SHAHEEN FOCUSES ON ECONOMY, BIPARTISANSHIP AT NEW ENGLAND COUNCIL LUNCHEON

(Washington, D.C.) – U.S. Senator Jeanne Shaheen (D-NH) addressed members of the New England Council at a Congressional Luncheon today to provide an update on her work in the U.S. Senate on behalf of the Granite State. Shaheen discussed important economic issues facing New Hampshire, her bipartisan efforts to assist families and businesses in the state and the challenges facing Congress in the year ahead.

Below are Shaheen’s remarks, as prepared for delivery:

I always appreciate a chance to speak to the members of the New England Council. You have a keen understanding here of the unique strengths of New Hampshire. And you know how important it is that the New England states work together.

The economy has been my chief concern since I was elected to the Senate. It’s what people ask me about when I’m home in New Hampshire every week. It’s what motivates me to get back on a plane to Washington. It’s what I have spent nearly all of my time working on over the last year.

And while our economy continues to struggle to recover from the deepest recession in generations, the last year in the Senate has given me hope. I know that none of the problems we face are insurmountable. As a nation, we have overcome tougher challenges. To solve the problems before us will require ingenuity, hard work, and compromise.  In recent months I have seen more willingness in the Senate to work together across party lines. Let me give you a few examples.

The future of New Hampshire’s economy – and the economy of our entire nation – is dependent on innovation. We will never beat nations like China at high-volume, low-cost manufacturing. That era is over. But we can continue to lead the world in creating groundbreaking new technology and in high-quality, high-tech manufacturing.

Late last year Congress finally acted to grant a long-term extension to the Small Business Innovation Research Program, or SBIR. The program had been struggling under short-term extensions since 2008, which it hard for both agencies and companies to use it effectively. SBIR allows small companies to compete for a share of federal research and development dollars.  I visited one such company at the beginning of this year, SustainX. They said the SBIR grants they received in the first few years allowed them to turn a laboratory concept into an innovative energy storage product. They employ 30 people here in New Hampshire and really exemplify the kind of high-tech manufacturing that the United States needs to compete in the global economy.

I worked to get a long-term extension of SBIR written into last year’s defense bill, and I am proud to say we got it done and it passed with strong bipartisan support. 

In August, Senator Ayotte and I held a joint bipartisan field hearing here in New Hampshire of the Senate Small Business Committee. We wanted a chance to hear from business owners about the challenges they face in exporting. While 95 percent of the world’s customers are outside the United States, only one percent of small companies export, so there is tremendous room for growth. Based on what we learned at that hearing, Senator Ayotte and I have introduced a bipartisan bill that will streamline export services and make them easier to access for small business owners.

One of the chief concerns we heard at that hearing is how difficult it can be to obtain the financing needed for exports. I’ve held a few events to help small business owners learn about the services offered by the Export-Import bank. Many companies have found the Bank to be a welcome partner in their efforts to expand to overseas markets. But earlier this year, the bank itself, which is totally self-funded, was in danger of closing unless Congress renewed its charter. Again, I am glad to say that I was part of a bipartisan effort to marshal the support the Ex-Im bank needed. We got it done, and the bank can continue its great work. 

Another place that has seen bipartisan cooperation in the Senate is highway funding. A strong, long-term transportation bill would mean new jobs and dependable roads that businesses can count on to move goods and reach customers. In March, we passed a strong bipartisan bill that funds the program for two years. It was written by Senators Barbara Boxer and James Inhofe, who are about as far apart on the political spectrum as it is possible to get. The bill was supported both by the Chamber of Commerce and the AFL-CIO. And ultimately it passed with 74 votes.

And this, unfortunately, is where I grow frustrated. The House of Representatives has chosen to ignore this bill and the bipartisan approach it embodies. I think this is a mistake and it is one we have seen far too often from the House.

Earlier this year, the Federal Aviation Administration was forced into a partial shutdown that threatened local airport projects and threw people out of work, all because the House would not move on a bill for weeks. Standoffs with the House over annual appropriations bills and the debt limit threatened government-wide shutdowns not once, but twice in the past year-and-a-half.

Now transportation programs are facing a similar showdown. Funding expires in only eight days, and yet the House refuses to pass a long-term bill or to negotiate with the Senate in good faith.

Without a long-term bill, the state will find it very difficult to complete critical improvements to Interstate 93.  Other important projects across the state will be delayed, such as the park-and-ride in Manchester and reconstruction of Broad Street in Nashua. If no action is taken to shore up the Highway trust fund, the state DOT will be pushed into drastic cuts and projects across the state will be canceled.

This is too important for partisan games. And I know we can get it done, because the Senate has already found a way to do it.

We need more compromise now, not less. Right now, the transportation bill is the most urgent issue before us, but it is hardly alone and it is hardly the largest deadline facing Congress. Before the end of the year, we have several issues that must be addressed, and we need to find ways to come together on them now.

