[Congressional Record (Bound Edition), Volume 156 (2010), Part 11]
[House]
[Page 15419]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   SUCCESSFUL GOVERNMENT INTERVENTION

  The SPEAKER. The Chair recognizes the gentleman from Virginia (Mr. 
Connolly) for 5 minutes.
  Mr. CONNOLLY of Virginia. Madam Speaker, according to independent 
economists, the action of this Congress pulled the economy back from 
the brink of falling into another Great Depression.
  I hope my colleagues have had a chance to review the recently 
released study by former Federal Reserve Vice Chairman Alan Blinder and 
Mark Zandi, Moody's Analytics chief economist and former economic 
adviser to John McCain's 2008 presidential campaign.
  We have heard some from the other side of the aisle demagogue on the 
value of the Recovery Act and other actions we took to stabilize this 
economy. Republicans loudly claim these programs were failures. But 
what do the actual economists say? From the study, I quote. ``There is 
little doubt that, in total, the policy response was highly 
effective.''
  Madam Speaker, after careful analysis, the study's bipartisan authors 
conclude that the Nation's gross domestic product would have been 11.5 
percent lower than it is today without government intervention. They 
conclude that an additional 8.5 million working Americans would have 
lost their jobs.
  When this Congress took office in January of 2009, we were facing an 
economy in freefall with the second Great Depression in clear sight. We 
were in the midst of a deepening recession, the worst in 80 years. 
Increasing monthly job losses had peaked in January of that year at 
741,000; housing prices were mired in 22 straight months of decline; 
foreclosures dramatically increased. The economy's contraction was 
worsening as gross domestic products shrank at an increasing rate each 
quarter. Bank failures accelerated, threatening family savings. All 
combined, Americans lost $17.5 trillion in net worth because of the 
Bush recession. And in the midst of this economic maelstrom, in the 
face of the united opposition from the minority, we took action, 
immediate action, and passed the Recovery Act to stabilize the economy, 
protect teachers, firefighters, police officers, boosted the private 
sector payrolls, invested in America, and spurred growth.
  According to the experts from both sides of the aisle, it worked. 
Again quoting from the study, ``The effects of the fiscal stimulus 
alone appear substantial.'' Madam Speaker, they found that the Recovery 
Act raised GDP by 3.4 percent, reduced the unemployment rate by 1.5 
percent below where it otherwise would have been, and, most 
importantly, added or protected 2.7 million American jobs.
  The proof is in more than just the study. Look at the GDP. Before we 
passed the Recovery Act, GDP was declining for the third straight 
quarter, including a 2.7 percent drop in the third quarter of 2008, a 
5.4 percent drop in the fourth quarter, and an astonishing 6.4 percent 
decline in the first quarter of 2009 when we came into office. The 
Recovery Act slammed the brakes on that freefall. The very next 
quarter, GDP posted only a 0.7 percent decline, quickly followed by 
four straight quarters of GDP growth.
  The Recovery Act also stemmed the ever increasing monthly job losses. 
It is no coincidence that the job losses peaked just before we acted 
and then immediately began to drop.
  Currently, we are in our seventh straight month of private sector job 
growth, with 600,000 net private sector jobs created this year alone. 
The manufacturing sector continues to expand in fact to its highest 
levels. American automobile sales, initially spurred by the successful 
Cash for Clunkers program, continue to improve. The stock market, which 
plummeted throughout 2008 and hit rock bottom in the first quarter of 
2009, has rebounded since, increasing more than 60 percent. In fact, we 
have recovered $6 trillion of the $17.5 trillion lost by American 
families.
  Madam Speaker, the Blinder and Zandi study illustrates our 
intervention and investments through the Recovery and Reinvestment Act 
saved the U.S. economy from the second Great Depression. But, as the 
recent study demonstrated, we averted the worst outcome, but we still 
have work to do.
  Make no mistake. Despite the fragile economy, our economy is growing 
again, and that growth is the direct result of the actions of this 
Congress to save American taxpayers and to save this economy.

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