Hillary Clinton on Budget & Economy
Secretary of State; previously Democratic Senator (NY)
CLINTON: Of course it has to change. That's why I have a plan. It's been judged to be the most effective. I do not believe that that is enough. We now have power under the Dodd-Frank legislation to break up banks. I've said I will use that power if they pose a systemic risk. But I want to go further, because it was investment banks, it was insurance companies, it was mortgage companies, all of which contributed. Let's not just be narrowly focused on one part of the problem. We have a lot of issues with corporate power that have to be addressed.
CLINTON: You can look at what I did in the Senate. I did introduce legislation to rein in compensation. I've laid out a very aggressive plan to rein in Wall Street--not just the big banks. That's a part of the problem and I am going right at them. I have a comprehensive, tough plan. But I went further than that. We have to go after what is called the shadow banking industry. Those hedge funds. Look at what happened in '08, AIG, a big insurance company, Lehman Brothers, an investment bank helped to bring our economy down. So, I want to look at the whole problem and that's why my proposal is much more comprehensive than anything else that's been put forth.
The credit card lobby pushed hard for the legislation, which did not prevail when Clinton voted for it in 2001, but did become law after another attempt by Congress in 2005. (Clinton did not vote in that round, telling reporters she missed the vote to be with Bill Clinton after his heart surgery.)
"The right kind of reform is necessary," Clinton said in a press release about the legislation in 2001. "We're on our way toward that goal, and I hope we can achieve final passage of a good bankruptcy reform bill this year"
During her initial presidential campaign, she said she would have voted against the 2005 bill that eventually passed.
In "Living History," Hillary writes, "proposed bankruptcy reform moving through Congress threatened to undermine the spousal and child support many women depend on." The New York Times also reported: "[Mrs. Clinton] wrote dozens of personal notes to lawmakers last year as the [bankruptcy] bills made their torturous way through the Congressional process. And she, along with Senator Edward Kennedy (D-MA), played what the bill's opponents say was a decisive role in helping to kill the legislation last year."
After seven years of stagnant wages, declining incomes and increasing inequality, our families are working harder and harder and still falling behind. President Bush had one final chance tonight to acknowledge what the American people have known for years: that the economy is not working for middle class families. Unfortunately, what he offered was more of the same--a frustrating commitment to the same failed policies that helped turn record surpluses into large deficits, and push a thriving 21st century economy to the brink of recession.
We need a President who understands the urgent economic challenges our families face and who will work as hard for middle-class families as they work for America. I intend to be that President for the American people.
A: Well, fiscal responsibility is a very high priority for me. We don’t have to go back very far in our history, in fact just to the 1990s, to see what happens when we do have a fiscally responsible budget that does use rules of discipline to make sure that we’re not cutting taxes or spending more than we can afford. I will institute those very same approaches. You can’t do it in a year. It’ll take time. But the economy will grow again when we start acting fiscally responsible. And then we can save money in the government by cutting out private contractors, closing loopholes, getting the health care system to be more efficient. We’ll do all of this at the same time, but the results will take awhile for us to actually see.
And we know that for those who worry about passing on this huge debt that has been blown up in the last six years--because remember, six years ago we had a balanced budget and a surplus--well, if you’re a grandparent worried about passing that debt on to your grandchildren, you’re invisible.
In 2003 and 2004 Clinton grew even more generous with the taxpayers’ dollars. She sponsored or co-sponsored 211 bills to increase spending and just three bills to reduce it, yielding a total net cost of $378 billion. This made Clinton the second most “expensive” senator during that time.
CLINTON: I don’t think that’s a good use of that space or of taxpayer dollars. There is work we need to do to upgrade the infrastructure. That’s why I support the Second Avenue subway. That’s why I support the East Side connector, a rail link to La Guardia and to JFK. I will go to the Senate to continue the work on Penn Station and others that Senator Moynihan has started.
LAZIO: I think it’s important to get the Jets and Giants back. This is not just a plan for a stadium; it’s also a plan for expansion of convention space. I don’t think this should be funded with public money entirely. But I believe that this is an important initiative to build jobs for New York.
A: We have a surplus after 7 years of good economic leadership in our country. We should pay down the national debt, secure Social Security, add a prescription drug benefit to Medicare, and provide affordable tax cuts. I have been very careful to cost out my plan because I believe in a balanced budget. That’s why I reject the large tax cut that independent experts have said is more than a trillion dollars that my opponent has proposed.
