The Economy

Floor Speech

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Mr. DURBIN. Madam President, this morning we learned that the Republican leaders of the House of Representatives and the Senate have done something which may be unprecedented. We are searching for some example in the past when this has occurred, but we have learned today that the Republican leaders of both the House and the Senate have sent a letter to Federal Reserve Chairman Ben Bernanke ahead of the central bank's 2-day meeting that begins today. That letter to Chairman Bernanke from the Republican congressional leaders instructs him as to what they should try to achieve during their 2-day meeting.

A former Commissioner of the Federal Reserve said this is outrageous; that an independent agency such as the Federal Reserve, which is operated with independence of political impact and political pressure over the years, would now be receiving direct political communications from the Republican leaders.

What is the message from the Republican leaders to the Federal Reserve? The message is, don't lower interest rates. I don't know if Senator McConnell, Senator Kyl, Speaker Boehner, or Congressman Cantor have been home lately. But if they have been home and met with local businesses, small businesses, they will have learned very quickly that it is very difficult for them to borrow money to sustain and expand their businesses and to hire more people.

As we have a monetary policy which allows expansion of these businesses and expansion of jobs across America, we have an opportunity to try to put this recession behind us. So what is the message of the Republican leaders to the Federal Reserve Board? The message is clear and simple: Do nothing. Stand by the sidelines and watch this economy languish.

It is the same message the Republican leaders are sending the President of the United States. He came to us almost 2 weeks ago and said: We have to move together to make this economy stronger. We have to find a way, working together, to create jobs. The President said: Let's give to working families across America a tax cut, a payroll tax cut. The average family in my State of Illinois will receive about $1,500 a year. This will help those families who are working but struggling from paycheck to paycheck.

The Republican response to them: No. They have said to the President they will not accept a payroll tax cut for the working families and middle-income families across America.

The President said: Let's give to businesses across America some help. Let's reduce the payroll tax. In fact, let's create a tax incentive for these businesses to hire unemployed workers.

We know there are plenty of people out there who need work. Some businesses, with an enticement through the Tax Code, may be able to finally hire that extra worker and reduce the unemployment rolls.

The Republican answer, again, is no. Time and again, when either the Federal Reserve Board or the President or, in fact, any economist suggests that we need to move forward as a nation to deal with the recession, the answer from the Republican side of the aisle is no.

Now, with this letter to the Federal Reserve, the Republican congressional leaders are telling the Federal Reserve, we believe for the first time in history, that they should not provide a vehicle for expansion by lowering interest rates in this economy.

That, to me, is wrongheaded. When I think of the businesses looking to borrow money, when I think of those homeowners who need to refinance their homes, interest rates are critical to the expansion of this economy. Time and again, the Republican approach to this economy has been simply stated in just a few words: Do nothing and protect the millionaires.

When the President steps forward and asks the wealthiest among us to pay something more in terms of their own taxes, which is only fair, the Republicans cry foul, class warfare, and all the words they have used to defend their position defending millionaires across America. Most people across American understand we are going to need to have shared sacrifice to emerge from this recession. A lot of families are making that sacrifice today. Working families and middle-income families have been falling behind for a long time. We want to help them with a payroll tax cut and by creating some life in this economy that creates new jobs.

Unfortunately, we have no help coming from the Republican side of the aisle. The President believes, as we do, that putting workers back on the job while rebuilding and modernizing America is the best way to see us through this recession. He believes there are pathways back to work for Americans looking for jobs. He wants to restructure the unemployment compensation program using some innovative techniques that have been popular in the past with Republicans but now are being rejected because the President offers them--an idea that has been suggested of allowing some unemployed workers to come back to work and still draw unemployment so they can have valuable work experience and perhaps find a long-term permanent position.

Tax relief for workers and families across America--cutting payroll taxes in half for 160 million workers--is going to be a break they need. Many of these workers and working families are struggling with high gasoline prices. Does $125 a month mean that much to a Senator or Congressman? Maybe not. But if you are living paycheck to paycheck and you just saw gasoline go over $4 a gallon, $125 is absolutely essential so you can make it back and forth to work and do what is necessary for your family. The President's payroll tax cut will help these working families, and Republicans oppose it.

This plan also has deficit reduction. The President understands, as we all do, that the deficit America now faces in our long-term debt needs to be faced squarely. He believes--and I share that belief--we should spend the next year building the economy but make it clear that over the long term we are going to take the actions necessary to reduce our deficit substantially over a 10-year period of time by more than $4 trillion. That is what the President announced when he made his statement on Monday.

He also realizes that while cutting the deficit and reducing America's debt, we have to keep our promise, the promise to Americans who receive Social Security. Twenty-six percent of Social Security recipients have no other source of income. If we talk about cutting those benefits or privatizing Social Security, as many Republicans do, we are putting at risk, literally, the lifeblood of 26 percent of Social Security recipients.

