Stimulus Package
Floor Speech
STIMULUS PACKAGE -- (Senate - February 12, 2009)
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Mr. THUNE. Mr. President, I appreciate the Senator from Tennessee yielding and the comments of my colleague from Wyoming in focusing this debate where it should be, on things that are actually stimulus, that actually do create jobs in the economy, that actually do stimulate the economy and create growth and economic opportunity for more Americans.
I would say to my colleague from Tennessee that there are lots of things about this bill that do not meet that criteria, that do not meet that definition. You used the phrase ``timely, targeted, and temporary.'' I would argue that much of the substance of this bill is much different than that. In fact, it is slow, it is unfocused, and it is unending.
Again, we do not know exactly what is in it, unfortunately, because we have yet to see the bill. All we know is it is going to be somewhere in the neighborhood of $800 billion in face amount. When you add in the interest to that--some $350 billion--you are talking about almost $1.2 trillion in obligations we are handing off to future generations.
I think whenever you talk about that, you need to make sure you are understanding what you are getting for that amount of investment and what that means to future generations. For example, a lot of people do not realize or think about the debt we have today. The gross Federal debt is $10.7 trillion. Now, that means that every man, woman, and child in the United States owes approximately $35,000. That is their personal part of the Federal debt. CBO projects the fiscal year 2009 deficit to be $1.2 trillion before--before--any additional stimulus measures are considered. So when you start adding that in, the deficit as a percentage of our gross domestic product will be 10 percent, which is the highest level--the last time we saw that kind of a deficit-to-GDP ratio was back in 1945 when it was 8 percent. That is the amount of debt we are talking about.
I heard my colleague from Tennessee say before that this generation of
Americans will be the first generation of Americans who will not have the same standard of living as their parents. If you think about what we are doing, we are making matters much worse. We have a lot of young people out there who do not have a voice in this debate. I would characterize them as the ``silent generation'' who are not going to be heard. Somebody needs to be their voice in this debate too. Somebody needs to bring some rhyme or reason to what is happening here and hope we can get something reasonable passed through the Senate that is focused on job creation, that is temporary, that is targeted, that is timely--all the things we have talked about should be but this bill is not.
Mr. ALEXANDER. Mr. President, if I could ask the Senator from South Dakota: As I recall, Senator McCain offered one amendment which almost all of us voted for, which was very targeted and cost about $400 billion, but he also offered another amendment which would have guaranteed that whatever was passed actually be temporary.
Mr. THUNE. Yes, that is correct. We had an opportunity to vote on a number of alternatives. The McCain alternative, which you and I both supported, was one that, in my judgment, made a lot of sense because it got you about twice the effectiveness, twice the job creation, at half the cost.
It was focused, as you mentioned earlier, and as our colleague from Wyoming mentioned, on the central issue of housing, which is so critical to bringing our economy back on a pathway to recovery. It also focused on tax relief for middle-income Americans and for small businesses which are responsible for creating most of the jobs in this country. It had an appropriate focus on infrastructure, which many of us agree is an area that can create jobs. It also had a trigger in there, a hard trigger that said when you have two consecutive quarters of economic growth, the spending would cease or would terminate. In other words, when we start to get our way out of the recession, we would actually bring some fiscal responsibility to this debate.
What troubles me about where we are going with this particular bill right now is it does not have that. In fact, much of the spending in here is long term and extends well beyond the so-called period we are looking at in terms of getting some stimulus into the economy. Many of the commitments that are made, many of the obligations will be obligations we are going to experience for months and years to come. Much of the spending in the bill is on what we call mandatory spending; in other words, spending that will be factored into the baseline and that we are going to be responsible for going into the future.
Senator McCain's amendment would have addressed that issue. It would have brought some fiscal responsibility to this proposal. Unfortunately, it was defeated. But that being said, there are lots of things in here that still I think the average American, when they look at this, they will wonder: What is Washington doing, and why are they spending money on these sorts of things?
I am looking here at another proposal: $750 million for the replacement of the Social Security Administration's National Computer Center. Now, that is almost a billion dollars we are talking about, and you have to ask the question: What does this do to create jobs?
