John Garamendi

Mr. GARAMENDI

Mr. GARAMENDI. I ran over and got this chart. I wasn't going to talk about this this evening, but you brought the issue up about where the money has gone and the issue of tax breaks. This chart begins in 1979, and it shows the basic growth in income. So it starts down here in 1979, and the bottom 20 percent have really seen very, very little growth in their income. The next 20 percent, a little better, and this is the next quartile. These are the 1- percenters. We talked about the 99 percent. This is the 99 percent down here. These are the 1-percenters. These are the people that have seen extraordinary income growth. And it just happens to coincide right here, this income growth has coincided with the Bush tax cuts in the early 2000's. So we've seen this enormous percentage income, almost a 300 percent growth, 277 percent growth in their income, so that you're beginning to see the skewing of wealth in America. This is the annual income. But if you take a look at wealth and you put another chart of wealth here, you'll see something the very same. So the rich get richer and the poor stay where they are, that old song. Here we are. This is a result of multiple effects, but one of the principal ones is tax policy. And if Mr. Ryan's budget passes, as you have suggested, and the top tax rate goes from 39 to 25 percent, then that means that those who already have a lot will get a whole lot more. And I'm reminded of a quote by Mr. Roosevelt, President Roosevelt, and he said--this is a paraphrase. I wish I had it with me to be exact. He said: We're not measured by how much those who have get more, but rather by what we do for those who have little. This is our great challenge. This is where the great buying power for America should be, in the bottom 99 percent, really in the bottom 50 or 60 percent. I thank you for raising that point about the tax policy in the Ryan budget, but it will make this line just continue to go like that; and the rest, because of the elimination of the deductions, are going to see a stalling of their income.

Mr. GARAMENDI. If not now, when?

Mr. GARAMENDI. When are we going to do it? We can do these things. We can do the wind turbines for the clean energy, as Mr. Delaney was talking about, solar panels, and, of course, the transportation systems, which we're discussing here.

Mr. GARAMENDI. George Washington and Alexander Hamilton at the very start of this Nation said, Build the infrastructure. Grow the economy.

Mr. GARAMENDI. Well, thank you very much, Representative Norton, and for your years of service here. You were just moving to the Ryan budget, which I suspect he'll introduce maybe in the next day or two. This is the same old, same old, but this time it's worse than the old. He's talking about an austerity budget, a very stringent austerity budget on steroids that will clearly decimate the economy as those cuts are made. You just said if the Federal Government makes a reduction, it comes right down to cities and States laying people off. We've had this growth just last month, 247,000 jobs, and here we go. Let's understand what is being discussed by Mr. Ryan. Who are these people on Medicaid? He proposes to cut Medicaid by a third and block- grant it to the States, which means just give the States some money. But who are those people on Medicaid? Now, we call it Medi-Cal in California, but you can see that two-thirds of the Medicaid money goes to seniors and disabled. So, Mr. Ryan, what are you doing? Who exactly are you pointing out for the reductions? You're going after seniors and the disabled.

Mr. GARAMENDI. Mr. Higgins, you've raised, and Mr. Ryan, you've also raised the very same issue about the infrastructure. We can do this. We can really do it. I couldn't believe that Paul Ryan's going to introduce a budget in the next couple of days that's going to take $5.7 trillion out of the infrastructure. I often hear our Republican colleagues talk about the Founding Fathers, and we ought to hearken back to the founding fathers. And indeed we should. His first month in office, George Washington asked Alexander Hamilton, his Treasury Secretary, to develop an industrial plan for the United States. In that plan that Hamilton produced 3 months later was an infrastructure component. It said the United States Government should support the creation of ports, canals, and roads. So right back to the very first days of this government, we have seen the role of the Federal Government in the infrastructure sector, and that is an investment. And one thing I'll add before I turn it back to you gentlemen is that all of that's our tax money, all tax money from all 360 million Americans, coming in in one way or another, sometimes through the Federal excise tax on gasoline or income tax or other taxes. If we used that money to buy American-made steel--I think that's near your district, isn't it, Mr. Ryan?

