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Public Statements

Fixing The American Economy

Floor Speech

By:
Date:
Location: Washington, DC

BREAK IN TRANSCRIPT

Mr. McCLINTOCK. Well, I thank the gentlelady for yielding, and I particularly thank her for organizing this discussion tonight over the future of our Nation.

The discussion going on right here in these hallowed halls of Congress is exactly the same discussion that's going on around dinner tables, over backyard fences, over coffee at Starbucks.

Everybody understands that our Nation is in great trouble. It's getting in deeper. And I think every citizen realizes that each of us has an important responsibility to play in being part of that discussion.

The gentlelady is quite correct. California is in a world of hurt. It's followed exactly the same policies that this administration appears to be embarked upon. It's probably a couple of years further down the road than the rest of the Nation, which offers us a very important warning of what happens when reckless spending, reckless deficits and reckless tax increases all combine into a perfect storm.

California's unemployment rate is now in double digits. This, a State that was once a golden land of opportunity, a State that used to have a recession-proof economy. It was always the last to see its unemployment rate rise. Now it's the first, and the reason is public policy.

Mr. Speaker, I would like to add to that discussion tonight by broadening the discussion to a number of points that have been made by my friends on the majority side blaming the Bush administration for the Nation's economic woes. And I hope that I don't shock my friend from North Carolina to actually rise to join that chorus in some respect.

We are all painfully aware that the Bush administration increased spending twice as fast as we saw it increase under the Democratic administration of Bill Clinton. The Bush administration's first stimulus bill added $160 billion to the national deficit through tax transfers despite warnings that it would do nothing to stimulate the economy, and it didn't.

The Bush administration's bailout bill last fall added another $700 billion to the Nation's deficit despite many warnings that it would not stabilize the economy, and it didn't. That administration ended with record spending, record borrowing, record deficits and an economy in shambles.

But my question to many of my friends in the majority, Mr. Speaker, is this: If record spending, record borrowing and record deficits is the path to economic recovery, why aren't we already enjoying a period of unprecedented economic expansion? In fact, all of the bailouts and handouts and loan guarantees that have already been enacted add up to over $9.7 trillion, as we pointed out on this floor in the past. That is more than the modern-day cost--inflation adjusted--of the space race, the Vietnamese War, the Louisiana Purchase, the Marshall Plan and the New Deal combined.

The fact is, these policies don't stimulate an economy; they stifle it. And it doesn't matter whether these policies are enacted under a Democrat or a Republican. They don't work.

They didn't work in the recession of 1929, when Republican President Herbert Hoover increased the marginal income tax rate in this country from 25 percent to 65 percent and piled up taxes on imports. They didn't work in the resulting depression of the 1930s, when nearly a decade of Democratic President Franklin Roosevelt's New Deal spending failed to stimulate the economy. And we forget that the unemployment rate in 1939 was actually slightly higher than it was in 1931. And we know from a year of failed bailouts and handouts and loan guarantees that these policies aren't working any better today.

Today we learned that General Motors, despite billions of dollars of taxpayer bailouts, is still going under. Monday we learned that AIG, despite billions of dollars of taxpayer bailouts, is still going under. Mr. Speaker, don't they understand that the sooner that we stop bailing out failed companies the sooner we can begin a genuine economic recovery?

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