Pelosi Remarks at Press Availability Following Economic Forum

WASHINGTON, May 4 /PRNewswire-USNewswire/ -- Speaker Nancy Pelosi, House Democratic leaders, committee chairs and economic experts held a press availability today following an economic forum in the Speaker's Office. The three-hour forum, which convened national experts on economic and financial issues, addressed the state of America's economy, focusing specifically on the creation of jobs. Below is a transcript of the press availability:

Dr. Allen Sinai on Economic Recovery:

"What I told everybody was that we are, and this is very good news, in our view, in an entrenched sustainable recovery expansion. We are out of the woods in that sense. And Washington policies had a lot to do with that. It is unthinkable to think about if we hadn't had those policies in terms of how bad it might have been."

Dr. Heather Boushey on Economic Recovery:

"The challenge now is that even though we're starting to see some economic growth, starting to see some good signs going on, we have to make sure not to turn that spigot off too quickly. We need to make sure we're continuing to provide that support to get folks back to work — especially in the areas of making sure that state and local governments aren't adding to our overall economic woes by continuing to pull back and to lay folks off, making sure that teachers are still in the schools."

Speaker Pelosi. Good afternoon. Thank you all for being here. I am sorry we are a little bit delayed. We were getting the benefit of the thinking of some leaders from the economic, academic, and business community to tell us how the economy looks, what the impact was on the recovery package and the policies of the past year, which was very positive, how we go forward. And you will hear from the economists directly on that. Dr. Allen Sinai got us off on a track of talking about the job deficit and the budget deficit and how we establish policy to address both. Mr. Hambrecht will talk to us about the role small business plays in that. Others of our presenters will have talked about the need to stabilize state and local governments and how important that is. We were blessed by the participation of Dr. Linda Bilmes by phone, Dr. Alan Blinder, who is with us, and you will hear from, Dr. Heather Boushey who is with us, Bob Greenstein had to leave just now, William Hambrecht, Robert Reischauer who had to leave, Dr. William Rodgers and Dr. Allen Sinai — a cross section of thinking and ideas about how we go from here.

I am very proud of what the Obama Administration has done to date to address two crises: the financial crisis that was at his doorstep when he became President and the great recession, which he also inherited. Our members of the leadership, Mr. Hoyer had to go get an award, but stayed with us for three hours. Mr. Clyburn, Mr. Van Hollen, Congresswoman DeLauro, Chair of our steering committee, Chairman Miller, chair of our policy committee and author of a very popular jobs bill, Congressman Pallone, head of our message group.

But in any event we had a lively, three-hour session to talk about it. But before I yield to our first presenter, Dr. Sinai, in appreciating what we heard from them today, I want to take this opportunity to say, again, how proud I am of the initiatives taken by the Obama Administration. They were supported by us 14 months ago — a recovery package which has changed the direction of GDP — we are now in growth; changed where the stock market is up by 4,000 points; slowed drastically what was happening in terms of job loss in our country from 779,000 jobs lost the last month of the Bush Administration to now a period of job growth; and nine straight months — April was the ninth straight month of investments in manufacturing, which is something we haven't seen in years. So it is great pride in what we have done that we invited these leaders to come and speak to us about how they saw things and what their recommendations were, how we go, where we go from here.

Main subject of, the two subjects — one a four-letter word that we say all the time around here: jobs, jobs, jobs, jobs. And how we take initiatives to create jobs while at the same time reduce the deficit. Job deficit, budget deficit — that was Dr. Sinai's presentation.

Dr. Allen Sinai. Well, thank you. What I told everybody was that we are, and this is very good news, in our view, in an entrenched sustainable recovery expansion. We are out of the woods in that sense. And Washington policies had a lot to do with that. It is unthinkable to think about if we hadn't had those policies in terms of how bad it might have been.

Second, we have two deficits in the aftermath of what went on. Not surprising, in a way, a huge jobs deficit, tremendous amount of unemployment, a lot of work to do to get unemployment, full employment, 5 percent unemployment rate at some date down the road.

