Press Conference with Senator Barbara Boxer (D-CA); Senator Jack Reed (D-RI)

Press Conference

PRESS CONFERENCE WITH SENATOR BARBARA BOXER (D-CA); SENATOR JACK REED (D-RI)
SUBJECT: THE EMPLOYMENT REPORT

SEN. BOXER: Well, good morning. I'm very -- it's a sobering morning, but I'm glad to be here with my colleague, Jack Reed, because the American people have to know that we're working for them and we're going to get out of this economic mess we're in.

I was trained in economics, got my degree in economics, worked for a while on Wall Street. I've never seen, in my lifetime, any time like this.

Today we received more bad news on the economy, confirming that last year was one of the worst in decades for American workers. Today we learn, I'm sure you know, that we lost 524,000 jobs last month. And I'm going to go through just about four charts with you which gives you a picture of where we are.

Unemployed Americans are now 11.1 million; January '01, 6 million. So you can see that number. The unemployment rate: 4.2 percent, January 1; 7.2 percent in December.

Now, I know -- I'm sure Senator Reed can give you a picture of his state. I want you to know in my state things are far worse. Last month they were -- it was over 8 percent unemployment. I have counties that are over 13 percent unemployment.

And if any of you are interested, I did a statewide survey. My staff and I, we contacted all 58 counties in California -- you know we're about 37 million people -- and we have a page for each of these counties, and for the 20 major cities.

It gives you a picture of the dire straits that we're facing right now in terms of budgets for not only states, but counties and cities; in terms of the unemployment rate in these various areas, businesses in trouble, and the rest. It's a very broad recession, and it's a deep recession. And our job is to turn it around, that's for sure.

So I'll take you through just a couple of other charts.

Twelve consecutive months of job losses. It's just -- it's very disturbing to people. I heard a report on the radio today about young people's -- in college, just graduating from college. And one had a really great plan of what he wanted to do in his life. And he decided that right now he'd be better off just trying to get a job working at a golf course. He had wanted to go into business. Real things are happening out there to our young people. And that's not good. Total job losses in '08, 2.6 million. And I'll stop with that, as we think about what this really means, what this translates into for our families.

Consumer confidence is at an all-time low. It's our job to restore confidence. We're going to do it with our new president and with the Senate and with the House. But today is a day to look at these numbers and then say, enough is enough. We're going to move now, do the right thing and move swiftly.

We need to create jobs. We need to give aid to our states, our counties and our cities. We need to work harder to help stabilize our markets and stop home foreclosures and turn around this nightmare of declining home prices. And I know that Senator Reed here has been working very hard on that. We'll have more to say on that.

We know the situation won't improve overnight. Nobody's here to be a Pollyanna about it.

But the numbers speak to the urgency. They go to show that anyone who blocks action, on economic recovery legislation, is either uninformed or uncaring. And I want to say that again.

They can say whatever they want to say. But if they block swift action on an economic recovery plan, I believe, they're either uninformed about the dire straits that we're in, in this nation, or they're uncaring. So the time for action is now.

I want to report to you that yesterday, we had a very positive meeting with Larry Summers, David Axelrod. And we went over their economic recovery proposal. Senators were encouraged to express their ideas, to talk about where they agreed with the package, where they thought the package could be made stronger. And we absolutely did that. And we're going to continue that meeting on Sunday.

So this was a very important meeting that we had. There were areas of broad agreement. The package has basically three parts: aid to the states, investment in infrastructure -- the roads, highways, the bridges, the waterways, et cetera -- and a package of tax cuts. So it's three parts.

Yes, there are details to be ironed out. I think there's a pretty good consensus that a lot of us would like to see more investment in renewable energy, tax cuts for the development of wind, solar and geothermal. There is certainly some in the package. But we think it's important to take a look at that.

