American Recovery and Reinvestment Act of 2009

Floor Speech

AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 -- (Senate - February 10, 2009)

BREAK IN TRANSCRIPT

Mr. RISCH. Mr. President and fellow Senators, I came today to make a few remarks regarding the vote we are about to have, in about half an hour, on the so-called ``stimulus'' package. I think everyone who is a Member of this body agrees with the magnitude of the problem. I have heard my colleagues on the other side and my colleagues on this side speak with great clarity and sometimes with great passion about the problem. Clearly, the American economy is in dire straits. Everyone agrees with that. The amount of passion that one speaks with neither raises nor lowers that level.

I heard the President of the United States last night say there were some people who thought there should be no action taken by our Federal Government. I am not aware of those people. I am sure there are some around, but I think most people agree the main responsibility of the Government of the United States is to protect its people, but closely behind that is to regulate monetary policy and economic policy. Nations have been doing both of those things for many years. My problem with the discussion we have had over recent weeks has been with the focus of the solution, and I believe the focus is misfocused.

The President agrees, we agree, and most economists agree that economic recovery will require a three-path solution. The first is attention to the banking sector, and that comprises two different parts. No. 1 is continued viability of our bank system; and No. 2, and most importantly, reestablishing credit flow, which is badly impaired at this time.

The second path is the housing sector. Most economists agree it was the housing sector that led us into this difficulty and it is going to be the housing sector that leads us out or, if it does not lead us out, at least it has to recover before we will see any decent movement in the economy.

And third is the Government expenditure item. That particular item has received all the ink, all the publicity, and all the discussion in recent weeks. The focus should not be on Government spending. The focus of the solution should be on credit flow and on the housing market, and it is not. To that, I object.

When the President very kindly came to the Republican conference, we had a spirited discussion on these matters. I was delighted to see that he agreed it was going to take a three-path solution to get us out of this. I was disappointed that his enthusiasm continued to be for the spending side, which of course is a very easy thing to do and something which this town is particularly adept at. Again, my problem is the focus. Spending by the Government is not going to resolve this problem.

This proposal has some job creation--that is the so-called "stimulus'' package--and for that I am grateful. The best example of that is roads and bridges. However, if you take a percentage of the amount of money we are talking about, that is only about 3 percent of the bill. There are lots of parts of this bill that do not do anything to stimulate the economy, and I am not going to spend time on that this morning, because they have been well publicized, and I have no doubt will be publicized more in the future.

The other difficulty with the bill, if you take the number of jobs the President is attempting to create or to protect, the cost is in the hundreds of thousands of dollars per job. That, as much as anything, shows how difficult it is for the Government to get us out of this by spending. It is a futile effort. We have between 7 and 8 percent unemployment in this country, which means over 92 percent of Americans are employed. What happens if unemployment continues to accelerate? The Federal Government cannot borrow or print enough money to salvage all those jobs at the cost of several hundred thousand dollars per job. The Federal Government simply can't do it.

Now, there is an entity that can do it. There is an entity that can create enough jobs and protect enough jobs. That entity is called the free market system. It is entrepreneurs, it is risk takers, it is capitalists. Those people and those entities created these jobs to begin with. They can do it again. That entity, the free market system, has created the most successful culture in the history of the world. For the free market system to operate, there must be free-flowing credit, and of course that does depend upon Government policy. That is why I come down on the side of needing to focus more on that particular aspect of this problem.

I listened to the President last night, and he talked about the $800 billion number. He said he did not reach up in the air and pull that number out of the air. I wish I knew where that number came from. I have yet to see the formula that was devised, either by the President or, more likely, his advisers who came up with this $800 billion figure. Indeed, that formula has a lot of value. If that formula could be put on paper, every economy in the world, every country in the world, would be very interested in that valuable commodity. Because if indeed you can simply take that formula and come up with a number and then borrow enough money and spend that money to get the economy moving again, this is very simple.

Here is the problem with all of this. That $800 billion number, or whatever number it turns out to be--and of course when you add interest in, it will be well over a trillion dollars, or somewhere in the neighborhood of $1.2 trillion--that money has got to come from somewhere. It is not free money. The way America is going to get that money is it is going to go out and borrow it. We all know what happens when America goes out and borrows money. Who provides us with that money? The major contributor of purchasing our debt is the Chinese Government and the Chinese people. There is no plan for repayment of that debt. What business in America, what entity in America would think of borrowing any amount, let alone an amount this size, without a clear and cogent plan for repaying that money?

Keynesian economics teaches us we can spend our way out of a problem. Keynesian economics has been proven over and over again to be a great theory, a wonderful theory, a source of hope, but it has been a total failure. It didn't work for the Japanese in the 1990s, it didn't work for this country back in the Great Depression, and it didn't even work last year, when everyone was given $600. It didn't even put a blip on the screen in trying to get us back to prosperity. Keynesian economics--government spending--to get us back on track, has never worked before and it will not work again. If it does work, it will be the first time in history, and it will defy uniform history that has shown us in the past that it won't work.

I hope when we go home during the recess time that this economy is moving in a different direction. I truly hope that is the case. And I hope we can be arguing on this floor whether it was this enormous spending package that did it or whether it was the vagaries of an undulating world economy, or whether it was economic policy dealing with the banking sector and the housing sector that turned it around.

I am encouraged by the fact the President has committed that he will turn his attention to the other two paths in this three-path system, the banking sector and the housing sector, after this package is passed.

The title of this bill, the ``economic stimulus'' bill, is truly a giant fraud on the American people. It is not a stimulus package. It is a giant spending package. Admittedly, there are parts of it that one could argue are stimulus, but it is so de minimis that one cannot call this an economic stimulus package.

Like everyone on this floor, I am concerned about the future of our children and our grandchildren. Borrowing $800 billion-plus, mostly from the Chinese Government and the Chinese people, and indenturing our children, our grandchildren, and our great-grandchildren to work to repay the Chinese Government and the Chinese people so we can spend that money today I believe is fundamentally wrong. I don't believe we should indenture future generations of Americans, and for that reason this Senator will be casting his vote ``no'' on behalf of the people of the great State of Idaho.

Mr. President, I yield the floor.

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