January 4, 1977
Page 48
BUDGET COMMITTEE HEARINGS TO REVIEW FISCAL 1977 BUDGET GOALS
Mr. MUSKIE. Mr. President, the Senate Budget Committee will hold Public Hearings January 11, 12, and 13 to reassess Congress' fiscal 1977 budget goals in light of the current economic outlook.
The hearings will provide the committee with a thorough evaluation of the current economic forecast in relation to the fiscal and economic objectives of the second budget resolution for fiscal 1977 which Congress adopted in September. They will form the basis for any determination by the committee as to whether the current forecast warrants a modification in the second budget resolution plan. Under the 1974 Congressional Budget Act, any such adjustment would require adoption by Congress of a third budget resolution for fiscal 1977.
The critical question the Budget Committee now confronts is whether the second resolution budget plan provides sufficient economic stimulus to maintain a strong economic recovery.
Adopted by Congress in September, this plan reaffirmed a 1977 budget policy designed to maintain the pace of recovery and reduce the Nation's jobless rate. The committee stated at that time that it would be prepared to reassess congressional budget policy in subsequent months. Our report accompanying the second resolution stated that we would be prepared to consider a new concurrent resolution early in 1977 if the economic data received by then did not indicate that recovery was proceeding satisfactorily.
Since that time, the Nation's key economic indicators have shown that our budget goals, which included an economic growth rate in calendar 1977 of 6 percent and a reduction in the jobless rate to 6.2 percent by the end of the year, are apparently out of reach. This is cause for considerable concern. It is important, therefore, that the committee have before it not only the best available economic information but also a broad review of various fiscal policy options best suited to deal with the current realities.
Such options would include those combinations of tax relief, direct Federal action in creating job opportunities and international policy initiatives that would be most effective in providing this stimulus.
On Tuesday, January 11, the committee will look at the critical economic forecasts as well as various policy options for providing additional economic stimulus. Our witnesses will include Drs. Walter W. Heller and Paul W. McCracken, both former Chairmen of the Council of Economic Advisers, and Dr. Alice M. Rivlin, Director of the Congressional Budget Office.
On Wednesday, January 12, the witnesses will address the implications of the international economic outlook to Federal budget policy. They will include Dr. Lawrence Krause, senior fellow of the Brookings Institution; Dr. Frank Schiff, vice president and chief economist of the Committee for Economic Development; and Lawrence A. Veit, deputy manager and international economist with Brown Bros., Hartman Si Co.
On Thursday, January 13, witnesses will include Mr. Reginald Jones, chair-man of the board of the General Electric Co.; Hon. Kenneth Gibson, mayor of Newark and president of the U.S. Conference of Mayors; and Albert T. Sommers of the conference board.
All hearings will be held in 357 Russell Senate Office Building beginning at 10 a.m.