[Congressional Record (Bound Edition), Volume 156 (2010), Part 3]
[Senate]
[Pages 2934-2935]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          FISCAL RECKLESSNESS

  Mr. ENSIGN. Mr. President, I rise to discuss the tax extenders 
legislation and the consequences of our fiscal recklessness. I cannot 
stress enough that our spending is completely out of control. It seems 
every week this body passes more legislation and spends more money and 
adds more debt onto the backs of our children. Unfortunately, the 
Democratic majority continues to sing from the same old sheet of 
music--more debt, more spending, and more fiscal recklessness. Last 
week the nonpartisan CBO provided their analysis of President Obama's 
budget, and it is nothing short of a fiscal train wreck and a roadmap 
to banana republic status. It pains me to stand on the floor of the 
Senate and tell the American people that President Obama is leading us 
down a path of bankruptcy.
  I believe this budget is simply reckless, with enormous budget 
deficits as far as the eye can see. This year, the government has 
overspent by more than trillion dollars; the same amount last year. We 
are passing trillions of dollars in debt onto our children and 
grandchildren. Nevadans and people across the country are facing very 
hard economic times. For the Federal Government to be spending this 
much money is an insult to American families everywhere.
  In 2020, the last year of the President's budget, our Nation's credit 
card bill will account for 90 percent of the economy. What does this 
mean in terms real people can understand? Because these numbers are so 
large and enormous, it is difficult to put them in perspective. Let me 
talk in terms of the consequences of this fiscal recklessness. At a 
certain point, foreign countries will not buy our IOUs, our bonds, or 
they will demand higher interest rates because they are riskier. Our 
standard of living will decrease. Actually for the first time in 
American history, future generations will be worse off than prior 
generations. As to the American dream of owning a home as a young 
adult, one will have to wait until their 40s or 50s to buy a home. 
Families, in order to maintain a similar standard of living, will have 
to become smaller. With a less dynamic economy, we will enjoy less of 
the fruits of innovation and technological progress.
  I know this is hard to hear, but one day, if we continue down the 
current path, this scenario will become a reality. We cannot keep 
spending and spending and spending without consequences. Democrats 
claim we need to spend money because our economy is sluggish. We need 
stimulus after stimulus to put us back on the right track.
  We are not on the right track. Unemployment in my State is still 13 
percent. There isn't much light on the horizon. We have lost our way 
and have wandered down a path of fiscal crisis. More spending doesn't 
fix the economic crisis.
  I wish to talk about the depression of 1920 to 1921. Shortly after 
the end of World War I, we went into economic crisis. The Department of 
Commerce estimates the economy declined by nearly 7 percent during that 
period. Unemployment rose sharply during the recession. Estimates are 
the rate of unemployment went from around 5 to almost 12 percent. From 
May of 1920 to July of 1921, automobile production declined by 60 
percent, and total industrial production across the country decreased 
by 30 percent. Stocks also fell dramatically. The Dow Jones Industrials 
was cut by almost half. Business failures tripled between 1919 and 
1922.
  But instead of ``fiscal stimulus,'' here is what President Harding 
did. He cut the government's budget nearly in half between 1920 and 
1922. Marginal tax rates were slashed across all income groups. So he 
cut taxes and cut government spending at the same time. This encouraged 
businesses to grow and to add jobs in the private sector. The national 
debt was reduced by one-third.
  In the 1920 acceptance speech for the Republican nomination, Harding 
said:

       We will attempt intelligent and courageous deflation, and 
     strike a government borrowing which enlarges the evil, and we 
     will attack the high cost of government with every energy and 
     facility which attend Republican capacity.
       We promise that relief which will attend the halting of 
     waste and extravagance, and the renewal of the practice of 
     public economy, not alone because it will relieve tax burdens 
     but because it will be an example to stimulate thrift and 
     economy in private life.

