which 
is about an even portion of government redtape and government taxation. 
If I had to judge the bill, I think the redtape may be more onerous 
than the taxation, which is bad enough. The combination of the two are 
deadly to small businesses and deadly to job creation. We'll get into 
that in a minute.
  What else is being suggested? We're going to have new taxes on 
employers who don't offer the government health insurance plan. So now 
what we're going to say to people if you're a businessman, Yeah, we're 
going to tax you on your energy, but we've got another tax, too, for 
you. That is, we're going to tax you on health insurance. And, guess 
what? You're going to pick up a big piece of the tab for this 
government-run health insurance plan, which supposedly only costs $1 
trillion.
  Now that's not talking about the amount of cost shifting that's going 
to go to various State governments. But you have an extremely expensive 
proposal for government to take over one-fifth of the U.S. economy with 
this mandated, top down--I think I remember 400 or 500 times in this 
3,000-page bill you have the ``shall.'' The government shall do this, 
shall do that. And so this is another proposal which the President says 
he wants to move forward with. And then it increases taxes on small 
business owners who make over $250,000. Well, a whole lot of small 
business owners can make over $250,000. But, again, as I have 
mentioned, if you put the taxes on these people, they'll pay their 
taxes but they're not going to put that money, that tax money, back 
into their business to create jobs.
  And so what we have here is the words that recognize that businesses 
create the jobs, and particularly small businesses create the jobs, but 
then in terms of action what we're doing is we're doing the very worst 
possible thing that you can do in terms of creating jobs and helping 
our economy. Let's take a look. You know, economics can be pretty 
boring sometimes. I try to make it as simple as I can.
  I'd like to talk to you this evening a little bit about job killers. 
If you want to kill a plant, you don't give it any water. If you want 
to kill a plant, you let it freeze. There's certain things you can do 
that makes it so that a plant dies. If you want to kill jobs, there's 
certain things you can do to kill them and there's also things you can 
to create them.
  Let's talk about the first factor. It wouldn't surprise you perhaps 
that the one that I would think of first is taxes. Now how does 
taxation affect small business people? Well, it's this way. If you tax 
them more and more, they're going to have less money to put into their 
business and so they're going to have less money to hire people. And 
that's the same effect I was talking about. The government can tax and 
hire somebody, but when they do, they're taking that money away from 
the small business. And so while you add some government worker, you 
lose two employees from the local company.
  And so tax increases are absolutely deadly, and they are going to be 
a big factor in unemployment. No big surprise. Other people have 
recognized this. This is not that complicated. This is not rocket 
science. This is not laser science. This is not quantum mechanics. It's 
simple lemonade stand-type economics. And other Presidents have 
recognized the problem. And so what did they do when they got into a 
recession and they're having trouble with unemployment? Well, JFK 
understood. He cut taxes. Ronald Reagan understood it. He cut taxes. 
And George Bush during the recession also cut taxes. In each of those 
situations the economy responded fairly rapidly to those tax cuts. And 
why? Because the small businessman is starting to get some money to 
plow into his business. So, first of all, taxes are a major factor. And 
if you raise taxes a lot, you're going to kill jobs.
  What have we just got over here? We've got $2 trillion in tax 
increases. We've got the cap-and-tax bill, the thing on taxing energy 
with all sorts of redtape in it. We also have the employers--the 
socialized medicine bill. Where the government to a large degree takes 
over health care, a trillion-dollar tag on that has to be picked up by 
a lot of small business people. And then you have, if that's not 
enough, increases on anybody making over $250,000. That hammers small 
business people. And this list doesn't even mention the fact that the 
tax cuts on capital gains, dividends, and death taxes, which were put 
in place during the beginning of the last recession under Bush to help 
the economy, those are going to expire. So they're going to compound 
this problem. So here we have words. We understand that jobs are 
created in businesses, but we don't really understand because our 
actions are saying we're going to do just exactly what it takes in 
terms of tax policy to kill jobs.

[[Page 1146]]

