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Mr. GRASSLEY. Mr. President, last week, we learned that the Nation's unemployment rate has risen to 10.2 percent. That is 1 out of every 10 working Americans being out of a job. But the real number is even higher than that. It is really closer to 1 in 6 workers. When you add in people who are underemployed or have stopped looking for work, the unemployment number is almost 17 percent.
According to a weekend article in the New York Times, that is the highest this country has seen in unemployment since 1982. The Times also noted: ``If statistics went back so far, the measure would almost certainly be at its highest level since the Great Depression''--the Great Depression 80 years ago.
After all the bailouts and a $1 trillion stimulus bill, there are still 16 million of our constituents who want to work but are unemployed. In fact, despite the White House's fuzzy math, the real statistics show that the unemployment rate has more than doubled since the President signed the stimulus bill in February. And, you remember, that bill was supposed to be passed very quickly so the unemployment rate would not exceed 8 percent, and here we are today at 10.2 percent the way it is officially reported, but taking all the other people into consideration, 17 percent.
So people kind of wonder why there is some question about all the debt we are piling on our future generations through the national debt. Particularly, it is a legitimate question when people were told the stimulus bill had to be passed ``right now'' or unemployment, then under 8 percent, might exceed 8 percent.
So there are a lot of questions out there, and some of it carries over into the health care reform issues before Congress right now because it is kind of like people were not really concerned about health care legislation in the Congress of the United States even costing $1 trillion or more until they found out all these other trillions of dollars that were being spent to get us out of a recession were not working. Then it is kind of like the health care reform was kind of the straw that broke the camel's back to cause people to lose confidence in Congress using its own good judgment to solve this problem of the recession.
So we have 10.2 percent unemployment officially, more otherwise. That equates to about 7 million lost jobs since the stimulus bill was passed, and despite the stimulus bill's failings, the White House is pinning its hopes on yet another trillion-dollar effort. Now they are using their ``back of the envelope'' calculations to say health care reform is going to save the economy. This picked up about 6 months ago, back in March, when the White House chose to focus on health care reform rather than the economic crisis.
I would like to quote President Obama:
Healthcare reform ..... is a fiscal imperative. If we want to create jobs and rebuild our economy, then we must address the crushing cost of healthcare this year, in this administration.
That is a quote from President Obama.
I want to say, to some extent I agree with him. It is true health care costs are rising at twice the rate of inflation, straining family budgets, and making it difficult for American businesses to remain competitive. Congress should absolutely enact legislation that addresses these issues.
But, unfortunately, the pending health care reform proposals in the House and Senate not only ignore the primary issue of cost, they also put in place policies that are going to cause more Americans to lose their jobs and further damage our struggling economy.
So now to the main point of my coming to the floor to discuss this issue: Whether it is the $500 billion in tax increases or the growing list of Federal mandates in these pending health care reform bills, the pending bills will take our economy in the wrong direction, contrary to what the President said in that speech several months ago when he said that if you want to fix the economy, you have to do something about health care reform. Maybe if the President had proposed his own bill, maybe he would have proposed something that did it, but what we see evolving in the Congress of the United States is not going to solve that problem.
Back in March, again, when the President turned his attention to health care reform, the head of his Council of Economic Advisers, Christina Romer, said--and I have a chart that has the quote:
We know that small businesses are the engine of growth in the economy, and we absolutely want to do things to help them.
Well, I am not sure how the White House defines the word ``help,'' when it comes to getting small businesses back on track and turning the economy around, but I do know President Obama came up to Capitol Hill this past weekend to pressure House Members to vote for a bill that will have a devastating impact on small business in America. If this is what the administration means when they want to ``help'' small businesses, the old phrase, ``With friends like these, who needs enemies'' comes to mind.
The President and Democratic leadership twisted arms and bought support for a bill that the National Federation of Independent Businesses--and that organization tends to be the voice of America's small businesspeople--actively opposed. After the bill passed, the National Federation of Independent Businesses released the following statement about the administration and Congress's efforts to help small business. This is a long quote, so let me read it, but we also have it on a chart here:
Small business owners are outraged.
Let me start over again. This is from the National Federation of Independent Businesses' comments on what happened in the House of Representatives:
Small business owners are outraged. This bill will actually make things worse, not better. With unemployment at a 26-year high, the punitive employer mandates and atrocious new taxes will force small business owners to eliminate jobs and freeze expansion plans at a time when our Nation's economy needs small business to thrive.
