Press Conference with Senator Chuck Schumer (D-NY), Senator Robert Menendez (D-NJ) - the Need for and Economic Recovery Package

Press Conference

Press Conference with Senator Chuck Schumer (D-NY), Senator Robert Menendez (D-NJ) - the Need for and Economic Recovery Package

MR. O'SULLIVAN: (In progress) -- benefits that we are losing. Our families, communities and nation cannot afford to keep losing them and expect the economy to improve.

Creating jobs building America -- our roads and bridges, our transit systems, energy systems and our schoolhouses -- can help get our economy back on track, and we can begin quickly. According to the U.S. Conference of Mayors, there are 15,221 badly needed ready-to-go public construction projects that could create more than a million jobs within two years. Hundreds of thousands of those jobs could get off the ground within months.

Construction workers are among the most hurt by the current crisis. They're not asking for a bailout; they're not asking for a handout; and they're not asking for a stimulus check. They're looking for a paycheck. And getting paychecks back in their hands will circulate money quickly throughout communities across our country and leave behind tangible assets for generations to come.

Even without the economic crisis, the need to build America is real. Twenty-six percent of our bridges are in need of replacement or repair. A third of our roads are in less than good condition, resulting in wasted gas and wasted time. Our children are crammed into 220,000 temporary classrooms because of inadequate schoolhouses. We have 3,650 unsafe dams and levees.

Without adequate investment, our country will fall behind in the global economy. Developing nations such as China and India invest 8 percent or more of their GDP in infrastructure, compared with 2 percent in the United States. While our highways and bridges deteriorate, those nations are building state-of-the-art highways and transportation systems.

This is a no-brainer. We can build America, investing in the fundamentals of our country, and quickly create good jobs that will help our economy get moving again. There is work to do in America, and Americans desperately need work. All that's missing are the jobs.

LIUNA and the half-million men and women we represent and millions like them who want to go to work building America every day urge quick passage of an economic recovery program that focuses on building America so that America works again.

I'd now like to introduce Randi Weingarten, the president of AFT and one of the finest labor leaders in this country.

MS. WEINGARTEN: Thank you, Terry.

Now I understand why Senator Menendez made sure to negotiate with Senator Schumer that he went before Terry O'Sullivan. He's a hard act to follow because, just like all of us, Terry thinks with his head and his heart.

And I can't thank -- I can't thank the senators that are here enough. I've worked with Senator Schumer for longer than either one of us will say.

But this is a moment in time. I asked, in a delegate assembly in New York, our members -- December, thousand people there -- "How many of you have kids in your schools, your classes, who know other people who have lost their jobs?" A thousand people, teachers, three- quarters of their hands shot up.

That tells you what Terry has just said (in terms of those statistics ?).

I was in Florida yesterday with Governor Crist, who, by the way, said, as Senator Schumer said, there is real bipartisan support. They need a recovery program in Florida. We've heard the stories of what is happening, and the schools, the schools in some ways are the repository of all these stories, because the schools are not only about creating opportunity for the future. Every time there is a travesty in America, whether it's a hurricane, whether it's 9/11, whether it's this economic crisis, the schools are there as the rock of stability for kids and for their parents. They are the focus of community.

So this current economic crisis affects everyone, either directly or indirectly. And we know that when the economy catches a cold, our schools get pneumonia. Even with Congress's immediate help, there will still be pain, but an immediate infusion of dollars from Congress will help prevent the kinds of Draconian cuts at the state level from which it takes years to recover. In some instances, like a child's education, kids don't get second chances most of the time; they never recover. We saw that in New York's fiscal crisis in the '70s.

We need to invest, and invest immediately but invest wisely, in things that will not just (stem ?) the economic loss, but will improve education and our other public services. So we need to invest in infrastructure, as both senators have said and as Terry O'Sullivan so eloquently just said, building and modernizing our schools as well as our roads and bridges.

We need funds for the states for FMAP that will relieve the pressure that they have, and we need direct education aid so that we don't reverse course in our march to help all our kids get a shot at the American dream. So that means class sizes don't scale to unmanageable levels, that we can focus on maintaining and strengthening the programs that our support our neediest students and the schools that depend so much on these funds.

If we don't pass this economic recovery, we are doomed, as Senator Schumer said, to repeat this -- (inaudible). And those of us who are social studies teachers understand, let's not repeat the bad aspects of our history.

Thank you so much for doing this work right now. And today the American Federation of Teachers, just after this press conference, will announce a nationwide campaign to mobilize our members for this economic recovery program.

Thank you.

SEN. SCHUMER: Well, thank you, Randi. You're a hard act to follow yourself.

We're ready for your questions. Yes?

Q (Off mike.)

SEN. SCHUMER: Well, it's not certain to be in the bill. Some people have proposed putting it in the bill because, as you know, it's something that has to be done.

It does put money in the hands of the middle class, which we are trying to do. That's one of the aims of this package. And it's been difficult to pass in the past.

Yes?

Q (Off mike.)

