[Congressional Record Volume 140, Number 87 (Friday, July 1, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: July 1, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                TAX POLICIES THAT DISCOURAGE RISK-TAKING

  Mr. LUGAR. Mr. President, I rise today to share with my colleagues in 
the Senate a letter I recently received from a small business owner 
from Buck Creek, IN.
  Small businesses have been the primary engine of job growth over the 
last decade. Yet despite the importance of small businesses to our 
economy, the Federal Government has adopted tax policies that 
discourage risk-taking by Americans who create jobs through their 
capital, their ideas, and their entrepreneurial energy.
  During the last year I have frequently spoken about the heavy tax 
burden that small business owners are asked to endure and the negative 
effects of the 1993 Clinton tax plan on small business job formation. 
Yet the most convincing testimony on these matters has come from small 
business owners who are striving to provide good jobs for their 
employees and a good living for their families. Beth Muehlhausen, the 
owner of Baker's Peak in West Lafayette, IN, is one such person. I ask 
that this letter be inserted in the Record.

       Dear Senator Lugar: This is a letter of inquiry. I am at an 
     impasse, and seek your council.
       As a mother of four children, I have sought to provide them 
     with an environment in their formative years conducive to the 
     building of strong character. The future will need adults who 
     are decisive, confident, caring, honest and moral. This 
     commitment to the family required that I prioritize the 
     childrens' needs by being a full-time Mom. Contrary to 
     popular belief, I hold to old-fashioned ideals that say a 
     mother is best equipped to train and raise her children. Only 
     tentatively did I enter the workforce on a part-time basis 
     when my last child entered kindergarten in 1987.
       My husband and I have supported Christian education for our 
     children during their elementary and junior high years at 
     Lafayette Christian School, a private, parent-owned, non-
     denominational Christian school. The high level of academic 
     success and personal spiritual and ethical development of our 
     four very unique children has proven the commitment to the 
     school extremely successful--though it has not been 
     without sacrifice and severe financial burden.
       As in every family, the years bring change and 
     readjustments--and when our oldest entered college in 1991, I 
     looked for more regular employment to help defray expenses. 
     My husband's conscientious commitment as a Purdue professor, 
     finally with tenure and a Ph.D., provided us with a 
     reasonable level of security at that point. However, we were 
     still struggling to avoid debt, and had the most expensive 
     years of child-rearing still ahead. My college training had 
     been in the field of education also. I graduated from Purdue 
     with a degree in secondary English education in 1971--but 
     never used my degree, as my decision to ``stay home'' was 
     strong. Going back to update educationally after so many 
     years would be time consuming and costly, I knew. So, I took 
     a job with ``Baker's Peak''--a small custom bakery, deli, and 
     caterer, utilizing my cake decorating and food preparation 
     skills developed in the years at home in my own kitchen.
       A year and a half ago the shop went up for sale. With the 
     help of an inheritance left me following my father's death in 
     1992, I was able to purchase the store. It continues to be a 
     ``scratch'' shop; we create almost any baked good or food 
     item in any quantity. Although the business has far outgrown 
     the building we occupy, we continue to produce at a breakneck 
     pace. Obviously the public is tired of prepared and fast food 
     options and appreciates our product. We have established a 
     wonderful reputation. Owning and managing the business has 
     proven rewarding; we influence lots of lives in a positive 
     manner. The stress level is acute in proportion; I work long 
     and hard for my profits. My health has suffered. I've felt 
     encouraged as the recent months went by, however, because I 
     felt that at least I was going to be able to make a 
     significant difference for my family, as well as for my eight 
     hard-working part-time employees, who make excellent wages--
     between $6 and $9 an hour.
       Recently I reviewed our family's financial status, and 
     projected needs for the coming months. Next fall we will be 
     supporting one child in Christian school, two in college, and 
     one in public high school. The usual car payments, house 
     payments, and insurance-of-teenage-driver payments will be 
     there. I felt confident we could handle the challenges 
     without going into debt as we had in years past.
       Last week, tax-time rendered a terrific blow. After 
     consulting with a professional ``tax man'', our worst fears 
     were confirmed. I would pay income tax totaling 45% of my net 
     earnings. I reeled from the news; it seemed the unemployment 
     tax, payroll tax on my employees' generous salaries, and 
     sales tax had already supported the government to a great 
     extent. I was not prepared for more than a 28 to 30%-or-so-
     rate.
       I saw a bumper sticker recently that said, ``THE SMALL 
     BUSINESS--AMERICA'S LATEST ENDANGERED SPECIES''. Along with 
     the death of the small business comes the death of an 
     American ideal--hard work, quality control, and personal 
     accountability to the customer. Too bad! And any more 
     governmental intrusion--in the form of health-care, or 
     governmental intrusion--in the form of health-care, or 
     whatever--will effectively kill businesses like mine, and 
     financially destroy their owners and owners' families. How 
     sad. Devotion to honesty and sweat of the brow are no longer 
     rewarded. Or even applauded. Instead, I feel penalized. Or, 
     worse yet, victimized. The most difficult issue to face--and 
     accept--is that I am working to the limit of my ability and 
     strength in every possible way in order to be a responsible 
     citizen and provide the best that I can for my family, my 
     employees, and the community at large. However, much of my 
     effort is going to support welfare, not for the truly needy, 
     but for those who have come to expect a ``free ride''--
     abortion clinics where irresponsible and immoral behavior is 
     accepted and condoned--or other governmental agencies in 
     which I have little confidence.
       And so I face a frustrating and formidable problem. 
     Ethically, I will not cheat on taxes. Also, I will not be 
     quick to diminish the amount of business that we do, thus 
     destroying jobs and disappointing the expectations of the 
     public. My only choice is to keep on keeping on working and 
     working and working--for what? This is truly an agonizing 
     situation.
       The system is killing me. Have I any recourse?
       I eagerly anticipate your response.
           Sincerely,
                                                 Beth Muehlhausen.

          IS CONGRESS IRRESPONSIBLE? YOU BE THE JUDGE OF THAT

  Mr. HELMS. Mr. President, before we ponder today's bad news about the 
Federal debt, let's have a little pop quiz: How many million would you 
say are in a trillion. And when you figure that out, just consider that 
Congress has run up a debt exceeding $4\1/2\ trillion.
  To be exact, as of the close of business on Thursday, June 30, the 
Federal debt stood--down to the penny--at $4,645,801,898,177.58. This 
means that every man, women and child in America owes $17,819.74, 
computed on a per capita basis.
  Mr. President, to answer the question--how many million in a 
trillion?--there are a million, million in a trillion. I remind you, 
the Federal Government, thanks to the U.S. Congress, owes more than 
$4\1/2\ trillion.

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