[Congressional Record (Bound Edition), Volume 156 (2010), Part 7]
[House]
[Pages 10349-10356]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  THE ISRAEL BLOCKADE AND THE FLOTILLA

  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, I yield to the gentlewoman from New York (Mrs. 
Lowey.)
  Mrs. LOWEY. I thank the gentleman. I'm just going to complete my 
statement, and I appreciate your generosity.
  The administration focused today on humanitarian and development 
assistance to strengthen the Palestinian Authority so it can serve as a 
viable partner in peace to Israel. But Abu Mazen must make clear to all 
the Palestinian people that their security and prosperous future--and 
we've seen an 11 percent growth in the West Bank--depends on rejecting 
Hamas, recognizing Israel, and working with the international community 
and Israel to achieve a two-state solution.
  Despite the current tense environment, some positive steps have been 
taken that will improve Israel's security as well as bolster U.S. 
national security interests. Iran continues to be an existential threat 
to Israel, the region, and the world. I am pleased today's agreement by 
the U.N. Security Council to impose multilateral sanctions on Iran will 
hold the regime accountable for its reckless pursuit of nuclear 
weapons, and I look forward to Congress finalizing strong bilateral 
sanctions and urge European partners and other responsible countries to 
do the same.
  We must continue to strongly support the U.S.-Israeli partnership 
which provides invaluable benefits to both of our countries' national 
securities.
  Mr. AKIN. I yield to my good friend from New York (Mr. Engel).
  Mr. ENGEL. I thank the gentleman, and I will be brief. I rise in 
support of everything that my colleagues have said.
  The U.S.-Israel relationship is a special relationship, and it's a 
relationship that needs to be strengthened. The United States is 
Israel's only true friend. In fact, when you look at the United Nations 
or the so-called Human Rights Council in the United Nations, it's 
really a kangaroo court stacked up against Israel. No wonder Israel 
doesn't accept what the so-called ``international body'' says about 
them, because they can never do anything right. They're always 
condemned no matter what they try, no matter what they do.
  My colleagues have pointed out that Israel, like every other 
sovereign nation, has the right to defend itself, that Israel has at 
least twice seized large caches of arms aboard Iranian ships bound for 
Hamas and Hezbollah, and a blockade is an appropriate security measure 
when employed in the face of hostility such as that directed by Hamas 
against Israel.
  Hamas doesn't recognize Israel's right to exist, has vowed to destroy 
Israel, won't abide by any agreements that have been signed by Israel 
and the previous Palestinian governments, and so Israel has to make 
sure that terrorist attacks don't come from Gaza into Israel as they 
have for such a long time. As my colleagues have pointed out, Israel 
has offered to inspect the flotillas and let all the humanitarian aid 
on the flotillas go to Gaza, but these people on the flotilla were 
obviously not interested in delivering humanitarian aid. They were 
interested in provoking a violent reaction from Israel.
  I just want to stand in support of the U.S.-Israel relationship, a 
strong relationship. Israel is our best friend and ally in the Middle 
East. Hopefully, soon there will be a solution to the Israeli-
Palestinian conflict, two states side by side living in peace and 
harmony, a Palestinian state and an Israeli Jewish state. That is 
something that we all strive to work for.
  I want to thank Mr. Weiner for organizing this. I want to thank Mr. 
Hoyer, our majority leader, for always being a stalwart. I want to 
thank Mr. Akin for giving us the opportunity to speak. When it comes to 
Israel, this Congress is united with strong bipartisan support, and 
we're going to keep it that way.
  Thank you.
  Mr. AKIN. I thank the gentleman. I think you're articulate, and I 
think that that's accurate to say: there is a good bipartisan sentiment 
that when a small nation is trying to defend itself, we have always 
stood for people.
  The basic principle of people being allowed to be free and have some 
self-determination as to how they're going to rule their own country 
and be free from the fear of terrorists, that's something that 
Americans can really agree on. I appreciate you taking time on that 
subject, and also my good friend from New York taking the time to 
organize the hour. Very good job. Thank you.
  Mr. WEINER. If the gentleman would briefly yield, I, too, want to add 
my thanks to you. I don't know if they have C-SPAN in Israel, but 
sometimes it's easy in that little country to feel beset on all sides. 
We share the same common sense that they do, that they're victims of 
terror, and I want to thank you.
  We disagree on a lot in this place--and you're going to spend the 
next hour or so pointing out some of those things--but there are some 
things that have broad bipartisan support, and the support of Israel is 
one of those things, and I want to thank you for being at the forefront 
of that.
  Mr. AKIN. Well, thank you very much, gentleman. And thank you for the 
leadership you've shown tonight.


                              The Economy

  Mr. AKIN. I would now change gears here and get on to another 
subject.
  We're dealing with some weighty topics tonight; the previous was of 
course international relations, the other is closer to home, and it's 
really the question of the economy: the Democrats' management of the 
economy, what should be done with the economy, how does that affect 
jobs and how does that affect all of our lives. I guess it sounds like 
kind of a boring subject in some ways; but on the other hand, it so

[[Page 10350]]

