[Congressional Record Volume 142, Number 47 (Monday, April 15, 1996)]
[House]
[Pages H3249-H3256]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE CONSTITUTIONAL AMENDMENT TO REQUIRE A TWO-THIRDS MAJORITY VOTE TO
RAISE TAXES
The SPEAKER pro tempore. Under the Speaker's announced policy of May
12, 1995, the gentleman from Texas [Mr. Barton] is recognized for 60
minutes as the designee of the majority leader.
Mr. BARTON of Texas. Before I start my special order, I want to
commend the gentleman from Colorado and the gentleman from Virginia for
yielding time in this special order and once we give our opening
statements we will be happy to reciprocate in the spirit and to the
level that you did in your special order.
Mr. Speaker and members of the House, we are engaged in a serious
debate. It is serious business to determine you should amend the
Constitution of the United States. I would point out our Founding
Fathers allowed for such amendment, and it has been amended, I believe,
27, perhaps 28 times, since the original Constitution was ratified in
1787.
If you go back to that time period when our Founding Fathers were
debating the same issues that we are debating on the floor of the House
this afternoon, you find some interesting facts. First of all, there
was no such thing as an income tax anywhere in the world. There were
obviously taxes, but those taxes were normally head taxes, property
taxes, excise taxes, transaction taxes, duties, fees, tariffs, but
there was no income tax because very few people in the world, certainly
in the United States, had any income. We were an agrarian economy. Most
Americans lived on farms or in small communities and there simply was
not a resource there to be taxed. Even then, over 200 years ago, the
Founding Fathers were very aware of the sensitivity of the tax burden
on the American people. So while they did not require a super majority
vote to raise taxes, they did require that the House of
Representatives, which was the only body directly elected by the people
and the body most responsible to the people, be the body where all tax
bills originated.
For 125 years that limitation that all tax bills originate in the
House of Representatives worked very well. We did not have an explosion
in growth of the Federal Government. In 1913, we had the 16th amendment
to the Constitution of the United States that said specifically that an
income tax was constitutional. In 1913, 83 years ago, the first tax
form, the first 1040, was passed out in 1913. This is a photocopy, a
blown-up photocopy of the original 1040 form back in 1913.
Those of you that can read it, you find out some very startling
information. First of all, the normal tax, the normal tax that most
Americans who even had to pay an income tax paid, was 1 percent on net
income up to $20,000. Less than one tenth of 1 percent of the American
population had to pay that normal tax of 1 percent.
The richest American, an American who made over $500,000 in 1913, had
to pay 6 percent. But most Americans paid no income tax, or paid 1
percent.
By 1949, the year that I was born, the tax burden had grown to 5
percent on the American taxpayer, and today the average tax burden is
40 percent. The marginal tax rate on the average taxpayer in America
today is 40 percent. If you want to calculate percent increase from
1913, and 1 percent to 1996 and 39.8 percent or 40 percent, it is
4,000-percent increase 4,000 percent. That is too much.
The debate today is about making it more difficult to raise taxes on
the American people in the future. It is not about whether we had the
appropriate number of hearings in the Committee on the Judiciary. It is
not about the exact definition of de minimis in Webster's Dictionary,
it is all about the basic principle of making it more difficult to
raise taxes than it is under
[[Page H3250]]
the current simple majority tax increase vote requirement.
It is a very simple concept. Two-thirds as a fraction is a higher
number than one-half as a fraction. In fact, it is a higher number by
16 and two-thirds percent, one-sixth, 16.67. Translated into votes in
the House, you would go from 218 votes needed to 290 votes. In the
Senate you would go from 50 votes or 51 votes needed to 67 votes
needed. So that is what we are debating this evening.
There are some States that have tax limitations on their books today.
There are 10 States. These States range from the largest State in the
Union, the State of California, to the State where President Clinton
was Governor, the State of Arkansas. And you can see the other 8
States.
There are four things that are true in every State in the Union that
has tax limitation. The first thing that is true is that taxes go up
more slowly. In States that have some sort of supermajority requirement
for increasing taxes, taxes do not not go up. They do go up. In fact,
they have been going up, 102 percent between 1980 and 1992. In the
States that do not have a supermajority requirement, taxes have gone up
121 percent. That difference of 19 percent, if you calculated it on the
Federal tax rate, you would have lower taxes in the Federal Government
this year of around, I believe $160 billion.
{time} 1545
So the first thing in all 10 States is that taxes go up more slowly
than they do in States that do not have tax limitations.
The second thing we find out is that, since taxes are not going up as
fast in tax limitation States, spending is not going up as fast. Again,
between 1980 and 1992, in the supermajority tax increase States, their
spending went up about 132 percent. But in States that do not have a
supermajority requirement to raise taxes, their spending went up 141
percent. So that is a 9-percent savings in spending.
Mr. Speaker, if we calculate 9 percent of $1.6 trillion we are
spending here at the Federal Government this year, that is about $145
billion savings in spending.
Now, since taxes are not going up as rapidly and spending is not
going up as rapidly in those States, some good things begin to happen.
The first thing that happens is that employment does grow more rapidly.
In States that have a supermajority requirement, the average number of
people working went up about 26 percent. In States that do not have a
supermajority requirement, employment grew, but only 21 percent. So you
have a 5-percent differential there.
Last but not least, since there are more people working in States
with a supermajority requirement for a tax increase, the economy in
those States grew more rapidly, 43 percent versus 35 percent in the
nonsupermajority States.