  The second factor if you want to kill jobs is redtape. Redtape means 
that it's more cost for businesses to do their work. If the government 
says, Yeah, but you've got to write a report; you've got to do this; to 
check with this; got to go to court to take care of this; you better do 
that; all of that red tape may not be a direct tax, but the net effect 
is it's costing a whole lot of time for an employer to try to comply 
with government redtape. Do you think we've got a fair amount of 
redtape in America?
  Think about the amount the average citizen has in their own life and 
then multiply that significantly for the average business. And so 
redtape is another big factor. We have words. This sounds good and in 
fact this is even true. The trouble is the actions are the exact 
opposite.
  I recognize that I've been joined by a good friend of mine, 
Congressman Bishop, and I'd like to yield you some time if you'd like 
to talk a little bit about the budget. I'd like to get into tonight a 
couple of different things that have been said, comments that have been 
made about this budget. First of all, I want to get a scale of how big 
it is. Second of all, I'd like to talk a little bit about can you blame 
it on the previous administration. We keep hearing that it was 
President Bush's fault that we're in the economic problems. And then 
I'd like to get back to the job creation question. But I think you've 
got some specific examples from your district where there were jobs 
that we're talking about, and particularly an employer that is affected 
by this budget. Could you share with us, please?
  Mr. BISHOP of Utah. Well, I thank the gentleman from Missouri for 
yielding. Yes, this presents a particularly interesting conundrum that 
we do have here. The President has talked about how our most important 
element is to create jobs. And it is. For our people we need jobs. I 
recognize, though, that much of what we have in this budget that you 
have already mentioned does not create jobs. It actually has a stifling 
impact on jobs.
  Some things, though, in which jobs are our responsibility, we also 
have put a stifling influence just on the decisions we make. This 
budget is $3.8 trillion. That's a whole lot of money. It's $1.6 
trillion more than we have. That's a whole lot of money that's going to 
go there. And in every one of the budgets that takes place it's about 
choices. In our own families we do the same thing. We have certain 
things we want and certain things we need. My problem with this budget 
right now, specifically in the areas that I am deeply concerned, is 
that we have a lot of stuff in here that we want that's being funded 
and a lot of things that we need that is not being funded.
  One of the few constitutional responsibilities we have in this 
country is defense. Last year, you and I were down here with others 
very frequently talking about missile defense. It is essential for this 
country. We cut missile defense. Once again, it was about 
prioritization. I think and I believe you thought we put our priorities 
in the wrong place. And you don't build a missile without people. When 
we cut our missile defense program, we took jobs away.
  Unfortunately, in this particular budget, once again we go after 
another kind of missile program and have decided to take it out. What 
it simply means is this budget decides to go after NASA and take away 
the Constellation program and specifically the Ares 1 rocket. Now I 
hate to say this, but Time magazine determined what were the Fifty Best 
Inventions of the Year. And the number one invention was the Ares 
rocket. This is our process to replace the space shuttle. This is how 
we are moving into space exploration in the future. I hate to say this. 
I think space exploration is one of the core responsibilities of the 
Federal Government.
  But in taking this out what you are doing is cutting 7,000 jobs 
nationwide of people involved in space, engineering, math, and science, 
which--once again, the President wants to encourage kids to study and 
to go into engineering, science, and math, but we don't have any 
responsibility of trying to encourage that on the real side. And where 
the problem comes is the people that make the motors for these rockets 
make the motors for our missiles.
  Mr. AKIN. Let me just get the connect, because you're building up to 
something here. What you're saying is that there are solid rocket 
motors that are being built in America, which are very high-tech, and 
they're being built by a particular company. And they're used for the 
space program but they're also used for something else. Is that 
correct?
  Mr. BISHOP of Utah. In defense.
  Mr. AKIN. In defense. So it's not just space. It's also our defense.
  I yield.
  Mr. BISHOP of Utah. Both of those are core responsibilities of the 
government and one that this administration has decided to cut. And 
it's not necessarily that they are companies that are making these--
there's actually two companies in America that do make those motors; 
one hasn't made any in a couple of decades. But it is people that do 
it. When you cut these programs--when you cut the missile defense last 
year and you cut this rocket program this year, the people with the 
expertise that we need to build the defense of this country are going 
to be gone. They're either going to find another job or, unfortunately, 
they're going to go on unemployment so we can pay them for not doing 
their jobs that we need to defend us.
  This is one of the travesties of this particular budget. And it would 
be okay with me, perhaps, if they had come up with a new plan, a new 
role for NASA, something they are going to move us forward with, but 
they did not. All they did is simply cut the program, throw people out 
of work--if it goes through, I should say. We still have the right to 
say what it is. But this budget would cut the program, throw people out 
of work and, more importantly, fail for us to defend this country, 
which is our constitutional responsibility. It would fail to allow this 
country to move forward in space exploration and in defense because the 
industrial base of this country would be gone.
  The acquisition guys over in the Pentagon understand it. They say 
it's not necessarily about jobs, it's about the kinds of jobs. And 
therefore it is important for the future of this country to have the 
right kinds of jobs in the industrial base. And it's not simply a 
spigot you can turn on when once again we decide, oops, maybe we had 
the wrong idea and we need more missiles to defend us against the 
Iranians and the North Koreans and who knows what else might be out 
there. You can't just pick it up again. If you lose the capability, you 
lose the capability. And, I'm sorry, in this budget we lose the 
capability we need to defend this country.
  It's not just about the amount of money. It's about where we put our 
priorities and do we do what we need to do first and then cover the 
wants. I'm sorry; we're paying a lot of money for a lot of wants. Let 
me give you a simple example. If you took what we spent in the stimulus 
last year for ACORN alone, you could fund this program again and still 
have close to $2 billion left over.

                              {time}  1900

  Mr. AKIN. Wait a minute. You are telling me that the ACORN program, 
the one where we've got people going to jail for voter fraud and all 
other kinds of strange and weird behavior, registering illegals, 
registering people that don't exist, turning them out to vote, and even 
on videotapes, we see them encouraging people to build brothels and to 
bring in underage illegal immigrants, that organization? You are saying 
that funding could be instead directed?
  Mr. BISHOP of Utah. That program got more funding in the stimulus 
bill that was passed last year than it would take to carry on with this 
program moving forward.
  Mr. AKIN. What you have said--and I just want to reinforce. There is 
a difference between jobs and jobs, is what you are saying. Some of 
these things are very high-tech kinds of jobs. They require building 
companies over a good number of years, building capabilities, putting 
that team together, and you've

