Floor Statement Hailing Passage of HIRE Act
Mr. REED. Madam President, we have today taken a very strong, positive step forward in terms of responding to the No. 1 crisis in our economy, and that is jobs for all of our people. Under Leader Reid's leadership, we were able to get a bill through, with a huge majority, and it signals, I hope, not only attention to jobs but also the willingness and the ability to find common ground to serve the people of our country.
We are now on the travel promotion bill, which is another piece of legislation designed to encourage job creation in the travel industry. All of this is good news. The legislation we propose this morning combines elements of tax breaks for small businesses so they can expense their items, increase their cashflow, and hire more people with credits for hiring people. There is a huge investment in our infrastructure, which will put people to work in the building industry and in industries that supply all these infrastructure projects, and there is also a significant commitment to Build America Bonds. These are good programs, and they are fully paid for.
We are now taking up the challenge to put people to work, to do it in a responsible way, and to do so in a way that we can attract bipartisan support. But there is much more to do. There is the recognition that we have to not only create jobs, but for the foreseeable future deal with those people who have been looking unsuccessfully for jobs and who are unemployed. In my home State of Rhode Island, the unemployment rate is 12.9 percent. That is the official rate. Unofficially, it is much higher, as many people have dropped out of the workforce.
If you look at sectors in terms of ethnicity or age, the numbers are even more startling. The bill we passed this morning is a good first step forward, but we have to do much more.
I think one of the first jobs we have to address is the extension of unemployment benefits. They will expire this Sunday. We have to recognize that, despite many efforts here, there are millions of Americans who are looking every day and not finding work. They need support.
All of the economists who have looked at these programs indicated that not only do they support individuals and families, they provide a tremendous multiplier of economic activity for every dollar we commit to the program. There is, as they say, a big bang for the buck. People who are without a job will take their benefits and invariably they will have to support themselves in terms of going to the grocery store -- doing the things you have to do just to get by day by day. They are not typically saving this money. That helps in the sense of increasing demand in the economy overall, increasing our economic growth.
If Congress fails to act swiftly, 1,200 Rhode Islanders will start losing their benefits each week. It is a small State and that is a big number. We have never before in our history, at least postwar history, ever terminated extended unemployment and emergency unemployment benefits until unemployment was at least 7.4 percent. At that point it appears, in most cases, that there is a self-sustaining economic growth that will itself begin to continue to lower the unemployment rate. We are far from 7.4 percent. As I said, in my State it is 12.9. The national average is hovering around 10.
We have to do this. Congress has acted eight time --1958, 1961, 1971, 1974, 1982, 1991, 2002, 2008 -- to establish temporary federal unemployment benefit programs beyond regular unemployment compensation and extended benefits. Not to do extend these benefits would essentially reject the consistent record of this Congress of helping Americans when the unemployment rate has reached such extraordinary proportions as it is today, whether the majority is Republican or Democrat. Last November, we did approve, without opposition, an expansion of up to 20 weeks, but now we need to pass a further extension.
As I said before, this is not just about helping families and individuals, it is also about helping the economy. For every $1 we invest in our unemployment benefits, we see $1.90 in economic activity overall throughout the economy.
One of the reasons I heard to oppose this morning's legislation: There is not enough demand to justify these tax incentives. They will not be used.
One of the things that does generate demand, consumer demand particularly, is the unemployment compensation program. It is not the way we want to do it. What we would like to see is a productive economy with jobs where the demand comes not only from people working but their being compensated and also being able, with discretionary income, to make consumption choices that today they cannot.
As I said before, we have to think about an agenda for jobs. We passed one piece of legislation today. We are discussing the travel legislation at this moment. We have to then move to the legislation with respect to unemployment compensation.
We also have to think about supporting the States with additional FMAP, that is, the funds for Medicaid, because, again, not only will that help our States, but without it you are going to see a contraction in our health care industry in terms of hospitals being able to hire or willing to hire. So we have many steps to go forward.
One aspect of this issue, which I would like to mention is that many of these programs we have talked about -- for example, the tax credits for hiring -- are nationwide and they miss the point that there are some areas that are much more affected by unemployment than other areas. We have States -- and their good fortune is something we should be proud of -- that have rates as low as 4.7 percent for unemployment. Yet they will qualify for these general, generic programs.
As we go forward and start thinking about additional steps, I think we also have to think about how we can target those programs to areas that have critical unemployment situations. Rhode Island, at 12.9 percent, is one, but there are many others. If you look within States, there are regions that have significant unemployment problems. Again, we have taken steps to extend our benefits, but as we go forward, as we consider additional legislation, let's also think seriously about how to make it more effective, more efficient, more targeted.
I again urge all my colleagues to continue the effort and spirit which resulted today in an overwhelming vote for a program that will help Americans and move our country and our economy forward.