[Congressional Record Volume 141, Number 135 (Friday, August 11, 1995)]
[Senate]
[Page S12426]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                        KEEP THE TAX CUT PROMISE

  Mr. ROTH. Mr. President, a major purpose of government is to provide 
an environment for economic growth--one in which jobs and opportunity 
bring security to our families and communities. History has shown us 
the blueprint for such an environment: low taxes. Treasury Secretary, 
Andrew Mellon slashed taxes 25 percent, ushering America into the 
roaring '20s. John Kennedy's tax cuts in the '60s created the longest 
peacetime economic expansion in history--that is up until President 
Reagan embraced Kemp-Roth in the 1980's.
  The result of Kemp-Roth, as my friend, Jack Kemp, recalls, was ``18 
million new jobs and more than 4 million new businesses, an 
entrepreneurial boom unmatched in the 20th century.''
  This is what history teaches. But as they say, that was then, and 
this is now. One after another, Americans have suffered tax increases--
each with the promise that it would eliminate the deficit. President 
Bush broke his pledge of ``no new taxes,'' cooperated in a budget 
summit, signed the largest tax increase in history at that time, and 
lost his reelection because of it.
  Then President Clinton, two years ago yesterday, signed his tax 
increase, which still earns the distinction as the largest in history. 
And now there is renewed talk of reneging on the $245 billion tax cut 
promised in the budget resolution that passed this spring.
  The irony, Mr. President, is that the tax cuts--whether they were the 
Mellon cuts, the Kennedy cuts, or Kemp-Roth--always produced windfalls 
for the Federal Treasury. As one well-respected economist pointed out, 
``the Federal Government received hundreds of billions more tax dollars 
annually during the Reagan administration than ever before.
  That is because the gross national product grew by nearly 80 percent 
over the 8 years when Ronald Reagan was President. Uncle Sam's cut was 
a slightly lower percentage, but the pie itself was much bigger. That 
was the whole point of supply-side economics. Then why is the national 
debt now at an all-time high, measured in trillions of dollars, instead 
of mere billions as before? Because Congress spent even more hundreds 
of billions than the massive new tax receipts pouring into Washington. 
Without spending restraints, no amount of new taxes will ever balance 
the budget.''
  And for those who believe cutting taxes only benefited the wealthy. 
Let the facts speak for themselves: In 1990, following Kemp-Roth, the 
wealthiest 5 percent of tax payers paid 43 percent of all taxes. In 
1981, before the tax cuts, the wealthiest 5 percent was paying 36.4 
percent.
  You see, Mr. President, there is nothing inconsistent with our 
objective to cut taxes and to balance the budget. Americans want a 
balanced budget. The United States has not had a balanced budget since 
1969. And Americans know that you cannot go year to year spending more 
than you take in.
  They cannot do it with their checkbooks. And they believe Congress 
should not be able to do it, either. In fact, they feel so strongly 
about this issue that virtually every poll showed 70 percent to 80 
percent of the country wanted the Balanced Budget Amendment approved 
and ratified by the States. Unfortunately, that was prevented from 
happening by roughly the same group of Senators who are now taking aim 
against our proposed $245 billion tax cut.
  These are--give or take a few--the same men and women who, 2 years 
ago, supported President Clinton in a historic tax increase. And where 
has that increase gotten us? The President said his increase would keep 
interest rates low. Today the prime rate is 2.75 percent higher than it 
was last year at this time. Treasury Bills, 30-year bonds and mortgage 
rates * * * they are all up. Beyond this, average wages and salaries 
for U.S. workers have fallen 2.3 percent from 1994 to 1995, the largest 
decline in 8 years, Fewer jobs are being created, economic growth has 
come to a standstill, and the dollar is down.
  This is where we are, Mr. President, and now the same people who 
brought you these statistics--the same people who voted against the 
American people on the balanced budget--are trying to kill a tax cut 
for the middle class--a tax cut that will offset President Clinton's 
record setting increase.
  The tax proposal they are trying to kill is positive and important 
for economic growth. Thirty-five million families, raising 52 million 
children, will pay lower taxes. Seventy-four percent of these families 
have incomes below $75,000.
  Families with children and incomes of less than $25,000 will pay no 
income tax at all. And the fact is, that 70 percent of all taxpayers 
who will benefit from the capital gains tax cut in our plan have 
incomes of less than $50,000.
  Mr. President, this is how we bring America back. And it should be a 
bipartisan effort. Mellon, Kennedy, Reagan--no one party has a monopoly 
on the key to economic growth. I believe we can work together. For this 
reason, I have been active in my efforts to restore the power of the 
individual retirement account.
  Toward this end, I have worked with former Senator Lloyd Bentsen and 
am now working with Senator John Breaux. In my efforts to reduce the 
threat of estate taxes on family-owned farms and businesses, Senator 
Pryor and others have joined with Senator Dole, me and Members on this 
side of the aisle.
  The magnitude and importance of the objective before us requires no 
less than our willing and cooperative effort. The American people 
deserve no less. They have paid too much in taxes. Promises to reduce 
the deficit have not been kept.
  Spending has continued to soar and government has grown overbearing 
and inefficient. We have proposed the first balanced budget in 26 
years. The $245 billion tax cuts are completely paid for. Let us now 
work together to see these initiatives passed. In the strong economies 
and Treasury windfalls that came about from tax cuts in years gone by, 
we see our future. And working together, I believe we can achieve it.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DOLE. I ask unanimous consent that further proceedings under the 
quorum call be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  

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