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Public Statements

Economic Stimulus Plan

Floor Speech

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Date:
Location: Washington, DC

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Mr. GINGREY. It is my privilege this evening to have the opportunity on behalf of our leadership to take this hour and talk about a number of things, particularly to discuss this economic stimulus package that we are going to be voting on very soon, probably tomorrow. And we will get into that, and hopefully some of my colleagues will join me on the floor.

But, before I begin that discussion, Mr. Speaker, I wanted to take an opportunity to rise and to recognize a great woman who I am blessed to call Aunt Eleanor on her 95th birthday. Eleanor Gingrey Murphy turned 95 years old today, Tuesday, January 27, 2009.

Unfortunately, I will not be able to attend her birthday celebration, but I wanted to take this opportunity, Mr. Speaker, to honor Aunt Eleanor and wish her a happy and a healthy birthday. Eleanor Gingrey Murphy has lived a great life and has been a blessing to both her family and to her community.

She was born on January 27, 1914, to Charlie and Effie Eubanks Gingrey, my grandparents, in Warrenville, South Carolina, just outside of my hometown of Augusta, Georgia. At the time of her birth, she had two older brothers, Bill and my father James Gingrey. About 2 years after her birth, her youngest brother Charles was born.

Just before Aunt Eleanor's fourth birthday, her mom died in childbirth at age 26. My grandfather, Charlie, worked hard as a mail carrier and later as a carpenter to provide for his four children. But times were tough, Mr. Speaker, and the children often had to take care of each other when aunts and uncles were not available. After school, they often roamed the woods, learning the names of wild berries and fruits that were edible, and they would collect them and bring them home for food. Eleanor was left to do all the cooking for the family at an early age; and she must have learned well, for she is a wonderful cook today.

After high school, Eleanor followed her brothers to New York, where they had hitchhiked in their mid teens to search for work. While in the Big Apple, she met Bill Murphy. Bill Murphy, an Irish immigrant who immigrated legally to the United States with his family from Limerick, Ireland. Eleanor and Bill fell in love and were married in 1937 at the St. Rose of Lima Catholic Church in New York City. They had both been working at a little restaurant, Mr. Speaker. Some of my New York colleagues may remember it; I think it was called the Horn and Heart, where you put a little coin in a slot and you could see your food and you pull out a sandwich or a salad or a bowl of soup.

Well, they were blessed with five sons, my cousins, Larry, Billy, Charles, Tom, and Kenneth. Shortly after the birth of their second son, Billy, Eleanor and Bill left New York City, and they settled their family in a little town called Edgefield, South Carolina.

Tragically, my Uncle Bill left this world at the age of 44 after suffering a heart attack while supervising a sandlot baseball game that he had organized among his own sons and the African American neighbors. Once again, Aunt Eleanor was left to care for her family. Her boys were now becoming teenagers. At the time of my uncle's death their ages, Mr. Speaker, were 12, 13, 16, 17, and 19. And, believe me, times were not easy. Eleanor enrolled in nursing school, and she earned her LPN in order to support her family. Her oldest son Larry had to cut short his Navy enlistment to help out at home.

Through the years, Eleanor's family has continued to grow with her love and her support. She now has 12 grandchildren, and 20, and I understand soon to be 21, great grandchildren. Aunt Eleanor is a devout Christian woman who has a deep love for her family. She often remarks how blessed she has been to be able to watch her children become old men. Fortunately, that includes her nephews and niece, of which I am a proud member.

Eleanor Murphy is a remarkable, remarkable woman with a generous and a loving spirit, and I ask all my colleagues on both sides of the aisle to join with me tonight in wishing my aunt, Eleanor Margarite Gingrey Murphy, a happy and a blessed 95th birthday. And I thank you, Mr. Speaker, for allowing me to take the first part of this hour to discuss this wonderful, wonderful woman and to pay my respects to her.

Mr. Speaker, this is quite a week. We are going to be voting tomorrow on a bill that would spend $825 billion to stimulate our economy. I know that we all agree, both Republicans and Democrats, in this body and 100 Senators in the other body, that these are dire economic times. This country is in a deep recession, and something truly needs to be done about it. We need to stimulate the economy, we need to grow jobs, we need to free up credit markets, and we need to do it quickly.

My concern, Mr. Speaker, is that this package is not the right package. Sure, there are some tax cuts in the package and there are some spending programs; but when this was first described, the idea was there would be monies spent for infrastructure projects all across this country, restoration of roads and bridges, money spent on rapid transit and repairing decaying infrastructure. And each State was asked to prepare a list of projects, and States including my own of Georgia laboriously went through this process to find projects, so-called spade or shovel ready projects that we could immediately get started or purchasing right away and getting these projects underway and putting people back to work. And it was an estimate that several hundred billion dollars would be spent on the these projects.