So those four things are true in every State. Taxes do not go up as
rapidly, therefore spending does not go up as rapidly, therefore you
create more jobs, and you create more wealth in the State. So the way I
say this is a simplified fashion, taxes go up lower, taxes are lower,
therefore spending goes up slower in States that have the supermajority
requirement. And therefore the taxpayers are not left high and dry like
they are in States without the supermajority requirement.
Mr. Speaker, I am a lower, slower guy. I am not a higher, dryer guy.
The last thing I would say on these 10 States, not one State that has
passed supermajority has repealed it. In some of these States, the
supermajority requirement for a tax increase has been on the books for
decades.
With that, I would be happy to yield to my friend from Arizona for
such time as he may wish to consume.
Mr. SHADEGG. Mr. Speaker, I thank the gentleman from Texas and join
him in calling for the passage of this amendment.
Let me talk about why. On the list of States which my colleague put
up which have enacted a supermajority requirement, you will find the
first State is my home State, the State of Arizona. We enacted that
requirement in 1992. It compels the State legislature there to assemble
a two-thirds majority before yet once again raising taxes.
Now, why? The reason for that is that we had had a spiralling
increase in taxes in our State year after year after year, and the
consequences were devastating.
Mr. Speaker, I think the gentleman did a great job of showing exactly
how that comes about. I want to focus on just one of those charts.
This chart alone says it all. For my colleagues in the Congress, I
urge them to study this one chart. It says a very simple premise: Where
taxes are high, where they are raised time and again, over and over,
there is a consequence to be paid for that. In Arizona it was that we
had gone from a high growth State with low taxes and a booming economy
to years of tax increases, and we had become a low growth State. We had
injured our economy. So we put an issue on the ballot, an initiative
drive which I helped head, which the people had a chance to vote on. By
a margin of 72 percent of those voting, we enacted a supermajority tax
limitation.
Those words are kind of confusing, supermajority tax limitation. What
it says is simply this: Where today in this Congress we can raise taxes
with a simple majority, 50 percent plus one, we would change that
standard and make it not impossible but slightly more difficult to
raise taxes yet one more time.
Mr. Speaker, we are not cutting taxes, we are just saying that the
bar over which we should have to climb to raise taxes yet again ought
to be slightly higher.
In my lifetime we have raised taxes in this Nation, income taxes in
this Nation, on the average American family by 1,200 percent. The
consequence is we are doing to the national economy what the non-
supermajority States have done to themselves. That is, if you look at
States where it is slightly higher and slightly harder to raise taxes,
the supermajority States, you will see economic growth is significantly
higher than in those States where there is no supermajority and where,
accordingly, it is slightly easier to raise taxes.
The premise which this amendment raises is a straightforward issue of
fiscal responsibility. Should Congress be more responsible about
spending the hard-earned dollars earned by the citizens of this great
country? If you believe it should, then you must vote for this
amendment, because by making it slightly harder to raise taxes in
America, we will force this Congress to have discipline.
Indeed, Mr. Speaker, the record of this Congress and of past
Congresses on controlling spending is abysmal. We have failed time and
again to control spending. Thus, we need a supermajority requirement, a
discipline on our ability to raise taxes, because that will force us to
spend the money we have more wisely.
As the gentleman indicated, there are 10 states that now require
this. It is not a radical reform. I would like to point out that some
of those who have considered it view it as indeed a rather prudent
reform.
George Will recently writing said, ``The proper reverent reason for
amending the Constitution is to revive those of the framers' objectives
that have been attenuated by political developments since the framers
left Philadelphia.''
What indeed has happened in America is that we have lost many of the
first principles established in our U.S. Constitution. The U.S. Supreme
Court has as of today so expansively read the commerce clause that this
Congress has vastly more power than it did a decade or two or three
decades ago. Indeed, it has the power to reach into the pockets of
Americans time and time again, to spend that money on almost anything
it will.
Six times since 1980 we have raised taxes. On one of those occasions,
we had the two-thirds majority. On all of the others, we did not. Yet
we raised taxes over and over again.
The 1993 tax increase, the largest in American history, would not
have passed this body if one vote had switched. It would not have
passed the Senate had the vice president not broken a tie.
Let me conclude by pointing out the words of two scholars who have
looked at this issue. John McGuinness of the Yeshiva University's
Cardoza Law School and Michael Rappaport of the University of San Diego
Law School have said about this amendment that the amendment should be
seen as an attempt to revive the original values of
[[Page H3251]]
our Constitution, rather than as a radical innovation.
The opponents of this amendment will argue that it offends the notion
of majority rule; that whenever the majority wants to do something,
they ought to be able to do that. Regrettably, they ignore that the
first premise of a constitution is to protect the rights of a minority.
Indeed, in this instance, it is critically important that in the area
of taxation, we protect the rights of the minority. That is why a
constitutional amendment is the proper device. It is indeed not a
radical innovation, but rather an idea that will restore the Founders'
intent.
I would invite the other gentleman to join us here.
Mr. BARTON of Texas. I want to compliment the gentleman from Arizona
on his leadership. He is one of the named sponsors, and is doing an
outstanding job.
I would like to yield to the gentleman from Arkansas [Mr. Hutchinson]
at this point in time.
Mr. HUTCHINSON. I thank the gentleman for yielding time and
compliment Mr. Barton from Texas for his leadership on the balanced
budget amendment and on this constitutional amendment we will be
debating and voting on today.
As Americans hasten to file their Federal income tax returns by
midnight tonight, many families will again remember how much of their
family budget is paid to the Federal Government every year. Today they
will be reminded and we will be reminded that the average American
family pays $1 out of every $4 it earns to the Federal Government. We
will be reminded that the average American family spends more on taxes
than on food, on clothing, and on shelter combined.