much influences and affects every single person in our country that I 
guess we have to put up with a little bit of talk about economics just 
to make sure that we're not destroying our country or destroying our 
jobs and putting our grandchildren into debt. And so the whole topic of 
economics and jobs can be a little perplexing, but it doesn't have to 
be.
  I do apologize ahead of time that I am, by training, an engineer. 
Someone once said that engineers shouldn't be allowed in political 
office perhaps because they're too logical, or whatever the reasons 
are. But I do think it's important to back up just a little bit to say 
where we are here in the economy and how we got to where we're going 
and what mistakes have been made.
  I'm not one to want to just criticize and not offer a solution, so 
I'm going to try to do that. I'm going to try to draw some practical 
applications as we wrap up in a while as to what we should be doing, 
what policies should be changed, what does America have to do to pull 
ourselves out of the economic nosedive that we're currently in.
  It's not a graveyard spiral. There were days in the early days of 
airplanes that when a pilot pulled his airplane up into a stall, fell 
over backwards, he would get into what was called a graveyard spiral. 
And the pilot would grab the stick of the airplane, pull it back 
violently to try to get the nose of the airplane to pull off from the 
ground and the airplane would just keep spiraling down and crash into 
the ground. It ruined the pilot's whole day. Our economy may be at a 
graveyard spiral, but there are things that we can do to prevent it 
from crashing, but we're going to have to do that and do it soon. So 
that's what I want to take a look at.
  I want to back up just a little bit to the days back at this 
superconservative oracle, The New York Times. This is September 11, 
2003. This is really the beginning of President Bush's Presidency, and 
he goes to the New York Times--and this is September 11, but it's not 
2001, it's 2003--and it says here, this is the article: The Bush 
administration today recommended the most significant regulatory 
overhaul in the housing finance industry since the savings and loan 
crisis a decade ago. That's interesting. President Bush was saying in 
2003 that we've got to take a look at this finance industry and the 
overhaul of this housing finance industry. And under the plan disclosed 
at a congressional hearing today, a new agency would be created within 
the Treasury Department to assume supervision of Fannie Mae and Freddie 
Mac, the government-sponsored companies that are the two largest 
players in the mortgage lending industry. Interesting. This is way 
before the mortgage-backed security thing hit the fan and the whole 
stock market crashed and all that sort of stuff; this is way before 
that.
  So President Bush, he's saying, okay, let's regulate these because 
they're out of control. They've lost $1 billion or something. And he 
thought, well, that's not pocket change. Here's the President asking 
for this authority, and what do we have from then in the minority? We 
had this from Representative Frank, he says: These two entities, Fannie 
Mae and Freddie Mac, are not facing any kind of financial crisis. The 
more people exaggerate these problems, the more pressure there is on 
these companies, the less we will see in terms of affordable housing. 
Now, people who know Freddie and Fannie know that these guys were big 
players here on the Hill. They had lobbyists that were terribly 
effective, went around and distributed a whole lot of money to a lot of 
people, and they didn't want anybody playing in the deal they had 
going.
  So what happened here? Well, what happened was the House--at that 
time in Republican control--passed a bill to regulate Freddie and 
Fannie. It went to the Senate, and what do you think happened to it? 
Well, in those days, Republicans had a majority in the Senate, but they 
didn't have the 60 votes necessary for cloture, and so the bill was 
killed by Democrats in the Senate. Freddie and Fannie continued on 
their merry way, and all of a sudden, a number of years later, what 
other people had seen--Bush had seen years before--was going to happen, 
it happened, and we had this great big crisis start. Now, that was all 
connected with ACORN, the organization that was pushing banks to make 
loans that normally a bank wouldn't make because the people that the 
loans were going to be made to couldn't afford to pay them.
  So we started going on this track of passing out loans to people that 
couldn't afford to pay them, and every time we sold one of those loans, 
somebody made some money. And what did they do with all of those bad 
loans? They dumped them all on Freddie and Fannie. And as you know, you 
just keep doing something like this, pretty soon the music is going to 
stop and there are going to be people without chairs. That's what 
happened in the savings and loan problem.

                              {time}  1945

  Now, what is going to be the solution? Well, we are going to talk a 
little bit about that, about where we are going with the economy and 
about what we need to be doing.
  I am joined now in the Chamber by a good friend of mine, Dr. Paul 
Broun, from the Atlanta, Georgia area, if I recall properly--not 
Atlanta but, rather, some other part of Georgia.
  Mr. BROUN of Georgia. The northeast corner of the State of Georgia. 
Athens and Augusta are my two major cities.
  Mr. AKIN. I yield to the gentleman. I don't know what you think about 
Atlanta, so I won't say anything about that.
  My good friend from Georgia, Congressman and Dr. Broun, please join 
us.
  Mr. BROUN of Georgia. Well, thank you, Mr. Akin, for yielding.
  I'll tell you what. I hope the American people paid attention to your 
explanation because it has been Democrats all along who have fought any 
reform of Freddie and Fannie. Freddie and Fannie are right in the 
middle of the cause of the financial downturn that we've seen today.
  Just today, we voted on trying to name a committee of conferees from 
the House and the Senate to talk about financial services, and we tried 
to bring Freddie and Fannie into the fold, but Democrats across the 
board have rejected from 2003, all the way up to today, to solve the 
problem. When you have a fire going, you want to try and find out the 
source of that fire and put out the source.
  I'm a medical doctor. When you have a medical problem going on, you 
try to find the source of that problem. If you have a cancer, you want 
to not just deal with the symptoms of the cancer or even of the 
metastasis--the spread--of the cancer, but you want to go with the 
primary tumor and get it out.
  So Freddie and Fannie are the source of the problem, and Democrats 
across the board have resisted from 2003, all the way to today, the 
efforts the Republicans have made to try to cut out this cancer of 
Freddie and Fannie.
  Mr. AKIN. I think what you're saying is important. You're using some 
doctors' analogies.
  Mr. BROUN of Georgia. I'm a doctor.
  Mr. AKIN. I think that's good. It paints a vivid picture, but there 
is a problem with Freddie and Fannie.
  Mr. BROUN of Georgia. Absolutely.
  Mr. AKIN. The problem with Freddie and Fannie is you don't get 
something for nothing. I'm an engineer. I mean, it's one of those 
things, if it isn't there, it isn't there. So what we're doing is we're 
using Freddie and Fannie to make loans to a certain number of people 
who can't afford to pay them. Then that means, Where is the money going 
to come from?
  Mr. BROUN of Georgia. Taxpayers.
  Mr. AKIN. That's the point.
  So the deal is: Is it the job of the American public to bail out 
people who make irresponsible loans? How about all of the people who 
get loans, who make their mortgage payments, who do everything by the 
book, who then get hammered because somebody else didn't do it that 
way? That's the basic question.
  Is there any sense of fairness in this? Is this a good way to run a 
ship? Because what we're doing is creating an incentive for people to 
do the wrong