Mr. GARAMENDI. We can use that again. The President has put it out there, too. In his State of the Union speech he spoke very clearly to the advanced manufacturing centers that you talked about, Mr. Ryan. He talked about infrastructure. He's made proposals that have just been pushed aside by our Republican colleagues here, but there are proposals that would grow this economy and give us the foundation upon which we can then have additional growth. I see that the Representative from the District of Columbia is here. Ms. Norton, thank you very much for joining us. Gentlemen, thank you very much for this evening. Eleanor Holmes Norton, thank you very much for joining us this evening.

Mr. GARAMENDI. So we're talking about American-made steel for those bridges, or concrete or other kinds of equipment. And so if we do that, we'd create jobs in the United States. The manufacturing sector lost 9 million jobs between 1990 and last year. This last year we've seen an additional about 600,000 new jobs coming back into manufacturing, but if we pass Buy American or Make It in America legislation, so that our tax money supports American-made products from American-made workers made in America, we can see a boom in manufacturing. It's certainly going to be important in my district, and I'm sure it is in yours. Gentlemen, you're right on target here. These are the investments that George Washington and Alexander Hamilton said we ought to make. Mr. Ryan, I know you have a few other things you'd like to toss into this.

Mr. GARAMENDI. Mr. Higgins, if I may interrupt you for just a second, I can't believe the number you just gave us. You said the Ryan Republican budget that will come out this week does what to infrastructure?

Mr. GARAMENDI. Mr. Higgins, you've really hit upon something that caught my attention. Also, we should be aware that this year, that is October 2012 until October 2013, we will spend $100 billion in Afghanistan. To what effect? To have our soldiers killed by Afghan policemen? To create an ongoing conflict in that area with the people that are living there? To what effect? $100 billion. You talk about bringing home the soldiers, we should bring the soldiers home from Afghanistan. There will be some small unit left there to deal with al Qaeda and other terrorist organizations, but it's simply not working. Think what $100 billion could do to solve the sequestration issue, which is only $85 billion.

Mr. GARAMENDI. They think it's welfare. Well, these are seniors and disabled people that can't work, or people that are retired. So, what does it mean? It slashes that budget for seniors that provides them with nursing homes. Principally, these folks are in nursing homes. So you're going to take a third of the money out of nursing homes. Now, just what are those seniors going to do? What are they going to do? You're taking a third of the money out by 2022. You mentioned Medicare. Oh, yeah, Medicare. Mr. Ryan, proposes to end Medicare as we know it. He's going to give seniors a voucher. They can stay on Medicare, but they have a voucher to buy Medicare. The guarantee of affordable health care, quality health care for seniors terminates with the Ryan Republican budget. Who are those people on Medicare? Well, let's see. About 3 percent earn over $100,000 a year; 1 percent, somewhere around $90,000 to $100,000; but down here, here's where the Medicare beneficiaries are. They're earning somewhere, $10,000 to $20,000, or $30,000--right here, 28, 20, 16. You're getting up to 50 percent right there of people below $40,000. These are not wealthy people. Medicare is there to provide people with the ability to have quality health care in their retirement years. But Mr. Ryan would end that and give them a voucher, and shift the cost to the individuals who would then have to go out and buy private health insurance. I was the insurance commissioner in California for 8 years and I understand what the private insurance companies are all about. The private health insurance companies are all about their bottom-line profit. It's not people, it's profit. If that's what Mr. Ryan wants to do, we're going to fight vigorously and successfully to say no, no; the promise of Medicare is here to stay.

Mr. GARAMENDI. Mr. Higgins.

Mr. GARAMENDI. So share with us your thoughts about how we can grow the economy, and maybe share some of your own experiences, because you've employed many, many people during your tenure in business.