And second, we have a legacy of huge deficits, in part coming from the emergency measures that we had to take, we had to take in order to save the economy. But as things improve, the focus can change, always making sure that we head toward full employment, thinking about policies, devising policies that can — might reduce the deficit and moves us toward full employment. It may sound impossible. It may sound undoable here in Washington. But I happen to believe it is possible and doable, and I fully expect everyone to make that happen and the political process to lead us to full employment with lower deficits going down the road in the future.

Dr. Alan Blinder. Thank you. I guess I'd just like to say that it is very understandable why there is so much pessimism and disgruntlement with government in this country now. We have a 9.7 percent unemployment. That is a terribly high number.

But to underscore and to come back to a point Allen Sinai made, if you thought back to the attitudes that people had in March of last year, that is not so very long ago, both the financial system and much more importantly the economy look vastly better than seemed likely only 13, 14 months ago. Now not all the credit for that belongs in Washington, but some of it does — some of it down the block at the Federal Reserve, some of it right here in the halls of Congress. I take one example, the TARP, which was probably, I don't know, I don't keep score, the Members keep score—maybe the most unpopular vote anyone ever had to take, and I understand that. The current estimates of the cost to the taxpayer, not $700 billion, but more like $100 billion and falling. As the news gets better and better, the prospective cost of the TARP are getting smaller and smaller. This is actually unknown. I don't think anybody, hardly anybody, outside the aficionados know about this. It was actually a tremendous success, but it remains tremendously unpopular.

The problems for today are different now, as Allen Sinai just said, of course the jobs are coming back much too slowly. It looks like it is getting better, but much too slowly for anybody's satisfaction. And we have this looming budget deficit. The challenge for the Congress now, I think, is to realize that a dollar is not a dollar is not a dollar. That is to say there are things that can be done on the spending side and on the tax side that are better and worse for job creation. The generic idea is when you tax that is bad for jobs, and when you spend that is good for jobs. There are some exceptions to that. But not every dollar of spending is the same. Not every dollar of taxing is the same. I think the challenge for the Congress now is to devise budget packages that are efficient in terms of job creation, relative to any deficit increases that they cost. It is not easy, but that is what is in front of the Congress now.

Speaker Pelosi. Thank you very much.

Mr. William Hambrecht. Thank you. I'm Bill Hambrecht, the WR Hambrecht and Company in San Francisco. My message today was to point out to the Members that during the past three decades, almost all of the real true job creation that happened in our economy was generated by small business, by small growing companies. The larger companies tend to grow by acquisition; acquisitions by nature shrink jobs, shrink organizations. Small companies, if they can get the resources, are capable of growing organically, capable of adding employees, and have been a job engine for the past several decades.

I think that TARP was extraordinarily successful in saving that system, and in particular it saved the top 600 banks. But it did leave the other 7,000 banks pretty much to the mercy of the FDIC. And so they are not in a position to really, to lend aggressively. So I think we have a situation out there where the credit is scarce, or even if it is there, it is very hesitant to take any risks because of the tremendous situation they just went through. So to me, to get the small companies moving again, to reinvigorate technology companies, growth companies, I think we have to get easier and better access to equity in the marketplace. We have to deleverage the system. We have to get equity into the system and allow companies to sell shares to the public, to put their finances on a permanent long-term basis so they can truly create jobs. Thank you.

Dr. William Rodgers. Good afternoon. This is Bill Rodgers. I am a professor in public policy at Rutgers University in New Brunswick, New Jersey, and also a board chair for the Somerset County United Way. I came with two messages today. One, the first centered around — right now the Federal Reserve is saying they are keeping the interest rates very low, their stance on when they are going to change is still down the road, but it will ultimately, as job creation does reemerge, does grow. They are going to be put in a position where they are going to start to feel, potentially that there are inflationary pressures out there, and so the message I delivered here was that there are, when the Fed does raise rates, it has deferential effects across communities, across different individuals. And so we need to make sure that the signs of inflation typically when they come back are real. Because right today we have about 25, 26 million Americans who make up an untapped pool of potential, though that the 15 million Americans are unemployed and 9 million Americans are working part-time but want to work full, but want to work, and another 2-3 million that stopped searching but they want a job.

And so we need to make sure that the, because as my colleague said, along with what Congress has done, the Federal Reserve has played a major role, and we don't want to begin to choke off the opportunity that could emerge in those communities as the recovery really picks up steam.