The first is student loans. By the end of this month, interest rates on federally subsidized Stafford loans will double. This will add $30 million to the debt burden carried by students in New Hampshire alone. There is bipartisan agreement that we need to find a way to prevent this increase, and yet political posturing has made a deal  impossible so far.

The second is annual appropriations bills. Unless we pass our annual spending bills before September 30^th, we will be forced to rely on short-term extensions that create great uncertainty.

Third, we have a host of tax provisions that will automatically expire this year unless Congress takes action. These include a range of important business tax incentives, such as those that reward investment in research and development and encourage the hiring of veterans. At the end of the year, the marginal rates on personal incomes taxes will increase for all Americans to their Clinton-era levels unless Congress takes action. These are the so-called Bush tax cuts.

Last, we have the automatic cuts to spending that were in put in place by last summer’s debt limit agreement, commonly referred to as the sequester. Unless Congress enacts some form of comprehensive debt reduction package, spending will be cut automatically for the next ten years, starting next year. Six-hundred billion will come from domestic spending, which is everything from roads to cancer research to community health clinics. Another 600 billion will come from defense.

The sequester is the wrong way to reduce our deficit. It does not deal with the structural drivers of our deficit – which are the growth in mandatory spending and the decline in revenues. And it does not discriminate between efficient or critical programs and those programs that are outdated and no longer useful.

I have proposed cuts to many of these wasteful programs, such as cuts to the government’s inflated vehicle budget. I helped write language into the defense bill that cuts development funding for a missile system the Pentagon has no intention of buying once it’s developed. Just last week I worked with Republican Pat Toomey to propose caps on insurance subsidies for large farms that are getting unlimited taxpayer support they don’t need.

The sequester does not target this kind of waste. It just slashes everything, across the board.

Yet undoing the sequester without enacting significant deficit reform would break the promise we made to get our fiscal house in order, which poses its own economic risks. And to undo only part of it by heaping additional across-the-board cuts on other parts of the budget, as some have proposed, would compound the worst elements of an already poor approach.

These problems are real and they are here. We must confront them, and I believe we can confront them. We have a road map in front of us for how to do it. It’s the recommendations of the president’s fiscal commission, which was headed by former Republican Senator Alan Simpson and former White House Chief of Staff Erskine Bowles, a Democrat. The Simpson-Bowles Commission has spelled out, in a bipartisan way, exactly what hard choices we will need to make. I believe that’s the framework we should be discussing.

Simpson-Bowles implores us to look at all elements of the budget. Domestic spending and defense spending will both have to be examined closely for places where reductions can be made over time in a way that will not harm the economy or national security. Mandatory programs, such as Medicare,  need to be looked at to control their explosive growth in costs. And – here’s the sticking point for many – Simpson and Bowles made it clear that revenues must also be addressed. To quote from their report: “There is no easy way out of our debt problem, so everything must be on the table.”

Last year, the government’s tax revenue fell to its lowest rate in 60 years, as compared to the size of the economy. The recession, of course, is a major factor, but so also are historically low tax rates. So, too, is the unreasonable complexity of our tax code. We now spend more than $1.1 trillion a year on tax breaks and other tax expenditures. That’s more than we spend on our national defense. More than we spend on Medicare, or Medicaid. All of these specific tax provisions have made the code unmanageable, so that it now represents the single largest compliance burden a small business owner will face in dealing with the federal government. If you’re interested in reducing government regulation on businesses, look no farther than the tax code.

I am encouraged to say that I am not alone in Congress in these views. Last year, I joined a group of more than 100 members of Congress from both parties. We stood together in support of what is called a grand bargain on deficit reform. These are lawmakers who are willing to work together and compromise on a package based on the Simpson-Bowles framework.

This is what gives me confidence that we can come together to get this done. Despite all the news to the contrary, I have found many friends across the aisle to work with on legislation. Senator Rob Portman of Ohio and I have worked together on a piece of comprehensive legislation that creates a national energy efficiency strategy. We are working hard now to get that on the floor. Johnny Isakson of Georgia is working with me on biennial budgeting. Thad Cochran of Missouri and I both want to increase on-the-job training. Mark Kirk of Illinois and now Pat Toomey of Pennsylvania are working with me to end outdated sugar subsidies. And Senator Ayotte and I have found many things to work on together, from defense of the shipyard in Portsmouth to small business to veterans.

I may disagree on many things with my Republican friends, but we find ways to work together on shared goals. And what goal could we all share that’s more important than this – the health and prosperity of our middle class and our entire nation.

So I think we can and will solve the problems laid before us. We will find a way to come together around the tough choices that need to be made. And we will find a path forward to a robust economy and a productive nation.

I hope all of you will support me in that vision. Thank you.