May 2, 1977
Page13092
Mr. MUSKIE. Mr. President, the bill before us today, H.R. 4876, the economic stimulus supplemental appropriations bill for fiscal year 1977, is intended to insure that the economic recovery begun 2 years ago will not be interrupted. The bill provides fiscal 1977 budget authority of $19.9 billion to fund several important initiatives, including an increase in CETA jobs from 310,000 to 600,000 in fiscal year 1977 and to 725,000 in fiscal year 1978; new efforts to help unemployed youth.; $5.9 billion for both general and countercyclical revenue sharing for State and local governments; and $4 billion for local public works projects.
As chairman of the budget committee, I want to point out to my colleagues the flexibility of the congressional budget process that allows us to consider this stimulus supplemental. The budget act allows for the possibility of additional budget resolutions beyond the two required resolutions if changed circumstances warrant. While I am confident that adoption of a third budget resolution will be an exceptional rather than a commonplace occurrence, in this case the sluggishness of the economic recovery through the fall of 1976 dictated a reconsideration of the fiscal policy Congress adopted last September. A new budget resolution has allowed us to reset the revenue and spending limits within which Congress could review the President's proposals and competing legislative initiatives, decide on a course of action, and proceed without delay. I am pleased to see that we are debating today a bill to fund programs that the budget committee reported to you in the form of a fiscal policy only a short while ago.
However, I want to express my concern and disappointment that the economic stimulus program which is being proposed in this legislation is incomplete. An integral part of that program, the $50 rebate, which would have provided tax relief for almost all American families in 1977, lost the support of the administration and was eliminated by the Senate from its tax bill.
I believe this was a mistake. The basic reason which led the administration to propose the rebate in the first place, the need for stronger final demand during this year, remains valid. The Congress recognized this in adopting the third budget resolution for 1977 less than 2 months ago. The fundamental situation for the economy has not changed since that time, and the abrupt change in fiscal policy indicated by the withdrawal of the rebate was both unwise and inappropriate.
The elimination of the rebate will cost the Nation about 280,000 jobs at the end of this year, at the very time that about 7 million Americans will be without jobs. It will cost about $8 billion in lower incomes this year, and another $5 billion next year. There is a genuine danger that this restrictive action will produce another slowdown in the recovery.
We cannot change our fiscal policy with every change in the monthly economic data. We should not do this even if economic forecasting was exact, which it assuredly is not. We should not do it if we wish to maintain the credibility of a steady and independent congressional fiscal policy. For these reasons the Senate Budget Committee voted last week to retain the $7.3 billion of revenue reductions provided by the rebate. We did this both to indicate that we believe the congressional fiscal policy of the third budget resolution for 1977 remains the correct policy, and also because we believe it would be imprudent at this time for the congressional budget to eliminate the possibility that such legislation can be enacted.
Mr. President, based on the last Senate budget scorekeeping report, the total for the budget as a whole will remain under the third budget resolution ceiling by $2.5 billion in budget authority after taking account of this supplemental appropriations bill and all further requirements anticipated at this time. Likewise, the Appropriations Committee will remain within its allocation after taking these various requirements into account. Outlays will be under the budget ceiling compared to either the resolution now in force or the amendment resolution the Budget Committee has just reported to the Senate. The committee amendment adjusts the outlay ceiling downward due to a shortfall in spending anticipated earlier.
While a margin remains under the budget authority ceiling I want to caution my colleagues against using it up rapidly in amendments to this bill. The $2.5 billion remaining must see us through any unforeseen requirement during the 5 months left in fiscal year 1977. We need to make claims on these funds with care, for there will be no fourth budget resolution to bail us out of any tight spot we get ourselves into needlessly.
Mr. President, in closing I want to point out that an amendment has been prepared by the senior Senator from Pennsylvania to reduce by more than 50 percent the budget authority for public service jobs provided for in the President's stimulus proposals and accepted by Congress in the Third Budget Resolution. Adopting this amendment could seriously weaken our economic recovery effort. I urge my colleagues to vote against that amendment.