[Congressional Record Volume 141, Number 61 (Monday, April 3, 1995)]
[House]
[Page H4086]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                      A TAX CUT OR A TAX INCREASE

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Maryland [Mr. Wynn] is recognized for 5 minutes.
  Mr. WYNN. Mr. Speaker, I rise this evening to join the fray in the 
debate about the tax increase that we are about to vote on this week. I 
am very concerned about the issue of tax fairness. I think what we have 
seen over the past couple of weeks is a consistent pattern wherein the 
Republican majority has consistently stolen from the poor to give to 
the rich. This is not an issue of whether there ought to be tax break 
for middle class, working poor people in America, because that is not 
what there tax break does. It goes to people who make as much as 
$200,000 a year, and I think that is wrong.
  This was dramatically illustrated when we analyzed the proposal to 
cut the school lunch program, and the Republicans suggested we will cut 
the school lunch program, we will underfund it in comparison to 
anticipate needs, we will not adjust for inflation, so we can cut money 
out of this program to help fund the tax cut.
  It is evident in the attempts to cut the college scholarship program. 
Once again, taking from the middle class, the working class, in order 
to fund tax increases that benefit people who make up to $200,000 a 
year. It is my view that if there is going to be a tax break, it ought 
to be given to people who are making under $100,000 a year, not the 
wealthy people, not the attorneys and the Congress people and people 
like that who do not need it.
  Or, and there seems to be a lot of sentiment that this is what ought 
to be done, we ought to take that money and put it into deficit 
reduction. Even when I talk to some of the wealthy people who would get 
this tax break, and I say do you, making $150,000 a year, want this 
$500 per child tax break, or do you want to see this money go for 
deficit reduction? Overwhelmingly, the professionals, more well off 
people, say Congressman, what we need to do is put this money into 
deficit reduction.
  So it seems to me the Republicans are wrong on two accounts. They are 
wrong for taking money out of the mouths of children to fund a tax cut 
for the wealthy, and for not responding to the legitimate needs of the 
country, which is deficit reduction.
  What I wanted to focus on today is yet another
   indictment of the Republican tax proposal in that it creates an 
additional tax on working people, a specific category of working 
people, Federal employees, I rise today to express my grave concern for 
several measures contained in H.R. 1327. I am concerned specifically 
about title IV of this measure.

  While my colleagues on the other side of the aisle will tell you they 
are reducing the taxes for the American family, in actuality they are 
increasing taxes for some of our hardest working citizens, Federal 
workers. Under the proposal coming forth this week, 2 million people 
working for the Federal Government will be taxed an additional 2.5 
percent of their income. This so-called contribution comes in the form 
of an additional contribution by these Federal employees toward their 
retirement. What this amounts to on average is a $750 per year tax on 
the average Federal employee who makes $30,000 a year.
  Now, what I cannot understand is how they are going to receive on the 
one hand a $500 per child tax break, but yet on the other hand lose in 
the form of an additional contribution, additional taxes toward their 
retirement, $750 a year. They are going to be $250 in the hole.
  There may be some question in Republican minds as to whether this is 
a tax. Well, the Congressional Budget Office scored this as a revenue, 
which means it is in fact a tax. Apparently the CBO knows it is a tax, 
yet the chairmen of the Committee on the Budget and the Committee on 
Rules would not recognize this as being the case.
  The proposal to increase the employee contribution is so ludicrous 
that even several Members of the Republican Party have stated should 
their party continue to pursue this proposed tax credit, they would 
vote against the measure.
  Let me repeat, and urge my colleagues to listen carefully. This bill 
coming before the House tomorrow taxes Federal employees making $30,000 
a year to provide a tax credit for those making up to $200,000 a year. 
Each Member of this House has Federal workers in their district. I hope 
you will stand up and tell them you are imposing a tax on them so you 
can give someone making $200,000 a tax break.
  As the saying goes, the devil is in the details, and this is 
certainly the case. The Federal contribution would be increased from 
7.0 percent to 9.5 percent of salary in order to meet this requirement. 
This is an unusual situation because initially it was couched as a 
suggestion that there needed to be some sort of change in the system, 
that the retirement system was somehow flawed. But in fact a study by 
the Congressional Research Service indicated that there was no unfunded 
liability. So if it is not to solve unfunded liability, it can only be 
to round up money to provide tax benefits for the wealthy.
  Mr. Speaker, I hope we will reject this ill-conceived recommendation.
  

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