But as this program has developed, and we now today at the 11th hour looking at this bill as it has been marked up on the House side, what we see is far different from what was originally projected. It is not unlike what
happened before the first of the year back at the end of the 110th Congress when Secretary Treasury Paulson came to the Congress, to both the House and the Senate, and said: Look, the sky is falling; we are in dire economic straits. And I have a plan; it is just three pages long, but I have a plan. And I am going to ask you to authorize me to spend $800 billion to purchase something that was referred to, Mr. Speaker, as troubled assets, so the program became known as the TARP program, Troubled Asset Relief Program.

And I am not going to try to get too deep into the weeds of all of this, but the bottom line is that many financial institutions across the country were holding literally 50, 75, in some cases hundreds of billions of dollars worth of these collateralized, securitized mortgages, many of which contained subprime loans that had questionable value, particularly with the value of homes going down, and sometimes the mortgage alone on these homes was worth far more than the value of the home that they represented. But in any regard, that is what the Secretary of the Treasury and the Chairman of the Federal Reserve Board said to us, and that we needed to give them that authority to do it, and to do it quickly.

So, basically, over my vote and many on my side of the aisle, this bill did pass, and $350 billion was spent and spent quickly. But, Mr. Speaker, to this day I don't believe one thin dime has been used to purchase a troubled asset. No. The Secretary of the Treasury, former Secretary of the Treasury made a decision that maybe the British had a better plan, one that was not discussed with us at any time, at any time, as we deliberated and debated that bill. And we finally made some changes to it, and it went from a three-page bill to a 110-page bill, and at no time was there any discussion though of taking that money and literally giving it to the large national banks and regional banks to restore their capital and to purchase stock in these banks, preferred stock, and so the government would literally take an ownership interest in our banking system.

So that is basically what happened. No troubled assets were purchased. And what happened to the credit markets and the ability for a small business man or woman to get a loan from a bank, or indeed a person to get an automobile loan or someone to borrow a little money to send their child to college or get them through that last semester? That money was frozen. There was nothing available. And so this program, to my way of thinking, Mr. Speaker, hasn't worked at all. And it is pretty depressing when it was not even something that we in this Congress had talked about. This was just a decision that was made because the Secretary of the Treasury said:

Well, there is some fine print or a section in the bill that says I have the authority to do this. And he did it.

And so now as we come back for the 111th, and just before President Obama was sworn in for his inauguration on January 20th, former President Bush asked for the rest of the money, so to speak, another $350 billion; and yet, again, no real restrictions on how that money was going to be spent, and no accountability, no transparency. And so we on this side of the aisle, Mr. Speaker, have some real concerns about what we are doing to this country and the amount of money we are spending.

Now, talking about the TARP program, that is a total of $800 billion. And now we are on the eve, literally, of passing another piece of legislation where we spend $825 billion, but some say it will end up being $1.5 trillion, or possibly even more, on a massive spending program that is a far cry from what we were originally told; that is, most of this money would be put immediately to work on spade ready or shovel ready infrastructure projects across this country repairing roads and bridges and some for mass transit. And when we look at the content of the bill and we see things like hundreds of millions of dollars to resod the National Mall and several hundred million dollars for a contraception program, to me, that has very, very little, if anything, Mr. Speaker, to do with stimulating the economy. It just simply does not.

Fortunately, and I commend President Obama for this, there are some tax cuts in this economic stimulus package. But some $80 billion of $250 billion of tax cuts are literally going to people, Mr. Speaker, who currently are not paying any Federal withholding tax. They have no obligation to, because with their income and the amount of deductions, then they don't owe any Federal income tax but they do pay a payroll tax. So this is a refundable tax credit for those individuals, and it amounts to, as I say, approaching $70 billion. And it is really taking money out of the Social Security system and the Medicare system that benefits that group of people more than any other in our population.

A little lesson on Social Security, Mr. Speaker, is that individuals who are eligible for Social Security, who are in the lower income levels, their monthly check on Social Security replaces far more of their income than the monthly check to someone who is a higher income earner. Someone at a higher income level may get 15 percent or less of their income replaced by Social Security; but individuals at that lower income level who pay no withholding tax, their income replacement by Social Security is up to 40 or 45 percent.