And pivoting into my second point, was around non-profits. That non-profits have and continue to play an amazing and important role in providing a bridge for people when they volunteer or they work part time to the private sector, that a lot of networking for new jobs occurs when you are volunteering in the non-profit sector. Why is this important? Well, we have seen over this period of the last few years an increase in incredible demand for services within our own communities. But we have also seen a decline in the capacity of non-profits to be able to meet those needs.

So one of the messages I talked about was can we continue with the good work that's in Congressman Miller's bill to shine a light — a greater light on the role that non-profits can do — in not just the short term, but also in the long term. Thank you.

Speaker Pelosi. Thank you very much, Dr. Rodgers. Heather Boushey?

Dr. Heather Boushey. Thank you. My name is Heather Boushey. I'm the senior economist at the Center for American Progress, here in Washington, D.C. And my take homes from this meeting today are a few things. And first of all we're focused — first and foremost on the jobs deficit.

You know, we have millions of Americans that continue to be out of work today even though we've started to see the economy start to grow. And certainly we know the policies that this House of Congress and the Administration and the Federal Reserve have taken to spur economic growth have been effective. We know that the Recovery Act has saved or created over 2 million jobs at this point. And that's an important thing to remember moving forward.

The challenge now is that even though we're starting to see some economic growth, starting to see some good signs going on, we have to make sure not to turn that spigot off too quickly. We need to make sure we're continuing to provide that support to get folks back to work — especially in the areas of making sure that state and local governments aren't adding to our overall economic woes by continuing to pull back and to lay folks off, making sure that teachers are still in the schools. These are important steps forwards and a lot of the things that we're focused on here today.

Speaker Pelosi. Thank you very much, Dr. Boushey. All our leadership thanks our distinguished guests for giving us the benefit of their thinking and their ongoing wisdom as we create jobs and reduce the deficit. Mr. Clyburn, did you want to add to that?

Majority Whip James Clyburn. My take-away from this meeting today is that it is very, very important for us to do what is necessary in the interim to continue to stabilize governments. We are seeing significant headlines as I left home this morning — I saw a big headline that we're about to lay off 4,000 teachers in South Carolina. And that is an ominous thing to think about as we try to get our young people educated and we're going forward.

But I'm also particularly interested in the discussion that took place today as how we can move forward in getting job creation out in the communities where the people, who with limited experiences are — experiences with real significant pressures on their families. And so I believe that what I've heard here today will allow us to put together legislation going forward that will allow us to get these monies in these communities so that we can begin to stabilize families, as well as stabilize state governments. Thank you.

Speaker Pelosi. Thank you very much, Majority Whip Clyburn. Our other Members will be a resource in the Q and A here, but much was said about stabilizing the public sector in terms of state and local governments. Mr. Miller's bill does a great deal to do that and to accomplish what Dr. Rodgers talked about the non-profit sector. There is an emergency looming, which is the firemen, at least a quarter of a million teachers, many first responders as well, in our communities—we consider it an emergency. That's one of the things we discussed today as we go forward. But to budget is to choose, establish the priorities and as Dr. Sinai and others have said, we have to make these decisions. Dr. Blinder talked about one dollar being different from another dollar — whether it's on the revenue side or on the investment side. Those are the judgments we have to make — obviously much better informed because of the presentations we heard today to be current, to be current, on where they saw the marketplace and how the marketplace would react to our budget decisions here.

With that, we'd be pleased to take any of your questions.

Q: Inaudible. [Question about passing jobs legislation by Memorial Day.]

Speaker Pelosi. Well that would be our hope. We have a number of jobs bills that we have sent over to the Senate as you well know. One that we passed in December — $150 billion — some of it paid for, some of it not, as it relates to the safety net. We must pass the safety net — unemployment insurance, COBRA, TANF, those elements of it because the time is running out. The time is also running out for people who need their jobs.

But let me say this: the recklessness on Wall Street caused tremendous joblessness on Main Street. The legislation that the Senate is considering is very important as to how we go forward. That is — by the President's estimate, 8 million jobs were lost to our economy and from the lives of individual people and families because of that recklessness. So, I believe what they are doing is very much related to jobs and I would invite any of our guests or our colleagues to respond to that point.

