[Congressional Record (Bound Edition), Volume 158 (2012), Part 3]
[Senate]
[Pages 3340-3341]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              THE ECONOMY

  Mr. KYL. Mr. President, I come to the floor today to respond to some 
arguments made in a recent opinion article by the chairman and ranking 
member of the Senate and House Budget Committees, respectively. It is 
entitled ``GOP Budget Attacks Misguided.'' The crux of the piece is 
that President Obama has made great progress in improving the economic 
outlook, and it would improve even more if only Republicans would 
embrace his policies.
  The first set of claims I want to respond to relates to the strength 
of the economic recovery. The authors write that ``we've come a long 
way'' since the peak of the recession thanks to ``actions taken by the 
Obama administration'' and have had ``23 consecutive months of private-
sector job growth.''
  To start, I don't think the 12.8 million unemployed Americans would 
agree we have come a long way. Indeed, it has been 2\1/2\ years since 
the recession technically ended, and we are still experiencing the 
weakest recovery since the Great Depression. Growth is anemic, and 
there are 700,000 fewer employed Americans today than when President 
Obama took office.
  Although it has been 3 years since passage of the stimulus bill, 
unemployment has been above 8 percent for the last 35 months. Remember, 
this legislation was sold as a way to keep unemployment below 8 
percent. These are some of the signs that ``actions taken by the 
administration'' are not working to get Americans back to work or 
improving the economy.
  Regarding the claim that America has had 23 consecutive months of 
private sector job growth, the President has been citing this number on 
the campaign trail, averring that 3.7 million jobs were created during 
that time. But the claim doesn't stand up to scrutiny. Those who cite 
it don't account for the role new workforce entrants play in employment 
statistics.
  Economists generally agree that for employment to hold even, about 
150,000 jobs must be created each month to employ new entrants into the 
workforce. These people include those who recently concluded military 
service or family obligations and recent graduates. If we multiply 
150,000 by 23 months, we get about 3.45 million jobs. That means even 
by the administration's own figures, only about 250,000 new jobs have 
been created in roughly 2 years.
  Moreover, according to the Bureau of Labor Statistics, the net 
positive increase in payrolls was above 150,000 during just 9 of the 23 
months to which the set referred. So, yes, it would have been nice to 
have 23 consecutive months of private sector job growth, but that is 
not what happened. Again, we need 150,000 just to stay even with the 
new people entering the workforce, and in only 9 of these 23 months did 
the economy produce that many jobs.
  The second set of claims I want to discuss relates to supposed blame 
on Republicans for the debt and the hampering of a stronger recovery. 
The authors of this op-ed claim that ``while the deficit has remained 
high over the past 3 years, that is largely a result of the policies of 
the previous Republican administration.''
  Let's take a look at the actual deficit numbers. Labeling the last 
three deficits as ``high'' is quite an understatement. According to 
President Obama's

[[Page 3341]]

own budget numbers, in 2009 the deficit was $1.4 trillion. In 2010 the 
deficit was $1.3 trillion. In 2011 it was, again, $1.3 trillion. The 
deficit this year is expected to top $1.3 trillion.
  At the end of the budget window, in 2022, the deficit is projected to 
be $704 billion. The highest deficit under President Bush was $458 
billion, in 2008. Every deficit under President Obama has been almost 
three times that figure--more than double. But President Obama should 
not be accountable for the debt problem? How does that work?
  The President and his supporters like to point out that the budget 
contains $4 trillion in deficit reduction over the next 10 years. But 
most of this reduction is based on new taxes and gimmicks, such as 
alleged ``savings'' from actions that Congress has already taken or 
from ending operations in Iraq and Afghanistan.
  As a USA Today editorial quoted today:

       [The budget] relies on gimmicks and avoids some problems 
     instead of tackling them. . . . Most glaringly, Obama takes 
     credit for about $850 billion in savings from winding down 
     the wars in Iraq and Afghanistan, which were paid for with 
     borrowed money in the first place.

  These were not actual savings. The Committee for a Responsible Budget 
put it this way:

       When you finish college, you don't suddenly have thousands 
     of dollars a year to spend elsewhere. In fact, you have to 
     find a way to pay back your loans.

  Regarding the supposed problem of Republican resistance to demand-
based policies, there is a major misconception that consumption fueled 
by government spending actually creates jobs. This is the stimulus 
myth. It does not. It just inefficiently moves money around from one 
pocket to another or one taxpayer to another. That helps explain why 
the stimulus failed.
  If Americans cannot spend enough money to stimulate more demand, how 
can the Government accomplish that for us? It is our money that is 
being spent. Simply put, demand policies do not work. There have been 
ample opportunities to prove otherwise in recent years. Let's remember 
the President got everything he wanted from Congress during his first 2 
years in office. He has been in office a little over 3 years. The first 
2 years there was a Democratic House and a Democratic Senate. The 111th 
Congress passed all of the demand-based policies he asked for: 
spending, temporary tax credits, tax holidays, the stimulus. Yet here 
we are.
  A better idea is to encourage economic activity and greater 
opportunity through the supply side of the economy. That means reducing 
government consumption of taxpayer dollars and not raising taxes on 
anyone, especially job creators.
  That brings me to the third set of claims involving the notion of 
``balance.'' The authors claim the budget ``calls for a balanced 
approach . . . with everyone sharing responsibility for deficit 
reduction.'' They also note that balance is ``missing from the GOP 
approach.''
  Balance in the Obama budget, of course, means higher taxes. I ask how 
is it balanced to tax job-creating small businesses even more than they 
are being taxed today?
  According to the Joint Committee on Taxation, nearly 750,000 flow-
through businesses--these are the small businesses, the businesses that 
pay their taxes as individuals--nearly 750,000 would be subject to the 
President's proposed tax rate hikes that would take effect on January 1 
of next year. One-quarter of our Nation's workforce depends on these 
employers for a paycheck.
  According to the National Federation of Independent Businesses, up to 
25 percent of the workforce is employed by businesses that will be 
affected by the President's proposed tax hikes. Perhaps job growth is 
so slow because these job creators are skittish because they do not 
have certainty, and they certainly have not for a long time. In fact, 
the only thing they can see is the President's attempts to impose more 
taxes on them.
  The specter of tax hikes has loomed for years and has inhibited job 
growth. If the tax increases actually occur, we can be sure any 
economic growth we might be perceiving will be killed.
  Finally, the authors claim the President ``has demonstrated that he 
was willing to go the extra mile to reach a bipartisan deficit 
reduction agreement.'' I will note that the debt talks fell apart last 
summer because the President dug in his heels and insisted on harmful 
tax increases that Republicans, of course, opposed, for the reasons I 
just noted. When we had another opportunity to do something about the 
debt this fall, the President was not particularly helpful or 
encouraging. Often missing in action, he never participated in the 
process. The plan put forward by the Republican Senator from 
Pennsylvania at the time was the only balanced approach that put 
significant revenue on the table in the context of progrowth tax 
reform.
  The majority whip called it a ``breakthrough,'' but it was never 
enough for the other side. So here we are, still debating this subject. 
So much for the President going the extra mile.
  In conclusion, I would like to say the President's budget is more of 
the same spending, taxes, and debt we have seen for the last 3 years. 
Last year the budget was so unpopular with the American people that the 
Senate voted it down 97 to 0. Not a single member of the President's 
party voted for his budget. The massive amounts of spending, taxing, 
and borrowing in his budget will hinder an economic recovery. In times 
like these we have to focus on growing our economy, not our Government 
and debt.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Arizona.
  Mr. KYL. Mr. President, I ask unanimous consent to speak as in 
morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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