We want to make sure that the tax cuts create jobs. And that's what we're working with them on. And we'd like to see more attention paid, to the housing crisis, in this package. So there are other things around the edges. But on the broad parameters of these three ideas -- aid to the states, tax cuts and investments, including investments in our roads, highways and bridges and waterways -- there was broad consensus.

So I'm here to say today, we have to look at what's going on. It's very brutal. What's going on in America today, this recession is brutal. These numbers speak for themselves. And we are ready to work. We are working closely with the new administration.

I think it's historic that we would see so much work happening on behalf of an administration that hasn't even been sworn in. Working, they're working overtime because of the gravity of the situation. And it's my honor to bring Jack Reed to the podium.

SEN. REED: Thank you very much, Barbara.

We're in an extraordinarily challenging time for working families throughout this country. They are facing grim employment statistics. They're looking at the value of their homes declining. their plans and their hopes and the future opportunities for their children are all coming into question now. The key to revising this terrible economic news is swift and significant action by the United States Congress.

And let me echo what Barbara has said. If there are those who want to delay this action or diminish this action, they are either uninformed or uncaring about the plight of working families across this country. Today we heard the news that the unemployment rate has jumped to 7.2 percent; but in Rhode Island, along with California, the news is much worse. In Rhode Island it's 9.3 percent, the second- highest unemployment rate in the country. Very, very sobering news. And we expect when the state statistics come out, that this 9.3 percent, unfortunately, regrettably, might increase further, which is another reason to act swiftly and act decisively at this moment.

Part of the key to our recovery and our stabilization of the economy is putting people back to work. That is a large part of the proposal by the Obama team.

The second, as Barbara indicated, is to stabilize housing values across the country. We have legislation that we passed last fall, under the leadership of Senator Dodd, to provide opportunities and access to avoid foreclosures. Those efforts should be accelerated and funded. Just yesterday Senator Durbin and Senator Schumer and Senator Dodd announced that Citicorp has lent their support to using the bankruptcy procedures to help people modify their mortgages and avoid foreclosure.

All of these, and more, must be used to stabilize housing prices across this country. For the last -- not years -- decades the central economic premise of every family, and indeed, apparently, everyone on Wall Street, is national housing prices do not decline. Until we reaffirm and restore that premise, we're not going to engender the confidence and the resulting demand by consumers that's going to help lift up this economy.

So we have a huge task before us. But again, we're terribly encouraged by the thoughtfulness, by the energy, by the preparation already presented by President-elect Obama and his team. The meeting yesterday was very thoughtful. The details will be worked out. But the direction is clear.

And frankly, that's what a president has to give: direction and confidence to the public. And we are very confident both with -- that President-elect Obama is not only doing that now but will continue to do that.

Well, this is the cost of inaction: the unemployment rate, 7.2. percent today. In 2008, as Barbara said, we lost 2.6 million jobs, the most since 1945. In 2008, we lost 791,000 manufacturing jobs. These are typically the good, high-paying jobs with health care benefits that not only sustain families but provide the kind of community infusion of cash and support.

The National Bureau of Economic Research determined the U.S. economy has been in recession since December 2007. In December, consumer confidence fell to an all-time low. Home values dropped 13 percent in November, sharpest drop in 40 years, and they continue to plummet. The Dow Jones lost 34 percent of its value, trillions of dollars. Those -- the retirement plans, the 401(k)s, everyone -- if you're sitting around the family table and you see your house decline, your 401(k) decline, it doesn't engender the kind of confidence you need to have a successful economy.

And the states -- again, California, Rhode Island in particular are facing huge shortfalls unless they get support, which is -- will be included in this package. The consequences of increased property taxes, curtailment of services, lay-offs of police, firefighters will compound the problems and particularly for those most vulnerable Americans who need the support and assistance of federal and state programs.

It's clear we have to act. We have to act now; we have to act decisively. And if, I believe, we follow the lead and engage, as we are, in a very collaborative discussion with President-elect Obama and his staff -- we need to move out smartly and decisively. And if we do, we're going to turn this around and we're going to head forward again to prosperity and progress. But will take a long, long time.

