Before the senior class at Pottsville Area High School on Monday, Republican U.S. Sen. Pat Toomey said he didn’t approve of the Federal Reserve’s recent effort to pump money into the nation’s ailing economy.
“Do I think the Fed’s decision will help stimulate the economy? No, I do not. This is the third round of quantitative easing, or QE3. Does anyone know what quantitative easing really means? It’s printing money. We don’t do it with a physical printing press any more. The main creation of money now occurs electronically and that’s what the Fed is doing. I think it’s a very bad idea. I think it’s very dangerous,” Toomey said to the 275 seniors in the high school auditorium, Monday morning.
The school district invited Toomey, Allentown, and Judge John E. Jones III of the U.S. Middle District Court, Harrisburg, to speak to the senior class in observance of the 225th anniversary of the signing of the U.S. Constitution.
Monday was Constitution Day.
The students were given the opportunity to ask questions. Senior Greg Revenis asked Toomey for his thoughts on the Fed’s Sept. 13 decision to stimulate the housing market by buying $40 billion in mortgage-backed bonds every month from large banks in an effort to free up capital and spur lending.
“I think it dramatically increases the chances that in time this huge expansion and the amount of money that’s floating around the economy will lead to inflation,” Toomey said.
Toomey also identified other “real problems” in the economy.
“There are fiscal problems. We have a government that’s overspending. We got a deficit that’s too large. We have tax policy that’s not conducive to maximizing economic growth. We’ve got bad regulations. We’ve got a number of policies that are holding back our economy. But the money supply’s not one of them. And unfortunately the Fed deems itself responsible for trying to goose this economy and putting a flood of cash into it. It might have the effect of increasing certain asset values. The stock market kind of likes that, so you’ll see a rise in stock prices. But I don’t think it’s good for the long-term prospects of the economy. At the end of the day, prosperity comes from the creation of wealth, producing goods and services, actual economic activity, not how many pieces of paper you circulate,” Toomey said.
Constitution Day commemorates the formation and signing of the U.S. Constitution on Sept. 17, 1787.
On the topic, Randy Rubright, a Pottsville Area High School senior, asked Toomey if he believed the Constitution should be followed strictly according to its text, or should it be considered a set of guidelines which are open to interpretation.
“This is a great question. It’s spurred a huge debate in this country for a long time. I believe strongly we should take it very literally. We ought to take it as written. We ought to understand it as it was understood at the time. And if we don’t agree with something that’s in it, then we ought to change it. And we’ve done that many, many times. The Constitution is not a perfect document by any means. We’ve improved on it with a series of amendments. The problem that I have with simply diminishing the Constitution and treating it as just a nice idea is in the absence of a very well-defined document that you’ve come to rely on, you really have nothing. If it means whatever somebody wants it to mean, then it has no set meaning, and it would be very problematic to have a government that doesn’t have a well-defined set of boundaries,” Toomey said.
Jones stepped up to the microphone to add his insights as well.
“I agree fully with Sen. Toomey in terms of the text and the rule of law. What we should do as judges is to not depart from that text, that terrific bedrock document, as to what we should do. We are a nation of laws,” Jones said.
But there are cases that will always force judges to reexamine the Constitution and how it would apply to problems in modern times, Jones said.
“We do the best we can,” Jones said.
Rubright appreciated their answers.
“That’s one of the simplest questions you can ask about the Constitution, but it always starts debates. There’s always proponents on either side. I thought they gave very full answers. It falls in line with my belief about the Constitution, which is we should follow it as a set of rules. If we interpret it too much, it blurs the original design,” Rubright said.
Afterward, Toomey also offered the press his perspectives on the upcoming elections, including the presidential race.
“I think Romney has a very good chance in Pennsylvania. I can give you many reasons why, but the biggest single factor, in my view, is the fact that I was able to win a statewide election for federal office in 2010. I think the political environment we’re in is very similar in many ways. And I think Gov. Romney can appeal to voters across the commonwealth. I think he has a real shot at carrying Pennsylvania,” Toomey said.
He also mentioned the Republican candidate hoping to unseat U.S. Sen. Bob Casey, Tom Smith of Armstrong County.
“I think that will be very competitive, probably go down to the wire. Tom Smith is certainly the underdog in this race. I think he knows that. But you got two good men, two strong candidates, and I think it’s too tough to call,” Toomey said.
He also added to his statements on the economy.
“We got to get spending under control. We’ve got a federal government that’s doubled in size in the last 10 years. We can’t keep doing that. We haven’t had the discipline. The government passed one stimulus bill after another which didn’t stimulate economic growth. There were various bail-outs, and these things all cost money. And they haven’t given us the job creation we were promised. We need to get spending under control and allow the private sector to create the jobs that we need,” Toomey said.