[[Page 1147]]

got to have enough work to keep that team operating or else they just 
have to dissipate and go somewhere else. And if we need that capability 
for the defense of this Nation, that, in many of our opinions, is the 
primary function that we must perform here. There are a lot of other 
things that might be nice if the Federal Government did it, but if we 
have invading armies riding across our country, we're not very 
effective.
  Mr. BISHOP of Utah. I think you are exactly right, and that's why, 
with all due respect, this is like a double disappointment to me. Not 
only are we spending too much and taxing too much, but we are not 
spending it in the right place.
  Mr. AKIN. We're not even spending it in the right place. You know, 
that's a very, very visible kind of thing. You can see a solid rocket 
voter has a lot of technical kinds of aspects, how those have been 
developed, and we have an advantage on that from a technology point of 
view. Now you are basically saying that we're going to give that up for 
spending it on what, on something like ACORN? That's why a whole lot of 
people out there are really wondering what we're doing down here.
  Congressman, thank you for joining us. I notice that we are joined by 
Dr. Burgess, a good friend of mine. We're talking about the budget and 
about job creation and how those things connect. I also was trying to 
take apart a little bit because we hear some good words, and yet the 
actions of what we're doing don't seem to fit. So if you can join us, 
please.
  Mr. BURGESS. I appreciate the gentleman yielding. When I heard what 
you were doing, I wanted to come down here and talk. You know, a week 
ago we heard from the President here in the House of Representatives, 
and he talked about this recession that he inherited. Okay, it's almost 
as if no President has ever had to deal with a recession before.
  I don't know about you, but 20 years ago, we had a pretty bad 
recession where I lived in north Texas. In fact, I remember it very 
well because--I'm a doctor--the medical group that I was in was under 
such stress from this recession that it splintered apart, broke up. I 
found myself on January 1, 1990, beginning a whole new venture as a 
solo practitioner in obstetrics and gynecology in my town. And quite 
honestly, I wondered how I would make it. The recession was rough. We 
didn't have anyone coming down from Washington with a big bag of dollar 
bills saying, You guys doing all right? You need some more cash? We'll 
be glad to front it to you. At that time, the bad actors were the 
savings and loans that had imploded. But real estate markets had 
fallen, energy prices had fallen, and Texas was certainly upon hard 
times.
  The reason this came to mind was the story recently about the number 
of people in the administration who worked in a private sector job, and 
the number is astonishingly low. It's in the mid-single digits. No 
wonder when this administration looks around for solutions, their 
tendency is not to go to people who have actually done things in the 
past that have been creative and successful and created new jobs.
  In February of 2000, I had ended my first month in this new medical 
venture, and I didn't have any money. I couldn't take any money home 
certainly because I didn't have any money, and I had nurses on my 
payroll that were depending upon me. Their families were depending upon 
me. It was a tough time. It was hard to borrow money. I went down to 
the bank and borrowed $12,000 to meet payroll for that 2-week interval. 
The banker was not kind to me. He charged me 14 percent interest.
  Mr. AKIN. Whoa, whoa, whoa. Stop just a minute. There wasn't somebody 
with bailout money from the Federal Government to come just give you 
some free money?
  Mr. BURGESS. No, my bailout was my friendly banker who said----
  Mr. AKIN. Fourteen percent interest?
  Mr. BURGESS. For a 6-month loan.
  Mr. AKIN. You can say that with a smile on your face today, but that 
banker wasn't too good a friend.
  Mr. BURGESS. It was $12,000 to meet--I realize here that $12,000 
doesn't even calibrate as budget dust with what we do. But $12,000 was 
an enormous sum of money to me at the time. I'm not going to be able to 
take a paycheck home, but I had to be able to pay my employees. No 
money was coming across the counter because I'm an OB/GYN. You've got 
to wait a few months before the delivery occurs, and you get paid for 
the work. I was so scared--
  Mr. AKIN. Sort of one of those 9-month lead time type of things.
  Mr. BURGESS. Correct. I was so scared about what the future held for 
me. I did some mental calculations, and if it cost me $25,000 a month 
just to pay my employees, what is my world going to look like in June? 
I'm borrowing for operational expenses, and I have got no way to really 
catch up that slack. Well, to make a very long story abbreviated, money 
did start coming in over the counter. That was the last money that I 
ever had to borrow.
  But boy, I'll tell you what, when we come down here and we talk about 
this budget, I remember just how I felt those days. How was I going 
home to face my family? No paycheck. You talk about tightening your 
belt, there just wasn't a belt to tighten. We didn't have anything. I 
knew I had to continue to perform for my patients because I was 
obligated to do that. I knew I had to continue to perform for my 
employees because I was obligated to do that. I didn't ask any 
questions. I didn't whine about it. I went down and did what I had to 
do, which was borrow $12,000, and it scared me to death. It scared me 
to death.
  And we're going to borrow $1.9 trillion tomorrow just to meet our 
debt obligations for the next, what, 14 months? Are you kidding me? And 
the problem is, we've got an administration where no one has ever 
worked in the private sector. No one's ever had to go down and borrow 
that money, put their name on the line. No one's ever signed a paycheck 
on the front. All of their paychecks are signed on the back. That's our 
problem. Their natural tendency is to look for the government to get 
bigger because that's where the solutions come from.
  No, the solutions come from the private sector, the small business 
entrepreneur, the doctor, the cardiologist, the saddlemaker, air 
conditioner repairman. That's what has made this country great. That's 
where the recovery of our economy lies, and we are fixing to kill the 
goose that laid the golden egg with this massive debt.
  What's going to happen when we have to monetize $1.9 trillion? What's 
going to happen to the interest rates? I paid 14 percent in February of 
1990. You know what, that might look like a pretty good deal 10 years 
hence when we get to monetizing.
  Mr. AKIN. You know, Dr. Burgess, what you have communicated here, 
aside from being a doctor--we always put doctors sort of in a special 
category and maybe a little bit of an elevated platform. But what you 
have communicated is just the heart of a guy that has a business and 
how much risk you took and how you plowed into unchartered territory, 
just trusting that you could generate that business and then get the 
business going. And afterwards, you had employees. You provided a great 
product for people, and there are a whole lot of Texans who are 
thankful to Dr. Burgess for delivering them. But you gave us an 
understanding of how that whole system works. And just like your one 
example, there are really thousands upon thousands of business owners 
that are looking at this thing, and saying, What in the world is going 
on?
  Now we've talked about words and then actions. Here are some words, 
but families across the country are tightening their belts and making 
tough decisions. The Federal Government should do the same. Hey, that 
sounds pretty good. That's what you were just talking about, Doctor, 
that families have to tighten their belts and take a good look and make 
choices between one thing and another.
  Congressman Bishop just made a brilliant explanation of why the 
Federal Government is making lousy choices. Not only are we spending 
too much, taxing too much, borrowing too much, but we're also doing it 
for the wrong reasons. And that just doesn't make a whole lot of sense.

