The American Economy
Floor Speech
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Mr. TONKO. I thank the gentlewoman from Ohio. Thank you very much for kicking us off on a wonderful hour of discussion as to a plan to revitalize our economy and to grow the opportunities for our working families across this country.
President Obama has ushered forward a wonderful package called the American Jobs Act that will enable us as an American society to respond to the crisis for jobs and to the crisis for economic recovery, all of which are incredibly valuable to the future of this country.
We need to invest, I believe, in a way that allows us to provide the tools that are essential for a modern-day economy and modern-day manufacturing.
This proposal stands in sharp contrast to the work done a decade and a half ago, a decade ago.
What was done then is this spending frenzy that paid for tax cuts for millionaires and paid for tax cuts for billionaires and bought wars in Iraq and Afghanistan and offered a pharmaceutical plan for the Medicare program, all without having a payment mechanism.
And so this spending frenzy, which was tremendous, it was a huge bill for the American public, had been done off budget and had no funding sources. There were no pay-fors, as they are addressed today.
The contrast here with the President's proposal, with President Obama's proposal, is that there is an offering for relief for America's working families, for her middle class strata, with a payroll tax reduction extension, and that enables both employers and employees to realize the savings that then allow us to put together a balanced approach on assisting the economic revitalization of our working families and middle class, and on providing the investments that are essential in going forward, automating our manufacturing concepts in providing an inducement for an ideas economy into the equation of success for this country.
That all requires investment. And so as we look at this plan that is very balanced and paid for, we know that we can compete in that global market if we're given the appropriate revenues to invest in a modern manufacturing concept. Keep in mind, certain sectors were totally avoided by the Bush administration. No focus on agriculture, no focus on manufacturing, a focus on the service sector of the economy, but they are narrowly on the financial services.
We all know the saga there. We know the scenario all too well, that avoidance of a watchdog, turning our back so that there could be this laissez faire approach that brought America's economy to its knees, and we saw the displacement of 8.2 million jobs.
That was painful and impacted people in tremendously profound measure, and people lost their lifetime savings through those failures. Housing values went down. They plummeted and, again, 8.2 million jobs were lost.
So we have an opportunity, Representative Kaptur, as you've talked about an extension of the payroll tax holiday, we have an opportunity here to not only provide for savings, for our families, but for investments in a modern world manufacturing model that enables us to, again, utilize the strength of research, the strength of technology, the strength of ideas that can then bridge into a new threshold of manufacturing opportunities in this Nation, and then, of course, the investment in the human infrastructure where we train and retrain workers for that automated phase that comes in manufacturing.
So, I thank you for bringing the focus tonight on the floor of the House of Representatives to what we call in our caucus a progressive agenda for revitalizing the economy, and emphasizing, underscoring the concept of making it in the USA, making it in America, putting a focus, again, onto the manufacturing base.
I represent a host of communities dubbed mill towns. They were the economic engine for an industrial revolution. They were the epicenters of invention and innovation that led to this westward movement that enabled us to impact not only the growth of this Nation in favorable measure, but to impact the quality of life in peoples around the world simply by our spirit of pioneer, which is within our DNA to make a difference in the product delivery, in the quality of life that's addressed by that product line.
I'm filled with optimism. I'm filled with optimism if we move to go forward in a way that invests in the American worker, invests in the American business, small business, and invests in our ingenuity and our innovation.
Thank you so much for the discussion.
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Mr. TONKO. Representative Garamendi, thank you again for bringing us together with this request for a Special Order.
If Representative Kaptur could just take us back to that second chart that she shared with us earlier this evening and the measurement or the depiction of real average after-tax income.
Now, you talk about the unfairness out there or the inability to go forward and tax fairly. When you look at that graphic, to see the injustice that's displayed just in simple line graph format, that flatlining of America's middle class from 1979 forward, that flatlining contrasted with that steep climb upward for those in the upper income brackets tells us the whole story.
And people have said across this country, when I go home to the district, people say to me that they're concerned, they're upset. They've been taught, rightfully so, they've learned along the way that if you play fair, you roll up your sleeves and you abide by the rules that you should be able to have within your grasp that American Dream. The American Dream, one that allows for working families to climb the ladder. They don't feel that that's within their grasp today.
And it's not only the injustice here that is measured on a chart--and be mindful, they don't reject the notion of working hard and scoring big, making money. They're not concerned about that. They honor that. What they're concerned about is the undue influence that the powerful have, those sitting perched high on the income ladder, the power they have with the process and the policy outcomes. And the fact that we would avoid fairness in revenues and not invest in the American Dream, not invest in opportunity, not invest in the prosperity of this Nation is what bothers them. They don't want to be ignored that way. They want to know that a process out there, there's a government working to create policies that initiate a comeback, that enable people to have within their grasp the American Dream. That's what they want to know is alive and well here in Washington.
