Thank you Chairman Greenspan for appearing before this Committee. I always look forward to
hearing your insights on monetary policy and the economy.
With continued turmoil in many foreign economies, it is comforting to know that the U.S. economy remains fundamentally sound and growing. Our currency is strong, and we are
enjoying low inflation, favorable growth, and good employment opportunities.
A great deal of our economic stability is the result of sound monetary policy that has kept
inflation in check. Under your guidance, the Federal Reserve has done an excellent job of
focusing on stable prices, which is the key to strong economic growth. There is no doubt that
your solid leadership has produced confidence and certainty in the U.S. economy.
The focus on sound fiscal policy has also been a positive factor in our economy. Under a
Republican Congress, the deficit outlook has changed dramatically, from a predicted deficit of
$253 billion for next year, all the way down to the possibility of a surplus. This, I believe, has
fostered lower interest rates that act as a major tax cut for millions of American families.
However, our current growth and positive fiscal statistics should not lure us into complacency. The Federal Reserve must remain focused on price stability -- and Congress should remain
focused on preserving budget balance, reducing wasteful spending, and easing the tax burden. I
will continue to work to reform the Humphrey-Hawkins Act and replace it with legislation that
focuses on price stability as the Fed's primary goal.
I am very interested in hearing the Chairman's current views on the situation in Asia. Clearly,
recent events there will pose problems for our economy, particularly in the export sector. By the
end of 1997, U.S. exports made up almost 14% of GDP. However, the failure of many
governments to keep their currencies stable means that the people in these countries will not be
able to buy as much from the U.S. In turn, this slowdown in the export sector may have a
negative impact on corporate-profits margins here, leading to fewer new jobs, a slowdown in
wage growth and less investment.
We have to come up with better ways to identify and prevent such crises -- both in the near-term
and in the future. Congress' role is to make sure that both the United States and the IMF promote
pro-growth policies, including low tax rates, sound banking systems and stable currencies.
Our country has a role to play in promoting economic growth, not just at home but also abroad.
Why? Because our nation strongly believes in freedom, justice, democracy, human rights and
capitalism -- and we're the only nation committed to exporting these ideas and principles around
I welcome Chairman Greenspan and I'm anxious to hear his analysis.
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