Obama did vote against--and Clinton voted for--an amendment that would have placed a 30% cap on the interest rate that could be charged on any extension of credit. The amendment failed by a vote of 74 to 24 in 2005. When the amendment came up for a vote, Obama was standing next to Sen. Paul Sarbanes, D-MD, the senior Democrat on the banking committee and the leader of those opposing the landmark bill, which would make it harder for Americans to get rid of debt. As for whether the 30% cap was too high, that’s certainly a matter of opinion.
Obama mischaracterized Clinton’s comments on her vote for an earlier, 2001 bankruptcy bill. Obama said, “Sen. Clinton said she voted for [the 2001 bill] but hoped that it wouldn’t pass. Now, I don’t understand that approach to legislation.“
That’s not exactly what Clinton said. When asked if she regretted voting for the 2001 bill, Clinton answered, ”Sure I do. It never became law, as you know. It got tied up. It was a bill that had some things I agreed with and other things I didn’t agree with. I was happy it never became law. I opposed the 2005 bill as well.
CLINTON: I regretted voting for the bankruptcy bill and I was happy that it didn’t get into law. By 2005, there was another run at a bankruptcy reform, motivated by the credit card companies and the other big lenders. I opposed that bill. There was a particular amendment that is very telling. It was an amendment to prohibit credit card companies from charging more than 30% interest. It was one of the biggest lobbyist victories on that very bad bill that the bankruptcy bill represented.
In 2001, despite President Clinton's veto, the bankruptcy bill was reintroduced in the next session of Congress. This time, even Senator Hillary Clinton bowed to big business. She had been in office two months when she had her chance to vote on what she had called "that awful bill."
She clearly understood that families in trouble would be hit hardest by the proposed changes [but] families in financial trouble do not make campaign contributions or have lobbyists. Senator Clinton had taken $140,000 in campaign contributions from the banking industry, and she proved willing to overcome her "strong reservations about whether this bill is both balanced and responsible" and voted in favor of "that awful bill."
Proponent's argument to vote Yes:Rep. DAVID OBEY (D, WI-7): Congress has tried to do a number of things that would alleviate the squeeze on the middle class. Meanwhile, this economy is sagging. Jobs, income, sales, and industrial production have all gone down. We have lost 600,000 jobs. We are trying to provide a major increase in investments to modernize our infrastructure and to provide well-paying construction jobs at the same time.
Opponent's argument to vote No:Rep. JERRY LEWIS (R, CA-41): Just 2 days ago we were debating an $800 billion continuing resolution. Now in addition to being asked to pay for a bailout for Wall Street, taxpayers are being asked to swallow an additional $60 billion on a laundry list of items I saw for the first time just a few hours ago. The Democratic majority is describing this legislation as a "stimulus package" to help our national economy. But let's not fool ourselves. This is a political document pure and simple. If these priorities are so important, why hasn't this bill gone through the normal legislative process? We should have debated each of the items included in this package.
It doesn't take an economist to tell you that the economy needs our help. But what does this Congress do? It proposes to spend billions more without any offsets in spending. The failure to adhere to PAYGO means that this new spending will be financed through additional borrowing, which will prove a further drag on our struggling economy.
Proponents recommend voting YES because:
My amendment says we are going to take about $18 billion as a strong signal from the Congress that we want to support effective programs and we want the taxpayer dollars spent in a responsible way. My amendment doesn't take all of the $88 billion for the programs found by PART, realizing there may be points in time when another program is not meeting its goals and needs more money. So that flexibility is allowed in this particular amendment. It doesn't target any specific program. Almost worse than being rated ineffective, we have programs out there that have made absolutely no effort at all to measure their results. I believe these are the worst offenders. In the following years, I hope Congress will look at those programs to create accountability.
Opponents recommend voting NO because:
The effect of this amendment will simply be to cut domestic discretionary spending $18 billion. Understand the programs that have been identified in the PART program are results not proven. Here are programs affected: Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, child abuse prevention, and treatment. If there is a problem in those programs, they ought to be fixed. We ought not to be cutting Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, and the rest. I urge a "no" vote.
Sen. DODD: Today we are facing a crisis in the mortgage markets on a scale that has not been seen since the Great Depression: over 2 million homeowners face foreclosure at a loss of over $160 billion in hard-earned home equity; over one out of every 5 subprime loans is currently delinquent. These high default rates have frozen the subprime and jumbo mortgage markets and infected the capital markets to the point where central banks around the world have had to inject liquidity into the system to avoid the crisis from spreading to other segments of the market.
One of the fundamental causes of this serious crisis is abusive and predatory subprime mortgage lending. The Homeownership Preservation and Protection Act of 2007 is designed to protect American homeowners from these practices, and prevent this disaster from happening again. The legislation will:
In the coming months, the housing crisis is going to get worse. We will need to continue to press lenders and servicers to provide real relief for homeowners threatened with foreclosure.
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