[[Page 10351]]

thing, which is to take loans they can't afford to pay. They put more 
stress on their own families economically.
  How is that compassionate, by the way, when you're the dad, 
supposedly providing for your family, and you're in danger every month 
of the mortgage payment, and they're going to put you and the kids and 
the sofa out on the front sidewalk? That's not compassionate. Yet 
that's what these policies on Freddie and Fannie are doing. So we need 
to reform Freddie and Fannie, and apparently, we're not willing to do 
that.
  Hey, I want to jump forward just a little bit, gentleman. I want to 
jump forward now past Freddie and Fannie. We've got the whole trouble 
with Wall Street starting to melt down. We do the great big bailout of 
Wall Street. Then the center point of the Democrats' plan was the 
stimulus package. Unemployment started to go up, and the economy was 
dipping. They said, This is a great opportunity for us to spend money 
on all the things we want to spend money on. So they spent $800 billion 
on the stimulus package, which is a whole lot of money, and the idea 
was, if we spend enough money, it will get the economy going again in 
spite of fixing Freddie and Fannie.
  Now, what do you think about that theory that, if the government 
spends tons of money, it's going to somehow get the economy going? You 
know, a lot of people believe that idea.
  I yield to my friend.
  Mr. BROUN of Georgia. Well, I thank you, Mr. Akin, for yielding.
  This has been described as Keynesian economics, which means bigger 
government spending and more borrowing. You've got a great quote there 
by Henry Morgenthau, who was FDR's Treasury Secretary. During part of 
the Great Depression, he made this great quote, which reads, in part, 
that we have just as much unemployment as when we started all of this 
massive government spending, and an enormous debt to boot. That's 
exactly what we're doing.
  Most American people know--not all, and it's unfortunate. Most 
American people know that socialism never has worked and never will 
work, but this is socialistic, this type of philosophy of bigger 
government, of central control from wherever the capital is. We saw it 
in the Soviet Union. It is what Stalin put up there in the Soviet 
Union. In fact, FDR sent his lieutenants to Russia. Back during that 
period of time when the Great Depression started, which was early on in 
the Roosevelt Presidency, he sent his lieutenants to look at what 
Stalin was doing because they thought this was the greatest thing in 
the world and that we needed to put in place that kind of policy here. 
That's exactly what is going on right now with our leadership. They may 
as well send their lieutenants back. They should go back and look at 
the history of what Stalin did, and they should understand from history 
that it doesn't work, because it will not and cannot.
  Mr. AKIN. You know, I really appreciate your jumping a little bit 
ahead because you anticipated where I'm going.
  There have been some assumptions made by the Democrats about the 
economy, and the question is: Are those assumptions any good or not?
  One of the things that history does tell us is we should learn 
something from it. Of course, FDR's Treasury Secretary, Henry 
Morgenthau, after trying it for 8 years, turned a recession into the 
Great Depression, and we consider it the greatest depression we had. 
What they did was they just spent tons of Federal money, but at least 
they spent it on concrete, like great big dams and roads and building 
projects. Of course, the $800 billion that we spent wasn't spent on a 
lot of stuff. It was much more of just government giveaways.
  We are joined by my good friend, Congresswoman Lummis. I would just 
be delighted if you could jump into our conversation here. We are 
focusing, really, on the economy: What assumptions have been done that 
are wrong? What do we need to get it fixed so as to straighten things 
out?
  Mrs. LUMMIS. Well, thank you. I thank the gentlemen for allowing me 
to join you both this evening.
  I thank the gentleman for his courtesy to the previous group that was 
talking about our policy with Israel. I thought that was appropriate to 
allow them to finish their remarks and to acknowledge the importance of 
our allies there.
  One of the issues that we are going to have to address, as we address 
this economic downturn we are in, is the role of the Federal Government 
in exacerbating the problem.
  As we all know, Federal employment and private-sector employment are 
not the same thing. A private-sector job pays for other people's jobs 
through taxes; whereas, a public-sector job consumes more than it pays 
in taxes. So it's important that we watch the relationship and the 
growth of Federal jobs versus the decline in private jobs.
  This first chart that I have shows the Federal Government employment 
and how it has changed in the past number of years. I'd like to point 
out the years 2002, 3, 4, 5, and 6 when the Federal Government's 
employment was relatively flat--in fact, almost as flat as a pancake. 
Then we get into the Pelosi Congress, and it's going up markedly, with 
the year 2010 here on the end of this chart showing you that we're 
getting back to levels that are unprecedented since Republicans took 
over control of Congress in 1995.
  I also want to illustrate what has happened to private-sector 
employment during this time period. This chart compares private-sector 
employment to public-sector employment, or government employment. The 
red line is government employment. This more flat line of the red line 
illustrates, once again, those years that were relatively stable--2003, 
4, 5, and 6. Then the Pelosi Congress took effect, and here the 
government employment begins to shoot up.
  The scary part of this chart is the blue line, which is what is 
happening to private-sector employment. It has crested. Then from the 
Pelosi Congress on, it has declined dramatically, and these are the 
years of the Pelosi Congress. When private-sector employment plummets, 
the ability to pay for your family plummets. Unemployment payments go 
up. Of course, those are coming out of the public sector. Tax 
collections go down. The number of jobs, of course, declines 
dramatically. This is an illustration of what has happened to our 
economy. Unless we get this number under control, we are in trouble.
  Among the things that I oppose, which the majority party here in 
Congress is pursuing, are tax increases on the employer class. The 
employer class includes those small businesses all over the country 
which are employing less than 50 employees who are unable to borrow 
money because of the constraints on capital that you addressed earlier, 
Mr. Akin. All of these create the downward spiral that we are seeing. 
In order to get out of that spiral, we have to make dramatic changes in 
our tax policy, in our spending policy, and in our overall economic 
policy in relation to other countries and in relation to the amount of 
debt that we are issuing.
  I yield back.
  Mr. BROUN of Georgia. Will the gentlelady yield?
  Mr. AKIN. I yield you time, gentleman.
  Mr. BROUN of Georgia. Well, I'm sorry. I apologize, Mr. Akin.
  I just wanted to address those things that you were talking about, 
Mr. Akin--the Great Depression, the government spending and that the 
unemployment didn't go up. As to what Mrs. Lummis just so very capably 
showed us, government jobs are going up.
  During the Depression, though, as you just said, there was a lot of 
spending on infrastructure during that period of time. It did not take 
care of the unemployment. If you look at the unemployment rate during 
the Great Depression, it stayed relatively flat. It went up and down 
some, but it stayed up a bit, and then it fell way off in spite of all 
the big government spending and all the spending on infrastructure.
  Back then, though, under the Roosevelt administration, they created 
the WPA and the CCC camps and things like that. They put people to 
work, who were on government welfare,

