Coons Works Through The Issues In Budget Conference Committee

In budget conference committee, Senator Coons focuses on budget’s impact on long-term unemployed

Committee has been tasked with reconciling budgets approved by House and Senate  

WASHINGTON – In Wednesday’s meeting of the budget conference committee, U.S. Senator Chris Coons (D-Del.) questioned the head of the Congressional Budget Office about the impact of Congress’ current spending decisions on the nation’s long-term unemployed.

“While short-term unemployment has come back down, long-term unemployment remains very high, and is persistent — and worryingly so, both in terms of the human cost, and the long-term cost for our economy,” Senator Coons said.

Questioning Congressional Budget Office Director Douglas Elmendorf, Senator Coons continued: “You've testified before that not all cuts are the same, and that there are some ways in which we are cutting that are hurting our long-term competitiveness — that short-term cuts in things like education, or infrastructure, or research and development produce longer-term reductions in our capacity; and that we should be prioritizing things that will accelerate growth; that we should not be simply trying to get through this difficult fiscal time in a way that focuses on austerity; that we should also be investing in a way that sustains growth.”

Asked about policies that could accelerate growth and help the long-term unemployed, Director Elmendorf said, “Of all non-defense discretionary spending, half represents investment of some sort. About 20 percent of non-defense discretionary spending is investment in physical capital, such as highways, another 15 percent goes for education and training, and about 10 percent goes for R&D, such as health research. Over all, we think those investments help to build a stronger economy in the future and cutbacks in those investments would reduce output and income in the future.”

The problem of long-term unemployment, Elmendorf noted, also “has important economic effects over time… It poses a very large risk of there being some set of people who will not find their way back to work at all or will not find their way to the productive sort of work that they were in before they lost their jobs.”

Elmendorf said the CBO has “reviewed the evidence on a large number of different ways of trying to help people get back into the labor force,” a number of which “have been successful on a small scale and have not been tried on a large scale.” Elmendorf pledged to work with Senator Coons on developing policies that help the long-term unemployed get back to work.

Delaware’s long-term unemployment rate is 3.1 percent. The state’s overall unemployment rate is 7.3 percent.

Senator Coons is one of 29 members of the conference committee appointed by leaders of the House and Senate to reconcile the two chambers’ respective budgets. If the conference committee is able to negotiate and approve a budget by December 13, the House and Senate appropriations committees will attempt to move forward on a spending bill for the remainder of Fiscal Year 2014. As a member of the committee, Senator Coons has called for balanced deficit reduction that enacts a circle of protection around the most vulnerable and promotes our long-term competitiveness and economic growth.

Senator Coons is a member of both the Senate Budget Committee and the Senate Appropriations Committee.

In floor speech, Senator Coons calls for budget deal that invests in job growth, replaces sequester

“Sequester has been devastating to Delaware and the whole nation, and we need to replace it with a smarter, more balanced set of spending reforms that maintain investments that will allow our country to be competitive.” 

- As Delivered on November 13, 2013 -

Mr. President, I come to the floor once again to talk about jobs and economic growth. We are continuing to see signs of a steadily improving economy, with more than 200,000 jobs created last month in the jobs report released just last Friday. Of those, 19,000 were new manufacturing jobs. We’ve had 43 straight months of private-sector job growth, but the unemployment rate remains stubbornly high, and sadly, particularly for those who are long-term unemployed.

 

Earlier today, the budget conference committee met and we heard from Congressional Budget Office Director Dr. Elmendorf. He let us know that in his view, the uncertainty, the lack of clarity about the path forward for all of us here, for the solutions we need for the budget and for the deficit, is one of the greatest drags on job creation and on competitiveness for our country and our economy.

 

In our budget conference committee, we need to come together and reach a balanced budget deal that repeals sequester and allows the Appropriations Committee, ably led by Chairman Mikulski, to move forward with an omnibus appropriations bill for this fiscal year. 

 

We cannot afford, in my view, another long-term continuing resolution at the current sequester levels. As we heard today from Dr. Elmendorf and as we've heard from other sources, the sequester will have killed 750,000 jobs by the end of the year, and next year these ongoing, steady, grinding cuts could kill another 800,000. These are jobs, these are investments by the federal government that could be helping the private sector create jobs and repairing our crumbling infrastructure. 

 

In Delaware alone, we have 175 deficient bridges being neglected. These are jobs that help families to put food on the table. In Kent County, Delaware, where Dover Air Force Base is, sequester has hurt those who serve our nation, who operate the base, and who serve our country valiantly. 

 

These are jobs that could be going to help research a cure for cancer. NIH supported more than 500 jobs in Delaware in 2011 and now cuts are costing those jobs and setting us back in the fight to find a cure for cancer and many other diseases. Sequester has been devastating to Delaware and the whole nation, and we need to replace it with a smarter, more balanced set of spending reforms that maintain investments that will allow our country to be competitive. 

