Before I give my remarks, let me compliment the Senator from California not only on what she just said but on the remarks she made on television yesterday concerning the danger to our country when people leak information relating to our…
Before I give my remarks, let me compliment the Senator from California not only on what she just said but on the remarks she made on television yesterday concerning the danger to our country when people leak information relating to our effort to defeat terrorists, which makes it all the more difficult for us to accomplish our job, and it undercuts the mission of the many men and women in the military, our intelligence services, and the civilian forces of government and, frankly, in the governments of allies that are working very hard to identify and prevent terrorism from occurring. When leaks such as this occur, it undercuts that effort tremendously. I thought the Senator from California did a very good job of pointing out how that is so and why we have to go after the people who are responsible.
I compliment the chair of the committee for her very wise remarks. I know the ranking member, Senator Chambliss, is in full accord. This is a very bipartisan effort. I hope we can succeed in getting to the bottom of it.
Unemployment
Mr. President, I wanted to talk today a little bit about unemployment and the economy. There have been a lot of news stories--some very serious, as the one we just discussed, and some a little bit more frivolous--that I think are distracting from what I believe is the top domestic problem in the United States today, the lagging unemployment. I wish to focus on that today and what we could do about it versus what we are or are not doing about it. There are troubling economic trends, and I think maybe we can make some recommendations to the President about how we can help to get out of the ditch we are in.
Unfortunately, the administration has been claiming that the economy is continuing to heal and touting the latest jobs report, and I think that misleads the American people, and here is why: It is true that by their measure the unemployment rate has declined from 8.2 percent to 8.1 percent, but that doesn't represent progress if you look behind the numbers. If you look behind the numbers and the actual employment data, employers added only 115,000 jobs last month. That is less than the 180,000 Wall Street was expecting and, more importantly, it is less than the 150,000 jobs that have to be created each month to keep up with the new entrants into the workforce, for example, the kids graduating from college and high school who are entering the workforce. In order to keep up with that number, about 150,000 per month, the private sector has to create that many jobs to stay at zero, and if it doesn't, then we are actually getting behind.
The fact that we have had several straight months where there has been an actual increase in the number of jobs created doesn't measure the success properly. We have to measure those months where job creation was above 150,000, and in that case less than half of the months since the President has been in office have met that criteria. So we are actually sliding backward, not moving forward.
Here is another way to look at the unemployment picture: There are so many people who have given up looking for work under the Obama economy now that they don't show up in the unemployment statistics. That is why this number, 8.2 percent, actually goes down to 8.1 percent, not because there are a lot more people finding work but, rather, a whole lot more people have stopped looking for work so they are not counted in the unemployed looking for work.
In March, for example, there were about three people dropping out of the system for every one job created. Think of that. In April the rate was 4.5 dropouts per new job. So each month we are finding more and more people are simply not looking for work. They are dropping out of that group of people who wish to be employed and who are looking for work. They have stopped so they don't show in the unemployment numbers.
In fact, in the month of April, 522,000 people dropped out of the labor force. Remember, last month 115,000 jobs were created and some people thought that was great. Well, it is nice that it was 115,000 and not none, but the reality is if 522,000 people dropped out of the labor force that same month, it shows there is not much to cheer about. What that meant in terms of overall statistics was that a number that the Labor Department calls the labor force participation rate, which is how many of the people who could be working here are actually working, dropped to 63.6 percent, which is the lowest level since 1981 when we were headed into a big recession at that time. In other words, we have fewer people actually working in this country as a percentage of those who could than at any time since 1981.
James Pethokoukis of the American Enterprise Institute said:
If the size of the labor force as a share of the total
population was the same as it was when Barack Obama took
office--65.7 then versus 63.6 today--the unemployment rate
would be 11.1 percent.
That is why you hear people say the real unemployment rate is not 8.1 percent, it is 11.1 percent. What that means is the more people who give up looking for work, the better the official unemployment number gets, but it doesn't tell the real story. Pethokoukis also noted--and I am quoting:
If the participation rate just stayed where it was last
month, the unemployment rate would have risen to 8.4 percent!