[[Page 10352]]

building all that infrastructure. Now we're paying people not to work.
  Mr. AKIN. So things have changed, and it has gotten even worse, 
hasn't it?
  Mr. BROUN of Georgia. It really has.
  Mr. AKIN. Let me just jump in for a moment.
  You know, the charts that you chose actually have a relationship to 
each other, and you alluded to the mechanics of what that connection 
is, which is, when the government creates a job by hiring somebody, it 
does create a job. The problem is it kills two other jobs in the 
private sector. So you think to yourself, hey, if we have unemployment, 
for the temporary sense, let's get the government to spend some money 
and hire a bunch of people, and that will take care of the problem in 
the short term. Maybe the economy will rebound, and then maybe the 
government will shrink, and more private-sector jobs will come along. 
Not so. What happens, in fact, is, when the government creates jobs, it 
spends a whole lot more money. It takes money away from the private 
sector, and it drives the number of private jobs down.
  So what you've just shown is an illustration and an example of a 
failed economic policy. It's a failed economic policy, and we should 
have known from Henry Morgenthau that it wasn't any good and that it 
wasn't going to work. He said, Look. We've tried spending money. We're 
spending more than we've ever spent before, and it doesn't work. Now 
we're turning around and are doing it over again. With 8 years in the 
administration, we've just as much unemployment as when we started and 
an enormous debt to boot.
  So what are we doing now? Oh, we're repeating this same foolish 
policy.
  Here it is. Nobody really wants to look at this graph. This is the 
deficit under the Democrat budget. Now, I'm a Republican, and I'll 
admit that we spent too much money when President Bush was President, 
but it wasn't as bad as it could have been. People didn't know how bad 
it could be. Now we do. Take a look at that. The very worst year of 
President Bush's spending was in the Pelosi Congress here in 2008. That 
was his highest amount of deficit in a given year. That's one-third of 
what it was under Obama, the next year, and this is even more so.
  Mr. BROUN of Georgia. Will the gentleman yield?
  Mr. AKIN. I do yield.
  Mr. BROUN of Georgia. I wanted to put some perspective on 2008, too. 
That's when the President's chief economic adviser--I guess the 
Treasury Secretary--told him that the sky was falling and that we 
needed to pass the Toxic Asset Relief Program, or TARP, which many 
Republicans voted against. I didn't buy the Democratic Treasury 
Secretary under a Republican President because that's exactly what Hank 
Paulson is. He's a Wall Street insider, a Wall Street banker. Wall 
Street believes in big government. That's the reason they support the 
Democrats. They overwhelmingly support Democrats financially.
  That increase in 2008, under Bush, is principally because of the TARP 
bill that a lot of people didn't like. I did not vote for that. I've 
argued very much against it, and I have been a strong critic of the 
Bush administration's being big spenders, but they were pikers compared 
to the Pelosi Congress ever since she has been in charge.

                              {time}  2000

  And even that is just miniscule compared to what has happened just 
over the last 16, 17 months.
  Mr. AKIN. It seems to me, gentlemen, that President Bush was Ebenezer 
Scrooge by comparison to what we've got here. I mean, this is runaway 
spending.
  And this is created not just by TARP, not just by the, quote, ``jobs 
bill'' where we just dumped all kinds of money into increasing various 
government handouts and things. It wasn't concrete and roads; it was 
just government-handout kinds of things.
  But this tremendous level of spending then creates the very problem 
which creates the unemployment, and it threatens our economy.
  If you take a look at where this is going, you take a look at these 
numbers, and you start to put it--these seem like a lot of money. This 
one here is $1.4 trillion. Well, what does $1.4 trillion mean? Well, 
let's put it into context.
  Here's the context right here. This is a comparison to these other 
countries over in Europe. This is deficit as a percent of GDP. United 
States, 10.3. We've got Greece at 9.4.
  Now, Greece has been in the news. It's been causing a whole lot of 
trouble in the European Union. And its deficit as a percent of GDP is 
9.4, and we're 10.3? These are not good numbers.
  I think it's helpful to compare to the others. United Kingdom is a 
little worse off than we are. If you go debt, this is a larger term, 
this is going year after year after year, you see United States here is 
at 99, debt as a percent of GDP. And you've got Greece and Italy that 
are worse off than we are.
  That's not a good sign when we're in third place to Greece and Italy 
from an economic point of view. So this rate of spending just does not 
work. This is a glide path.
  I used the analogy of, you know, the guys, the World War I pilots 
that used to fly those airplanes, whatever it was that Snoopy used to 
fly. Many of those planes, they would get into that spiral and they 
would just start to head down for the Earth.
  And that is what has happened, is, because of lousy economics, we are 
in essentially a graveyard spiral in America. And you, my friends, know 
what the solution is to fix this.
  And there was a solution to the graveyard spiral. And maybe it seemed 
a little counterintuitive, but from a pilot's point of view, what 
they're supposed to do--their instinct is to pull back on the stick to 
pull the nose up. Instead, you had to do the counterintuitive thing, 
which is push the stick down. And that would stop the spiral, the plane 
would start diving, and when they had control, then they could pull the 
stick back up again.
  And there's the same kind of thing in our economy, which we have to 
do or this economy is going to crash. And if you think 10 percent is 
bad for unemployment, it could get a whole lot worse.
  I yield to my good friend, Congresswoman Lummis.
  Mrs. LUMMIS. I thank the gentleman for yielding.
  The chart he has up does compare the U.S. to Greece. But what is 
really frightening about that chart is, in 5 years, our debt to GDP 
will be at 112 percent, whereas right now Greece is 115 percent. In 
other words, in 5 years, we're going to be right where Greece is right 
now. And that illustrates the type of nosedive that the gentleman said 
we are in.
  Mr. Akin, could I ask you to put up the chart that you have there 
that is called ``Tidal Wave of Debt''?
  The chart that he's going to put up was prominently displayed on 
numerous occasions today in the House Budget Committee, where we heard 
from Dr. Ben Bernanke, the Chairman of the Federal Reserve. Multiple 
questions made reference to this chart. And it is the trajectory on 
this chart that Dr. Bernanke expressed such concern about.
  If you look at the line of 2010 and follow it through the year 2046, 
which is the end line of that chart, you see the enormous upward spiral 
of our debt. This is, of course, part of the unsustainable situation 
that Dr. Bernanke was asking us to address. And if we do not, we will 
put our country in terrible financial straits.
  So, we talked about a number of alternatives. One is 
americanroadmap.org, which is the ranking member of the Budget 
Committee, Paul Ryan's proposal. It is very comprehensive. It would 
have a slow glide path to bring both our deficits and our debt under 
complete control, and do it without raising taxes, and do it without 
affecting the Social Security or Medicare benefits of people over age 
55 or 56.
  The problem is, the longer we wait, the more out of reach that type 
of strategy becomes because of the enormous crowding out of our budgets 
that will happen by interest on our national debt. Consequently, we 
need to address the Paul Ryan proposal sooner rather than later.

