Mr. Chairman, the gentleman from Texas (Mr. Thornberry) and I have spoken about the fact that this budget protects our country, our national defense, and our homeland security. And nothing is more important this afternoon, as this is a…
Mr. Chairman, the gentleman from Texas (Mr. Thornberry) and I have spoken about the fact that this budget protects our country, our national defense, and our homeland security. And nothing is more important this afternoon, as this is a very critical time in the Persian Gulf. Our troops are committed, and we are committed to them.
However, this budget meets another challenge, and that is the challenge of strengthening the American economy and creating new jobs. Promoting growth in this economy and getting people back to work is a top priority of ours, and it is reflected in this budget. That is why it provides for policies that create an economic environment for boosting both long-term and short-term growth. In particular, the budget leaves room for President Bush's jobs and economic growth plan to strengthen the economy by providing an immediate stimulus to help struggling
American workers and by laying the groundwork to promote long-term, sustainable growth in our Nation's economy.
A Member on the other side of the aisle called this growth package irresponsible. We do not think it is irresponsible to bolster household finances or encourage consumer spending. We do not think it is irresponsible to promote investment because it leads to job creation, and we do not think it is irresponsible to help the unemployed get back to work. That is what this budget does.
Mr. Chairman, 2 years ago we passed tax relief that not only put money back in people's pockets, but it slowed an advancing recession that President Bush inherited. The 2001 tax relief plan made that recession the mildest in history, and it created 1.5 million new jobs. Without the leadership this Congress showed on a bipartisan basis and this President showed, the recession and the job loss would have been far worse when America came under attack on September 11, 2001.
Now in this budget we provide for the President's economic growth package which will create new jobs and sustain growth. The plan accelerates the reductions in personal income tax rates, the marriage penalty relief in the 2001 tax cuts. It accelerates the child tax credits from 2001. It increases small business expensing, and it eliminates the unfair double taxation of dividend income.
Experts generally agree that this proposal will boost stock prices dramatically. Some say 7 percent, some say 20 percent. The fact is, we are going to add significantly to the value of our stock market, which helps all of us as Americans, including half of all American families now invested in the market. It helps the economy in general.
Economists also say it is going to lower unemployment rates for the next several years. In fact, the average of private forecasters' estimates show the President's plan will result in more than 1 million new jobs by the end of next year. It goes without saying that America is still dealing with the aftermath of the September 11 terrorist attacks and with the continued uncertainty on the international front, including in Iraq today. Our economy is not performing as it should, and too many Americans are out of work.
This budget resolution is responsive because it helps get the economy going again; and when that happens, revenues grow. It happened in the 1960s under the leadership of President John Kennedy, and it happened in the 1980s with President Reagan's tax relief plan because it was pro-growth.
Here is a chart which indicates the Reagan-era revenues. Look at this, from 1982 until 1989, the dramatic increase in revenues. Again 1960s, 1980s. That is what we are trying to replicate now.
Mr. Chairman, with the growth package, we are also going to be able to be sure we can afford these tax cuts. I have heard Members say we cannot afford them; it is good to have growth tax packages, but we cannot afford it. This is an interesting chart. This is a static analysis, meaning it shows absolutely no impact of the tax relief, which has countered everything we have seen in history.
When we provide that incentive for job creation, it increases revenue. It helps the budget, but this assumes none of that happens. Just to have the tax relief in place, this is the difference. The red on the chart shows what the budget would be like with the tax relief taken out altogether. No tax relief at all. The green shows the impact of all this pro-growth tax policy, again on a static analysis. As Members can see, it is a very small difference. The tax relief is not crowding out additional spending, it is growing the economy so we can get people back to work and grow our revenues.
Mr. Chairman, I would like to encourage Members on the other side of the aisle to listen to one of their former colleagues, currently a Governor in the State of New Mexico. Bill Richardson, who was also a member of the Clinton cabinet, has a plan for his State that restrains spending; and, yes, it reduces tax. Why? Because he knows it is going to help his State's economy and in the end help in terms of revenues. He has said and he offers this as free advice to his fellow Democrats. He said, ``We Democrats need to stop talking about class warfare and distribution of wealth. We need to start talking about economic growth, and reducing taxes puts us on the road to economic growth.'' I think he is right. I always liked Bill Richardson, and now I know why. Well put.
Mr. Chairman, this is a responsible budget because it protects our country and because it grows the economy, gets the economy back on track and creates jobs.