  You see, Harding's laissez-faire economic policies, rapid government 
downsizing, and low tax rates spurred a private market recovery and led 
to a readjustment in investment and consumption for a peacetime 
economy.
  The unemployment rate went from almost 12 percent in a little over a 
year to less than 2 percent. Let me repeat that. The unemployment rate 
went from almost 12 percent to under 2 percent. I do not think that is 
what is happening today.
  This episode in history provides a counterexample to the argument 
that we need massive government spending to stimulate our Nation's 
economy. You see, we do not hear about the Great Depression of 1920. 
Instead, we hear about the Roaring Twenties because sound fiscal 
policy, cutting tax rates, cutting spending led to economic resurgence.
  This is an example that shows when the burden of government is 
lessened through less spending, less taxes, and less debt, the private 
sector will respond with investment and job creation, which lead to 
economic growth.
  So why is the legislation on the floor today not the answer? If 
creating jobs is priority No. 1--and it should be for this body--why is 
the majority party letting tax incentives for job-creating businesses 
expire? These noncontroversial provisions expired 3 months ago. Why is 
helping businesses an afterthought for the majority?
  The tax extender portion of this bill could have passed by unanimous 
consent months ago. But the majority did not want to bother with that. 
It will have to be extended again later this year because the 
provisions will again expire on December 31.
  This is not the right policy for creating a stable and certain 
environment for employers who are wanting to hire more employees. The 
tax extender provisions of the bill amount to only $25 billion of this 
massive $144 billion bill.
  The tax extenders are good. They include energy production credits, 
research credits, accelerated depreciation for certain businesses, 
State and local sales tax deductions, and low-income housing tax 
credits.
  I have said these are good provisions. But we should have done much 
more. Foremost, we should be cutting individual and corporate income 
tax rates so people and businesses could use their money to get the 
economy moving again and could invest in job creation and wealth-
creating enterprises. But, at the same time, we need to cut government 
spending so we are not massively increasing the debt. You see, I hate 
to break it to you, but America is falling behind other countries in 
that regard. Tax relief is wrongly criticized by those across the 
aisle. They have been arguing for job creation, but their policies are 
making it tougher on private businesses.
  In order to help these businesses find a stable footing once again, 
we need to make tax relief permanent and not wait for these extensions 
to expire again and again.
  Let me conclude. To get this economy moving, we do not need to pass a 
bill that is going to add over $100 billion to our deficit and our 
debt. That is what the bill before us today does. It adds over $100 
billion to our deficit and our debt.
  A few years ago, $100 billion was a lot of money around this place. 
We throw that amount around here like it is nothing anymore. That is 
debt that is adding to the coming fiscal crisis this country is going 
to be facing.
  I believe the prescription to get this economy going is to cut taxes, 
cut government spending. I believe in the spirit of the American people 
and the American entrepreneurs instead of creating jobs here in 
Washington, DC. I do

[[Page 2935]]

not know if the American people know that over 100,000 jobs were 
created in this city last year--over 100,000 jobs in Washington, DC. 
That is about as many jobs as my State lost. That is not the 
prescription for economic prosperity.
  Government jobs have to be sustained with tax dollars year after 
year. When the private sector creates those jobs, the whole economy 
grows and feeds off itself, and you do not need taxpayer dollars to 
continue to subsidize those jobs. As a matter of fact, they feed in 
money to the Federal Treasury.
  The bill before us today, I think, is fiscally irresponsible. It is 
the exact opposite direction we should be going. What we should be 
doing is acting in accord as Americans--not as Republicans, not as 
Democrats--but let's look at history and learn from it and get this 
economy going by focusing on actually what has worked in the past and 
what will work in the future.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Utah is recognized.
  (The remarks of Mr. Bennett pertaining to the introduction of S. 3096 
are printed in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  Mr. BENNETT. Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. COBURN. Mr. President, I understand the Senator from Virginia is 
going to speak now, and I ask unanimous consent that when he finishes, 
I be given 45 minutes at the completion of his time.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The Senator from Virginia.

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