Sadly, we will also be reminded that the average American family can
expect to work at least until May 6 before being able to dedicate any
of the earnings to anything other than Federal, State, and local taxes.
The average worker today spends the first 3 hours when he gets to work
each morning just paying his debt to the Federal Government, State
government, and local government before he can ever begin to labor for
himself or for his family.
With approximately 38 percent of the average family's budget being
used to meet their total tax burden, it is high time that the U.S.
Congress take action to make further tax increases more difficult.
Our country has run chronic budget deficits for 25 years. We have
pretended that we were going to do deficit reduction by raising taxes
in the omnibus budget laws described as deficit reduction acts, and yet
spending continues more and more.
A perfect example for the necessity of such an amendment can be found
in the middle class tax cut that was the centerpiece of President
Clinton's 1992 campaign for President. Despite his record in Arkansas
of having raised taxes and fees 128 times during his tenure as Governor
of my home State of Arkansas, the American people still trusted him to
make good on his promise. Just 1 month into his Presidency, however,
the President betrayed that trust and traded his promise of a middle
class tax cut for the largest tax increase in history. This record tax
increase was pushed through Congress in 1993 and was approved by a 51-
to-50 vote in the Senate and a 218-to-216 vote in the House. A single
vote switch in either body would have killed the legislation. A
supermajority requirement easily would have saved our economy from yet
another oppressive tax increase.
It is clear that increasing taxes is not the answer to our deficit
problems, that increasing taxes is not the way we are going to deal
with the growth of the national debt. Every time in the last 40 years
this Congress has raised taxes $2, we have increased spending $3.
Raising taxes is not the answer. We simply must make it more difficult
for this Congress and future Congresses to raise taxes.
If that was not enough, our President vetoed the middle class tax cut
that this Congress passed and gave to him this past December 6. That is
why there will be no tax cut this April for hard working families.
In one stroke of the pen, the President denied tax cut benefits to 28
million families and 59 million children in our $500 per child tax
credit. We will not see capital gains tax relief, we will not see the
job creation that would have accompanied it, the relief from the
marriage penalty, the estate tax, and on and on. We would have done
that and much, much more. But, instead, the temptation is going to be
there in the future for Congress to start raising taxes again. That is
the temptation, to try to solve deficits by raising taxes, and is
simply will not work.
It is time to make Washington start working for families, instead of
making families work for Washington. That is why I rise in strong
support of this supermajority rule as a necessary component strategy,
to shrink the size and power of the Federal Government and limit the
power of Congress to tax the American people.
Mr. BARTON of Texas. Before I recognize another gentleman, I would
like to ask the gentleman a question: My understanding is you do
represent the great State of Arkansas.
Mr. HUTCHINSON. That is correct.
Mr. BARTON of Texas. It is my understanding that Arkansas has had a
tax limitation on amendment on the books for several decades. It
requires a three-fourths vote; not a two-thirds, but even a higher
standard of three-fourths. Could you comment on how that has worked in
Arkansas?
Mr. HUTCHINSON. We have a supermajority requirement, a three-fourths
requirement, to raise the income tax in Arkansas. The evidence is very
clear that the legislature has been more reluctant to raise the income
tax levels for hard-working Arkansans.
Now, we have a lower threshold for raising the sales tax, which many
believe is a more regressive tax. The fact is they have fallen back
many times on that regressive sales tax, which hurts poor people more
than affluent individuals. I believe the supermajority across the
board, whether it was a two-thirds or three-fourths, would make a lot
more sense. But Arkansas today has one of the lower tax levels and one
of the lower tax burdens in the United States. That is why people are
moving to Arkansas. That is why our economy is good in Arkansas.
{time} 1600
In my particular district, we have got unemployment down around 3
percent, virtually full employment in my district, companies moving in,
people doing well, because the tax burden, heavy as it is on the
Federal level, has not been that onerous on the State level, partly
because of that super majority provision.
Mr. BARTON of Texas. Is there any move in Arkansas to repeal the
three-fourths requirement?
Mr. HUTCHINSON. None whatsoever. I think the American people would
rise up in arms, the people of Arkansas would rise up in arms if that
were to occur. Quite to the contrary, as is happening in the antitax
movement across this country, there are initiatives efforts, there is
lots of talk about actually putting on the ballot a requirement to put
all tax increases to a vote of the people. I do not necessarily support
that. What I am saying is there is certainly no sentiment at all to
repeal our supermajority tax issue.
Mr. BARTON of Texas. The tax limitation works, the supermajority vote
for tax increases works in Arkansas.
Mr. HUTCHINSON. It worked in Arkansas. It worked when President
Clinton, then governor of Arkansas. I certainly believe it will work
for our country.
Mr. BARTON of Texas. I thank the gentleman from Arkansas.
I would like to yield to the gentleman from Kentucky [Mr. Lewis].
Mr. LEWIS of Kentucky. Mr. Speaker, I rise today in support of the
two-thirds tax limitation amendment to the Constitution. Mr. Speaker, a
typical family of four pays nearly 40 percent of its income in Federal,
State and local taxes. When you consider sales and a variety of other
taxes that a family is often paying nearly half of their hard-earned
money in taxes. Is there any wonder why so many folks are struggling to
make ends meet? We have learned over the past four decades that too
many politicians would rather raise taxes than reduce spending or even
the growth of spending. Incidentally, that is not just true in
Washington.
[[Page H3252]]
An article published in Kentucky papers across the State this weekend
showed my home State of Kentucky, that the taxes there are a burden on
the lower income people more heavily than any State in the Nation. That
is according to the Center on Budget and Policy Priorities. We can make
a statement on this tax day in the House of Representatives.
