July 14, 1971
Page 25106
Mr. MUSKIE. Mr. President, the Public Works Acceleration Act Amendments of 1971 is a good means of attacking the present stagnant economy resulting in high unemployment and meeting pressing social and environmental needs.
Today our economy is characterized by high unemployment and inflation. The American public has been promised that the economy will improve as soon as unemployment reaches a high enough rate. The economic policy followed today is based on the belief that inflation is caused, in part, by the maximum use of resources and that inflation could be abated by increased unemployment and economic slack. I believe that this economic policy is not only socially unjust but also economically faulty.
I believe that full employment and full production are the best way of combating inflation.
Economic history supports this belief. In the 1952-55 period the country had both high employment and substantial economic growth and yet prices remained relatively stable, averaging an annual increase of only .3 percent for consumer prices. Later, in the 1956-58 recessionary period, there was slow economic growth, raising unemployment from 3.8 to 6.8 percent, and substantial price inflation, raising 10 times the average rate of the 1952-55 period.
Soon after he took office in 1969, President Nixon announced that the United States would pursue a policy designed to halt inflation by cutting back Government spending and raising interest rates. I question the wisdom of such a course of action when so many prices are administered rather than allowed to fluctuate in the free market. Instead, I believe that President Nixon should have followed a policy encouraging the maximum use of our resources.
How is this to be done? I believe that there are several ways to stimulate the American economy.
We should immediately put into effect already enacted personal income tax cuts. Also, we should implement a meaningful income policy to control inflation. Recently, Congress responded to the present intolerable levels of unemployment by passing the Emergency Employment Act of 1971.
Despite these measures more can be done. The accelerated public works program is a valid response to inadequate public works and high unemployment in certain areas and industries. Congress should carry through its initiative and commitment by overriding President Nixon's veto.
The Public Works Acceleration Act of 1971 is designed to provide money for a backlog of public works projects. Estimates indicate that this act will create about 170,000 onsite construction jobs in an industry hard hit by unemployment. The total effect of this bill would be to create as many as 420,000 jobs. These jobs are not contrived but are jobs on public projects vital to the welfare of our Nation.
The President believes that this bill will not work because of the long lead times required to get the projects underway. What the President does not consider, though, is the backlog of projects already planned and ready, awaiting only funds. There are 3,000 applications for Federal approval of waste treatment plants, 800 applications for water and sewage plants, and 1,900 applications for hospitals. Many of these projects can be started right away.
The President also says that this legislation will not solve the problems of some of the segments of the labor market. I agree that the direct effect of the bill may not encompass the entire economy. Yet, this legislation will help the economy. A Vietnam veteran may not be employed on a construction site but he may be employed in a job created in a secondary industry.
In his veto message President Nixon singles out the construction workers as a major contributary cause of inflation. That argument uses the construction worker as a scapegoat for our general economic problems.
President Nixon vetoed this bill because he believes that this bill might be environmentally damaging. This blil, however, is designed, in part, to meet the environmental needs of our communities.
For these reasons, I urge that the veto of the Public Works Acceleration Amendments of 1971 be overridden. I believe that this bill is a good sound measure designed to aid the economy, to provide jobs for unemployed citizens.