Congressional Record, Volume 143 Issue 111 (Thursday, July 31, 1997)

[Congressional Record Volume 143, Number 111 (Thursday, July 31, 1997)]
[House]
[Pages H6623-H6662]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

CONFERENCE REPORT ON H.R. 2014, TAXPAYER RELIEF ACT OF 1997

Mr. DREIER, from the Committee on Rules, submitted a privileged
report (Rept. No. 105-221) on the resolution (H. Res. 206) waiving
points of order against the conference report to accompany the bill
(H.R. 2014) to provide for reconciliation pursuant to subsections
(b)(2) and (d) of section 105 of the concurrent resolution on the
budget for fiscal year 1998, which was referred to the House Calendar
and ordered printed.
Mr. DREIER. Mr. Speaker, by direction of the Committee on Rules, I
call up House Resolution 206 and ask for its immediate consideration.
The Clerk read the resolution, as follows:

H. Res. 206

Resolved, That upon adoption of this resolution it shall be
in order to consider the conference report to accompany the
bill (H.R. 2014) to provide for reconciliation pursuant to
subsections (b)(2) and (d) of section 105 of the concurrent
resolution on the budget for fiscal year 1998. All points of
order against the conference report and against its
consideration are waived. The conference report shall be
considered as read. The conference report shall be debatable
for two and one half hours equally divided and controlled by
the chairman and ranking minority member of the Committee on
Ways and Means.

Mr. DREIER. Mr. Speaker, for purposes of debate only, I yield the
customary 30 minutes to the gentleman from Texas [Mr. Frost]. All time
yielded is for the purpose of debate only. Mr. Speaker, I yield myself
such time as I may consume.
(Mr. DREIER asked and was given permission to revise and extend his
remarks and to include extraneous material.)
Mr. DREIER. Mr. Speaker, if I were to address the American people, I
would say, Today, you can finally believe that you will get a tax cut.
We will pass it. The President will sign it. You can take this tax cut
to the bank.
This rule provides for consideration of the conference report on H.R.
2014, the long-awaited Archer tax cut bill. The rule waives all points
of order against the conference report to accompany H.R. 2014 and
against its consideration. The rule provides that the conference report
be considered as read. The rule also provides for 2\1/2\ hours of
debate equally divided and controlled between the chairman and ranking
minority member of the Committee on Ways and Means.
Mr. Speaker, I want to point out at the beginning that a balanced
budget, even with this tax relief, will not solve all of our Nation's
problems. However, the Archer bill is a major victory for American
workers who pay the taxation that run the Government.
The American family has not seen tax relief from their excessive
Federal tax burden since 1981. Taxes eat up too much of the average
family budget. I am honored to represent many working families who,
unfortunately, pay more in taxes then they spend on food, clothing, and
housing combined. Hard working people who save for retirement or
struggle to build a small business or family farm see Federal taxes eat
up far too much of their savings and investments. The Archer bill will
help to address those problems.
Last November, the American people gave Congress and the President a
mandate to balance the Federal budget, provide tax relief for working
families, create incentives for private sector job creation, preserve
the Medicare program, and promote quality educational opportunities for
all children.
Let us face it, Mr. Speaker, many Americans did not believe that we
would deliver. Commitments from elected officials mean little or
nothing to those disillusioned by broken promises of big government and
high taxes.
A Washington Post columnist, David Broder, once described the
President's trust deficit with the American people as even more
damaging than the budget deficit. Congress is helping to eliminate
both.
In November of 1994, American voters made Republicans the majority in
Congress for the first time in four decades. They wanted a change, and
the new Congress vowed to succeed where previous Congresses had failed.
That change in leadership sent us down the path that we are on today.
Mr. Speaker, the Republican majority believed that keeping promises
was as important a goal as balancing the budget, cutting taxes and
reducing the size and scope of the overly intrusive Federal Government.
Now, there is no doubt that this zeal did not always adapt well to the
political realities of divided government. The American people have
watched Washington's rocky moments with some understandable
frustration, but they have also witnessed some momentous
accomplishments, and from my perspective, the Archer tax relief
legislation is at the top of that list.
As the sponsor of the bipartisan, job creating and investment
encouraging capital gains tax relief bill, which I join with my
colleague, the gentlewoman from Kansas City, MO [Ms. McCarthy] and
other Democrats and Republicans, we put together the largest number of
cosponsors, I want to thank the gentleman from Texas [Mr. Archer], the
chairman, for the tremendous work that he did in the face of the
outdated class warfare rhetoric that came from some of our colleagues
on the other side of the aisle. Reducing the job killing, investment
stifling capital gains tax is the single best way to promote wage
growth, spur real economic growth, and ensure that we will balance the
budget by the year 2002. I applaud the effort of our negotiators
because they share the commitment to raise the wages of American
workers and ensure that strong growth balances the budget.
At the end of the day, when the dust clears, we must look back over
the past 3 years with some amazement and

[[Page H6624]]

pride. We have enacted a balanced budget, cut taxes on families and job
creators, reformed welfare, controlled illegal immigration, saved
Medicare, and made private sector health insurance more available and
affordable.
Combine the achievement of those bedrock Republican Party goals with
the expansion of free trade through the North American Free Trade
Agreement and the GATT Uruguay Round of the General Agreement on
Tariffs and Trade in the 103d Congress and the election and historic
reelection of the Republican Congress, and we can make the case that
President Clinton has compiled one of the most impressive Republican
legacies of any President in this century.
Mr. Speaker, the Republican-led Congress has put policy ahead of
blind partisanship. I congratulate the President for working with us to
make Government a more cost-effective vehicle, for improving the
standard of living of the American people.
Mr. Speaker, I reserve the balance of my time.
Mr. FROST. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, at the end of the day, when this tax package is taken
apart, it will be apparent that House Democrats, who have throughout
this debate insisted on fairness, have been successful. What started
out as a bill cutting taxes solely for the benefit of the wealthiest
among us, while denying any sort of tax relief to those who really need
it the most, has been modified to meet the fairness test.
My Republican colleagues have for months insisted that working
families who make less than $30,000 a year do not pay taxes and should
not get a tax break. But House Democrats have stood fast and insisted
that young families with children, those families just starting out in
life who are trying to make ends meet, perhaps pay a mortgage, take the
kids to McDonald's and maybe see a movie every once in a while need a
tax break also.
Why, we wondered, should a family making $29,000 a year be denied tax
credits? Who says they do not pay taxes? Not the Democratic Members of
the House, that is for certain. We know that everyone that works pays
taxes. We all pay income tax, but we also pay Social Security and
Medicare taxes, State income taxes, and unemployment taxes. Those taxes
count every bit as much for the family making $29,000 a year as they do
for a family making twice or three times as much. Maybe they count even
more.
And so, in the end, Mr. Speaker, Democrats have prevailed in our
position. This bill will provide the tax credit for every family with
children under the age of 17 who make $18,000 or more a year. That is
what Democrats stood for, and that is what Democrats achieved.
Democrats have stood firm in our insistence that education be a top
priority in this bill and we joined with the President in insisting
that the HOPE scholarship program be instituted to make the first 2
years of college as universally available as a high school diploma is
today.
We need more opportunities for our young people to advance their
education, and Democrats insisted that this package provide a way for
everyone to continue education. And this package does that. We have
components of this package which will go a long way toward ensuring
that our work force in the 21st century is productive and globally
competitive.
Democrats stand for things like penalty-free IRA withdrawals for
undergraduate, post-secondary vocational, and graduate education
expenses. Democrats stand for tuition tax credits for juniors, seniors,
undergraduate students, and for working Americans who are seeking to
enhance or upgrade their skills. Democrats stand for things like
education savings accounts and for extending the exclusion of employer-
provided undergraduate educational benefits.
Mr. Speaker, since those things are in this tax bill, Democrats
achieved what they stand for. Mr. Speaker, the fact that this tax bill
provides for families and for those Americans who want to pursue an
education make this bill much more palatable to Democrats. But I should
point out that in spite of the infusion of fairness in this package,
our Republican colleagues have managed to ensure that the upper end of
the income scale has been taken care of.

{time} 1045

I wonder how many of us really understand that the child tax credit
is available in some form for couples with adjusted gross incomes up to
$150,000 a year. Democrats are, of course, in the minority in the House
and we cannot win on every point, but I do find it interesting that a
party that was so willing to deny this tax credit to families making
less than $30,000 a year is now so willing to extend it to families
making five times that much.
However, Mr. Speaker, that we are in a position to be able to discuss
a balanced budget and tax cuts simultaneously is because 4 years ago,
this House, or should I say the Democrats in this House, passed a
deficit reduction package that has now produced an economy that is so
healthy and so productive that our deficit has fallen by 75 percent
since 1993. When the House passed that package, Mr. Speaker, it was
done without a single Republican vote. It was done, Mr. Speaker, while
the current Republican leaders lamented loudly that it would send the
economy straight down the tubes.
Yes, as my Republican colleagues are so fond of pointing out, that
deficit reduction package did contain some tax increases, but I would
like to remind my colleagues that those increases were aimed primarily
at the upper end of the economic scale, at those people who are doing
so well today that the stock market has soared in value, so much so
that it has increased in value by 50 percent in the past 2 years.
That deficit reduction package which the Republicans opposed
unanimously set the stage for the action of the Congress this week.
That package created an economy which this year has the lowest
unemployment rate in 24 years and has created 12.5 million new jobs. I
voted for that package in 1993, just as I voted for the spending cuts
on Wednesday. I voted to bring Federal spending under control and to
balance the Federal budget for future generations.
Mr. Speaker, my Republican colleagues now crow and claim credit for
balancing the budget, but more importantly, Democrats can claim credit
for ensuring that the proposals of the Republican majority are tempered
and made much more fair for working men and women, their children, our
seniors and for our vulnerable groups in society. Democrats stand for
fairness and equity as do the American people. I think we won on these
basic points in this debate.
Mr. Speaker, I reserve the balance of my time.
Mr. DREIER. Mr. Speaker, I was very privileged to come to the
Congress in 1981 and vote for the Economic Recovery Tax Act of Ronald
Reagan. I did so along with my very dear friend from Glens Falls, NY,
the distinguished chairman of the Committee on Rules.
Mr. Speaker, I yield such time as he may consume to the gentleman
from New York [Mr. Solomon].
Mr. SOLOMON. Mr. Speaker, I thank very much the gentleman from
California, the vice chairman of the Committee on Rules, for yielding
me this time.
Yes, Mr. Speaker, the gentleman from California [Mr. Dreier] is
right. I had been here for a couple of years before he and Ronald
Reagan arrived. With the gentleman and Ronald Reagan and the gentleman
from Texas [Mr. Archer] in the back here, and the rest of us
Republicans, we began to change the philosophy of this Government, we
began to cut taxes, meaningful tax cuts and shrink the size and the
power of the Federal Government to go along with it; and yes, Ronald
Reagan's legacy lives on and is being carried out today.
Mr. Speaker, I hope the former President, one of the greatest
Presidents this country has ever known, is able to watch part of this
debate today because it is devoted to him.
Yes, back in 1981, President Reagan signed into law the historic 25
percent across-the-board tax cut for all working Americans, a package
that liberated our economy and our Nation from the fiscal straitjacket
of stagflation, and the rising unemployment of the 1970's. President
Reagan's foresight paved the way for the longest peacetime economic
expansion in our Nation's history, that created 17 million new jobs, an
increase in real average

[[Page H6625]]

family income from the richest to the poorest income groups and a
steady and sustained growth in real GDP and productivity throughout the
entire 1980's. This was one of the most successful decades of the
history of this great country of ours.
Today, 16 years later, the Republican Congress and President Clinton,
stand on the threshold of delivering America's working families and
America's businesses a long-awaited second installment of that tax cut,
an installment that Ronald Reagan tried for years to get after the
initial tax cut in 1981 but was deprived of by the Democrats in this
House.
In 1994, when the American people gave Republicans control of the
people's House, we promised to cut taxes. Today Republicans deliver on
that promise. Yesterday we delivered on the promise of a balanced
budget. Today on tax cuts. It makes me proud to be a Republican today.
Both are real, both are consistent and both, Mr. Speaker, are
sustainable.
Four years ago this same Congress under a Democrat majority passed
the largest tax increase in American history. Today the Republican
Congress will roll back our Nation's tax burden by at least $95
billion. And you have not seen nothing yet. Wait until next year and
the year after, because we are going to come back to eliminate capital
gains taxes and we are going to further cut taxes off the American
people.
Mr. Speaker, this permanent tax relief takes many forms and will
assist many sectors of our economy. A sharp cut in the capital gains
tax cut will, without question, stimulate job growth, and investment,
and the real incomes of all working American families.
According to the Congressional Budget Office, and this is so terribly
important because it goes back to this business of class warfare.
According to the Congressional Budget Office, three-quarters of
America's families own assets such as stocks, bonds, homes, real estate
and businesses. NASDAQ reports that 47 percent of all investors are
women. The Treasury Department, and this is perhaps the most important
of all, the Treasury Department reports that nearly two-thirds of all
tax returns reporting capital gains income are filed by people whose
incomes are under $50,000. Fifty percent of two-thirds of all of these
people are senior citizens living on fixed incomes with a few returns
of the stocks and bonds from their investments. Clearly these figures
show that a capital gains tax cut benefits middle-class American
families and older Americans.
In addition, family-owned small businesses and family farms are
provided further relief through cuts in the estate tax. Educational and
retirement opportunities are enhanced. And, Mr. Speaker, middle-class
parents are allowed to keep more of their income to take care of their
families with child tax credits. How terribly important that is to the
average American in this country.
Mr. Speaker, contrary to what we are going to hear from the other
side of the aisle, the majority of this tax relief, more than 72
percent of it, will go to middle-income wage earners, families making
between $20,000 and $70,000 a year. This will better enable all
American families to care for their children, to improve their
communities, and represents a good first step in rolling back the high
level of Government interference which has grown out of all proportion
over the last 20 to 30 years.
Mr. Speaker, while this tax cut may represent a major victory for the
Republican Party and the American people, it is also the product of
bipartisanship. In the same spirit, let me repeat a quote I stated
yesterday. In introducing his tax cut plan to the American people in
1962, President John F. Kennedy, a Democrat, and I was a John F.
Kennedy Democrat back in those days, stated that, quote, ``prosperity
is the real way to balance the budget. By lowering tax rates, by
increasing jobs and incomes, we can expand tax revenues and finally
bring our budget into balance.''
President Kennedy was right then and this bill before us today is
right now. Over the past 16 years, this Congress has raised our
Nation's taxes over five times and by hundreds of billions of dollars,
taking money out of the pockets of the American people. Today we
reverse that trend and we pass the first tax cut in 16 years and make
good on another promise to the American people. Yes, Republicans.
Promises made, promises kept. Come over here and vote for this great
bill and let us keep this economy moving.
Mr. FROST. Mr. Speaker, I yield 5 minutes to the gentlewoman from
Texas [Ms. Jackson Lee].
Ms. JACKSON-LEE of Texas. Mr. Speaker, it gives me a great deal of
pleasure to come and simply add to setting the record straight and
clearly speaking to those who least of all have an ability to come to
this House and lobby for their causes.
Let me say, Mr. Speaker, that any legislation that is passed in this
body does nothing unless it gets to those who are at home and on the
front line. Democrats are known for confronting the hard issues and
working to get legislation that practically addresses those who every
day are turning the engine of this Nation, to ensure that those who are
running the engine of this Nation by working every day are
appropriately protected and defended.
That is why I can rise with maybe a troubled heart but a sure mind
that we are making the right decision today and I am making the right
decision today to vote not only for this rule but for this tax
agreement. It allows me to thank those who were around the negotiating
table but it has also allowed me to thank those who finally listened to
my constant agitation and advocation for ensuring that those who did
make under $30,000 a year were treated as American citizens and
respected for what they have given to this Nation, by giving them tax
relief.
This agreement cuts Federal taxes $95.2 billion over 5 years, nearly
$10 billion more than the House-passed bill. Why did that happen?
Because it was the Democratic caucus that forced that increase so that
tax cuts could come to those lower-income families who earn the earned
income tax credit. They too can get a child tax credit. This effort
stands and represents those who are least vocal and most vulnerable. It
gradually raises the amount exempt from Federal estate taxes to $1
million, and it makes IRA's more widely available, so to encourage
Americans to save.
What does that say? Mr. Speaker, what that says is to the many small
businesses around this Nation who have cropped up over the last 20
years, who pay their taxes, who work either in their homes or small
offices, who employ only one or two persons or maybe a little bit more,
it says that Democrats understand that small businesses have become the
business of America.
Then we go to the HOPE scholarships, something that was confused
under the Republican plan, did not respect those who might be moving
from welfare to work, looking for opportunities at less expensive
community colleges or junior colleges or 4-year colleges. We give the
HOPE scholarship with no strings attached. You can get 100 percent of
$1,000 the first year. You can get your foot in the door. We did not
hear from large businesses and advocates of large tax cuts on this
issue. However, Democrats realize that education is the great
equalizer, so along with President Clinton we fought for this change.
To my family farmers, let me say we heard your voices. I am from an
urban district, however most of my constituents have come in from the
rural areas and their families are still harvesting the crop on small
family farms. How gratified I am to be able to give them a $1.3 million
unified tax credit, something that will start not 7 years down, not the
year 2000-and-something, but January 1, 1998.
Democrats, realizing who drives this Nation, fought hard in
conference and before in strategies on the floor of this House to say
that we must stand up for working people, the most vulnerable on
welfare, and family farmers and small businesses. Yet I have supported
tax incentives to help large businesses invest in job creation.
And then we understand that there are some of us that can save a few
more pennies. We can save a few more pennies, those of us who do that,
by a deduction of up to $2,500 on interest for qualified student loans.
Mr. Speaker, I realize that we cannot come to this floor and abdicate
our responsibilities, and so I say to Members

[[Page H6626]]

that I am going to be a diligent student of this tax plan. I am going
to be watching whether there is a potential of exploding the deficit in
the outyears and be at the fight to correct and fix what may damage the
most vulnerable of this Nation.

{time} 1100

Nevertheless, at the same time I am going to be able to go to my
community and get to working on cleaning up inner-city areas because we
have got a 3-year brownfield tax incentive that allows economically
distressed areas to clean up environmentally damaged areas.
And yes, this tax bill follows an amendment that I made as a freshman
in this House to give tax incentives to employers who hire welfare
recipients. We are going to do that now because Democrats recognize
that we want to boost up the opportunity for those moving from welfare
to work.
This is a bill that needs to be supported, it needs to be watched, it
needs to be monitored, the Tax Code must be simplified, and we need to
stand ready to fix anything that hurts Americans as this bill moves
forward to drive the economic engine of this Nation in order to create
more jobs for all Americans.
Mr. DREIER. Mr. Speaker, I yield myself such time as I may consume.
What a fascinating debate. The American people know that the words
``tax cutting'' and ``Democrat'' heretofore would clearly be an
oxymoron. It is wonderful now to hear the great statements emerging
from the other side of the aisle. I have to say that one of the
fighters for meaningful tax reduction is my very good friend from
Guilford County, NC.
Mr. Speaker, I yield 2 minutes to the gentleman from Greensboro, NC
[Mr. Coble].
Mr. COBLE. Mr. Speaker, I thank the gentleman from California for
yielding this time to me.
How far down this road we have advanced. Now a balanced budget is
within our grasp. The White House, Republicans, Democrats are all
taking credit for it, and that is fine. But these tax reductions, Mr.
Speaker, would not be before us were it not for a Republican Congress,
and if there are those who do not believe this, see me after work and I
will sell you a used bridge. Capital gains tax reduction, educational
tax benefits, estate tax exemption threshold increased.
I could recall just a few recent years ago when some of our Democrat
friends were daring to lower the threshold of the estate taxes from
$600,000 down to $200,000. That sent a shock wave throughout America,
throughout rural America particularly, and now family farms and
residents and estates will now be exempt from that heavy hand of the
death tax. It has been a long time coming, but it is here.
These matters, Mr. Speaker, constitute the Republican agenda.
Everyone knows that unless they have been residing in a cave. The
President has embraced our agenda and, some say, is receiving more
credit for it than are the Republicans. That is OK. It has been said,
``Anything can be accomplished if you don't care who gets the credit
for it.''
This is a day, Mr. Speaker, when empowerment is being returned to
hard-working Americans, and that is where it belongs. I commend
everybody who had a hand in it, Democrats, Republicans alike, but most
particularly I say to the gentleman from Texas [Mr. Archer], chairman
of the Committee on Ways and Means, Well done.
Mr. FROST. Mr. Speaker, I yield 4 minutes to the gentleman from Ohio
[Mr. Traficant].
(Mr. TRAFICANT asked and was given permission to revise and extend
his remarks.)
Mr. TRAFICANT. Mr. Speaker, when the President first took office, he
invited 5 groups of 13, 65 total, to the Cabinet room. I was in the
last group. He told us that he caught that Greyhound and it is
different than what he thought it was and he was going to have to raise
taxes. I was later told by the Vice President that 64 of the Members
there said they agreed with him and they would support him. They said I
was the only one that disagreed with him and told him not only would I
not support a Btu tax, I would work to defeat a Btu tax.
I also reminded the President when he campaigned in my district, the
biggest crowd he ever had in his political life, he made a promise to
cut taxes. Not only was he not going to cut taxes, he was going to have
the biggest tax increase in our history, and he also said, ``Don't
worry about it, we're also going to hit the rich.''
I told the President then that I thought that type of strategy and
politics was very bad, ``We've already chased jobs, Mr. President,''
exactly what I told him, ``in factories overseas. Be careful you don't
chase our money overseas.''
Vice President come to me, he said, ``I can't believe, Jim, you take
this position.''
I said, ``It's very simple, Mr. Vice President. I come from a poor
family. My dad never worked for a poor guy.''
This politics of class warfare is very bad. I disagreed with it then,
I disagreed with it throughout this whole debate, and I want to now
commend the Democrats for taking a look at the facts, and I want to
give credit to the Republican Party. The Republicans have kept the
President's feet to the fire on the campaign promise to cut taxes for
people in America. That is the truth of it.
I support tax cuts. I supported them all along. I knew that some of
those provisions would be removed, but I am a Democrat, and Democrats
were the very first to cut taxes with JFK, and by God, as a party, how
did we give the Republicans the patent on it in the first place?
But I want to say this, I hope this bill is the end of this class
warfare. We, they; they, we; rich, poor; old, young; politics of
division, politics of fear, politics that are bad for America, politics
that are wrong for America, politics that are dangerous for America.
I voted for this tax bill all the way through, I am going to vote for
it today, and I want to close with commending now Democrat leaders who
have taken out some of the provisions that I did not like either, but
the Republican Party kept the President's feet to the fire. That is the
bottom line, and I think it is good for our country.
Our Government is working.
Mr. DREIER. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I thank my friend from Youngstown, OH [Mr. Traficant]
for telling it like it is.
Mr. Speaker, I yield 3 minutes to the gentleman from Florida [Mr.
Goss], distinguished chairman of the House Permanent Select Committee
on Intelligence and chairman of the Subcommittee on Legislative and
Budget Process.
(Mr. GOSS asked and was given permission to revise and extend his
remarks.)
Mr. GOSS. Mr. Speaker, I thank my friend from downtown San Dimas, CA
Mr. Dreier, vice chairman of the Committee on Rules and chairman of the
Subcommittee on Rules and Organization of the House. I commend him for
his very hard work to eliminate the punitive and the self-defeating
taxation on capital gains, and I know he feels there is a great step
forward here today and even more to do down the road.
Two years ago a new Republican-led majority pledged to balance the
budget, to save Medicare, and provide overdue tax relief to the
American people. Republican after Republican and some Democrats joined
us here in the well and said we would do those things, and we are doing
them. The naysayers and the big spenders said it cannot be done, cannot
be done, country cannot afford it, we have to keep raising taxes. Well,
my colleagues, they were wrong. Here we are today to prove it.
Today on this House floor we are going to complete the pledge that we
made by providing Americans with the first relief from taxation in 16
years, almost a generation. The good news is there is something in this
package for just about everyone in America, across the land, in all
different pursuits and in all different situations.
For families trying to pay bills, that is most of us, we have
provided a $500 per child tax credit. That is $500 more that you can
use for things like school clothes or taking the kids for a summer
vacation, some have not been able to do that, or anything else that
they choose to do, because the bottom line here is that the people are
going to decide what they are going to do with their money, not the
folks here in Washington who may have a different idea about how to
spend it.