Chairman George Miller. I just want to say to that point — we look at the crisis looming with somewhere between 250,000 to 300,000 teachers being laid off across the country. The revenues that were stripped from those school districts came from a result of the financial scandals on Wall Street. Property values plummeted, tax revenues — houses were re-evaluated, revenues were lost to school districts, sales taxes available to cities were stripped because people weren't buying cars because they couldn't afford to buy cars, you couldn't get credit to do it. So, that kind of economic activity that cities and school districts rely on was stripped away from them now for the last two years and it's critical that we respond to this emergency.

So I think we're proven over and over again that we can do more than one thing at a time.

Speaker Pelosi. Remember that, one of the reasons that individuals have suffered loss of job, risk of home, pension, savings, the education of their children, that uncertainty in their lives, is that those — there were some on Wall Street who thought it was okay to privatize the game for themselves and nationalize the risk and put it right at the doorstep — not only of the taxpayer, but the homeowner, and the list goes on.

So, the issue of jobs and Wall Street reform are directly connected.

Q: Madam Speaker, last week…the environment…You said last week that the environment (inaudible) leadership (inaudible) Democrats (inaudible) oil spill about the drilling. Lindsay Graham has said that (inaudible) of this bill in the Senate (inaudible) offshore drilling (inaudible). Are you worried that (inaudible).

Speaker Pelosi. I'm happy to answer that but I just want to have — because some of our folks who are here on jobs and the economy and not that this — this is a big economic issue for us. But if there are any other questions for them, and then I'll come back to you on that.

Q: In that vein, is there any concern that if the oil spill continues to worsen it might undermine what is so far a slow, fragile recovery?

Speaker Pelosi. Well let me just say this: When the President presented his budget last year, it was a statement of our national values that we all respected. And the House and the Senate voted on it in one and the same day. It had a blueprint for long-term economic stabilization centered around job creation, deficit reduction, tax cuts for the middle class — that is the budget that we have. The job creation and the economic stability were centered on three pillars. One was investments in education and innovation. One was in energy and in climate change issues. And the third was the first among equals — investments in health care. In the reconciliation bill that we passed, we addressed the health care, and with Mr. Miller's leadership, the education piece. Those two pieces of that.

The third piece is the jobs piece related to energy. As you know, we passed the bill last June and we're anxiously awaiting the Senate to pass their bill. Certainly, the risk of that is presented by — offshore drilling is something that has to be taken into consideration. But we must pass this bill and we will find our area of agreement — they in the Senate and then we between the House and the Senate to pass it. I don't think that this is something that will stop because the President has always said, the bill will be and the initiative will be about all elements of domestic production.

Mr. Miller has worked on this issue a long time. Perhaps he wants to say…

Chairman George Miller. I just want to say that I think that clearly…

Speaker Pelosi. Former Chairman of the Natural Resources Committee.

Chairman George Miller. I did the Congressional investigation of the Exxon Valdez. And at that time, we criticized the cleanup methods because we were simply putting diapers and Huggies and towels on the oil spill. I think the immediate lesson from this is that going forward with the consideration of offshore oil requires the complete re-evaluation of what you do when the oil is in the water — because the minute that the oil is in the water, you're losing. We lost in the San Francisco Bay a year and a half ago. You lose whenever the oil hits the water.

So it's a question of prevention, and now we're starting to see that perhaps after 10 years of self-regulation, the oil companies chose not to engage and invest in the same kind of prevention that oil companies — these same companies were investing in the North Sea and elsewhere in the world. And so, I think before you get to the question of whether this disrupts the whole energy legislation, I think it's really a question that I think every coastal governor, every Member of the Senate and the House, and most of the people in this nation want to pause to check to see whether or not we have a prevention system and a clean-up system that's worthy of this century. Because we're still using one that we used from the beginning of time — just to absorb oil. And it's not sufficient, and it clearly isn't sufficient in the open ocean. It's one thing in San Francisco Bay, which is relatively calm but there are the tides beating us in the open ocean.

