Economic Meltdownby Senator Sheldon Whitehouse
Posted on 2013-01-30
WHITEHOUSE. Madam President, I actually came to speak on another
subject, but I had the opportunity to hear the minority leader's
remarks as I was waiting to speak. I would point out in response that
our friends on the other side love to characterize the spending that
has taken place in recent years as something that was the will and
choice and desire of President Obama. What they fail to recall is that
during that period, we actually had an economic meltdown. Most
Americans remember that economic meltdown. States such as Rhode Island
are still in the aftermath of that economic meltdown--an economic
meltdown, by the way, that occurred at the end of the last Republican
administration and was caused by those policies.
The economic meltdown was relatively global. We have very practical examples of countries that went the path of spending cuts that the Republicans recommend--recommended through the whole economic meltdown. Just take a tour of Europe and you will see where the austerity plan was followed, the results have been far worse: lower GDP growth, higher unemployment. We are actually struggling through better in America by understanding that when the economy is collapsing, if the Federal Government withdraws even more money from it, it just collapses faster and you postpone the period of growth and recovery.
This business us only having a spending problem--well, you can look at the revenues as adequate, but it depends what you are measuring it against. If you are measuring revenues against the times when we had a balanced budget, it has always averaged 20 percent. It averaged around 20 percent of GDP. We are at 16 percent right now. This is a huge gap. If we drop and try to balance the budget, which is what I think we would like to achieve at 16 percent, we are going back to the social conditions of the early 1950s, conditions where many seniors still lived in poverty. I know the party on the other side likes looking back, but I do not think they want to look back to that. I really do not think most Americans want to live in a country in which that is the case.
So, do we have a spending problem? Yes, of course, we do. But when revenues are at 16 percent of GDP and we have never balanced the budget in recent history at 16 percent of GDP--in recent history, it has always been with revenues around 20 percent of GDP.
When you have these unbelievable revenue giveaways to special interests--Big Oil getting these huge subsidies, hedge fund managers paying these favored low tax rates, tax rates lower than their chauffeurs and their doormen and their maids pay--the Tax Code is riddled with those kinds of special interest giveaways, and if we can bring some of that back into the equation, not only does that add revenue and move us better toward the goal of a balanced budget and a reduced deficit but, frankly, in most of those cases, it is the right thing to do all on its own. It is the fair thing to do all on its own.
Yes, there are things that are idiotic buried away in the Federal budget. I am not here to defend studies about pig manure or reality TV shows. But the [[Page S372]] problem is that once you actually get into discussions on this subject with the other side, it is not long until their guns turn on Medicare, it is not long until their guns turn on Social Security. We have seen it before. They tried to privatize Social Security. They thought they had the power to do it, and the American people told them: Heck no. But that is where the discussion goes. It may start with reality TV shows and pig manure, but before you know it, they have their guns trained on Medicare and Social Security. We need to defend programs such as those on which families depend.