Floor Statements

Mr. Speaker, I thank my colleague from Oregon for leading us in this Special Order tonight to discuss the real problems confronting our Nation, which will get, we all fear, short shrift tomorrow night.

The State of the Union is not sound. Millions of Americans and their families are not secure in their homes, not because of some huge new crime wave, not because of the threat of Saddam Hussein or any external threat to our Nation, but because of the deep recession into which our country is falling.

My State has the highest unemployment rate in the Union. We have been dueling with Washington State to be number one or number two for more than a year. There is chronic unemployment, but it is not isolated to our States, it is all across the Nation. We have the highest unemployment rate in more than a decade. We have the most chronic unemployment we have seen in a quarter of a century in terms of the length of time people are out of work before they can find gainful employment.

Tens of thousands of Americans have already extended their so-called extended Federal benefits, and the President has refused to give an additional extension, although there is a huge surplus of taxes that have been paid by businesses and workers sitting in the Unemployment Trust Fund. The President wants to hold onto it to spend for other things, like tax breaks for the wealthy.

Most folks may not have noticed, but the United States Government's Pension Benefit Guaranty Fund is broke. It spent its entire reserves in the last year, and there is a whole huge new wave of corporate bankruptcy coming, with people's pensions at risk, and there is no more money in that fund. But what does the President have to say about this? Well, precious little. He is going to spend the entire Social Security surplus this year on tax breaks and other functions that do not relate to Social Security.

Our States are going bankrupt. They are cutting services; slashing services. Now, the President, I think, will give some nod tomorrow night with his purported economic stimulus plan, but if we look at the plan, the centerpiece is taking away that horrible burden of taxes on dividends on a select group of stocks that pay dividends with the idea of doing away with double taxation. Well, many of the corporations that pay dividends do not pay any Federal income taxes. They have found the loopholes; they are incorporated in Bermuda. All those things the President supports and will not do anything about. So there is no double taxation issue.

Who does the money go to? For the average Oregonian, at $32,000 a year, they will get $40. Thank you, Mr. President. Now, the average millionaire will get $45,000. Now, there are no credible economists who say that this has anything to do with an economic stimulus,

but this is the most expensive part of and the centerpiece of the President's so-called economic stimulus plan to try to put people back to work. Even Alan Greenspan, who is perpetually apologizing for these types of policies, says he really does not think it will do anything to put people back to work or stimulate the economy, and it would be just as good to not do it at all.

When the President was a candidate and we had a booming economy and a surplus, his answer as a candidate was tax cuts. Then when we had a slowing economy and a surplus, his answer was tax cuts. Now we have a devastated economy falling deeper and deeper into recession, and his answer is tax cuts, for a select few.

There are better alternatives. Some of those will be discussed here on the floor tonight. I have discussed those at other times, and I do not have time to go into it now, but there are better alternatives to really invest in this country and its people and put people back to work.

Finally, to the war. Osama bin Laden, who was going to be brought back dead or alive, is alive and is plotting further attacks on the United States. Afghanistan, which was going to be made into a country that would recover and not be made a safe haven for terrorists, has now begun to set up terrorist training camps again. The Axis of Evil, Korea, is building more nuclear weapons, they already have them, and more long-range missiles that can hit the United States. Iran is close to having nuclear weapons. And yet the President and his staff are focused on Saddam Hussein and the horrible threat he poses.

Actually, Rumsfeld, Cheney, Wolfowitz, and all those people came into office with President Bush II wanting to refight the first war. This has nothing to do with 9-11 or any purported ties to terrorists. This is old business, an old agenda by old men, none of whom has ever fought in a war or ever worn a uniform and fought in anger.

So I would hope that the President's State of the Union will not fulfill all of these dire predictions that I have mentioned, but I fear it will. Tax cuts for the wealthy and a war are a nostrum for what fails our Nation and the problems that are confronting us.

Mr. Speaker, I don't have to lecture my colleagues on the difficult economic problems facing the country, state and local governments, and far too many of our constituents who have lost jobs or are losing benefits and support services due to budget pressures. We're all much too familiar with those facts.