So, the two things can go forward, the energy bill can go forward and a critical re-analysis of our ability to prevent and to clean-up has to go forward before you can go deeper into this discussion.

Dr. Allen Sinai. The question was an economic question and the answer is that it is obviously serious, it's going to do some damage to some of the areas in terms of their state economic performance. It is not going to derail the recovery and expansion. It is not a big macroeconomic event. But it's, of course, a cause of concern in society.

Majority Whip James Clyburn. Since my senior Senator's name was mentioned in this. South Carolina is one of those states where tourism is very, very important. In fact, is it our number one industry. And I'm very, very concerned about this. We are, in our new energy bill, the bill that we sent over, we have all kinds of possibilities for alternative energy as well as homegrown energy, but as Congressman Miller said: it's all about prevention. The problem we have here — I think that the more that we look into the background of what's happening off the Gulf Coast — I think that what we're going to see is a tremendous failure of prevention, of oversight, of allowing, as Congressman Miller says, "self-regulation" to take place. I believe that we can, if we will, prevent these kinds of things from happening, or at least have some fail-safe methods in place, should something like this occur. And that's what happened here — we had something to occur, and I think the more we look at this we see that there were warnings about these possibilities that went ignored.

Q:…take time that Menendez and Nelson were saying…to move forward.

Majority Whip James Clyburn. We'll see as we go forward. There's discussion for that. I do believe that Senator Graham, with whom I've had significant discussions about this knows the importance of this energy bill to our country, and most especially to the state that both of us love so dearly.

Speaker Pelosi. Thank you all.

* * *

PARTICIPANT BIOS:

Linda Bilmes – Professor Bilmes is a professor at the John F. Kennedy School of Government at Harvard University. She has held senior positions in government, including Assistant Secretary and Chief Financial Officer of the U.S. Department of Commerce, Deputy Assistant Secretary of Commerce for Administration, and has been a U.S. Representative to several high-ranking commissions.

Alan S. Blinder – Professor Binder is a professor of Economics and Public Affairs at Princeton University and Co-Director of Princeton's Center for Economic Policy Studies, which he founded in 1990. Dr. Blinder served as Vice Chairman of the Board of Governors of the Federal Reserve System in the 1990s and a member of President Clinton's original Council of Economic Advisers.

Heather Boushey – Dr. Boushey is a Senior Economist at the Center for American Progress. Prior to joining the Center she was a senior economist with the Joint Economic Committee of the U.S. Congress. She was formerly a senior economist with the Center for Economic and Policy Research.

Robert Greenstein – Mr. Greenstein is the founder and Executive Director of the Center on Budget and Policy Priorities. Prior to founding the Center, he was Administrator of the Food and Nutrition Service at the U.S. Department of Agriculture under President Carter. He was appointed by President Clinton in 1994 to serve on the Bipartisan Commission on Entitlement and Tax Reform and headed the federal budget policy component of the transition team for President Obama.

William R. Hambrecht – Mr. Hambrecht is the Chairman and CEO of WR Hambrecht + Co. He has been in the securities business since 1958. A co-founder of Hambrecht & Quist in 1968, he resigned in December 1997 to form WR Hambrecht + Co. Mr. Hambrecht has served as a director for numerous private and public companies. He currently serves as a Director for Motorola, he is on the Board of Trustees for The American University of Beirut and he serves on the Advisory Council to The J. David Gladstone Institute.

Robert D. Reischauer – Mr. Reischauer is the current President of the Urban Institute in Washington, D.C. From 1989 to 1995, he was the director of the Congressional Budget Office (CBO) and is a nationally known expert on the federal budget, Medicare, and Social Security. He had been a senior fellow of economic studies at the Brookings Institution since 1995.

William M. Rodgers III – Professor Rodgers is a professor and chief economist at the Heldrich Center for Workforce Development at Rutgers University. He is also a senior research affiliate of the National Poverty Center at the University of Michigan. Prior coming to Rutgers, he served as chief economist at the U.S. Department of Labor from 2000-2001.

Allen Sinai – Dr. Sinai is Chief Global Economist and President of Decision Economics, Inc. (PDE), a global economic and financial advisory firm.

SOURCE Office of the Speaker of the House

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