Sept. 16–A tenuous situation is how U.S. Sen. Tom Harkin, D-Iowa, describes the current national economy. “We could be facing a long not recession but depression, and we shouldn’t make the same mistakes that were made in the last big Depression when people were trying to balance budgets and do all these things, and we found out that it was making the depression worse,” Harkin said during a conference call with reporters on Thursday.|By Christinia Crippes, The Hawk Eye, Burlington, Iowa
Sept. 16–A tenuous situation is how U.S. Sen. Tom Harkin, D-Iowa, describes the current national economy.
“We could be facing a long not recession but depression, and we shouldn’t make the same mistakes that were made in the last big Depression when people were trying to balance budgets and do all these things, and we found out that it was making the depression worse,” Harkin said during a conference call with reporters on Thursday.
He offered the history lesson of President Franklin Roosevelt’s New Deal, a federal investment in direct employment programs, and credits those spending efforts as bringing the country out of the Great Depression.
Harkin sees the current “mindless march to austerity” as history repeating itself, and points to recently released U.S. Census figures on poverty — 46 million Americans, or 15 percent of the population and 22 percent of children, live in poverty, according to new data from 2010 — to remind people of the good government can do.
“The new census bureau report reminds us that government assistance plays a crucial role in sustaining working and middle class Americans. For example, Social Security alone kept 20 million Americans above the poverty line, (and) unemployment insurance kept another 3.2 million Americans above the poverty line,” Harkin said.
Rather than deep cuts now, Harkin favors long-term deficit reduction and short-term and immediate spending to boost jobs. And he points to, of course, an effort not unlike, albeit bigger than, the one President Barack Obama proposed in the American Jobs Act just last week.
“In his speech to Congress last week, President Obama made a powerful pitch for exactly this course,” Harkin said. “The new poverty numbers reinforce his argument that job creation must be our number one national priority.”
He argued it is time for Republicans and the so-called super committee aimed at finding deficit reductions to get on board. The New York Times reported some Democrats are balking at the president’s plan, and Harkin said the president should be talking to them to win them over, but he’s more concerned about the Republican roadblocks.
Harkin’s concerns are valid, as his colleague U.S. Sen. Charles Grassley, R-Iowa, said earlier this week the only part of the president’s proposal getting bipartisan support is an effort to extend the payroll tax cuts. Even if that proposal does go forward, Grassley sees better alternatives being proposed by his Republican colleagues.
“This short-term fix of a one- year payroll tax thing can’t hold a candle to other tax policy (changes) that would be long term,” Grassley said.
Grassley said permanently extending the 2001 and 2003 tax cuts — that were extended again for two years by Obama in 2010 — would be among his priorities.
“I bet if he would just do the tax policy thing right now, you’d see the stock market shoot up right away,” said Grassley, who argues uncertainty in business is keeping them from hiring people.
Grassley’s other top priorities include Harkin’s fear of immediately continuing to bring the nation’s deficit down, rather than spending efforts. Grassley said he also would like to see three trade agreements go through — something he does expect to happen — and a two-year moratorium on new rules and regulations to help kickstart the economy and get people back to work.
Though Harkin’s history lesson suggested there could be a double-dip recession if the government continues to contract, Grassley said he would have to see more proof of that before he would consider short-term efforts to boost the economy.
“There’s more people talking about that possibility now than before, but it’s not, it’s not convincing to very many people in Congress yet,” Grassley said. “Business, small and large, need long-term policy before they’re willing to gamble hiring new people, and so his (the president’s) more spending, more borrowing, more taxes isn’t going to do it. But we’re ready to work with the president.”
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(c)2011 The Hawk Eye (Burlington, Iowa)|
