The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“TREASURY BOND YIELD UPDATE” mentioning the U.S. Dept. of Commerce was published in the Senate section on pages S6640-S6646 on June 16, 2009.
The publication is reproduced in full below:
TREASURY BOND YIELD UPDATE
Mr. SESSIONS. Mr. President, about 2 weeks ago I spoke on the floor about the unprecedented budget deficits this country is now facing and the fact we are spending money we do not have. I specifically discussed the impact that is having on Treasury yields.
What we know is that President Obama's budget has been scored by the Congressional Budget Office, which is our group, and I think they do a pretty good job. They take pride in being independent and fair. The head of it was selected by the Democratic majority in the Senate. It is certainly not a Republican organization. They are just fair, trying to do the best they can to try to calculate the numbers.
What they calculated was that at the rate of deficit spending we are now undertaking, the total American debt will double in 10 years, from
$5.7 trillion to over $11 trillion. In 10 years it will triple to $17 trillion.
That is a lot of debt. You might ask how do you do that? How do you spend more money than you take in? The way we do it is we borrow it, just like other people do. The Government borrows it. The way it does is, it puts out an auction or sale of Treasury bonds or bills, T-bills they call them, and people buy those things if they choose to do so, and the Government pays them a certain interest rate, whatever the interest rate is at the time.
On short-term debt instruments--short term are under a few months--
those interest rates are still rather low because people are panicked over the economic situation. They are afraid to put their money in the stock market, so they bought Treasury bills. Other people around the world did too. They are not getting much interest, but they believe the Government will pay them back in dollars, eventually.
So what has been happening to the 10-year Treasury bill, one of the foundations of our borrowing, is the rate has continued to go up. Two weeks ago, I pointed out that the 10-year Treasury yield had increased 54 percent this year, at that time from 2.4 percent in January, to 3.7 percent. Barron's, a major financial publication, predicted a few weeks ago that Treasury yields could top 4 percent this year.
Well, guess what. Treasury yields topped 4 percent last week. The Wall Street Journal in a front-page article on June 11 said that the 10-year Treasury yield briefly hit 4 percent yesterday afternoon before closing at 3.94 percent. That would be a 67-percent increase in the Treasury bill interest rate just this year.
Why are the rates going up? It seems there is some disagreement between Washington and Wall Street. The Wall Street Journal article says this:
Many policymakers see the rise in Treasury yields as a sign that investors are optimistic that the economy is on the mend. But many market participants say higher long-term bond yields indicate investors are increasingly worried about inflation.
So I interpret that to mean that the Washington politico crowd, looking to see a positive vision here, say it is because the economy is doing better. And that could be a factor. But the folks on Wall Street, who are buying the T bills, say differently.
Is the government responsible for this increase in interest rates? It seems that is a real possibility. The Federal Reserve is creating inflation concerns through its massive asset purchase program. The Fed plans to purchase $1.25 trillion in mortgage-backed securities, $200 billion in Freddie Mac and Fannie Mae debt, and $300 billion in Treasury bills this year. Since there are not enough people who want to buy the Treasury bills, the Federal Reserve is stepping in and buying them in an attempt to keep the rate down.
So far the Fed has purchased $481 billion in mortgage-backed securities, and $130 billion in Treasuries. The intention of the program is to reduce the Treasury yield and interest rates, but it may be backfiring. A Forbes.com article on May 28 quotes former Federal Reserve Governor Lawrence Meyer on how this kind of action could actually have a different impact. It could actually cause inflation and even cause a rise in the Treasury bond yield.
This is what he said:
This can become counterproductive. To the extent that you stoke inflation fears and you get an inflation risk premium built in [to the bond yield] you can't ease that away. You do have to be careful and more measured than that.
In other words, when there is a perception which may be reality that not enough people are willing to buy these Treasury bonds at lower rates, because they think even 4 percent may not be enough because they may fear that inflation is going to be 6 or 7 percent down the road, they do not want to lock themselves in for 10 years at a 4-percent interest rate that is below the inflation rate. So the Fed steps in and buys some of this to keep it low, and that may be having the perverse incentive of causing a belief to occur in the marketplace that inflation is on the way, and scares people even more.
Also let me say this about the voluntary purchase of Treasury bills by citizens of the United States, people in China, the Middle East, and around the world. They do not have to buy Treasury bills. We are going to be offering amounts, these kinds of bills, in volume we have never offered before in the history of the Republic.
So the question is, who wants to buy them? Who wants to hold a mortgage on the United States? What if we inflate our currency? Maybe 4 percent is not enough. Maybe they want more. Maybe China, which had a huge trade surplus a few years ago, is deciding they are not going to buy so many Treasury bills in the United States. Maybe they decide they need to invest in their own economy, which is not doing as well as it has done in the past.