[[Page H6627]]

For senior citizens about to embark on their retirement, and many of
those come to Florida and my district, we have cut the capital gains
tax so they can sell some assets without Washington confiscating,
``confiscating'' is the word I choose, nearly one-third of the gain.
But most importantly, as we look to the future of our children, we
have made it easier for young Americans to get a college education, and
I see lots of young Americans around this building this time of year.
Our package is going to allow Americans to withdraw tax free from new
super IRA's to pay for college education expenses. This commonsense
provision was part of our Contract With America, many will remember,
and I am pleased that these new American dream savings accounts are
soon going to be an option for all Americans.
We have also created the HOPE scholarship, which will provide $5,000
in credits for individuals who wish to go to college or get a graduate
degree.
Mr. Speaker, these are the right kind of incentives, and I hope that
Americans will take advantage of them, and I know they will take
advantage of them because I talk to Americans every day who are looking
for these things.
As my friend from California [Mr. Dreier] knows, though, we are far
from done. We need to come back next year to zero out the capital gains
tax and eliminate the marriage penalty as well, send the right
incentive about our family values. We need to repeal the Clinton tax
hike on Social Security benefits, particularly of doctors. This is such
an onerous benefit on senior citizens who are on fixed income, and I
have again a great many in southwest Florida, where I represent, have
the honor to represent, and these folks get taxed who cannot afford to
pay the tax. They are on fixed income, they are beyond their earning
years, what do they do? This is a tax that needs to be repealed. We
have not got it done here today. It is a target for tomorrow. The
Clinton administration was wrong on that tax, and they should help us
in that effort to repeal it. But most of all, we need to have
comprehensive reform to simplify and flatten our convoluted,
incomprehensible, and unfair Tax Code, and that lies ahead for us to do
as well.
I know that when I return to my district in southwest Florida and
other colleagues return to their districts around the country we can
now look constituents in the eye after we pass this bill and say
``Look, next year Uncle Sam's tax bite isn't going to be quite as bad
because we're listening to you and doing the job you asked us to do.''
I think we are going to be able to let them know that more of their
money and decision making is going to stay with them, their own
individual responsibility, and I think that is a great trend and a
great sign for America. That is what we are great at doing so well
together, is making the decisions.
I urge support of this rule and the very important tax cuts that it
makes in order.
Mr. FROST. Mr. Speaker, I yield 3 minutes to the gentleman from
Oregon [Mr. DeFazio].
Mr. DeFAZIO. Mr. Speaker, I thank the gentleman for yielding this
time to me.
Mr. Speaker, here we are today on the last day of this session of the
Congress before the big recess engaged in the big lie, the big lie.
This is a balanced budget agreement. Well, after we voted yesterday,
the Congressional Budget Office came up with an analysis, and the
analysis is, guess what? Deficits have gone down for the last 5 years,
but next year for the first time in 5 years they will go up and we will
double the deficit by 1999.
The American people know we cannot give away huge tax breaks,
increase spending, and balance the budget. Congress did this once
before in the early 1980's, and guess what. Three years later they came
back and they had to repeal substantial portions of what they did.
This bill today will reduce revenues to the Federal Government by
$275 billion over 10 years, and it is going to balance the budget. This
is great. We are going to have zero tax on capital gains, the
Republicans tell us now by next year, and that will balance the budget.
We will not tax capital gains, but all those little people who work for
wages will pay taxes, and that is how we will balance the budget.
What an absurd and very, very cynical assertion on their side of the
aisle. Listen to a few things in here:
Simplify foreign tax credit limitation for dividends from 1,050
companies to provide look-throughs starting in 2003. Now all the
middle-class Americans out there looking for that foreign deduction for
the look-through starting in 2003, that is a billion dollar gift. Well,
I am sure that a lot of my constituents, average working Americans, are
looking forward to that.
Then we have the capital gains provisions, $21 billion, and now they
say they want to repeal the tax.
Had a young woman in my office yesterday. She wants to become a
neurosurgeon. We talked a little bit. She said, ``What does this
mean?''
I said, ``It means if you become a neurosurgeon, you earn $250,000 a
year, you'll pay 40 percent of your income in taxes. But the rich kid
who went to college with you who has not worked a day in his or her
life who then just invests for a living will pay taxes at half that
rate.
She was outraged. She said, ``How can that be fair?''
Well, they are saying it is not fair, the rich kid who inherits the
money tax free should pay zero income tax his or her entire life; that
is the Republican position. That is absurd.
Then we have the alternative minimum tax. It was so embarrassing in
the 1980's when the largest, most profitable corporations in America
not only did not pay taxes, they got tax refunds paid for by the rest
of us for taxes they did not pay, that Ronald Reagan supported putting
in place an alternative minimum tax for corporations. They are
repealing that here today. That will cost $20 billion, a nice gift to
the large corporations. Oh, that is for middle-income America.

{time} 1115

That is for middle-income America. Sure it is, Mr. Speaker.
Then we have the subtotal here for gift and generation-skipping tax
provisions, which they call estate tax relief, $35 billion. So the sum
total here today is $275 billion in tax rates; crumbs for the middle
class, and just wonderful bounty for the wealthiest in America.
Mr. DREIER. Mr. Speaker, I am happy to yield 3 minutes to the
gentlewoman from Columbus, OH [Ms. Pryce], the hardworking Secretary of
the Republican Conference and a member of the Committee on Rules.
Ms. PRYCE OF Ohio. Mr. Speaker, I thank the hardworking gentleman
from California [Mr. Dreier], who has fought so hard over the last
several years for tax fairness, for yielding me this time.
Mr. Speaker, I rise in strong support of the rule for the Taxpayer
Relief Act. Just as history shows tax increases hamper economic growth,
it will also show that the proper path to creating new jobs in growth
is by lowering taxes. That is what we are about to do today with this
historic conference report. We are going to put America back on track
to growth and prosperity.
For years Republicans have wanted individuals and families to control
their own economic destinies. We fought for changes in the Tax Code to
allow them to keep more of their hard-earned dollars, and we have
pushed for commonsense changes to encourage savings and investment.
Today, Mr. Speaker, I am absolutely elated that we are taking another
historic step, indeed, a giant leap in fact, toward a new era of growth
and opportunity that will touch the lives of all of those who still
believe in the American dream.
This conference agreement is a balanced plan to unite our country
behind a new economic strategy that will expand opportunities for so
many Americans. I implore my colleagues who might oppose this
bipartisan effort to put away the tired refrains of class warfare. As
my Democratic colleague, the gentleman from Youngstown, OH [Mr.
Traficant], earlier so rightly stated, this is not good for America, it
is not right for America, and it is actually very, very dangerous for
America.
It is time to recognize that an economic system that allows
individuals and families to create opportunities for themselves and
their communities is infinitely more preferable than government
barriers to entrepreneurship and innovation.

[[Page H6628]]

Mr. Speaker, it is hard to find someone this Taxpayer Relief Act does
not help. To ease the financial burden on families with children, this
plan includes a $500-per-child tax credit. There is capital gains
relief. There is estate tax or death tax relief, as it should be
called. There is an equally important provision to make higher
education more affordable, to expands IRA's and to increase tax
deductions for the self-employed.
Mr. Speaker, these are just a few of the items in this package that I
believe will change this Nation's economic destiny for the better. When
all is said and done, I am confident that we will look back at what we
began here this week and say that we curbed the size of government, we
lowered taxes, and we revived the economic potential of the American
people. Better than that, there will be more to come next year.
Most important, Mr. Speaker, we will be able to say that we gave the
taxpayers the tools they needed and they completed the job. Mr.
Speaker, I urge my colleagues to restore the economic hope across the
country. Vote for this fair rule. Support the Taxpayer Relief Act.
Mr. FROST. Mr. Speaker, I yield 2 minutes to the gentleman from
Washington [Mr. McDermott].
(Mr. McDERMOTT asked and was given permission to revise and extend
his remarks.)
Mr. McDERMOTT. Mr. Speaker, the political vote today is yes, but I
intend to vote no because of the issue of fairness. This country was
founded on a battle about taxation without representation with the
British Government. We have had rebellions in this country, Shay's
Rebellion, the Whiskey Rebellion, when people felt the taxation was
unfair.
We rely in this country on taxpayers, voluntarily collecting from
people. We have a basis in this country of fairness. This bill is
unfair. It is unfair to give somebody making $30,000 with two kids and
trying to deal with all that is involved in raising a family $1,000 for
their kid credit, while somebody making $109,000 gets an average of a
$16,000 tax break on their capital gains.
The lowering of the capital gains rate benefits the wealthy in this
country, and it is clear that what will happen when we get the rate
down to 18 percent, which is almost the lowest tax rate on regular
income, that this will have thrown gasoline on the whole class warfare
issue.
If I am making $500,000 or $600,000 or $800,000 and I can get my pay
given to me in stock options, I will pay 18 percent. That is exactly
what people making $30,000 in this country are paying. We have brought
the tax rate for the richest in this country all the way down to 18
percent. I do not see how anybody can call that fair.
When I look at it, I hear it being made worse by the gentleman from
New York [Mr. Solomon] and the Speaker, who are publicly saying they
are going to reduce the tax rate on capital gains to zero in the next
Congress. That means if you are out there working as an aerospace
mechanic for the Boeing Co. and you make $35,000 or $40,000, you will
be paying somewhere between 15 or 20 percent of your income in taxes.
But if you are making all your money in capital gains, you will pay
nothing. That is unfair, and this bill ought to be defeated.

Announcement by the Speaker Pro Tempore

The SPEAKER pro tempore (Mr. LaHood). The Chair will remind all
persons in the Gallery that they are guests of the House, and that any
manifestation of approval or disapproval of proceedings is a violation
of the rules of the House.
Mr. DREIER. Mr. Speaker, I am happy to yield 2 minutes to my good
friend, the gentleman from Iowa [Mr. Ganske], an able member of the
Committee on Commerce.
Mr. GANSKE. Mr. Speaker, I want to talk briefly about two important
items in the tax bill. One is the tax bill does close loopholes. People
have been concerned about the Tax Code providing special breaks. In a
bulletin put out yesterday by the Joint Committee on Taxation, there
are four pages of fine print provisions on closing tax loopholes, one
of the most important being the so-called Morris Trust structure used
by several companies to sell subsidiaries on a tax-free basis. That is
closed. The bill also eliminates hedging techniques such as shorting
against the box and equity swaps.
I realize these are technical terms and technical provisions, but a
real attempt was made in this bill to close tax loopholes. In return,
we get an expansion of individual retirement accounts.
This bill basically makes for three types of IRA's. The first would
be similar to the current model, but it would greatly expand the number
of people who can be in an IRA, and particularly housewives or
household members who are not working outside the home will be included
in this.
The second choice will be a new account called IRA Plus, whose
contributions would not be tax deductible, but withdrawals from the
account would be tax-free if the IRA is held for 5 years and the holder
is now over 59 years old.
The third expansion of IRA's would be an IRA that would allow you to
roll over savings from your current IRA into an account that would
feature tax relief distributions.
Mr. Speaker, we need to have more savings in our country. Savings
will generate capital investment. Capital investment will generate new
jobs. We have as a nation one of the lowest savings rates in the world.
These tax provisions will encourage average-income citizens to take
advantage of savings in the form of IRA's, and at the same time we are
closing some corporation loopholes, tax loopholes, that we have needed
to do.
Mr. Speaker, this is a good tax bill. I am in favor of this. I
encourage all of my colleagues on both sides of the aisle to do the
same.
Mr. FROST. Mr. Speaker, I yield myself such time as I may consume.
When the vote occurs later in the day, Mr. Speaker, on this
conference report, a significant number of Democrats will vote in favor
of it. I would point out to those watching this proceeding on
television that no Democrats who are going to vote in favor of it have
asked for time during this debate. The only Members who have asked for
time are the ones who are opposed. The Committee on Rules grants the
time to the Members who come to the Chamber and ask for time.
Mr. Speaker, I yield 3 minutes to the gentleman from Rhode Island
[Mr. Kennedy].
Mr. KENNEDY of Rhode Island. Mr. Speaker, I thank my colleague from
Texas for yielding time to me.
Mr. Speaker, the reason I am going to be voting against this tax cut
is that I do not think it is good public policy for this country. I
came in in the 104th Congress and I heard a lot from my Republican
colleagues how they wanted to balance the budget, reduce deficit
spending, preserve prosperity for the future of this country. Guess
what? Two years into the leadership, guess what they do? They go back
to the voodoo economics that got us into this deficit dilemma to begin
with.
Just understand what this rule is saying. It puts in order a tax bill
that will basically lock in a tax cut to the tune of $290 billion over
10 years. As the gentleman before me from my side of the aisle, the
gentleman from Washington [Mr. McDermott] said repeatedly, four times,
the top 20 percent of the income filers get four times the tax benefit
as the bottom 60 percent. So it locks this tax cut in.
Guess what else it locks in? It locks in spending reductions, we are
not hearing about that, Mr. Speaker, spending reductions like a 23-
percent cut in the Social Security Administration. Guess what that
means? Elderly citizens in my district who are trying to arbitrate to
get their Social Security check, who are already waiting 3 months right
now, are going to have to wait an additional year.
Why are they going to have to wait an additional year to get their
measly $435 a month? Because we want to give a $16,000-a-year tax break
to the wealthiest 1 percent in this country. Does that sound fair to
the Members? I do not think it does. But do Members know what this rule
does? It shoves this tax bill down the throats of the American people,
because they do not know what is in it. They do not know what is in it.
If we had enough time to debate this issue, which our majority is not
giving us, if we had enough time to debate this, I could make sure my
constituents in Rhode Island know what the true facts are about the
distribution tables in this tax cut. But we are going to rush this
thing through because we

[[Page H6629]]

have to get out on vacation. We have to wrap business up by tomorrow,
because we have to get out of town.
Everyone loves this tax break, because in the words of my colleague,
the gentlewoman from Ohio [Ms. Deborah Pryce], there is something in
this for everybody. Guess what, Mr. Speaker? This is going to cost us.
When future Congresses which have to pay for these tax cuts want to cut
Social Security, want to cut veterans affairs, want to cut Medicare
$115 billion, guess what, they are not going to do it. Guess what is
going to happen? We are going to end up borrowing again.
So the same crowd that told us that they were all anxious about
deficit spending, guess what, not so. If we need proof of it, read this
tax bill. It is Ronald Reagan trickle-down economics all over again.
They give $500 to a middle-income family. Mr. Speaker, $500 for a
middle-class family, while they give $16,000 tax cuts to the richest 1
percent, can Members answer that, is that fair?
Mr. DREIER. Mr. Speaker, I yield myself such time as I may consume.
It is obvious from the debate on the other side of the aisle that the
Democrats continue to be the tax-and-spend party.
Mr. KENNEDY of Rhode Island. Mr. Speaker, will the gentleman yield?
Mr. DREIER. I yield to my friend, the gentleman from Rhode Island.
Mr. KENNEDY of Rhode Island. Mr. Speaker, I hate that label because
you know what, we are having to tax in 1993 to pay for all the deficit
spending. What the gentleman's party is all about is borrow and spend.
Mr. DREIER. Mr. Speaker, reclaiming my time, if one looks at the
pattern of the 1980's, it is very, very clear, we doubled the flow of
revenues. We saw an increase in social spending and, yes, we did
increase the national defense so that we could bring about an end to
the Soviet Union and the cold war.
Mr. Speaker, I reserve the balance of my time.
Mr. FROST. Mr. Speaker, I yield 4 minutes to the gentleman from
Vermont [Mr. Sanders].
Mr. SANDERS. Mr. Speaker, yes, I also am opposed to this absurd bill.
I think that millions of Americans will wonder why many leaders in the
Democratic Party and the Republican Party have come together on such an
unfair piece of legislation which primarily benefits the very rich at
the expense of millions and millions of other people.
Let us take a hard look at the two proposals that this Congress dealt
with yesterday and today. First, in order to cut spending, the Congress
yesterday voted to cut $115 billion from Medicare over a 5-year period
and $385 billion over 10 years. That means that elderly people all over
this country will see a lower quality of health care at a time when
many of them cannot even afford their prescription drugs.
Furthermore, Congress yesterday voted to cut the administration of
Social Security by 23 percent, or a billion dollars, which means that
when the elderly people and others want information or want to get on
Social Security, it will take them longer to do that. Further, Congress
voted a $13 billion cut in Medicaid over 5 years. That money goes to
hospitals that are primarily serving low income people, exactly the
hospitals that are having financial difficulties today.
Congress voted to cut veterans benefits. Thank you, veterans, for
putting your life on the line. Voted to cut discretionary health
programs by 16 percent, voted to cut community and regional development
by 29 percent. The result of those cuts means that for senior citizens
and for others, life will be harder.
Were there positive programs passed yesterday? Yes, there were. I
support those positive programs. But today let us look at why we have
to cut Medicare and Medicaid and Social Security administration and the
veterans. What are we going to do? Why did we cut? Well, it looks like
today we are going to be dealing with a tax package. What is in that
tax package? Well, under this tax package the wealthiest 5 percent of
Americans will receive almost half of the tax cuts. The upper 20
percent will receive over 70 percent of the benefits.
What is going on in America today? Everybody in the world except the
leadership of Congress understands. The rich are getting richer. The
middle class is being squeezed. Low income people are working for lower
wages than was the case 20 years ago. Last year our friend Bill Gates,
having a tough time, his income, his wealth went from $18 billion to
$42 billion, a $24 billion increase for one man's wealth, $24 billion.
Bill Gates will do very well by this tax bill. Good luck, Bill, maybe
you will make even more than 24 billion next year. But if you are a
single working person or you are a family that does not have any kids,
guess what? You are not going to do very well by this tax bill.
The fact of the matter is that the average tax break for middle-
income families will be about $200. But, this is the Congress after
all, we know where the money comes from to elect people. If you are
among the richest 1 percent, you are not going to get a $200 tax break,
you are going to get a $16,000 tax break. The wealthiest 1 percent will
receive more in tax breaks than the bottom 80 percent. Vote ``no.''
Mr. DREIER. Mr. Speaker, I yield myself such time as I may consume.
It is fascinating to listen to the attack by my friend from Vermont
on Bill Gates. I do not stand here as a defender of any particular
individual. But I would say that Alan Greenspan, chairman of the
Federal Reserve Board, has made it very clear, the reason the United
States of America is so productive today and we have the highest
standard of living is there are more Americans with computers on their
desks who are working hard to make sure that the level of productivity
increases more than any country on the face of the Earth.

Amendment Offered by Mr. Dreier

Mr. DREIER. Mr. Speaker, I offer an amendment.
The Clerk read as follows:

Amendment offered by Mr. Dreier:
After ``debatable for'' insert ``two and one half hours''
and ``three hours''.

Mr. DREIER. Mr. Speaker, I ask unanimous consent that the amendment
to the resolution I have placed at the desk be considered as adopted.
The SPEAKER pro tempore (Mr. LaHood). Is there objection to the
request of the gentleman from California?
There was no objection.
The SPEAKER pro tempore. The amendment is agreed to.
Mr. FROST. Mr. Speaker, I yield 1 minute to the gentleman from
Vermont [Mr. Sanders].
Mr. SANDERS. Mr. Speaker, I thank the gentleman for yielding me the
time.
Does my friend from California, and I will have to ask him to use his
own time to answer the question, really feel that it is appropriate
that when last year the average American worker saw a 2.8 percent
increase in his income, which means that millions of workers in the so-
called boom saw a decline in their real wages, do you really think
there is something appropriate or right about our economic system when
one man saw a $24 billion increase in his income while millions of
working people saw a decline in their real wages? This, I should tell
my friends, is in the midst of an economic boom.
Do we think it is appropriate that the United States continues to
have by far the most unfair distribution of wealth and income in the
industrialized world, with the richest 1 percent owning more wealth
than the bottom 90 percent? Is this something we are proud of? The fact
that we have the highest rate of childhood poverty while millionaires
and billionaires in the country proliferate and that this tax bill
would only make that gap between the rich and the poor even wider?
Mr. DREIER. Mr. Speaker, I yield myself such time as I may consume.
I would say in response to the gentleman that socialism is a failed
economic system and one single individual has been on the cutting edge
of ensuring that the level of productivity in the United States of
America has enhanced to the level that it is, increasing the take-home
pay for many, many people. Computers have played a role in doing that.
Chairman Greenspan has pointed that out. I happen to believe that it is
great. I just want to see more people in a position where they can
enjoy the kind of success that Bill Gates has enjoyed.
Mr. Speaker, I reserve the balance of my time.
Mr. FROST. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, there are strong feelings on this particular piece of
legislation. There are a number of Democrats

[[Page H6630]]

who will support it. There are some Democrats who will oppose it. Each
group has its own valid reasons which will be developed during the
general debate. I would only point out to the gentleman from
California, and I intend to support this legislation, but I would only
point out to the gentleman from California that his side chooses
selectively to ignore the fact that the largest deficits in this
country were run up under Republican Presidents during the 1980's and
the early 1990's.
It was the decisive action, decisive action of the Democrats in this
Congress in 1993 by passing a deficit reduction package that brought us
to the point today where we can entertain a tax cut and we can make a
fair tax cut for the American public.
Mr. Speaker, I yield back the balance of my time.
Mr. DREIER. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, my friend referred to Republican reign over these
deficits. I recommend that he look at the U.S. Constitution. Article I,
section 7 makes it very clear, the responsibility for all taxing and
spending lies right here in the House of Representatives. This is the
first tax cut that we have had in 16 years. For 13 of those 16 years,
this place was controlled by the Democrats. When President Clinton ran
for office in 1992, he promised a tax cut for middle income Americans.
The last Democratic Congress worked with him to bring about the largest
tax increase in history.
Many Members like to claim that that tax increase is somehow
responsible for the economic growth we are enjoying today. Why is it
then that with the measure that we will be voting on within the next 3
hours we are repealing large parts of that tax increase?
The best thing that ever happened to Bill Clinton was the election of
a Republican Congress. If Members look at the fact that in 1993 and
1994 we saw an increase in interest rates, we saw a stock market that
was not taking off, November 1994 saw the election of the first
Republican Congress in 40 years and in 1996, the reelection of the
first Republican Congress in 68 years; if we look at election day 1994,
we can draw a line.
We have seen interest rates on a downward slope since we began to
focus on balancing the budget, reducing the size and scope of
Government and cutting the tax burden on working Americans. In November
1994, the Dow Jones industrial average was at 3,900. Now it is right
around 8,000. The fact is, we as Republicans have helped to improve
this economy and it would not have happened had we not been in the
majority.
I am very pleased that we are working in a bipartisan way to address
this issue of the tax burden on working Americans. I look forward to
seeing this Archer bill pass today and to have it signed by the
President of the United States.
Mr. Speaker, I yield back the balance of my time, and I move the
previous question on the resolution, as amended.
The previous question was ordered.
The resolution, as amended, was agreed to.
A motion to reconsider was laid on the table.
Mr. ARCHER. Mr. Speaker, pursuant to House Resolution 206, I call up
the conference report on the bill (H.R. 2014) to provide for
reconciliation pursuant to subsections (b)(2) and (d) of section 105 of
the concurrent resolution on the budget for fiscal year 1998.
The Clerk read the title of the bill.
The SPEAKER pro tempore. Pursuant to House Resolution 206, the
conference report is considered as having been read.
(For conference report and statement, see proceedings of the House of
Wednesday, July 30, 1997, part II.)
The SPEAKER pro tempore. The gentleman from Texas [Mr. Archer] and
the gentleman from New York [Mr. Rangel] each will control 1 hour and
30 minutes.
The Chair recognizes the gentleman from Texas [Mr. Archer].

{time} 1145

General Leave

Mr. ARCHER. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days in which to revise and extend their remarks and
include extraneous material on the conference report on H.R. 2014.
The SPEAKER pro tempore (Mr. LaHood). Is there objection to the
request of the gentleman from Texas?
There was no objection.
Mr. ARCHER. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from
California [Mr. Dreier], a respected member of the Committee on Rules.
(Mr. DREIER asked and was given permission to revise and extend his
remarks.)
Mr. DREIER. Mr. Speaker, I thank the distinguished chairman of the
Committee on Ways and Means, the author of the Archer bill, which it is
now very appropriately called, for yielding me this time.
I rise, Mr. Speaker, to simply talk about what I think is one of the
single most important provisions in this measure, and that is the
reduction of the top rate on capital gains.
Back in 1993, several of our colleagues came together and worked on
this issue of capital gains. We established what we called the Zero
Capital Gains Tax Caucus. We recognized that capital gains tax rates,
in fact, are some of the most confiscatory that we have of all. Why?
Because people already pay a tax on that income that they are
investing.
So what is it that we need to look at? We need to look at what it is
that the capital gains tax rate reduction is going to do for this
economy. Clearly, we are going to stimulate a dramatic increase in
economic growth.
Every shred of evidence that we have throughout this century has
proven that, going all the way back to Andrew Mellon's stint as
Treasury Secretary under President Warren G. Harding, to the Kennedy
tax cuts of the 1960's and, yes, the much-maligned Reagan tax cuts of
1981, which I was telling the gentleman from Texas [Mr. Archer] earlier
today, I am very proud that that is the one tax bill that I voted for,
the Economic Recovery Tax Act of Ronald Reagan back in 1981.
As we look at decreasing the capital gains tax rate, I am convinced
that we will do more to help working class Americans than virtually
anything else we could do. There was a lot of talk about family tax
cuts, but the studies we have conducted found that by reducing that top
rate on capital gains, we will, in fact, Mr. Speaker, increase the
take-home pay for the average working American family by $1,500 per
year.
Now, if we look at those facts, it is going to improve the
opportunity for many. We also, Mr. Speaker, are going to be able to
increase the flow of revenues to the Federal Treasury. When the Steiger
capital gains tax cut went into place in 1978, we saw a revenue flow of
about $9 billion. During the next several years, before the 1986 Tax
Reform Act, we saw the flow of revenues to the Treasury increase by 500
percent, from $9 billion to $50 billion.
We had H.R. 14. I wanted it to go first to 14 percent then to zero.
Democrats and Republicans joined me on that. We have ended up with a
decent compromise, and I am very proud to support it.
Mr. RANGEL. Mr. Speaker, I yield 30 minutes to the gentleman from
California [Mr. Stark] and I ask unanimous consent that he be allowed
to control that time.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New York?
There was no objection.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume,
and I want to thank the gentleman from California [Mr. Dreier] for
expressing the need for capital gains tax cuts for the working people
in America, because I think his statement proves that even though this
is a bipartisan bill, there are basic differences between Democrats and
Republicans.
Mr. Speaker, I yield 2 minutes to the gentleman from Tennessee [Mr.
Tanner].
(MR. TANNER asked and was given permission to revise and extend his
remarks.)
Mr. TANNER. Mr. Speaker, I want to thank the gentleman from New York
[Mr. Rangel] for yielding this time to me.
This bill before us today is not what I would have written. It is not
what the group I am associated with, called the Blue Dog Democrats,
would have written. There is one gaping hole in all of this discussion
today, unfortunately, and that is entitlement reform.