For 70 percent of Social Security recipients, Social Security represents more than half of their income. So they listen carefully as the President says we are going to protect the basic benefits under Social Security. The same holds true for Medicare. Medicare is a program that has been dramatically successful. Don't take my word for it, don't take any politicians' word for it, look at the life expectancy for senior citizens since we passed Medicare in the 1960s. Senior citizens can live independently, with more confidence, and live longer because of Medicare.

We know we have to make changes in this program, but let's do it in the spirit of preserving the basic benefit structure of Medicare. That is essential, and the President has made that clear too. Those on the Republican side who support the Congressman Paul Ryan budget, which would basically hand out vouchers to seniors and say good luck in the insurance marketplace, ignore the reality that as people age they sometimes face medical challenges that others don't have, and they need the benefit and protection of Medicare in years to come.

The President is committed to that. The Democrats are committed to that. It should be a bipartisan commitment.

The same is true when it comes to Medicaid. This is a program across America that is essential in New York and Illinois. Thirty-six percent of all the children in the State of Illinois rely on Medicaid for health insurance. More than half of the babies born in my State are paid for by the Medicaid Program, and 20 percent of Medicaid recipients in Illinois consume 60 percent of the money spent. Most of them are elderly people who are very poor, living on Medicare, relying on Medicaid to stay in a convalescent setting or a nursing home setting.

So Medicaid has to be protected as well. That is a challenge the President and those of us on the Democratic side accept.

The bottom line is, we can move this economy forward in a coordinated, bipartisan effort; use the President's payroll tax cuts, the business tax cuts that are fully paid for; make certain we are dedicated to rebuilding America's basic infrastructure; and make certain, as well, that we take care of our own: the veterans returning from war, 10 percent of whom are out of work today. That is an embarrassment, and it is one that should come to an end immediately. We should work on a bipartisan basis to encourage their being hired.

There is something else that worries me as we come to the end of this week and face a recess for both the House and Senate. The Republican leader, Congressman Eric Cantor of Virginia, has suggested we may be facing another government shutdown threat. It is just incredible that the Republican leader would bring that up as one of the options as we go into this week before recess.

We don't need this. We have faced two previous threats this year from the tea party-dominated Republican House of Representatives. They threatened to close down the government when we passed the continuing resolution. They threatened again to close down the economy when we faced the debt ceiling.

At this moment, this perilous moment in America's economic history, we should not face a government shutdown again, and the Republican leaders in the House should not be suggesting that as an alternative. We need to work together.

The bottom line issue is disaster aid. I think the Senator from New York knows, as I do--in Illinois we have faced these natural disasters; 48 States have this year. Hurricane Irene, I know, did tremendous damage in the State of New York. Earlier this year in the spring the flooding on the Mississippi and Ohio Rivers did tremendous damage in my State of Illinois. We cannot predict when these natural disasters will come, and we certainly cannot predict how much they will cost. Now the Republicans in the House are insisting that we have to pay for every dollar of disaster aid.

What are their pay-fors? Take a look at it. It is a program we created to encourage the creation of manufacturing jobs in the United States, making fuel-efficient vehicles. The Republicans say eliminate it, eliminate a program focused on putting Americans back to work in good-paying jobs, building the vehicles of the future so we can be competitive not only at home but overseas? The Republicans say that is something government should not do.

It is a consistent pattern, whether it is their message to the Federal Reserve to do nothing when it comes to lowering interest rates, whether it is their message to the President to do nothing when it comes to payroll taxes to help middle-income families and business tax credits to put people back to work or when it comes to paying for disasters when they suggest eliminating a program that will create manufacturing jobs in the United States. Time and again, the philosophy of the Republicans comes through: Stand by; do nothing.

We saw it as well when it came to making certain that General Motors and Chrysler survived the crises of the last several years. The Republican position was: Do nothing.

There are many employees whose jobs are at stake when we talk about the automobile industry--all across America. We often think of some of the big names now that we see every day in the news. There are about 3,000 employees of an operation known as Facebook.

There are around 30,000 employees of a company known as Google. There are 200,000 direct employees of General Motors, not to mention the millions who are suppliers and vendors of their products. To me, that is an indication of the shortsightedness of the Republican approach. Ignoring the reality of an automobile industry that needed a helping hand meant, if the Republicans had their way, GM and Chrysler may not exist today. Thank goodness they did not have their way. The President stepped in, made the changes necessary, encouraged the management of these companies to restructure in light of the new economic realities, and the companies survived.

In my home State of Illinois, in Belvidere, we are proud to have a Chrysler facility. I talked to the CEO of Chrysler. He believes--and I certainly concur--this facility has a bright future because the government helped Chrysler through an economic crisis, and now they are restructuring to build for the future. That is the kind of forward-looking view of the economy that we need.

When the Republicans instruct the Federal Reserve Board to do nothing to help the economy, say to the President: Do nothing to help the economy, and then threaten a government shutdown over paying for disaster relief across America, that is shortsighted. It is not consistent with the economic growth we need in this country to make certain we are moving forward.

I yield the floor and suggest the absence of a quorum.

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