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Stimulus = Bailout Baloney

February 9, 2009

Floor Statement of Senator Michael B. Enzi

On the American Recovery and Reinvestment Act

February 9, 2009

Ladies and gentlemen, my colleagues, people of America…the emperor has no clothes! Somebody has to say it.  I’m referring to this additional bailout, this spending bill that spends everything we've got on nothing we are sure about.

I’ve watched with dismay and disgust as this stimulus package ballooned from $800 billion to more than $930 billion in just four days of debate. And today, my colleagues tell me I’m supposed to be giddy that we’re only spending $827 billion?  Frankly, I’ve had enough of this bailout baloney.

Members from both sides of the aisle are simply taking advantage of taxpayer “shell shock” and a strident sense of national urgency to pump the recovery package with wasteful spending and unending tax provisions that blatantly fail a crucial yet simple test set by my Democratic colleagues: that the provisions of the stimulus bill should be targeted, timely and most important, temporary.

For example, this bill includes billions of new money for federal agencies. Presumably these agencies will hire new workers with that money. What happens at the end of this fiscal year when the funding for these new hires goes away?  Will these new jobs be eliminated?  Of course not!  Lawmakers will simply come back to this well in a few months and exert even more pressure to maintain the new programs and keep these new jobs – and keep the bloated spending that supports them.  There is nothing “temporary” about this kind of spending.

There’s also nothing temporary about much of the programmatic spending included in this bill either.  For example, the “compromise” includes $13.9 billion in additional funding for Pell Grants to help college students pay for college costs.  I’m a strong supporter of Pell Grants, but we provide funding for them in the normal appropriations process, and we are kidding ourselves if we think that after this stimulus bill we will be able to return Pell Grants to their pre-stimulus level.  If we try to go back to that funding level, we will be accused of trying to make college unaffordable. 

The same goes for the I.D.E.A. program, which receives $13 billion in the “compromise” to improve education for disabled children.  If we suggest that the I.D.E.A. program goes to its pre-stimulus level, we’ll be accused of cutting funding for disabled children.  These are both good programs, but they should be funded in the normal appropriations process because they are not “temporary” spending increases.  That's $26.9 billion!  That used to be big money around here.

And, while this bill does not include traditional earmarks, we should all understand that there are earmarks in this bill.  There’s an $850 million earmark to bail out Amtrak, a $75 million earmark for the Smithsonian, and a $1 billion earmark for the 2010 census.

In addition to that, thousands of the projects that will be funded from this bill are what the American people would consider to be earmarks.  For example, the “compromise” includes $1.2 billion for Byrne Grants that will go to local law enforcement agencies to be spent on basically whatever they desire.  This bill is not a stimulus package – it is another bloated appropriations package.  That's another $3 billion that used to be real money around here.  I wish I had time to cover the thousands of other spending Ideas we wouldn't fund in the past.

I think it is ironic that Congress spent last fall criticizing subprime mortgage lenders who sold over-valued homes to people who could not afford them – and created this mess we’re in – when we are committing the very same sin today with this “stimulus” bill.  This chamber is guilty of trying to sell an over-valued, bloated spending bill to taxpayers who can ill-afford the price tag. But unlike those homeowners who just left the keys and closed the front door, the American taxpayer doesn’t have the option of just walking away when this bill comes due.

It is time to admit that just like many Americans, the federal government has maxed out its credit card.  But while most Americans are wisely trimming the fat in their budgets, re-examining their spending patterns and focusing on what is truly essential, Congress hasn’t smartened up yet.  Now is not the time to put every politician’s Christmas wish on the government credit card. We’re already approaching the debt ceiling with alarming speed.  In fact, I’ll bet most Americans don’t know that buried deep within this stimulus bill is a provision to raise the federal debt limit to $12.1 trillion.  Let me repeat that: 12.1 trillion dollars! An increase of over $830 billion.

The American people want Congress to act now, to act with urgency.  We don't have time to wait.  That's what the party in charge is telling us.  My reply is, do we have time to get it right?  The American people don't want us to go fast for the sake of being fast, they want us to solve the problem and they want a solution that makes sense to them.  That's what will give the American people confidence and confident American people are going to make our economy better, not the federal government throwing their money around with reckless abandon.

Don’t get me wrong, I understand the immediate need to jump-start our economy.  The employment numbers released last week were stark evidence that jobs continue to disappear at a fearsome pace.  People are frightened and they feel they have nowhere to turn.  But in steering a ship through a crisis like this, Americans need to be confident that lawmakers have a steady hand on the tiller and a firm eye on the horizon.  And it’s clear from the sinking poll numbers that this stimulus bill gives them no such confidence.  Americans have had enough bailout baloney too. 

What we need is a new plan and a new approach.

Alice Rivlin – a former OMB and CBO director – suggested that we split this bill into smaller pieces and I agree. And some of my colleagues agree too.   Our first priority should be an “anti-recession package” that can be both enacted and spent quickly.  Elements of this bill should meet very strict criteria:  the funds must spend out completely or expire by the end of this calendar year; the funds cannot be used to support permanent obligations like entitlements or operating budgets; and the funds must be targeted at specific needs.

A second, separate set of packages could be considered after the completion of the anti-recession package.  These smaller bills would include funds for longer-run investments that are needed to enhance the future growth and productivity of the economy including infrastructure investment, education, and worker retraining.  Rushing this type of spending through, as we’re doing in this bill today, ensures that mistakes will be made, plans will be poorly crafted and precious taxpayer money will be wasted. 

This bill’s ability to create jobs is dubious at best.  And when combined with the outrageous cost of past bailouts for Wall Street and the automakers and bailouts "yet to come" for the banking and housing sectors, the only sure thing about this bill is that taxes are going up for everybody: working Americans, senior citizens, businesses small and large, and our children and grandchildren.  No one will be spared the cost of this stealth expansion of the welfare state.

I simply cannot support a future tax increase the size that this bill implies.  I plan to oppose this bloated bailout and I urge my colleagues to do the same.