The same about the Middle East. They used to have huge reserves of American money as a result of the high price of gasoline and price of oil on the world market. That price dropped some. So perhaps they do not have as much money to buy our Treasury bills either.
So who is going to buy them? We are not talking about a little bit, we are talking about going from $5 trillion in total debt today to $11 trillion in 5 years, and $17 trillion in 10 years. So we are talking about over $10 trillion in new debt we have to sell to someone in the world market.
Also, what is the impact of the Federal Reserve, that entity we have created by law, when they buy Treasury bills? What occurs there? I remember hearing Mr. Bernanke, the Federal Reserve Chairman, talking about this on ``60 Minutes.'' Some of you may have seen him being interviewed on that program. I went back and had the transcript of that program called up, and we reviewed it. It is what I thought he said. In response to reporter Scott Pelley's question, Chairman Bernanke said about the Fed's programs:
It's much more akin to printing money than it is to borrowing.
Mr. Pelley replied:
You've been printing money?
And Mr. Bernanke replied:
Well, effectively.
And he added:
And we need to do that, because our economy is very weak and inflation is very low.
So if you want to know the definition of printing money, that is it. Some people say that is not a fair thing to say; we are not printing money. Mr. Bernanke says we are printing money. He is the Chief of the Fed. He is the guy who does it.
Why does this matter to the average American? Even those who are not planning to buy a Treasury bill any time soon will be affected. That is because mortgage interest rates--what we pay to borrow money to buy a house with--track the 10-year Treasury yield. So as the 10-year Treasury goes up, mortgage rates go up too, and it is much harder for people to buy a home or to refinance. Or if you want to sell a home, it is harder for the person who wants to buy it to borrow the money. He has got to pay considerably more for a house in the interest rate. In fact, according to the Wall Street journal, 30-year mortgage rates have gone up 16 percent in the past 2 weeks, from 5 percent to 5.79 percent. This is the money, when you go out, you have to borrow money to buy a house with. What we need to happen in America is people buying homes and taking them off the market.
There is a huge difference between 5 percent and 6 percent. On
$100,000, 5 percent interest would be $5,000 a year you pay in interest; $400-plus a month. On 6 percent interest, it is $6,000 a year, or $100 more a month on $100,000. For a $200,000 mortgage it would be twice that. It would be $2,000 or $3,000 more a year you would pay in interest alone because the rate went up a bit.
We were hoping that the interest rates would stay low to encourage people to buy homes, encourage people to refinance, and be able to live a better life. The Wall Street Journal article said that this increase--from 5 to almost 6 percent--will cut the number of people with an incentive to refinance their homes and save money by paying less interest by half.
Let me mention one more thing. One of the things that is interesting in all of this is the impact our spending has had on the economy. We all hoped it would have a pretty dramatic impact. But it is not being nearly as effective as people thought. Even I thought we would have some impact in the short term.
But I believe that CBO is correct. When we passed the $800 billion stimulus package that was supposed to put money out into the economy to build roads and bridges, we found out only 4 percent of the money went to roads and bridges, 96 percent went to other kinds of government spending, but that $800 billion was supposed to create a good bit of jobs and get this economy moving.
I want to say things are not going as well as we would like. I remain optimistic. The Fed is doing all of these things, the spending is coming along. Surely we are going to have a benefit from that in the near term.
But this shows the deficit surge. The deficit, by which I mean how much more money we are spending than we take in. This goes through March of this year. You can see how the deficit is increasing, how much our shortfall is. And by March, it has already topped $953 billion.
That is more than twice the biggest deficit President Bush ever had. And he was criticized for his deficit. That is twice. We have not gotten to the end of the fiscal year yet.
What the CBO projects--this is our own Congressional Budget Office, their numbers, and they are running the tally of how much we are spending and how much is coming in. They calculate by the end of the year the deficit will be $1.8 trillion, which is about four times the highest deficit President Bush ever had.
I say that because people say: Well, President Bush had deficits too. Yes, he did. A lot of that was not justified, in my opinion. But we never had deficits like this in the history of the American Republic. And you do have to borrow this money.
This is in March. By September 30, we are looking at a deficit of
$1.8 trillion this year alone. And the whole debt of the American Republic, since its founding, is about 5.7 trillion before this year started. What is that? That is one-third in 1 year.
We hoped that spending and this activity would help improve the unemployment rate. But you can see, it is going up. It was 6.6 and it has gone up to 8.5. Well, it is not 8.5 percent. That was in March. The latest number is 9.4 percent.
So I do not know how much real boost we have gotten from this reckless spending. So much of it we knew was not job creating, and we debated that. It was clear that a lot of this was the kind of spending that would not create jobs. As I said, you heard about roads and bridges. Well, only 4 percent of the money went to roads and bridges. A lot of it went to all kinds of programs that are not job-creating programs. So I am concerned about that.
