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Safe, Accountable, Flexible, and Efficient Transportation Equity Act of 2003

Location: Washington, DC


Ms. STABENOW. Mr. President, I wish to take a moment to comment about the report that was just released yesterday, the White House Annual Economic Report of the President, because I was stunned to see the statements regarding the economic report to the country as it relates to jobs.

I invite any member of the group who put this report together or anyone from the administration to visit us in Michigan and see literally every day now the headlines in the papers. It doesn't matter if you are in Detroit or Grand Rapids or in northern Michigan or southern Michigan; we have headlines about jobs that are leaving this country and going overseas, good-paying jobs, white-collar jobs, blue-collar jobs, service jobs, and manufacturing jobs.

When we look at the report of economic advisers and we hear them saying, "President Bush's top economist yesterday said the outsourcing of U.S. service jobs to workers overseas is good for the Nation's economy," I wonder what nation are they talking about. Whose economy are they talking about? It is certainly not good for our economy when people are losing their jobs.

Let me go on to some of the other statements that are quoted in today's Washington Post:

Shipping jobs to low cost countries is the latest manifestation of the gains from trade.

These were not the gains from trade I was hearing about. I was hearing that we were going to actually be creating more markets to produce more goods and services that would be increasing jobs, not losing jobs.

It says:

Just as U.S. consumers have enjoyed lower prices from foreign manufacturers, so, too, should they benefit from services being offered by overseas companies that have lower labor costs.

It is stunning to me that we would not be concerned about the outsourcing of jobs, good-wage jobs to other countries. I commend any of my colleagues to watch, as I do nightly, Lou Dobbs on CNN with the continuing critique of what is happening to our country, including service jobs.

I have friends and constituents in Michigan who have been in good-paying service jobs who are now unemployed and have lost their insurance, many of them struggling to see whether they will lose their homes as a result of having lost their job. They would not agree with this report. What we are seeing is the assumption that somehow moving out of this country to lower cost labor countries, whether it is goods or services, is ultimately better for the United States. Now think about this for a moment. They are embracing a race to the bottom that will only eliminate middle-class America.

We had a recent situation occur in Greenville, MI, a small community of 9,000 people. There are 2,700 people who work at the local refrigeration plant, manufacturing refrigerators, Electrolux. They added a third shift. They have been productive. They make money. But the company came in this fall and said even though they make money, they make a profit in Greenville, MI, and people are productive, they could make more money if they went to Mexico and paid $2.50 an hour with no health benefits.

Well, I am sure that is true. I am sure any business could make more money if they paid $2.50 an hour with no health benefits. I am sure they could make more money if they paid $1 an hour or 50 cents an hour with no health benefits. My question to the management was: Who will be able to afford to buy your refrigerator? Who will be able to afford to buy our automobiles? Who will be able to afford a middle-class standard of living in this country if this is only about a race to the bottom?

When we look at what is happening in our country today, not only in manufacturing but in the service industry, we see a race to leave the country because instead of having trade policies that encourage a middle class in Mexico, in China, in India, and other places around the world so they bring up their standard of living, so they can have good wages and buy our products, we see instead pressure on our businesses and our workers to lower our standard of living, to lower our costs, and there is a race to the bottom.

This race ultimately will cost us our way of life and our middle class. But that is how we are different and strong. That is why we are the greatest country in the world-because we have a strong middle class.

I am extremely concerned when I see these kinds of statements. In fact, also quoted in this article from the Washington Post is a statement by Franklin J. Fargo, vice president of International Economic Affairs at the National Association of Manufacturers:

It is kind of a flip thing to say when people are losing their jobs.

I would agree with that. It is more than flip; it is outrageous to say we as a country somehow benefit by the outsourcing and the elimination of jobs.

In recent years, companies have shipped out software engineering jobs, data entry, customer service, hospital jobs, as well as manufacturing. We know when we pick up the phone-in fact, I picked up the phone one time to talk to a credit card representative and asked where they were. They said: A facility near you. Well, I knew it was not a facility near me in Michigan, where I was calling from, but it was a facility overseas.

I think often of a friend of mine who goes to my church in Lansing, MI. He is a trained engineer, a very competent individual who has lost his job. He told me he is now working for $19 an hour with no health benefits, that he is now struggling with whether he will be able to keep their home with kids in college. That is very real.