SEN. SCHUMER: No. Okay, part of it will be infrastructure, which is school buildings. Part of it will be a block grant, which now they have an official word for it -- stabilization fund -- that will go to prevent two things: one, massive cutbacks in teachers and in programs. If the kid in the third grade, or third and fourth grade, doesn't have the kind of programs he or she needs, you never make that up. So it fits into president-elect's goal that we have something to show at the end. In some cases, we'll have a bridge; but in some cases, we'll have an educated student who would be much better educated than with layoffs.

The second part is property taxes. Property taxes are the major tax that most people pay. It makes no sense for the federal government to be pushing money into the economy while the state and local governments are taking money out of the economy by raising taxes or laying people off. It's sort of robbing Peter to pay Paul. It's sort of counterproductive.

But the economists will tell you it doesn't matter who's putting the money into the economy, whether it's federal, state or local; it's money into the economy. So this is supposed to mitigate that. And I think the president-elect and all of us believe that this is a partnership between the federal government, state and local governments, to get the economy going again. You can't just work on one of those cylinders. So that's the purpose.

Q (Off mike.)

SEN. SCHUMER: There's been a general -- I'm not sure it's done yet, but it's sort of going out the door a little bit. There was a basic view expressed by both Democrats and Republicans in the Senate Finance Committee, and I think on the House Ways and Means Committee as well, that a $3,000 credit at a time when the economy is contracting is not going to get people to hire. If you have a company and you're selling fewer shingles, $3,000 isn't going to get you to hire somebody when your sales are shrinking.

So the basic view was, we need to do things to stimulate jobs on the tax cut side and on the business side, but that probably is not the best way to go. You don't get the most bang for the buck.

Q (Off mike.)

SEN. SCHUMER: Well, the bottom line is that most of our candidates talked about the general economic recovery problem. There were only a couple of candidates who actually talked about the TARP in particular. The two that I can think of are not here -- in Georgia and Kentucky.

But the bottom line is very simple. You cannot have the financial system in lockdown. And the problem with the previous TARP vote, I think -- or the TARP bill -- was it didn't have enough conditions. In other words, you need to unloosen the lifeblood of the economy, which is finance. But you ought to do it in a conditional way, so that first, for instance, if money is given to institutions, they start using it to lend and they increase lending; second, that there be real oversight and accountability, that only those who get the money use it -- only those who need the money get it, and they use it well. And third, there was a general view that some of it should go to the fundamental problem, which is real estate, housing.

None of that happened in the first TARP bill, because Secretary Paulson and President Bush were opposed. President-elect Obama has agreed to all three of those conditions, and that's why I think you're going to find some people voting for this who wouldn't have in the past.

I mean, this is not an easy vote, and we know that. Because it's one of those situations that -- it's to prevent a downside rather than create an upside, if you will. And that makes it a tougher vote. But nobody wants to have the downside.

(Timothy ?)?

Q (Off mike.)

SEN. SCHUMER: Yes.

Q (Off mike.)

SEN. SCHUMER: Okay. Almost all of these programs that we're talking about go for a two-year life, whether it's the FMAP, which I think Randi mentioned, or the block grants or the school construction.

The education stabilization fund would be two years. And the hope is that once the economy is moving again, and revenues go back up, so that the states can continue to help fund the school districts, they'll be able to shoulder the load that they were shouldering until last year. It's to fill in the gap in the -- as the economy goes down -- like a bridge. That's -- Randi said like a bridge.

Q (Off mike.)

SEN. SCHUMER: Well, who knows? That would be two years down the road. We'd have to see.

Now, there is -- there is also going to be some increases in certain programs, such as IDEA. I think they're going to get -- we now pay about 17 percent; the federal government's supposed to pay 40. And there is a strong feeling to at least raise that part of the way, maybe to 25 percent or so.

So that would be in addition to the stabilization part.

Yes?

Q (Off mike.)

SEN. SCHUMER: Yes.

Q (Off mike.)

SEN. SCHUMER: Yeah.

Q (Off mike.)

SEN. SCHUMER: Well, let me just say this. First, I do think that Tim Geithner is an extraordinary individual, and there is broad -- there has been broad support for his nomination because at times like this you need someone of his both knowledge and experience.

The Treasury nominee, Tim Geithner, came before the Finance Committee yesterday. He said he had made mistakes. He was very contrite about it. And he said he had fully rectified those mistakes immediately. The general view, not universal, in the committee was that what he had done clearly was not right but was not something that ought to prevent his nomination, and I've heard that from both Democrats and Republicans on the committee.

So I am very optimistic that the nomination will move forward, and I think the nation will benefit by having an economic steward like Tim Geithner at the helm.

Q (Off mike.)

SEN. SCHUMER: Well, I think it may be -- I -- my guess is that there will be two parts of it. One is the Finance Committee side, which deals with some of the issues -- and Chairman Baucus, who is our leader on that issue -- and the other would be the Appropriations side, which deals with the spending, and Chairman Inouye is our leader on that. So either they would be the sponsors, or if it gets combined into one bill, then I guess Senator (Reid/Reed ?) would be the sponsor.

But it's -- what's interesting is, I think every single senator that I know, at least on our side and, I think, many on the Republican side, have -- has had real input into this proposal.

Yes?

Q (Off mike.)

SEN. SCHUMER: I am not aware of any of it being in the stimulus, but the House may be doing something on that.

Thank you, everybody.

END.

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