[[Page H6631]]

But, nonetheless, I think that democracy is an inconvenience
sometimes for those of us who serve in the legislative branch of
government because there are people of good will who have
intellectually honest differences of opinion as to what should be done
for our great land. And so democracy is an inconvenience because none
of us get our way all the time on every issue.
As I look at this bill, I am reminded of what Winston Churchill said
one time when someone asked how his wife was; and he said, compared to
what? Well, we look at this today and say to ourselves, would the
country be better off with the passage of this Balanced Budget Act and
this tax bill than it would be if we defeated it? I have concluded, Mr.
Speaker, that the country will be better off with the passage of this
tax bill today, notwithstanding the fact that there is much work to be
done.
We will hear a lot of rhetoric, Mr. Speaker, about whose fault it was
that we got where we are, and I would suggest that it is probably like
a lot of other things: Both sides are about half right and both sides
are about half wrong. And those who claim that they have the truth and
those who claim that they are the only ones who have the right answer,
I would suggest, ought to grant to others who disagree the same degree
of intellectual honesty they claim for themselves.
I think, on balance, this is a reasonable bill. It will balance the
budget in the year 2002 or before. I am convinced of that, and that is
why I am supporting, as I did yesterday, the spending side, the tax
bill today, and I would urge our colleagues to do likewise.
Mr. ARCHER. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I want to tell the House that this is truly a monumental
bill. It has taken months to produce and it is before us today not
without an awful lot of effort on the part of many, many people.
Before we get too far into the debate, I express my thanks to the tax
staffs of the Committee on Ways and Means, the Joint Committee on
Taxation, and especially, especially the office of the House
Legislative Counsel, who worked around the clock in drafting to put
this bill together. These staffs have given of themselves and taken
time away from their families in order to make this moment available to
all of us, and they deserve our heartfelt thanks.
Mr. Speaker, I yield 1 minute to the gentleman from Michigan [Mr.
Smith].
Mr. SMITH of Michigan. Mr. Speaker, this tax legislation is
monumental, and I thank the chairman very much for yielding me this
time.
What is exciting is that we are starting to let the American people
keep a few more dollars of what they earn in their own pockets instead
of sending it to Washington.
It seems that we have been under the philosophy that the American
people should sacrifice in order to send more money to Washington so
that politicians can spend those dollars. Now at last we are starting
to acknowledge that it should be Washington who should sacrifice; cut
down the size of government, find the best, most efficient ways to
spend less money so that the people who earn that money can keep it in
their pockets and spend it or save it as they decide.
As a farmer, I am especially pleased that we have strengthened the
chances of the survival of the American agricultural industry by
including several provisions in this tax bill that helps us keep a
strong, viable agricultural industry; lets farm families keep and
preserve their farming operations.
So my thanks to the chairman and all those involved in moving us to
this new beginning for America and Americans.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume to
join with the Chair in congratulating not only the staff of both sides
for working together on this bill, but also including an uncustomary
third party that has made this bipartisan effort work, and that is the
President of the United States.
I think the President made it abundantly clear, and both sides of the
aisle agreed, that the American people were fed up with the political
fights. So we join together in thanking the staffs of both sides and
the President of the United States for making certain that we could get
this bill passed.
Mr. Speaker, I yield 1 minute to the gentlewoman from Texas, Ms.
Eddie Bernice Johnson.
Ms. EDDIE BERNICE JOHNSON of Texas. Mr. Speaker, I want to stand here
and applaud the leadership, especially the gentleman from New York [Mr.
Rangel], for what we have been able to achieve in this bill.
Clearly, as it left the House originally I would not have been able
to support it because we had left the real backbone of this economy
out, the middle income and lower income earners who did not get a
break. But as we stand here today, there is indeed some equalization
and fairness in this tax bill that I can truly support.
It is clear that when people make less money, and they are employees
primarily, they pay a much more assured leverage of taxes. When we can
make sure that they get a break, then I know we have accomplished
something.
I am not against the wealthy. They really do give a lot to this
Nation. But all of us know that they have the greatest advantage when
it comes to paying taxes and they did not just deserve a tax break unto
themselves. All of America's workers deserved a tax break. And in this
bill, Mr. Speaker, they get it.
I appreciate this leadership and the White House and I am willing to
support this bill today.
Mr. STARK. Mr. Speaker, I yield 5 minutes to the gentleman from
Missouri [Mr. Gephardt], the leader of the Democrats in the House of
Representatives.
(Mr. GEPHARDT asked and was given permission to revise and extend his
remarks.)
Mr. GEPHARDT. Mr. Speaker, first I rise today to congratulate all who
were involved in this negotiation. I especially want to congratulate my
President and my party for standing for very important principles in
how this tax cut bill was put together. I am very proud, Mr. Speaker,
of what my party stands for and, because of it, this bill has been
improved.
The child credit will go to hard-working families who desperately
need this help. The education credit and deductions will go to help
more young people go to school. There will be in this bill help for
children in health care. So I am very, very proud of what my party
stands for and what we have achieved.
I believe that the bill that came out of the House gave about 55
percent of its benefits to families who earn over $110,000 a year. I
think that has been brought down to about 44 percent. In my view, it is
not where it should be, but it is clearly better. So this agreement is
better because we stood on principle.
I respect the motives of everyone who is here today to argue about
this bill, Mr. Speaker. Everyone is voting for what in their heart and
mind is the best thing for their constituents and the best thing for
the country. So it is in that spirit of humility about my own decisions
and my own votes and respect for the views of others that I say my
decision today is to not vote for this bill, because I think it could
be better and I think it should be better.
Back in 1981, I remember sitting right here after we had lost our
effort to pass what I thought was a better Democratic tax bill and
wondering what I would do. I voted for the Republican bill. In
retrospect, I believe it was one of the worst votes I have ever cast
because of what it did to the economy and what it did to the deficit.
So my views today are tempered by that experience.
But let me spend the rest of my time, Mr. Speaker, explaining to
really my friends in the Republican Party why I feel this bill and this
budget has a deficit of fairness, a deficit of investment and a deficit
of dollars.

{time} 1200

Let me explain to my colleagues why we Democrats feel so strongly
about where the lion's share of this bill should be focused. Last
weekend I went door to door in my district. The median household income
in my district is $34,000. When I talked to my constituents in South
St. Louis city and county, in Jefferson County, what person after
person said to me is, ``I am struggling. I am just getting by. I am
just surviving. I am up to my eyeballs in credit card debt.''
This is the first tax cut that we have been able to legislate in 16
years. Let

[[Page H6632]]

us remember the context in which we are talking today. Over those last
16 years, people at the top have seen their incomes go up by 90
percent. Those constituents that I talked to over the weekend have been
stuck in place or they are falling behind. They have seen no increase
in their income, and they are working harder and longer to overcome
that problem, more hours, more jobs. People said to me, ``I am working
two and three jobs in order to pay my bills.''
So we in the Democratic Party feel strongly that people in the
middle, people stuck on the bottom are the people that we need to be
dealing with, with the majority of this tax cut.
Now, understand our friends on the other side say, ``well, let us
give the tax cut to the people who pay taxes.'' That is what they
always say. The truth is people in the middle and at the bottom pay a
lot of taxes. And we have always had a progressive tax system. That is,
you pay proportionate to your ability to pay taxes.
This bill will make the Tax Code, unfortunately, less progressive.
But let us talk about the economics of it for a moment. And this is
where we must part. I am a Democrat. I am a supply-sider, but I am as
much a demand-sider. Why is it smart to have a progressive tax system?
Why is it smart to give the bulk of the tax relief to people at the
middle and stuck on the bottom? Because they need the help, it is fair,
but because they need the money to spend in the economy.
What do the economists always talk about when they talk if we can
keep the economy growing? It is because, they say, if we can keep
retail demand going. What do we think people in the middle and at the
bottom do with the money they earn? They go to Wal-Mart. They go to K-
Mart. They go to Sears. They spend their money. And because they spend
their money, if they have more money, all the boats can rise. People at
the top can rise in their income. People in the middle. People in the
bottom.
I am a Democrat. I believe in building this economy from the bottom
up, not the top down. I believe our work over the last years in making
the Code more progressive has helped produce an economy where we are
surging forward and jobs are being created and unemployment is down.
Finally, let me say this: I am a tax reformer. I believe we ought to
get less deductions and exemptions and special treatment. I think we
need to get to lower rates for everybody. This bill today will add the
greatest loophole. We will now take the rate for people that can figure
out how to get their income in capital rather than in earnings, or
earned income salary, to half the rate of other people. We are moving
in the opposite direction of what we tried to accomplish in 1986. We
should not be doing that.
Let me end with this: As I get it, this debate will go forward. Our
friends on the other side have said a tax cut next year and a tax cut
the year after that and the year after that. I welcome this debate. I
welcome this debate. This is a good debate for our country. They will
stand for what they believe in. We will stand for what we believe in.
And the country will do better because of it.
I respect my friends on the other side and their views. I strongly
disagree with their views, with all of the best intentions. I think
they are trying to do what is right for the country and the people. But
let me say to them that, in this debate which goes forward, Democrats
are for cutting taxes for middle-income people and people trying to get
in the middle class.
I have heard the Christian Coalition in parts of their party that are
raising that issue within their party. They are right to do it. Let us
go forward with this debate. Let us make this Tax Code fair. But, most
important, let us invest our money in the hard-working, middle-income
families of this country and help them succeed and help move this
country and lift all the boats of this country to higher and higher
levels.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Illinois [Mr. Weller], a member of the Committee on Ways and Means.
(Mr. WELLER asked and was given permission to revise and extend his
remarks.)
Mr. WELLER. Mr. Speaker, I want to take just a brief moment at the
beginning of my remarks just to commend the gentleman from Texas [Mr.
Archer], chairman of the House Committee on Ways and Means, for his
leadership in managing this very important component of the Contract
with America and also very important component for bipartisan agreement
to balance the budget for the first time in 28 years.
This is a great victory for the middle class. It is a great victory
for those who work hard and play by the rules and pay taxes, because
this legislation we are voting on today is the first real tax relief
for the middle class in 16 years.
For the people that I represent in the South Side of Chicago and
south suburbs of Chicago and rural areas to the south and southwest if
they have children, for the average family with children in the
district that I represent, it means an extra $1,000 in take-home pay.
Over 110,000 children are eligible for the child tax credit that is in
this legislation. It is important to families, and because we, as
Republicans, believe that if you work hard and play by the rules, you
should be able to keep more of what you earn.
Because we believe, if you work hard and you keep what you earn, it
is because we believe that you should be able to spend those dollars
better back home, meeting the needs of your families better than we
politicians can here in Washington. This bill is a victory for the
working middle class, and I am proud to support this legislation.
I also want to note that there are three key components in this
legislation that are initiatives that are strongly embraced by the
people I represent in the south suburbs, part of a south suburban
revitalization strategy, legislation designed to provide incentives to
revitalize and clean up environmental cleanup of old industrial sites
in old industrial communities, initiative to encourage the private
sector to hire welfare recipients and give them a chance and give them
a job, and also initiative to strengthen the opportunity for
homeownership with homeownership IRA's.
The work opportunity tax credit works as a way of attracting the
private sector to give welfare recipients an opportunity to have a job.
And I am proud this bipartisan initiative is included in this bill.
My colleagues of the House, I again commend the chairman. I again
commend the bipartisan effort. I urge support of this important
legislation that helps the middle class.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Maryland [Mr. Cardin], a member of the Committee on Ways and Means.
Mr. CARDIN. Mr. Speaker, I want to congratulate the gentleman from
New York [Mr. Rangel] for his work on the conference report. The bill
that we are going to vote on today is far different than the partisan
Republican bill that passed this House just a few months ago. Let me
give my colleagues five changes, and there are many more, why this bill
is a much better bill than we had when it passed the House originally.
First: In regard to the child credit, we have changed the child
credit so that now working families that make $30,000 a year can
benefit from the child credit. That was not the case when the bill left
this House.
Reason No. 2: The estate tax provisions are targeted to give most of
the relief to families that have small businesses or farmers. That is a
major improvement that I congratulate my colleague on.
Third: the education relief. When the bill left this House, it
provided relief for the first and second year of a college education,
but no more. We have now provided relief for college education beyond
just the first 2 years and have provided relief for interest costs to
those who had to borrow money to send their children to college. And we
protected the tuition waiver program so employers can provide education
help to families. Major improvement from when this bill left the House.
Fourth reason: The initiatives for the brownfield that will help our
cities, empowerment zone that the gentleman from New York [Mr. Rangel]
was responsible initially to get through this House have now been
incorporated into the bill that we will vote on today. Major
improvement.
Fifth reason: The gentleman has modified the IRA proposals, got rid
of

[[Page H6633]]

indexing of capital gains so that we do not have exploding deficits in
the future.
We now have a bipartisan bill that, with the bill that we passed
yesterday, will balance the budget and protect the priorities that are
important for the future growth of our Nation. I congratulate the
gentleman from New York [Mr. Rangel] because we now have a bipartisan
bill that deserves the support of this House. I intend to support it.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Arizona [Mr. Hayworth], another member of the Committee on Ways and
Means.
Mr. HAYWORTH. Mr. Speaker, I thank my colleague from Georgia, Mr.
Collins, for the time.
Mr. Speaker, I know it is difficult for professional politicians to
do this, but I would challenge Members on both sides who are career
office holders to leave the spin cycle in the laundry room.
The fact is it is time, Mr. Speaker, for straight talk with the
American people. And the fact is that we have made an important first
step with this legislation. Is it perfect? No. Does everybody get
everything they want? Absolutely not. But to try and keep scores, as if
this were the partisan baseball game the other night, I just think is
something we should leave alone.
Because this is not a game; this is about living, breathing, working
people. Like the working couple from Casa Grande, AZ, who sent me a
letter via fax, the Wilkins family, Barney and Margie. They are
schoolteachers. Their kids are B.J., Megan, and Molly.
Barney and Margie work hard at teaching school. They are not rich
although some people have estimates that say that their combined income
would make them rich. In fact, they have a third job. They supply auto
parts for vintage cars and go to vintage and classic car shows on the
weekend.
They write me and they say, ``Congressman, thanks for this 19th
wedding anniversary gift.'' I do not mean to pick at their sentiment
here, but this is not really a gift to them or a gift to the American
people. Because the money that the American people earn is their money.
They ought to keep more of it and send less of it to Washington.
The challenge is, and this is where we differ in good faith is this
notion, why should families sacrifice to send more of their money to
Washington? Why not let families keep more of their money and let
Washington make the sacrifice? The P.S. is the most important thing.
``P.S., please continue to cut taxes more so we do not have to work
three jobs.''
Mr. Speaker, we are making that first step today to cut taxes, to
reward Americans who work hard. That is the key to this debate, and
that is why I urge passage of this legislation.
Mr. STARK. Mr. Speaker, I yield 4 minutes to the gentleman from
Wisconsin [Mr. Obey].
Mr. OBEY. Mr. Speaker, this is not a fight about whether there should
be a tax cut. It is a fight about who gets it. There is much in this
bill I support. It is a far better bill than the House originally
passed.
I was an original sponsor of the child tax credit, which is contained
in this bill. I support the education tax credits and child health
provisions. But I would remind my colleagues that the fundamental test
of any democracy is to fund its activities through a tax system which
is fair to each and every one of our citizens. Because this is, after
all, a volunteer compliance tax system.
We fought a revolution over the principle of fair taxes. This bill, I
am sorry to say, fails that test.
The most well-off 5 percent of families in the country who make over
$110,000 will get seven times as much relief as all of the 60 percent
of Americans who make less than $37,000. That is simply not fair.
In fact, the wealthiest 1 percent of our citizens, who make more than
$250,000 a year, will get more in tax relief than 80 percent of all
Americans who make $60,000 or less. That is simply not fair. We can do
better.
Then if we take a look at the dollar relief in the bill, we see that
the top 1 percent, whose average income is $650,000, will get a $16,000
tax break under this bill. But if you are in the middle bracket, if you
are in the middle bracket, you will get about $3 a week and you lose
half of that because of what it costs you to get a tax preparer.
If you are among the poorest 20 percent, you will lose $39. You will
actually have a tax increase of $39.

{time} 1215

Mr. STARK. Mr. Speaker, will the gentleman yield?
Mr. OBEY. I yield to the gentleman from California.
Mr. STARK. Mr. Speaker, I do not have anybody in my district that
makes $645,000 a year, but could the gentleman tell me, do they work a
lot harder in the gentleman's district than say that group of people
down a couple who only make $70,000? Is that what happens in Wisconsin
to those folks in the gentleman's district?
Mr. OBEY. Not in mine.
Mr. STARK. Does the gentleman suppose they inherited most of their
money, what they are getting, $645,000?
Mr. OBEY. I have no idea. All I know is that this distribution is not
fair. We can do better.
Mr. Speaker, the other problem with this proposal is that it is based
upon promises that in the next 5 years we are going to cut the Social
Security Administration by 25 percent, that we are going to cut
community development by 30 percent, that we are going to cut veterans'
benefits by 20 percent over the next 5 years. I do not believe that
Members of either party will vote for those kind of reductions when
those budgets come to the floor. That is why the claim that this budget
is going to produce a balanced budget is built on a false promise.
In short, in terms of a fair distribution of tax benefits to our
people, in terms of an honest description of how they are paid for,
this bill I regret to say fails both tests. We can do better. I urge a
vote against this bill until we do.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Ohio [Mr. Boehner], the chairman of the Republican Conference.
Mr. BOEHNER. Mr. Speaker, it is really happening: the first time in
30 years we are actually going to balance the Federal budget. The first
time in a few years we are going to save Medicare and extend the life
of the trust fund for 10 years. We took those votes yesterday.
Today we are going to provide tax relief for the American people, the
first tax cut from Washington in 16 years. We all know that reducing
taxes is going to mean lower interest rates for the American people, it
is going to mean more jobs for the American people and, most
importantly, it is going to mean higher wages for American families.
These are the kind of values that we have been fighting for for
years, trying to bring real relief to middle class American families.
When we talk about lower interest rates, more jobs, higher wages,
sometimes people think these are terms that economists use. Let us
think for a moment about what these bills that we passed yesterday and
today really mean.
A balanced budget and tax cuts mean that it is going to be easier for
families to go out and buy a home. It is going to be easier for
families to send their kids on to college. A balanced budget and tax
cuts mean that it is going to be easier for people to go out, who want
to start a new business, to get that first start. It is going to be
easier for every American to have a shot at the American dream.
That is really what we are trying to do here today and over the last
couple of years, is to renew the American dream for our kids and
theirs. Over these last 2\1/2\ years, it is not what we have done just
yesterday and today, balancing the budget, cutting taxes, saving
Medicare, it has been issues like ending entitlements for farmers and
allowing the market to take place, allowing farmers to decide what they
are going to plant on their land.
It is welfare reform, allowing the States to help those at the bottom
of the economic ladder to become productive members of our society. It
is illegal immigration reform. It has been health care reform. It has
been eliminating 300 wasteful Washington programs, saving $53 billion.
And, Mr. Speaker, this is just a good start.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the distinguished
gentlewoman from Connecticut [Mrs. Kennelly], a member of the Committee
on Ways and Means.

[[Page H6634]]

Mrs. KENNELLY of Connecticut. I thank the gentleman from New York
[Mr. Rangel] for yielding this time and for his hard work.
Mr. Speaker, I rise as a proud member of the Committee on Ways and
Means. As a long time member of that committee, I have taken some very
tough votes. In fact, in 1990 I took two tough votes for the 1990
budget. In 1993 I really did not like a lot of things in that budget
but I knew when the President became the President, President Clinton,
because there was a $290 billion deficit, I had to vote for that bill
if we were going to reduce that deficit. So it is a great pleasure to
vote this week to finish the job and balance the budget for the first
time in this generation.
But I also want to thank the conferees on both sides of the aisle for
listening to those of us who have worked on the Tax Code for a number
of years. When the Ways and Means bill first appeared, there were many
of us who were very, very concerned. We had worked for many, many years
on the earned income tax credit. We had worked for years working to get
a dependent day care credit for men and women who work and have
families, and for the first time, all of a sudden we were going to see
some of that day care credit we had worked so hard for disappear if
they took the child credit.
We found out that we could convince conferees that this would not be
fair because most people go to work because they want that house or
they want that education, and they need that help, even if they have
got two salaries, in paying for good affordable quality day care.
Millions of families, as we well know because we had a battle royal
for the last month over the earned income tax credit, and I do want to
commend the conferees for realizing that if they pay Federal payroll
tax, it is paying to the Federal Government and it is just as good and
just as hard as if they pay income tax. I really feel good about that
piece.
Unfortunately, we were not able to fix the AMT child credit problem,
and I just said to Ken Kies, ``You've got a lifetime of work because
you're the only one that's going to understand exactly what we did
do.'' In fact, we have added a lot of complexity to that bill, and we
will all be back hopefully next fall trying to fix this bill.
But we should celebrate what we have right now where two groups came
together, capital gains yes, indexing no, earned income tax credit yes,
and yes for almost everybody. I vote for this bill and hope a lot of
other Members will, and I know they will.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Pennsylvania [Mr. English], another distinguished member of the
Committee on Ways and Means.
Mr. ENGLISH of Pennsylvania. Mr. Speaker, I rise in strong support of
this tax relief package. In most respects this package is similar to
what the Committee on Ways and Means passed last month. It provides
significant relief to working taxpayers and middle class taxpayers who
are facing the highest tax burden in American history.
Many of us who were elected in 1994 came to Congress pledged to
reduce the tax burden on middle class taxpayers and people who work for
a living. Today we stand on the brink finally of fulfilling that
pledge. This will be the first tax cut for the middle class since 1981,
and not a moment too soon.
This is not as large a tax cut as many of us on the Republican side
had originally argued for, but the net tax cut of $94 billion is more
than the White House was originally willing to subscribe to. That we
have it here today is a tribute to the persistence of a pro-growth,
antitax majority in this House which I am proud to be associated with.
Our tax cut includes a child tax credit to provide tax relief to
families with incomes as low as $18,000; tuition tax relief which makes
college more affordable for a lot of middle class families; an expanded
IRA to encourage retirement savings; a capital gains tax cut to
stimulate growth and opportunity by providing more seed corn for the
economy; and I think this is a tribute to the persistence of the
gentleman from California [Mr. Dreier] as well, small business tax
relief and also tax incentives for home ownership.
Mr. Speaker, in summary, this tax package for working families in
places like Erie, PA means restoring the American dream and making it a
little more achievable. This is a big win for the middle class. Today
we are going to hear from the left wing in Congress that this bill is
inadequate. They do not want tax cuts. But watch your tax return. If
you are a middle class taxpayer, this tax cut is for you.
Mr. STARK. Mr. Speaker, I yield 3 minutes to the gentleman from
Oregon [Mr. DeFazio].
Mr. DeFAZIO. Are you confused? Mr. Speaker, I think a lot of people
listening to this debate over the last 2 days are. They should be. In
fact this legislation is designed to confuse the process, rushing this
through before Congress's month-long vacation, is designed to obscure
the truth.
The truth is yesterday Congress adopted very substantial cuts in
Medicare, cuts in reimbursements, cuts that will drive up premiums for
seniors, cuts that will deprive seniors of home health oxygen benefits,
and today they are using the proceeds of those cuts to fund huge tax
breaks, $275 billion in tax breaks over the next 10 years, tax breaks
that will double the deficit by the year 1999. Yes, that is right. The
balanced budget agreement before us today will double the deficit over
the next 2 years, and that is from the Republican-controlled
Congressional Budget Office. It will probably more than double the
deficit over the next 2 years. A strange path to fiscal responsibility.
What underlays this whole thing? Tax cuts slanted toward the very
wealthy, repeal of the corporate alternative minimum tax; an
embarrassing time in the mid-1980's when Ronald Reagan supported
imposing a corporate alternative minimum tax, as the largest
corporations of this country were getting refunds for taxes they did
not pay. We are going back to that. We will all pay taxes so
corporations can get refunds for taxes they do not pay.
Capital gains. Look at the distribution right here. The largest
amount of money, 44 percent of the benefits, go to the top 5 percent,
those earning over $112,000. If you are in over $112,000, cheer, right
now, OK. If are in the bottom 60 percent, families making less than
$36,000 a year, that is most of my constituents, those are the people
who most need tax relief, look at what that large number of people, 60
percent of the population are going to rake in: 7 percent of the
benefits. What a great day for middle income America. Forty-four
percent for those privileged few at the top and 7 percent for the rest.
Mr. Speaker, this point cannot be made too many times in this debate.
This is being rushed through unnecessarily so people will not
understand the facts. They will say that 75 percent of the benefits are
going to people who earn under $75,000 a year. That is simply not true.
We are engaged here in the big lie.
The big lie is that this is going to balance the budget. It will not.
We have statistics now that show it will double the deficit in the next
2 years. What they are saying is magically in 2001 Congress will come
here and decide to cut $61 billion out of discretionary programs. That
means cut the entire Department of Veterans Affairs, Department of
Energy, Department of Housing, Social Security Administration, and the
Justice Department.
Mr. STARK. Mr. Speaker, will the gentleman yield?
Mr. DeFAZIO. I yield to the gentleman from California.
Mr. STARK. Mr. Speaker, can the gentleman tell me, are we still going
to build the B-2 bomber and is defense going to go up?
Mr. DeFAZIO. We cannot cut a penny out of the Pentagon and we are
going to build 20 B-2 bombers.
Mr. STARK. We are still going to take money out of people's pockets
and spend it here in Washington.
Mr. DeFAZIO. The gentleman is correct.
Mr. STARK. Just not on things that help people.
Mr. DeFAZIO. But in a way to enrich contractors, not to enrich those
people at the bottom.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Connecticut [Mrs. Johnson], another member of the Committee on Ways and
Means and a strong advocate for working families.