And so to literally take that money and take it out of the Social Security system, to me it seems like it penalizes them more than it helps them. That is something that hasn't really been discussed. I haven't heard others discuss it, Mr. Speaker. But maybe we will hear more about that tonight from some of my other colleagues.

There is one most important point that I would like to make. And of course, President Obama very respectfully came to the Republican Conference today. I think he was very forthright with us. I think most, all of my colleagues on the Republican side would agree that the exchange was respectful, sincere and honest. There were honest differences of opinion in regard to what kind of taxes we really feel like we need to stimulate this economy. We Republicans feel very strongly that the tax breaks need to be across the board, that everybody that pays taxes needs to have a tax cut, not have a preponderance of the tax break going to those who currently don't pay any taxes. But most importantly, even more importantly than individual lowering of marginal rates, is to help our corporate men and women, small businesses. I'm not talking about IBM or General Motors or Apple Computer or anybody in that category. I'm talking about small businessmen and women, the ones that, quite honestly, because we goofed up the TARP program, are having such a desperate time getting a loan, a bridge loan to keep those businesses going and to keep the employment rate up in this country. They're not getting what they need. So we feel very strongly that there should be a significant lowering of the corporate income tax rate, maybe from 35 current down to 25 percent.

We feel like that a person who has a 401(k) or an IRA plan, Mr. Speaker, who is under age 59 1/2 and normally would be penalized and have to pay a tax burden for taking money out prematurely from one of those plans, in this desperate year or two, there should be no penalty for withdrawing money out of a 401(k) or an IRA to possibly pay the heating bill or pay for a child's surgery or to ward off foreclosure when they are a couple of months behind on a mortgage payment.

Those are the kind of things that we, on the Republican side, have tried to bring to the committees of jurisdiction that marked up this bill last week, the Appropriations Committee, the Ways and Means Committee and the committee on which I now serve proudly, the Energy and Commerce Committee. And every little amendment, there weren't many, Mr. Speaker, that we got approved in Energy and Commerce last week, lo and behold, when it was all said and done, those amendments were pulled out of the final bill. And so the bill that we are seeing today, which is kind of an amalgam of those three bills sort of put together, maybe rewritten by the majority leader and the Speaker of the House, none of those Republican amendments, those well-thought-out amendments, after a 12 1/2 hour markup, a lot of hard work went into that, and all of a sudden, poof, they are gone.

And so when President Obama was at our conference today, Mr. Speaker, we talked to him about that. And he listened. I think he sincerely listened. He made no promises. But I thought it was a very good opportunity, a very good exchange and a good start. And as he pointed out, we would love to be able to have a bill that we could agree on that had a good chance of stimulating this economy and stimulating it quickly and that we could do it in a bipartisan way.

But for that to happen, Mr. Speaker, he is going to have to make some changes that we Republicans can believe in. Let me repeat that. That has been the motto, ``change you can believe in.'' He, in this bill, to get Republican support, is going to have to make some changes that we Republicans and the people that we represent, literally 48 percent of the population of this country, that they, too, can believe in. And so we can only hope that as this bill is marked up in the Senate, and clearly, the two will not be the same, and ultimately there will be a conference report and some changes will be made. And I hope that President Obama, in working with Speaker Pelosi and Majority Leader Reid, Mr. Speaker, we can work with the Republican minority with our Leader Boehner, John Boehner, a gentleman from Ohio, and the Senate minority leader, Mitch McConnell, a gentleman from Kentucky, that we can get together and this can be a work that we can be proud of that has a good chance of success, that truly we will be pouring water on a fire and not gasoline on a fire.

So with that, Mr. Speaker, I see that I have been joined by one of my colleagues, indeed one of my classmates from New Jersey, a gentleman that has served on the Financial Services Committee, he served on the Budget Committee, and I think he has an understanding of this whole process far deeper than most Members. Let me just put it that way.

And so I'm pleased to have with us tonight my good friend from New Jersey, Scott Garrett. And Mr. Garrett, I will yield some time to you.

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Mr. GINGREY of Georgia. If I reclaim my time just for a second, I hope you will stick with me, I want to hear more from you. But you mentioned the majority CBO, Congressional Budget Office, they came out with a report that said that 7 percent, Mr. Speaker, 7 percent of this money would be spent in 2009 and up to 38 percent by the end of 2010.

So we have this dire emergency and we need spending and we need it right now, and yet only 7 percent of all of these projects are getting into the hands of the people, into the economy, to help grow jobs. Where is the emergency?