This is a vibrant country, and I think we have the capability of bouncing back from hard times. I will just say, we are at 9.4 percent unemployment. Unemployment in the early 1980s, under President Reagan, when they had to break the back of surging inflation, they broke the back of 13-percent inflation. Unemployment hit 10.8 percent. So it is not as bad as it was in the 1980s, and we bounced back from that, and we can bounce back from this.
But I have to say to my colleagues, if we do not have fiscal sanity in how we do our business, if we do not have a possibility of showing growth in revenues from economic growth and the containment of spending--and our deficits are surging for as far as the eye can see--
then I am not sure we will have the kind of healthy, robust resurgence we would normally expect to occur after a recession.
Look at these numbers. This is very disturbing. We borrow all this money, and we spend it today. I know a great lawyer who has written a book, ``The Case for Character.'' He said: This is a question of character, what I am going to talk to you about here. It is a question about the moral character of the Congress and the President of the United States and how we approach our duties in a responsible manner.
In 2009, this year, we expect that the taxpayers of the United States--on the $5.7 trillion we have borrowed--will pay $170 billion in interest. That is a total loss. That is money that goes out to people who have loaned us money. It is interest, just like on your credit card or on your mortgage--$170 billion. And look how it goes up. This is a chart I have of the interest each year. And 10 years from now, if we follow the President's budget, it will be $806 billion, according to the Congressional Budget Office.
All right. That is just money. How much is that? How much is $806 billion? Let me tell you what we do today. The Federal highway bill is about $40 billion. The Federal aid to education in all its forms is about $100 billion. So now, since we take money from the future, and we spend it today in a reckless way, I think, to get some sort of hope for stimulus we have not seen much of, we are going to saddle the people in 2019 with an annual debt payment of $806 billion--10 times the Federal education budget, 20 times-plus the highway budget. So we do need to be focused on this issue.
Let me say one more thing. According to the Congressional Budget Office, the deficit is supposed to drop down in 2 or 3 years, but already it looks as if we will not meet those numbers. The economy is not as strong as they were projecting. It was a rosy scenario. But they project about $600 billion is what the deficit will be 2 or 3 years from now--30, 40 percent higher than anything President Bush ever had--
$600 billion. Then it starts up again, and it goes up to the 10th year. And in the 10th year, under the scoring of the President's budget by the Congressional Budget Office, the deficit will be over $1 trillion in that year--$1.1 trillion.
That is not sustainable. And they are not projecting an economic slowdown. They are projecting modest growth over that period of time, solid growth for the last 5 years during this period. If we have a recession, presumably the deficits would be even larger than that.
I guess I would say to my colleagues, this is a matter we need to start thinking about. It cannot be ignored. Nothing comes from nothing. If you get money to spend today, you must spend every dollar of it with care because you have borrowed it from the future, and somebody has to pay it back. It is not free money. Maybe it feels as if it is free today because we did not have to pay higher taxes or we did not cut some other spending program to get the money to do what we would like to do with it. We just borrowed it. But borrowing has consequences.
Every year from here on out, that $806 billion will go up probably because in 2019 they expect not a balanced budget but an annual deficit of that year to be over $1 trillion. So the thing is going to continue to worsen. If we do not make some changes, this will continue.
By the way, this does not include the spending we are talking about on health care, which you heard a speech about earlier. I will say this about it: the Health, Education, Labor and Pensions Committee has released details on a bill. According to CBO, what they have released so far scores at $1 trillion. Oh, we just got another $1 trillion not calculated in these numbers. ``Well, everybody just needs to have health insurance.'' So who is going to pay for it?
We have to be smart. We have to see how we can improve health care, get more people insured, create a better system with the absolute lowest possible cost because we cannot continue this kind of reckless spending. Instead of learning a lesson from the already surging deficits, we seem to be blithely going on with a huge new spending program on top of that.
The American people, I think, are uneasy. They think we are out of control up here. They do not think they have ever seen anything like this: deficits the likes of which we have never seen in peacetime.
The U.S. Government passed a bill last fall that was supposed to buy toxic mortgages from banks, and now they bought a controlling share in General Motors. How did this happen? Did Congress ever vote on that? No. We did not vote on it. They took advantage of the language in that bill, which I was opposed to and voted against. One of the reasons I opposed it was because it was too broad and an unbelievable abrogation of congressional power to the Secretary of Treasury, who had already helped lead us into financial catastrophe. But people in panic, they all voted and gave him this power.