We can tell the folks back home that they matter more than big
Government, that Congress can make the occasional tough spending
decisions without asking hard working men and women to contribute more.
Mr. Speaker, 3 months ago, President Clinton ripped out a page from
the Republican playbook by saying the era of big Government is over. We
can help him keep his word today by passing House Joint Resolution 159.
It is a good start toward ensuring the era of big Government will truly
be over.
Over the past three decades, there have been 16 major votes to
increase taxes. Just half of those would have become law if there has
been a two-thirds requirement. We may not be able to stop President
Clinton from vetoing our tax cuts for working families, but we can help
make sure that a one-vote margin in the House or the Senate does not
allow another massive tax increase like the 1993 Clinton tax hike.
Mr. Speaker, let us tell the American people that enough taxes are
enough.
Mr. BARTON of Texas. I thank the gentleman from Kentucky.
I yield to the gentleman, Mr. Hall of Texas, one of the named
sponsors, the distinguished gentleman from Rockwall, the fourth
district of Texas.
Mr. HALL of Texas. Mr. Speaker, today, of course, is tax day for
millions of Americans. It is also tax day for Congress. I think what we
do in the next few hours will send a message to all the hard-working
Americans all across the country. It will either give Americans some
hope for the future, some hope for tax relief, or it will give them
nothing but the status quo.
In the next few hours, we will have an opportunity to vote in support
of House Joint Resolution 159, the tax limitation amendment to the
Constitution. This amendment would require a two-thirds, a
supermajority vote in the House and Senate for any bill that would
raise Federal taxes. If a two-thirds requirement had been in place over
the past 15 years, major tax increases in the years 1982, 1984, 1987,
1990, and 1993 would have failed. It does not mean we would not have
had a tax bill, but it would have been a more sensible tax bill. It
would have been sent back and reworked and we would have had more cuts
in spending and less taxes on the backs of the American people.
This is a much higher standard than a simple majority vote and a
standard that would be far more representative of the wishes of the
American people.
Most of us here in Congress, like most Americans, support efforts to
balance the Federal budget, and last year Members of the House went on
record to pass a balanced budget amendment to the Constitution. Now
today we have another opportunity to show where we stand on an issue
that will affect everyone in this country.
Most of us, like most Americans, most of us Members of Congress
believe that taxes are either too high or they are high enough, and
today we have an opportunity to vote on a bill that would offer some
protection to the American taxpayer by making it more difficult to
raise Federal taxes. Hopefully the balanced budget amendment will pass
the Senate this year and go all the way to the statehouse and to the
States for ratification. Following ratification of the amendment,
Congress would be obligated to produce balanced budgets.
Now if the vote falls short, which some people predict that it might
do and we have to know that anything can happen on the floor of this
house, if we do not have enough contact from the people of America to
those who stand on this floor and represent them here as their Member
of Congress, it is possible that we will not pass this day, this time
this bill. But I think we will accept the lessons of history and
consider this another step in the right direction. If I know the
gentleman from Texas, Mr. Barton, and the gentleman from Texas, Mr.
Pete Geren, and the gentleman from Arizona, Mr. Shadegg, as well as I
know them, they will be back again and again. It took 13 years for the
balanced budget amendment and the line item veto, but it is here and
this will follow.
Mr. Speaker, I believe that we can pass it this day. I think if
history is any indication and if we listen to the people, that is
exactly what we ought to do. So on this historic day, Mr. Speaker, I am
pleased to be an original cosponsor of the tax limitation amendment,
along with Mr. Barton, Mr. Shadegg, and Mr. Pete Geren. They have
worked tirelessly. I do not know of anyone who has worked harder than
those men and their staffs throughout this legislation. The grassroots
response have been enormous.
On this historic tax day, I think Americans are watching to see where
Congress stands on this important issue. I think we need to show the
American people that we stand with them. I urge my colleagues to join
me in support of House Joint Resolution 1759, the tax limitation
amendment.
Mr. Speaker, I thank the gentleman.
Mr. BARTON of Texas. I thank the distinguished gentleman from Texas.
Before I yield to the gentleman from Texas, Mr. Pete Geren, I yield to
the chairman of the Committee on Economic and Educational
Opportunities, the distinguished gentleman from Pennsylvania, Mr.
Goodling.
Mr. GOODLING. Mr. Speaker, I can sum up the most important reason to
pass this legislation in one illustration. Thirty-eight percent of what
the average American family earns they pay in taxes. Anybody have any
idea how much they spend on food, clothing and shelter combined?
Twenty-eight percent, which is 10 percent less than they have to spend
on taxes.
I was having a meeting this morning and the one gentleman said, I had
to pay my taxes today. He has two little children. He said, very, very
difficult. I said, yes, because the President vetoed a package that
would have given you the kind of relief you would have needed. It would
have given you $500 for each child. It would have given you a $500
credit for home care. It would have given you a $1,000 credit toward
long-term insurance. It would have given you an IRA for the parent that
stays at home.
These are the kinds of things we should be doing to try to help
American families stay together, not take their money and bring it to
Washington, DC, to waste. So I would call on all of my colleagues,
support this legislation. We get a balanced budget and we make sure
that we stop spending more than we take in and we will give hope to the
future. We will give hope to the children and the grandchildren that
are out there now wondering whether there will be a tomorrow like we
were fortunate enough to have.
I thank the gentleman for yielding me this time.
Mr. BARTON of Texas. I thank the gentleman, Mr. Goodling, for those
remarks. Would the chair indicate how much time is remaining in our
special order?
The SPEAKER pro tempore. The gentleman has 28 minutes remaining.
Mr. BARTON of Texas. I yield to another of our original sponsors, Mr.