[[Page H6635]]

Mrs. JOHNSON of Connecticut. Mr. Speaker, I rise in strong support of
the taxpayer relief act of 1997. This bill provides much-needed tax
relief for hardworking American families.
After 28 years of chronic deficit spending, we are finally getting
our fiscal house in order. The bill before us today, coupled with
yesterday's entitlement reforms, proves that it is possible to balance
the budget, cut taxes, and meet critical needs of our people like the
needs of uninsured children for health insurance.
In this bill we are taking giant strides to help families afford
college educations through education savings accounts, HOPE
scholarships, reduced taxes for families paying for tuition in advance,
and a student loan interest deduction for all those young people who
are struggling to repay the high cost of going to college. We have
taken a giant step forward toward making post-high school education
affordable for all: young people straight out of high school, mothers
going back to work after being out of the workforce for a number of
years, and workers whose employers pay for their education. Today's
economy demands that young people learn well and that working people
keep their skills and knowledge up to date. This bill goes a long way
in helping each of us realize our greatest potential, and so our
dreams.
For families this bill offers a $500 tax credit for each child 16 and
under, health care for kids whose parents work for small businesses
unable to provide health insurance to their employees, educational
opportunity, greater retirement security for our teachers and others
who work for public employers. It also offers a shot in the arm to our
economy, to build the base for continued long-term growth, making
machinery and equipment more affordable, encouraging the research and
development that can keep our companies product leaders in the market,
relief for small businesses, and hope for family-owned businesses that
they can survive mom and dad's passing.

{time} 1230

This is a good bill for people, a good bill for the economy, and I
urge my colleagues' support.
Mr. Speaker, I rise in strong support of the Taxpayer Relief Act of
1997, providing much-needed relief for hard-working American families.
After 28 years of chronic deficit spending, we are finally getting
our fiscal house in order. The bill before us today, coupled with
yesterday's entitlement reforms, proves that it is possible to balance
the budget and provide tax cuts to America's families and meet critical
needs of our people, like health care for uninsured children.
In this bill we are taking great strides forward to help families to
afford college educations--through education savings accounts, HOPE
scholarships, reduced taxes for families paying for tuition advance,
and student loan interest deduction for all these young people
struggling to repay the high cost of going to college.
We have taken a giant step toward making a post-high school education
affordable for all, young people straight out of high school, mothers
going back to school after being out of the work force for a number of
years and workers whose employers pay for their educations. Today's
economy demands that young people learn well and working people keep
their skills and knowledge up-to-date. This bill goes a long way in
helping each of us realize our greatest potential--and so, our dreams.
For families, this bill offers a $500 tax credit for children 16 and
under, health care for kids whose parents work for small businesses
unable to provide health insurance to their employees, educational
opportunity, greater retirement security for teachers and others who
work for public employers.
It also offers a shot in the arm to our economy to build the base for
continued, long-term growth--making machinery and equipment more
affordable, encouraging the research and development that can keep our
companies product leaders in the market, relief for small business, and
hope for the family owned business that they can survive Dad or Mom's
passing. For the first time, this bill recognizes the special role of
family farms and businesses by creating separate, higher exemption for
those estates. This will enable more family farms and businesses to be
passed down to the next generation successfully.
This is a good bill for people, for families, and for our economy.
It's good tax policy and I urge a ``yes'' vote.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Michigan [Mr. Levin], a member of the committee.
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Speaker, the Democratic Party has stood for economic
growth with equity. The 1993 Deficit Reduction Act worked in both
respects, promoting the dramatic deficit reduction that has been a
major source of our sustained economic growth and providing a tax cut
for low- and middle-income families through expansion of the ITC, and
the predictions of economic doom from those who opposed the 1993 act
came from many of the same people who voted for the 1981 legislation
that led to the deep deficits of the 1980's. Time has proved them as
wrong as to 1993 as it did for 1981.
The tax bill now before us shows that today it does indeed take two
to tango, but that does not mean the two partners have always been
dancing in the same direction. Democrats have focused on responding to
the pressures on middle- and low-income families whose income stagnated
amidst the general boom of the last 5 years, while many of the majority
have been dancing too often to the tune of the very wealthy, and
Democrats have been resisting proposals that would bust budget in later
years while the majority has been pushing some of the same approaches
that engendered the deficits of the 1980's.
So we Democrats worked with President Clinton to target the child tax
credit to middle-income families, to provide help for families with
escalating costs to educate their kids after high school and to provide
the child credit for hard-working families making $18 to $15,000 as
well as those making $25 to $100,000.
In this strenuous effort on the tax bill we have lost some battles,
but we have also won some vital ones. As a result, today I am voting
for this tax bill.
Mr. COLLINS. Mr. Speaker, I yield myself 2 minutes.
Mr. Speaker, I was sent to Congress in 1993 by the people of the
Third District of Georgia with a very specific list of legislative
goals. The budget agreement negotiated between the Congress and the
President includes many of those goals. With the passage of the Tax
Relief Act, we will successfully have achieved many reforms on behalf
of all Americans.
Mr. Speaker, today's vote is the result of months and months of
diligent work in an effort to assemble a budget that the American
people deserve. It is the product of a grassroots campaign where input,
ideas, and priorities have been gathered not only from Georgia, but
from people all across the country.
This measure will put in law their priorities, which include
balancing the Federal budget, providing tax relief to working families,
and creating incentives for people to invest. It returns physical
responsibility to Government by balancing the Federal budget just as
families must balance their budget. Most important, this bill will
leave $94 billion in the private sector, where working people will be
able to keep more of their hard-earned dollars and small business
owners will have the chance to invest and create jobs.
Today success is not a victory that can be solely claimed by the
Congress or the President. It is instead a victory for the people of
this country who sent their representatives to Congress to cut taxes,
reduce the size of the bureaucracy, and return fiscal responsibility to
the Federal Government. The $500 per child tax credit, capital gains
tax relief, reduction of the estate tax, tax incentives that reduce the
cost of education, preservation of the Medicare commitments we made to
our seniors and relief from the alternative minimum tax all are reform
ideas that clearly reflect the priorities of the citizens all across
this country.
Mr. Speaker, I am humbled by the opportunity and proud to support
this Tax Relief Act and believe it is a victory for the hard-working
people of this country.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from
South Carolina [Mr. Spratt], a great American, someone that has been so
helpful in making certain that we got here on the floor today, and the
ranking Democrat on the Committee on the Budget.
Mr. SPRATT. Mr. Speaker, I thank the gentleman for yielding this time
to

[[Page H6636]]

me and for his compliment, and, Mr. Speaker, I would like to note, as I
did yesterday, the reason we are here near the passage of a major tax
cut bill.
In 1993, we dealt with the deficit and dealt with it squarely on both
sides of the ledger, revenues and spending, and today we reap the
benefits of what we sowed. Because of what we did in 1993 the deficit
has come down 5 years in a row; it is down to at least less than $40
billion this year, and that is phenomenal. It happened because we
capped discretionary spending, we applied a pay-as-you-go rule to
entitlements and tax cuts, and we restored the revenue base of the
Federal Government. Corporate tax revenues, for example, were up last
year by $72 billion, more than 70 percent over 1992.
The reason we were able to pull together yesterday's spending bill
and today's tax bill is that on May 1 CBO finally agreed with OMB that
the Government's revenue tax increases are not episodic, not 1-year
phenomena, they are permanent. These are permanent phenomena, such that
over the next 5 years CBO was willing to add $225 billion, all
together, to its revenue estimates. That made today possible and
yesterday as well.
And having come this far, our goal is clear. We want to balance the
budget and finish what we have started. We want to do tax cuts, sure we
do, but we want to do them in a way that we achieve a balanced budget
in 2002 and thereafter. That is why we decided in the balanced budget
agreement to keep our tax cuts within strict limits, $85 billion in net
revenue losses over the next 5 years, $250 billion in net revenue
losses over the next 10.
When this bill left the House it was outside those limits, and in the
outyears it threatened revenue losses that would have undermined a
balanced budget for the long run. It was also tilted to top bracket
taxpayers. It made room for a double-barrelled capital gains tax cut
with both a low rate and indexing, but it could not find room for a
child tax credit for families with 2 or 3 children making less than
$30,000.
I voted against that bill, but I will vote for this one, and I do not
agree with everything in it, but I think it comes from conference to us
in far better shape than it left the House, and let me give my
colleagues just three examples.
First of all, the children's tax credit which we all supported now
goes to families who need it the most, families with 2 children or 3
children or more who work hard but earn less than $18,000 a year. It
would have been unconscionable to pass something called a child tax
credit and leave those families and 9.5 million children out. Democrats
fought to get them in, we prevailed, and we should be proud of that.
The tuition tax credit which the President made the centerpiece of
his tax cuts, which we as Democrats all of us heartily support, now it
will not stop in midstream after the first 2 years in college as it did
in the House bill. Once again we prevailed. This bill has a credit that
will apply to the third year and fourth year and graduate education, a
20-percent tax credit of tuition expenses.
And the capital gains tax which the Republicans wanted is their piece
of the pie. It is in this bill too, but unlike the House bill, this
bill does not stack one preference on top of another. A lower capital
gains rate is in, but indexation is out, and by taking it out we have
taken out a time bomb that would have caused revenue losses to explode
in the outyears, undercutting our whole objective, which was to balance
the budget in 2002.
Mr. Speaker, frankly I would have held off the tax cuts until we had
our bird in hand, a balanced budget. But I believe this tax bill is
consistent with our objective of balancing the budget by 2002, and I
know this, it is much fairer than the tax bill that we passed in the
House just a few weeks ago. It is fairer for hard-working Americans who
need tax relief and deserve it, much fairer than the first bill. That
is why I intend to vote for it.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Michigan [Mr. Camp], a member of the Committee on Ways and Means.
Mr. CAMP. Mr. Speaker, I thank the gentleman for yielding this time
to me.
Today we celebrate an important achievement by the Congress and the
White House. But most importantly, we celebrate a victory for the
American people. Yesterday in the spending bill we celebrated balancing
the budget for the first time in 30 years, saving Medicare, which is so
important for health care for our seniors. But today we celebrate with
the American people receiving tax relief for the first time in 16
years. Working families in mid-Michigan and across America who are
raising children and saving for their education will receive not only a
$500-per-child credit, but also tax relief to help pay for the rising
costs of tuition.
I represent a primarily rural district in the middle part of
Michigan, and for millions of farmers across the country and many
farmers in my district this tax relief bill means a better chance of
continuing to do what they love to do, and that is feed our Nation and
the world. It also provides the opportunity to pass on the farm to the
next generation, and many farmers in my district are second and third
generation farmers. With this bill farmers will get tax relief from
capital gains tax, and farming is heavily capital intensive, and also
relief from death taxes that often force families to give up family
farms in order to pay the IRS. We are providing family farmers with
relief by providing income averaging to try to level the peaks and
valleys that often come with unreliable weather and crop years, and
that will help with their tax bills.
Mr. Speaker, family farmers in mid-Michigan are tired of knowing the
IRS is waiting to claim a huge share of their efforts. With this bill
we deliver real tax relief that will lead to the opportunity for
greater prosperity and a higher quality of life on the family farm and
in the homes of all Americans.
Mr. STARK. Mr. Speaker, I yield 5 minutes to the distinguished
gentleman from Washington [Mr. McDermott].
(Mr. MCDERMOTT asked and was given permission to revise and extend
his remarks.)
Mr. McDERMOTT. Mr. Speaker, we are today dealing with a tax bill that
I think if people are watching this they would have trouble figuring
out where everybody is coming from. Some people, the majority, believe
that this is the best tax bill since sliced bread. Some of the
Democrats say, well, we took a bad tax bill and made it a little bit
better. But there are some of us who think that this bill is so bad
that it ought to go down because it is not fair, it is not fair enough.
Mr. Speaker, I would like to associate myself with the remarks of
both the gentleman from Missouri [Mr. Gephardt], the minority leader,
and the gentleman from Wisconsin [Mr. Obey], but I will give my
colleagues a couple specifics. Let us take a woman who has two kids who
makes $35,000 and teaches school.
Now she pays 15 percent of her income in FICA taxes and then is taxed
at the 15 percent rate beyond that. Somewhere around $7,500 to $10,000
of her income goes in taxes out of a $35,000 income.
Now let us take and contrast somebody who makes $200,000 in unearned
income; that is, they invest in the stock market and they make
$200,000. Under this bill they will be taxed at a 20 percent rate; the
schoolteacher at a 30 percent rate; the unearned income at a 20-percent
rate because the person earning their income in capital gains pays no
FICA tax, no FICA tax.
Now in my view that is unfair. The person making $200,000, taxed at a
20-percent rate under this bill will pay $40,000 in taxes.
Now let us get to the tax breaks. Here is the woman. She has paid
$10,000 in taxes. She gets $1,000 back, $500 for each one of her kids.
The person making $200,000 and paying 20 percent has two kids, so he
gets $1,000 back.
Is that fair to a woman raising two kids, making $35,000, paying 30
percent of her income in taxes and getting $1,000 back and somebody who
makes $200,000 worth of unearned income, and they get $1,000?

{time} 1245

That is not fair. Mr. Speaker, the unfairness of this I think is only
one of the problems. As I listen to people speak here, I continually
believe that the Contract With America's idea of term limits is buried
under all of this.
An awful lot of people who are voting for this today are voting
politically

[[Page H6637]]

correct when they vote yes, but they are not thinking long term. They
do not expect to be here in 2005 or 2006 when the real impact of this
bill comes to rest on the American people.
Today's New York Times on the editorial page, page 21, says ``The
deal's long-term effect has economists uneasy.'' When these capital
gains cuts and these estate tax and all the other cuts come to full
pressure on the economy, we will be facing the baby boomers going into
their senior years with no capacity, because we have dug a hole in the
revenue side. We will not be able to deal with their problems.
Mr. STARK. Mr. Speaker, will the gentleman yield?
Mr. McDERMOTT. I yield to the gentleman from California.
Mr. STARK. Mr. Speaker, I would ask the gentleman, is it not true
that we are not really going to have the budget balanced for 3 or 4
years, 3 or 4 years from now when it finally comes to balance, and if
we had no bill yesterday and did not do this tax bill today, we would
balance this year or next?
Mr. McDERMOTT. Mr. Speaker, the gentleman is absolutely correct.
Mr. STARK. And then after that, under the Republican bill, do we not
have deficits that just zoom right down to below zero?
Mr. McDERMOTT. There is no question, Mr. Speaker, that ultimately the
deficit will go back up again because of these tax breaks. If we had
let the situation alone, the situation that was created in 1993 by the
tax bill which we passed, and incidentally, people stand out here and
say we are making all these great tax cuts. They have not changed in
this bill one single provision from 1993. The bill that set us on the
path that has gotten us in the good situation we are in today so we can
talk about tax breaks, not a single provision of that has been
repealed.
Mr. STARK. Mr. Speaker, do not higher deficits that the Republicans
are giving us with these bills lead to higher interest rates?
Mr. McDERMOTT. That is what Mr. Greenspan says.
Mr. STARK. So if this family around $30,000, $40,000, savings $200,
and a family at $150,000 to $600,000 saves $10,000 or $15,000, that
$200 is going to be eaten up in higher interest rates, and the people
with capital gains in the stock market are going to have all the profit
out of this bill?
Mr. McDERMOTT. There is no question, their credit card debt is going
to go up.
Mr. COLLINS. Mr. Speaker I yield 2 minutes to the gentleman from Ohio
[Mr. Portman], a member of the Committee on Ways and Means.
Mr. PORTMAN. Mr. Speaker, I thank my friend, the gentleman from
Georgia, for yielding time to me.
I want to start by commending the gentleman from Texas, Mr. Bill
Archer, because he held firm and worked in a bipartisan way with the
gentleman from New York, Mr. Charlie Rangel, and others to ensure that
hard-working Americans are going to get their first tax break in 16
years. They deserve it.
What is truly remarkable about this, of course, is we are doing it
despite what we might hear from the other side in the context of a
balanced budget. A lot of these tax relief provisions are going to help
us get to that balanced budget, because they will help grow the
economy.
It is a sound package overall. I certainly support it. What does
concern me about the package is that we did not do more in it to
simplify the Tax Code for taxpayers and for the already troubled
Internal Revenue Service that is supposed to administer all the things
we have passed here on the Hill.
Let me be clear, there are some simplification provisions in this
bill. We need to talk about those. One is it that most people do not
have to worry about capital gains when they sell their homes. That is
an enormous benefit for taxpayers and a great simplification.
We also get rid of some of the worst aspects of the corporate
alternative minimum tax. That is important for tax simplification. AMT
relief will help create jobs in this country.
Finally, we take away a lot of unnecessary and costly regulations in
the State and local pension plans. That is also in this bill. That is a
good simplification measure.
To be fair, there are a number of things here that add to the
complexity; last-minute revisions in the child tax credit, for instance
that makes it refundable and in various ways adds enormous complexity.
We would have to face up to it, too, that some of the IRA proposals
cannot be deemed simplification. But again, I support reducing the tax
burden.
This is a good package. I commend particularly the chairman for
standing firm and making sure we got real relief. But I do think we
missed an opportunity. We missed an opportunity to simplify the Tax
Code. Now I think the next step should be as a Congress to make this
code fairer, flatter, and simpler. That is the next thing we need to do
for America, for all of the taxpayers, for the Internal Revenue
Service, and for the tax system generally.
Mr. RANGEL. Mr. Speaker, I yield such time as he may consume to the
gentleman from Virginia [Mr. Scott].
Mr. SCOTT. Mr. Speaker, I rise to address a colloquy with my
colleague, the gentleman from New York [Mr. Rangel], ranking member of
the Committee on Ways and Means.
It is my understanding that the number of empowerment zones will be
expanded through the passage of this legislation. As we know, HUD has
found 2 empowerment zones and 11 enterprise communities, including
Norfolk, VA in my district, to be the most successful in meeting the
performance milestones. Those milestones include initiating and
implementing job training programs, recruiting unemployed individuals
into both job training and education programs, increasing the number of
new businesses in the region, and creating new jobs.
In order to reward communities for these efforts, should these
successful enterprise communities be given priority consideration for
designation as empowerment zones?
Mr. RANGEL. Mr. Speaker, will the gentleman yield?
Mr. SCOTT. I yield to the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I say this to the gentleman from Virginia; I
was the original sponsor of the initial enterprise and empowerment
zones, and also the latest bill which expands them. While it was not
included in the Republican bill, it is in the bipartisan bill.
As the gentleman well knows, communities have to file and show their
proposals before they are selected by HUD. It makes a lot of sense that
those enterprise communities who have done more than have a plan, but
demonstrated a success with those plans, should be given priority as we
move forward in the next round of selecting the new empowerment zones
and the additional enterprise communities.
Mr. SCOTT. Mr. Speaker, I thank the gentleman for that comment, and
look forward to Norfolk being given that consideration, because it has
done such a good job through Norfolk Works and other programs such as
that.
Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in opposition to the bill before us today. Mr.
Speaker, H.R. 2014 cuts taxes by over $100 billion in 5 years and
almost $300 billion over 10 years. Those are massive cuts, and if this
Congress had the gumption to legislate with long-term interests in
mind, we might have scrapped these cuts entirely and used the so-called
savings to balance the Medicare trust fund, which we have not done. We
could have made Medicare solvent well past 2020 had we not entertained
this amazing tax bill.
Who gets the cuts? Half the cuts go the richest 5 percent of
Americans, those with over $150,000 in income. The richest 20 percent
gets 75 percent of the benefit, the top 35 percent get huge benefits,
the bottom 60 percent get 7 percent of the benefits.
Compare that with the richest 1 percent with average incomes of
$645,000. They are getting $16,000 every year in benefits out of this.
The lowest 20 percent of the people in the low-income class are going
to pay $39 a year more taxes. Those are the very people that the
Republicans and the President and his welfare bill have cut off the
rolls. Those are the people they are dumping on. That is not
Christianity, that is greed. That is awful, to take the poorest
Americans, deny them the assistance we have all tried to give them, and
then increase their taxes, on top of it.
There is no magic in projecting who benefits from this bill. When we
target

[[Page H6638]]

$35 billion of estate tax relief, we end up helping those 2 percent or
3 percent of Americans who have huge estates and obviously incompetent
children who cannot afford the business, and to pay it off with the
generous terms we already give them. When we cut capital gains from a
maximum of 28 to 20 percent or even 18 percent, we help the most
affluent Americans.
We should not be reluctant to question whether it is fair to give
massive tax breaks to the wealthiest Americans while those at the
bottom pay an increase in excise taxes. The rich make out better than
everyone else.
Special interests are also making out like the Beltway bandits who
represent them. According to the Joint Committee, this bill contains 80
items which are highlighted as required by the line-item veto law
because they give tax benefits to 100 taxpayers or less, and create a
special transition relief for 10 taxpayers or less in any particular
year. This ought to be embarrassing, to have this list appear in a bill
that is rushed to the floor so quickly.
Members of Congress have not had time to examine those items. I am
not saying that all these provisions are bad. I am saying that this
list should have been a red light for this Congress to delay the bill
until our reservations could be addressed.
For instance, it gives Amtrak a $2.3 billion tax break, which no
other company enjoys. I support Amtrak, but I am troubled that we
tucked away a provision to give a $2.3 billion relief to Amtrak without
having discussed it in Appropriations.
Another provision gives Amway a break for two of their Asian
affiliates. According to yesterday's Wall Street Journal, Richard
DeVos, Amway's founder, donated $500,000 to the Republican Party. Now,
in July, his company gets a tax break thrown into the conference report
that neither the House nor Senate approved. This is the tax fairy who
appeared in the middle of the night, giving Amway this huge benefit
after they contributed $500,000 in contributions to the Republican
Party. That is payoff, big time. That is giving away Americans' tax
dollars in exchange for contributions solicited by the Republican Party
from their rich benefactors.
There is a special benefit in here for Simmons Enterprises, a rifle
shot in the estate tax area, and another favor from the tax fairies for
Harold Simmons, a Dallas investor and baron of the sugar beet
businesses.
Mr. Speaker, I do not like what I know about this bill. It is unfair.
It discriminates against the average American. It gives only to the
rich. But I like even less what I suspect is in this bill, and it is
unfair. It deserves to be defeated. I urge a ``no'' vote.
Mr. Speaker, I reserve the balance of my time.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
California [Mr. Herger], another member of the Committee on Ways and
Means.
Mr. HERGER. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, this tax bill is why I came to Congress. I have been in
the House of Representatives since 1987, and ever since I have been
fighting to help the American people keep more of their own hard-earned
money. This country has not had large-scale tax relief like the kind we
are voting on today since 1981, 16 long years. Of course, under a
different Congress, they have been dealt their share of tax increases,
including the largest tax hike in American history just 4 short years
ago.
What a difference 4 years can make, and what a difference a
Republican Congress can make. Today, instead of voting to push Uncle
Sam's hands deeper into the American people's wallets, we will be
voting to tighten Uncle Sam's belt. Today we will be providing a $500-
per-child tax credit to America's families. We will be providing
significant tax incentives for education. We will be expanding IRAs to
help Americans save for their own retirements.
We will be making major cuts in capital gains taxes to help keep our
economy growing, and we will be providing a major relief from the death
tax, so our Nation's family farms and small businesses can be passed on
from generation to generation.
Mr. Speaker, today finally we are giving the American people the tax
relief they deserve. Sixteen years is long enough. I salute the
chairman, the gentleman from Texas [Mr. Bill Archer] on this historic
achievement, and I urge all my colleagues on both sides of the aisle to
vote for this historic conference report.
Mr. RANGEL. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
North Carolina [Mr. Etheridge], and I would point out the great support
that his task force on education has given to improve the quality of
the bill we will be voting for.
Mr. ETHERIDGE. Mr. Speaker, I thank the ranking member for this time,
and also for his hard work.
Mr. Speaker, I rise in support of this middle-class tax relief bill.
I sought this office to fight for North Carolina values, to look out
for our farmers, and to help our families and provide quality education
for all of our children. This bill makes significant strides in each of
these goals.
The first bill I introduced as a Member of this people's House
provides estate tax relief for our family farmers and small businesses.
I am very pleased that this bill contains immediate relief for our
family farmers and small businesses from the heavy burden of estate
taxes. This bill is good news for North Carolina farmers.
In addition to the $500-per-child tax credit, this bill will help
families in North Carolina and throughout this country to obtain
educational opportunities for their children.

{time} 1300

As a former two-term superintendent of my State's public schools, I
know that education is the key to a brighter future for all Americans.
For middle-class families and for those families struggling to make it
into the middle class, education is the pathway to the American dream.
This bipartisan budget agreement represents the most significant
investment in education in a generation.
We have more to do, Mr. Speaker. We must raise education standards.
We must rebuild our crumbling schools. We must help put more police on
the street and make our communities safer. We have more work to do, but
this is a day to celebrate for the American people. On behalf of the
North Carolina farmers, small business people and families struggling
to provide a decent education for our children and who want to achieve
the American dream, I urge my colleagues to support this bill.
Mr. STARK. Mr. Speaker, I yield 2 minutes to the gentleman from
Vermont [Mr. Sanders].
Mr. SANDERS. Mr. Speaker, I thank the gentleman for yielding me this
time.
Let me give my colleagues several reasons why we should defeat this
tax proposal, bring it back to the drawing board and come up with
something new. No. 1, if we are interested in a balanced budget as
quickly as possible, vote ``no.'' Without this tax proposal, economists
tell us that in 1 year or 2 years, we will move toward a balanced
budget. With this proposal, the deficit will go up in the next several
years and it will take us 5 years to move toward a balanced budget. So
vote no if you want to get toward a balanced budget as quickly as
possible.
The second issue, and that is what this chart deals with, is that, if
you are interested in helping middle income and working families rather
than the rich and the superrich, you should also oppose this
legislation. Last year Bill Gates had a good year, a very good year.
His personal wealth went from $18 billion to $42 billion, an increase
in wealth of $24 billion in 1 year. Putting that into perspective, if
you are an average American worker and you saw a 3-percent increase in
your compensation, that would mean that you earned $1,000 more last
year. That means that 24 million American middle-class workers saw an
increase in 1 year equal to what Bill Gates saw an increase in his
income last year; 24 million workers, middle-class workers, not low
wage workers, end up seeing an increase collectively compared to one
man.
The issue we are debating is who do we want to help with this tax
proposal. If you want to help Bill Gates and his friends, vote ``yes''.
But if you want to help middle-income and working families, vote
``no''. It is wrong that the upper 1 percent receive more in tax breaks
than do the bottom 80 percent. Vote no.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes and 30 seconds to the
distinguished gentleman from Florida [Mr.