Did anybody know we were going to use that money to buy an automobile company? No. In fact, Secretary Paulson at one point was asked at a hearing: What about buying stock in banks? This was supposed to be helping the banks. In the House committee, he said, no, we did not want to buy stock in banks. But a week after that bill passed, he was buying stock in banks. And they have not yet begun to buy toxic mortgages. Maybe they will begin soon. They say they have a plan now.
I am saying the American people are right to be concerned about the reckless, irresponsible behavior of this government in Washington. I hope they will continue to watch what is going on. I hope the American people will speak out and let the folks up here know they expect us to do something more than deal with the problem next week. They expect us to be thinking about the long-term health of the American economy.
I heard a well-known financial expert say: Well, you know what? I am not saying there will be reckless inflation occurring, although some people are predicting that. He said: After President Reagan broke inflation and we got the economy on a sound track, the economy grew at about 3 percent a year and inflation was about 2 percent. He said: What I am worried about is that what we are going to see in the next 10 years is inflation at about 3 percent and growth at about 2 percent. That is not good. You want your growth to exceed the inflation rate.
I do not know what will happen. I cannot predict it. But I know this: We are going to have less money to spend on the things we need because we are going to have to be paying a huge amount in interest. Those are real concerns. This matter is not going away. I believe the American people are becoming more and more attuned to these matters. That is what the Tea parties were about--a sort of spontaneous reaction by the American people saying: What are you guys doing up there? Surely you know this is not the way to handle America's business.
I will say, I am going to continue to report on things that are developing. Surely we will begin to see some improvement in the unemployment rate and maybe some economic growth in the weeks to come. You would normally expect that when you pump the kind of money we have pumped into this economy. But in the long run, this begins to drag down the gains you make in the short run. That is what I am saying.
In fact, the Congressional Budget Office said--analyzing the stimulus package alone--it would increase our GDP, our growth for 2 to 3 years, but if you took that over 10 years, the economy would grow less over the 10 years than if we had no stimulus package at all. That is because when you borrow money, not only do you have to pay interest on it, but it crowds out borrowing from the private sector.
If a corporation wants to borrow money through the issuance of bonds, they are having to compete with the Treasury bills that are now paying 4 percent, and they will have to pay a good bit more because people think the Treasury bills are better, safer investments than some private corporate bonds. It hurts the private sector because now they are paying considerably higher interest rates to get people to loan money to them instead of loaning it to the U.S. Government.
I thank the Presiding Officer for the opportunity to share this. I hope and pray we can all figure out a way to work together to do a better job of being stewards of this economy. It is a high responsibility we have. No one knows everything. No one has a perfect answer to it. We are going to have to go through some tough times. I think that is clear, and there is no need to sugar-coat that.
I am not blaming President Obama for everything that has gone wrong, and he inherited so much of this. I have talked about Secretary Paulson. I do not think Secretary Geithner is any better. He was Secretary Paulson's top adviser when they came up with this plan last fall.
But, at any rate, we need to get our heads together and know one fundamental thing: Nothing comes from nothing. There is no free lunch. If you borrow money to spend today, there will be a cost in the future, and those costs can outweigh the benefits that are occurring today.
I thank the Chair and yield the floor.
The PRESIDING OFFICER (Mr. Kaufman). The Senator from Illinois.
Mr. BURRIS. Mr. President, we live in a world divided. International tension, mistrust, and even war too often separate Nation from Nation. But every 2 years, 10,000 athletes from more than 200 countries come together to celebrate the human spirit. They meet in competition, arriving on the world stage from all five inhabited continents. Each of these five continents is represented by a single-colored circle--a ring intertwined with four others to form the familiar symbol worn by every Olympic athlete. The Olympic and the Paralympic games are a powerful force for world unity and a boon to any city that hosts them.
In 2016, the summer games will bring millions of dollars and the international spotlight to one of four world cities. Selected by the U.S. Olympic Committee from a broad field of candidate cities, Chicago is one of only four finalists for the 2016 Olympics, along with Madrid, Rio de Janeiro, and Tokyo. The International Olympic Committee will make their final selection this October.
We must work hard to bring the Olympic games back to the United States. There is no greater honor than representing your country on the world stage. I am convinced there is no greater city in the world than Chicago.
As President Obama and I can both attest, Chicago is a diverse and inclusive city. Situated on the banks of the beautiful Lake Michigan, it is the jewel of the Midwest. Chicago has always been a global leader in culture, art, architecture, commerce, sports, and even cuisine.
The Olympic spirit is alive and well in Chicago. The Chicago 2016 Olympic Committee recognizes the importance of the games and in renewing old friendships around the world, as well as establishing new ones. This ideal and the value of the ``friendship through sports,'' is at the heart of the city's Olympic bid. It is a city I am proud to call home, and it showcases much of what makes this country so great. That is why it is the ideal site for the Olympic and the Paralympic games.