How is it that this in any way stimulates anything other than perhaps some jobs in a government agency in Washington, DC? We have $2.5 billion to turn Federal buildings into green buildings; $1 billion for the U.S. Census; $850 million in new subsidies for Amtrak; $650 million in additional funds for digital TV conversion boxes; $645 million for new and repaired facilities at the National Oceanic and Atmospheric Administration; $448 million for the headquarters of the Department of Homeland Security in Washington; $300 million for new cars for government workers; $228 million to the State Department for information technology upgrades; $125 million for the Washington, DC, sewer system; $20 million for the removal of fish barriers. These are all things that are included. I forgot this one: $3 million tax benefit for golf carts, electric motorcycles, and ATVs, provided they don't exceed 25 miles per hour. These are all things that are in this legislation, and I think it would be very hard to convince the majority of the American people these have anything to do with stimulus.
Furthermore, as the Senator from Tennessee has very appropriately pointed out on many occasions, with some of the spending in here, what the States are asking for in terms of assistance--because many of them have shortfalls in their budget. My State is an example of Medicaid now constituting a bigger portion of our State's budget. It was 15.83 percent of the State's budget in 2000, and in 2008 it was 23.33 percent of the budget--a dramatic increase. What we are talking about is sending a lot more money out there. I have heard the Senator from Tennessee talk about it as the States asking for a life raft, and we are sending them the yacht from Washington, DC--
Mr. ALEXANDER. And we are going down to the bank and borrowing the money in their name?
Mr. THUNE.--to do it, almost eight times the amount of money they would need just to cover additional enrollment due to the downturn. Eight times the amount the States would need to get that done is what we are going to be shipping out there and, as the Senator from Tennessee mentioned, borrowing from future generations and piling on to that $35,000 that every man, woman, and child in America already owes as their part or their share of the Federal debt.
This is a very bad direction, in my view, to be heading for the country. I think we have had some opportunities to improve the bill, to make it better. We have had some alternatives offered. The McCain alternative which the Senator mentioned was one that I think, again, was very well balanced, focused on housing and tax relief and infrastructure and had the kind of fiscal responsibility and discipline in it that makes sure a lot of the spending doesn't go on ad infinitum--forever.
So I would concur with the points and the arguments that have been made by my colleague from Tennessee and say that we ought to be thinking not just about today but about the next generation because we have always had a history in this country--for 200 years Americans have sacrificed to make the next generation's lives better, to create a better life for our children and grandchildren. We are asking our children and grandchildren to sacrifice for us. That is a reversal of 200 years of American history. For generation after generation after generation, we have attempted to build a better, brighter, more prosperous future for our children and grandchildren. What we are essentially asking them to do is to loan us $1 trillion to do these things--some of which I mentioned and that I think are just completely outside the realm of anything that fits within the mission of job creation or stimulating the economy--at enormous cost to them because it is going to pile additional debt on top of the $35,000 they already owe, their share of the Federal debt we have today.
So I hope in the end people will come to the realization that this is a mistake and that we will see the necessary votes to defeat it and perhaps go back to the drawing board and put something together that really does, in fact, address the fundamental problem we are facing in the country right now, to get the focus back on housing, to get the focus back on the American people and families and small businesses, and to make sure we are doing it in a fiscally responsible way.
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Mr. THUNE. Again, to my colleague from Tennessee, I thank him for his leadership on this issue and particularly for bringing to the forefront of the debate the housing issue which, as so many have mentioned already, really is an integral, essential part of the solution. If we don't deal with that, then I think we are not going to be able to lead our country out of the recession. I don't think anybody will dispute the fact that housing played a very important role in where we are today, and I think trying to recover is going to require a good amount of focus and attention on that issue which, in this bill, is very light. In fact, if you look at what is included in the bill--let me see--1 percent of the Senate bill goes toward fixing housing. Even the $15,000 new home buyer credit that was reportedly cut in half in the final version of the bill, I am told--and I don't know the answer to this because I have not seen the final bill, nor, I don't think, have any of us seen the details in it--that entire housing tax credit may, in fact, be gone which would eliminate any commitment to helping to repair that aspect of our economy--the housing sector of the economy--which I think is going to be so important in helping us to recover.
So 1 percent of the Senate bill goes toward housing currently, 2.3 percent of the Senate bill goes toward small business tax relief, and, as I mentioned before, small businesses create two-thirds or three-fourths of all of the new jobs in our economy. It seems to me at least that ought to be a very proper and important focus of this legislation.