But, I was elected to be a voice for those who need help. And, Mr. Speaker, there are 18,000 Oregonians who need help and this bill isn't going to provide it. I'm grateful that this bill will provide extended benefits for some 20,000 unemployed Oregonians who were at some stage of the Temporary Emergency Unemployment Compensation (TEUC) program that expired on December 28, 2002, and the 35,000 Oregonians that are expected to lose work between now and the end of May when this extension expires. However, the bill turns a cold shoulder on the 18,000 long-term unemployed Oregonians who have already exhausted 26 weeks of TEUC.

The unemployment rate in Oregon has hovered between 7 and 8 percent for more than a year. Several counties have double digit unemployment rates, and new layoff are announced weekly. The workers of the Pacific Northwest need help. And we should give it to them.

The Congressional Budget Office projects the national unemployment rate will remain at about six percent until the second half of 2003. The Oregon rate is expected to be higher than the national average.

Unemployment insurance provides targeted and effective economic stimulus. These critical benefits increase consumer spending in the hardest hit areas and sustain and strengthen economic recovery. Fortunately, the federal unemployment insurance trust funds contain large reserves that can be used to strengthen TEUC without additional unemployment insurance taxes.

I sat here today and listened to the debate on this legislation and heard member after member on the other side of the aisle say how important this legislation is and how much workers need this assistance, but we just can't afford to provide additional benefits for the long-term unemployed. That's not true, and it's unconscionable that we're not providing additional benefits for those who, through no fault of their own, have found themselves on the wrong side of this ``economic recovery,'' and haven't been able to find work.

Somehow, we could afford to give members of Congress a generous 3.4 percent cost-of-living adjustment, but could only give senior citizens a paltry 1.4 percent increase. Somehow, there was money to throw all sorts of favors to corporate special interests at the end of the session, and there's money for more tax breaks for those earning more than $373,000 a year. Somehow, there was money to give President Bush's political appointee's bonuses at the end of the year, but we can't use the huge surpluses in the unemployment trust funds to give a hand to the 800,000 long-term unemployed who are trying to hang on to their homes, pay the heating bill, keep food on the table, and keep their families together. There's something very wrong with the priorities here.

I appreciate the gentleman coming to the floor to try and explain the differences between these two critical plans. I happen to represent a part of the State of Oregon which has the highest unemployment rate in the United States of America and a part of the State which is particularly hard hit and am very concerned about an effective economic stimulus package. Representing a district with a high and enduring unemployment rate, I do not find that the elimination of the tax on dividends is very high on the agenda of anybody that I meet with in my district and how we are going to put people back to work and how we are going to get the economy rolling again.

I share the gentleman's concerns. Certainly there are some interesting arguments to be made about how best to properly tax corporate profits and/or dividends which result from them, but if one looks underneath that whole issue, we find that many profitable corporations do not pay taxes and, therefore, the dividends are not being double-taxed in any way or form whatsoever. And also many of the individuals who realize these dividends are not the people who are unemployed or are worrying about their future or how to put food on the table for their kids. In fact, as the gentleman said earlier in the discussion, more than two-thirds of the benefits will accrue to people with incomes over $100,000 a year. The question becomes, is that an effective economic stimulus?

Let us see. A year from now, people will begin to file their taxes, probably most of the folks who clip coupons and dividends would be a little later in the year, so maybe 15 months from now some of those people who earn over $100,000 a year would realize an additional savings in their taxes or maybe a refund which would come in April or May or June and somehow that is going to provide an economic stimulus in the year 2003 when that does not happen until the year 2004? Beyond that, there is a whole issue of is this not a revisiting of trickle- down economics? If we give a little bit more to the people who are already doing relatively well, or in some cases very well, will they not spend that money in a way to put people back to work? I think there are some real questions about that, but it is at least more artfully presented than it was years ago under the Reagan administration. They are avoiding the words ``trickle down.''