And now it's a fight. It's a fight for the Democrats in this House to score a victory for the middle class. We want that victory. We want people to be able to know that there's a fairness out there. Look at it, $1,800, $1,500, whatever your strata would produce as a favorable outcome is something for them. Month to month they will score some victory here where the essentials, as Representative Kaptur labeled them, are available to them with these savings. Contrasted with opportunities that we see here that find this group that's rising to the top exponentially just won't share the prosperity in that way.
And I think it's the avoidance of sound progressive policy that's really the struggle right now. And people are expressing their anger and their frustration, and rightfully so, because we need to be more fair.
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Mr. TONKO. Let me just talk about a point of clarification, too, to add to that discussion.
On this whole tax fairness, people have approached me. They've said, Now, explain to me--because they hear different scenarios. They were imagining that there would be this tax, this surcharge on $1.2 million. For instance, if you're over that $1 million threshold and you have an annual income of $1.2 million, the people are now reminded that it's on that $200,000 over and above the first $1 million upon which the surcharge is levied. You know, that's an important fact that is sometimes lost in the discussion. So now people are saying, Well, wait a minute; so the first million dollars isn't taxed.
Mr. GARAMENDI. Same tax rate, doesn't change at all.
Mr. TONKO. Right. And so they're saying, Well, whoa, we've been flatlined for so long, and this exponential rise for the highest in the income ladder's outcome.
Mr. GARAMENDI. Surcharge is only on the amount over $1 million.
Mr. TONKO. So now there is more determination by America's middle class families to have it fixed and done correctly.
And the other thing is, I'm reminded, every time I go home, by middle class Americans, modest household incomes, that: We're job creators. My children needed my attention at home. I opened a childcare in my home. I charge. I have a small business.
Many small business people tell me, as an idea came to mind, they now wanted to turn that into a product. They're small business owners. They're the engine. They're connected to the community. They're tethered to the small community.
Mr. GARAMENDI. Can I interrupt for just a second?
The American Jobs Act, which we're trying to push through this Congress to get men and women back to work, provides a tax reduction for the employer on wages less than $50 million. So for your childcare provider, for the small business person, the carpenter out there in the small business, they also get a 50 percent reduction in their payroll tax. So instead of 6.2, it goes to 3.1. So this isn't just for the wage earner. This is also for the business person.
Mr. TONKO. Exactly.
Mr. GARAMENDI. So why don't they support this?
Mr. TONKO. You know, this is a statement of underpinning of support for middle class, for working families, for small business. It's the engine that's making it happen.
Small business, the investment we can make, not only the tax cut we can provide here, but the investments that are required for the ideas to move along. We're in a challenging time. We're there competing in a global economy. We invest in the intellectual capacity of this Nation, and how foolish of us not to take that investment, that product of that investment and put it into working order. That's what we're asking for here.
Give small business the tools, give working class families the opportunity, and we will have a comeback story that is glorious, and we should be filled with optimism if we do the things that are so logical, and that polls across America, individual polls from all sectors, all angles, all different groups that measure, they're saying this is what America wants. And how come they can't get it delivered by their government?
They're speaking to us loud and clear through their opinion surveys. We want this progressive schedule. We want this agenda. Make it happen. We're trying here as the Democratic Caucus in the House of Representatives, Representative Kaptur, to make it happen, and I think we can if we put our minds to working together in a very, very bipartisan, bicameral way, executive branch working with the legislative branch, vice versa, and making a progressive agenda happen.
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Mr. TONKO. So many of these programs, including the longstanding Medicare program, are looked at sometimes in dollars and cents and argued about how they're improved or not improved. But sometimes lost in the whole discussion is the value added, the whole underpinning of support that is offered the senior community.
Prior to the inception of Medicare in 1965, families that retired were probably going to see their economic well-being dip precipitously. And what they had here, with the Medicare Foundation, was that their economic stability, their dignity factor, was addressed in tremendously strong and powerful ways so that they were able to move forward in those retirement years with that sense of dignity, with the quality of life, with economic stability.
These are facts that need to be maintained in the front of any discussion; that to undo Medicare would be a tragedy for American families, for our seniors. And certainly, let's go forward, as we have said, with optimism. Let's invest in Medicare. Let's invest in Social Security, and let's invest in an economic recovery where we cut where we can, belt tighten, but invest where we must so we can compete effectively.
And to my colleagues on the floor here tonight, Representative Kaptur, Representative Garamendi, I join with you in being a powerful voice in promoting optimism as we go forward, and wanting to have progressive change.
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