Well, I quite honestly, Mr. Speaker, feel there is an emergency. But that is why we take exception to this program and the many things that are in it that really have nothing to do with emergency spending. I mentioned a few of them at the outset. There are others. There are quite a few others.

In fact, Mr. Garrett, I know you would agree with me, Mr. Speaker, I think he would, that when President Obama came to the conference today, he admitted the same thing. He said look, there is stuff in there if I had my complete way, and I am not sure why he doesn't, but he does have to deal, of course, with the legislative branch, that being Speaker Pelosi and Majority Leader Harry Reid on the Senate side, but there are things that I think clearly should be, and I bet my colleague from New Jersey would agree with me, it is just regular spending. Whether we are talking about some of the trillions of dollars on education spending, IDEA, increasing Pell Grants, that is part of a regular process that ought to work its way through the authorizing committee, Education and the Workforce, and let the appropriators appropriate money under regular order. That is not emergency spending. So we have turned this $825 billion emergency spending package literally into a Christmas tree, and it is not going to help, it is not going to get us out of this deep recession. And we need something that is going to work.

I yield to my friend.

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Mr. GINGREY of Georgia. Indeed, Mr. Speaker, and I would say to my colleague that the jobs are being lost today. They are not being lost 18 months from now. God help us if we are losing these kinds of job 6, 12, 18 months from now. We better be growing jobs and not losing 15,000, and I think Pfizer Pharmaceutical announced they were going to cut 15,000 jobs out of their workforce. Apple for the first time in its history I think recently announced a significant job loss. The big three automobile manufacturers, despite the fact that they got what, at least $5 billion, including GMAC, another billion in the first tranche of the TARP money, so these jobs are being lost and lost now. And as my colleague from New Jersey points out, we need to save these jobs, save the ones that we can and grow new jobs, but not 6, 12, 18 months from now but right now.

I wanted to just mention for my colleagues' sake on both sides of the aisle, sometimes it is a little difficult to know what is exactly in these massive bills, particularly one that has been brought to the floor in such rapid-fire fashion without any input really from the minority side, but maybe without much input, if any, from the rank and file of the Democratic majority. But, Mr. Speaker, and my colleagues, including Mr. Garrett from New Jersey, just listen to a few of the things that are in this economic stimulus package: $650 million for digital TV coupons; $650 million for new cars for the Federal Government; $6 billion for colleges and universities, many of which have
billion dollar endowments; $50 million in funding for the National Endowment for the Arts. That is a perfect example of something, Mr. Speaker, that should be funded under regular order. It should be debated and a case made whether or not that needs to be increased or decreased, not thrown in here in the dark of night and said we are going to spend $50 million because it is part of an economic stimulus package. It is not.

There is $44 million for repairs to the United States Department of Agriculture headquarters. What do they need new carpet, retrofitting of their bathroom fixtures? Can't that wait? Is that going to create new jobs? I don't think so.

There is $200 million as we said earlier for The National Mall, including $21 million for sod. I could go on and on. Some might say you are nitpicking, you are just going in there and picking out things that sound and look bad. Believe me, there are others that sound and look a whole lot worse. It is just a recurring theme. So we feel very strongly, and I want to spend some time talking about this because my colleague on the floor with me tonight, Representative Garrett from New Jersey, he and I are both members of the Republican Study Committee, the more conservative 108 Republican Members out of about 175 of us now, in the minority, who have a better plan, we think, for stimulating this economy. We call it the Economic Recovery and Middle Class Tax Relief Act of 2009.

I want to bring out just a few of the things that are in that bill. We have submitted it. I am a proud cosponsor of this bill. I think the original cosponsors, the chairman of the Republican Study Committee, Mr. Speaker, and that would be Dr. Tom Price of my great home State of Georgia, and Jim Jordan, the gentleman from Ohio, and a couple of other members of the Republican Study Committee, but here are some of the provisions.

We would provide an across-the-board tax cut of 5 percent for everybody who pays taxes. Every marginal rate, we would cut 5 percent. If you are paying 10 percent, it is 5. If you are paying in the 15 percent bracket, it is 10. If you are paying in the 28 percent bracket, it is 23. And we feel very strongly about that.

We would increase the child tax credit from $1,000 to $5,000.

We would repeal the AMT. Very quickly, I think the general public has heard enough about this to understand it. I know my colleagues understand it. AMT, alternative minimum tax, which was put in place 25 or 30 years ago to make sure that maybe 125 ultra-rich people had to pay some taxes, they couldn't use legal loopholes with very smart Philadelphia tax lawyers to get out of paying any taxes, and so it had to be calculated in two ways and they had to pay an alternative minimum tax. Well, it was not indexed for inflation and this year come April 15, 25 million middle income taxpayers are getting caught by the AMT, and that should be repealed. It should not have any kind of a PAYGO provision. It is a wrong tax. It was never meant to apply to these 24 million, and it should be repealed and repealed permanently.