[[Page 1148]]

  This is starting to get to the point where I think things are going 
to get interesting. We're going to bring on another witness, a 
fantastic young man who really does know something about budgeting. The 
big question I think that comes to a whole lot of Americans' minds is 
this question: When is too much too much? When do we get to the tipping 
point where the whole thing, just like a table, dumps and the whole 
economy just basically falls to pieces? You know, just like in your 
business, if you had borrowed too much, you could have pushed it too 
far. You intuitively knew that.
  What happens when we start getting into this? We're saying that 
families across the country are tightening their belts, but we, sure as 
the dickens, are not because with our actions, we're going to double 
the debt in 5 years, raise the deficit to a record $1.6 trillion this 
year. That's 10.6 percent of GDP.
  Let's put this into perspective. It's one thing to have a deficit 
during a year; but when you compare the deficit to the overall product 
of the whole Nation, that's a significant statistic. And last year, we 
set a record. The year before we set a record. During the time George 
Bush was finishing and Nancy Pelosi had this Congress, we had a $450-
something billion deficit. That was big. That was 3.1 percent of GDP. 
That was too much spending. And then we come back around to '09 and 
what do we do? We go from $4.5 billion--oh, billion isn't a big number 
anymore. Let's try trillion--to $1.4 trillion of deficit. That's three 
times more with the current President, and when you look at it as a 
percent of GDP, 9.9 percent of GDP.
  So now we've learned our lesson, right, for 2010. Certainly that was 
too much. No. No. We're going to go for $1.6 trillion instead of $1.4 
trillion and 10.6 percent of GDP. When is enough enough?
  My good friend Congressman Hensarling, I don't want to pick on Texas 
too much, but you have really taken the lead on a number of these 
economic issues. We need some help tonight, and we need to ask that 
question, When is too much too much? Please help us.
  Mr. HENSARLING. Well, I thank the gentleman for yielding, and I 
certainly appreciate his leadership tonight on an issue that is of 
great concern to every American. Every American who has children, every 
American who has grandchildren and are wondering, What is Washington 
doing drowning them in a sea of red ink? Again, when you say, How much 
is enough, we are already there. So I think it's been somewhat of a 
surreal experience for the American people as of late to see Washington 
go mad.
  Never in the history of our Nation, do I believe, have I seen such an 
explosion of spending of deficits and debt. As a lot of the public 
know, the President of the United States on Friday came and spoke to 
the Republicans in the House, and I give the President credit for doing 
it. I think it speaks well of his character that he would come and 
speak to us, something that our own Speaker I don't believe has ever 
done.
  I had the opportunity to speak to the President at that exchange, and 
I asked our President, I said, Mr. President, your last budget that you 
submitted tripled the national debt over 10 years and took the cost of 
government from its historic level of roughly 20 percent of our economy 
up to 25 percent. I mean, we haven't seen such levels of government 
since World War II, the cost of government relative to the economy. I 
asked the President that question, and the President didn't answer. The 
President declined to answer the question on Friday. But you know what, 
he answered the question on Monday, and he answered the question with 
this document because on Monday, the President submitted his proposed 
budget for the United States of America for the next fiscal year and 
for the 9 years following.
  Guess what we found out in this document? What we found out was that 
the answer to the question is a resounding ``yes.'' President Obama has 
now said to the American people loud and clear, Yes, I will triple the 
national debt over 10 years. I will triple the national debt. Yes, I 
will take the level of government to levels we haven't seen since World 
War II, up to 25 percent of our economy. This is a breathtaking 
document. The levels of debt, the levels of deficit, the levels of 
spending are simply breathtaking. The largest budget in the American 
history, $3.8 trillion.
  Mr. AKIN. I would like to just butt in. I do butt in a few times. And 
before you jump a little bit further, one of the things that the 
President said--because I was at the meeting when you asked the 
question. One of the things that we heard was, Well, you know, I 
inherited a lot of this stuff. It was like saying, It's not my fault 
that I'm spending all of this money.
  And this is hard for me to understand. I'm thinking, Look, you've got 
the previous President. He spent, with the Pelosi Congress, about $450 
billion, which you and I, gentleman, thought was too much. It was too 
much deficit, and we didn't like that. In fact, we vote against a lot 
of that kind of spending. But that is, in a sense, water over the 
bridge or down the river or wherever the water goes. Now he is taking 
that and triples it in his very first year.