So the unemployment rate is primarily a factor of how many people are still looking for work. And if they have given up, then they don't show in these statistics anymore. This is very troubling because it also shows that Americans do not see their situation bettering; they don't have a sense of optimism that things are getting better. There is a resignation beginning to be created here that things are not going to get better and there is no point in trying to look for work, and of course that has ramifications up and down the economy, a couple of which I will mention here.
Because there is this view that the economy is not continuing to heal, as the President said, we have got very sluggish economic growth. Back at the very same point in the Reagan recovery, the very same point that President Obama is at right now, at that time economic growth was 6.1 percent. Today it is 2.4 percent under the Obama economy.
Social Security disability claims are rising, and they are rising dramatically. What it shows is that instead of people continuing to look for work, they are filing for disability, and a lot of them are getting on disability. We have had a tremendous increase in disability claims and determinations of disability in this country. More Americans are using food stamps than at any other point in our history. One out of two recent college graduates cannot find a job or is underemployed for their skill.
I gave a commencement address on Saturday and talked to some of the students about what they were going to be doing. Most of them had something to do, but a lot of kids do not have a job even though they have spent 4, 5, or 6 years and untold thousands of dollars getting a college education.
Senator Thune recently noted that the poverty rate among women has reached a 17-year high, and that there are nearly 700,000 fewer women working today than when President Obama took office. I don't mean to divide this into gender or any other kind of group, but the reality is that groups in this country suffer when we have poor economic growth and are not creating enough jobs. If you want to get it right down to what kind of people are having a problem, here is a situation: 700,000 fewer women working today than when President Obama took office. There are 22.8 million Americans who remain unemployed or underemployed or who are only marginally attached to the workforce. These are 22.8 million Americans who could be working productively, and if they were, our economy would be doing much better. Guess what would also be happening. People would be earning income and paying income taxes, the government would have more revenue, and we would be better able to afford all of the things the American people expect of the government.
The number of long-term unemployed has increased by 89 percent under the Obama administration. These are the people who have been out of work for a long period of time--at least 6 months and many of them more than a year. And all of this as the cost of living for middle-income Americans soars. For example, worker health insurance has gone up 23 percent, even after ObamaCare. Gas prices are now about $4 a gallon. They have doubled since President Obama took office. Home values nationwide have plunged by 14 percent in my State of Arizona, and in many places it is by 50 percent.
So instead of creating a to-do list for the Senate, as the President has done
just 6 months before the election--asking us to vote on what a lot of people call show votes and dividing the country by pitting one group against another--I urge the President to make some real steps to steady the economy and reassure the job creators.
Let me give four specific examples of what the President could do to lead and what I think Congress would be willing to do to follow.
First of all--and a couple of these things are to stop doing something that is bad. A lot of people say government can usually do best by just getting out of the way because we have a very robust private sector if it is not too tied down with government regulation and taxation. So the first suggestion I have is let's stop the largest tax increase that will automatically occur--it is the largest tax increase in the history of our country--on January 1.
Someone may say: What? I didn't hear about that.
I am speaking about the so-called Bush tax cuts. Ten years ago Congress passed these tax cuts, but they had a limit of 10 years. Actually, it was a shorter period than that. They were extended 2 years ago because the President said it would be bad for the economy if these tax rates were allowed to go up, and he was right. He was right then, and he is right today. It would be bad for the economy. It would be bad for businesses, especially small businesses. It would be bad for the American family. Yet, automatically, if Congress does not act and the President does not act, every one of the marginal income tax rates will go up. Things such as the marriage tax penalty, the child tax credit, the capital gains rate, dividends tax rate, the death tax rate--all of these combined will go up, resulting in the largest increase in the country.
When we consider economic growth, when we talk about a wet blanket or when we talk about something that will kill economic recovery, that kind of a tax increase, which means taking money out of the private sector and giving it to government, is about the worst medicine one could think of. So my hope is that the President will lead and Congress will provide the support necessary to extend our current Tax Code and to ensure we don't have the biggest tax increase in the history of the country.