Pete Geren of the 12th District of Texas, who unfortunately will be
leaving us at the end of this Congress to return home to Fort Worth.
Mr. PETE GEREN of Texas. I want to thank the gentleman, Mr. Barton,
and commend him, the leadership on this issue, the leadership that he
has brought to bear.
From the first day he stepped on the floor of the Congress, he has
been pushing this, and his dogged determination has brought us to where
we are today. I must say it has been with some reluctance that I have
come to the conclusion that it is necessary that we pass this
resolution that would amend the Constitution to require a supermajority
vote of two-thirds in order to increase tax revenues. However, I
believe that if we ever are to control the growth of Government, limit
its insatiable ambitions, then this limitation is necessary.
The growth of Government, and with it the increase in taxes and
increase in the deficit, have become a constant in this country.
Regardless of who is in the White House, regardless of what party
controls Congress, Government has remained and will continue to remain
a growth industry. In terms of 1983 dollars, from 1969 to much of 1996,
[[Page H3253]]
the size of Government measured in terms of its spending, it has nearly
doubled. These are in constant dollars. The Government has grown from
$593 billion in 1969 to $1.1 trillion in 1996.
I commend President Clinton for his statement that the era of big
Government is over. I wish that were true. In spite of those words, the
size of Government continues to grow and according to all projections,
to all projections, it will grow as far as the eye can see and younger
generations will bear the brunt and cost of our mushrooming growth in
taxes paid and in freedom lost.
According to the General Accounting Office, a child born in 1992, to
fund Government on its current growth path, a child born in 1992 will
pay 82 percent of his or her future earnings in taxes. Eighty-two
percent of his or her future earnings in taxes. The Government itself
has become the most powerful political force in America, not the people
that pay the bills but the people that live off of those who pay the
bills.
When faced with cuts in spending, Government programs are able to
rally their individual constituencies to bring overwhelming pressure to
bear on the legislative process. The tax limitation amendment is needed
to offset this pressure. I do not think our Founders ever imagined that
we would have a Federal Government that would be telling us where to
place curb cuts in the step of Cleburne or a Federal Government that is
spending over 20 percent of the gross national product.
They could not have imagined that when they drafted our Constitution,
and I am confident if they had, this limitation amendment would have
been put in the original Constitution. This is not a new initiative. It
is a tested initiative. It has been tested in the laboratories of our
individual States, as our Founders intended.
Currently 10 States have supermajority requirements to raise taxes.
They include Arkansas, Arizona, California, Colorado, Delaware,
Florida, Louisiana, Mississippi, Oklahoma, and South Dakota,
geographically spread across the entire Nation. In States with no tax
limitation, taxes have climbed 120 percent per capita from 1980 to
1992, while they increased only 102 percent in States with
supermajority requirements. Even with the supermajority requirement,
the government has found a way to grow. Supermajority States have
enjoyed a 43-percent growth rate from 1980 to 1992, while other States
without this limitation have grown by only 35 percent. Employment
growth averaged 26 percent in supermajority States but only 21 percent
in States without the supermajority requirement. Using data from 50
States, Dr. Richard Vedder, in a study for the Joint Economic
Committee, has concluded and I quote:
The economic performance of States is negatively relative
to the overall amount of taxation: Higher taxes mean lower
growth, lower taxes mean higher growth.
This amendment is not artful. It is not pretty. It is not the sort of
provision that will ever thrill constitutional scholars. It is a blunt
instrument, and it is unfortunate that it is necessary, but it is
necessary. As legislators, we have either been unwilling or unable to
put restraints on the growth of government.
In the so-called antitax era that we have all lived through in the
last 15 years, we have still seen Government grow. The 1980's were
famously antigovernment, antitax, yet taxes grew 20 percent during that
decade, the size of Government growing in excess of that. There is a
bias in our system toward growing Government. It is a bias that grows
stronger every day as Government grows more and more and more intrusive
in our lives. This amendment is necessary to counteract this bias and
force the Government back into a role that respects that the genius and
miracle of our experiment in democracy lies not in Washington, DC, but
with the people.
Mr. Speaker, I thank the gentleman, Mr. Barton, for yielding me this
time, and I commend you for your leadership on this effort.
Mr. BARTON of Texas. Well, if the gentleman would remain at the
podium, I have got a few questions that I would like to ask.
My first question is, I believe that you are a member of the
Democratic Party, is that not correct?
Mr. PETE GEREN of Texas. Certainly am.
Mr. BARTON of Texas. I know that some Members of this body have said
that this is some sort of a Republican policy gimmick. But you are not
a Republican, obviously. I think you are very proud to be a Democrat.
Mr. PETE GEREN of Texas. No, and I expect that we will have a
considerable number of Democrats join us in voting for this. I think
the experience that we have seen in the 10 States that have tried this
belies the accusation that this is some partisan gimmick by either
party. Arkansas, a State that has been controlled by Democrats.
Legislature, the Governor's office, I guess since Reconstruction, they
have this provision.
{time} 1615
California, very strong Democratic legislature, they have had
Republican and Democratic Governors; they have this limitation under
Willy Brown, one of the leading Democrats in the entire country. This
provision came out of the legislature in which he presided as the
speaker.
So anybody that tries to dismiss this as a partisan gimmick I think
is ignoring the fact that 10 States, some of the States in heavily
Democratic--with heavily Democratic majorities in every area of
government--have this problem. So for those to try to dismiss it with
that sort of criticism I think are ignoring the reality of experience
with this provision.