I urge those making statements that losing jobs to other countries is a good idea to talk to somebody who has in fact lost their job and may lose their home, and may not be able to send their kids to college, may not be able to buy that new car or keep the house, the cottage up north, be able to do those things that spend dollars in our economy, buy that new refrigerator. How in the world have we gotten to a point where we do not understand the basic economics of people being able to have a good wage so they can purchase goods and services and care for their families and be successful in this country? We know there are serious issues.

Looking at something else in this report, it says: Indeed, outsourcing health care jobs to lower wage countries could help control the upward spiral of health care costs. When a good or service is produced more cheaply abroad, it makes more sense to import it than to make it here.

First, as someone who has worked on health care issues and helped to lead efforts to try to move us to lower health care costs, health care prices, the idea of saying the way we are going to lower health care prices is by losing jobs rather than tackling the big issues of lowering prescription drug prices, rather than allowing Medicare to negotiate group discounts under the new Medicare bill, which we did not do because the prescription drug company wants to be able to stop us from lowering prices-instead of addressing those things that will bring costs for businesses down, the suggestion is we should export health care jobs. So maybe if all of our nurses, doctors, and health care workers were all in another country where they were making less, we would be lowering our health care costs.

I find this report and the comments in it and the public comments in the paper extraordinarily out of touch with what is happening to the people of our country and what is good for our country.

I argue instead that in fact we do need to tackle health care costs. It is a major issue for businesses, large and small. In a global economy, it is a major issue for them to be able to compete. It is a major issue for our families and workers who are being asked to pay more, take a pay cut, pay more in a premium or copays. We should tackle that by addressing what is actually causing the health care costs to go up-the lack of competition, an explosion in prescription drug pricing. If we want to lower prescription drug prices and lower health care costs, rather than having the jobs go to Canada, let us open the border and bring the prescription drugs back from Canada at a cost of 50 percent less. We could do that tomorrow if the administration would look at what is best for our families instead of what is best for the pharmaceutical lobby.

We do not have to export jobs. We can import safe prescription drugs that are actually made here, which we help to produce, that taxpayer dollars subsidize, that are then allowed to be sold in other countries around the world for half the price.

I agree, health care costs are a huge issue for our businesses, and we need to tackle it in a way that brings down prices, that maintains our quality and does not say the way we are going to cut costs is to export our jobs.

As I mentioned earlier, I also ask all of us to rethink what we are doing on trade. We must trade in a global economy, obviously. But our trade laws need to focus on incentives and on policies that will increase the standard of living in other countries, not decrease ours.

I also would ask the administration to work with us on issues to level the playing field. We know China, Japan, and others manipulate their currency. What does that mean? It means it costs us more to sell into China. Our businesses can pay up to a 40 percent tax, essentially, for selling something into China because they want us to move the plant there. It costs us more to sell to them. It costs them less to bring in goods.

If the Treasury Secretary will simply certify that this is going on, we have, then, the authority to begin to do something about it; we have legislation that will give us an opportunity to do something about it. I am proud to be a cosponsor, with Senator Schumer, in that effort.

There are actions we can take to level the playing field. There is no doubt in my mind that if we give American businesses and American workers a fair shot, a level playing field, we will win every time. We can compete when the rules are fair. But instead of addressing those things, we have a report coming before us that says outsourcing of U.S. jobs to overseas workers is good for our Nation's economy. With all due respect, I think they should go back to the drawing board and try this again.

I would just say one other thing. The Annual Economic Report predicted 2.6 million new payroll jobs by the end of the year. Certainly we would all greatly love to see that be the case. But last year they reported 1.7 million jobs would be created and the year before they said 3 million jobs would be created. Instead, the Nation lost 53,000 payroll jobs last year, according to the Labor Department.

Instead of proposing, and suggesting, and proclaiming millions of new jobs without the right policies to actually make it happen, I hope we will place on our agendas the loss of jobs-manufacturing jobs, service jobs, professional jobs-happening in this country, all across our Nation, and certainly in my State of Michigan, where we have paid dearly for policies that have not worked. I hope we make this our top priority and that we focus on those things that will stop the exodus from the United States and the exporting of American jobs around the world.

The PRESIDING OFFICER. The Senator from Florida.