                              {time}  1915

  How can you blame the guy that came before you when you were three 
times doing more than he did? Could you explain that, because I don't 
get it. How can you blame that on someone else?
  Mr. HENSARLING. Well, I thank the gentleman for yielding, and it's an 
important point to make. Simply because, as opposed to leading, too 
often, frankly, we see the President, we see the Speaker, we see our 
colleagues on the other side of the aisle saying, Well, the truth is, 
you Republicans spent too much money.
  Well, guess what? I agree. But only Congress, only Congress can spend 
money. Congress has the power of the purse. The only money the 
President can spend are those monies that are authorized by Congress. 
Now, the President can propose. The President may be given pots of 
money by Congress that he can allocate. But, ultimately, it is Congress 
that controls the power of the purse under our Constitution.
  Now, we had 12 years where Republicans controlled Congress, wrote the 
budgets, wrote the spending bills. And I wasn't proud of the deficits 
that occurred in those years, but they averaged about $104 billion a 
year.
  Mr. AKIN. So, gentleman, just taking a look at some notes I had, this 
would be about from 1996 to the year 2007, and you total that up at 
about $1.2 trillion. So that's 12 years of Republican deficit spending, 
more or less.
  Mr. HENSARLING. Well, if the gentleman would yield, I think the most 
important point here--and we shouldn't spend, obviously, a lot of time 
on the blame game. The American people want solutions. But what we 
typically hear from our friends on the other side who aren't offering a 
solution to the fiscal crisis is that it's your fault.
  Here's what I would say. I'm sorry that Republicans spent as much as 
they did, but our average deficit when we controlled spending was $104 
billion. We've now had 3 years for Democrats to control spending, and 
the average deficit is $1.1 trillion.
  And so, what I would tell the gentleman and the American people is 
that what was an annual deficit under Republicans has turned into a 
monthly deficit under Democrats. And again, I'm not proud of the 
spending. Many of us on this floor fought our own party leaders for 
more fiscal restraint. But as far as an order of magnitude, I mean, you 
can't even compare the two. When it comes to spending and deficits, 
Republicans are rank amateurs compared to Democrats.
  Mr. AKIN. I'd like to interrupt you just so you can say that again, 
because that's really hard to get your mind around. In other words, 
what you're saying is that what Republicans spent in 1 year, the 
Democrats are averaging in 1 month, so they're 12 times faster spending 
money.
  You have a chart, I see.
  Mr. HENSARLING. Again, I thank the gentleman for yielding.
  Now, this covers the last several years of when Republicans 
controlled

[[Page 1149]]