Barbara?

SEN. BOXER: Does anybody have questions for us?

Yes, sir.

Q Yesterday, Senator McConnell suggested the -- (off mike) -- to the states should be constructed as loans rather than grants. I'm curious what your assessment on that is.

SEN. BOXER: Well, I would say -- I'm willing to look at any idea, but I will say right now, the states, their costs in this recession -- I mean, they're deep. And I don't know that it helps them that much to have to have another loan on their books.

I'm willing to look at his proposal. But I could tell you right now, my state has a lot of bonded indebtedness already. And these are extraordinary times. And I think it is the role of the national government, in a time like this, to provide countercyclical aid. And I think to do it in a loan puts a burden on the state and the state taxpayers.

My inclination would be, I'm willing to look at this. But I think these are extraordinary times. It means we have to take extraordinary steps. And loading down the states with debt I don't think is the right way to go.

(Cross talk.)

SEN. REED: I just want to concur with Barbara.

You know, the states are having a huge problem, at the moment, going into the bond market to borrow. If they have additional significant indebtedness that could impair their ability to borrow, on a routine basis, both in California and Rhode Island, a lot of this borrowing is just simply to keep the lights on and pay the bills, just to, you know, on a regular basis going out and putting securities out.

This is about turning the economy around. This is not an accounting exercise. This is an exercise of turning the economy around.

Q What did the Obama people tell you yesterday about the cost or the size and makeup of the state aid package? Obviously there's a big Medicaid piece. What's the other pieces?

SEN. BOXER: Okay, let me tell you that they didn't give exact numbers. But what they did lay out was a basic framework. I would say, and I'm using approximate numbers here, approximately 40 percent investment, which would include the infrastructure piece meaning road, highways, bridges, waterways, investment in energy-efficient actions on federal buildings, which is something a lot of us have worked for, for a long time; put people to work doing that. That's one piece.

The second piece is -- that's about equivalent in size to the tax cut piece. So let's say, approximately 40 percent for that, 40 percent in the tax cut piece and approximately 20 percent in aid to the states.

So this is all approximate. But we don't have a number of the package. As you know, you've been hearing all kinds of estimates. And we don't know where we'll wind up: 500, 600, 700, a trillion. It's not clear.

Q (Off mike) -- tell the public --

SEN. BOXER: Well, I'm telling the public right now.

I'll say it again, what I know, everything I know: that the package is divided into three pieces, okay?

Q I understand.

SEN. BOXER: Investments, aid to the states, and tax cuts; 40, 40 and 20, approximately. I don't know what else you want me to say. I haven't seen the details. That's what I know, and that's what I'm sharing.

Q I have a question for both of you about the philosophy or maybe even about what is his approach. Do you as Democrats feel a responsibility to pass Barack Obama's agenda -- I mean, his package?

SEN. BOXER: Do you want to start on that?

SEN. REED: I'll start. I feel, as a representative of the people of Rhode Island, I have a responsibility to pass this package.

Q Beyond the -- beyond the stimulus, just sort of big-picture as you're coming into a very new environment here.

SEN. REED: We are in a situation of so much economic challenge that our focus has to be on this, and I think properly so, that President-elect Obama has focused on this economic issue. We've got to get this right. And it's about the American people, the economy. It's about the future of the country. It's about opportunities for the next generation of Americans. And we've got to move.

And I think that's the spirit that has to energize us now; not, you know, do we make the best impression, or who sort of takes the -- you know, takes the, you know, the -- the --

SEN. BOXER: Credit?

SEN. REED: Credit for it, et cetera. Thank you. (Laughter.) Thank you. I'm unwilling to take the credit.

SEN. BOXER: Yeah, I want to answer that, because I think it's really very important.

Q Will you use the other mike, please?

SEN. BOXER: I'm sorry?

Q The other mike.

SEN. BOXER: The other mike. Okay.

