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“NEED FOR AN ECONOMIC STIMULUS PACKAGE” mentioning the U.S. Dept of Labor was published in the Senate section on pages S397-S398 on Feb. 6, 2002.
The publication is reproduced in full below:
NEED FOR AN ECONOMIC STIMULUS PACKAGE
Mr. BYRD. Mr. President, over four months after the idea was originally proposed, the Senate remains divided on an economic stimulus package.
Much has changed since an economic stimulus was first proposed in response to the September 11 attacks. Both the stock markets and the economy have proved to be more resilient than economists had expected.
Moreover, there are signs, as Federal Reserve Chairman Alan Greenspan told the Budget Committee last month, that some of the forces that have been restraining the economy over the past year are starting to loosen their strangle hold. The Fed Chairman told the Committee that ``while 3 months ago, [a stimulus package] was clearly a desirable action . . . I do not think it is a critically important issue to do. I think the economy will recover in any event.''
Aside from the positive economic data that have been released by government agencies in recent weeks, there is already a significant amount of stimulus in the pipelines.
That's not to say that we are home free. As Chairman Greenspan pointed out last month, the economy could go either way at this point. Most troubling is the higher unemployment rate since last year.
However, we must not delude ourselves into thinking that an economic stimulus package--whether crafted by Democrats or Republicans--is some sort of panacea. Stimulus packages can't work miracles. We have a $10 trillion economy. That's gross domestic product--the total of all spending. We cannot flip the economy over like a pancake. A boost of
$70 billion to $100 billion would amount to less than 1 percent of GDP.
Nobody can say at this point with certainty in which direction the economy is headed.
What we know is that, since the recession began last March, the Labor Department reports that 1.8 million workers have lost their jobs. We could address this problem by temporarily extending unemployment insurance.
What we do not know, is whether a more comprehensive stimulus package at this point is really necessary.
I submit that the danger we face is not that the economy won't turn around--inevitably it will--but that we may unnecessarily worsen our budgetary position by taking unnecessary, but politically popular, action on a so-called ``stimulus package.''
Any stimulus package, at least in the short-term, will increase the projected budget deficits for fiscal years 2002 and 2003. We may well need to devote more resources to our military overseas and to homeland defense, and we will have to bear the costs of doing so.
The erosion in the budget picture over the past year, along with the defense and homeland security demands placed on our budget and the inevitable long-term Social Security and Medicare deficits overshadowing the retirement of the baby-boomers, suggests that tough choices must be made as to whether the limited dollars we spend will provide a worthwhile return on our investment. From what we have seen from experts ranging from the Federal Reserve Chairman, to Congressional Budget Office officials, to private-sector economists, a stimulus package does not meet that test.
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