But as the gentleman discussed, there are alternatives out there. We could certainly look at, as an alternative, things that are going to have a more immediate impact on the economy of the United States and put more middle- and low-income families back to work or on a more secure economic footing. If we look at, from my perspective on the Transportation Committee, the Nation's incredible underfunding of infrastructure, in my State alone, again the State with the highest unemployment in the union, has discovered that because of construction techniques used for the interstates back in the sixties, we have a $4 billion bridge problem on I-5, the most vital interstate-international link on the western corridor between Mexico, California, Oregon, Washington and Canada. That is something, in a State in as deep a recession as we are, that is beyond our capabilities. We need some additional help from the Federal Government. We know what the problems are. We could get people to work within months, as soon as the contracts could be let on making those repairs. Critical water. There are a whole host of infrastructure needs, rail, bridges, highways, water, that would put people back to work and would provide secondary benefits to suppliers and small businesses in the communities where the workers would be. All these things would certainly have a much more direct economic impact than a tax break to people who are concerned about the taxation on their dividends that would accrue to them some 16 or 18 months from now. Hopefully by then this issue will be behind us.

The President's plan, of course, is so extraordinarily expensive. I mean, more than half of the President's entire plan is devoted to the concern about people who pay taxes on dividends as opposed to his rather small benefits for people on unemployment. We need a much more robust extension there. We need more worker retraining. There are other issues that could be debated. Whether or not we should have some sort of tax holiday on part of the FICA tax. More than half the families in America pay more in Social Security and Medicare taxes than they do in income taxes to the Federal Government. So if we could provide some relief there but not short the Social Security fund by putting that money back in; the States, as the Democrats have proposed, to provide to the States.

We have heard for years from that side of the aisle, Federal mandates, no unfunded Federal mandates. A whole host of new ones have come down, including the Leave No Child Behind Act and the testing that is required, yet there is no additional money flowing from the Federal Government; yet the States and particularly my State is strapped and the President's tax proposal would actually take money from the States, $4 billion for the exemption of dividends, so States again would not be able to get taxes from those most well off and would be forced to either cut benefits for everybody else on programs, or essential schools, on health care, or they would have to raise taxes again on the remaining smaller tax base.

I applaud the gentleman for taking the time to come and try and outline some of these differences here on the floor. It is critical that people know they have a very clear choice. I think over the last couple of years, that was not so clear to many people, but now it is our duty to show them that there are clear choices to be made on some of these very, very critical issues, and this is the first one out of the chute after the elections of last year. I am determined that we will draw the lines and we will show here is what we would do, it is more responsible, it would provide more direct stimulus, it would benefit more people and more people in need in particular as opposed to what is being proposed by the other side of the aisle which is fiscally irresponsible, not paid for, will not kick in for 16 to 18 months or even longer and is really just trying to do what they were already doing before we were in a recession or proposing before we were in a recession but justify it by saying it will help us with a recession.

I thank the gentleman for clarifying those issues.

Mr. Speaker, the gentleman raised the unemployment numbers. It is interesting that recently a survey has come out of rural areas in my State, particularly areas that were previously timber- dependent areas, about unemployment; and the numbers that we record today in unemployment do not reflect the real suffering or the true degree of unemployment. As high as unemployment is in the United States, and it is at some of the highest numbers it has been in a decade under this administration without an extension of unemployment benefits, which hopefully will be rectified here this week, but the numbers are actually much worse because the definitions have been cleverly changed to say, well, if they are unemployed and their unemployment benefits have run out, they are not considered unemployed anymore in the United States.

So if we follow that illogic through, if everybody in America lost their job today and all their benefits an out a year from today and nobody got their job back, no one would be working and we would have zero unemployment. It is an absolute absurdity. So the true measure of unemployment is actually

much, much higher than we are seeing; and the struggle, as the gentlewoman from Ohio (Ms. Kaptur) said, to bring some productive capacity back to this country and put people back to work, we were all first promised, well, they are losing their jobs in industry but they will all go into the new economy.

Well, the new economy has gone bust, and most of them did not get jobs there anyway or benefit during those good years; and one cannot, in my opinion, be a great Nation if one does not build things, and the reliance on foreign oil is extraordinary. The fact that our greatest balance of payment, the deficit, is to buy foreign oil, supporting people who hardly have any interest in the United States in mind and our future in mind and the investment in alternative fuels, alternative fuel technology to include fuel cells and all the other things that the gentlewoman talked about, bring those industries home to the United States and begin to export them into the rest of the world in addition to insulating ourselves from these people who are jacking up oil prices around the world would be an extraordinary benefit to the American people. And I hope that this administration, this unfortunately oil administration that we have in the White House, might be able to clear their vision a little bit, instead of saying we can somehow drill our way out of this, which we cannot. Even if there was as much oil as the most optimistic say up in the Alaskan National Wildlife Refuge and along the coast of the United States, we still could not drill our way out of this problem. We would still have a growing dependence on foreign oil. We need to make dramatic steps and investments in that direction, and we should orient more longer-term packages toward the recovery of our economy toward those new technologies, toward those investments in our country, and those are the kinds of things we need.