the budget. It's in the blue, and you can see declining budget deficits 
until the Democrats took control of Congress.
  Mr. AKIN. So the blue in your chart were Republican, and those were 
the budgets, and the amount that's above the line was how much our 
deficit was, right?
  Mr. HENSARLING. Correct.
  And so, again, I'm not proud of the fact that there were deficits 
under Republican control, but look at the 3 years once the Democrats 
came into control. Look at what happened in 2007. Look at what happened 
in 2008. Look at what happened in 2009. And again, it just goes to show 
that what was an average annual deficit under Republicans has now 
become an average monthly deficit over Democrats.
  Now, I know the President, again, is fond of saying, well, it's not 
my fault. I inherited a mess. Well, I have two observations. You know 
what I would say to the President? Yes, Mr. President, you're right. 
You inherited a mess. I agree. But guess what? When it comes to 
trillion dollar deficits, you inherited it from a Democratic Congress. 
And also, Mr. President, if I recall properly, you were a Member of 
that Democratic Congress. You were a United States Senator and your 
voting record was about as pro-spending as there was. So to some 
extent, if I had the opportunity to speak to the President again, I'd 
say, Mr. President, you kind of inherited the problem from yourself to 
some extent. But even if you didn't--let's just say that the 
administration is absolutely blameless--then why, Mr. President, are 
you making it worse?
  Mr. AKIN. It's not just making it worse; it's tripling it in the very 
first year, tripling it from 450 billion all the way up to 1.4 
trillion.
  I'd like to come back to you, Congressman Hensarling. I want to ask 
you that question that I was getting at, and that is--I think a lot of 
Americans want to know this--when do we hit some tipping point? Does 
anybody know? Is there a certain point here where we have to really pay 
attention, that we're going to get things so far out of kilter that the 
whole deck of cards is going to fall and there's nothing we can do? I'd 
like to get back to that.
  But we have another guest from Florida joining us, Congressman Posey, 
and I'd just encourage you to join us on this question about the 
budget, the tremendous level of spending, the tremendous level of 
taxing, and the tremendous level of debt that we're picking up.
  Mr. POSEY. Well, I thank the gentleman from Missouri for recognizing 
me.
  That's only half of it, and what they are spending and wasting is in 
the wrong direction. We just want to talk a little bit about the wrong 
direction Congress is going, and I hope they won't go further in the 
wrong direction as they continue to follow the President in the wrong 
direction.
  Now, I want to just remind you that when the President was in my 
district campaigning, he made a pledge--it's all over the Internet 
right now--that he would close the gap between the space shuttle 
program and the Constellation program. Initially, it was 3 years that 
we were going to outsource jobs to Russia to launch our astronauts. It 
was $30 million per astronaut for ours and all the international other 
astronauts that we promised to launch. The gap was 3 years. The gap 
grew to 4 years, 5 years, 6 years, looking at 7 years now or maybe 
more. The cost the Russians are going to charge us now is $50 million 
per astronaut. And when we have no more shuttles and no alternative 
launch vehicle of our own, Lord only knows what they're going to charge 
us.
  But back to the campaign promise. The President promised that he 
would close this gap, the time period between the shuttle's last flight 
and the first Constellation flight of the Aries, where we could launch 
men on the Aries.
  Mr. AKIN. So, in other words, for people that are not that familiar 
with the space program, what we're moving from is the old technology of 
the shuttle, which we see launched in those beautiful pictures with the 
hydrogen and oxygen central fuel on the main rocket engines and then 
the two solid boosters. So you see those two tanks on the sides of the 
aluminum, and I think it's ammonium chlorate or something. So you've 
got two solid motors, and you've got the hydrogen-oxygen in the center, 
those three take off. We're replacing that, right, with a new vehicle? 
Is that what you're talking about?
  Mr. POSEY. Correct. And the new rocket would allow us to go back to 
the Moon as well as back and forth to the international space station 
as well as, ultimately, to Mars, our manifest destiny, if you would.
  Mr. AKIN. So this is a more powerful system?
  Mr. POSEY. More powerful than the Saturn V back in the Apollo days, 
actually, carry more people.
  So the President promised that he would close this gap because, as 
the gentleman from Utah (Mr. Bishop) mentioned, we will lose, if we 
don't close that gap, 7,000 of the best and brightest space team 
members this country has ever seen, and he would ensure that we 
remained first in space.
  Now, space is the only thing the United States of America is 
universally, unequivocally, undeniably respected for around the globe. 
A lot of countries respect us for a few things. Some respect us for 
nothing. Some respect us for a lot of things. But the only thing that 
we're universally respected for, bar none, is our space program. We are 
first in space. And it's a matter of national security. And it's a 
matter of economic security. We know all wars aren't fought with 
bullets and bombs anymore.
  So the President made these two promises. They were witnessed and 
they're online. He also said, we need to lead in this global 
marketplace in high technology development, and we need to encourage 
more children to go into math and science. We know now that we are only 
training one-tenth the number of engineers that we need, and half of 
them are foreign students that we expect to go back to their own 
countries. And we know China is graduating 10 times more of these high-
trained, highly specialized engineers than we are. That's not a good 
end game, by the way.
  Mr. AKIN. I want to get you to your point. What you're saying is he 
made a promise that we're going to close this gap. Now, does the budget 
close the gap or not?
  Mr. POSEY. Well, we'll get there. The first thing that happened is he 
accepted the resignation of Michael Griffin, the inspirational genius 
behind the Constellation program and the Aries rocket. And for 6 
months, when they were having the meetings, the NASA chair remained 
empty without an administrator.
  Mr. AKIN. So first of all, no administrator to replace him, which 
doesn't look like something is on the fast track.
  Mr. POSEY. Six months later we got General Bolton. He's the new 
administrator, and he's a first-class guy and he'll do a good job. But 
as soon as Bolton was named, the President created a commission known 
as the Augustine Commission to tell us how we continue to explore space 
under current budget conditions.
  The Augustine Commission met a number of times. They reported to the 
Science and Technology Committee, and they basically said in their 
report, you can't do that on the cheap. You just can't do what needs to 
be done to keep America first in space, much less close the gap. You 
can't do it on the cheap. It's going to take about another $3 billion a 
year.
  Well, we were certainly looking forward to that extra money being put 
into the program. For as little as 1 percent of the failed stimulus 
plan spending, we could have flown that shuttle for 5 years and closed 
that gap.
  Mr. AKIN. So 1 percent of the stimulus bill, which was, I think, 
about $800 billion or so, was it, the one that didn't work, at least 
the rocket motor probably would have gone. This one, we lit it and it 
fizzled.
  Mr. POSEY. Well, you know, the stimulus bill was all about supposedly 
employing people. Now, these are not low-wage jobs in the space 
industry. I think the average, with benefits, is about 80,000 per, 
spread out all across