I want to answer it because I think it's a very important question. We're in extraordinary times, the most challenging time since the Great Depression. We need to fix things. We need to get it right. We need to restore confidence.

This time, this particular moment, is not about personalities, it's not about party, it's about country. And I will say this. I believe there is broad agreement across the country -- forget Senate, House and all of that -- that we must act. President-elect Obama understands that. In an unprecedented way, he has moved to address this before he even takes the oath of office. I don't remember anything like it. He's working with us on the details of how he's going to address this.

There is broad agreement among Democrats -- and I don't know yet about Republicans -- that this approach that he's taking is the right approach. Does that mean that every single line and every single paragraph will say, well, we can't make it better?

We may be able to make it better, and we're working with them.

You know, that's what the American people -- they want us to work with the president-elect. And that's what we are doing, in a very proud way.

Yeah?

Q Senator, it seemed after yesterday's meeting, though, that there's a lot of -- that there is a broad division in the Democratic caucus, that there's -- (inaudible) -- divisions. What we can we say -- is the bigger problem going to be the Republicans, or is it going to be maintaining cohesion among Democrats?

SEN. BOXER: I don't think there's broad division at all.

SEN. REED: No.

SEN. BOXER: Not even in the least. We're debating a couple of areas --

Q (Off mike.)

SEN. BOXER: Well, sir, you weren't in the meeting. So please, you're -- I'm telling you how -- I was there. Jack was there. There -- we are discussing some details around what tax cuts are best to stimulate jobs. That was most of it. We also expressed our view that we wanted to see a little bit more toward the housing side. Outside of that, there's broad agreement.

But we're there not to just give each other hugs and congratulate each other. We're there to take a look at where are some areas where we think this can be more effective. So please don't get the idea that there's some breakdown here.

Actually, it was a wonderful meeting. It was productive. They said they came to hear our ideas. Larry Summers, one of the words he uttered was, you know, "I get what you mean. I'm going to go back. I hear you. It makes sense." So this is cooperation.

SEN. REED: I would just add that there was absolutely no division of opinion on the need to act as quickly as possible and with a huge commitment of resources. The question, as Barbara -- was some of the approaches, relative to what is -- what is the better generator of jobs, what is the -- what was a better payback in terms of quick response to the economy. Those are important considerations, but they're dwarfed by the consensus, unanimity and desire to move quickly with a sizeable package.

STAFF: Last question.

Q Senator Boxer, you're talking about more investments in renewable energy. Can you elaborate on what you mean by that? What else might -- you might work besides -- (off mike)?

SEN. BOXER: Yeah. Well let me just say this: There's a lot in the package that addresses renewable energy in broad brush strokes. Tax cuts are in there, investments are in there. I think what you heard from some of us in a strong way is let's do a little more of that, you know, because we think that right now is the moment to move toward energy independence.

We look at places like California, where I could tell you right now we're suffering in this recession. But if we didn't have the environmental laws we have and we didn't see 400 new solar energy companies take shape because of the laws we have, and more wind and geothermal and putting people to work, we would be at, you know, double-digit unemployment right now, because a lot of the construction workers that got laid off from the housing industry went to work there. So it's not that they're not in the package; they're in the package; we'd like to see, some of us, a more -- and I think most of us -- a more robust move toward that.

But basically -- and I would reiterate exactly what Jack said -- when I came out of there, I felt really happy. We had a great meeting. We're going to continue it on Sunday. And they're listening and they're working with us.

And I would close with this. And I don't know how Jack felt about it, and I don't know if you heard the very opening statement of Larry Summers. It was the most brilliant description of what we're facing here.

And again, we'll close with the way we opened and how we agree; that if there are people here in the Senate and in the House who don't understand the gravity of this situation, then they don't have a heartbeat or a pulse, because it is grave.

We must act. We will act. And we are working together in the most cooperative fashion, and I think we're going to have a great, good product. And I'm very excited about working on it. And thank you very much, all of you.

SEN. REED: Thank you.

END.

Source