Of course, some of the alternatives we voted on last week, one of which was the McCain alternative which we referenced earlier, did include a significant amount of incentive for small businesses to invest and to create jobs. I offered a couple of tax amendments to a couple of alternatives to the bill which really did focus on tax relief for middle-income families and for small businesses. That, of course, was defeated as well.
I guess my point is, the bill as we have it in front of us is going to be very much oriented toward spending, and spending on government programs and spending which, in many cases, doesn't go away; that isn't temporary, that, in fact, makes obligations and commitments and liabilities well into the future. We talked about up to about $200 billion of funding in the bill being what we call mandatory spending; in other words, spending that is built into the baseline, that isn't temporary, and it is hard to see how that fits into the definition of temporary, targeted, and timely, which was the criteria that was set out by the President and by the Democratic leadership in developing this bill in the first place.
The Senator from Tennessee, when he touched upon the amount of money his State of Tennessee will receive and what the State's need is--and I would repeat what I said earlier, that under this bill, we are not giving States what they have estimated their amount is to cover the increased Medicaid enrollment due to the economic downturn.
We are giving them--if you can believe this--almost eight times the amount of money they would need to cover additional enrollment due to the economic downturn. Why? States, of course, aren't going to refuse it. Which Governor out there will turn down additional resources? It is estimated that States would need about $11 billion in additional funding to cover enrollment-driven growth in State Medicaid Programs.
Under this bill, we provide $87 billion with absolutely no strings attached and no requirements that States get their own spending and fraud and abuse under control. I hope we have pointed out--and we will continue to point out--the ways in which the funding under this bill is being spent. Again, I mention some of the particular earmarks here, much of which go to Government agencies: $20 million for the removal of fish barriers; $300 million for new cars for Government workers; $645 million for new and repaired facilities at the NOAA; and $750 million for the new computer center for the Social Security Administration.
It is hard to argue that these things are stimulus. Perhaps they are needed and, in fact, perhaps ought to be debated, but it ought to be done in the regular order, handled through the normal annual appropriations process, not included in a bill that is being sold to the American people as stimulating the economy and creating jobs. There is little in here I can see that meets that definition.
I want to make a final point with regard to the whole issue of job creation, because the CBO, in a letter dated February 11, 2009, clearly describes the false economic theories behind this Government spending bill. The CBO letter encompasses the majority of the economists' views on this legislation. Specifically, the letter states that beyond the year 2014, this legislation is estimated to reduce gross domestic product by up to two-tenths of 1 percent. The reduction in GDP is therefore estimated to be reflected in lower wages, rather than lower employment. Workers will be less productive because the capital stock is smaller. The legislation's long-run impact on output also would depend on whether it permanently changed incentives to work or save. The legislation would not have any significant permanent effects on those incentives.
Those are quotes from the CBO letter that came out last week. Even the most optimistic CBO projection states that long-run GDP growth will increase by zero percent. Even the most optimistic projection is built on an assumption that all of the relevant investments, on average, would add as much to output as would a comparable amount of private investment.
The Government spending included in the House and Senate bills doesn't change GDP at all due to Government spending crowding out private investment.
Most of us would agree--I think most of us on this side would agree--that we are much better served in terms of creating economic growth and jobs, in seeing that the jobs are created in the private sector, and that we are providing the necessary incentives for investments in new jobs. This bill is very light on the types of incentives that would lead small businesses to go out and invest and do the sorts of things that actually will create jobs and help us recover and build a better and more prosperous future for our children and grandchildren which, as I said earlier, in my view, is in serious jeopardy because of this legislation--primarily because of the enormous amount of borrowing it includes and how much it adds to the debt for every man, woman, and child in America, and $35,000 is that share of the debt. Under this bill, that would grow $2,700 per every man, woman, and child in America.
What we are doing to future generations is wrong, it is not fair to them. This Government needs to learn to live within its means. We need to think about building and sacrificing so that our children and grandchildren and future generations will have a brighter future. That is the way it has always been in this country. It is part of our culture and ethic that we work hard and sacrifice so that future generations can have a brighter and better future. This completely turns that whole history, that legacy, we have as a nation on its head by asking future generations to sacrifice for us. That is the wrong thing to do.
I hope we will reject this legislation and go back to the drawing board and do something that is effective and creates jobs and does work and will give the American taxpayer a good return on their investment.
I yield the floor.
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