Mr. GARAMENDI. Mr. Speaker, thank you very much. I am John Garamendi from California, and I am joined by several of my colleagues here tonight. We want to go through a couple of things that are of the utmost importance to Americans. I had three townhalls on Saturday in California--it was about a 450-mile drive to get to all three of them--but at each and every one of them the concerns were very, very similar. The first overriding concern was the economy. In California, there is this desire to get the economy going. There is a pent-up energy in the people--in the businesses, in the small businesses, in the farmers. It's not just because it's spring and the almonds are blossoming--or maybe it's the ``a-munds'' depending on what part of my district you're from. It's that there is this desire to get moving forward. They keep asking me, What's going on in Congress? Why can't you guys get it together out there? And we explained what's happening here. We have been through five crises over the last 18 months-- manufactured crises, things that didn't have to happen. Each and every time, the entire system of America's economy and politics comes to a stop, and we lurch up to that fateful cliff, and then we move on but not with the kind of robust energy that this economy is capable of. We need to get this continuing resolution and all of these fiscal cliffs out of the way to get the economy moving, and there are some very, very good examples of why the economy is poised to take off. One of them is found here. If you take a look at this chart, these are the job creations or losses beginning way back in 2009, 2008. All of those red lines are the collapse of the economy. When the blue came in, that's when President Obama came in 4 years ago, and things were tough. We were in a free fall here in our economy; but with the stimulus bill, we began to climb out. After about 18 months, we began to see positive job growth--we were no longer seeing those job losses-- and we've seen that all the way through. This last month was a terrific month. There were 247,000 new jobs created, and that was in February. So what happens in March? In March, we come up against another cliff; and now we have sequestration, leaving us 750,000 unemployed Americans. It's not a gain in the economy. The unemployment rate went down to 7.7 percent in the previous month, and now we have sequestration. We passed a bill out of here last week that was supposed to solve it. It really didn't. In fact, it maintained sequestration. It took care of a few things, but we've got to get past this. We need to grow this economy, and we need to make the investments. There are really only five critical investments that need to be made year after year after year, and we need to do these things repeatedly--every month, every year, in every budget: Education--sequestration cuts education at all levels; Research--sequestration cuts research. In my district, at the University of California at Davis, $45 million of research projects will come to a screeching halt. Ph.D.s and others will be laid off; Infrastructure--sequestration cuts infrastructure. Manufacturing matters. You've got to make things; Those are the four. The fifth is you have to be willing to change, but you've got to change in a positive way. What we're going to talk about with my colleagues here is this issue of how to move the economy forward. As we look at the past and at the success--modest, not enough, but on the right track--we need to keep in mind that it is the role of the government, dating back to George Washington and Alexander Hamilton when Washington asked Hamilton to develop an industrial plan for the United States and Hamilton did. He laid out in that plan the critical role of government in moving the American economy forward, and that was in the very first year of these United States. We should carry that tradition forward. So as we go into this, let's keep in mind that we've made progress and that we have much more to do. Joining me tonight is a gentleman who has created many, many jobs, and now he has a new one. He is a Member of Congress from the great State of Maryland, and it's Mr. Delaney. Thank you very much for joining us. You have an exciting district. You have a considerable amount of high-tech in your district.

Mr. GARAMENDI. Also joining us tonight is Representative Higgins from the great State of New York. We have talked here on the floor from time to time, Mr. Higgins, and you have a very serious issue about our infrastructure--or lack of good quality infrastructure in the United States. You have some plans for that. I don't know if that's what you want to talk about tonight, but I'm going to take you there either sooner or later. So please share with us your thoughts on growing jobs here in America.

Mr. GARAMENDI. Thank you very much, Mr. Delaney. Well, you hit it right on the head: education, the technology issues that we have before us, the issue of globalization and how we deal with it here, and our energy policy. We are really blessed in the United States with energy that has suddenly come back to blossom, and that's natural gas. What an enormous asset for this country, and we need to really push that further along. And the immigration issue, all of these things are before us right now. If we move forward aggressively with the kinds of things that you talked about, and we're spending time here on the floor, we can really move this country. And with the energy that businesses have and the experience that you know from your own experience in business, there is a pent-up demand. There's a lot of cash in the businesses of the Nation. We need the policies laid out there. Perhaps you can take up the energy piece and elaborate a little more on how you see the use of natural gas as a bridge as you get to those clean energy issues that you talked about.

Mr. GARAMENDI. I really agree with all you said. And as we make that bridge to that clean energy future--you talked about those 50-year increments as we change from one source of energy to another. In that process, we, American taxpayers, seriously subsidized each and every one of those transitions. We now have to shift, it seems to me, shift some of those subsidies from the old energy sources, specifically oil, and shift that into long-term subsidies, encouragement to those clean energy issues. If we do that, I think we'll see that kind of growth that you're talking about.

