Idaho's Crapo cites Bernanke's testimony, warning return to recession absent swift budget and tax deal

Sen. Mike Crapo, the No. 2 Republican on the Senate Banking Committee, said Tuesday that Federal Reserve Chairman Ben Bernanke's testimony affirms his view that a deal on cutting U.S. debt is vital to economic stability.

Crapo also is a member of the Senate's bipartisan "Gang of Six" that's been working on a deal and served on President Obama's 2010 deficit reduction commission.

"Chairman Bernanke told us that significant, comprehensive debt-reduction efforts are necessary to improve our economy," Crapo said in a news release after Bernanke's testimony in committee Tuesday. “With across-the-board tax increases looming at the end of this calendar year for every single American family and for many small businesses, we need to reach consensus as soon as possible to avoid these sharp tax increases that will stifle job creation and growth at a time when our economy cannot afford it. We need to send the message to private-sector job creators and the world markets that the U.S. has a plan to reduce its debt and spur economic recovery. This is not about more government spending; it is about reducing the debt and implementing tax reform that will encourage investment and job creation.”

Crapo's news release follows:

FED CHAIRMAN: FOCUS ON NEED FOR DEBT REDUCTION

Senate Banking Committee discussion includes upcoming “fiscal cliff”

Washington, D.C. – U.S. Federal Reserve Chairman Ben Bernanke says reducing federal debts and deficits are important factors in improving the nation’s economic recovery and the creation of new jobs. Testifying before the Senate Banking Committee, of which Idaho Senator Mike Crapo is a member, Bernanke warned Congress that it is important to develop a long-term plan to reduce U.S. government debt levels while avoiding massive tax increases or spending cuts.

“Chairman Bernanke told us that significant, comprehensive debt-reduction efforts are necessary to improve our economy,” Crapo said following the hearing. “With across-the-board tax increases looming at the end of this calendar year for every single American family and for many small businesses, we need to reach consensus as soon as possible to avoid these sharp tax increases that will stifle job creation and growth at a time when our economy cannot afford it. We need to send the message to private-sector job creators and the world markets that the U.S. has a plan to reduce its debt and spur economic recovery. This is not about more government spending; it is about reducing the debt and implementing tax reform that will encourage investment and job creation.”

Crapo said it is important for members of Congress to hear Chairman Bernanke’s call to establish fiscal responsibility. The Chairman noted in his opening testimony, that if Congress does not act legislatively to deal with the coming “fiscal cliff,” it could lead the country back into a recession.

Bernanke said, “The Congressional Budget Office has estimated that, if the full range of tax increases and spending cuts were allowed to take effect—a scenario widely referred to as the fiscal cliff—a shallow recession would occur early next year and about 1.25 million fewer jobs would be created in 2013.” He continued, “The most effective way that the Congress could help to support the economy right now would be to work to address the nation’s fiscal challenges in a way that takes into account both the need for long-run sustainability and the fragility of the recovery.”

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Yawnfest

Crapo can wake me up when he has something to actually say instead of politispeak.

You might want to wake up now....

He's saying, "I told you so."

Naw

He's saying "don't bother me with facts, especially until after the election".

Time to Lead, not BS

Senator Crapo is in the ideal political position, he is in a republican "seat for life".
Barring a "toe tapping" incident he cannot be defeated in Idaho.
So instead of more BS press releases, how about joining with a few other Senators and introduce Simpson-Bowles as a starting point and ignore that idiot Grover Norquist that all republicans seem to live in fear of.

Obama walked away from .....

Simpson-Bowles -- you might want to look to the White House if SB is what you want.

Story from April on Simpson-Bowles

"WASHINGTON -- Chairman of the Senate Budget Committee Kent Conrad (D-N.D.) said on Sunday that he urged President Obama not to publicly support a much-touted bipartisan debt-reduction plan out of fear that it would produce reflexive Republican opposition.

"Appearing on Fox News Sunday, Conrad beat back criticism of his party's approach to fiscal matters, saying it was inaccurate to accuse Congressional Democrats of not having passed a budget or not having adopted a serious approach to reducing the debt. Pressed as to why the president sat on the sidelines when the so-called Bowles-Simpson proposal was introduced, the North Dakota Democrat noted that proposal never would have seen the light of day had the White House not created the fiscal commission in the first place.

"He then revealed that he personally advised Obama not to back Bowles-Simpson -- which achieves trillions of dollars of debt reduction through a mix of spending cuts, tough entitlement reforms, and tax reforms -- out of fear that it would have been politically counter-productive."

Conrad's fault.

.

Lower mortgage interest rates and relax lendee qualifications.

Create another bubble---that's the governmental solution.
Incredible lack of foresight guided by the corrupt, self-interested cronies that will eventually bankrupt a once prosperous nation.
True citizen representation in this Country was bought, paid for and dissolved long before many of you were born.

Raw Meat

for Danny's Demo Dancers and wannabee Obamunist slaves.

Here's what Bernanke said...

"The second important risk to our recovery, as I mentioned, is the domestic fiscal situation. As is well known, U.S. fiscal policies are on an unsustainable path, and the development of a credible medium-term plan for controlling deficits should be a high priority. At the same time, fiscal decisions should take into account the fragility of the recovery. That recovery could be endangered by the confluence of tax increases and spending reductions that will take effect early next year if no legislative action is taken. The Congressional Budget Office has estimated that, if the full range of tax increases and spending cuts were allowed to take effect--a scenario widely referred to as the fiscal cliff--a shallow recession would occur early next year and about 1-1/4 million fewer jobs would be created in 2013.3 These estimates do not incorporate the additional negative effects likely to result from public uncertainty about how these matters will be resolved. As you recall, market volatility spiked and confidence fell last summer, in part as a result of the protracted debate about the necessary increase in the debt ceiling. Similar effects could ensue as the debt ceiling and other difficult fiscal issues come into clearer view toward the end of this year.

The most effective way that the Congress could help to support the economy right now would be to work to address the nation’s fiscal challenges in a way that takes into account both the need for long-run sustainability and the fragility of the recovery. Doing so earlier rather than later would help reduce uncertainty and boost household and business confidence."

A bit more nuanced than Crapo's spin. Bernanke isn't saying don't raise taxes; he's saying don't raise taxes AND cut spending at the same time, and get your act together, and quit the brinkmanship game of chicken over the next debt-ceiling increase. I don't see Obama's idea of targeted tax increases along with spending on safety-net programs and stimulus money for infrastructure improvement as counter to what Bernanke was saying.

So

Bernanke will support min wage for all Fed employees, including himself, until he learns to speak Englsh?

The Almighty Hath Spoken

Give me a break. As if Crapo is some kind of oracle or something. What was he telling us to do during the summer of 2008? Certainly nothing that would have averted what happened that fall (pun intended).

Job Creators?

Not sure who Crapo is referring to. The wealthy (Romney, for example) have been creating jobs for people overseas and then lining their own pockets with the money they saved. They don't care about creating jobs here.

Interesting that Obama invited....

The CEO's of Boeing and GE to serve on his Jobs Council - 2 of the biggest outsourcers in the country.

Amazing

how the politicians still cater to an organization that is not part of the federal government and that is ruled by foreign banks. Crapo, you should listen to Ron Paul and do everything in your power to help do away with the Federal Reserve.