I mentioned taxation and regulation. Well, regulation is No. 2. Over 28,000 pages of new Federal regulations have been added to the books in just this calendar year. Think about that--28,000 pages. We think of going to the store and buying a book of 200 pages, or 300 pages if it is a really big one. How about 28,000 pages of new Federal regulations just this year.
Bureaucracies such as the National Labor Relations Board and the Environmental Protection Agency continue to churn out rules and regulations that confuse job creators and hamper their ability to expand and hire. One example: Because of a public outcry, it was finally decided that the Department of Labor won't issue regulations basically saying that kids couldn't work on the family farm. Many of us worked on family farms. Maybe we didn't like it at the time, but we all agree it did us a lot of good. The reality is that it is not something the Federal Government ought to be poking its nose into. So there was finally enough political push-back from the FFA and the 4 H Clubs and the Farm Bureau and really everybody who was sensible about looking at it that they pulled it back. But unless the American people apply pressure and push back against this stuff, bureaucrats and the Federal Government are going to continue to figure that they can run our lives better than we can do it ourselves.
One of the biggest burdens in terms of regulations is ObamaCare. It has made the regulatory state much bigger and much more expansive. It has resulted in an estimated 58.5 million annual paperwork hours, according to the American Action Forum--58.5 million annual paperwork hours. I have talked to businessmen and I have talked to medical offices and so on, and they are going nuts trying to figure out how to deal with all of these new regulations.
The House of Representatives has passed numerous bills that would reduce the regulatory burden Washington imposes on the economy, but the President and the Senate Democratic leadership have refused to bring those to the Senate floor. So that is the second thing we could do.
It all boils down to this: We should rely more on the power of freedom than on the power of government. If we do, the American people will do the rest. So let's stop this biggest tax increase in the history of the country. Let's stop issuing these burdensome regulations.
How about the third thing: American energy. We could be one the most energy-wealthy countries in the world--if not the most--just taking advantage of our own resources. We would no longer have to be dependent on the Middle East for our sources of energy. But unfortunately, here, too, the President and Senate Democrats have repeatedly pursued tax increases on the oil and gas industries, raised the cost of gasoline, and increased our dependence on foreign oil, according to the Congressional Research Service--the nonpartisan entity that looks into these things when we ask them.
Instead of basing an energy strategy on punitive tax hikes, we think it would be better if the President would just work with us and work with the House of Representatives to expand the development of domestic resources offshore, on our Federal lands, in Alaska. We have plenty of oil and gas and we have plenty of other kinds of reserves of energy that could make this country not just no longer dependent on the Middle East but much wealthier than we are today. Part of that is just simply approving the Keystone Pipeline. This isn't even American resources; it is in Canada. They meet all of their environmental requirements. It doesn't damage the environment here in the United States. They have already done the environmental reviews for the pipeline. There are thousands of pipelines crisscrossing our country. This pipeline is not going to create an environmental problem. The President has said that the part that goes from Oklahoma down to Texas is fine with him but not the part that requires EPA's go-ahead.
So that is the third thing. Let's have an energy policy that takes advantage of what we have, including approving the Keystone Pipeline.
Finally, what the President and our Democratic friends here in the Senate could do is to join the House of Representatives and clear the deck of all of the legislation that has been piling up here on the Senate floor that isn't getting done that we all know has to get done before the end of the year. These are not optional. This is our homework. This is stuff we have to do, and it is all being put aside for the lameduck session.
The lameduck session is the time in between the election when new Members of Congress have been elected and the time they are sworn in-- essentially at the end of the first week in November to the first week in January. I will be a lame duck; I am not running for reelection. I would rather the new Senator from my State make the decisions about the future of the country, but because all of these things are piling up, I will be one of the people here making these decisions for the future of our country. I don't mind being here, but it will be very bad for the country to pile up all of these things and expect to get them done smartly in the 5 or 6 weeks that surround Thanksgiving and Christmas.