[[Page 1150]]

this country, and no State is spared the benefit of space technology 
that's been developed. However, while we are having people train to 
hold road signs that say ``Stop'' and ``Go'' to regulate traffic, we 
are getting rid of, literally giving the pink slips to the brightest 
and greatest scientific minds that we have.
  And I want to take you back to Apollo and tell you what's going to 
happen to those people. We had the best engineers in the world who were 
laid off in Apollo literally pump gas at gas stations until their homes 
were foreclosed, and then they were forced to move on, never to return 
to the space program again. We had to completely rebuild the space 
program again, as Mr. Bishop very eloquently discussed a little while 
ago.
  Mr. AKIN. I was just going say that you are really, in a sense, 
making the same case that Congressman Bishop just made; that is, you 
get some very, very highly trained people, you get the program all set 
up, it takes years, a whole lot of research to do it, and then you just 
cut it off at the knees.
  I do have to move along because I wanted to recognize Mr. Bishop on 
this point, and I promised I'd get back to Congressman Hensarling. So 
let me come back to you, but we are getting a little close on time.
  Congressman Bishop.
  Mr. BISHOP of Utah. I appreciate the gentleman from Florida and what 
he's saying. I think we're saying the same thing.
  There are some core responsibilities the government would have to do, 
and the government has promised that they would do these. And the 
people working on the NASA side are the same kinds of people we need on 
the defense side. And one would think, as Mr. Hensarling showed the 
amount of money that's being thrown around in this particular budget, 
with all that, with $3.8 trillion, you could at least cover the needs, 
at least cover what we have to do.
  Mr. AKIN. And gentlemen, both of you have made a very significant 
point. You're saying 1 percent of that stimulus bill--there wasn't a 
stimulus bill, of course. It didn't work, and stimulus bills don't work 
very well anyway. But 1 percent of that would have taken care of that 
promise, would have kept those very high-tech jobs in Florida, and 
would have----
  Mr. POSEY. Around the country.
  Mr. AKIN. Around the country. Okay. And of course the rocket motor, 
the solid rocket technology, these are places where the priority needs 
to be, the thing that--what government can provide for the national 
defense. It's not State governments. This is something that should be 
fundamental to our thinking down here.
  Mr. BISHOP of Utah. If I could ask the gentleman from Missouri, 
because I appreciate you said the key word of ``priorities.'' Before we 
actually deal with our priorities, we have to look at what is in this 
budget and what isn't in this budget, and I think what the gentleman 
from Texas is going to show is we could have done better for the 
American people in this proposed budget, and we must. The status quo is 
not acceptable. The way we've been doing things is not acceptable. 
There has to be a better alternative.

                              {time}  1930

  I would be happy to yield.
  Mr. AKIN. I would like to yield to the gentleman from Texas, 
Congressman Hensarling. I think you have a chart. You want to give us a 
visual picture. We've been talking some boxcar kinds of numbers, but 
sometimes a simple graph is worth an awful lot.
  Mr. HENSARLING. I thank the gentleman for yielding one more time.
  Again, the President, that budget that the President has submitted to 
the American people is simply breathtaking; breathtaking in its 
spending, breathtaking in its deficits, breathtaking in its debt.
  This is a budget that will ultimately put us on the road to 
bankruptcy. There is no other way around it. And I am not exaggerating 
these points. But look at the trajectory of the spending under the 
President's proposed budget. And as we continue to run deficits, the 
red ink is there for a purpose. We have never seen spending at these 
levels.
  Now the gentleman asked a question earlier. At what point do we reach 
the point where that red light is blinking? We're there. Most 
economists believe that you cannot sustain a debt to the economy or GDP 
ratio of over 3 percent, that anything over that long term is 
unsustainable. The President is proposing a $1.6 trillion deficit, the 
largest in American history for this budget, which would weigh in at 
10.6 percent of our economy, largest debt to the economy ratio since 
World War II. The deficit never falls below $700 billion under his 
proposed budget plan. They average a trillion.
  The deficits under this proposed budget will average a trillion 
dollars a year. And so the gentleman asks, is this sustainable? And the 
answer is no.
  And what I really don't understand is we had Dr. Peter Orszag, who is 
the Director of the Office of Management and Budget, who writes this 
budget for the President. Had him before the Budget Committee 
yesterday. And in open committee, the Director of the Office of 
Management and Budget who wrote this said, Yes, it is unsustainable. He 
himself admits that long term this spending plan of the President of 
the United States is unsustainable for the American people, which begs 
the question, well, then, Mr. President, why don't you put a plan on 
the table to solve the problem? Where's the leadership?
  This is a man who was elected to be President of the United States of 
America. His own director of Office of Management and Budget says this 
is fiscally unsustainable.
  So what do they bring to the American people? They bring a 
``commission.'' I am happy to look at a commission if it's fair, if 
it's real; if it's not just a political figleaf. But it begs the 
question again. What the administration is counting on is we're going 
to have some commission, and they're going to propose something and 
maybe Congress will enact it and we will save money that way.
  Again, I would say to the President, With all due respect, Mr. 
President, where is your plan? If you know that you're on the road to 
bankruptcy, why don't you put a plan on the table that solves it?
  What else does the President suggest? They talk about a vaunted 
freeze. Well, unfortunately there is no freeze in the budget. After the 
$1.2 trillion stimulus plan, after several hundred billion of omnibus 
spending plans, another omnibus spending plan, after the proposed 
almost $2 trillion takeover of our health care system, after a proposed 
$800 billion carbon tax, after increasing spending on what we call 
nondefense discretionary--basically the nondefense component of what 
Congress votes on every year--that has increased 84 percent in the last 
2 years.
  And my point is to the gentleman of Missouri is that after this 
explosion of spending, what we hear is the rhetoric of where we have a 
spending freeze. But guess what? When you look at it, 87 percent of the 
budget is not subject to the so-called freeze.
  Second of all, the President decides, I am not even going to turn on 
the freezer for a full year. I am going to wait a full year before I 
turn on the freezer, and then I am going to turn it right back on after 
just a few years on 13 percent of the budget.
  So when you crunch the numbers, what you discover is what the 
President's bold plan is to provide fiscal responsibility at a time of 
fiscal insanity is that he proposes to grow government by 49 percent 
over the next 10 years instead of 49.3 percent. Now, if that's a 
freeze, I would hate to see a spring thaw.
  I will yield back.
  Mr. AKIN. You've really answered the question. We are on some very, 
very shaky ground economically, and you're saying we're already there.
  The thing that is frightening is--and this is something that just 
kind of amazes me--we got punished by voters to a large degree, from 
Republicans and Democrats, that said you guys are spending too much. 
And then what happens is we come down here and triple the rate of 
spending. No wonder people are mad. It's like the people in this 
Chamber are tone deaf.