Mr. BARTON of Texas. I am sure that you have seen this study, but you
might not have had a chance to really study it in detail, but March 19
through March 21 there was a national poll conducted by Americans for
Tax Reform. They polled 1,205 registered voters throughout the country
about the tax limitation amendment, and I know that you will find this
very gratifying to know that of those poll respondents that identified,
self-identified, themselves as Democrats, 64 percent said they
supported the two-thirds tax limitation amendment; 80 percent of people
that identified themselves as Independents and 80 percent that
identified themselves as Republican. So the support is slightly higher
for Republicans and Independents, but for Democrats around the country
64 percent of the respondents in this 1,200-person poll that said they
were Democrats said they supported the amendment.
And I know as a Democrat you will also be delighted to know that when
they asked the poll respondents to identify themselves by socioeconomic
status, low, middle class, or high income, of those that identified
themselves as low-income wage earners, 80 percent supported two-thirds
vote for tax limitation; middle income, self-identified, 77 percent
supported tax limitation; and high income, 64 percent. And finally,
certainly last but not least, when asked the one political question in
this survey, and again these are 1,200 people, March 19 through 21,
national poll, plus or minus 2.8 percent variance--when asked would you
be more likely or less likely to vote for your Member of Congress if
you knew that they voted for the two-thirds tax limitation amendment,
by party identification 76--no, 68 percent of self-identified
Democrats, said that they would be more likely to vote for their Member
of Congress if they knew that he or she had voted for the two-thirds
tax limitation constitutional amendment.
Does the gentleman from Texas have any comments on those poll
numbers?
Mr. PETE GEREN of Texas. Well, I think that this reflects accurately
where Americans are, regardless of party affiliation, and also explains
why in many States with a strong, strong Democratic tradition and
control of their State governments, have enacted a provision of this
sort.
This is a bipartisan initiative. We are not going to have as many
people on my side of the aisle supporting it as I would like to see,
but I think that poll shows that this is an initiative that enjoys
bipartisan support or nonpartisan support, including strong support in
the Independent base, and I would expect that--I mean, you look at the
States that have it, Florida all the way to California, Louisiana,
Arkansas; these are States that have very different economies, they
have different political traditions, but joined in a recognition and
understanding of the need to check this bias in favor of growing
government.
[[Page H3254]]
Mr. BARTON of Texas. Well, I think it is interesting that when you
really look at the facts and you look at the data that is out there,
every State that has it, it works. We pointed out, you pointed out, the
gentleman from Texas [Mr. Hall] pointed out, that taxes are lower, they
grow slower, and that the economy, therefore, grows faster and more
jobs are created. We point out that regardless of what your party
affiliation is, it is supported anywhere from 80 to 64 percent.
Regardless of your socioeconomic status, low, middle, or high, it is
supported.
More States are adding this tax limitation provision to their State
constitutions every year. Voters of Nevada have already passed it once.
Their constitution requires two separate votes. they are going to vote
on it again this fall. We think they will ratify it and they will be
the eleventh State to put it in the constitution.
There are some dozen, dozen and a half, States that have got
initiatives underway, so we are simply doing what is already being done
and continuing to be done in the States, and I think that with your
support and the support of the gentleman from Texas [Mr. Hall] we have
an excellent chance to get enough Democrat support to pass it by two-
thirds on the floor this evening.
Mr. PETE GEREN of Texas. Let me just highlight one point that you
made, the economic growth.
If anyone were seeking to find an explanation why 68 percent of
Democrats across the country support this, it is one simple word. It is
jobs, economic growth. You look through the history of Democratic
platforms, and you will see the word ``jobs'' repeated over and over
and over for the last 100 years, and the States that have tried this
have been proven job creators.
This is an initiative that will create jobs, as it has in California,
as it has in Arkansas. This is an opportunity to extend that job
creation across the 50 States of this country.
Mr. BARTON of Texas. Be happy to yield to the gentleman from Texas
[Mr. Hall] and then----
Mr. HALL of Texas. I think also, Mr. Speaker, that it might be
pointed out: I think that same poll that was conducted indicated not
just people that are out of work or that are looking for work,
Democrats or Republicans, support this. I think that same poll showed
that among Federal employees who already have a job, that 68 percent of
those supported the supermajority, and I think it also should be
pointed out that union members, who historically have voted Democratic,
have indicated that 71 percent of the union members polled supported
the supermajority.
So while we up here on the floor of Congress try to shoot an arrow
that hits the taxpayer and misses the voter, let me tell you we are
hitting both of them and this is a chance for the voters and the
taxpayers to have a shield, and I think the gentleman from Fort Worth
probably agrees with that.
Mr. PETE GEREN of Texas. Absolutely.
Mr. BARTON of Texas. I thank both my two good friends for supporting
this.
I would like to continue some of the comments that I made earlier.
This is about making it more difficult to raise taxes, but not making
it impossible. When my good friend from Arizona gets back, we are going
to go through a colloquy on some of the tax increases that have passed
the House in the last 10 to 15 years.
One very good thing about our amendment: It would take bipartisan
support to pass any additional tax increases because it is very
unlikely that either political party is going to have 67 percent of the
House and the Senate at the same time in the modern era, and as has
been pointed out numerous times during the debate this afternoon, the
last major tax increase that we had 2\1/2\ years ago passed by two
votes in the House, with no Republican voting for it, and by a tie
breaker vote the Vice President, Mr. Gore, voting for it in the Senate.
That is not bipartisanship, that is one political party with a very
slim majority forcing a massive tax increase, in this case the largest
tax increase in American history, down the throats of the American
people.
I would now like to engage in a colloquy with the gentleman from
Arizona about some of the more recent major tax increases that have
been before the House and the Senate.