[[Page H6639]]

Shaw], chairman of the Subcommittee on Human Resources of the Committee
on Ways and Means, a gentleman who has had a lot to do with legislation
dealing with families.
Mr. SHAW. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, we have heard a number of Members come to the House
floor and come in with some figures as to who is getting the basic
advantage of this tax cut. We know that well over 70 percent, well over
70, I think it is 76 percent goes to middle income and below of the tax
cut that we are looking at. So let us quit playing this game. This is a
well-balanced bill.
I think that when we are determining who is getting the advantage, I
think it is also important that when we define somebody's income that
we come to the floor and be really forthright with how we come up with
the percentages that we do as to the amount of income that somebody
has. As we know, the Treasury came out with some of these figures by
actually imputing the rental value of somebody's home that they own and
putting that on top of their income as well as other things, which they
did not actually enjoy in the form of cash coming in or any type of
recognizable income.
The imputed income is a very unfair way of defining somebody's income
so that we skew the figures.
I think when we are talking about who is getting what, that it is
very important that we be very factual and that we be very out front
with the people.
If some of the speakers that have come to the floor are suggesting
that we in the Congress or that they in the Congress want to tax the
imputed value of somebody's home, I would suggest that that is a very
foolish thing and a very foolish position for somebody to have; but I
think they should make that point and go forth with it without trying
to come up with some phony baloney type of figures here in order to
make a point that they want to make that simply is not true and is not
acceptable by the vast majority of the American people.
I think it is important that we get back on course and we look at the
tax breaks and that we look at exactly what we are doing. We are giving
the child tax credit, which is a direct cash payment off, directly off
the income tax to middle- and lower-income people. The capital gains is
something that is enjoyed by people whether they have $30,000 income
and a mutual fund or whether they, their income is over $100,000 and
they make stock transactions or investing in companies which produce
jobs. The American people win with this bill. I would urge all of my
colleagues to support it.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume. I
would like to respond to the gentleman from Florida in saying that we
are going through a period of trying to learn to be bipartisan, and the
gentleman and I have a whole lot of learning to do. I think he will
agree that the Republicans wanted a tax cut bill and the President did.
The question was who wanted one the most.
When the priorities came, they sought to make capital gains tax cuts
the priority. They sought to make estate tax relief a priority. They
sought to make the individual retirement funds a priority. These were
the things that people in higher incomes enjoyed.
That is why so many Democrats are disturbed. We sought to stay with
those for college educations, for those kids that come from working
families. We did not call it welfare. We said, if you work hard and you
pay taxes, you should get help. So there is still a major difference
between the gentleman's side and ours.
We join together in saying, the President and the people of the
United States want a bill. But it does not mean that we swallow their
principles. But it does mean, when we supported our President, we said
we are with you, Mr. President, but there has to be some basic
Democratic principles there. So the priorities were there.
Mr. Speaker, I yield 2 minutes to the gentleman from Georgia [Mr.
Lewis], our distinguished deputy leader.
Mr. LEWIS of Georgia. Mr. Speaker, this bill is a good bill. It is a
good bill because President Clinton and Democrats stood up for working
Americans and demanded tax relief for working families.
In 1993, Democrats made hard budget choices, hard choices that have
brought millions of jobs and economic prosperity to our Nation. Because
of those hard choices, we are close to balancing our budget. Because of
those hard choices, we can give tax cuts to the American people.
Today again, Democrats have succeeded. President Clinton and
Democrats in Congress have turned a Republican tax bill targeted to
Wall Street into a tax cut benefiting Main Street.
Because of Democrats, families earning between $20,000 and $30,000 a
year will get a $500 per child tax cut. Because of Democrats, there is
a HOPE scholarship to make college more affordable to our children.
Because of Democrats, there are tax cuts for people inheriting farms
and small businesses. Tax relief for working families, tax relief for
education, tax relief for owners of farms and small businesses, these
are Democratic values. These are the ideas President Clinton and the
Democrats fought for and won.
Mr. Speaker, thanks to President Clinton and the Democrats, we have a
growing, vibrant economy, a shrinking deficit and now a tax cut for
working families.
Mr. Speaker, I urge all of my colleagues to support this tax cut
bill.
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Louisiana [Mr. McCrery], another member of the Committee on Ways and
Means.
(Mr. McCRERY asked and was given permission to revise and extend his
remarks.)
Mr. McCRERY. Mr. Speaker, I had the good fortune a little while ago
to hear the minority leader address the House, and I want to compliment
him on the tenor of his remarks. He addressed the House and the Members
of my side of the aisle with respect and engaged in an honest debate
about tax policy in this country and what it ought to get us.
The minority leader spoke about the consumption side of the ledger
and how tax cuts ought to go into the pockets of Americans so that they
can consume, because after all, he said, consumption is what drives
economic growth. And while that is technically true, an economist would
say that, I think an economist would also say if you do not have
production in society, you are not going to have too many people
consuming much, because it is the production side of the economy that
creates the good paying jobs with good benefits that allows people to
consume.
We have tried in this tax bill to balance those concerns. Yes, we
want to put more money in the pockets of people so that they might
consume more, maybe even they will save a little bit for their
children's education or their own retirement. But we also wanted to
increase the incentives in the Tax Code for production. We want to help
keep good paying jobs here in the United States. We want to encourage
people to save their money, invest their money in productive
investments; thus, the capital gains tax relief and the alternative
minimum tax relief. That will help keep good paying jobs here in the
United States and even help create more good paying jobs. We think that
is important.
This is a well-balanced tax bill that deserves the support of
Democrats and Republicans alike.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Indiana [Mr. Roemer].
Mr. ROEMER. Mr. Speaker, I rise in strong support of this bill for
what it provides for the average family for a lifetime of education
benefits. Let us say you are an average family from South Bend, IN, and
you have three children. We now have an education IRA that if you
struggle and save $500 a year, that $500 a year is tax deductible and
the money you make on that IRA years later for college, you can
withdraw tax free.
Let us say that you then send your children to Indiana University at
South Bend. They may be eligible for a $1,500 HOPE scholarship.
Finally, after graduating with your associate's degree from Indiana
University and you work for Ameritech, Ameritech then pays to finish
your undergraduate degree. They get your bachelor's degree for you.
That is then tax deductible for you. You would not pay any taxes on
Ameritech paying for your education. That is fair to the average
midwestern

[[Page H6640]]

family. That is a good bill for education. That is a strong bill for
America. I hope my colleagues will support it.
Mr. RANGEL. Mr. Speaker, I yield such time as he may consume to
gentleman from Texas [Mr. Edwards].
(Mr. EDWARDS asked and was given permission to revise and extend his
remarks.)
Mr. EDWARDS. Mr. Speaker, I rise in support of this legislation.
Mr. Speaker, I will support the bipartisan budget agreement because
it will do four primary things: balance the budget, reduce taxes for
working families, extend the solvency of the Medicare Trust Fund and
make a college education more affordable for all Americans.
The tax and spending reduction legislation translates into the first
balanced budget in a generation and much needed tax relief for working
families, students, and small businesses.
In addition, the package will help provide health insurance for
millions of uninsured children whose parents are working but cannot
afford the premiums.
I am pleased to see the estate tax, also known as the death tax,
reformed and the exemption for family owned farms and businesses
increased to $1.3 million. Protecting family owned farms and small
businesses is an issue that I have fought for and supported.
The estate tax has ended the lives of many family owned farms and
businesses. Increasing the exemption will help keep the farm or
business in the family.
I am also proud of the effort by Democrats to improve this bill. If
it wasn't for Democrats demanding fairness, many families making under
$30,000 a year would not have been eligible for the child tax credit.
We also would not see child health care, higher education scholarships,
and tuition tax credits included in this legislation if Democrats had
not fought for them.
This tax relief bill will not explode the deficit in future years as
the original House Republican bill would have.
This is not a perfect legislative package and it does not solve all
of our long-term fiscal issues. It will reduce the deficit by $700
billion over 10 years and bring the Federal budget into balance by
2002.
It is the product of genuine bipartisan efforts. The Congress and
President did what the American people have been demadning--put aside
politics and balance the budget in a fair and responsible manner.
My hope is that Congress will followup this successful effort by
passing a balanced budget amendment to the Constitution to ensure that
we will have a balanced budget not just for 1 year but for all future
generations.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
California [Mr. Capps].

{time} 1315

Mr. CAPPS. Mr. Speaker, I rise in strong support of this legislation.
This bill will cut taxes for millions of Americans while balancing the
budget and protecting our critical investments in education and health
care.
In particular, I am in strong support of the immediate increase in
the exemption from estate taxes for family farmers and small business
owners. In my district on the central coast of California farm and
ranch families face the triple threat of high estate taxes, rising land
values and suburban development. This combination threatens a special
way of life and a matchless environment. Our action today will help us
keep family farms and businesses where they belong, in the family and
not on the auction block.
I also support the education tax credits in this bill and commend the
President in particular for his leadership on this issue. As a teacher,
I know firsthand the priceless value of education. The HOPE
scholarships will open the door of education to families on the central
coast where we have the great universities and excellent 2-year
colleges.
It is no secret that education benefits the entire economy, but it
also uplifts the spirit and creates a more civil society, and I urge my
colleagues to support this legislation.
Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
I just wanted to repeat for a few of my colleagues who were not here
before that, in addition to the patent unfairness of this bill, which
is obvious from the charts, that the top 5 percent are getting 44
percent of the breaks. And when my colleagues on the other side suggest
that the middle class is getting most of the breaks, they are just
taking the first 5 years, they are not looking at the whole 10 years.
The fact is that the poorest people in this country are getting
nothing out of this and the richest are getting an average of $16,000.
But then there are the owners of Amway Corporation, and I was wrong, I
misspoke, they gave two $500,000 checks to the Republican Party, and
there is a tax break in here totaling $280 million for their Asian
subsidiaries.
So if one invests a million bucks in the Republicans, they can get
$280 million back in special hidden tax breaks.
In this bill Sammon Enterprises in Texas, at the last hour, in the
Speaker's office, $23 million to one company in Texas. Twenty-three
million bucks. That is more than all the people in my district make in
a year, Mr. Speaker. Ten times more going to one Texan. I wonder how
much money old man Sammon kicked into the Republican Party. It will be
interesting to find out.
The beet king in Texas, Simmons, I did not realize what he got. He is
getting $104 million, a gift from the Republicans in this tax bill,
which is hidden here in the documents which never were explained to any
of us.
This borders on the criminal. And when we talk about investigations
as to whether the Vice President was in some Ashram someplace and got
money, what went on in the Speaker's office when the chairman of the
Committee on Ways and Means and the Speaker and the high-knockers in
the Republican leadership were cutting deals to pay back big
contributors? That is what we ought to find out that is going on in
this bill.
I have a page here that lists all of the rifle shots. My goodness,
here, ``relating to transition rule for instruments described in a
ruling request submitted to the Internal Revenue Service on or before
June 8, 1997.'' Does not tell us the name, does not tell us the money,
but I will bet it is somebody's buddy who kicked in big to the
Republicans.
Here it is, section 1005(b). We will make this part of the Record,
Mr. Speaker. Here is ``relating to transition rule for instruments
described on or before June 8, 1997, in a public announcement or in a
filing.''
I want to tell my colleagues, those are provisions, page after page,
for individuals who are getting special slush out of this tax bill
while lower income Americans are going to pay $40 more a year.
Mr. Speaker, the material I quoted from above is submitted herewith:

Memorandum

To: Honorable Bill Archer, Honorable John Kasich, Honorable
Philip M. Crane, Honorable William M. Thomas, Honorable
Richard K. Armey, Honorable Tom DeLay, Honorable Charles
B. Rangel, Honorable Jim McDermott, Honorable Fortney
Pete Stark, Senator William V. Roth, Jr., Senator Pete V.
Domenici, Senator Trent Lott, Senator Charles E.
Grassley, Senator Kent Conrad, Senator Don Nickles,
Senator Daniel Patrick Moynihan, Senator Frank R.
Lautenberg, Honorable Robert T. Matsui.
From: Kenneth J. Kies.
Subject: Provisions in H.R. 2014 which are subject to the
line item veto.
The Line Item Veto Act (Pub. Law 104-130) (the ``Act''),
amended the Congressional Budget and Impoundment Act of 1974
to grant the President the limited authority to cancel
specific dollar amounts of discretionary budget authority,
certain new direct spending, and limited tax benefits. The
Act provides that the Joint Committee on Taxation (the
``Joint Committee'') is required to examine any revenue or
reconciliation bill or joint resolution that amends the
Internal Revenue Code of 1986 prior to its filing by a
conference committee in order to determine whether or not the
bill or joint resolution contains any limited tax benefits.
The Act also requires the Joint Committee to provide a
statement to the conference committee that either (1)
identifies each limited tax benefit contained in the bill or
resolution, or (2) declares that the bill or resolution
contains no limited tax benefits. The Act provides that the
statement provided to the conferees must be made available to
any Member of Congress by the Joint Committee on Taxation
immediately upon request.
The Act provides that the conferees determine whether or
not to include the Joint Committee's statement in the
conference report. If the conference report includes the
information from the Joint Committee on Taxation identifying
provisions that are limited tax benefits, then the President
may cancel one or more of those, but only those, provisions
that have been identified. If a conference report contains a
statement from the Joint Committee that none of the
provisions in the conference report are limited tax benefits,
then the President has no authority to cancel any of the
specific tax provisions, because there are no tax provisions
that are eligible for cancellation under the Act. If the

[[Page H6641]]

conference report does not include a statement from the Joint
Committee regarding limited tax benefits, then the President
determines which provisions are subject to cancellation under
the Act.
Pursuant to section 1027(a) of the Congressional Budget and
Impoundment Act of 1974 (as amended by the Line Item Veto
Act), attached is the statement of the Joint Committee on
Taxation regarding limited tax benefits contained in the
conference agreement on H.R. 2014.

Sec.--. Identification of Limited Tax Benefits Subject to Line Item
Veto

Section 1021(a)(3) of the Congressional Budget and
Impoundment Control Act of 1974 shall only apply to:
(1) Sec. 101(b) (relating to high risk pools permitted to
cover dependents of high risk individuals)
(2) Sec. 222 (relating to limitation on qualified 501(c)(3)
bonds other than hospital bonds)
(3) Sec. 224 (relating to contributions of computer
technology and equipment for elementary or secondary school
purposes)
(4) Sec. (relating to treatment of remainder interests for
purposes of provision relating to gain from sale of principal
residence)
(5) Sec. 501(b) (relating to indexing of alternative
valuation of certain farm, etc., real property)
(6) Sec. 503 (relating to modifications to rate of interest
on portion of estate tax extended under section 6166)
(7) Sec. 504 (relating to extension of treatment of certain
rents under section 2032A to lineal descendants)
(8) Sec. 508 (relating to treatment of land subject to
qualified conservation easement)
(9) Sec. 511 (relating to expansion of exception from
generation-skipping transfer tax for transfers to individuals
with deceased parents)
(10) Sec. 601 (relating to the research tax credit)
(11) Sec. 602 (relating to contributions of stock to
private foundations)
(12) Sec. 603 (relating to the work opportunity tax credit)
(13) Sec. 604 (relating to orphan drug tax credit)
(14) Sec. 701 (relating to incentives for revitalization of
the District of Columbia) to the extent it amends the
Internal Revenue Code of 1986 to create sections 1400 and
1400A (relating to tax-exempt economic development bonds)
(15) Sec. 701 (relating to incentives for revitalization of
the District of Columbia) to the extent it amends the
Internal Revenue Code of 1986 to create section 1400C
(relating to first-time homebuyer credit for District of
Columbia)
(16) Sec. 801 (relating to incentives for employing long-
term family assistance recipients)
(17) Sec. 904(b) (relating to uniform rate of tax on
vaccines) as it relates to any vaccine containing pertussis
bacteria, extracted or partial cell bacteria, or specific
pertussis antigens
(18) Sec. 904(b) (relating to uniform rate of tax on
vaccines) as it relates to any vaccine against measles
(19) Sec. 904(b) (relating to uniform rate of tax on
vaccines) as it relates to any vaccine against mumps
(20) Sec. 904(b) (relating to uniform rate of tax on
vaccines) as it relates to any vaccine against rubella
(21) Sec. 905 (relating to operators of multiple retail
gasoline outlets treated as wholesale distributors for refund
purposes)
(22) Sec. 906 (relating to exemption of electric and other
clean-fuel motor vehicles from luxury automobile
classification)
(23) Sec. 907(a) (relating to rate of tax on liquefied
natural gas determined on basis of BTU equivalency with
gasoline)
(24) Sec. 907(b) (relating to rate of tax on methanol from
natural gas determined on basis of BTU equivalency with
gasoline)
(25) Sec. 908 (relating to modification of tax treatment of
hard cider)
(26) Sec. 914 (relating to mortgage financing for
residences located in disaster areas)
(27) Sec. 952 (relating to assignment of workmen's
compensation liability eligible for exclusion relating to
personal injury liability assignments)
(28) Sec. 953 (relating to tax-exempt status for certain
State worker's compensation act companies)
(29) Sec. 957 (relating to additional advance refunding of
certain Virgin Island bonds)
(30) Sec. 958 (relating to nonrecognition of gain on sale
of stock to certain farmers' cooperatives)
(31) Sec. 961 (relating to exemption of the incremental
cost of a clean fuel vehicle from the limits on depreciation
for vehicles)
(32) Sec. 964 (relating to clarification of treatment of
certain receivables purchased by cooperative hospital service
organizations)
(33) Sec. 966 (relating to deduction in computing adjusted
gross income for expenses in connection with service
performed by certain officials) with respect to taxable years
beginning before 1991
(34) Sec. 968 (relating to elective carryback of existing
carryovers of National Railroad Passenger Corporation)
(35) Sec. 1005(b)(2)(B) (relating to transition rule for
instruments described in a ruling request submitted to the
Internal Revenue Service on or before June 8, 1997)
(36) Sec. 1005(b)(2)(C) (relating to transition rule for
instruments described on or before June 8, 1997, in a public
announcement or in a filing with the Securities and Exchange
Commission) as it relates to a public announcement
(37) Sec. 1005(b)(2)(C) (relating to transition rule for
instruments described on or before June 8, 1997, in a public
announcement or in filing with the Securities and Exchange
Commission) as it relates to a filing with the Securities and
Exchange Commission
(38) Sec. 1011(d)(2)(B) (relating to transition rule for
distributions made pursuant to the terms of a tender offer
outstanding on May 3, 1995)
(39) Sec. 1011(d)(3) (relating to transition rule for
distributions made pursuant to the terms of a tender offer
outstanding on September 13, 1995)
(40) Sec. 1012(d)(3)(B) (relating to transition rule for
distributions pursuant to an acquisition described in section
355(e)(2)(A)(ii) of the Internal Revenue Code of 1986
described in a ruling request submitted to the Internal
Revenue Service on or before April 16, 1997)
(41) Sec. 1012(d)(3)(C) (relating to transition rule for
distributions pursuant to an acquisition described in section
355(e)(2)(A)(ii) of the Internal Revenue Code of 1986
described in a public announcement or filing with the
Securities and Exchange Commission) as it relates to a public
announcement
(42) Sec. 1012(d)(3)(C) (relating to transition rule for
distributions pursuant to an acquisition described in section
355(e)(2)(A)(ii) of the Internal Revenue Code of 1986
described in a public announcement or filing with the
Securities and Exchange Commission) as it relates to a filing
with the Securities and Exchange Commission
(43) Sec. 1013(d)(2)(B) (relating to transition rule for
distributions or acquisitions after June 8, 1997, described
in a ruling request submitted to the Internal Revenue Service
submitted on or before June 8, 1997)
(44) Sec. 1013(d)(2)(C) (relating to transition rule for
distributions or acquisitions after June 8, 1997, described
in a public announcement or filing with the Securities and
Exchange Commission on or before June 8, 1997) as it relates
to a public announcement
(45) Sec. 1013(d)(2)(C) (relating to transition rule for
distributions or acquisitions after June 8, 1997, described
in a public announcement or filing with the Securities and
Exchange Commission on or before June 8, 1997) as it relates
to a filing with the Securities and Exchange Commission
(46) Sec. 1014(f)(2)(B) (relating to transition rule for
any transaction after June 8, 1997, if such transaction is
described in a ruling request submitted to the Internal
Revenue Service on or before June 8, 1997)
(47) Sec. 1014(f)(2)(C) (relating to transition rule for
any transaction after June 8, 1997, if such transaction is
described in a public announcement or filing with the
Securities and Exchange Commission on or before June 8, 1997)
as it relates to a public announcement
(48) Sec. 1014(f)(2)(C) (relating to transition rule for
any transaction after June 8, 1997, if such transaction is
described in a public announcement or filing with the
Securities and Exchange Commission on or before June 8, 1997)
as it relates to a filing with the Securities and Exchange
Commission
(49) Sec. 1044(b) (relating to special rules for provision
terminating certain exceptions from rules relating to exempt
organizations which provide commercial-type insurance)
(50) Sec. 1091(a) (relating to termination of suspense
accounts for family corporations required to use accrual
accounting) as it relates to the repeal of Internal Revenue
Code section 447(i)(3)
(51) Sec. 1089(b)(3)(B) (relating to special rule for
decedents dying before January 1, 1999)
(52) Sec. 1089(b)(3)(C) (relating to reformations)
(53) Sec. 1171 (relating to treatment of computer software
as FSC export property)
(54) Sec. 1175 (relating to exemption for active financing
income)
(55) Sec. 1204 (relating to travel expenses of Federal
employees doing criminal investigations)
(56) Sec. 1236 (relating to extension of time for filing a
request for administrative adjustment)
(57) Sec. 1243 (relating to special rules for
administrative adjustment request with respect to bad debts
or worthless securities)
(58) Sec. 1251 (relating to clarification on limitation on
maximum number of shareholders)
(59) Sec. 1253 (relating to attribution rules applicable to
tenant ownership)
(60) Sec. 1256 (relating to modification of earnings and
profits rules for determining whether REIT has earnings and
profits from non-REIT years)
(61) Sec. 1257 (relating to treatment of foreclosure
property)
(62) Sec. 1261 (relating to shared appreciation mortgages)
(63) Sec. 1302 (relating to clarification of waiver of
certain rights of recovery)
(64) Sec. 1303 (relating to transitional rule under section
2056A)
(65) Sec. 1304 (relating to treatment for estate tax
purposes of short-term obligations held by nonresident alien)
(66) Sec. 1311 (relating to clarification of treatment of
survivor annuities under qualified terminable interest rules)
(67) Sec. 1312 (relating to treatment of qualified domestic
trust rules of forms of ownership which are not trusts)
(68) Sec. 1313 (relating to opportunity to correct failures
under section 2032A)
(69) Sec. 1414 (relating to fermented material from any
brewery may be received at a distilled spirits plant)

[[Page H6642]]

