Hearing of the House Budget Committee - Concurrent Resolution on the Budget for FY 2016

Hearing

"Thank you, Chairman Price.

"As we gather today, we are facing some good news, some bad news, and some very bad news.

"The good news is that the economy is improving and more Americans are working. The private sector has now added 12 million new jobs over the last 60 months. It's not all rosy -- many Americans are still looking for work, but the unemployment rate has fallen to 5.5 percent and trends are good.

"The bad news is that Americans are working harder than ever, but their paychecks are flat. This is not a new problem -- it has become a chronic problem that dates back to the 1970s. As this chart shows, there has been a growing gap between the increased value workers are creating in the economy and the size of the paychecks they are taking home. Worker productivity is up; paychecks are flat lined.

"So where is the value of that hard work going? Well, income gains from increased productivity have gone overwhelmingly to those at the very top of the income scale, the top 1 percent. It's no wonder that so many people I talk to in Maryland and across the country feel like they are running in place or falling behind.

"Right after the last election, there was some hope that Republican leaders understood the problem. Speaker Boehner and Republican Senate Leader McConnell wrote in the Wall Street Journal that they were humbled by the opportunity "to help struggling middle-class Americans' and deal with "wage stagnation.'

"But with today's Republican budget, the country gets the very bad news -- they were just kidding.

"This Republican budget is very hard on hard-working Americans and those looking to find a job. It says work harder, take home less. It will do nothing to increase the paychecks and take-home pay for working families. In fact, it squeezes them even more. It will increase the tax burden on millions of families -- those in the middle class and those working to join the middle class. Amazingly, it cuts higher education tax credits and ends the boost in the child tax credit. Millions of Americans will lose access to tax credits for affordable health care.

"The cuts in students' loans and Pell grants will make college less affordable and add to the already huge levels of student debt. Seniors who have worked hard for a financially secure retirement will immediately have to pay higher Medicare premiums, bigger co-pays for preventive care, and much higher costs for prescription drugs.

"While this budget raises costs and further squeezes hardworking families, students, and seniors, it paves the way for the Romney-Ryan plan to cut the tax rates for millionaires. It is based on the tired and disproven theory that we can grow our economy through trickledown economics. That theory ran aground in the real world under President Bush -- the only things that went up were the incomes of the already wealthy and the deficit. Everyone else fell behind.

"While this Republican budget will immediately make life harder in the daily lives of working families, it also disinvests in America's future. It slashes the part of the budget we use to invest in our kids' education -- from early education to K-12 and beyond. It is a sad day when we start chopping away at the ladders of opportunity in America.

"It will also devastate the investments America has made in scientific research and innovation -- investments that have helped power our economy and keep us at the cutting edge of technology.

"And it provides no solution to address the shortfall in the federal transportation fund that will result in construction slowdowns beginning this summer.

"By the way, when I say this budget disinvests America's future, it is not rhetoric -- it is a mathematical reality. Take a look at this chart. This budget slashes our investments to a level that is almost 40 percent below the lowest level as a share of the economy since we have been keeping records.

"And keep in mind that despite these devastating cuts, the Republic budget doesn't balance -- not by a long shot. As we will see later in this debate, it takes budget quackery to new heights. It claims to repeal the ACA, but relies on its revenues and savings; it doesn't account for the costs of the almost $1 trillion in business tax cuts that Republicans have called for; and it plays a shameless shell game with our defense spending. It would make Enron accountants blush.

"Most Americans would agree that the policies in this Republican budget -- cutting tax rates for the wealthy while increasing the tax burden on working Americans, raising costs for students and seniors, and cutting vital public investments -- will simply stack the economic deck even more heavily in favor of the very wealthy and very powerful, and make it harder for everyone else to get ahead.

"We can do better, much better, and next week Democrats will propose a budget that promotes a more rapidly growing economy with more broadly shared prosperity. That is the right direction for America."

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