For the athletes, world-class training facilities and event locations would be very close together, allowing for convenience and ease. For visitors, outstanding public transportation and modern infrastructure would make all events readily accessible and easy to attend. For residents of the city and people across the United States, Chicago would shine on the world stage, and millions of dollars would pour in from across the globe.
Especially if we pass S. 1023, promoting travel to the United States and relaying better information to visitors, Chicago will be the clear choice for the International Olympic Committee in October.
This important legislation, known as the Travel Promotion Act of 2009, would create a nonprofit corporation as well as a government Office of Travel Promotion. These organizations would work together to encourage business, leisure, and scholarly travel to the United States, restoring important components of our struggling economy.
Travel and tourism, which generates as much as $1.3 trillion in the United States every year, has been on the decline since 2001, although the same industries have grown in many other countries. We must act swiftly to protect the 8.3 million American jobs that are directly related to travel and tourism. This means welcoming more overseas visitors each year--visitors who already spend $142 billion inside the United States on an annual basis.
An increase in international tourism would increase the profile of the Chicago Olympic bid. The 2016 Olympics, in turn, would generate even more international tourism in Illinois and across the country. S. 1023 would help this massive influx of visitors travel into the United States with ease. This would create jobs, increase tax revenue, and build stronger friendships across the globe.
There are few international spectacles as singular and as inspiring as the Olympic and the Paralympic games. A force for unity in a world divided, these competitions have the power to bring us together as one people, celebrating the human spirit with one voice.
I urge my colleagues to join Senator Dorgan and Senator Enzi in supporting S. 1023. This legislation would help to bring visitors from all over the world to the United States and would also help bring the 2016 Olympics to Chicago, IL, because I have a special interest in bringing those Olympics to my hometown.
Thank you. I yield the floor and I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant bill clerk proceeded to call the roll.
Mr. UDALL of Colorado. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. UDALL of Colorado. Mr. President, every year thousands of people travel to Colorado to enjoy some of the most exciting recreation opportunities in the world. Although my home State is known for its skiing, we are a summertime destination with 4 national parks, 5 national monuments, and 41 State parks for travelers to enjoy. Visitors can go white-water rafting down the Colorado River or hike and climb in the magnificent Rockies. We have Wild West ghost towns, historic railroads, and American Indian cultural sites to visit.
Obviously, travel and tourism is an incredibly important sector of Colorado's economy. For every $1 million spent in Colorado by domestic and international travelers, 11 jobs are created. Travel and tourism generated $13.7 billion in revenue in 2007 in Colorado alone, and almost 150,000 Coloradans owe their jobs to that industry.
That is why today I rise to express my support for the Travel Promotion Act of 2009. I am a proud cosponsor of this bill, which has strong support from Members across the aisle, and I look forward to voting for its passage later this week.
While I have listed just the beginning of the numerous reasons to visit Colorado, the truth is that our tourism and travel industry has suffered in recent years. Many people do not realize it, but across our great country our tourism industry never fully recovered after September 11, particularly when it comes to travel from outside our country into the United States. That compares with this fact: Travel around the world has dramatically increased in the past decade while travel to the United States has dropped. In 2008, we welcomed fewer visitors to our country than we did in the year 2000. Why? Part of the problem is that visitors from overseas have been confused by the new procedures for entering our country. Foreign visitors also say they don't think we are making much of an effort to attract international travelers. That is costing communities across our country billions of dollars in lost revenue. In fact, one study suggested over $182 billion has been lost since September 11, 2001.
In my State of Colorado, the travel and tourism industry is a strong economic engine. It is one we have to keep strong and in which we have to invest. Part of that is in changing the perception that the United States is not interested in hosting foreign tourists. That is the point of this legislation. The legislation before us would help revive international travel to the United States so we can get that economic engine revved up to its full capacity.
The purpose of the bill is to sell travel to the United States to overseas tourists, including areas that are not well-known destinations. Of course, the Presiding Officer's State is also a place where we want to attract people to its wonderful beaches and wonderful historical sites in the great State of Delaware.
Let me tell you quickly some of the details in this legislation. It would establish a Corporation for Travel Promotion which would be an independent, nonprofit corporation governed by an 11-member board that the Secretary of Commerce would appoint. It would create an Office of Travel Promotion in the Department of Commerce to develop the programs to increase the number of international visitors to the United States. And it would set up a travel promotion fund which would be financed by private-public matching dollars. Much of the cost would be borne by international travelers who would pay a $10 fee collected through the electronic system for travel authorization.