(70) Sec. 1417 (relating to use of additional ameliorating
material in certain wines)
(71) Sec. 1418 (relating to domestically produced beer may
be withdrawn free of tax for use of foreign embassies,
legations, etc.)
(72) Sec. 1421 (relating to transfer to brewery of beer
imported in bulk without payment of tax)
(73) Sec. 1422 (relating to transfer to bonded wine cellars
of wine imported in bulk without payment of tax)
(74) Sec. 1506 (relating to clarification of certain rules
relating to employee stock ownership plans of S corporations)
(75) Sec. 1507 (relating to modification of 10 percent tax
for nondeductible contributions)
(76) Sec. 1523 (relating to repeal of application of
unrelated business income tax to ESOPs)
(77) Sec. (relating to gratuitous transfer for the benefit
of employees)
(78) Sec. 1532 (relating to special rules relating to
church plans)
(79) Sec. 1604(c)(2) (relating to amendment related to
Omnibus Budget Reconciliation Act of 1993)

spending bill provision

(1) Sec. (FUTA exemption for prisoners)
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentleman from
Florida [Mr. Weldon].
Mr. WELDON of Florida. Mr. Speaker, I thank the gentleman for
yielding me this time, and I congratulate the chairman of the committee
for the good work he did in this tax cut.
I would like to talk a little bit about reality, who is going to
benefit from this tax cut. This is a family in my district, the Auger
family. We have here Jim and Donna. He is a plumber, she cuts hair.
Here are their three kids: Christopher, the oldest, Anthony, and Danae,
the young girl. They are going to get $1,500 of reduction in their
taxes for the $500-per-child tax credit times three.
When this young man is in college in about 3 years, they will get
$1,500 of tax reduction. They will still get the $500 per child tax
credit for these two. This is flesh and blood. These are real middle
class families.
Do not believe the lies that this is a tax cut for the rich. This is
a tax cut for the middle class. It is a Republican tax cut. It would
have never happened if it were not for the election in 1994 and the
persistence of the gentleman from Georgia, Mr. Newt Gingrich, and the
gentleman from Texas Mr. Bill Archer. I encourage all my colleagues on
both sides of the aisle to vote for it.
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentleman from
Pennsylvania [Mr. Gekas].
(Mr. GEKAS asked and was given permission to revise and extend his
remarks.)
Mr. GEKAS. Mr. Speaker, I thank the gentleman for yielding me this
time.
In 1986 many of us voted against the then tax reform bill because it
swept away, with one bill, capital gains and some other attractive
features of that code.
One of them has been restored in this bill, and it makes my farmers
and other colleagues' farmers rejoice. Earned income averaging, which
was a part of the 1986, but swept away, is now restored.
This means our farmers, who experience a drought in 1 year and have
minimal profits can balance that loss against a bumper crop that might
happen the next year. This was an excellent feature on which our
farmers relied prior to 1986. Now we can be happy to report that it has
been restored in the current tax bill.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from Maine
[Mr. Baldacci].
(Mr. BALDACCI asked and was given permission to revise and extend his
remarks.)
Mr. BALDACCI. Mr. Speaker, first of all, before the time begins, I
would like to thank the ranking member, the gentleman from New York
[Mr. Rangel], for his leadership, and the gentleman from South Carolina
[Mr. Spratt].
Mr. Speaker, in 1993 a major piece of legislation was passed, and at
that time it was being criticized roundly in both Chambers of this
Congress. In fact, one senior Member, in leadership now in the other
body, had referred to the fact that if he was wrong about what was
going to happen, that he would be the first one to take the hammer and
chisel and put President Clinton's face on Mt. Rushmore.
Since 1993, Mr. Speaker, we have had 5 years in a row of deficit
reductions. With reinventing and streamlining the Federal Government,
we are at the lowest number of Federal employees since the 1960's.
Because of the hard work done by President Clinton and Vice President
Gore and the Democrats in Congress, we are at a point where we are
going to be able to build a bridge to the 21st century, where we are
going to focus on children's health, on working families and we will
reward ``work'' and not ``not work''. We are going to make sure that
families, family businesses, and farms have the breaks that they
deserve.
All the hard work that has gone on to get to this particular point is
a credit to those that have served and passed that legislation.
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentleman from
South Dakota [Mr. Thune].
Mr. THUNE. Mr. Speaker, I thank the gentleman from Georgia [Mr.
Collins] for yielding me this time.
I want to point out today that I believe what we are hearing on the
floor today is liberalism's last gasp. It is no wonder we are seeing
some of our friends on the other side of the aisle having a hard time
containing their disappointment, because liberals always look at things
in terms of winners and losers. But we have a bill here where the
American people are the winners.
The people of this country, Democrats and Republicans, who have come
together to do something that is very much in the best interest for the
future of this country, because it gives people more control over their
economic future, that is really what this is about.
The State I come from, the State of South Dakota, there are so many
things in here that will help rural areas of this country. Look at
agriculture, estate taxes, capital gains, the family tax credit, income
averaging, and deductibility of health insurance premiums. These are
all things that will benefit rural areas of this country.
So it is a project that I give credit to the gentleman from Texas
[Mr. Archer] and the members of the House Committee on Ways and Means
for something that was very difficult, and that is trying to drive a
Mack truck through a car wash; to get a lot of tax relief out of a
little bit of revenue. I think they have done a wonderful job, and I
hope my colleagues will support this bill today.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
California [Mr. Fazio], the Chair of the Democratic Caucus.
Mr. FAZIO of California. Mr. Speaker, those of us who are fighting
tooth and nail for working families are fortunate that with the strong
backing of Democrats in this House, who stood up and opposed the Archer
bill, President Clinton, as Phil Gramm has said, cleaned the clock of
Republicans in these negotiations.
The President and House Democrats fought for and won for families
like that of Debbie and John Ellis, who live in my district in
Woodland, CA. Debbie will make $29,000 this year as an office manager
for the California Highway Patrol. She is the mother of two boys. Her
21-year-old is working this summer to save enough money to attend
Sacramento City College this fall. Her 10-year-old, Joshua, is a
fourth-grader at the Woodland Christian School.
The Ellises will receive the college tax credit so their son can get
his degree, and they will be eligible for the new child tax credit,
which they say will be used to help them get their car repaired.
The Republicans would have denied this family and millions of others
just like them tax relief this year. In fact, providing tax relief for
these hard working families was called, and I quote, welfare. What an
insult.
Mr. Speaker, I want to thank the gentleman from New York, Mr. Charlie
Rangel, and President Clinton for hanging tough in these budget
negotiations and for fighting for working families. Because of this
debate, the American people know who is on their side, and I think they
will remember that.
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentlewoman from
Texas, [Ms. Granger].
Ms. GRANGER. Mr. Speaker, as President, one of Ronald Reagan's
favorite things to do everyday was to read the mail. Sometimes he would
write out personal responses, but usually he just liked to read what
the American people were saying.
One Friday afternoon, as Mr. Reagan was leaving for Camp David, his
director of correspondence, Anne Higgins,

[[Page H6643]]

gave him a stack of letters to read. Included in the stack was a very
angry letter from an extremely upset Democrat in New Jersey.
Next Monday morning, when Anne returned to her office, she noticed
Mr. Reagan had returned this particular letter to her desk. Attached
was a note from the President which read, ``Dear Anne, don't worry
about writing this lady back. I called her on the phone. We are friends
now.''
Mr. Speaker, is it not amazing what can happen when honest people
engage in an honest discussion on the issues? Fear gives way to faith
and fiction is replaced with the facts.
In the past few days, the Congress and the White House have been able
to look for common ground and listen to common sense, and the American
people are going to be very pleased with the results.
The facts are this tax bill opens doors of opportunity by closing
loopholes and exemptions. The facts are this tax bill raises hope
everywhere by lowering taxes for everyone. And the facts are our tax
bill is not designed to help folks with a corner on the market, it is
designed to help folks with a market on the corner, a market not on
Wall Street, New York, but on main streets across America.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Maryland [Mr. Wynn].

{time} 1300

Mr. WYNN. Mr. Speaker, I thank the gentleman from New York [Mr.
Rangel] for yielding and for his leadership during this process, as
well as I would like to take this opportunity to thank the gentleman
from South Carolina [Mr. Spratt], our ranking member on the Committee
on the Budget. They did a good job.
This is a good bill, and I intend to support it. It is not a perfect
bill. There are legitimate criticisms. The rich still get richer. But
the fact of the matter is, we cannot let the perfect be the enemy of
the good, and this is a good bill. It provides tax relief that my
constituents in Maryland can use. They can use a child tax credit
because they are trying to put young people through college so they can
get better jobs. They can certainly use a child tax credit so that they
can buy necessities, perhaps fix a car, perhaps buy clothes for a
child, perhaps simply buy groceries.
This is not going to solve all the problems of the world, but it is
an important movement in the right direction. We can remain here and
bicker and try to make this a better bill, or we could pass this bill
and begin sending child tax relief to needy families, sending education
tax credits to people who want to get higher education, and also giving
a break to those people who invest in our people through a capital-
gains break. It is a balanced bill. It is a good bill. I hope my
colleagues will support it.
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentleman from
Virginia [Mr. Bliley].
(Mr. BLILEY asked and was given permission to revise and extend his
remarks.)
Mr. BLILEY. Mr. Speaker, I thank the gentleman from Georgia [Mr.
Collins] for yielding me the time.
Mr. Speaker, I am proud today to rise in support of the Taxpayer
Relief Act. Just a few years ago, the concept of balancing the budget
while cutting taxes was thought to be impossible. The truth was,
though, that this concept was nothing more than a myth propagated by
the extreme left, who had more faith in the decisions of Government
bureaucrats than in the American people. Today I rise in support of the
first comprehensive tax cut in more than 15 years.
I want to touch on two important provisions in this tax bill which
are very important to my constituents, death tax relief and capital
gains relief. Did my colleagues know that the IRS considers the death
taxes a tax on the privilege of leaving the fruits of their labors to
their children? Something is wrong in America when a tax collecting
agency thinks that giving our children the family farm is a privilege.
Let me be the first to tell the IRS that in America giving our children
what we earn should be a right, not a privilege.
While I support doing away with death taxes entirely, this bill makes
an important first step.
Mr. RANGEL. Mr. Speaker, I think that, if the time is correct, my
colleagues have double the time that we have. It might be better if we
tried two-to-one at this time.
The SPEAKER pro tempore [Mr. LaHood]. The gentleman from Georgia [Mr.
Collins] has 58 minutes remaining. The gentleman from New York [Mr.
Rangel] has 34\1/2\ minutes remaining. The gentleman from California
[Mr. Stark] has 2\1/2\ minutes remaining.
So the gentleman from New York [Mr. Rangel] is correct.
Mr. COLLINS. Mr. Speaker, I yield 1 minute to the gentleman from New
York [Mr. Forbes].
(Mr. FORBES asked and was given permission to revise and extend his
remarks.)
Mr. FORBES. Mr. Speaker, only in political Washington would a mom and
dad, or both, working and earning about $40,000 in their family, be
considered wealthy.
I want to congratulate the Republican chairman of the Committee on
Ways and Means and all the members of the Committee on Ways and Means
for helping to put together a responsible bill. For the first time in
15 years, we are going to enjoy some tax relief.
For the American people saying ``What is the big deal? You should
have been here years ago?'' but to give $500 per child tax relief, to
provide educational incentives, to make sure that the largest
investment to most families, their family residence, they do not get
taxed by Uncle Sam, they will get the relief of up to $500,000, that is
good. To provide for job-creating capital gains relief and small
business exemptions, up to 100-percent exemption for small businesses
paying health care premiums, protection from estate taxes of $1.3
million, for family farms and for small businesses, this is the right
thing to do.
Some $600 billion the Democrat Congress took away from the American
people in the early 1990's. To give $94 billion back is not only the
right thing, it is long overdue. I commend my colleagues for their hard
work.
Mr. COLLINS. Mr. Speaker, I yield 3 minutes to the gentleman from
Kentucky [Mr. Bunning], the distinguished member of the Committee on
Ways and Means and chairman of the Subcommittee on Social Security.
(Mr. BUNNING asked and was given permission to revise and extend his
remarks.)
Mr. BUNNING. Mr. Speaker, I rise in strong support of H.R. 2014, the
Taxpayer Relief Act. What a difference a few years makes. Just 4 years
ago, without a single vote, the Democrat Congress passed a $260-billion
tax increase as part of the 1993 Clinton tax bill, the largest tax
increase in dollars in our history.
Today we vote to cut taxes by about $275 billion over a 10-year
period. I think it is fantastic that we have been able to turn around
the thinking that goes on in Washington, DC. We absolutely believe that
there is going to be an awful lot of people on both sides of the aisle
that will support this bill. Because it is good for America, it is good
for the ordinary taxpaying person, it is good for kids, it has got so
many things that we have worked so hard on that I think America
prospers because of this bill.
Let us just talk about people that have gone to schools, gone to
college and are paying off their student loans. For those, this bill
allows those who are paying off student loans to deduct up to $2500
annually in interest expenses. I do not think anybody has talked about
that before.
This provision is estimated to provide $2.4 billion in tax relief
over the next 10 years. A second provision of the bill that makes it
easier for students to enroll in Kentucky's prepaid college tuition
program, to pay for room and board, as well as tuition. Over 2600
Kentucky students have already set up savings accounts and accrue about
$500,000 to help pay for college. This bill allows them to use that for
tuition and room and board.
I am a little disappointed that the final bill does not provide as
much tax relief for withdrawal from these plans as proposed. But we do
not get everything in every tax bill. This tax bill has all kinds of
relief for the average American taxpayer, the taxpayer between $20,000
and $75,000. Those are the people that want relief. The tax credit

[[Page H6644]]

for children, the estate tax, or death tax, whatever you want to call
it, we give relief there. For anybody who has a family farm or a small
business, we have an extra special tax relief, up to $1.3 million. But
the $500 tax credit is the key to this bill.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from North
Carolina [Mr. Price].
(Mr. PRICE of North Carolina asked and was given permission to revise
and extend his remarks.)
Mr. PRICE of North Carolina. Mr. Speaker, the bill before us has many
positive features for working and middle-class families. But I am
personally proudest of the inclusion of the main provisions of the
Education Affordability Act, introduced by the gentleman from North
Carolina [Mr. Etheridge] and myself and cosponsored by a bipartisan
group of 56 colleagues. These provisions will restore income tax
deductibility of interest on student loans and permit penalty-free
withdrawals of IRA savings for educational expenses--common sense ideas
to make higher education more accessible for American families.
Today is the culmination of an effort former Representative Martin
Lancaster and I began some 10 years ago, soon after we first came to
the Congress. We said then that if you can deduct the interest on your
home mortgage or even on a second home at the beach, you surely ought
to be able to deduct interest on something as basic as a student loan.
That is still true today, and I am proud to see it recognized in this
tax bill.
There is more good news in this bill for Americans seeking to get the
training the modern workplace requires, especially the Hope Scholarship
which will provide a $1,500 tax credit for the first 2 years past high
school and a 20-percent credit for succeeding years.
I am also pleased that this conference agreement removes the
notorious tax on the tuition waivers earned by graduate students that
was included in the House-passed bill. Students in my district and
across the country raised their voices in justified protest, and this
bill shows that their voices have been heard.
Mr. Speaker, this bill will expand opportunity for America's young
people and workers upgrading their skills. It will help give our
country the trained workforce the global economy demands.
Through supporting this conference report, we are putting our fiscal
house in order, we are investing in our people, and we are affording
tax relief for hard-pressed working families. That is a winning formula
for our country, and I urge my colleagues to vote ``aye.''
Mr. COLLINS. Mr. Speaker, I yield 2 minutes to the gentleman from
Illinois [Mr. Hastert].
(MR. HASTERT asked and was given permission to revise and extend his
remarks.)
Mr. HASTERT. Mr. Speaker, I thank the gentleman from Georgia [Mr.
Collins] for yielding me the time.
What a wonderful victory for the American people, the working
American family, people who have children, people who have to try to
move around this country and find the best job and the best way they
can provide for their families. They get to take a $400 tax credit next
year. They begin to take the deductions next January on that tax credit
per child.
My colleagues, they also can start to say, ``If I have to move and I
have to sell my house, I do not have to calculate not to carry forward
until I am 55 years of age, but I can take that capital gains now.''
What a wonderful opportunity for people to find the best job, the best
venue to raise their children.
What this really means is that American families can start to make
the decisions how they can spend extra dollars in their pocket. That
$500 tax credit per child is in their pocket now. They will decide how
to spend that instead of some Federal bureaucrat.
What does that mean? Well, when we spend our own money, we get to
grow the economy, we do not have to decide on some Federal executive or
Federal bureaucrat on how they are going to grow government, bigger
government, bigger cost, bigger spending. This is a double win for the
American family.
Is this bill perfect? Oh, I do not think it is perfect. But is it
good? Yes, it is a good bill. And does it mean that we are not going to
be back here next year with another bill and try to improve the
climate, the economic climate for our American families and American
workers? I think we can do that.
But my colleagues, I have to commend the chairman of the Committee on
Ways and Means, I have to commend the people who worked in the
leadership in this body, and the President. This is a wonderful first
step.
Mr. COLLINS. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman
from California [Mr. Riggs].
Mr. RIGGS. Mr. Speaker, I thank the gentleman from Georgia [Mr.
Collins] for yielding, and I want to congratulate him and the other
members of the Committee on Ways and Means and the budget negotiators
for crafting a much needed, long overdue bipartisan bill to provide tax
relief to hard-pressed American families and businesses.
However, I do take exception to one aspect of these negotiations, and
that is the last-minute decision by the President to threaten to veto
the bill if education individual retirement accounts stayed in the
bill. The President issued a last-minute veto threat unless these
provisions were stripped out of the bill we will be voting on later
today.
This is good, sound policy put forward by the other body, a provision
that would allow parents to set up education retirement accounts, or
education IRAs, which could be contributed to with the contributions
earning interest tax-free as long as the deductions from the account
were used for educational expenses like tuition, fees, tutoring, books,
supplies, home computers, and any other qualified expense.
The idea behind it, of course, is to allow parents to set aside money
for their children's education at any school, any school, public,
private, parochial, or home, from kindergarten through college.
But what does the President say in his veto threat? He says that ``I
would veto any tax package that would undermine public education by
providing tax benefits for private and parochial school expenses.''
It is a sad day to see the President side with the opponents of real
educational reform and the defenders of the status quo. School choice,
colleagues, parental choice in education, is working. We are getting
testimony. I chair the education subcommittee in the House. We are
hearing from people who want, we are hearing from parents who want the
ability, the choice to send their children to the school that is best
for their child.
Here is an article from the Washington Times from this week, July 28.
Black support. Support in the African-American community. Risers for
school vouchers. Here is Paul Peterson up at Harvard, one of the first
people to study parental choice in public education today, looking at
the low-income school choice demonstration projects in Milwaukee and
Cleveland and concluding that the results, and I quote now, ``indicate
that Congress should approve legislation initiating additional
experiments in other cities, including Washington, to determine whether
this school reform, parental choice in public education, should be
introduced nationally.''
So my colleagues, I am real disappointed to see this provision
stripped out in the face of the President's veto threat. Parents should
have the right to send their children to the school of their choice,
the school that is best for their children. After all, it is their
money, it is their children, and it is their future.

{time} 1345

Mr. RANGEL. The gentleman should be reminded that it was the
Republicans that agreed to drop that provision.
Mr. Speaker, I yield 2 minutes to the gentlewoman from Florida [Mrs.
Thurman] a member of the Committee on Ways and Means.
Mrs. THURMAN. Mr. Speaker, I thank the gentleman from New York [Mr.
Rangel] for yielding me this time. I rise today in strong support of
this conference agreement. I would like to point out that many of its
best provisions were conceived, I believe, in 1996 as part of the
Democratic families first agenda. Democrats said we had to finish what
we began in 1993 with the largest deficit reduction package ever
enacted and the only one that has worked. This bill will balance the
budget once and for all.

[[Page H6645]]

We committed ourselves to expanding health care for children; 5
million children will get health insurance because of this bill.
We said hard-working families must get help with the cost of college
education. Millions of families will be able to afford college because
of this HOPE scholarship and other initiatives in this bill.
In Florida's Fifth District, the average median household income is
about $21,000 a year. The capital gains provision in this bill will
help thousands of seniors in my district who have their nesteggs
invested in mutual funds.
The farming families and small business owners will be able to hold
onto their farms and businesses after the death of a loved one because
of the estate tax relief contained in this bill.
And families of public safety officers slain in the line of duty will
receive their survivor benefits tax free for the first time.
This is a family bill. Hardworking middle class families will enjoy
the benefit of the child tax credit and the largest education
initiative in a generation. But most of all, we all will enjoy the
benefit of a balanced budget by the year 2002.
Mr. COLLINS. Mr. Speaker, I yield 3 minutes to the distinguished
gentleman from Iowa [Mr. Leach].
Mr. LEACH. Mr. Speaker, I would like to offer a perspective from my
State of Iowa on the important work of the House today.
It is my belief that few tax changes ever contemplated by Congress
fit the rural economy as well as this one. Of particular import is the
$500-per-child tax credit; the Archer capital gains cut, 20-year
deferred payment contracts for family farms and small businesses for
estates; 100 percent deductibility for self-employed individuals for
health care cost; 3-year income averaging for farmers; and an increase
in the inheritance exemption from $600,000 to $1 million and to $1.3
million for closely-held businesses and family farms, which is a
potential total inheritance deduction of $2.6 million if both spouses
are able to participate. The effect of all of this is that for the
first time in the last half century, many Iowa farmers will be allowed
to transfer their farms to their children virtually inheritance tax
free.
On the education front, with the exception of the revocation of tax-
exempt status for TIAA-CREF, this legislation is a strong step forward
for the education community. For the first time in over 10 years,
students will be able to deduct a major part of interest accumulated on
their student loans. In addition, the tax exemption for employer-
provided undergraduate education assistance is extended for 3 years,
and a HOPE tax credit is created to assist students and their families
with out-of-pocket expenses associated with college attendance.
This economic package is beneficial for the rural economy, good for
higher education and is put in place within the context of balancing
the budget by 2002 if conservative economic growth principles are
assumed, and perhaps sooner if the economy continues to grow at or near
its current rate.
Mr. ARCHER. Mr. Speaker, I yield such time as he may consume to the
gentleman from Oklahoma [Mr. Watkins].
Mr. WATKINS. Mr. Speaker, I rise for two reasons, one to express my
support and how great a day I think this is for the American people, to
realize that we finally have worked to where we are all in agreement in
a bipartisan way to have a balanced budget for the first time in nearly
30 years and also to have tax cuts for the first time in 16 years. I am
excited about it because I am very much a pro-growth economic
development type of person. I know we have got a lot to do in order to
prepare an economy for the 21st century, the global competitive economy
that our children and grandchildren will have to compete. I want to
make sure that no one is left behind.
Mr. Speaker, in the bill, as the chairman of the committee well
knows, the Senate receded to the House provision in conference dealing
with Native Americans in Oklahoma. However, I believe it is essential
we clarify the congressional intent. After meeting with the gentleman
from Texas, along with Senator Nickles and the staff of the Committee
on Ways and Means and the Senate Committee on Finance and the Joint
Committee on Taxation and the Senate Committee on Indian Affairs, the
Department of Interior, the Bureau of Indian Affairs and many others,
it was concluded it was necessary to create kind of a ``bright-line''
test for determining which Oklahoma lands qualify for section 168(j) to
avoid first costly litigation, and also to clearly define the language
that is in the House bill which says the ``lands in Oklahoma within the
judicial area of an Oklahoma Indian tribe,'' to make sure it means for
purposes of this legislation ``lands within boundaries of the last
treaties with the Oklahoma tribes.'' This definition narrows the land
area compared with the current law by eliminating the unassigned lands.
Because I believe it is important that we clarify this matter, I
would ask if the chairman of the Committee on Ways and Means concurs
with this explanation.
Mr. ARCHER. Mr. Speaker, will the gentleman yield?
Mr. WATKINS. I yield to the gentleman from Texas.
Mr. ARCHER. The gentleman from Oklahoma is correct. The Oklahoma
Indian lands clarification in this bill does narrow the scope of
section 168(j) in Oklahoma compared to current law by eliminating the
unassigned lands. I thank the gentleman for his cooperation on this
issue.
Mr. WATKINS. I appreciate the cooperation of the chairman and also
the cooperation of the ranking member. I have worked with the gentleman
from New York also on many occasions in the past, and it is always
great to be working in a bipartisan spirit to help all of our people. I
thank the gentleman from Texas [Mr. Archer] and the gentleman from New
York [Mr. Rangel] and ask that the total text of my statement be added
for the Record.
Mr. Speaker, the chairman of the House Ways and Means Committee and
his staff have worked closely with me on a provision in this bill to
clarify the application of section 168(j) of the Internal Revenue Code
to Indian lands in Oklahoma.
Section 168(j) was enacted in 1993 to provide accelerated
depreciation for property placed in service on Indian reservations,
including former Indian reservations in Oklahoma. The House of
Representatives included a provision in this tax bill that provides
that lands in Oklahoma within the jurisdictional area of an Oklahoma
Indian tribe and eligible for trust-land status would qualify for
section 168(j).
As the chairman knows, the Senate receded to the House provision in
conference. However, since the House leaves the interpretation of the
provision to the U.S. Department of the Interior, I believe it is
essential we clarify congressional intent.
After my meetings with you, Mr. Chairman, and meetings with Senator
Nickles, Ways and Means and Finance Committee staff, Joint Tax
Committee, Senate Indian Affairs Committee, Department of the Interior,
and the Bureau of Indian Affairs on this issue, it was concluded
necessary to create a bright-line test for determining which Oklahoma
lands qualify for section 168(j). This bright-line test is needed to
avoid costly litigation and clearly define the language ``lands in
Oklahoma within the jurisdictional area of an Oklahoma Indian tribe''
to mean for the purposes of this legislation ``lands within boundaries
of the last treaties with the Oklahoma tribes.'' This definition
narrows the land area compared with current law by eliminating the
unassigned lands.
Because I believe it is important that we clarify this matter, does
the chairman of the House Ways and Means Committee concur with my
explanation?
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas [Mr. Stenholm] who has been so helpful in bringing this all
together.
(Mr. STENHOLM asked and was given permission to revise and extend his
remarks.)
Mr. STENHOLM. Mr. Speaker, I want to first begin by commending the
gentleman from Texas [Mr. Archer], the chairman, the gentleman from New
York [Mr. Rangel], the ranking member, and the President of the United
States for their work in putting together this conference report which
I urge everyone to support today. As so often happens in the
legislative process, it is not a perfect document but certainly when we
compare this bill with that which originally passed the House of
Representatives, there are many significant improvements, one of which
is in the area of the child tax credit, a debate that occurred that was
truly amazing to many, that those who were earning $25,000 a year and
also

