Durbin discusses how to get economy back on track with local business leaders
U.S. Sen. Dick Durbin, D-Springfield, believes decreasing health care costs, reining in the cost of entitlement programs like Social Security and Medicare, and further educating and retraining the workforce are keys to restarting the nation's economy.
The Senate majority leader was in Collinsville to meet with metro-east business and civic leaders to discuss the financial challenges they continue to face.
As one of President Barack Obama's appointees to the Deficit Commission, Durbin has analyzed and discussed potential solutions as the nation attempts to emerge from economic recession. He said a sluggish real estate market, high unemployment and soaring health care costs continue to block the road to economic recovery.
That means adjusting the financing requirements under the housing industry. Durbin believes that the number of home owners who are "underwater," or owe more on their homes than they're worth, needs to come down before the nation's 15 million unemployed Americans -- 9 percent unemployment rate --can find jobs and re-energize the economy.
"I think it will be moving back to the day when you better show some savings and a decent income to be considered for a mortgage," Durbin said. "That will slow down the path of growth in this industry, and it's a central industry to our economy. So that is one of the elements that we're dealing with here when we're talking about the recession. I think, frankly, I don't think we will bottom out and start the ascension until we get the real estate part of this issue right."
Those displaced workers need to seek education and training, he said. Many might not return to their previous jobs and might not hold a job in the future that reflects their skills.
"They need to be thinking about new approaches, new training, new experience, new education," he said. "That's tough. It's tough for anybody ...it's certainly tough for them because many of them had comfortable lives before they faced unemployment. It's one of the aspects we face."
Durbin then said that the government cannot continue its level of spending to ensure any fiscal stability. He said that 40 cents is borrowed for every dollar spent in Washington. The national debt has spun out of control and has surpassed $14 trillion.
"Unsustainable, just can't do it," he said. "And whether you're buying a missile or paying for food stamps, you can't keep borrowing money from China to keep this economy moving forward."
When it comes to dealing with the cost of health care, Durbin said cuts in Social Security and Medicare also have to be considered.
"We have to deal with entitlements," he said. "This is the third rail. ... If we don't touch the health care costs facing our nation, we will never balance the budget."
The Deficit Commission proposed its plan, which calls to reduce the national debt by $4 trillion over a decade. This proposal did not get enough votes to pass out of the commission.
Durbin said there should be a sense of urgency to reach a solution. He said the commission agreed that nothing should be initiated until the country's economy is clearly out of recession.
"Don't start deep cuts until we're out of the woods here," he said. "We don't want to double dip. We don't want to see unemployment growing again. And then, let's get serious. Let's put spending cuts and this evaluation of tax expenditures on the table, and let's have targets that are enforceable."