[[Page 10353]]

  Even under the Paul Ryan scenario, when compared to our anemic 
economy, the budget cannot be balanced and the debt cannot be 
eliminated until the second half of this century. So it takes over 40 
years, given that scenario, to balance the budget and eliminate the 
debt. However, that is the kind of slow glide path that we have to take 
with an economy this anemic, and in a way that does not raise taxes.
  And if we learned anything from the Japanese in the 1990s, it was: 
You don't raise taxes during a recession. That is what slowed and 
retarded their growth out of their economic slump.
  Mr. AKIN. That's a great point. And let's repeat that. What you just 
said was, you don't raise taxes during a recession.
  And what we are going to talk about here tonight--there are some bad 
assumptions that were made that are destroying our country and that are 
destroying our budget, our economy, and just killing jobs in America 
and creating a whole lot of hardship.
  But it doesn't have to be that way. There is potentially good news. 
But we just have to follow the principles, just like airplanes follow 
aerodynamics, we have to follow the principles of economics. And one of 
those--you just got to the bottom line--is, you've got to ease off on 
the taxes. And there is a logical reason for it.
  Let's just take a look, though, so people understand the gravity of 
what we are looking at. This is who owns our debt. This debt is created 
because we are promising all kinds of benefits to American citizens, 
all kinds of promises that we are going to give them health care and we 
are going to give them housing and food and education and all the stuff 
that the Soviet Union also promised their citizens. And who is picking 
up the tab? A lot of foreigners are buying our debt.
  Here it is. Foreign holding of American debt was 5 percent in 1970. 
That was when I graduated from college. Foreign holdings, 1990, 20 
years later, go from 5 to 19 percent in 20 years. Now, 20 years later, 
in 1210, foreign holdings, 47 percent.
  Is that healthy? How much longer are the Chinese and the other 
foreign countries going to continue to pay us money that we don't have 
to pay off American voters just to keep them happy? This is a glide 
path that will end up in a crash.
  The gentlewoman, Congresswoman Lummis, has suggested that, even now, 
trying to pull this thing out is going to take a number of years. This 
isn't something that can be turned around overnight.
  And I think this 20-year kind of pattern reflects the fact that what 
we are talking about is really serious here, but it still is basic 
economic principles.
  Mrs. LUMMIS. In May of this year, we issued some Treasury bonds, and 
the sale was undersubscribed, which means there were not enough 
countries or individuals who purchased U.S. treasuries, our debt, at 
the price at which they are being offered, which means that pretty soon 
we are going to have to raise the interest rates that we are willing to 
pay people who purchase our debt.
  When we have to raise our interest rates, that means that we are 
paying more in interest on the debt every year. That crowds out private 
investment from our economy. That makes it more difficult for the 
private sector to create the jobs that were on this chart earlier. That 
is part of the death spiral that we have been talking about.
  Mr. AKIN. I would like to yield a little time to my good friend from 
Georgia, please, Dr. Broun.
  Mr. BROUN of Georgia. Thank you.
  And I like this cartoon that you just put up, because this just shows 
what is going on here, not only with our debt, with health care reform.
  I call it ``tax-and-trade'' because it is about revenue. The 
President himself said it was about raising more revenue for the 
Federal Government. It's not about the environment at all. In fact, a 
lot of what the President has said, he has admitted it is not about the 
environment. It is about revenue and a bigger government, greater 
control, central planning from Washington, D.C., and then the war tax.
  They are adding tax after tax, and we are expecting the Chinese to 
buy our debt. In other words, we are spending our children and 
grandchildren's future, and the credit card is being held by the 
Chinese.
  And it is something that is totally unsustainable. And what it is 
going to do, long term, is our children and grandchildren are going to 
live at a lower standard than we live today because this is totally 
unsustainable, totally unsustainable.
  Mr. AKIN. I think you're an optimist. I really do. I'm not so sure 
that our children and grandchildren will live at a lower standard quite 
the way you're talking about. I'm not sure that this is not going to 
create a more catastrophic kind of crash, where the whole credit system 
of the United States--if your Treasury bill is no longer any good, you 
have, by definition, just crashed your airplane into the ground and 
it's going to ruin your whole day.
  You are talking about a crisis unlike anything we have seen ever in 
our history. That is what is potentially there. I don't think we should 
be overly dramatic about it, but this is really serious stuff.
  And what this cartoon is trying to point out is that there are a 
whole series of Obama policies; every single one of them is diving the 
plane faster and faster toward the ground.
  First of all, there was the Wall Street bailout. Then there was the 
stimulus bill, which was supposed to create jobs. We saw how well that 
has worked. The private job creation is in the dirt, and we are 
creating all the jobs by hiring government bureaucrats who are paying 
more than the poor guys working in the private sector. That doesn't 
work.
  And then you've got this cap-and-trade. ``Cap-and-tax'' is what I 
call it. It was passed out of the House. What a mess that is. I am an 
engineer by training. It is supposed to save us from global warming, 
but all it is, is more big government and more taxes. Fortunately, the 
Senate is not dumb enough to have passed it yet.
  And then you've got, of course, the socialized medicine deal, which 
surely will break the budget unless they put in enough waiting lines 
for everybody and enough rationing so that it won't break the Federal 
budget.
  So all of these policies together are creating those numbers and 
those graphs that we see.
  Mr. BROUN of Georgia. Will the gentleman yield before you take the 
chart away?
  Mr. AKIN. I do yield.
  Mr. BROUN of Georgia. Well, there's a bull that's in that china shop 
that's not indicated in this cartoon, and that's the abject failure, 
non-stimulus bill, as I call it, which has been an abject failure. The 
non-stimulus bill has been an abject failure, and it's going to be a 
job-killer.
  Everything that this administration, that this leadership in Congress 
today is doing is killing jobs. And it's not doing anything except for 
creating a bigger government and creating temporary government 
employees. It's creating a lot of jobs here in Washington, D.C., but 
they don't help my State of Georgia. They don't help New York State or 
California or Texas.
  They are creating a bigger central government that's going to kill 
our freedom. And we've got to stop it.
  Mr. AKIN. The thing is, you and I are not talking can tonight, we're 
not talking about tonight something that is speculative or based on 
theory. These graphs are ending in 2010. These are actual numbers. This 
is what has happened, and it doesn't work. It didn't work for FDR, and 
it's not going to work for President Obama and the Democrats. It just 
won't work.
  That is what is happening to employment in the private sector. And 
the red line, of course, is government. And a whole lot of that is 
these census people running around and snooping on everybody and 
figuring out who lives in what house and everything, which, of course, 
makes you feel just wonderful that we're putting those kind of 
government jobs on instead of just killing manufacturing.
  Let's get to the mechanics, though, because all of this stuff, it's 
not rocket science. This is basic, basic economics.