Other countries are spending billions of dollars on travel promotions. Those of us who sponsored this legislation and hopefully will vote for it overwhelmingly at the end of this week think we should stay competitive with other countries. The Travel Promotion Act would directly contribute to the economic recovery of our travel and tourism industry. It would spur job growth, and it would contribute to the tax base of local, regional, and State governments, many of which are forced to make, as we know all too well, drastic cuts in this tough economic time.
As well, before I close, I wish to mention that there are nonfinancial benefits to international travel as well. I wish to quote that great American Mark Twain. He said:
Travel is fatal to prejudice, bigotry, and narrow-mindedness.
America's image in the world, as we know, has suffered greatly over the past several years, but travel to our country, to America, is one of our most effective tools of public diplomacy. Studies have shown over and over that when people come to our country, they return home with a very positive view of not just our country as it is described in the books but the landscapes and the people and the way we live our lives. In addition to helping strengthen our economy, this bill would strengthen our place in the world.
I end by thanking and acknowledging the chairman of the Commerce Committee, Senator Rockefeller, the ranking member, Senator Hutchison, and Senator Dorgan for quickly bringing this legislation to the floor. I look forward to the passage of the Travel Promotion Act so we can continue to get travel and tourism and, of course, our economy back on track.
(At the request of Mr. Reid, the following statement was ordered to be printed in the Record.)
Mr. ROCKEFELLER. Mr. President, once tourists come to West Virginia, they often return. From the Appalachian Trail to the Monongahela National Forest, the beauty of our State is unparalleled and our people are welcoming.
Tourism in West Virginia also creates jobs. As a result, our State spends money to promote West Virginia in the surrounding States as a tourist destination. But we surely would welcome more international tourists as well.
Increasing overseas travel and tourism is a shovel-ready economic stimulus that will create thousands of jobs across the country--
including West Virginia. With the dollar at a low compared to other currencies, America is a bargain. We are open and ready for business. Unfortunately, the rest of the world doesn't know it.
Compared to other countries, the United States fails to effectively advertise and promote itself overseas as a tourism destination. In 1992, the United States attracted 9.4 percent of all international tourists; in 2007, the United States attracted only 6.8 percent. Since 2000, the United States' share of international travelers has declined by 20 percent.
Meanwhile, the rest of the world is promoting itself--often employing the best Madison Avenue techniques used for marketing heart medications and luxury cars. We all see enticing television advertisements to visit Italy, Greece, Jamaica, Ireland, Canada, Australia and Brazil. But few residents of those countries see advertisements enticing them to come to the United States--and to spend their money in the United States.
If the United States had simply kept pace with global travel trends, 58 million more overseas travelers would have visited the United States between 2000 and 2008. Those travelers would have generated 245,000 tourism jobs in 2008 alone.
The average overseas visitor to the United States spends $4,500 per visit. That means every 23,000 overseas visitors pump $100 million into the U.S. economy.
We have spent billions of dollars to prevent the collapse of industries and billions of dollars to put people to work. But today, through the Travel Promotion Act of 2009, just $10 million will plant the seeds for leveraging private sector investment to increase the number of U.S.-based tourism jobs.
Americans always have had a healthy skepticism about the role of government--what it should do and what it shouldn't do. To promote travel and tourism, we have long thought that the private sector--the companies that make money from tourism--should promote themselves. And some of the larger private sector players have promoted their specific interests overseas.
But a private sector effort to fund a general ``Come to America'' campaign targeting overseas travelers has never fully materialized. When a resort or theme park spends advertising money overseas, they want the viewers to visit their destination, not just the United States. Some of our larger States promote themselves overseas. But, as you would expect, the advertisements entice foreigners to visit their States.
As a result, potential tourists overseas may not be aware that the United States has far more to offer than California, New York, and Florida. They likely have never heard of hiking, rafting, or fishing in the mountains of West Virginia. For anyone who has not enjoyed those activities in my State, you are really missing something special.
Because the hotels and tourist destinations of States like West Virginia cannot effectively launch their own international promotional campaigns, we must find a mechanism to pool and leverage resources so that these States become part of the international tourism economy.
After the terrorist attacks of 2001, the subsequent security measures deterred overseas tourists. Many of those entry problems have been corrected now. But the negative perception still remains. Potential foreign tourists still are reluctant to deal with what they believe will be a difficult time entering the United States. No private sector company--and certainly not the hotels and tourist destinations in the States I have mentioned--will spend their own money to promote the improved process for entering the United States. Only a national, coordinated campaign--with some help from the Federal Government--can accomplish that goal.
We have occasionally appropriated one-shot advertising campaigns to promote the United States overseas. But the Travel Promotion Act of 2009 will create a sustained and stable public-private sector partnership in which Federal seed money is leveraged to increase private investment to promote tourism overseas.