[[Page 1151]]

  Now, you certainly are not, gentlemen, and I am very thankful. I know 
the American public is thankful for the fact that you hold the line, 
and you're making clear what the priorities are and the fact that we 
can't just run out of control. It's a little bit like the guy that 
says, I am going to stop smoking next month; I am going to stop eating 
too much next month, and just continues with a pie eating contest.
  Mr. HENSARLING. If the gentleman would yield one more time.
  Not only has there been this explosion of debt and deficit, there is 
nothing to show for it but the deficit and debt. Where are the jobs? 
We're told that if we have this massive stimulus program that jobs 
would be created, unemployment would never go past 8 percent--and we 
are still mired in double-digit unemployment.
  Mr. AKIN. The answer to that, as you know, it was a stimulus package. 
It stimulated the creation of a lot of government handouts and jobs, 
but it isn't going to fix the unemployment problem.
  Congressman Posey from Florida, I thank you for coming out tonight. 
Your expertise, particularly the expertise in your district. And 
Congressman Bishop, and I just have got a minute or two and I will 
close with you in a couple of minutes.
  Mr. POSEY. Just three quick points.
  Not only are they spending too much, obviously, but they're spending 
it in the wrong direction. They're touting an extra $6 billion that 
they're going to put into NASA to create 1,500 jobs. But I told you how 
7,000 of them are going to be lost. How did that make any sense to 
anybody? It doesn't pass a straight-face test.
  I love commercial launches. I support commercial launches, 
nongovernmental rockets, and the development of them. But we cannot 
give up a manned space flight program that works, and it's cost 
effective for us right now.
  So I implore Congress to keep the President's promises honest and 
fulfill those promises that the President made. The President obviously 
is not willing to do that. I hope Congress is.
  Thank you, sir.
  Mr. AKIN. Thank you very much.
  One of the things is we talk about this deficit budget and all, I 
think a lot of Americans may not understand we've got something 
stalking us here. People talk about this, that, and the other thing. If 
you want to talk about the fiscal concern that we need to be watching 
in our country, it comes from Medicare, Medicaid, and Social Security.
  This is the budget that is being proposed. This is how much money we 
have in terms of receipts. This is the money that is coming into the 
government. This is what we're proposing spending. And if you take a 
look at that, more than half of that is Medicare, Medicaid, and Social 
Security.
  Those programs are called entitlements. What that means is we wrote 
some laws a long time ago. It's like a machine and somebody's turning 
the crank and it spends money, and it's spending more than half of what 
this budget shows and quite a bit more than what we have in terms of 
receipts. So that is a big question. And that is one of the things that 
we must deal with.
  Congressman Hensarling has been very direct in the fact that we need 
some solutions. We don't need to be on the same drug and drag it out 
until we're completely on our back. We have to start taking a look at 
these problems, take some sober-minded solutions and start moving 
forward with a plan. We've not seen that. We think American people want 
that leadership.
  Mr. HENSARLING. I want to make it very clear. This isn't just us 
saying it. Listen to this. The Wall Street Journal yesterday, ``All of 
this spending must be financed, so deficits and taxes are both 
scheduled to rise to record levels.''
  CNBC, ``The deficit for this year would be 10.6 percent of the total 
economy, a figure unmatched since the country was emerging from World 
War II.''
  The New York Times, ``The budget projects that the deficit will peak 
at nearly $1.6 trillion in the current fiscal year, a post-World War II 
record. It would then decline but remain at economically troublesome 
levels in the remainder of the decade.''
  CNBC, ``Part of a record $3.8 trillion budget that would boost the 
deficit beyond any in the Nation's history.''
  It is unacceptable. We have better alternatives.
  Mr. AKIN. Thank you, Congressman Hensarling and Congressman Posey. 
And I thank you, also, Congressman Bishop, for joining us tonight.
  Thank you, Mr. Speaker. I think that concludes our hour.

                          ____________________