 

In particular, Mr. President, if I might, we need to refocus on jobs by investing in infrastructure and focusing on manufacturing. In my view, the 19,000 jobs in the manufacturing sector that we just learned were created in the last month were a promising development, but far from as many as we should be filling. Why? Because manufacturing jobs are high-quality jobs. They pay more in wages and benefits. They help create secondary local service jobs. They contribute more to the local economy. And manufacturers invest more in private R&D than any other sector in our economy. 

 

As you may know, Mr. President, before I came to serve here in the Senate, before my service in county government, I spent eight years working for a manufacturing company in Delaware. At one point, I was part of a large site location team that went around the country trying to decide where to build a new state-of-the-art semiconductor chip packaging manufacturing plant. 

 

To make a long story short, in the end we decided on a location where there was a skilled and reliable workforce, a responsive government that invested in the local infrastructure, and certainly we considered other factors: tax rates and incentives offered by the state and local government. But really, the skill of the workforce and the quality of the infrastructure were absolutely essential to the decision we made – a surprising decision in terms of where we ultimately located. We invested, we were able to get up and running a state-of-the-art plant in a record amount of time and to contribute significantly to local employment and the local tax base. 

 

This taught me a lot of about the importance of infrastructure and workforce skills. If I could mention just two things: the World Economic Forum ranked the United States 25th overall in infrastructure, a key drag on our competitiveness. The American Society of Civil Engineers says we're falling behind by $250 billion a year in deferred maintenance in investments not made by federal, state, and local governments. 

 

In my view, the case for infrastructure investment is a no-brainer. This is exactly the sort of thing that we should be doing, and that the sequester is preventing us from doing – making wise, timely, and needed investments in improving our infrastructure. 

 

Another critical foundation for growth, as we saw, was a skilled and adaptable workforce. We can be the world's manufacturing leader again, but not without investing in workforce skills and workforce training. There are many programs that can help make this possible. One I like to point to is the federal, state and local partnership called the Manufacturing Extension Partnership, that helps make it possible for university-based researchers to partner with local manufacturers to deliver skills training that keeps them at the cutting edge, that makes them more productive. 

 

In today's modern manufacturing workplace there are fewer people but they are more productive because of their skills. Back in August I visited a new facility, the ILC/Grayling plastics manufacturing plant in Seaford, Delaware, which is a great example of what it will take for America’s manufacturing resurgence to continue and to grow. This plant has already brought more than 100 jobs to Sussex County, Delaware. 

 

These aren't the manufacturing jobs of the past. The men and women who work on this line need to be able to collaborate and communicate, to do advanced math and quality control work, and to oversee high-tech machinery and have an intimate understanding of the process that they are working with. In the end, this company looks forward growing, to probably doubling the number of jobs at this facility in Sussex County. And to me, in an even more exciting development, these are jobs that had left the United States to go south to a lower-wage country and that have been brought back – brought back from Juarez, Mexico to Seaford, Delaware where there are Delawareans employed at this newly expanded manufacturing facility. 

 

Let me conclude, if I might, Mr. President, by simply saying that here in Congress we have the opportunity, if we work together across the aisle, to find a pathway towards making these investments in the skills of our workforce, in the infrastructure of our country that will help grow our economy and help create good manufacturing jobs today and tomorrow. 

 

One of the core challenges we face in the budget conference committee is to find a path forward that will respond to the call that I hear up and down the state of Delaware and I presume my colleagues hear from their home states. That we should make principled compromises that allow to us invest again, to replace the sequester with a more responsible and balanced package of revenue and cuts that allow us to return to investing in the skills and infrastructure necessary to grow our economy. 

Update: 

Senators Coons, Kirk introduce bipartisan bill to create a national manufacturing strategy

American Manufacturing Competitiveness Act would spur job growth, improve global competitiveness of U.S. manufacturers

WASHINGTON – U.S. Senators Chris Coons (D-Del.) and Mark Kirk (R-Ill.) introduced theAmerican Manufacturing Competitiveness Act on Thursday to bolster the competitiveness of the manufacturing industry in the United States. The bill would require the development of a national manufacturing strategy, boosting the traditional and high-tech manufacturers that employ nearly 12 million Americans. This simple bill does not cost the federal government any money, and will have a powerful impact on manufacturing jobs.

“Manufacturing has enormous power to create jobs and drive America’s economic recovery,”Senator Coons said. “While many of our global competitors have clear national industrial policies, the U.S. government does not have a coordinated strategy for supporting America’s manufacturers. We need a national strategy that looks at skills training, R&D, trade, and the wealth of factors that contribute to our manufacturers’ success. This is a common-sense, bipartisan bill that will ensure the federal government is doing everything it can to create the conditions necessary to help America’s manufacturers grow and create jobs.” Senator Coons is the founder of the Manufacturing Jobs for America initiative in the Senate, which this bill will now join.