[[Page H6646]]

working were not to be entitled to a tax credit; amazing that the
debate occurred, but it has been resolved in a very favorable way which
pleases 50 percent of the constituents of the 17th District of Texas
who find themselves in that income category.
In the area of the capital gains tax cut, one thing that was
recognized that I think will prove to be hopefully a goal for the
future is to recognize longer held investments should be entitled to
capital gains reductions, not necessarily the short term that provides
for speculation and quarterly report syndrome.
The estate tax relief, something that we advocated, the Blue Dogs and
others, glad to see now a $1.3 million estate tax relief for family
held businesses, as my colleague from Iowa a moment ago so eloquently
put.
Also when we look at the backloading, something that was very
concerning to those of us who are called deficit hawks, the concern of
the original House bill with indexation of capital gains, with backend
loading of IRA's, has been satisfactorily dealt with in a compromise
way, so much of our concerns there have been eliminated.
Some other very positive features. Moving to 100 percent deduction of
health insurance for self-employed, something that will be of
tremendous importance in our continued quest for a fair health system
for this country. Income averaging for farmers. Glad to see that is in
because that is something so important. And also the Hulshof-Stenholm
bill providing preferential tax treatment for farmer cooperatives that
purchase processing facilities, something that is a very good sign for
the future of agriculture.
Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from New
York [Mr. Solomon] the highly regarded, highly influential chairman of
the Committee on Rules.
Mr. SOLOMON. Mr. Speaker, I am embarrassed after that introduction by
the gentleman from Texas [Mr. Archer], but I am not embarrassed to
stand up here and hand out accolades to the gentleman from Texas [Mr.
Archer], the chairman. When the Speaker pro tempore and I were here way
back in the late 1970's, or I was and then he came in 1980 with Ronald
Reagan and the gentleman from Texas [Mr. Archer] was still here, this
country was on hard times. I was a businessman just before that, back
home, a small businessman. I recall having to make a corporate loan for
my company in which we paid 2 percent above the prime rate and that was
23.5 percent, to borrow money to expand our business.
23.5 percent. That was almost impossible. Inflation was running at
13.5 percent. It was really hard for people who were living on fixed
incomes. They just could not make it.
Then along came Ronald Reagan and he did what John F. Kennedy did
many years before that in 1962, and the gentleman and I and Chairman
Archer cut taxes, we stimulated the economy, and we had a roaring
economy for 8 years that created 17 million new jobs.
That is how important this bill is today. When we think about people
today and the very fact that two-thirds of the American people today
filing income taxes take some capital gains and of those two-thirds, 50
percent are older Americans living on fixed incomes, with incomes of
less than $40,000. In other words, $25,000, $35,000. That is how
important this is. Because that is bread and butter on the table of
those people who have worked all their lives but finally now have to
dip into their savings in order to make it, in order to maintain a
decent standard of living. That is how important this bill is today.
I just cannot tell Members how thrilled I am and how proud I am to be
a Republican, to be here today, to carry on that Ronald Reagan legacy
that we are going to establish here today, reestablish and carry on for
the next 10 years. I thank the chairman and the Speaker pro tempore for
all they have done in bringing this bill to the floor.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Hawaii [Mr. Abercrombie].
(Mr. ABERCROMBIE asked and was given permission to revise and extend
his remarks.)
Mr. ABERCROMBIE. Mr. Speaker, today I will support H.R. 2014, the
Taxpayer Relief Act.
Yet I cannot rise without sharing my greatest concern with the tax
bill, the airline ticket tax. The changes proposed in the airline
ticket tax will have an adverse effect on Hawaii's people and on our
economy. The segment portion of the domestic ticket tax is unfair. It
is particularly unfair to Hawaii where Aloha, Hawaiian, and Mahalo, our
local inter-island carriers, provide short-haul trips between the
islands. Our unique geography as an island chain makes air travel a
necessity. Unlike other areas of the country, we do not have a choice.
If individuals want to travel from island to island, we have to fly. In
order to make it economical for our people, Aloha, Hawaiian, and Mahalo
island hop. The domestic airline ticket tax shifts the burden to low-
cost, short-haul carriers. These are our local carriers and this will
hurt Hawaii.
The ticket tax increase on international flights from $6 to $24 is
another concern. Tourism is Hawaii's largest industry. It is a large
industry for many States of the Union. International visitors are a
vital part of our tourism industry.
Mr. Speaker, I will not dwell any further on the ticket tax except to
say that I will work with all my energy to repeal these provisions in
the future as we proceed to a tax bill next year.
Mr. Speaker, I rise today in support of H.R. 2014. The conference
report we are voting on today is an improvement over the version that
initially passed the House in June. I voted against that measure for a
number of reasons: It denied the full benefits of the child deduction
to hard-working, low-income taxpayers who avail themselves of the
earned income tax credit; it opened up enormous loopholes that would
have fully or partially excluded millions of American workers from the
protection of labor laws and fundamental benefits like Social Security
and worker compensation; and it short changed low and middle-income
taxpayers, denying them a fair share of its tax cuts.
The bill before us today remedies those deficiencies in whole or
large measure.
Yesterday, the House passed the spending bill that sets our Nation on
a path to have a balanced budget by 2002. The bill we are voting on
today provides tax relief for our citizens--tax relief that is paid
for.
We have arrived at this point because of the courageous vote taken in
1993. The 1993 budget agreement was a 5-year deficit reduction package.
It was a fiscally sound decision. As a result of the deficit reduction
package our Nation has a healthy economy.
Unfortunately, my constituents in Hawaii have not benefited from the
economic upswing to the same extent as the rest of the Nation. Hawaii
needs an economic stimulus. The balanced budget tax relief agreement we
are voting on today will help us. It is not a silver bullet, but it
will benefit a great many hard-pressed people and small businesses in
Hawaii.
I am voting for this bill not because it is perfect, but because on
the balance it helps working families and the middle class. It helps
the people of Hawaii.
The bill helps Hawaii families. It provides a child tax credit of
$400 a child in 1998 and increases to $500 a child thereafter for
children age 16 and under. The credit phases out for couples with
adjusted gross incomes of $110,000 and individuals with incomes of
$75,000.
The bill helps Hawaii college students. It provides a tax credit of
up to $1,500 a year for the first 2 years of college and a tax credit
of up to $1,000 for later years. Eligibility phases out for couples
with incomes between $80,000 and $100,000 and individuals with incomes
of between $50,000 and $60,000.
The bill helps Hawaii homeowners. Married couples may exclude up to
$500,000--single individuals may exclude up to $250,000--of capital
gains from the sale of a primary residence. In Hawaii, this provision
will be particularly helpful to residents whose principal investment is
their home.
The bill provides Hawaii with broad based capital gains reduction.
Capital gains come from the owning of assets such as stock, bonds,
homes, real estate, and businesses. The top capital gains tax rate
drops from 28 percent to 20 percent. This rate will drop further to 18
percent, effective in 2001, for individuals who hold assets for 5 years
or longer. For married couples with incomes less than $41,200 the
capital gains tax rate drops from 15 percent to 10 percent. The rate
will drop further to 8 percent, effective in 2001, for married couples
who currently earn less than $41,200 and who hold assets for 5 years or
longer.

[[Page H6647]]

The bill provides Hawaii with estate tax relief. The estate tax will
increase from the current $600,000 to $1 million. It will be phased in
over a 10-year period.
The bill provides Hawaii with expanded IRA--Individual Retirement
Account--opportunities. It creates new IRA Plus accounts. Contributions
are not deductible, but interest, dividends, and capital gains
accumulate tax free. Allows penalty free withdrawals for first time
home purchases. Further, withdrawals are tax free if the account is
held for at least 5 years and the account holder is at least 59\1/2\.
Income limits on traditional IRA's are raised.
The bill helps Hawaii small business. Self-employed small business
people will be able to deduct 100 percent of their health and insurance
costs--the current deduction is 40 percent, reinstates the home office
business deduction, and provides an immediate jump in the estate tax
threshold to $1.3 million--$2.6 million for couples--for small family
farms and businesses. This provision is important, because it enables
continued family ownership of small farms and businesses from one
generation to the next.
Yet, I cannot rise without sharing my greatest concern with the tax
bill: the airline ticket tax. The changes proposed in the airline
ticket tax will have an adverse affect on Hawaii's people and our
economy. The segment portion of the domestic ticket tax is unfair. It
is particularly unfair to Hawaii where Aloha, Hawaiian, and Mahalo, our
local interisland carriers, provide short-haul trips between the
islands. Our unique geography as an island chain makes air travel a
necessity. Unlike other areas of the country we do not have a choice.
If individuals want to travel from Island to island we have to fly. In
order to make it economical for our people Aloha, Hawaiian, and Mahalo
island hop. The domestic airline ticket tax shifts the burden to low-
cost short haul carriers. These are our local carriers. This will hurt
Hawaii.
The ticket tax increase on international flights from $6 to $24 is
another concern. Tourism is Hawaii's largest industry. International
visitors are a vital part of our tourism industry. The change in the
ticket tax on international flights puts a greater tax burden on
international visitors. International tourism is a major foreign
exchange earner for the United States. It is one of the bright spots in
our balance of payments picture. It generates millions of American
jobs. Why do we create a disincentive to travel to the United States.
Mr. Speaker, I will not dwell on the airline ticket tax any further,
except to say that I will work with all my energy to repeal these
provisions in the future.
This is an important day for the people of Hawaii and our Nation.
H.R. 2014 provides the people of Hawaii and our Nation with tax relief.
I urge my colleagues to support this measure.

{time} 1400

Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Florida [Mr. Boyd].
(Mr. BOYD asked and was given permission to revise and extend his
remarks.)
Mr. BOYD. Mr. Speaker, I first want to congratulate the gentleman
from Texas [Mr. Archer] for his work over the many, many years and also
my friend, the gentleman from New York [Mr. Rangel], the ranking
member.
As my colleagues know, we are going to pass today and I am going to
vote for a tax cut bill which is on balance a very good bill, and it is
a much better bill than it was when it left this House of
Representatives earlier because it had many provisions in it at that
point in time which caused many of us, including myself, to vote
against it. But the conference has chosen to take those provisions out,
and that makes me very happy.
However, there is one very obscure provision which is very onerous
which I want to tell my colleagues about, and that is a tax exemption
repeal for a Teachers Insurance Annuity Association--College Retirement
Equity Fund, better known as TIAA-CREF. TIAA-CREF was created in 1918
by Carnegie Foundation to provide a portable pension fund for
university employees. It has had tax exempt status for 79 years, and,
my colleagues, we are going to repeal that tax exempt status in this
piece of legislation that we are going to pass today, and that is
wrong.
I would ask my colleagues to work with me because the repealing of
this tax exempt status will mean that there will be a 5-percent
reduction on average of the average university employee retiree over
the next few years, and I would ask that Members will work with me to
repeal this provision in the future.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from New
Jersey [Mr. Rothman].
(Mr. ROTHMAN asked and was given permission to revise and extend his
remarks.)
Mr. ROTHMAN. Mr. Speaker, I believe that promises made should be
promises kept, and that is why I am proud to support this historic
bipartisan balanced budget agreement.
Among the most important provisions in this bill, the basic concepts
of my Lifetime Learning Affordability Act are very much prominent. For
the first time we will be giving American families up to $2,000 in tax
relief for their children's college tuition and allowing them to save
in IRA-like savings accounts for their own lifetime of learning. It
also increases the Pell grants to a historic high and restores the tax
deduction on the interest on student loans.
Seven months ago, when I took office, I promised the people of the
Ninth Congressional District of New Jersey that I would fight for a
balanced budget. I promised to help bring about a smarter, more
effective, more cost-efficient government that invested in our people,
that kept our Nation's historic commitment to seniors, our children and
the environment.
This balanced budget agreement delivers for the hard-working men and
women of Bergen and Hudson Counties, NJ, and that is why I am proud to
support this historic balanced budget agreement. Promises that were
made have now been promises kept.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from New
Jersey [Mr. Menendez], the deputy minority whip.
(Mr. MENENDEZ asked and was given permission to revise and extend his
remarks.)
Mr. MENENDEZ. Mr. Speaker, what will morning in America look like
after we pass this bill? What will be the American vision of the
future? We delivered the balanced budget based on tough choices and
sacrifices made by Democrats in 1993, but the Democratic vision for
America did not stop with a tax cut for corporations and the wealthy.
Democrats fought for and delivered a far greater vision for all
Americans and a more inclusive tax cut.
Tomorrow morning in America, because of Democrats, 24 million more
children will wake up with health care, millions more than under the
Republican plan. Tomorrow morning in America, because of Democrats,
every student with a talent and ambition will awaken to the opportunity
to attend a 4-year college and get a degree, millions more than under
the Republican plan. Tomorrow morning in America a hard-working farmer
or small business person will be able to keep the family business in
the family. Families will more easily sell and buy better homes.
Hundreds of neighborhoods will awaken knowing that the local scourge of
a nearby polluted brownfield will be cleaned up. Tomorrow morning in
America twice the families in my own home State of New Jersey will
receive a tax credit for their children because Democrats fought for a
better vision of the future.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Minnesota [Mr. Vento].
Mr. VENTO. Mr. Speaker, I rise in support of this Clinton tax
package. It is build on the hard work of the 1993 vote. Quite frankly,
voting for tax breaks is one of the more pleasant tasks or the easier
tasks that Members of Congress have to perform. Everyone likes to vote
for a tax break, many of our constituents want them and are most often
pleased with the tax breaks.
But the fact is there would be no tax break legislation today
available, without a bigger deficit but for the actions the 10 past
years. Congress is not going to do what was done in the riverboat
gamble of 1981. Congress is not going to do that. Today we are pursuing
a much different policy path. The Federal Government fiscal policy
actions have earned this tax break by making tough votes such as the
vote on the 1993 budget. Today this mostly positive tax breaks. Eighty-
four percent of this bill the next 5 years goes for a child credit and
education credit. Investing in people; that is the type of tax breaks
the American families need. There is some other provisions in here, but
that is reflection of political symmetry of the Federal Government.
This action is no Ronald Reagan riverboat gamble, rather it is a good
bill

[[Page H6648]]

and not savaging the basic programs that we came here and pledged to
support, not the policy path of 2 years ago when, in fact, programs,
like Social Security and others were the sacrifice for lavish budget
busting tax breaks, this tax policy is a policy earned by solid fiscal
discipline. We may be a little bit ahead of the curve in hoping to
reduce the deficit and being certain that the deficit is under control
but the fact is this is a sound tax break, a result of deliberate
policy it eliminates the indexing, it eliminates the automatic pilot
type of provisions that were in the initial bills. It is a measure that
will get a big vote today, but it is built, as I said, on hard work of
1990. I might say the budget of President Bush and Congress, and the
1993 budget of Clinton and Congress. Congress has not since the early
1980's been able to vote for additional substantial tax breaks or cuts,
because the policy path of excessive tax giveaways and uncontrolled
Pentagon spending dug the deficit hold so deep that the emphasis has
been on correcting and rehabilitation of the consequence of the Reagan
riverboat gamble tax policies.
Finally, today in a measured manner and on a reasonable basis
maintaining the programs that the American families need to care for
themselves and one another, we can return and focus on tax breaks which
help families and invest in people.
Certainly the price of this has been some tax breaks for special
groups that are not needed nor justified, but the Democrats led by
President Clinton turned the GOP Congress product of 2 years ago and
turned it inside out to principally help families and balance the
budget without blowing up the budget for the future. A positive bill
for which I can vote and urge others to support.
Mr. ARCHER. Mr. Speaker, I yield 3 minutes to the gentlewoman from
Washington [Ms. Dunn], a highly respected member of the Committee on
Ways and Means.
Ms. DUNN. Mr. Speaker, because of the Republican majority in
Congress, for the first time in 16 years women across America are
getting a tax cut. The truth is the Republican tax relief bill helps
women throughout their lives both at home and the job market. The only
people who think this tax relief bill is not good for women are those
who do not believe we women can manage our own money, and that, Mr.
Speaker, is passe.
So let us talk first about tax relief at home. With our bill the
mothers of 41 million American children will be able to keep more of
their own money. The $500 per child tax credit that will begin in 1998
is money mothers surely can use to make ends meet, money that can be
used to pay for school clothes or for groceries or for all the
unexpected expenses that come with raising a child.
Women and their families will also receive help in sending children
to college. The cost of higher education is overwhelming these days. I
just finished paying for two children to go to college, and truly
believe me, I know how expensive it can be.
Women are provided additional options to save for their retirement
through expanded IRA's. The fact is that we women live longer than men.
Yes, we generally have less savings set aside. I do not believe our
society wants to force a woman into buying shoes for her 8-year-old
child as opposed to saving for her retirement, and expanded IRA's will
help provide the savings that will work toward those worrisome
retirement years.
And now let us talk about the workplace. Women are starting
businesses today at twice the rate of men. A lower capital gains tax
leaves more critical capital in hands of women business people, women
investors, and women entrepreneurs. Why is this so important to women?
Because the 1995 survey of women-owned businesses tells us that 84
percent of women use personal savings to start their businesses.
Mr. Speaker, the American dream for everyone, including women, is to
make life better for our children and for our loved ones. Yet the
current death tax is such an onerous burden that when the owner of a
family farm or business dies, the children often must sell their
inheritance just to pay the taxes. That is what this bill is about,
providing women with options and time to balance the demands of today's
world. No longer should women feel they are being pulled in 10,000
different directions, often sacrificing themselves and their children's
interest just to pay Uncle Sam.
Mr. Speaker, helping American families and especially America's women
is all part of the Republican agenda. The truth is this tax relief
never would have happened if it had not been for our majority, and we
are proud of our work on behalf of American families, and we look
forward to making Government more and more efficient while keeping that
safety net out there for those Americans who truly need it.
Mr. RANGEL. Mr. Speaker, I yield such time as she may consume to the
gentlewoman from California [Ms. Sanchez].
(Ms. SANCHEZ asked and was given permission to revise and extend her
remarks.)
Ms. SANCHEZ. Mr. Speaker, I rise today in support of the balanced
budget agreement. Today we will have the opportunity to provide hard
working Americans with the first balanced budget in a generation.
We have accomplished an amazing feat today. The President and
Congress have come together for a truly bipartisan budget agreement.
A budget that is balanced, that provides fair tax relief, that
provides coverage for children's health care, and that truly expands
education opportunity.
Congressional leaders and the President have worked to draft a bill
that helps middle class parents. These Americans have funded the
deficits of the last decade and deserve a return on their investment.
This historic investment in education includes the HOPE Scholarship
Program that truly will give hope for a college education to working-
class American families.
It includes the largest Pell grant increase in two decades. As a
former Pell grant recipient, I know how much we need this funding.
This agreement provides the first tax cut for Americans in 16 years.
This budget gives a $500 per child tax credit to every family in
America. It also allows parents to save for their child's higher
education with the education IRA.
We have finally recognized what our parents and community leaders
already knew, that when we cut taxes to families, when we provide
children's health care, and when we invest in education--when we
balance the Nation's budget--our cities, our States, and our Nation
will prosper.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Illinois [Mr. Davis].
Mr. DAVIS of Illinois. Mr. Speaker, I want to first of all commend
and congratulate all of those who have worked to reach this accord. But
when I viewed the balanced budget agreement I asked two fundamental
questions:
Is it fair and does it go far enough to lift the boats of all
Americans, including the poorest among the poor?
And while I agree that there has been serious movement toward the
inclusion of more families and more children, I still must ask the
question, is it good for all of America?
This agreement provides tax relief for the richest of Americans to
the tune of over 70 percent. Is that fair? Under the current agreement
corporate welfare continues to be protected, and so I agree that it is
movement, but I do not believe that it goes far enough to really touch
the poorest of the poor.
I believe that we can do better. We provide serious breaks for the
rich, a few breaks for the middle class, practically no breaks and
little hope for the poor.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Tennessee [Mr. Clement].
Mr. CLEMENT. Mr. Speaker, several days ago I had the opportunity to
participate in a news conference at the White House, and it was a true
love-in, it was a true commitment that we are going to balance the
budget, and it is historic. We are on track toward a first balanced
budget since 1996. We are on pace toward our first tax cut that we have
really had since 1981. A couple of years ago, how many of us in this
Chamber could have predicted such far-reaching and much needed reform?
As a former college president, I am proud of the commitment that we
have made on education, a $1,500 tax credit for college, $2,500 tax
deductions for interest paid on college loans and $500 tax free
contributions into education IRA's.
And it is a pro-family reform as well, $500 per child credit,
approximately doubling the tax exemption on real estate for both
individuals and couples.

[[Page H6649]]

Let us keep the budget process moving, let us cast a ``yes'' vote,
and let us balance the budget once and for all for all Americans.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentlewoman from
California [Ms. Waters], the chairperson of the Congressional Black
Caucus.
Ms. WATERS. Mr. Speaker, I would like to thank the gentleman from New
York [Mr. Rangel] and the gentleman from Texas [Mr. Archer], the chair
of the Committee on Appropriations, for their work, and I know how hard
he struggled. However, this Congress is about to pass the most profound
and drastic tax cut this Nation will experience in many years to come.
This is a true redistribution of the wealth, and let me tell my
colleagues why.
The top 1 percent in our Nation will get a tax cut of about $16,000.
That is people who make over $645,000. The next 4 percent, people who
make about $150,000 will get a tax cut of $1,492. But let us take a
look at the lowest 20 percent, the lowest 20 percent in our Nation,
people who make $6,500 will have to pay $39 more. The next 20 percent,
people who make $15,000, will only get about $114, and the next 20
percent, people who make $27,000, will get about $194 in tax cuts.
Well, let me just show my colleagues this. In capital gains, this
means the CEO's of major corporations like Donald Trump and over at
Nike, they will be able to take their pay in stock options and the
stock options will only be taxed at 18 percent which means they will be
paying about half of what the average working person will be paying in
taxes.
So who is getting the short end of this deal? Not only are the poor
in inner cities, where the economy is not performing, still no jobs,
low paying jobs, jobs that have been exported to Third World countries
for labor, let me tell my colleagues about districts like the district
of the gentlewoman from Idaho [Mrs. Chenoweth], in her State's
panhandle with the median income of less than $25,000 per year and a
per capita income of $11,530.

{time} 1415

These are working and poor people in districts like that of the
gentleman from Florida [Mr. Charles Canady], Poke County, FL, with a
median household income of $25,315 per capita and personal income of
about $12,277.
I want to tell the Members, this is not the right way to go. It is
going to pass. Republicans are going to take credit, Democrats are
going to take credit. Nobody knows what is in the details. But I want
to tell the Members, the American people will find out. They will know
in the final analysis. This is no deal for the average Americans. Rich
people will make out again. They will be partying on Wall Street
tonight.
Mr. ARCHER. I yield myself such time as I may consume, Mr. Speaker.
Mr. Speaker, I would just briefly respond to the gentlewoman from
California [Ms. Waters] and say that every Member has had an
opportunity to know every detail on this bill because every detail has
been on the Internet beginning at 7 o'clock last night.
I know Members diligently have wanted to peruse this bill and to
learn the details. I am sure that last night they have stayed with
their staff and have had the opportunity to learn all of the details
that are in this bill.
Mr. Speaker, I yield 2 minutes to the gentleman from Texas [Mr.
DeLay], my neighbor and my friend.
Mr. DeLAY. Mr. Speaker, I want to commend the chairman of the
Committee on Ways and Means for all the hard work he has done to bring
this to the floor. I have to tell the Members, I rise in support of the
Archer tax cut. I urge my colleagues on both sides of the aisle to
support it.
Mr. Speaker, sometimes history is made by bold strokes and sometimes
history is made with small steps. Today we are taking a small step
toward a smaller and a smarter Government. This tax cut legislation
represents only the beginning of our agenda that will give the American
taxpayer real relief from an oppresive Tax Code. A Government that
takes over 50 percent of the average family's income threatens liberty
and needs serious reform.
But in our system of government, reform is best achieved through
bite-sized bits that are easily digested, I believe, by the voters and
easily understood by popular opinion. This is the first bite of a
seven-course tax-cut meal. Some of my colleagues will say that this tax
cut is not enough to tide them over. I agree. But I promise the Members
that this first tax cut in 16 years will not be the last tax cut in 16
years.
This bill is a good start. It contains necessary relief for families
with children. It will spur economic growth by lowering taxes on
investments, savings, and job creation. It starts the process of
phasing out that punitive death tax.
To those liberals who complain that this tax cut goes too far, let me
just simply say that in my view we can never go too far in allowing the
American family to hold on to more of its hard-earned money. I urge my
colleagues to start the process to cut taxes for all Americans and vote
for this sensible bill.
Mr. ARCHER. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
New Jersey [Mr. Pappas].
Mr. PAPPAS. Mr. Speaker, today is a great step forward, a new
beginning down the path of ending the era of big government. For the
first time in 16 years, the American people are getting real, permanent
tax relief, the Archer tax cut of 1997. Every American is a winner
today. We have sent a message that Washington has to make do with less,
so people can keep more of what they earn. I think too often in
Washington bureaucrats forget it is not their money to waste. People of
America work hard for the money and it is theirs.
This is real tax relief. People in every stage of life will receive
something, families with children to pay for schooling, for home
ownership, for home-based businesses, or to save and invest for
retirement. From the family farm to the small business, everyone
benefits. Families deserve the freedom our tax relief plan will bring.
The $500-per-child tax credit will give parents more freedom in
raising their children to be healthy, well-educated, productive adults.
I want to commend the Republican leadership and Chairman Archer for an
excellent job and a tremendous first step.
Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the respected member of
the Committee on Ways and Means, the gentleman from Minnesota [Mr.
Ramstad].
Mr. RAMSTAD. Mr. Speaker, I thank my distinguished chairman for
yielding time to me, and for his outstanding leadership. I daresay,
without the gentleman from Texas [Mr. Bill Archer], we would not be
here with this tax relief bill, the most substantial tax relief for the
American people since 1981.
Mr. Speaker, in addition to the more publicized provisions of this
bill, the child tax credit, the higher education relief, the capital
gains cuts, and the death tax relief, I would like to point out several
provisions that I have worked on for many months with several of my
colleagues to help victims of the recent flooding in the Red River
Valley of Minnesota and the Dakotas. I want to thank Chairman Archer
for his help as well in getting these provisions in this bill.
We include special mortgage revenue bond rules for those people to
rebuild their homes in the flood areas. We extend the IRS deadlines in
the flood areas. We provide interest abatement for delayed filings, and
special IRS rules for the forced sales of livestock that were caused by
the horrible, horrible floods.
I am also gratified that several other reforms I have worked on are
included. We changed the rules governing employee stock ownership plans
[ESOP's] to make it easier for small businesses to give ownership to
employees of the company. We prevent the taxation of survivors
benefits. We stop, no more taxation for survivors benefits for police
officers or firefighters killed in the line of duty.
We make the administration of church pension and benefit plans much
more workable. We include language to clarify the tax-exempt status of
State health insurance risk pools that provide coverage for high-risk
people and their children and spouses.
Mr. Speaker, this bill will provide important relief to real people
right now. I urge my colleagues to support this important legislation.
Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from
California [Mr. Calvert].

