November 29, 2001
Ninth District Congressman Adam Smith, joined by a group of House New Democrat colleagues, today announced his support for a "lean, targeted, fiscally responsible" stimulus package.
The package includes meaningful relief for displaced workers and tax cuts designed to spur investment and stimulate the economy. Notably, the package maintains long-term fiscal discipline - a key cornerstone in a strong and healthy economy - by offsetting the worker relief and economic stimulus.
"There is a great economic argument taking place regarding whether or not our economy will continue to go south or if we're on our way to recovery,” said Smith "However, we all know for sure that hundreds of thousands of people are being laid off, and the unemployment rate in my state has climbed to 6.6 percent. That's why the centerpiece of our economic recovery package is meaningful workers' relief that includes extended unemployment, expanded eligibility for unemployment, training, and health care benefits. We cannot have a have an economic stimulus package without this kind of significant workers' relief.”
Also included in the proposal are tax cuts to stimulate the economy and spur investment, including providing for bonus depreciation on capital assets and increases in small business expensing allowances.
"Unlike a lot of the tax cut ideas being thrown out, these are tax cuts that will really work to encourage investment and create jobs,” Smith noted.
The New Democrat proposal is the only stimulus proposal that is fully offset, by cutting the top income tax rate to 38.6 percent instead of 35 percent over the next decade.
"Just yesterday, the White House announced that the days of budget surpluses are gone, and that we will see deficits for the rest of Bush's term,” Smith said. "While we absolutely must do something for the hundreds of thousands of displaced workers and something to give the economy a jump start, we must also maintain our long-term fiscal discipline.”
Currently, House and Senate Leadership is negotiating the procedure for a stimulus bill, and will begin discussing the substance of a bill as early as next week. Smith says that he is pleased negotiations have begun. "The proposal put forward by the New Democrats is where our leadership ought to be headed,” he said. "It's a measured, fiscally responsible approach that aims to cure what ails us - the unemployment problem. Instead of using the current situation to further longstanding political goals, whether it's big tax cuts or big spending increases, we should be moving in this direction.”