Mr. SHADEGG. I would just like to commend the gentleman from Texas,
actually all three gentleman from Texas, Mr. Barton, Mr. Pete Geren,
and Mr. Hall, who have shown great leadership here. I think I heard Mr.
Hall recite that whether we passed it today or not, if in the unlikely
chance we do not pass this measure today, he had great confidence that
we would be here carrying this fight forward in the future, and, for
the reasons that Mr. Pete Geren pointed out, I indeed, so long as I am
a Member of this body, until we are successful in this effort, will be
here to fight for it precisely for the reason he pointed out, and it is
the reason shown on the chart just to your side, and that is job
creation.
This measure will aid the American economy. It is wonderful that we
have 10 States to look to which have had experience with a
supermajority for tax increases; that is, with making it slightly
harder to raise our taxes again. And that experience teaches us; it
teaches us that the economy and those States where they have made it a
little harder to raise taxes, as we propose to do here today for the
Nation, have grown at a significantly faster pace, over 40 percent
versus under 30 percent.
Now, in the discussion beforehand, and the gentleman might recall
that our colleague from Virginia, Mr. Moran exercised some great
concern about whether or not it would be possible to ever muster the
two-thirds majority that this measure would require for a tax increase.
Well, the history shows that while it may indeed be and should be
somewhat more difficult, our goal is not here today to make it
impossible to raise taxes, and I would just like to point out that on
at least four recent occasions more than a two-thirds majority has been
mustered for a tax increase, both here in the House and also in the
Senate.
The Tax Adjustment Act of 1966 got 74 percent of the Members of the
House in its support and 94 percent of the Members of the Senate. The
Interest Equalization Tax Extension Act of 1967 got 73 percent of the
Members of the House to support it and a similar number in the Senate.
In 1989 the Senate passed by a vote of 93 percent of the Members and
the House passed by a vote of 58 percent of the members the Omnibus
Budget Reconciliation Act of 1989. But the most compelling example of
where a supermajority was accorded is what is now the infamous or
famous Tax Reform Act of 1986. That probably is one of the best known
tax revisions in this Nation's history, and that measure in its final
version passed this Congress in 1986 by a vote of 292 to 136 in the
House and by a vote of 74 to 23 in the Senate.
So for those who say that a two-thirds barrier is too high, is too
extreme, I would call these examples to their attention, and I would
simply like to reiterate. The gentleman was asked before, the average
American family today spends more on taxes, according to the figures we
have been provided, than on food, clothing and shelter combined. When
we have reached the point in this Nation where we spend more on taxes
as an individual family than on food, clothing and shelter combined,
indeed I believe it is time for reform, and the reform we bring here is
not a radical one. It is a logical one, not a rightful cut in taxes,
but simply a provision that says the next time we try to raise taxes
again we ought to have to do it with a two-thirds rather than a 50
percent majority.
Mr. BARTON of Texas. My understanding is the gentleman speaking is
from the great State of Arizona and that you have a two-thirds or
three-fourths requirement for all tax increases in your State and that
has been in effect since 1992.
Is that correct?
Mr. SHADEGG. We do indeed have a two-thirds majority for all tax
increases.
Mr. BARTON of Texas. And how has this worked in Arizona the 3 years
it has been on the books?
Mr. SHADEGG. Well, as having been the chairman of the initiative
drive who put it on the ballot and then pushed it over with the vote of
72 percent of the legislature supporting it, it has worked extremely
well. Where we had seen a spate of 9 successive tax increases in a row,
we have not seen a general tax increase since that measure was enacted.
[[Page H3255]]
I would point out that the measure enacted in Arizona is much like
the one we are proposing here; that is, it allows revenue neutral tax
reform, so that if we want to change the code in some respect we can,
so long as it is not a tax increase. And whenever in Arizona a tax
increase is required, that is when the supermajority, two-thirds, is
triggered, just as the language we are proposing here today would do.
Mr. BARTON of Texas. I think that is a very basic point that we need
to emphasize as often as possible. Under the language that is going to
be voted on this evening, we could change from a national income tax,
graduated system that we have today, to the flat tax or the national
sales tax, as some people propose, with a majority vote so long as the
revenue impact was de minimis, was neutral or less.
{time} 1630
Mr. SHADEGG. Mr. Speaker, our goal is to allow and to continue to go
forward with revenue-neutral tax reform. Should we shift from the
income tax to a sales tax to a VAT tax, whatever we deem is necessary,
provided it is revenue-neutral, it can be accomplished with a simple
majority. That provides the flexibility that our colleagues on the
opposite side of the aisle are so deeply concerned about.
Mr. BARTON of Texas. Mr. Speaker, I think one of the other concerns
under the current tax code, most Republicans and far-thinking Democrats
support a rate reduction in the capital gains tax. What is the
gentleman's understanding of what we could do with capital gains, if
our amendment were to become part of the Constitution?
Mr. SHADEGG. Mr. Speaker, as the scoring by CBO is currently
performed, we could easily enact a capital gains tax cut, and would not
require a supermajority to do that. Some of us, though, would argue
that CBO ought to embrace the concept of dynamic scoring, which might
change that analysis.
But as the measure would currently be scored, a change in our capital
gains tax rates to lower those tax rates could be accomplished by a
simple majority vote, which means that a lot of arguments we have heard
already today and a lot of arguments we will hear tonight about how the
rule adopted here on the House has had to be waived simply does not
have any application to this debate, because the language of the
amendment differs from the language of the rule which we adopted on the
first day of this Congress.
Mr. BARTON of Texas. Mr. Speaker, I see the distinguished chairman of
the Committee on Rules, the gentleman from the great State of New York
[Mr. Solomon], on the floor. Would he like to engage in the debate?