The bill would establish a travel promotion fund that is capitalized by a $10 fee paid by foreign travelers from visa-waiver countries. The bill would require the travel industry to match those contributions--50 percent in 2011 and 100 percent thereafter. The fund would receive $10 million in Federal seed money for 2010. The new fee for foreign travelers would cumulatively provide the means to lure them to the United States, but is too small to have any impact on an individual's decision whether to come to the United States.
The funds would be used for overseas advertising campaigns to promote travel to the United States, including to areas not traditionally visited by overseas tourists. More importantly, the advertising campaigns would educate potential foreign travelers about U.S. visa and entry policies. Removing fears about entering the United States would dramatically increase tourism among overseas residents who might consider a range of vacation choices. If foreign tourists better understand U.S. entry and visa policies, the more likely it is that they will come to the United States--and the more likely it is that they will spend their money here, creating the jobs we so desperately need.
Drug companies and luxury automakers spend billions of dollars on advertising for one reason: it works. The State of Florida estimates that its own State travel promotion campaign returns $3 in increased sales tax revenue for every dollar spent on promotion. The countries advertising foreign tourist destinations on American television every night would not spend the money to do it but for one reason: it works. The United States--with so many spectacular destinations--must embark on its own worldwide promotion program because it will work.
A sustained and stable tourism promotion program is a small investment that will generate huge dividends when foreign tourists spend their money in the United States, generating jobs and local revenue. Foreigners visiting the first time have the potential to become repeat visitors and will tell their friends to visit as well.
In addition to stimulating jobs, we will improve America's image around the world through tourism. People who visit the United States are more likely to have a favorable opinion of America when they return home. Developing that kind of good will in a changing world makes travel promotion worthwhile.
I would like to thank the sponsors of this bill: Senator Dorgan, Senator Inouye, Senator Reid, Senator Klobuchar, Senator Begich, Senator Mikulski, Senator Bennet, Senator Udall of New Mexico, Senator Udall of Colorado, Senator Ensign, Senator Martinez, and Senator Vitter.
America is open for business. The people who work in our tourism industries are ready to work. Now we need to tell the world.
vote explanation
Mr. DURBIN. Mr. President, on vote No. 208, had I been present for the vote, I would have voted aye on the motion to invoke cloture on the motion to proceed to the Travel Promotion Act of 2009, S. 1023.
Jefferson Award Recipients
Mr. KAUFMAN. Mr. President, I rise to honor this year's winners of the annual Jefferson Award for Public Service and particularly four winners from my home State of Delaware.
The Jefferson Awards were created in 1972 to serve as a kind of Nobel Prize for voluntarism and community service in America. Named for our third President, whose embodiment of our Nation's spirit of community and service continues to inspire, these awards are presented annually for both national and State winners.
The mission of the State Jefferson Awards is to recognize unsung heroes in our communities who give their time and their care in service to others. On the national level, Jefferson Awards are bestowed upon those who have contributed significantly to advancing these principles. Past winners include Colin Powell, Bill and Melinda Gates, Oprah Winfrey, and Sandra Day O'Connor.
This year, four outstanding Delawareans have won Jefferson Awards. They have contributed to voluntarism in the ``First State'' through innovative programs and a dedication to inspiring their fellow citizens to service.
Elaine Chester, of Wilmington, has won a Jefferson Award for creating a program through the Delaware Division of Family Services to help low-
income children receive new, wrapped holiday gifts. She matched local children in need with Delmarva Power employees interested in sending gifts.
Over the last few years, under Elaine's leadership, this program has expanded to become one of the largest corporate gift drives in Delaware. It benefits hundreds of children annually, including those who are terminally ill. Since its expansion to nursing homes, the elderly now receive gifts from Delmarva Power employees as well.
Leonard Young, also of Wilmington, earned his Jefferson Award for his tireless promotion of public health and wellness initiatives. His encouragement of others to get regular preventive health screenings has led many Delawareans to incorporate healthy living into their daily routines.
Leonard has spent a great number of hours educating youth about the dangers of substance abuse and how to prevent violent behavior in relationships. He is a leader in the community, and his involvement in various public health endeavors is far-reaching.
I am especially proud that this year's national winner of the Jefferson Award for Outstanding Service by a High School is the Salesianum School in Wilmington, DE. Its efforts were led by two seniors, Robert Liszkiewicz and Dominic Taglione.
The two led their classmates in an effort to increase youth voluntarism, and they gave their time to mentoring local students, volunteering with the Blue/Gold Foundation for Delawareans with intellectual disabilities, and helping at the local Ronald McDonald House for families with children undergoing medical treatment. The efforts of Robert, Dominic, and their fellow students at Salesianum have established a lasting program for youth voluntarism based on the principles of the Jefferson Awards.