“The United States is a worldwide leader in manufacturing, and keeping this industry competitive is crucial to maintaining our economic edge in the global marketplace,” Senator Kirk said. “Manufacturers in Illinois employ more than half a million workers with quality jobs and account for 13.3 percent of the total state economic output. Our bill will ensure that the United States manufacturing industry remains competitive and creates new high quality jobs for generations to come.”

Senators Sherrod Brown (D-Ohio) and Roy Blunt (R-Mo.) are also cosponsors of the bill. Representative Dan Lipinski (D-Ill.-3) introduced companion legislation in the House (HR 2447) earlier this year.

The manufacturing industry contributes $1.8 trillion to the U.S. economy each year, and on its own would rank as the world’s tenth largest economy. Current federal programs and incentives support conditions for growth in the industry, yet there is no overarching national strategy. The American Manufacturing Competitiveness Act sets goals for a U.S. manufacturing strategy and requires the Administration to analyze every four years factors that impact manufacturing competitiveness.

The bill is supported by the Alliance for American Manufacturing, American Iron and Steel Institute, American Small Manufacturers Coalition, Association for Manufacturing Technology, Dow Chemical Company, DuPont, International Association of Machinists, National Council for Advanced Manufacturing, National Defense Industry Association, National Tooling and Machining Association, North American Die Casting Association, Precision Machined Products Association, Precision Metalforming Association, United Steelworkers, and United Auto Workers.

Update II:

Senator Coons, colleagues introduce innovative bipartisan infrastructure bill

BRIDGE Act will jump-start investment, job creation, and boost U.S. competitiveness

WASHINGTON – A bipartisan coalition of ten U.S. senators that includes U.S. Senator Chris Coons (D-Del.) introduced legislation Thursday to establish a new infrastructure financing authority to help states and localities better leverage private funds to build and maintain the nation’s outdated infrastructure. The Building and Renewing Infrastructure for Development and Growth in Employment Act, or BRIDGE Act, helps to address the nation’s alarming investment shortfall in maintaining and improving its transportation network, water and wastewater systems, and energy infrastructure. The legislation would provide an additional financing tool for states and localities, which can create new jobs here at home while also increasing our nation’s economic competitiveness.

"Investments in America's infrastructure are investments in American jobs," Senator Coons said. "Construction jobs, production jobs, and jobs at nearly every American business all depend on functioning infrastructure. Our country needs to be investing more in its infrastructure, not less. The bipartisan BRIDGE Act is an innovative approach to getting the funding we need to sustain and strengthen America's critical infrastructure."

America currently spends roughly 2 percent of its GDP on infrastructure — about half what it did 50 years ago. By comparison, Europe spends around 5 percent, and China spends 9 percent of GDP on infrastructure. According to the World Economic Forum’s Global Competitiveness Report, the United States currently ranks 19th among 148 countries surveyed in quality of overall infrastructure compared to our global competitors.

“We put off and put off these investments because it’s politically convenient, but when we do, we’re only putting off the inevitable,” Senator Coons continued. “The American Society of Civil Engineers estimates that in the next five years, our country will come up about $1.1 trillion short of what it needs to bring American infrastructure to even adequate condition. When we neglect America’s infrastructure, we’re actually adding to America’s debt. We cannot keep kicking this can down the road, especially since this road is falling apart.”

To begin addressing this shortfall, the BRIDGE Act will establish an independent, nonpartisan financing authority to complement existing U.S. infrastructure funding. The authority would provide loans and loan guarantees to help states and localities fund the most economically viable road, bridge, rail, port, water, sewer, and other significant infrastructure projects.  The authority would receive initial seed funding of up to $10 billion, which could incentivize private sector investment and make possible up to $300 billion in total project investment. The authority is structured in such a way as to make it self-sustaining over time.
 

• The BRIDGE Act includes broad eligibility for funding:

Projects would have to be at least $50 million in size, and be of national or regional significance to qualify. Five percent of the authority’s overall funding would be dedicated to projects in rural regions, and rural projects would be required to be $10 million in size.
 

• The BRIDGE Act addresses current gaps in infrastructure financing:

The authority would finance no more than 49 percent of the total costs of the project in order to avoid crowding out private capital. Loans and loan guarantees would be subject to modest additional fees, which will allow the authority to quickly become self-sustaining over time.
 

• The BRIDGE Act establishes independent, non-partisan operations:

Having project finance experts in-house will help states and localities go toe-to-toe with private sector partners to ensure that taxpayers are getting good value for our investments through public-private partnerships. The authority would operate independently of existing federal agencies, led by a Board of Directors with seven voting members and a CEO, all of whom would be required to demonstrate proven expertise in financial management and be confirmed by a vote of the Senate.

In addition to Senator Coons, the BRIDGE Act is sponsored by Senator Mark Warner (D-Va.), Roy Blunt (R-Mo.), Lindsey Graham (R-S.C.), Kirsten Gillibrand (D-N.Y.), Dean Heller (R-Nev.), Amy Klobuchar (D-Minn.), Roger Wicker (R-Miss.), Claire McCaskill (D-Mo.), and Mark Kirk (R-Ill.).

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