The Economy

March 13, 2003
THE ECONOMY

Mr. DORGAN. Madam President, my colleague from Illinois has been talking about foreign policy and, more specifically, about Iraq and the use of force. He touched on the issue of North Korea and terrorism.

We do need to have more debate, aggressive and thoughtful debate, about all of these issues. There is no question that North Korea, in my judgment, and in the judgment of many in this country, is an urgent, serious threat to our country. They kicked out the inspectors. And they do have nuclear weapons, at least according to our intelligence officials. They believe North Korea does have nuclear weapons.

The threat of terrorism continues in this country. Homeland security is a top priority. And all of these issues are very important. But I want to speak about an issue here at home; that is, domestic policy, especially this country's economy.

We wake up every morning—for months in this country—hearing the lead story on the news being war with Iraq. It is the lead story every morning, bar none. It is an important story, no question about that. But there are a lot of folks who wake up in this country these days who are out of jobs. Some 8 million people—perhaps more than that, we are told—do not have work.

Madam President, 308,000 additional people lost their jobs last month alone—308,000 people. Do you know who loses their jobs first? Oh, it is not Members of Congress and it is not people who drive big cars. It is the people who know the definition of "secondhand," "second shift," "second jobs." It is the people who struggle at the bottom of the economic ladder. They are the last to be hired and the first to go.

This economy of ours is in trouble. It is time to stop tiptoeing around and pretending about it. We have two Budget Committees meeting now in this Congress. We have a budget submitted by this President that is completely, in my judgment, irresponsible. That is not a partisan criticism, it is just a criticism of a budget that completely ignores what is happening in this country. It is a budget that pretends everything is just fine and all we need to do is keep doing what we have been doing and this country will see its economy come out of the doldrums. That is patently untrue, in my judgment. It is time for us to say that.

Let me talk a bit about this plan and about where we are. There is not a Democrat or Republican way to fix what is wrong with this ship of state with respect to its economy. But there are right ways and wrong ways to do it. And I know that the moment we dare criticize the administration, we have all of these strident voices from the extreme of the political system who say: Well, how dare you criticize the administration or the President.

Look, I think both parties have done plenty wrong in this country's past. But we face an intersection now that is unlike any intersection America has come to in a long time. This intersection is one where we confront both serious, urgent foreign policy problems—Iraq, North Korea, terrorism, and more—and, at the same time, confront very serious problems here at home—an economy that is languishing, without growth, an economy that, last month, saw 308,000 people lose their jobs.

Now just think of one of those. I am not asking you to think about 1,000, 10,000, 100,000 or 300,000—just one, who comes home and says to his or her family: Something happened at work today. I lost my job. It wasn't my fault. I have done the best I could. I am a good worker, but I have lost my job because the economy is not working well. It's soft.
So what happens here in Washington, DC? Well, we act as if none of this is going on. This is a cheering section, to say: Well, things are going to be better. This is not a problem. What are you complaining about?

Let me talk, just a little, about where we are with this economy of ours.

We have a $10 trillion economy in this country. This is the biggest, the best economy in the world. None of us would want to live elsewhere. We are lucky to be Americans, lucky to be Americans alive now. But our responsibility, as Americans, is to nurture, protect, and foster the development of this great country of ours, and that means protecting this economic engine that produces the jobs and the opportunities for the American people.

Now, in May of 2001, we had an economy that economists told us would produce budget surpluses at the Federal level as far as the eye could see. They said: I tell you, we're walking in tall clover here. There are going to be budget surpluses for 10 years, so you all ought to get about the business of providing big, big tax cuts.

President Bush came to town and said: My heavy lifting is to ask the American people to accept big tax cuts. That is the easiest lift in American politics, I guarantee you. I would like to see one politician who works up a sweat asking people to accept tax cuts.

So the President said: $1.7 trillion in tax cuts; that's my plan. I stood at this desk then, and I said: I think we ought be a little conservative. What if something happens? What if we are giving away money we don't get? What if we don't have these surpluses? What if something that we can't predict at this point occurs and these surpluses don't exist? What you are going to do is run into big deficits and have our children shoulder the consequences of this mistake.

Well, I lost that debate. And so a $1.7 trillion tax cut proposed by the President was pushed through this Congress. And guess what. In a matter of months—just a matter of months—we discovered our economy was in a recession. Months after that, September 11, the most devastating terrorist attack against this country in its history; months after that, a series of corporate scandals unlike any we have ever seen in this country; during all of that time, the bursting of the technology bubble and the collapsing and pancaking of the stock market; and during all of that time, the prosecution of a war against terrorism.

