Pelosi: Stimulus Key to Smaller Deficit

Posted February 23, 2009 at 1:57pm

Speaker Nancy Pelosi (D-Calif.) on Monday called the nearly $790 billion stimulus bill “an essential part of reducing the deficit,” suggesting the components of the bill would pay for themselves in time.

“I think the stimulus spending is an essential part of reducing the deficit, because it will stimulate the economy,” said Pelosi, who spoke to reporters in the East Room following remarks by President Barack Obama at the White House fiscal responsibility summit.

“Investments in education bring more money to the Treasury than any investment or tax credit or anything you can name,” Pelosi said. “If you don’t make those investments, your deficits will be greater.”

Pelosi’s arguments were reminiscent of those made by former President George W. Bush, who argued that tax cuts would eventually pay for themselves by stimulating economic growth and increasing receipts.

Pelosi praised Obama’s remarks at the event, in which he focused on honest budgeting that avoids traditional gimmicks for making the deficit look smaller than it is. “Wasn’t that music to your ears,” she said of Obama’s determination to face the “realities” of the budget.

Pelosi said she sent letters to committee chairs last week ordering them “to subject every dollar under the jurisdiction of their committee to scrutiny” to ensure there is no “waste, fraud and abuse” and that “we’re getting the bang for the buck for the American people that that dollar was intended to do.”

Asked about an article in the New York Times that said Democratic leaders had pressed Obama to wait to overhaul Social Security, Pelosi appeared unfamiliar with the piece — saying she had just returned from Afghanistan — but she said, “The solvency of Social Security is very, very important to us.”