Mr. Speaker, it is great to see you in that chair as a member of the Blue Dogs, a freshman member of the Blue Dogs. We are very proud of you. And also I want to thank my friend and colleague from Utah (Mr. Matheson). Mr. Matheson has been…
Mr. Speaker, it is great to see you in that chair as a member of the Blue Dogs, a freshman member of the Blue Dogs. We are very proud of you. And also I want to thank my friend and colleague from Utah (Mr. Matheson). Mr. Matheson has been a solid leader of the Blue Dog Coalition since he arrived here 6 or 8 years ago. And he actually, in the previous Congress, served as one of the Chairs of the Blue Dog Coalition. And I am grateful to him for his leadership and also for filling in tonight. Thank you very much, Mr. Matheson.
At this time, Mr. Speaker, I would like to yield as much time as he would consume to our friend, the gentleman from Kansas, Dennis Moore, who is the cochair of the Blue Dog Coalition. He is the cochair for policy. So I will yield at this time to Mr. Moore.
I want to thank my friend and colleague, Mr. Moore from Kansas, for coming tonight to speak to us on behalf of the fiscally responsible 49-member-strong Blue Dog Coalition. Dennis Moore has been a great leader on this issue in Congress ever since he got here 8 or 10 years ago, and I'm very pleased to work with him.
Mr. Speaker, this whole notion of how we run our government's fiscal matters is not rocket science. The people watching us out in the country tonight understand that they have to balance their budgets in their own households. They have to balance their budgets in their own small businesses. They can't spend more money than they take in. In local governments, if they didn't balance their budgets, if they continuously spent more money than they took in, the people would elect somebody else. It's only the United States Government that doesn't put in place a requirement that it lives within its means.
I think it's time that we fix this. The Blue Dogs will continue to press this issue. PAYGO is one of the tools that we can use to make this happen.
I'm delighted to be joined tonight by other Blue Dog members. There is no member who is more passionate about this issue and more principled on this issue than our friend and colleague from Indiana, Representative Baron Hill.
I would like to yield to Representative Hill now whatever time he may consume.
Mr. Speaker, I know that the viewers can see the passion that exists within Congressman Baron Hill. He is a great Member of Congress. He is a good leader of the Blue Dogs. I am happy to serve with him and to call him my colleague.
He has explained what the PAYGO rule does. It makes us make the hard choices. If money just grew on trees, we could do any program we wanted, but somebody has to pay for these programs, and we either pay for them today or we borrow the money and send the bill to our children, along with an interest bill, down the road. We think that's immoral. We think it's wrong, inherently wrong.
I know Mr. Hill said that the Blue Dogs care passionately about PAYGO and about getting this thing back on track. We went to Speaker Pelosi after the 2006 election and said we would like to do this. We know that we can't get a statutory PAYGO, which is one that goes into law.
As you know, Mr. Speaker, in order for it to go into law, the House would have to pass it; the Senate would have to pass it, and the President would have to sign it. We were assured by some other bodies and the White House that that wouldn't happen.
So we asked the Speaker to at least put a rule in place in the House of Representatives that would make the House abide by PAYGO. We knew it wouldn't be as good as statutory PAYGO, but it would, in some ways, serve the same purpose. It would be a rule for which the House would have to take a two-thirds vote. Even though it would only apply to us in the House, the House would have to take a two-thirds vote to waive that. She agreed to do that, to her credit, and she is a great advocate of the PAYGO principle.
I am grateful to her and the Blue Dogs are grateful to her for her position on PAYGO.
Now, we would like to see PAYGO become part of the law, like it was back in the 1990s. PAYGO, along with discretionary spending caps and other tools that were used, enabled us to dig out of a hole back in 1992, the largest deficit in the history of the Nation at that time, $290 billion.
Congress, working together with the White House, and in the 1990s, that was mid-1990s and late 1990s, that was a Republican-led Congress, and a democratically controlled White House, working together in a bipartisan way, put in place statutory PAYGO, discretionary spending caps and other budget enforcement tools. This enabled us to dig out of that big deficit hole, $290 billion in 1992 is what we were borrowing to operate this government, $290 billion.