What are some of these things? First of all, just funding the government--the appropriations bills. Nobody expects we are going to complete work on all of the appropriations bills to run the government, as a result of which we will have to, at the end of the year, pile a whole bunch of bills into what have been called Omnibus appropriations bills--``omnibus'' meaning we throw everything into the same pot. The problem with that, coupled with the fact that the Senate hasn't approved a budget in 3 years and won't approve a budget this year, presumably, is that nothing is prioritized; it is just basically a continuation of the spending from years past. So we are not making the critical decisions about dropping this and adding this that would provide more sensible funding of our Federal Government. So that is the first thing we ought to be doing, and that leads me to the second thing.
We have been borrowing so much money that it is very clear we are going to once again run up against the
debt ceiling. We have borrowed so much that we have to increase the debt ceiling in order to pay the money we have borrowed. Nobody likes to do it. Nobody likes to say they voted to increase the debt ceiling. Well, then, why vote to incur the debt in the first place? Oh, we have no trouble doing that--at least some Members in this body and in the House don't--but the reality is that when those people have incurred that much spending, we have to pay the debt, and that means the debt ceiling has to be raised. When will this come to pass? Right after the election. We wouldn't want to take it up before the election. It might remind the American people about how much--too much--we are spending. Forty cents on every dollar we spend in this country we had to borrow. So the debt ceiling is something we are going to have to deal with.
Here is one of the biggest of all: sequestration. We agreed in the Budget Control Act last year that we would save about $1 trillion over 10 years on discretionary spending and we would try to save another $1.5 trillion in mandatory spending--the so-called entitlement programs that are really costing us big bucks, including Medicare, Medicaid, and Social Security, and there is a whole variety of other programs that are included in entitlement spending. Nobody is talking about ending these programs as we know them. What politician is going to call for an end to Social Security or Medicare? That is not what we are talking about. We are talking about effectuating savings. There is a huge amount of waste and fraud and abuse that everybody acknowledges. We could save billions of dollars in all of these programs, and we need to do that.
We need to save $1.2 trillion, which is the actual amount required by law, over 10 years. When we subtract interest, that comes out to about $908 billion or $918 billion--I have forgotten which--each year. So some of us have introduced legislation to pay for this $900-plus billion for next year, to offset with spending reductions the cost of this sequestration. ``Sequestration'' is a fancy word for across-the- board spending cuts. Half of them go directly to the Department of Defense, and the other half are spread all across the other programs in our budget, from education, housing, you name it. Well, does it make sense to just take a meat ax and lop off the top 10 percent or top 12 percent or whatever it might be of the spending in all of these different programs? Would we want to buy four-fifths of an airplane in the military? Does that make sense or does it make more sense to save $10 here so we can spend $10 over here? Obviously, it makes more sense to do that.
Everybody assumes that somehow we are going to avoid sequestration in the lameduck session of Congress. Who is doing anything about it? Well, some of us have introduced legislation. Also, we hope that this week in the House of Representatives they will be able to amend the Defense authorization bill by adding a provision that says the numbers in that bill assume we have resolved this sequestration problem as a way to begin negotiations so we can find a solution that both Houses will agree to and both political parties will agree to. This shouldn't be partisan. Everybody loses if sequestration occurs. So let's solve that problem, and let's solve it before we get to the lameduck session. That is the third thing we can do.
Everybody familiar with our Tax Code knows there is a fourth thing. We have something that happens each year. There are 60 provisions in the Tax Code that expire every year. We have to renew them, and we do, so let's get about it. They have already expired. These are the so- called tax extenders--extending certain provisions of the Tax Code that everybody wants to see extended. They have already expired. We need to do it retroactively the first of the year. Everybody knows we are going to extend most of them; maybe we won't do all of them. We need to do that, so why not? Let's get that done.
We know there are other things that are occurring. There is something called the doc fix. Each year we have to figure out how to pay the doctors who take care of Medicare patients. It costs a lot of money. If we don't pay them, we are not going to have any doctors who will take care of Medicare patients. So it is always a dance: Well, we have to figure out how to pay the doctors. The reality is that if we don't pay them, then we only have ourselves to blame when our senior citizens can't find a doctor to take care of them when they need that care.