Mr. GARAMENDI. Exactly right. When I was young, before Medicare, we lived in a rural community, there was a county hospital. My dad took me to the county hospital to visit a rancher. We were ranchers. On the other side of the hill was another rancher that was elderly and was at the county hospital. I will remember forever in my life going to that ward with maybe 15, 20 elderly people side by side in beds, the stench. The care was almost nonexistent. Poverty was everywhere. It was worse than horrible. But in 1964 this Nation did something very, very important. Together with Social Security, they brought seniors out of poverty because it was the medical expenses that forced them into poverty. So Medicare brought seniors out of poverty. It went from, I don't know, I think it was almost 80 percent of seniors were in poverty to a situation today where maybe 8 to 10 percent are in poverty. Social Security, Medicare; absolutely critical. But any attempt to change that goes right to the heart of our values as Americans. We will take care of our seniors. That's not to say changes are not possible. Of course changes ought to be public. For example, we ought to be negotiating with the drug companies over the price of prescription drugs. But, oh no. When the prescription drug benefit was passed, added into it and signed by George W. Bush was a paragraph that said the Federal Government is a price taker; it cannot negotiate the price of drugs. So we spend billions and billions where it's not necessary.

Mr. GARAMENDI. Mr. Delaney, I know you have to leave, but thank you so very much for joining us.

Mr. GARAMENDI

Mr. GARAMENDI. Mr. Speaker, I move that the House do now adjourn.

Mr. GARAMENDI

Mr. GARAMENDI. Mr. Speaker, the climate is changing. Climate change is very, very real. You only have to look at the superstorms we have had, Sandy and others, and the $180 billion of destruction that has been wrought upon us from the environment just over the last 2 years. The climate is changing, and there's something we can do about it. In fact, there's something this House of Representatives must do about it, and that is to move forcefully, directly, and aggressively to clean energy policies. We ought to be subsidizing those clean energy systems that are out there--solar and wind. In my own district in Solano County, we have one of the biggest wind farms. My own history goes back to 1978, when I authored legislation for State tax credits. We can and we must deal with climate change, and we can do it with clean energy policies.

Mr. GARAMENDI

Mr. GARAMENDI. I rise today to tell the story of how northern California communities that I represent will be harmed by sequestration. Travis Air Force Base in my district makes sure that the equipment and personnel that our military needs are delivered quickly and safely around the world. They're the world's first responder when disaster strikes. Thirty-two hundred civilians will be furloughed beginning next week. They will have a loss of some $30 million of income over the next 6 months. Near Marysville, California, Beale Air Force Base operates an intelligence, surveillance, and reconnaissance mission that supplies our Nation's military with timely information to save American lives on the battlefield. Fourteen hundred civilians will be furloughed, with $13 million in lost wages. Families and their income are important. But so is national security, which will be compromised by sequestration. Yuba City, one of the major places in the United States prone to flood problems, will see their critical levee protection that the Army Corps of Engineers is working on delayed and not completed for next winter's floods. The University of California-Davis will similarly be harmed. It's time to end sequestration, and I ask unanimous consent that H.R. 699 be brought up for a vote.