For the efforts of the Congress and the White House in the 1990s, tools were put in place. We had an economic turnaround and, lo and behold, the next thing you knew all kinds of good things were happening.
In 1997, Congress put in place The Balanced Budget Act. I had just gotten here as a brand-new freshman, and I was very fortunate to be a part of the Blue Dogs in some ways, and in some minor way involved in helping President Clinton and the congressional leadership get the votes to pass that budget, The Balanced Budget Act.
That was an important act in 1997, and statutory PAYGO, the law of the land, paying your bills as you go, don't borrow money to do it. If you are going to have a program, you have either got to cut spending someplace or find a revenue source. That was a good tool, and it served this country well economically, the greatest economic expansion in the history of this Nation during the 1990s, the greatest economic expansion in the history of this Nation during the 1990s. The government was doing its part, acting responsibly in the discharging of its duties and acting fiscally responsible.
So, what happened, $290 billion deficit in 1992, we worked hard together, we cut spending, we put in place the PAYGO rules. Lo and behold, at the end of the 1990s and the year 2000, we had a budget surplus for the first time, as Baron Hill said, for the first time in 40 years, with we had a budget surplus.
The next year, I think it was 1999, we had our first one. The next year in 2000, we had another one, over $200 billion surplus. It was unheard of in recent American history.
Then what happened? We had an election. The economic forecasters were forecasting over a $5 trillion surplus, its projected surplus. Now, it's not real, it's projected if things worked like they were supposed to for the next 10 years.
We had an election, had a new President, and that President and the Congress decided that they wanted to go a different route, as Baron Hill says. Now, they came and met with the Blue Dogs.
I remember Vice President Cheney and the OMB Director, who now is the governor of Indiana, came and met with us. We told them they needed to do three things with that surplus.
Cut taxes, who doesn't want to have lower taxes? We know what lower taxes do for our people. It gives them more to spend on their own families, and it helps economically. Cut taxes, number one.
Pay down debt, number two. Debt was continuing to climb, and we thought it was important to pay that down.
Thirdly, we could see the baby boomer retirement coming right over the horizon, and we knew Social Security and Medicare were in trouble. Let's take some of that projected surplus and use it to fix Social Security and Medicare.
Those were the recommendations that we as Blue Dogs made to the White House and their fiscal team, their budget team. What do they decide to do? They said, no, we can't pay down debt, and we don't have time to fix Social Security and Medicare. We have got to take all the money we can get our hands on and put it in tax cuts. The number back then was about $1.7 trillion. It was projected now, it wasn't real, it was projected. That was like in June of 2001.
September 11, 2001, everybody here listening knows what happened. All those projections, every assumption that went into that rejection went out the window on September 11, 2001.
After the Bush economic plan had been put into place, then what do we do as a government? We just charge right ahead with that economic plan. You have seen a continuation or a return to budget deficits that have set records in the last 3 or 4 years, highest budget deficits in the history of this Nation.
You have seen an increase, as Baron Hill said, from $5.6 trillion debt to the a debt that is expected this year to pass $10 trillion, $10 trillion, trillion with a ``T.'' That's a lot of zeros on the end of it. I think it's about 12. I am not even sure.
So the economic policy is wrong, and the Blue Dogs are going to insist that we do it differently. If we have to take baby steps, if we have to do with a PAYGO rule, we are going to stand tough when it comes to the votes on that rule. We are hopeful that the other Members of Congress, House and Senate and the White House, will come to us on this position of fiscal responsibility.
I will be glad to yield to the gentleman from Indiana.
I thank my friend for those insightful remarks.
May I ask the Speaker how much time we have remaining?
I thank my friend, Mr. Hill of Indiana.
You know, looking back at the 1990s and coming out of an era where we didn't have much fiscal discipline in the 1990s and then to a period where we put in place some tools, I want to cite some statistics to you. Of course, I already talked about one, in 1992 this country had a deficit of $290 billion, deficit, annual deficit. That was the largest at that time in the history of the Nation.
By the year 2000, we had turned that into a $236 billion surplus, which was also the largest surplus in U.S. history. Again, that's about a $526 billion swing in 8 years with good fiscal management.