I am privileged to have the opportunity to meet Elaine, Leonard, Robert, and Dominic at a Senate reception today honoring Jefferson Award winners from across the country. I hope my colleagues will join me in celebrating their achievements, their commitment to serving local communities, and their embodiment of that greatest American quality of service above self.
I yield the floor, and I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. CARDIN. Mr. President, I ask unanimous consent the order for the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Kaufman). Without objection, it is so ordered.
Mr. CARDIN. Mr. President, I ask unanimous consent that I be permitted to speak as in morning business.
The PRESIDING OFFICER. Without objection, it is so ordered.
IRANIAN ELECTIONS
Mr. CARDIN. Mr. President, as Chairman of the U.S. Helsinki Commission, which has had decades of experience monitoring election and promoting democracy and human rights, I would like to take a moment to speak on a troubling matter that has filled headlines around the world in the last few days.
We have all seen the images. Violence and mass protests are erupting across Iran following the hasty vote count of a deeply flawed presidential election process in that country. Yet another unfortunate chapter is unfolding before our eyes that reinforces Iran's record as a police state and totalitarian regime more concerned with keeping its tight grip on power than yielding to the will of the people.
I stand with President Obama calling for the government to exercise restraint and the violence to end. Regrettably, at least seven people have been killed and countless others injured. We may never know the true results of this election, given the lack of international monitoring. But what we do know is that in the last few days we have witnessed tens of thousands of Iranians raise their voices in protest to ensure that their vote meant something.
On Friday, voters in Iran lined up in unprecedented numbers to choose their next president. I, like many others, was dismayed on Saturday to hear the ruling clerics rush to announce that Mahmoud Ahmadinejad had won reelection by a large margin. Regardless of the limited official scope of his duties, President Ahmadinejad's consistent pattern of noxious remarks and his belligerent attitude inject understandable tension around the Middle East and beyond. He has used the presidential podium to instigate conflict with the international community, pursue acquisition of nuclear weapons, and spew hatred and intolerance toward Israel and the United States.
I cannot say and will not say what could have been or should have been if any other candidate was elected, but there is no doubt whatsoever as to Ahmadinejad's unfitness as a leader.
Equally troubling were the almost immediate reports coming from Tehran and elsewhere around Iran that there were deep flaws in this election. Elections do not equal democracy, nor do they guarantee that the will of the people will be reflected in their government. But this was not a free and fair election from the start.
In Iranian Presidential elections, only a select group of candidates approved by a 12-person Council of Guardians are eligible to run. The Iranian regime, headed by Supreme Leader Ali Khamenei, continues to severely restrict civil liberties including freedom of speech, expression, assembly, and association. Freedom to discuss ideas without threat of oppression is a fundamental human right that is essential to a government truly reflecting the will of its people. This freedom is absent in Iran. Typically, Iranian elections and public expressions are carefully monitored and manipulated by the ruling regime to prevent challenges to their authority.
The last few days seem somewhat different. The tens of thousands of people lining the streets of Tehran--in an incredible rebuttal to the ruling powers--want to know that the votes they did cast are counted properly. The deliberate lack of transparency in the vote tabulation and the blatant attempts to block mass communications among citizens, particularly youth, are too glaring to ignore. Even Supreme Leader Khamenei has been forced to backtrack on his immediate approval of the results and has called for at least the appearance of a recount in some disputed areas.
Americans know something about wanting to have their votes counted accurately. The difference between our two nations: when the results of a U.S. election were in dispute, the world spotlight shined bright on the process and the people involved in resolving the conflict--
peacefully. Transparency and openness is not a hallmark of Iranian elections.
Even before the presidential election took place, Iran's totalitarian regime blocked personal communications like texting and access to the Internet. Media have been confined to Tehran, if they haven't been asked to leave the country. The regime's ongoing attempts to curtail communication and silence protests--often with brutal force--
demonstrate the regime's fear of losing a grip on power.
Allegations of a fraudulent vote count are a symptom of a regime that has survived by an authoritarian power structure that oppresses its people. On June 12, the people of Iran did not vote for the Supreme Leader of their country. Under the current system, the Supreme Leader and his supporters will continue to dictate policy to the President of Iran, regardless of who that president is and whatever policy decisions the president is authorized to make.
The people of Iran want their voices to be heard and they should be assured that the world is listening. I urge those in power in Iran also to listen and implement the reforms necessary to allow the will of the people to be expressed.
I look forward to a future when the people of Iran have an opportunity for a free and fair election of leaders of their choosing. It is my sincere hope that one day this vision will be realized, and the voice of the Iranian people will truly be heard.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. REID. Madam President, I ask unanimous consent that the order for the quorum call be rescinded.
The PRESIDING OFFICER (Mrs. Shaheen.) Without objection, it is so ordered.
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