[Congressional Record Volume 142, Number 1 (Wednesday, January 3, 1996)]
[Extensions of Remarks]
[Pages E1-E2]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

[[Page E1]]


        CORPORATE LEADERS SHOULD CONTRIBUTE TO BUDGET SACRIFICE

                                 ______


                           HON. GEORGE MILLER

                             of california

                    in the house of representatives

                       Wednesday, January 3, 1996

  Mr. MILLER of California. Mr. Speaker, the budget discussions are 
about fundamentally important issues. For instance, nearly 50 
Democratic Members of the House who are prepared to make tough budget 
choices are asking corporate leaders, who have called for fiscal 
discipline, to declare the sacrifices they are prepared to make for 
deficit reduction.
  After all, we are talking about some of the richest people in the 
country, paid millions of dollars a year. And the Republican budget 
bill will make them richer still, thanks to reduction of the 
alternative minimum tax, lower capital gains taxes and extended tax 
loopholes. Some, like ASARCO and Chevron, stand to gain billions from 
royalty-free giveaways of public resources.
  Are they prepared to pay a fair share of corporate taxes, which are 
just one-third the level in 1954 despite a 14 fold increase in profits?
  Will they pay their employees wages and benefits that support a 
family, so that the taxpayers can stop subsidizing their corporations 
through welfare, food stamps, Medicaid and tax credits--all targeted 
for big cuts in the Republican budget?
  There is something unseemly about some of the richest people in 
America demanding a budget that preserves their perks and penalize the 
poor--many of whom they employ.

                                    Congress of the United States,


                                     House of Representatives,

                                Washington, DC, December 22, 1995.
       Dear Sir: We have seen the recent advertisement which you 
     signed with 90 other CEOs. I am glad to know that we share a 
     common goal of cutting federal budget deficits. You and the 
     other cosigners of the letter make it clear that as corporate 
     leaders you would like entitlements such as Medicare, 
     Medicaid and Food Stamps which affect the nation's poor and 
     elderly be put on the table. Believe us, those items are on 
     the table and are almost certain to take a major hit in any 
     likely resolution of the current impasse.
       While it appears you are willing to offer up substantial 
     sacrifice on the part of the nation's poor and elderly, it is 
     not clear what you are willing to put on the table. We would 
     like to know if Corporate America in general and your 
     corporation in particular are willing to play a role beyond 
     offering sacrifice on the part of others. These are some 
     questions which illustrate the possible contributions which 
     corporate America might consider.


                          Corporate Tax Burden

       During the 1950s Corporate America paid a much bigger share 
     of the cost of government. In 1954, corporate taxes accounted 
     for 30% of all federal revenues. Corporations will pay only 
     11% of the taxes collected by the federal government this 
     year despite the fact that corporate profits have increased 
     14 fold in the intervening years. If the same share of 
     profits were paid in taxes this year as in 1954, the federal 
     deficit would be eliminated in one year with no cuts required 
     in Medicare or any other program. Are you willing to accept a 
     larger share of the federal tax burden, a share more in line 
     with that which corporations bore in the 1950s (a period 
     remembered as a time of growth and prosperity for rich and 
     poor alike)?


           Accepting a Minimum Tax (Regardless of Loopholes)

       A central proposal in the House Republican budget is to 
     eliminate the Alternative Minimum Tax for corporations such 
     as yours. This would allow numerous large and profitable 
     corporations to exploit tax loopholes and pay no federal 
     taxes whatsoever. Would you commit your corporation to 
     continue to pay the current minimum tax level regardless of 
     the loopholes, deductions and exemptions that the Republicans 
     promise to enact?


                         worker health benefits

       A major cost to the Medicare and Medicaid programs is the 
     additional payments that they and other payers in the health 
     care system must make in order to cover the cost that 
     hospitals, clinics and physicians incur treating the more 
     than 30 million Americans who have no health benefits. Most 
     of these uninsured patients are either employed or are 
     dependents of Americans who have jobs but not health care 
     coverage. How many of your employees do not have full health 
     care coverage? Are you willing to extend coverage to those 
     employees so that the federal government, private individuals 
     and corporations don't have to continue picking up the tab?


                        payment of living wages

       Millions of Americans who have full time jobs, earn too 
     little money to support their families. As a result, many 
     workers qualify for Food Stamps, the Earned Income Tax Credit 
     and numerous other federal programs. How much do your lowest 
     paid workers make? How many of your workers are a drain on 
     the federal treasury because they are being paid less than 
     the amount required to feed, clothe and provide minimal 
     shelter to their family? What is the current multiple of the 
     salary and benefits received by your lowest paid workers and 
     that paid to you and your senior executives? How has that 
     multiple changed over time? If your company would return to 
     the multiple that it maintained during the 1950s, how much 
     would it allow lower rung wages to rise and how much would 
     that reduce the drain that your employees place on federal 
     programs?


