In January 1981, just days after his inauguration as the 40th President, Ronald Reagan made the following observation about Washington: "We've lived beyond our means and then financed our extravagance on the backs of the American people."
Twenty-eight years and four presidents later, Washington hasn't learned its lesson. Congress and the White House are forcing through a borrow-and-spend bill that will cost the American taxpayers, their children and their grandchildren more than $1 trillion. This on the heels of more than $1 trillion in bailouts.
It would appear the only thing that's changed since Reagan's words is the magnitude of the extravagance the taxpayers are being asked to finance.
The package before Congress is touted as a stimulus bill a package to create new jobs and get our economy moving again. But a closer look reveals that the bill's investments will largely follow the beginnings of economic recovery, not stimulate it.
Even a not-so-close look reveals a bill that got caught up in the ways of Washington, loaded with every lobbyist's pet project at the expense of programs and ideas that really could get the economy moving.
Take investments in transportation and infrastructure, which could make a real difference to our economy.
Projects like widening Interstate 94 or building the Stillwater Bridge could be a big boon to our economy and make a significant improvement in the quality of life for Minnesotans. The American Association of State Highway and Transportation Officials reported last year that there are more than 3,000 highway projects nationwide that could be ready for construction within 60 to 90 days. And, those are just highway projects.
While America has watched the unemployment rate creep up, those employed in construction and construction-related jobs have watched it spike higher and more quickly. While it seems axiomatic that investing in transportation and infrastructure would provide new job opportunities for many unemployed construction workers, the truth is the benefit is broader than that.
The U.S. Department of Transportation reported last year that every $1 billion in federal highway investment, when combined with the required state matching funds, supports 34,779 American jobs. Of that, only about 12,000 are actual construction jobs. The rest are in supplier industries or related economic sectors.
Regrettably, the so-called "stimulus" package that was passed by the House last week without my vote paid only lip service to transportation and infrastructure investments.
The $819-billion package included $30 billion or 3.6 percent of the funding for highway and bridge construction. But it included hundreds of billions of dollars for projects that do much less to stimulate job creation or economic growth.
In fact, much was spent to things that you could reasonably say have no stimulative impact at all.
What will $600 million for new federal government cars or $400 million for climate change research do to help you and your family? What will $50 million for the National Endowment for the Arts a 30 percent funding increase for the agency do to help the economy?
I supported a motion on the floor that would have shaved $103.69 billion from the so-called stimulus package eliminating funding for 32 new programs and reducing funding for others and tripled the money for shovel-ready transportation and infrastructure projects.
Unfortunately, a majority of my House colleagues under pressure from the Speaker of the House rejected this motion. Similarly, a majority of my House colleagues again, under pressure from House leadership rejected an alternative package that would have stimulated the economy by putting money back into the hands of small businesses and families across the nation. Among other things, this alternative, which I did support would have:
Reduced the lowest individual tax rates from 15 percent to 10 percent and from 10 percent to 5 percent. In the 6th District, 272,306 filers would benefit from the reduction in the 10 percent bracket alone and 228,926 filers would also benefit from the other rate reduction.
Allowed small businesses to take a tax deduction equal to 20 percent of their income. Nearly half a million Minnesota small businesses each employing 500 or fewer employees would benefit from this.
And provided a home-buyers credit of $7,500 for those who can make a minimum down-payment of 5 percent.
Few things bring more glee to the Washington lobbyist crowd than a bill that's stamped: "Crisis Urgent Action Needed Now."
This so-called "stimulus" package got so bogged down in their pet projects that the real stimulus got shoved aside.