Mr. SOLOMON. Mr. Speaker, will the gentleman yield?
Mr. BARTON of Texas. I yield to the gentleman from New York.
Mr. SOLOMON. I would. Mr. Speaker, I thank both of the gentlemen. I
happen to come from the State--that State is New York--which always is
either the first or second highest-taxed State in the Nation. Let me
tell you, we have seen hundreds of thousands of manufacturing jobs
leave our State almost for that reason alone; that, plus the fact that
we are the most overregulated State.
Let me just tell you, we go back to 1993 when this Congress enacted
the largest tax increase in the history of this entire Government body,
the largest tax increase. Yet, we did not cut the deficit by the amount
of the tax increase. That meant by increasing taxes, you actually are
giving an incentive to this Congress to increase spending. That is why
we should never, never increase taxes in order to bring down the
deficit, because it just does not work.
This in itself is going to do more to straighten out the fiscal mess
of this Congress and this Government than anything else we could do,
because it is going to be a disincentive to this body to spend money.
That is what we need to get at this sea of red ink that is literally
killing my children, my grandchildren, and yours, and the others around
this country.
I commend both of you. Let us get this thing on the floor and let us
pass it, and the American people are going to thank us from the bottom
of their hearts.
Mr. SHADEGG. Mr. Speaker, if the gentleman will continue to yield,
the gentleman raised the question of whether or not tax increases have
solved the deficit problem.
I am sure the gentleman is aware that the history is, as he points
out, the opposite. Each time we have increased taxes by a dollar,
studies show we have further increased spending by not $1, not an equal
amount, but by $1.59. So we have driven ourselves with each new tax
increase to solve our deficit problem, not taken ourselves out of debt,
but put ourselves further into debt.
Mr. SOLOMON. The gentleman is so right. Again, I want to thank both
of you for the job that you have done to get this on the floor.
Sometime around 9 o'clock tonight is going to come the critical vote. I
would urge all of you, to the people back in your districts, to get
those phones ringing and let us get these Members of Congress to come
over here and vote for this vital piece of legislation.
Mr. BARTON of Texas. Mr. Speaker, that phone number is 202-225-3121,
for those who wish to call the House switchboard.
Mr. HALL of Texas. Mr. Speaker, will the gentleman yield?
Mr. BARTON of Texas. I yield to the gentleman from Texas.
Mr. HALL of Texas. Mr. Speaker, I would say to the gentleman from
Texas [Mr. Barton], the leader and the original sponsor of this
amendment, that we need to reduce this down to its easiest terms to
understand. It is not tough. It is really simple. It is just, simply,
do you want half the Members on this floor to be able to raise your
taxes, or do you want it to require two-thirds. We have de minimis and
all these other one-way roads and explanations and diversions and
questionings, and we will have speeches about it later in the day, but
it narrows right down to whether or not we want half the people to be
able to put taxes on us to where they can have more spending, or we
want it to require two-thirds.
The gentleman from New York [Mr. Solomon] and I were here when they
passed the so-called Tax Reform Act of 1986. It was an act that he
simply wanted, the President, President Reagan wanted an act. He wanted
a Tax Reform Act. The Committee on Ways and Means chairman wanted a Tax
Reform Act. They got together on a Tax Reform Act. We passed it. I
think of the two, only one of them really understood it. I am sorry to
say that was not President Reagan.
We got the sorriest act that has ever been passed on the floor of
this Congress, that set this country back so far. That would not have
happened if your amendment, I would say if the gentleman from Arizona
[Mr. Shadegg] had been here, and the gentleman from Texas [Mr. Barton],
if his amendment had been passed, that would not have taken place. It
took place right at the break of day when people were trying to go
home. This protects people against those of us who are trying to go
home; stay here and work, and require a two-thirds majority. I thank
the gentleman for his tenacity and the tenacity he will set forth in
the future if we fail today.
Mr. BARTON of Texas. Mr. Speaker, I yield to the gentleman from
Arizona.
Mr. SHADEGG. Mr. Speaker, I thank the gentleman for his leadership. I
simply want to conclude my remarks as a part of this special order by
saying we in the Congress have a tremendous opportunity today to
deliver to the American people on a promise we made a year ago. On this
day when we exact their tax return from them, when we reach into their
pockets one more time, we have a chance to tell them that we are going
to impose the discipline of a supermajority requirement in the U.S.
Constitution. I urge my colleagues not to miss this opportunity to
support this amendment.
Mr. BARTON of Texas. Mr. Speaker, I want to conclude very quickly by
stating that this is about helping us to get to a balanced budget. The
last balanced budget of the U.S. Government was in 1969. My son was
born in 1970. He is now about to enter graduate school. He has never
lived in a year that we have balanced the Federal budget.
There are two ways to balance the budget. You can cut spending or
raise taxes. We think, those of us who support this amendment, we
should do it by emphasizing spending cuts, not tax increases. Federal
revenues have grown every year since 1964. The 10 years that
[[Page H3256]]
I have been in the Congress, they have grown an average of $59 billion
a year, $59 billion a year. The problem is that spending has grown more
rapidly than revenues.
The tax limitation amendment is simply a mechanism to make it more
difficult to raise taxes and, therefore, easier to focus on spending
reduction or spending limitation, which is what we should do in order
to balance the budget. This House and this Senate sent to the President
of the United States a 7-year comprehensive budget that would have
balanced in 7 years with no tax increases. The President vetoed the
Balanced Budget bill we sent him. If we get a supermajority requirement
into our Constitution, future Congresses will be able to work with
future Presidents and focus on spending limitation, not on tax
increases, as a way to balance the budget.
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