[[Page 10354]]



                              {time}  2015

  I just wish some of the Democrats had run lemonade stands when they 
were kids. They could understand some real simple kinds of economics 
here.
  One of the things, we had a town hall meeting back in my district. I 
thought maybe I am getting too radical, maybe I have been here too 
long. You know that old folk song you have been on the job too long. So 
I asked them. I said, Now, if you wanted to kill jobs, what would you 
do? What are the job killers? You know what was the top of their list? 
Excessive taxation.
  Now, this is a connection that you were making, gentlelady, a moment 
ago, between the taxes and these jobs going down. And of course part of 
what you use the taxes for is to pay for all these public sector jobs. 
So what's the connection here? Why is it that taxation just kills the 
economy? It's not just any taxation, but it's particularly taxation on 
what? On businesses. Why? Because businesses have to have money in 
order to add new processes, come up with new technology, new machines, 
a new building to do something in. They have got to have some money to 
do it with. And if you take it all away by taxing them, you make it so 
that they can't create the new jobs.
  The places where jobs are created in America are largely, 80 percent 
of the jobs, are in corporations of 500 or fewer people, which you call 
medium or small size. A lot of them are just mom-and-pops with, you 
know, 10 people, or five people, or 20 people. That's where the jobs 
are created. And if you tax the people that own those small businesses, 
you say, hey, that guy's making $200,000 a year, we are going to--
that's what Obama said in the campaign, hey, if you are making 250,000, 
look out because I am going to tax you, but anybody under 250, you are 
okay. Of course he wasn't telling the truth, because he had that tax 
that they were pushing on this global warming deal where if you flipped 
a light switch, you would start getting taxed. But aside from that, the 
fact is he wanted to tax heavily the people that own these small 
businesses. Guess what that's going to do to employment? It's the worst 
thing in the world. And then there is some other points, too.
  I yield to my good friend from Georgia.
  Mr. BROUN of Georgia. Well, thank you, Mr. Akin, for yielding. And 
you are exactly right. Not only does excessive taxation kill the 
ability to do all the research and development that you were just 
talking about, but small business can't even buy inventory. So they 
can't sell their goods to consumers. The consumers don't have the money 
to come and buy the goods and services. So it kills the economy. It's 
just very, very simple economics.
  The thing is we are going in the wrong direction. You talked about 
the energy tax that's been proposed, that Nancy Pelosi jammed through 
the House of Representatives here. It's what's called a regressive tax 
because it's going to hurt people on limited incomes and poor people 
the most. It's going to make their gasoline prices go up. In fact, I 
have heard many Democrats, many Democrats here on the floor of the 
House of Representatives say they would like to see gasoline at $10 a 
gallon.
  Now, somebody who is out working hard today trying to make a living, 
who is just making the house payment and paying their bills and just 
scraping to get by and trying to get by, if their gasoline price goes 
to $10 a gallon, they are going to be just really out of economic luck, 
so to speak.
  Mr. AKIN. How are you going to pay that mortgage payment now?
  Mr. BROUN of Georgia. That's right. They can't afford their mortgage 
payment now, or some are just barely paying those things. And then the 
energy tax on their electricity when they flip on the light switch, or 
when their heating unit comes on, up North particularly. I, thankfully, 
live in the South, so we are more concerned about air conditioning.
  A lot of old people in Georgia and Florida and all through the 
Southeast and through the Southwest are dependent upon air conditioning 
just to live. And if their electricity bills go sky high, as the energy 
tax is going to make it happen, if that ever passes, there are a lot of 
people that can't afford to run their air conditioning anymore. And 
people are actually going to have a hard time with hyperthermia is what 
we call it in medicine as a medical doctor, which means their body 
temperature is going to go up, they are going to get dehydration, and 
people are going to have a lot of problems. And it's going to make a 
greater impact on our health care system and people are going to die 
because of that.
  But it's going to kill jobs too. And it's going to be a job killer 
just like the ObamaCare that's been estimated by experts to kill over 5 
million jobs in this country.
  Mr. AKIN. Five million?
  Mr. BROUN of Georgia. Over 5 million. Five and a half million, to be 
exact, jobs that health care taxes. And what it's going to do, is it's 
going to mean that a small business man or woman who is trying to just 
make a living, they are not going to be able to hire new employees 
because of ObamaCare. We have got to repeal and replace ObamaCare. And 
that's just the bottom line.
  Everything that this Congress has done since I have been here 3 years 
now, everything, and all of it has been under Nancy Pelosi's 
leadership, everything that this Congress has done in 3 years that I 
have been here is going to kill jobs, it's going to kill our economy, 
and it's going to be killing the future of our children and 
grandchildren. We have just got to stop this.
  Mr. AKIN. You didn't even mention that little small detail of the 
government becoming the master. The government is getting so big, the 
government employees are making so much money it's effectively becoming 
not the servant, but the master.
  Mr. BROUN of Georgia. Absolutely. In fact, it's going to kill our 
freedom also.
  Mr. AKIN. I am very concerned about our discussion tonight because I 
am afraid somebody may be watching and they are thinking, oh, my 
goodness, there isn't any hope, things are terrible and bad. Yeah, we 
are in a big financial mess because we have been doing the wrong 
policies. But I want to take about 10 minutes, I want to talk about 
let's wipe the slate clean. Let's stop all of this foolishness and 
let's talk about what we do to fix it. Because we can do that. I want 
to go first of all to my good friend----
  Mr. BROUN of Georgia. Could you yield just a half a second?
  Mr. AKIN. Let's talk something positive.
  Mr. BROUN of Georgia. I am going to.
  Mr. AKIN. Good.
  Mr. BROUN of Georgia. And I want to remind the gentleman that during 
our debate over ObamaCare we were accused as Republicans of being the 
party of no. We are the party of k-n-o-w. We know how to solve this 
economic downturn. We know how to create jobs. We know how to lower the 
costs of health care. We know how to create jobs in the private sector 
instead of Big Government. We know how and are fighting to save freedom 
and to shrink the size of government, get government out of people's 
way so that they can run their lives without all this government 
intrusion. So we are the party of k-n-o-w. And I am excited about your 
launching into this idea about the solutions that we have.
  With that, I yield back.
  Mr. AKIN. I love talking about solutions, because you know what those 
solutions are about? Those solutions are about freedom. And that's a 
good word. And that's what America has always stood for. And that's 
what we need to talk about for a minute. But I do want to yield to my 
good friend, Congresswoman Lummis.
  Mrs. LUMMIS. The Republican Study Committee has a proposal through 
Jim Jordan's subcommittee on the economy that would balance the budget 
in 10 years. It would cut spending in areas other than homeland 
security and defense, and it does not touch Social Security. I am one 
of those who believe that we have to protect our entitlement system by 
reforming it rather than by leaving it alone. But let's save that 
discussion for another day.