We want to make the capital gains tax lower and we want to make the dividends tax rate 15 percent and permanent. We want to increase by 50 percent the value of the tax deduction for interest on student loans and the tax deduction for qualified higher education expenses.

We want to make all withdrawals from retirement accounts tax free, as I said earlier, during the year 2009.

There are a number of other provisions in the bill. I know that my colleague from New Jersey is very familiar with that. I would love to yield to him at this time and we will further discuss the RSC stimulus bill which is called the Economic Recovery and Middle Class Tax Relief Act of 2009 which we firmly believe will get us out of this recession because people will have money in their hands that they will spend and we will not have to worry about this massive bureaucracy throwing $825 billion out the window and hoping that it sticks somewhere.

I yield to my friend.

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Mr. GINGREY of Georgia. This is without a doubt. And I'm glad you mentioned section 179. I think under current law, section 179, Mr. Speaker, of course is that section of the Internal Revenue Code which does allow a small business to expense a certain amount of capital improvement or equipment purchase in the very first year. But it's limited under current law, I believe--Mr. Garrett, correct me if I'm wrong--to about $125,000.

We say, in the Economic Recovery and Middle Class Relief Act of 2009, the RSC stimulus package, that that ought to be expanded. And not only that, but also to immediately cut the top corporate income tax rate from 35 percent down to 25 percent. And my colleagues and my friends, that would just align us with the average rate in the European Union. We're all talking about the European Union and what they're doing on cap and trade and global warming and how we ought to get in line with that--even though it will probably break our economy at a time that we can ill afford to do so--but yet we let them rob our bank, literally, with a more attractive corporate tax rate, and we drive our corporations offshore. That makes absolutely no sense. So there are so many things that we could do with the tax code.

And I want to say one other thing before yielding back to my colleague. You know, I've heard the majority side talk about the tax portion of this stimulus bill, the $250 billion or so worth of tax incentives, and this business of refundability of a tax credit to people for their payroll taxes, people that don't even pay taxes. And the attitude is that, well, the RSC is wrong; you shouldn't cut taxes across the board because people at a higher income level--let's say $40,000, $50,000, $60,000 a year--they won't have to spend that money and they will just hold onto it and it won't get flowing in the economy, it won't stimulate the economy. But these nearly poor and poor people have no choice but to spend that money because they're desperate, they have to spend the money. They can't save it, they can't pay down their debt, they can't put it in a college fund for their child. To me, Mr. Speaker, that is insulting to these people--good, hardworking salt-of-the-earth people--who I truly believe know how to control their money and know when to spend and know when to save and know when to pay down debt and know when to tear up their credit cards. But no, we have this attitude that only uncle knows, only uncle knows and has to make the decision for us.

And I'm just afraid, Mr. Speaker--and that's why I'm opposed to this bill in its present form--I just feel that we're only going to get one shot at this. We are losing too many jobs, the economy is in a severe downturn--I think it's fair to say a deep recession--and we need to give it our best shot. And we certainly don't need to be throwing gasoline on the fire.

And so I yield back to my colleague for some additional comments and then we'll move to close.

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Mr. GINGREY of Georgia. My colleague from New Jersey, I appreciate those figures. And boy, if that doesn't put it into perspective for all of us, Mr. Speaker.

Let me just say this, and then I want to recognize my colleague from Minnesota, possibly, for a minute. But at the end of our conference today, Mr. Speaker, with President Obama, our conference chairman, Mike Pence, the gentleman from Indiana, said to the President, one thing is for sure, you have our prayers. And you have our prayers on both sides of the aisle. We'll be praying for the administration, we'll be praying for the leadership. We'll be praying for the majority and the minority that we can do the right thing for the American people.

I see that my colleagues are leaving. So as I finish up, again, I just want to say, Mr. Speaker, that this issue is much too important for partisan politics, but it is about policy. And if we're going to be--we, the Republican minority--are going to be the loyal opposition, then it is our duty, it's our responsibility to express our concern in a respectful way to the President of the United States, to President Obama, and to Majority Leader Reid in the Senate and the Speaker of the House, Ms. Pelosi, here in this great body, that we have some concerns. We want you to listen to us. We want to work with you. We want to save this economy so that we can help all the American people.

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