Mr. NELSON of Florida. Mr. President, I say to the Senator from Michigan as she was commenting about this report about how sending jobs out of the United States is going to help with the cost of health care here in the United States, that is as ridiculous as the old medical practice, 200 years ago, of curing the patient of his disease by bleeding him.

Ms. STABENOW. That is right.

Mr. NELSON of Florida. What we need to do about the cost of health care is get to the cost of health care. The cost of health care is going up. Technology has brought us miraculous new medicines and procedures. All of that is going up. But where do you have an opportunity to bring down the cost of health care? You do it by having best business practices that allow you to have the economies of scale, ergo health insurance, the largest possible pool of people. You use the principle of insurance to work for you, which is take the health risk and spread it over the largest possible group so you bring down the per unit cost.

But we are not approaching it that way. We divide up the population in these little narrow categories and then, when that category gets sick and it gets older, what happens to the costs of that health care? It goes up to the point they cannot afford it.

Ms. STABENOW. That is right.

Mr. NELSON of Florida. Or what about what we did in the Medicare bill here, the prescription drug bill, for which the Senator from Michigan and the Senator from Florida certainly didn't vote.

Ms. STABENOW. Right.

Mr. NELSON of Florida. What it was billed as was a $400 billion bill for prescription drugs. We now find it is $525 billion over 10 years. And where did it go mostly? As a bailout to the pharmaceutical companies and as a bailout to the insurance companies.

Ms. STABENOW. That is right.

Mr. NELSON of Florida. Not in a way of providing a direct benefit. When the senior citizens in the State of Florida find out how meager this benefit is, when it kicks in in 2005, I predict senior citizens are going to be somewhat upset.

I thank the Senator from Michigan for her comments.

Ms. STABENOW. If I might ask a question of my friend from Florida, as a former insurance commissioner, he certainly understands the insurance side of this. I think, first of all, he is absolutely right. I think the two major drivers for health care now are the explosion of prescription drug prices and the fact that every time a person loses his or her insurance and that person walks into an emergency room to get care and is sicker than they otherwise would be, and so on, people with insurance end up seeing their rates go up because there is a smaller and smaller group of people who actually have insurance, and they pay more and more. Wouldn't that be the philosophy?

Mr. NELSON of Florida. That is correct. There are 40 million people in this country who do not have health insurance. But they get health care. They often get it, as the Senator suggests, at the time of the emergency. Where do they get it? They get it in the most expensive place, the emergency room. Instead of treating the sniffles, they wait until it becomes pneumonia, so the care becomes so much greater.

So you have to get that much larger a group and ensure that larger group. Do it in the private sector. That is the way it ought to be done. Let there be competition to get your most efficient health insurance product, and then give the consumers, also, a choice of plan. So if they want a Cadillac plan, they can take that. If they want a Chevrolet plan, they can take that.

But mix all of those elements into it. That is how we are going to get health insurance and health reform. But we are not going to until we get to such a crisis because there are so many players who have so much at stake and there is so much money to be made.

Ms. STABENOW. If I might ask my friend another question, wouldn't he share my amazement that, in this new economic report, the proposal is that the way we lower health care costs is to export the jobs? Export the nurses, export the doctors, radiological assistants, whoever it is-that is how we should bring down health care costs? Lose our jobs to other countries? Does that make sense?

Mr. NELSON of Florida. That is exactly the opposite of what ought to be done. What was that report the Senator cited again?

Ms. STABENOW. This report actually is the new report from the economic advisers to the President on the state of the economy and jobs, where they are saying outsourcing to other countries is, in fact, a good thing and, in fact, outsourcing health care jobs will actually bring health care costs down.

I was stunned at what I was reading. Certainly, it is not something I know the people in Michigan are going to be very happy to hear about.

Mr. NELSON of Florida. What has happened to our world today? It is almost, if one person says it is white, another person says it is black; if a person says it is up, another person says it is down. Where is common sense? Where is reconciliation? Where is consensus building? Where is bipartisanship?

Take another issue. As I continue to have this dialog with the Senator from Michigan, take another issue, take the issue of the so-called independent commission that has just been appointed to find out what went wrong with intelligence. How can a commission be independent when it is just appointed by one authority, i.e., the President, who is going to be part of the subject of the investigation of the commission? That is not independence. What we need is a commission that is truly independent, that is appointed by the Congress and the President.

Ms. STABENOW. Absolutely.

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