There are others as well. The payroll tax holiday expires, and there are many others we need to do as part of our business as Representatives and Senators. This isn't optional. These have to be done to keep the government running, the things we promised our constituents in legislation that we would do.
So another suggestion is let's start working on these big problems. Many of us who will be in a lameduck position are putting a letter together to our leadership asking them to please tackle these big problems. We should not be voting on a lot of these things. We should be done as of the end of the year. But if we have to, we will. It is not that we are not ready for the work. It is that these things should be done before the election.
This is my last point. You ask, why, if these are things we are supposed to do--the appropriations; dealing with the Tax Code, because it will automatically have a big tax increase if we do not; the sequestration; the debt ceiling; paying the doctors--if we have to do all of these things, why are we putting them off?
Well, here is the dirty little secret. Because if we actually tackled them, we would have to make some tough decisions. If we made tough decisions, we would have to take votes. If we take votes, those votes are going to be on the record. And if those votes are on the record before the election, our constituents will know what we think and how we act, and some of them may not like it.
So we do not want to be on the record, some of my colleagues say. Again, it does not bother me; I am not running for reelection. We do not want to be on the record before the election. It is a little bit like when the President leaned over to then-President of Russia Dmitry Medvedev and he said: Look, after my last election, I will have a lot more flexibility to deal with these issues. You tell Vladimir.
Well, after the election it is too late. The people have cast their ballots. Shouldn't the politicians be willing to say before the election what they stand for? And instead of making campaign promises, how about taking votes on real issues so the American people know where they stand? Then they can make an informed judgment: I like this person over that person because I like the way this person voted or I do not like the way that person voted.
That is what democracy is supposed to be all about. You make the tough decisions. You stand for election. The people either say yes or no. Then, by the way, they hold you in account. After you are elected, they continue to watch how you vote to decide whether they want to vote for you again. But in this day and age, we are playing hide the ball from the American people: Let's do not bring anything up until after the election. That way the American people will not see how we feel about these things.
Some of these are tough votes, I acknowledge. It is hard to figure out how to effectuate savings. If you have to come up with $100 billion in savings over 10 years, something has to go. So you cannot promise everything to everybody. You actually have to find $100 billion in savings somewhere.
Senator McCain and I and Senators Cornyn and Ayotte and Rubio and Graham and some others have introduced legislation to say: Here is how we would do it. If somebody has a different way of looking at it, tell us.
I will tell you the way we would do it. You can save $100 billion by doing two things. When people leave government employment, instead of hiring somebody to replace them, we would hire two people for every three who leave. The Bowles-Simpson Commission says only hire one for every three who leave. So we are being a lot more liberal than Bowles- Simpson. We say, every time three people leave the government, let's only hire two back. I bet we could get by as a country doing that. The other thing is, the President froze increases in Federal salaries, and we would simply extend that freeze through the middle of 2014.
There are other ways to do it. There are hundreds of billions of dollars to be
saved. If you have a better idea, we are all for it, but at least come up with something and do not be afraid to vote. The American people are pretty smart. They get this stuff, and they know there is no free lunch. They know that government costs money, and they know you cannot save money by continuing to promise everything to everybody.
I urge my colleagues on both sides of the aisle, the leadership in both the House and the Senate, let's get serious about this. First of all, let's not raise taxes. Let's reduce regulations. Let's have a real energy policy. Let's get our work done--the work we know has to be done. And let's get it done as soon as we can. That would give families and businesses the knowledge of how to plan for the future. That would help them understand what they have to deal with and not have to incur this huge uncertainty, which is so much of a drag on our economy today.
These are four constructive suggestions. There is a lot more we could do. But when our economy is in as bad a shape as it is right now--and it is not getting much better; we have this many people not even looking for work anymore--we need to do something more than be out on the campaign hustings talking small ball and trying to blame it on the other side.
Let's get to work, follow these four ideas, and I think we could make tremendous progress to get our country moving again. Frankly, if we did, I think the American people would reward us. They would say: Thank you. Thanks for finally doing something. That is what we sent you there for, and we will reward you for it. So ironically, good policy turns out to be good politics. I think we need a little bit more good policy.
I suggest the absence of a quorum.