Mr. GARAMENDI

Mr. GARAMENDI. Well, we have a little bit more time. I think it's about time for us to wrap all of this into one piece. And I will take the first shot at it, and then if you would be so kind as to finish it up. I'm thinking of Chicago. It's not my territory. It's a long way from California. It's a beautiful city, a very dynamic city. At the turn of the previous century, in the late 1800s, they had an architect, a city architect, Burnham, and he wrote: Think no small thought for it stirs not the heart of man. Very interesting. We ought to add women to that equation now. But what he said is that when we rebuild this city, we need to build big. We need to think bold thoughts. We need to think about the greatness that could exist if we step forward. Earlier in the previous hour we heard about the exact opposite. We heard about inward, thinking small, we are not going to reach out and fulfill the great potential of this Nation. Instead, we're going to retreat. We're not going to allow government to be part of the greatness of our future; but, instead, we're going to make it smaller and less viable. And those five things that I talked about, education, that's a public investment. Infrastructure is both public and private. But the public side is critical. You look at manufacturing, manufacturing has always been private; but it has also relied upon the public sector. And if we use our tax dollars to buy American-made products, we are causing the manufacturing sector to grow, to blossom and to innovate and to be even greater than it is today. In developing the research, that's both public and private, but it is largely a public sector investment. So we can deal with this by investing, by thinking boldly about what it is we can do and, in doing so, make certain that everything we invest in publicly is necessary, that it is run efficiently, and that its outcome is effective, and that it fulfills the goal for which it was designed. Those should be our watchwords: efficient, effective, necessary, and bold. Think no small thought. This is America. This is the world's greatest country perhaps ever, and it was created by bold thinking, both public and private working together in a synergy that created this incredible Nation. I'm excited. I'm excited here in the very early days of the 113th Congress. I know we're going to have some big battles over debt limits and the like. But as we go through those fights, I want us to be bold. I want us to be big in our thinking. I want us to fulfill the great potential of this Nation. And I know we can do it. I know we can do it.

Mr. GARAMENDI. If I might interrupt you for just a moment. This had to be 6 or 7 years ago, I was Lieutenant Governor of California, and 3M, the manufacturing company, came in to talk about exactly that issue; and they had researched and developed a new conductor that was 30 percent more efficient in passing those electrons down the line. Think about what we could do in America to improve our energy capability by putting that in place; and if that were made in America, we could not only improve the energy efficiency. We would increase the capacity of our electrical system by 30 percent simply by rewiring those conductors across this Nation. That's American manufacturing, research and manufacturing. Put it in the infrastructure and build our strong economy. Great example.

Mr. GARAMENDI. You couldn't be more correct. You used the word ``holistic,'' meaning whole and in total, a total package. For years I've said that to have a growing economy and a just social environment, we needed to make, as Americans, critical investments. You hit three of those critical investments. You talked about research--absolutely critical investment in the future growth of the economy and to solve today and tomorrow's problems. That's research, most of which, interestingly, is funded either directly by the Federal Government through the National Institutes of Health or Defense Research Agency, DARPA, or one of the other Federal agencies, or indirectly through the research tax credit that we provide for businesses to engage in research. So research is one of the key investments that lead to economic growth. You mentioned the second one, very interesting, and that's education. A well educated workforce will be competitive across the world. That's a critical, perhaps the most critical, investment. Again, a role for the Federal Government, certainly a role for States and local governments, but a role for the American society that cannot be ignored--research, education. You drew it very, very correctly, and that is the manufacturing that comes from that. Manufacturing matters. How do you do that? You need to be in front of it; and when you talked about the research and the manufacturing technology, you were spot on. That's the third critical investment. The fourth one we also talked about here is infrastructure. So these are four of the critical investments that we need to make as a society. Some of that falls on individual companies, encouraged by a research tax credit or encouraged by Buy America. In different ways, we can encourage the manufacturing tax policy, which is critically important. We did that. Actually, it was a Democratic proposal. We did it 3 years ago. We've continued it. We've continued it in the recent fiscal cliff legislation where we provided 100 percent write-off for capital investment. That was from the Democrats. We care about business, and so we said, grow your business. We will provide you with a 100 percent write-off in the first year of capital equipment that you put in place. Not depreciation over 3, 4, 7, 15 years, but rather immediate, an enormous benefit to business. So we want the businesses to invest so that they can Make It in America. There are two more critical elements. I'll go through them very, very quickly. Provide for the national defense wisely. I think the public knows by now that we're spending $100 billion in Afghanistan this year--$100 billion. We need to bring it back home. We need to end that war. Thankfully, the President has set us off on a course where we will end American offensive action and move to supporting the Afghan Government in the spring of this year. Mr. President, we're thankful that you put that policy. Now let's bring the rest of it home, $100 billion. We need that money here. So we need national defense, but we need to be really wise about how we spend our money. Finally, the fifth thing is this: we need to change. We need to be willing to change. Thank you for bringing up the first three of those. But this is how we invest in the future, and these are policies that we need to put forward. They're the critical foundation for economic and social growth.