You think about that, all of those consequences—a recession, the bursting of the technology bubble, the pancaking of the stock market, corporate scandals, a war against terrorism. All of that combined to create a dramatic difference in this economy. We have far less revenue coming in. And the result is, big deficits.

Here is what we found:

In May of 2001, Mr. Daniels, the head of OMB, said: We are going to have a $5.6 trillion surplus. We had better get about the business of having big tax cuts, he and the President said.

Well, in 2 years, we went from a $5.6 trillion estimated surplus to a $2.1 trillion deficit. That is nearly an $8 trillion change in the economic fortunes of this country. And yet we have people acting as if it is not happening. None of this is happening, according to them.

What is the antidote to this? What do we do? Well, let's ratchet up some more tax cuts. Short of money? Well, then, reduce your revenue stream. So the President proposes more large tax cuts.

I suppose if you don't care about fiscal responsibility, about budget deficits, then you can do that. But the fact is, we have seen this calculation before. I come from a high school of nine. We didn't have higher math, but there is only one way to add one and one that equals two. That is the math book I studied.

The fact is, this administration's budget does not add up. They say increase defense spending, increase homeland security spending, have less revenue, and have a few budget cuts in domestic discretionary programs, and it will all add up. It doesn't add up. They want to pretend that it adds up. The American people know it doesn't add up.

On the domestic discretionary piece, they say let's increase these two big areas of spending: Defense, homeland security. Let's cut taxes. And incidentally, let's cut taxes on average for someone with $1 million a year in income, let's cut their taxes on average nearly $90,000 a year. We can afford that, they say. But, they say, what we will do is take it out of domestic discretionary spending, nondefense. What does that mean? That means what we will do is cut back on title I spending. That is what they talked about in one of the budget resolutions today.

I toured a school about 2 weeks ago. At the library there was a third grader, a young boy, great-looking young kid, looking at a book and pictures. I met him and said hi to him. I came up behind him and tapped him on the shoulder. The principal of the school, after we got out of earshot of the young boy, said: Do you know something about that boy? You can't tell it right now, but that young boy almost died. He was subject to the most severe abuse I have ever seen in a family. He was beaten badly, taken away from his mother because of the beatings. You know he is doing very well now. This little kid has kind of gotten through all of this. He is doing well. This kid is part of the program for the school, the title I funds for disadvantaged kids. That is the kind of investment we make in these kids. And this little boy needed some of that investment. That is what we do with title I, with Head Start. We give these tiny kids who don't have it so good an opportunity to get a head start in education.

With Pell grants, kids who couldn't go to college get an opportunity to go to college. I had a young Native American stand up in a meeting once and say: Mr. Senator, I am an American Indian. I am the first in my family ever to go to college. I am able to be here because I have Pell grants, because we don't have any money. I will graduate from this college, and I will go back to teach school on the Indian reservation which I came from.

He did. That is the value of investing in some of these programs such as education programs for some of these kids. We can just talk about it as if it is some amorphous program that does not mean anything with no names attached, but that is not the case. All of these investments in the lives of young children make a difference. So when we talk about fiscal policy and plans and budgets, it is just too easy for some people who don't understand that there is a constituency out there. They don't have lobbyists in the hallway. There are no 5-year-olds or 6-year-olds or 3-year-olds waiting as we leave the Chamber to say: Please, Mr. Senator, will you help us. They don't have the voices here.

The fact is, just taking one example of what we do that makes a difference in people's lives, in education of children, especially children who haven't had it so good, we have people who just blithely walk around here these days and say: This is not a difficult circumstance to get out of. Give the wealthy some very big tax cuts, spend $675 billion that we don't have, charge it to the kids, cut back on education programs, and cut back on many of the other programs that help people who don't have it so good and call it a day. Have a good night's sleep.

Those who can sleep with those priorities, in my judgment, have a misplaced priority of public service. The priority in this country ought to be, first of all, to have a fiscal plan that adds up so this country's economy has a chance to grow and provide opportunities and jobs for people.

