Congresswoman Nancy Pelosi

Pelosi Statement at House-Senate Hearing on Bush Economic 'Stimulus' Proposal

January 21, 2003

Washington, D.C. -- House Democratic Leader Nancy Pelosi gave the following opening statement this morning at a hearing sponsored by the Senate Democratic Policy Committee to examine President Bush's economic "stimulus" proposal:

"Thank you, Senator Dorgan, for your leadership in holding this hearing today and for bringing together the House and Senate about an issue of grave concern to the American people. I am pleased to be here with John Spratt, who is not only the Ranking Member of the House Budget Committee, but also a member of the House Leadership as the Assistant to the Minority Leader. He has played a critical role in putting together the economic stimulus package that was proposed by the House Democrats earlier this month.

"We all know that the economy is failing, and the American people are looking for leadership. The first order of business for this Congress -- after protecting the American people -- must be to jump start our economy and create jobs now. Instead, Republicans are proposing long-term tax cuts that do little to stimulate the economy in the short term, while exploding the deficit as far as the eye can see.

"The Administration has already tried to boost the economy with tax cuts that focus on the wealthy. It has not worked. Look around you. Total job loss during the Bush presidency has soared to over 1.7 million jobs -- the worst record on job creation since the end of World War II.

"Democrats have made job creation the focus of our plan. Over 1 million jobs will be created this year under our proposal. According to the White House’s own figures, the President’s plan will create fewer than 190,000 jobs, less than one-fifth of what the Democratic proposal will create this year. Most of the President’s so-called 'stimulus' will occur at the end of the decade. We need a stimulus now, not in 2010.

"The House Democratic Caucus has proposed a stimulus plan that is fast, fair, and fiscally responsible. Our plan is fast in that it provides an immediate boost of $136 billion in 2003, sparking economic growth and creating jobs now. Our plan is fair because it puts money in the hands of the working families and small businesses that need it most. Finally, our plan is fiscally responsible. It has a 10-year cost that is one-seventh what the president is proposing, allowing our budget to recover as our economy recovers.

"President Bush fails to meet these three vital criteria. Instead of a fast-acting plan that boosts the economy now, the bulk of the provisions will occur after 2003. Instead of fairly impacting all working Americans, the vast majority of the President’s plan’s benefits will go to the wealthiest 5 percent. And instead of being fiscally responsible, it will explode the deficit over the next decade just as the Baby Boom generation becomes eligible for Social Security and Medicare.

"In addition, President Bush has ignored the needs of the states in his plan. One can only conclude from looking at his plan that he has forgotten about the states. While our plan provides over $31 billion in targeted assistance for state and local health, homeland security, and infrastructure needs, the president’s plan actually worsens states’ fiscal outlook by eliminating the tax on dividends. Most states base their tax payments on the figures used by taxpayers on their federal forms, and would therefore collect less under the Bush plan. Unless we address the needs of the states, their budget shortfalls will dampen the stimulative effect of any efforts we make here in Washington.

"Millions of working families are struggling in this economy, and those families will tell you that we need to do something different. Democrats are listening. The President is not.

"The Republican excuse for eliminating $2.5 billion in homeland security funding for first responders, port security, border security, and nuclear security, is that we have a 'wartime budget.' The President’s excuse for not helping families by investing in their children’s education and fully funding the No Child Left Behind Act is that we are in a 'wartime budget.'

"The Republicans’ excuse for failing to ease the fiscal burden on the states is a 'wartime budget.' Their excuse for a proposed $300 million cut in heating assistance, which will cut off 532,000 low-income people in the middle of the coldest winter since 1976, is a 'wartime budget.'

"And yet there is room in their 'wartime budget' for a tax cut of $88,000 for people who make more than a million dollars a year.

"The President’s priorities are clear. He has already passed a huge tax cut for the wealthiest. It has not worked. Now he wants more of the same.

"The plan Democrats are proposing will grow the economy by providing stimulus now, not a decade from now. It helps all Americans, not just the wealthy. And it gives the economy a short-term boost without sacrificing long-term fiscal responsibility.

"Thank you to our witnesses, and to you, Mr. Chairman, for holding this important hearing. I look forward to the witnesses' testimony."