              Paying your fair share to local governments

       The federal government has attempted to improve the quality 
     of local schools by making direct federal payments to local 
     school districts so that they can hire more qualified 
     teachers, reduce classroom size and toughen academic 
     requirements. Those efforts are now facing substantial 
     cutbacks as the result of various budget balancing proposals. 
     At the same time American corporations are forcing local 
     communities to bid against each other, offering up huge tax 
     concessions to persuade you to locate facilities in their 
     area. Many of those tax concessions come directly out of the 
     budgets of local school districts. Is your company willing to 
     cease such practices and is it further willing to pay the 
     appropriate level of taxes in communities where it is now 
     located without respect to earlier tax concessions made by 
     those communities? That would do a great deal to help build a 
     better trained and educated workforce that in the end would 
     be a real boon to corporate America. Further, it would help 
     offset the decline in federal funds that the schools are 
     likely to experience if this budget package is adopted.


                  helping employees be better parents

       The federal government provides grants to local communities 
     to provide child care simply because many employers refuse to 
     do so despite indications that on site day care improves 
     productivity, employee retention and loyalty. In addition, it 
     helps workers be better parents and that results in a better, 
     stronger society in which corporations can expect to be more 
     profitable. Would you be willing to reduce the need for 
     federal grants for daycare assistance by extending daycare 
     services to a larger share of your employees.


                Cease Budget Busting Lobbying Activities

       Many corporations hire lobbyists that actually encourage 
     the federal government to spend more--not less--money, 
     provided that the money will flow into corporate coffers. 
     This year for example corporate lobbyists succeeded in 
     persuading the Congress to spend $7 billion more at the 
     Department of Defense than the Department had requested. Much 
     of this went for new procurement of fancy new weapon systems 
     which the military had not asked for but which will produce 
     fat contracts and subcontracts for many of the Fortune 500. 
     It might help to balance the budget if Corporate executives 
     such as yourself made a commitment not to send lobbyists to 
     Washington to ask Congress to spend money that the Pentagon 
     and other portions of the Executive Branch are not asking 
     for. Would you make that commitment?


           A Fairer Distribution of the Individual Tax Burden

       Most senior executives in America's largest corporations 
     benefit from not only the highest salaries of corporate 
     leaders anywhere in the world, but stock option and benefit 
     packages which are worth in many instances millions of 
     dollars a year and have become increasingly generous in 
     recent years. The value of these packages has increased even 
     further as a result of the tremendous run up in stock 
     valuations in recent years. The stock of many companies can 
     attribute their spectacular growth to the wage concessions of 
     their employees. As Business Week pointed out this spring 
     ``the combination of high productivity and tepid wages 
     increases is pushing corporate profits through the roof'' and 
     as every investor or stock option beneficiary knows stock 
     prices move in direct multiples to profits. The Republican 
     budget includes a big cut in capital gains taxation which 
     makes the windfall for corporate leaders such as yourself 
     even greater. But there is another policy option. Since 
     events of the last decade have allowed you and your cosigners 
     to grow far richer than earlier generations of corporate 
     managers at the same time that the lot of most of your 
     countrymen has declined, you could offer to pay more tax 
     rather than less.
       You probably won't want to help out in all of the respects 
     listed above. But perhaps 

[[Page E2]]
     some of these items could be put on the table. Whether or not they are 
     adopted, it would at least make the elderly couple who has to 
     pay more of their Social Security check for Medicare coverage 
     or the working family that has had to assume the nursing home 
     costs of an elderly aunt feel that the decision that they 
     should sacrifice was not made before other possible options 
     were explored.
           Sincerely,
     George Miller.
     David R. Obey.
     Richard A. Gephardt.

       P.S.--Another option that you might consider in examining 
     what you might do to help with the budget deficit would be to 
     refrain from deducting from your corporate federal tax 
     payment the advertising cost associated with these ads. Some 
     taxpayers might feel that the advice you are providing on the 
     sacrifices that they might make should be paid entirely by 
     you rather than billing 35% of those costs to Uncle Sam.
                                                                    ____


Members of Congress Who Signed Letter to Corporate CEO's, December 22, 
                                  1995

       1. Hon. George Miller.
       2. Hon. David R. Obey.
       3. Hon. Richard A. Gephardt.
       4. Hon. Dick Durbin.
       5. Hon. Alcee Hastings.
       6. Hon. Rosa DeLauro.
       7. Hon. Joseph P. Kennedy.
       8. Hon. John Lewis.
       9. Hon. Cleo Fields.
       10. Hon. Melvin Watts.
       11. Hon. Bill Hefner.
       12. Hon. Nancy Pelosi.
       13. Hon. Patrick J. Kennedy.
       14. Hon. Albert Wynn.
       15. Hon. Major Owens.
       16. Hon. Sam Gejdenson.
       17. Hon. Maxine Waters.
       18. Hon. Ronald V. Dellums.
       19. Hon. Jesse Jackson, Jr.
       20. Hon. Tom Foglietta.
       21. Hon. Louise Slaughter.
       22. Hon. Ron Coleman.
       23. Hon. Chaka Fattah.
       24. Hon. John W. Olver.
       25. Hon. Karen L. Thurman.
       26. Hon. Cynthia McKinney.
       27. Hon. Eva M. Clayton.
       28. Hon. Pat Williams.
       29. Hon. Bobby Rush.
       30. Hon. Bill Richardson.
       31. Hon. Marcy Kaptur.
       32. Hon. Lynne C. Woolsey.
       33. Hon. Barney Frank.
       34. Hon. John Joseph Moakley.
       35. Hon. Patsy T. Mink.
       36. Hon. William L. Clay.
       37. Hon. Jim McDermott.
       38. Hon. Lane Evans.
       39. Hon. Pete Stark.
       40. Hon. Bernie Sanders.
       41. Hon. Donald M. Payne.
       42. Hon. Maurice Hinchey.
       43. Hon. Peter A. DeFazio.
       44. Hon. Patricia Schroeder.
       45. Hon. David Bonior.
       46. Hon. Neil Abercrombie.

                          ____________________