It doesn't sound like the National Federation of Independent Businesses and the thousands of members they have throughout the United States appreciate the administration's efforts to help. With the marginal tax rate on some small businesses, especially those likely to expand, rising by 33 percent under the House bill, it is no wonder. Here we have a chart that says this. The green, present level of taxation; the red, how the President proposes to increase taxes to 39.6 percent in his budget; and then we have other things that are still in the President's budget that are kind of hidden. I will not go into what PEPs and Peases are, but they are a hidden additional tax rate that brings it up almost another 2 percentage points to 41 percent. Then we have the last big bar that has everything in the previous two, plus the 5.4-percent surtax that is in the House bill. It is these increased taxes on individuals--because a lot of small businesses file individually, they don't file corporate tax returns--that kills small business, the engine that creates 70 percent of the new jobs in America.
So we have a situation with these potential tax increases, where any business looking to the capital markets will probably find sources of capital chilled by the 70-percent increase in marginal rates on capital gains that occurs under the House bill. We have this chart over here that shows when you add in the capital gains as well what happens. Because capital gains has a great deal to do with capital formation in America, and higher marginal tax rates tend to discourage that.
Some Members might say the National Federation of Independent Businesses' statement was about the House bill, and it was, but bills we have before the Senate aren't much better. The HELP Committee bill has a similar pay-or-play mandate that will cost American jobs, as does the House bill. The Finance Committee bill is filled with tax increases that will directly affect small business owners and their employees, including families who make less than $250,000 a year, which would obviously be a violation of the President's campaign promise that he wasn't going to increase taxes for those earning under $250,000.
So here we have another chart: Health care reform raises taxes on families with more than $75,000 in income. That is because $75,000 is below $250,000, so the President violates his campaign promise. Further analysis by the Congressional Budget Office has shown that small businesses could also face significantly higher health insurance premiums as a result of the new insurance market reforms. We have the consulting firm of Oliver Wyman concluding that the insurance reforms could raise premiums by as much as 20 percent. As more American businesses, big and small, face higher premiums and more taxes, workers will end up suffering.
The Congressional Budget Office has concluded that pending Senate legislation could force about 3 million people out of their employer-based coverage, and that doesn't even include the potential impact of a new entitlement program, a government-run program we call the public option.
All of this doesn't sound like it is helping small businesses or letting people keep what they have, which was another Presidential promise. The bills also make our unemployment situation worse. We are talking about another $1 trillion in spending--$1 trillion we can't afford--that will end up costing Americans jobs.
I wish to quote from a recent article jointly published by Health Affairs and the Robert Wood Johnson Foundation. We have that quote right here. I am going to quote a small part of that article:
Small, lower-wage firms could be among the most affected--
Meaning most affected by the pay-or-play mandate.
Firms might respond by firing or declining to hire workers. Several studies projected the loss of anywhere from 224,000 to 750,000 jobs.
That analysis doesn't even take into account the impact of the tax increases and the new Federal mandates. The people who don't lose their jobs, of course, face lower wages because it doesn't matter whether you are an economist to the far right or an economist to the far left, there is agreement that as health insurance costs increase, wages go down.
As all the new Federal mandates and the regulatory requirements drive up premiums, businesses will be forced to respond by lowering wages. All of this doesn't sound like a recipe for getting the economy back on track.
I wish to review what the pending bills mean for the average worker and our struggling economy: higher unemployment, more than 750,000 jobs lost; increased health insurance premiums, maybe by as much as 70 percent; lower wages, less money in your paycheck; $500 billion in higher taxes for individuals and businesses; more government spending and higher deficits.
The administration and the Democratic leadership can make all the promises they want, but facts are the facts. Congress needs to address health care. We need to bring down costs, improve quality, and create a more competitive market for insurance, but we should do it in a way that makes our economy stronger. Unfortunately, the health care reform bills we have seen so far are bad for the economy and particularly bad for an American worker and particularly bad at a time when there is, at least officially, 10.2 percent of people unemployed and, if you take other factors into consideration as I have already spoken about, maybe around 17 percent unemployed. As the New York Times said, maybe the highest rate of unemployment going back to the Great Depression. This is bad.
So I can only end by saying, as we look to the debate on health care reform and the analyses of these bills that are done by economists, done by advocates for small business, and the impact it is going to make on the economy, I think we ought to take a second look and not make this situation of the economy worse through a bill that ought to be helping the economy. Everybody agrees we may have the best medical care in the world. We don't have a perfect system, and that system needs to be changed, but in the process of doing it, we have to make sure we do not make a bad situation worse for our economy.
Thank you. I yield the floor and suggest the absence of a quorum.
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