There is no social program we work on that is as important for working people as a good job that pays well. So making this economy work, giving it the opportunity to work, having it add up so people have confidence in the future is critically important. And then at the same time preserving the opportunity for some very important things, whether it is helping family farmers during a disaster, helping young kids get a chance to start in school through the Head Start program—all of those are so important.

We are doing a shadow dance in this Chamber. Everybody here knows this nonsense does not add up, and no one is willing to say it because the minute you say it, people start screaming that you are somehow disloyal to this administration.

I want this administration to succeed. I want this President to succeed. I want him to succeed so this country does well. I want our economy to grow. I want our foreign policy challenges with Iraq and North Korea and others to work out in the right way. I don't come here wanting us to fail. But if we don't stand up and point out the obvious, that we are headed down a path toward deeper and deeper Federal budget deficits with which we will saddle our children, if we don't change course, this country is not going to grow and will not provide opportunities.

I suppose there will be many who will continue this shadow dance that goes on to pretend everything is just fine, but we know better than that. If we were headed towards these deficits with the previous administration, I guarantee you there would be 20 people in this Chamber every night putting blue smoke out the Chamber; they would be so upset about it. But somehow in the shadow of 9/11, we have moved to a circumstance where the most irresponsible fiscal policy I have ever seen proposed is judged to be a yawn by this Chamber.

We have the two Budget Committees meeting, and they are saying: We can fit all this in. We can fit in big tax cuts. In fact, now they say—those so-called conservatives—deficits don't even matter. It is not a big thing to be worried about.

I don't understand what has happened with respect to the relative positions of politicians these days. Conservatives say deficits don't matter? That is a different kind of conservative than I am familiar with. Deficits, of course, matter. Someone has to repay them.

I don't mean to belabor this point, but on top of this fiscal policy that has us now headed towards the largest deficits in the history of our country, take Social Security out of the calculation, and you should. The Social Security surpluses should not be used to reduce the budget deficit. They are trust funds. The President proposes taking all the trust fund and using it, but they ought not. So if you take that out, you have a budget deficit this year of nearly $450 billion. But add to that a trade deficit of over $460 billion this year alone—the highest in human history. This economy is off course. We need to fix it.

We need to stand up for the economic interests of America in trade and begin reducing that trade deficit, because we have to pay that with a lower standard of living in our future. That is not an option. That trade deficit is owed to other countries. You can make an argument as an economist that the budget deficit we owe to ourselves. Nonetheless, we will still have to bear that burden. But our children will likely bear the burden of a 10-year deficit that is put on their shoulders by a fiscal policy that is irresponsible.

We will have a budget debate next week. I will offer amendments. My colleagues will offer amendments. I don't have any interest in deciding that Republicans have the wrong answer and Democrats have the right answer. There are good answers that come from all parts of the Chamber. But the construct of this fiscal policy is just fundamentally wrong and everybody in this Chamber who knows how to add and subtract ought to know that. It is time for us to start speaking about it.

I am perfectly interested in providing tax cuts to the American people when we have budget surpluses. But the tax cuts should be to working families and should be distributed fairly. But at a time when we have the highest deficits, to say let's ignore them and let's have a political construct that increases spending in the largest areas of spending in the Federal budget and decreases taxes with very large tax cuts and then pulls the rest out of it out of some very important things that invest in people in this country, including veterans and Indian health and education, and a whole series of things, that is wrong.

We need to stand up and talk about it. I will speak about it at greater length next week. I wish I could come to the floor and say this is a wonderful fiscal policy. I just cannot. I feel obligated to say this is wrong; we are headed in the wrong direction. We need to fix it as a country. Our children's future depends on it.

I will make one final point. On September 11, when this country was attacked, we were one country. I was proud of President Bush, and one of the best speeches I ever heard he gave to a joint session of Congress. This country responded as one. But this country does not do a service to its future by believing now—a year and a half following that period of time—that voices still, because they don't want to engage in debate over issues that are important to our future, are somehow disadvantageous to our country. We need a robust debate about the right fiscal policy. We disserve our constituencies if we don't bring this debate to the floor in an aggressive way. What works? What will restore economic health to the country? What do we do to improve economic growth, to provide jobs, to get people back to work, and get the economy moving again? Those are the questions we have to ask as we construct a budget and put this fiscal policy together.

I regret I come to say this fiscal policy makes no sense at all and must be changed. I wish that were not the case, but it is. The result of that is I will be here with amendments, as will others, hoping we can improve this fiscal policy for our country's future.

I yield the floor.