Actually, President Clinton was the recipient of those PAYGO policies, but he was very involved, and he believed in it. He, working with the Congress, helped write those PAYGO policies. He was also committed to fiscal discipline, however unpopular that trend was back then, but it also, by doing that, fostered very rapid growth in net national savings and investment in this country.
In 1992, the net savings in the U.S. economy, the net savings, by all of its citizens, were only 3 percent. Eight years later, after fiscal discipline and moving from a deficit to a surplus, savings was at a 6 percent level, had doubled, from 3 percent in 1992 to 6 percent in 2000. Actually, you know what these savings are due, they are used to finance investment, domestic investment, and it makes the economy grow and everything works better.
Unemployment, obviously unemployment is an issue that we are all very concerned about today. We saw some figures come out last week, we are now at about 5.5 percent.
In the early 1990s, unemployment was at 7.5 percent. Those fiscal discipline tools were put in place and the government began to act responsibly from a fiscal perspective. By 2000, 8 years later that, the unemployment rate had dropped from 7.5 percent down to 4 percent. Now, you know, we are back up at that time 5.5 percent figure.
Let's talk about jobs. The average annual increase in jobs in America during the 8 years from 1992 to 2000 was during the Bill Clinton presidency at a time when Congress and the President were working together to solve this deficit problem. The average job creation number was 2.8 million a year, an additional 2.8 million jobs a year.
Does anybody, do you have any idea what it has been since the year 2000, since the new administration, since this administration came in? It's actually less than a half a million a year.
You figure all that out over a period of 8 years, it's 15 to 20 million jobs that we didn't create. Many of us think it's because of the deficit problems that exist, the irresponsible fiscal policy of this Nation.
I want to recognize my friend from Georgia again, but I want to close this point by reminding our viewers that PAYGO helped with this economic boom. Fiscal discipline and the conduct of the government's business is an important part of how this economy works. We can increase productivity, we can increase gross domestic product, and we increase employment.
I want to remind you that the economic expansion of 1991 to 2000 was the largest in U.S. history. We can do it again, but we have to start disciplining ourselves, and we have to get away from this notion that we can have every program we want, and we can have every tax cut we want, and we go somewhere else and borrow the money and not worry about paying for those programs.
I would like to yield to my friend from Georgia.
I thank my friend from Georgia for bringing forth that point from the foreign affairs perspective. It is a good and valid point.
Mr. Speaker, we live in the greatest and richest Nation on the face of the Earth. We have 5 percent of the world's population and control 25 percent of the world's wealth. If we are not careful and with poor fiscal management, we will shift a good portion of that wealth to other parts of the world.
A couple of statistics, and I don't know what the trade deficit is today, but we are running huge trade deficits as a result of the oil prices. That trade deficit is ever increasing as a result of the increasing cost of oil because a majority of our oil, more than half of our
oil comes from foreign sources. So that is a very serious problem for us.
I talked earlier about the savings having been 3 percent in 1992 and we moved it to 6 percent, those are American citizens saving their bucks, saving for the future. You know, for the first time since I think maybe World War II, 2 years ago this country had a negative savings rate. That goes directly to the management of our fiscal policy and the performance of the economy. I think that it is sad that we as a nation have a negative savings rate. We need to turn that around and one of the things that we can do as a government is do our job well. Let's identify those functions that we are supposed to do as a government, national security, transportation, education, and environmental protection. We need good strong foreign policy, and there are some other areas. But we ought to be willing and make sure that we perform those functions well, and we ought to be willing to pay for them and we ought not be wasting money.
I agree with many on the other side of the aisle that we can root out some waste. There has to be tremendous cooperation between the legislative body and the executive branch to figure out how to do that because the executive branch obviously operates those agencies that we appropriate money for. So it is their job to operate them and operate them efficiently, and we have an oversight role and we ought to continue to do that.
Mr. Speaker, I want to thank my friend from Georgia for being here and I want to thank the other Blue Dogs who came in and helped today. I see another good Blue Dog in the Speaker's chair now, Representative Space from Ohio, one of our freshmen members, and we are very pleased to see you. You look good up there, Mr. Speaker.