[Congressional Record Volume 141, Number 98 (Thursday, June 15, 1995)]
[House]
[Pages H6042-H6043]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                        THE REPUBLICAN TAX PLAN

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Florida [Mr. Stearns] is recognized for 10 minutes.
  Mr. STEARNS. Mr. Speaker, I am delighted to come down here to talk 
about the Republican budget, and specifically, the Republican plan to 
reduce taxes. I saw, Mr. Speaker, that the President came out with his 
own budget. As many of you know in the House, we have included tax cuts 
that amounted to $350 billion. It included a $500 tax credit for every 
child in America, plus it reduced capital gains.
  The Senate does not have these specific cuts, but they cut $170 
billion if we balance the budget. However, I notice in the President's 
budget he included a middle-class tax cut. It includes 96 billion 
dollars' worth of cuts, including a $500 credit per child, and $10,000 
college tuition credit for families earning less than $100,000.
  I think, Mr. Speaker, when we talk about reducing taxes, it looks 
like the President of the United States has come on board, too. I would 
like to just briefly, in this 10 minutes, set the record straight. We 
have heard for too long now the Republican budget contains a tax cut 
that hurts the poor and benefits the rich. How can I say this, Mr. 
Speaker. There is no truth to this claim.
  The Democrats argue that the Republican tax cut would benefit only 
the rich, when the fact is that the major component of our tax package, 
as I mentioned, is a $500 per child tax credit for families. Of the 
$189 billion in tax cuts we proposed over 5 years, $94 billion, or 
fully half, goes directly to families in the form of the $500 per child 
tax credit.
  Families receive other tax benefits, including expanded IRA's, repeal 
of the marriage penalty, and incentives for long-term care insurance. 
All told, families would receive $114 billion worth of tax relief under 
our plan.
  Democrats have argued and tried to argue that because of the $500 per 
child tax credit, it applies to families earning up to $200,000. It 
looks like the President here has $100,000. They go on to say this is 
somehow a tax cut for the rich, as though the children of high-income 
Americans are less deserving of tax relief than others. But even this 
argument is false, since according to the Joint Economic Committee, 
fully three-fourths of the $500 per child tax credit would go to 
families earning less than $75,000.
  For low-income Americans, the tax credit is even a better deal. 
Nearly 5 million Americans at the lowest income levels would no longer 
pay any taxes at all. So I am tired, and I think the American people 
should be tired, of the same old class warfare rhetoric that the 
Democrats continue to haul out every time we talk about tax cuts.
  The Democrats seem to believe the rich are the only people who have 
children, who got married, and that earning $75,000 makes you rich. The 
truth is the Republican tax package benefits all Americans. It is 
particularly beneficial to all families, but it also benefits groups, 
such as seniors.
  For starters, our package calls for the repeal of the 35-percent 
Social Security tax hike President Clinton rammed through in 1993. The 
Republican plan brings the rates on singles earning more than $34,000 
and couples earning more than $44,000 back to 50 percent. We would also 
raise the earning limit on Social Security benefits. Instead of 
$11,280, seniors can earn up to $30,000 before Social Security taxes 
kick in. The total savings for our American seniors is $30 billion. 
That is important to make that point.
  Furthermore, the Republican tax package gives all Americans a 50-
percent capital gains tax. According to a study released by the Joint 
Economic Committee, nearly 70 percent of those Americans who claim 
capital gains have incomes of less than $50,000.
  Republicans will ease the burden on overtaxed businesses, too. Our 
plan would save American businesses $21 billion over the next 5 years, 
money that will be reinvested and returned again and again to the 
consumer in lower prices and in higher working wages. Mr. Speaker, the 
Republican package will save Americans $189 billion over the next 5 
years. That is $189 billion that all Americans would be able to share 
and spend and reinvest in America. The best thing about it is it is all 
paid for in the budget. We put a down payment on the savings when we 
passed the rescission bill. It is unfortunate the President vetoed it. 
We paid for the rest last week when we approved the Republican budget 
with the spending reductions.
  Of course, the Democrats will argue these spending reductions will 
affect only low-income Americans.
 Again, they are wrong. Our budget represents across the board spending 
reductions, reductions that would affect all Americans. It is just that 
those with their hands out, those who receive most for doing the least, 
will be affected more. This, Mr. Speaker, is simply a fact of life.

  It should be pointed out, though, that most of our savings were 
achieved through flexible freezes and not the elimination or reduction 
of very many programs. However, it is amazing. The Democrats portray 
the flexible freeze as a cut, despite the fact that spending actually 
continues to increase. It simply does not increase at the same budget-
busting rates as have been proposed here for 40 years.
  The best example of this paradox is the Medicare debate. Clearly and 
emphatically, the Republican tax cuts have nothing to do with slowing 
Medicare spending increase. Medicare is funded by a payroll tax that 
goes into a separate trust fund. That trust fund will go bankrupt in 
the year 2002. That is what the trustees of the Medicare trust fund who 
have told us. The fact of the matter is, the Democrats know this, but 
insist on misrepresenting the tax cuts to hide the fact that they do 
not have a balanced budget here in the House. Now the President of the 
United States has come out with a balanced budget.
  I see in several of the papers today that some of the Democrat 
leaders in the House here are upset that the President put forth a 
balanced budget program, even though it is over 10 years.
  Frankly, Mr. Speaker, what the Republicans have done is then infused 
the economy with $189 million, cut needless and duplicative programs, 
eliminated wasteful spending, and salvaged America's future.
  Now the only strategy left for the Democrats is to misrepresent what 
we have done. However, Mr. Speaker, for 40 years they have had the 
opportunity to run this country, so I ask everybody to ask this 
question: Are we better off now, or are we better off when they took 
power?
  Forty years ago there was no national debt to speak of, and Americans 
paid only 3 percent of their income to the Federal Government. Today we 
have a $5 trillion national debt and the average American family pays a 
full 25 percent of its income to the Federal Government. Taxes at all 
levels of Government now consume 40 percent of the average family's 
income, more than they spend on food, clothing, and shelter combined.
  Mr. Speaker, we have suffered through 40 years of tax increases and 
40 years of big government. Finally, Republicans have reversed a trend 
and set our country back on track. We have found a way to ensure a 
future for our children, we have found a way to let American taxpayers 
keep more of their own money, and we have found a way to remove the 
burden of bureaucratic spending from our government.
  Mr. Speaker, it is time for the loyal opposition to face the facts. 
They have left it up to the Republicans to balance the budget, to 
tackle the impending [[Page H6043]] Medicare insolvency, which is fine, 
because that is precisely what we intend to do for the sake of our 
children, our seniors, and the future of this great Nation.


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