[[Page 10355]]

  Another proposal, one that I have with Representative Sam Johnson of 
Texas, would reduce the size of the Federal employment force through 
attrition. In other words, every time someone vacates a position 
through retirement or other means, that position would go into a 
position pool. And only those positions that are absolutely necessary 
to sustain the rolls of government as contemplated by the Constitution 
would be reclaimed and redeployed into the Federal employment force.
  There are any number of ideas. The Paul Ryan proposal, the Jim Jordan 
proposal, this proposal. Jeb Hensarling has proposals, many that are 
comprehensive in nature that will provide that glide path to a better 
economy and do it without raising taxes.
  So even though you hear frequently that the Republicans are being 
shortsighted in the fact that they do not want to consider tax 
increases as part of an economic recovery plan, you are correct that 
most of us don't. And the reason we don't is because we know we can 
recover this economy without raising taxes, and raising taxes will slow 
our ability to recover.
  I yield back to the gentleman from Missouri.
  Mr. AKIN. Thank you for that insight and the wisdom that you have 
shared with us. This is a graph of actually what happens over time. And 
this is this effect I was talking about. You know, when you were flying 
those old-fashioned airplanes and you wanted to not drive your airplane 
into the dirt, what you had to do was push the stick forward, which 
would stop the spin. The plane would start to dive; but when you had 
control, you could pull the stick back. That seemed counterintuitive.
  Pilots for years would get in that graveyard spiral, and they would 
keep hitting the ground until this one crazy pilot said I am going to 
take my airplane up, I am going to put it in a graveyard spiral, and I 
have a solution, I believe, to pull it out of the spiral and live. So 
he bet his life on his solution. And he put it in the graveyard spiral, 
he pushed the stick forward, the plane stabilized, and then he eased 
the stick back, and the plane pulled out, and all the people on the 
ground went, whoa, that was a gutsy move.
  That's a little counterintuitive. When you are out of control going 
down, your temptation is to jerk the stick up, which is what the 
Democrats are doing. They are raising taxes, making the situation 
worse, turning a recession into a depression. And what you have got to 
do is to learn from the pilots who had before you figured out how to do 
it. One of them, ironically, was JFK. Now, that guy's a Democrat, and 
they didn't learn from him. Because he was in a recession and he said 
less taxes, and the economy recovered.
  Then a guy came along by the name of Ronald Reagan. He cut taxes like 
mad. Guess what happened? Recovery of the economy. Then comes along 
Bush. Cuts taxes. Recovery again. I mean, we have seen it over and 
over. Here it is and it's counterintuitive. Why in the world if you cut 
taxes could the government have more revenue and get the economy going?
  Well, here is what happens. And think about it a little bit like 
this. Say you are king for a day, Congressman Broun, you are king for a 
day and you are allowed to tax loaves of bread. And you are thinking in 
your mind now you have been technically trained as a doctor, you are a 
scientific thinker, and you have got these loaves of bread, how much 
are you going to tax a loaf of bread? First you think, huh, maybe a 
penny, because no one will notice a penny tax on a loaf of bread. Then 
you think, yeah, but if I taxed them more, I could get more money. So 
you say, huh, maybe $10. Then you think, ah, no, maybe they wouldn't 
pay $10 tax. So somewhere between $10 and a penny there is an optimum 
tax to tax a loaf of bread to raise money for the government.
  Well, the same kind of thing goes on on a larger scale. And what this 
guy Laffer understood was if you drop taxes, what happens is the 
economy gets going. When it gets going, there are more transactions. 
And so even a lower tax rate will generate more revenue.
  So here is what he did. This is like that airplane. He is dropping 
taxes here, and take a look at government revenues. Government revenues 
are going up and taxes are down. That seems like making water run 
uphill, but it's not. Because when you get the economy going, then a 
lower tax rate actually generates more money. And that's the solution 
out of this problem.
  So let's talk about what is it we have to do. We have to learn, if 
nothing else, from the Soviet Union. The Soviet Union had the 
philosophy that the government is going to give you health care, the 
government's going to give you an education, the government's going to 
provide for your retirement, it's going to give you housing and food. 
The government's going to do all of that. And we laughed. Because we 
said you can't--that socialism, that communism-socialism doesn't work. 
And yet what are we doing here? The same thing.
  We are deciding the government's going to do health care, the 
government's going to do your education, the government's going to do 
your housing, and then the food stamps. It doesn't work. So what I 
think we understand is the government is just going to have to get out 
of the business of taking care of everybody and get back in the 
business of just simply managing the economy, providing for the 
national defense, and they are going to have to push all of that 
decision-making down to the State level and let the States do it. So we 
have to have a good breath of freedom and fresh air instead of the big 
Obama welfare state that we are doing.
  Congressman Broun.
  Mr. BROUN of Georgia. Mr. Akin, I am a pilot, and I want to say that 
you are exactly right about getting out of a death spiral. So we do 
push the yoke forward to stop the spin, to stop the stall, to get the 
airplane flying again. And that's exactly what needs to happen to our 
economy, by pushing the stick forward, by reducing taxes, particularly 
on small businesses.
  I introduced my JOBS Act. My JOBS Act is an acronym for ``jump start 
our business sector.'' It would cut the taxes for business for 2 years. 
It would suspend capital gains taxes and dividend taxes. It would cut 
the two lowest income tax brackets down to 10 percent and 5 percent.
  So if you think about it, that would leave dollars in the hands of 
business, leave dollars in the hands of consumers so that they would 
have the money to stimulate the economy. So it's something that would 
stimulate the economy and start creating jobs. And that is something 
that needs to happen. And it is by cutting taxes instead of raising 
taxes.
  What we see here is our leadership here in the House, the Democratic 
leadership, wants to raise taxes. Our President wants to raise taxes. 
One thing that I want to go back to is something that you talked about 
when the President said he was going to raise taxes on people who made 
$250,000 or more, that these are rich people. The vast majority of 
those folks are small business men and women who are filing their sub S 
corporations as personal income taxes. And those are really not their 
individual income, but that's how much money comes into their business.