An ephemeral investment or expenditure of $300 billion to relieve people from paying taxes on dividends on stock, mostly people who earn over $100,000 a year, as an economic stimulus is almost laughable. I mean, it is extraordinary to me. And if it does work and it stimulates the stock market without dealing with the underlying problems and the fundamentals of U.S. industry and their unwillingness to invest if this country, in the productive capacity of this country, it will create another bubble, and guess what, some people will ride the bubble up, get out, and it will pop again, and what happens? The people who are always stuck are the middle class and working people who cannot get in and out of the market because their only investments in the market are through their retirement funds which they cannot liquidate and speculate on the way that some of these other folks can. It may well cause a big run-up in the stocks that pay dividends in particular, but it is not going to generally leaven the economy and put people back to work. I have yet to see a single credible economist make that assertion, that somehow this $300 billion gift other than through the trickle-down theory is going to somehow put people in this country back to work.

Mr. Speaker, 28,000 people in my State alone saw an end to their unemployment benefits in the week between Christmas and New Year. Happy New Year from the Federal Government.

Mr. Speaker, if the gentleman would keep in perspective, the total cost of the Democratic proposal, as I understand, it is to be twice as generous in terms of the extension of unemployment benefits; and to again, to begin to even penetrate some of those other people who have been longer unemployed or underemployed, is about one-twentieth, 5 percent, of what the President is proposing to gift upon the wealthiest by relieving them of the horrible burden of paying a small percentage tax on the dividends they earn by clipping coupons on stocks that they own.

Where are our priorities? Could he not do 10 percent for the unemployed and for their families? I mean, it is just extraordinary to me that the emphasis would be so thinly disguised.

From local small businesses.

Mr. Speaker, if I could, in my State, we have an extraordinary, we have already exhausted this year's allocation of low- income energy assistance in our State; and we are, what, 3 months into the year, the beginning of the heating season; and there are tens of thousands of people on the waiting list in my State, and I am sure in other States across America. And to say, well, we just cannot afford those things, but we can afford for the people who live up on the top of the hill in the big houses with all of the lights on and the windows open, we are going to give them a little extra gift so that they can go to Antigua to avoid the colder months.

Mr. Speaker, if I could expand on that, it is day 10 since the extended unemployment benefits expired, and Congress is not in official session this evening taking care of that problem. They are out, many of them downtown with the lobbyists on K Street celebrating with champagne beyond the weekly food budget of many of these families who are unemployed.

Mr. Speaker, we should remember that unemployment benefits have been paid for by the employers and the employees. The employers have to pay a tax; most economists say that comes in the form of lower wages or at least is shared in lower wages by the employees, and there is a large and healthy balance in the unemployment trust fund. Yet our colleagues on the other side of the aisle, the President and the Republican majority, have refused to expend some of those taxes. That was money that was saved for a rainy day for families and individuals across this country. It is raining like hell out there right now, and they need that money. It is their money. That, in fact, does not have an impact on the deficit. Giving a $300 billion tax break to people who clip coupons on their taxes does cost the Federal Treasury and will increase the deficit, but if we kept the books honestly, money spent out of the unemployment trust fund which has been accumulated over many years for a rainy day would not count as money that is spent and created out of nothing. There is money there to spend. It is just like we could invest in infrastructure by spending down the highway trust fund. We could invest in aviation by spending down the aviation trust fund. We could accelerate a whole bunch of projects across this country and put people back to work, really. I mean, in the phony way we keep books here, it counts as deficit; but in reality it would not be. The American taxpayers would be getting the money back that they paid for the purpose for which it was intended, which is unemployment benefits or investment in bridges, highways, roads and aviation.

China is building a huge and very expensive multibillion dollar new high-speed rail system, probably with some U.S. investment behind it.