                              {time}  2030

  So they're not just wealthy people who are living lavish lives. They 
are men and women who are trying to make a living and create jobs and 
just take care of their families. So when we hear let's tax the rich, 
they need to pay more, actually what you're taxing people is out of 
jobs. You're killing the economy. You're taxing jobs. We need to lower 
taxes, and that's what you're fighting for.
  Mr. AKIN. I really appreciate the gentleman for joining me tonight.
  We, in a way, as Americans have got two choices here. One choice is 
the path to freedom, and the other path is the path of servitude to Big 
Brother government. Every solution that we've seen coming from the 
Democrats--now, we've seen an unusual year-and-a-half. I have been in 
Congress now 10 years. I've never seen a year-and-a-half like this. 
This is a total one-party rule. Almost every bill that passes, 
Democrats

[[Page 10356]]

all vote one way, Republicans the other, and the Democrats have such a 
majority, and everywhere along the line they can do whatever they want 
and they have. And the solution is always more taxes, more government, 
and more government control.
  So, on the one hand, you have the world of the Big Brother government 
taking care of things, and you're guaranteed that you can't fail 
because the government will always be there to bail you out, not just 
as a big corporation but as an individual. You can make bad choices. 
The government will be there to bail you out; that's what they promise, 
but it doesn't work that way.
  In fact, what all of human history shows us is that one of the most 
dangerous things to human beings is big government because big 
government has killed more human beings than all the wars of history 
combined. Just take communism alone, which is a big government theory. 
Just communism alone has killed more people than all the wars since the 
time of Christ, and so this faith in big government is a very, very 
unlikely thing to put your faith in.
  The other choice is freedom, the bright light and the fresh air of 
saying go out and do the best you can; you may fall on your face but 
get up and try again. That's what America was always founded on, the 
idea that government should just protect life, liberty, and the pursuit 
of happiness.
  My good friend, Congressman Broun.
  Mr. BROUN of Georgia. Thank you.
  We have 1 minute left I think, and I just want to say that helping 
poverty is a very simple formula. It's a good-paying job and the 
education to fill that job. That's another thing that we know as 
Republicans. We've got to create those good-paying jobs, and the way we 
do that is in the private sector by reducing taxes on small business 
men and women so that they can create new jobs. We will continue to 
fight for freedom.
  There's a wide gulf, just like you were saying, between the 
philosophies of the leadership of the Democrat Party here and our 
leadership on our side. It is socialism on their hand. On our hand, 
it's freedom, personal responsibility, and accountability, and we're 
fighting for freedom and continue to do so.
  Mr. AKIN. Freedom is a beautiful thing, but we have to realize there 
are a couple of things that come along with freedom. If you really want 
to be free, you're going to have to be responsible as well. You can't 
assume Big Brother government is going to do it all for you. The other 
thing is, if you want to be free, you have to tolerate the fact that 
other people near you may be successful. You have to suffer with some 
guy next door that's made millions of dollars and he gets to get in a 
fancy motorboat and ride around and maybe you'll feel jealous and even 
covetous of him. But that's freedom. You have to allow people to 
succeed, and you have to realize that you can also make a mistake and 
fail but you can have the freedom to get up and try again, but at least 
the government won't chain you down with regulations and bureaucracy 
and red tape and drive you into the dirt like an airplane that's not 
being flown right.
  I thank you very much for joining me, Congresswoman Lummis and 
Congressman Broun.

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