[[Page H6650]]

Mr. CALVERT. Mr. Speaker, I stand in favor of this bill. I also want
to commend the chairman of the Committee on Ways and Means for an
excellent job.
It certainly is an historic week. For the first time in a generation,
we will balance the budget and provide tax relief to working families
across the Nation. This Congress will leave the legacy of a smaller,
less invasive government to our children. At the same time, we will
ensure that middle-class Americans keep more of their money.
Today we will refund to the American people one-third of President
Clinton's tax increase, the largest in history. Back in my
congressional district, the per-child tax credit will mean families
with children can save $47 million next year. California has had some
tough years, as the Speaker knows. We are looking forward to having
better years. This is going to help, Mr. Speaker.
Some said this day would never happen. Thanks to the Republican
Congress, it has. But the real winners this week are my constituents
and the rest of the American people. We look forward to future days
like this.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
California [Mr. Becerra], a member of the Committee on Ways and Means.
Mr. BECERRA. Mr. Speaker, I thank the gentleman from New York,
especially for all the work he has done on this particular balanced
budget agreement.
Mr. Speaker, if 535 Members of both the House and Senate got together
to try to draft a bill, we would have 535 different versions of a
balanced budget agreement. That is why in a democracy and in politics
compromise is what must rule. If we do have that type of compromise, we
have leadership and we will have progress.
We have to accept some bad with the good. Democrats, I know for
example, fought for about 5 million children to be included within the
child tax credit because they happen to fall within families that earn
between $18,000 and $30,000. Republicans were able to achieve victory
for families earning $75,000 to about $160,000, and including them
within the child tax credit as well.
Democrats fought hard to get another $8 billion more for child health
care, to try to help cover some 5 million of the 10 million uninsured
children in this Nation. Republicans fought very hard and succeeded in
getting the corporate tax rate dropped on capital gains tax rates.
Democrats fought very hard to make sure that empowerment zones and
brownfields were included in the legislation, which would allow for
economically depressed areas, those areas that had contamination in the
soil, to be reached by new entrepreneurs who are willing to take a
little bit of a risk, and they will get some incentives and tax breaks
if they establish a business in these areas.
Republicans, on the other hand, fought very hard to get IRA's,
individual retirement accounts, that will now go to those who can put
up to about $2,000. If they happen to have incomes up to about
$160,000, now they will not have to pay taxes on those particular IRAs.
They benefit.
Democrats made sure that the education package would give someone who
is going to community college and pays $2,000 a year at least $1,200 of
tax breaks. The Republicans wanted to give $750. We won on that. The
Republicans were able to get more breaks for the 1\1/2\ percent of
people who die and have to pay an estate tax.
We all win and we all lose. Ultimately we try to compromise. I think
we can all say that whether one lives on Main Street or Wall Street, we
all won.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Texas [Ms. Jackson-Lee].
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Speaker, allow me to say to the
gentleman from Texas [Mr. Archer], a friend and someone who I know has
worked so very hard on this bill, I thank him very much. I rise today
to support this legislation and this effort.
However, I would say to the gentleman from Texas, Bill, if I might
call you that, if we acknowledge the sincere distinctions that we have
in this House, let me now commend my good friend and the ranking member
of the Ways and Means Committee, the gentleman from New York, Mr.
Charlie Rangel. Charlie Rangel is a Korean war veteran who went to
school on the GI bill.
It so happens that his history may track a little more where I came
from, where the earned income tax credit might have helped my parents
who did not have a college education; who struggled every day, and may
not have known sometimes how the bills would be paid.
I represent a district that looks like that of the gentleman from New
York, Mr. Charlie Rangel, and with poor people and working people, and
great ethnic diversity, so I also stand in the well of this House
acknowledging that there are some stumbling blocks in this tax bill.
Nevertheless, I cannot thank Charlie enough for staying in there in the
fight, never forgetting where he came from.
So we now have in place for those people making $30,000 a year tax
relief. The HOPE scholarship has been made better. In fact, now you do
not have to worry about whether you are going to Yale or Harvard to get
tax relief, you can go to your local community college and you can get
$1,500 a year free and clear and you can go and get an education.
I do not like that most Americans do not save a lot. This may change
because of this tax bill. It gives incentives for savings. That is a
positive. England is No. 3 in this world on assets because their people
save. Yes, I do not like total airline taxation system, but we have
made it better, and we are going to stay on it and make it much better.
To my airline constituents those on short domestic routes and those on
international routes, I will continue to monitor the impact on this
bill.
To the Members, there is something else we can work on. We can work
on tax simplification, so all of us can understand how to file our
taxes, because we are a nation that believes in carrying its weight.
Further, in the outyears, if this deficit explodes, I am committing to
be diligent in making sure this Congress fixes this bill so we do not
have the deficit that we had before, which hurts the economic health of
this Nation.
There are some stumbling blocks here, but to that I quote
Shakespeare's words ``that unto each of us is given a book of rules and
a bag of tools, and each must make, ere life is flown, a stepping stone
or stumbling block. Stumbling blocks are in this bill, but there are
enough stepping stones that we should vote for this bill. This is a
bill for America. I am proud to vote for this tax bill, because people
like me and people I represent will be able to count a few more dollars
in their pockets and get real tax relief. At the same time America's
business is freer to reinvest in America's economy and create jobs!
jobs! jobs!
Mr. Speaker, I rise today to join my Democratic colleagues in raising
the flag for the Americans who truly need the tax cuts in this bill.
Let's not kid ourselves here, this will mean an increase in the
paychecks for working people that Democrats represent. This bill may
mean a decrease of Republicans on lines 13 and 14 of their Schedule D's
after they confer with their lawyers and accountants, But, today
Democrats can raise the flag for working Americans who bring home a
paycheck that will see an increase as a result of work on this side of
the aisle.
Let's make no mistake about it, Mr. Speaker, the economic engine that
is driving our expanding economy is being oiled and maintained by
Americans who carry lunch boxes to work and really do something or make
something for the paychecks they receive. They don't clip coupons, they
work for a living. They don't have lobbyists up here on Capitol Hill
making campaign pledges to us. They are the ones who really deserve the
break today that this bill is delivering.
Democrats fought Republicans and won the $500 child tax credit for
families who need it, families making under $30,000 a year and may have
depended on the earned income tax credit in the past, the American wage
earners that the Republican leader characterized as getting welfare if
they got the child tax credit.
Mr. Speaker, Democrats fought for and won this credit for 15 million
taxpaying, working families that the Members on the other side of the
aisle argued vehemently were less deserving than families making over
$100,000 a year. Republicans failed the fairness test even though they
originally promised in their Contract With Americans back in 1994 that
those

[[Page H6651]]

15 million would be included in their targeted tax breaks. Thanks to
our work, the work of Democrats, those working class Americans are
included today.
Mr. Speaker, the American public knows who stood up for the families
who send their children to our community colleges, to our great land
grant universities, our venerable State colleges and universities and
our Historically Black Colleges and Universities. Americans know that
they will be able to contribute tax-free to State run prepaid tuition
plans because of the work of Democrats. They know that the HOPE
Scholarships that give students a tax credit for the first 2 years of
college worth 100 percent of the first $1,000 of their tuition and 50
percent of their second $1,000 of tuition has a Democratic stamp on it.
They know that in the third and fourth years of their college education
they will get a tax credit worth 20 percent of $5,000 of tuition
expenses for each year because of the Democrats on Capitol Hill.
Mr. Speaker, there can be no doubt about which Members of Congress
expanded the welfare-to-work tax credit in order to help those
Americans and their employers who are making the transition from
welfare to work. This bill gives employers who hire those who may have
been less fortunate than others and have been on welfare for an
extended period of time a tax credit equal to 35 percent of the first
$10,000 in wages in the first year of employment and 50 percent of the
first $10,000 in the second year. I offered this very same amendment in
the 104th Congress, I am glad today it passed. The targeted urban
communities that this part of the bill will help includes the city of
Houston and the people there and in other urban areas who are making
the effort to turn their lives around. These are the people for whom
government can truly make a difference. These are the people who may
not have anybody in their lives to give them boosts and incentives to
help them make a better life for themselves.
Mr. Speaker, I am also mindful of the consumers who fly on our
airlines like Southwest and Continental. America's airlines, both big
and small, as well as their passengers are winners under this bill,
although we can do better. The financial reform that begins with this
bill will insure airline safety in the future, and airline industry
prosperity.
Mr. Speaker, I am proud to be a Democrat and vote for this bill. It
is good for our country and Democrats have helped those who really need
our help.
Mr. ARCHER. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
South Carolina [Mr. Graham].
Mr. GRAHAM. Mr. Speaker, I do not think I can pick up with the
passion we just saw, but that is good news. This is an amazing day.
Mr. Speaker, the firmness and fairness of the gentleman from Texas
[Mr. Archer] brought this deal about. I hope the American people
understand that. Our Republican leadership team has done a good job,
but the best decision they ever made was to let the gentleman negotiate
for us. It has really helped a lot.
The gentleman from New York [Mr. Rangel] is going to vote for this
bill, I understand. I know this is difficult. I congratulate him for
making what has to be a difficult compromise, but I think the Nation is
better off.
I am not going to talk about the details for the next few seconds.
The important thing to me is that we are taxed from the time we get up
in the morning and drink our first cup of coffee to the time we go to
bed and watch a show on television and pay cable taxes. We are taxed
from the time we are born until the time we die. Today we get just a
little bit of our money back, and a little money and power flows out of
Washington today. We do not need to worry about the details.

{time} 1430

The most important thing that you need to understand about today is
that, when President Clinton moved to the middle and agreed that money
and power need to come home in a fair way and said giving money and
power back to families, businesses, and local government is a good
thing, the public has rewarded him, and they should, and the Democratic
Party. But let it be said, as a member of the Contract with America
class, that our legacy to this country is that new people came to
Congress and sang a different song, and that tune has been picked up by
people who have never sung it before and it is music to the American
public's ears.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from Texas
[Mr. Bentsen].
(Mr. BENTSEN asked and was given permission to revise and extend his
remarks.)
Mr. BENTSEN. Mr. Speaker, I thank my colleague from New York for
yielding me this time. I am going to vote for this tax bill for a
couple of reasons. First of all, I want to thank the gentleman from New
York [Mr. Rangel] and the President for making the child tax credit
refundable. Somebody making down to $18,000 a year is not on welfare.
They should share in this tax cut.
Second of all, the education investment is probably the most
important investment vehicle that we have in this tax bill to move the
economy forward. With respect to the capital gains proposal, the final
proposal actually, I think, is far better than we started because it
addresses holding periods. I think that is much more efficient
economically. It allows us to not reward churning of accounts but to
reward long-term investments that are more productive. With respect to
some issues in it, I am pleased that you dropped the difficult minimum
provisions that have been requested by the administration. That is very
important to State and local governments.
I regret that we still have the $3 head tax in it that will affect
short haul carriers such as Southwest Airlines in my State. I think
that belies the fact that these carriers pay the same capital cost as
long haul carriers through State and local landing right agreements.
Overall it is a good bill. Let us just hope that it works.
Mr. Speaker, I rise in support of this legislation, which is much
more fair and fiscally responsible than the legislation approved by the
House on June 26. This conference agreement improves upon the original
legislation in several significant ways: it provides more tax relief to
low and moderate-income taxpayers most in need of this assistance; it
provides more extensive tuition tax credits to help families afford a
college education; it better targets capital gains tax relief to reward
economically productive long-term investments; and it eliminates or
limits provisions that would have caused the cost of this legislation
to explode over time, resulting in new deficits.
The child tax credit in this conference report is much more fair than
in the original House bill. This legislation extends the child tax
credit to working parents making as little as $18,000 annually who
would have been denied this assistance under the earlier bill. My
Republican colleagues claimed giving a child tax credit to families
earning less than $30,000 per year was the same as welfare. Mr.
Speaker, this is not welfare. These are working, taxpaying, wage-
earning families who would have been denied tax relief simply because
they do not earn enough to pay income taxes, although they still have
to pay substantial and regressive payroll taxes. These are people
working harder than ever to stay off welfare. Because of strong
Democratic support led by President Clinton and Ways and Means Ranking
Member Charles Rangel, we now have a bill that helps these families
too. As a result, 5.5 million more children from these working families
will benefit from this tax credit. This is the right thing to do to
strengthen our families and reward their hard work.
This legislation also improves substantially on the tuition tax
credit. The original House bill would have cut the value of the
proposed $1,500 tax credit in half and provide only 50 percent of
tuition expenses for millions of students attending community colleges.
This agreement provides the full tax credit for the first $1,000 of
tuition costs and a 50-percent credit for the second $1,000 of tuition
for each of the first 2 years of college. And it provides a tax credit
worth 20 percent of $5,000 of tuition expenses for the third and fourth
years. In addition, it allows an income tax deduction of up to $2,500 a
year for interest paid on student loans, which I have long supported,
and creates a new individual retirement account specifically for
education expenses. These are the right investments to make because
higher levels of education are necessary than ever to succeed in
today's global, high technology economy. Just last week, we heard
testimony from Federal Reserve Chairman Alan Greenspan and numerous
respected economists that, in order to ensure American workers' earning
power, we must increase their level of education. This bill provides
for that need.

I am also pleased that this legislation rewards long-term investment
by reducing the maximum capital gains rate to 20 percent for
investments held for at least 18 months and 18 percent for those assets
purchased after 2000 and held for more than 5 years. The capital gains
rate would be reduced to 8 percent for such long-term investments for
taxpayers in the 15-percent tax bracket. This provision moves in the
direction of legislation I have introduced to reduce the capital gains
tax on a sliding scale based on how long an asset is held, which I
believe is both economically productive and fiscally responsible. In
this way, we will reward patient capital that is

[[Page H6652]]

so vital to starting and expanding businesses and creating jobs.
I regret that the bill continues to impose a per segment head tax of
$3.00 under the airline ticket tax. This is unfair to short haul, low
cost air carriers such as Southwest Airlines based in Texas. It belies
the fact that both short and long haul carriers pay an equal amount of
the majority of capital costs of the Nation's airports through landing
and gate agreements at the local level.
Finally, I believe this legislation is more fiscally responsible than
the earlier bill approved by the House. That bill included provisions,
such as capital gains indexing, that would have caused the size of the
net tax cuts to grow rapidly after the first 5 years. The result would
have been new and larger deficits and increased pressures to cut vital
programs such as Medicare, Medicaid, education, and environmental
protection. I remain concerned that this conference report still poses
that risk. As I stated yesterday during the debate on the spending cut
bill, there are no guarantees that this plan will work. We must
carefully track the revenue stream and ensure that the next tax cuts
remain within the projected cost. And we must be willing to make
corrections if they do not.
But on balance I believe this is a good bill that will provide tax
relief to our families, help more young Americans get the college
education they need, and reward long-term investment that creates
businesses and jobs. I urge support for this legislation.
Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas, Mr. Sam Johnson, a highly respected, great patriot member of the
Committee on Ways and Means.
Mr. SAM JOHNSON of Texas. Mr. Speaker, Republicans have done what
some called impossible. We have balanced the budget, provided the most
significant tax relief in 16 years. Not since Ronald Reagan gave us 7
years of unprecedented economic growth have we given so much relief to
the millions of families, small business owners, farmers, and other
hard-working Americans who deserve to keep more of the money they earn.
This bill is going to free up dollars, free up money, taxpayer
dollars, I might add, which previously had been used for wasteful
government spending. It returns this money to the rightful owners, to
the people of the United States of America, to those who create jobs,
economic growth, and wealth. It is going to provide more people with
the opportunity to achieve the American dream of owning their own home,
seeing their children go to college, and having enough money to retire
and just enjoy their grandchildren.
Mr. Speaker, I wanted to thank the chairman of the Committee on Ways
and Means, the gentleman from Texas [Mr. Archer], my good friend, a
super Texan and a great American for his hard work and determination in
making sure that Americans get what they so richly deserve, a big tax
cut. It is long overdue. It is finally time that this Congress has done
something good for America. God really has blessed America.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Wisconsin [Mr. Kleczka], a member of the committee.
Mr. KLECZKA. Mr. Speaker, let me start out by indicating not only my
strong support for the legislation, but also my pleasure in working
with the gentleman from Texas [Mr. Archer]. Not only is the gentleman
from Texas [Mr. Archer] very knowledgeable about the Tax Code, but in
his dealings not only with myself but other Members, he always was
very, very fair. He uses a saying in the committee, it is called rifle
shot. He does not want any rifle shots as it relates to tax policy.
I cannot agree with the chairman more. I think if we are going to put
in the tax bill relief or fairness or help to a group, it should be a
broad group, not one specific corporation, not one group of individuals
but it should be a broad array of individuals. This bill, I believe,
reflects that.
I also want to thank the ranking member, the gentleman from New York
[Mr. Rangel], who kept us all honest, especially the Republican
majority not only in items as it dealt with the education portion but
also with the EITC and other areas that are so important to his
constituents, my constituents, and all our constituents.
The first time the bill came before this body, I could not vote for
it. There was a very onerous position included in it, the independent
contractors section, which would have the effect of reclassifying
hundreds of thousands of current employees who get benefits such as
unemployment compensation and workmen's compensation. They would be
denied these by reclassifying them. This bill does not have that
provision. It was taken out in the conference committee. That is
probably the major reason why I stand here today in strong support of
the bill.
Also, I think one of the criticisms we have all had from time to time
on the existing Tax Code is that it does not promote savings. With the
inclusion of three new types of IRA's, we are changing the course of
this Nation wherein we are going to reward savings and not reward
spending. I think that is an important feature.
Another area which I think should be highlighted, which is of vast
importance to millions of homeowners in the country, is the exclusion
of sale of your primary residence. Right now you have to save a whole
ton of receipts to prove you are not making any money on the sale. This
bill eliminates that.
Last, since my tax legislative assistant is leaving today to go on to
school, let me thank Win Boerckel for years of service in helping me
with my Ways and Means Committee duties.
Mr. Speaker, I rise in support of the tax bill before us today. The
Taxpayer Relief Act brings us to a balanced budget while also providing
tax relief to many Americans.
On balance, I would have liked to have seen across-the-board tax
relief for everyone, not just those with children, or those selling a
house or securities. However, this was not to be since my committee
amendment to increase the personal exemption for all taxpayers was
defeated.
Mr. Speaker, this legislation may not be perfect, but it is much
improved over the version that came before us in the House 1 month ago.
The changes made in conference have earned my support for this measure.
The House bill contained a provision that could have had a
devastating impact on workers and their benefits. The measure,
innocently labeled as a safe harbor for independent contractors, would
have permitted many employers to reclassify their workers as
independent contractors and thus deny those workers employee benefits
and worker protections. This was not only bad policy, it did not belong
in this tax bill in the first place. Fortunately, the conferees wisely
removed this language from the conference report before us today.
Likewise, this conference report provides reasonable capital gains
relief without triggering massive outyear revenue losses. The original
House bill contained not only the capital gains cuts, but also a
measure which would have allowed indexing the value of assets for
inflation. The final bill leaves out the indexing which could have led
to large revenue losses 10, 15, or 20 years from now, but includes the
rate cuts that will provide significant relief to taxpayers today.
The bill contains relief for parents raising children, small
businesses being passed on to family members, workers saving for their
retirement, and people saving to buy their first home.
In order to help parents make ends meet, taxpayers with children 16
and under will receive a $400 tax credit next year, and a full $500 tax
credit in 1999 and thereafter. This credit will be available to single
parents making up to $75,000 and couples making up to $110,000.
The bill also provides much-needed help to families with students
going on to college. The HOPE scholarship will give students up to
$1,500 a year for the first 2 years of college, and up to $1,000 a year
for their third and fourth years.
The agreement allows individuals to contribute tax-free to State-run
prepaid tuition plans, like the one we have in our State of Wisconsin.
The legislation also creates education individual retirement accounts
to which families can contribute up to $500 per year toward college
expenses. Single parents making up to $95,000 and couples making
$150,000 can open and contribute to such education accounts. In
addition, taxpayers will be allowed to withdraw up to 10 percent from a
regular retirement IRA to pay for the education expenses of a child,
grandchild, or spouse.
Starting next year, taxpayers will be able to deduct a portion of the
interest on their student loans. The allowed deduction will be $1,000
in 1998, gradually increased to $2,500 in 2001 and thereafter.
The bill provides significant estate tax relief, increasing the
amount of an estate exempt from tax from $600,000 to $1 million over
the next 10 years. In addition, small business gets more immediate
relief beginning next year when family-owned businesses and farms will
be eligible for a $1.3 million exemption.
Under this legislation, more and more Americans will be able to take
advantage of individual retirement accounts [IRA's] to save for

[[Page H6653]]

their old age, purchase a home, or save for their children's education.
Single taxpayers making up to $95,000 and couples making up to
$150,000 will now be able to contribute up to $2,000 a year to new
back-loaded IRA's. The contributions will not be deductible from
income, but the withdrawals will be completely tax-free. Withdrawals
can be made penalty-free not just for retirement, but also for the
purchase of a first home.
More taxpayers will be able to contribute to regular IRA's as well.
Over the next several years, the income limits restricting use of
regular IRA's will be gradually increased. Those single individuals
with incomes up to $50,000 and those couples making up to $80,000 will
eventually be able to make tax-deductible contributions to regular
IRA's.
Mr. Speaker, I am pleased that objectionable provisions have been
removed so that I can support this legislation bringing tax relief to
many people across this country and in the Fourth Congressional
District of Wisconsin. I urge my colleagues to support the bill.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from
Connecticut [Ms. DeLauro].
Ms. DeLAURO. Mr. Speaker, I rise today to support this tax cut
proposal and to remind my Democratic colleagues that we can accomplish
what we can accomplish when we stand up and fight for what we believe
in.
I want to say thank you to President Clinton and the gentleman from
New York [Mr. Rangel] for standing firm for Democratic priorities. Just
last week our Republican colleagues were on the floor of this House
calling a tax cut for hard working police officers and kindergarten
teachers welfare. They stood up and defended a tax bill that included
only a fraction of the needed funds for children's health care coverage
and they promoted a proposal which would have raised taxes on graduate
students and provided nothing at all in the way of relief for college
juniors and seniors.
Democrats stood up. We fought for middle class Americans, and we won.
Democrats fought for tax relief for all Americans who work for a living
and pay taxes, even if they do not make a lot of money. Democrats
fought for the full $24 billion to provide health insurance for
uninsured children and Democrats fought to improve the education tax
package to give every family in this Nation the chance to send their
kids to college. What they did not fight for were tax breaks for the
wealthiest Americans.
Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from
Illinois [Mr. Manzullo].
Mr. MANZULLO. Mr. Speaker, I received a letter from Gary Hall, dated
July 4, 1997.
Dear Congressman, I am sitting here at my dad's grave, missing him so
much. He was not only my father, financial adviser, supervisor, the
best farm adviser I know. He was my best friend. Now the family
attorney says time is getting short. You have to decide what is being
sold to pay all these taxes.
The family farm, 1,900 acres, appraised at $5.5 million, estate
taxes, $4.26 million. He says, why does the Government deserve to
squander or blow dad's hard work away? The Federal Government taking 80
percent, 80 percent of the family farm. It is unconscionable.
But the good news is, we have passed a bill. It will save him a
little bit of money. But we have a long way to go so America's farmers
can pass land on to their children without the Government squandering
it away.
Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from New
York [Mr. Paxon].
(Mr. PAXON asked and was given permission to revise and extend his
remarks.)
Mr. PAXON. Mr. Speaker, before I begin let me tip my hat to the
gentleman from Texas [Mr. Archer]. I know this is an amazingly
important day for him and his great team. They have worked so hard for
so long and labored in the minority. And today we have this happen, and
we just tip our hats and say, thank you for your perseverance and your
dedication.
Mr. Speaker, what a difference a Republican Congress makes. Four
years ago this very month the other body, the other party was enacting
another celebrated budget. That budget increased taxes on Social
Security, on gasoline, on income, even Democrats called it the largest
tax increase in the history of the world.
It gave us deficits as far as the eye could see and did nothing to
save Medicare. Today we are prepared to pass another kind of budget.
There is a difference. Today we are cutting taxes for children, for
college, for farms and for homeowners.
We eliminate the deficit and save the Medicare system which saved the
lives of both of my parents. But you ain't seen nothing yet.
This Congress intends, under the leadership of the gentleman from
Texas [Mr. Archer], to come back again next year and to work harder to
cut even more taxes for the American people. For example, next year I
believe we could cut payroll taxes, eliminate the marriage penalty, and
give a break to families who care for their elderly parents or we could
do as my hero, Ronald Reagan, wanted to do, which is have even larger
across-the-board income tax cuts for all American taxpayers.
Of course, our ultimate goal is nothing short of eliminating the
entire Tax Code and replacing it with either a flat tax or a national
sales tax, a debate this country needs and is long overdue.
Mr. Speaker, this is not the final battle in the war to cut America's
taxes. This is but the opening shot. What a difference, truly, a
Republican Congress and leaders like the gentleman from Texas [Mr.
Archer] have made and are making for us every day.
Mr. RANGEL. Mr. Speaker, I yield 5 minutes to the gentleman from
Michigan [Mr. Bonior], a leader of our Democratic Party and our whip.
Mr. BONIOR. Mr. Speaker, I am voting for this tax bill because it
helps working families. In the Republican bill you almost had to be
wealthy or work on Wall Street or own a big corporation to get a tax
cut. We said no to that. Democrats said that tax relief should go to
the teachers, the police officers, the nurses, the family farmers, the
construction workers. These are the people who make America work. They
put in a hard day's work, day in and day out, and they needed the
relief.
I will never forget the debate we had on this floor over the last 45
to 60 days. We talked about that police officer in Atlanta, GA making
$23,000 a year, putting his life on the line every day, has two
children. And we said in our proposal we wanted him and his wife to
share with their children and that child tax credit.

{time} 1445

And they said it would be like giving welfare to that police officer.
Well, they were wrong. We fought them on it and we won.
Under today's tax bill, 27 million working families will get a child
tax credit. Homeowners will be able to keep more of their gains when
they sell their home. Students from working families and people who
have lost their jobs or want to upgrade their skills will be able to
get a $1,500 tax credit from their community college, job retraining,
or a 4-year degree. That will all be supplemented in this bill.
Now, these are the people that the Democrats fought for, and we won.
But I must tell my colleagues this afternoon and concede that we have
paid a price for all of this. This bill is indeed a compromise. In
exchange for extending the child credit for working families,
Republicans demanded huge tax breaks for the wealthiest 5 percent, and
they got them. In exchange for education tax credits, Republicans
demanded huge tax breaks for America's largest and biggest
corporations, and they got them.
I am talking about tax breaks like rolling back the corporate minimum
tax. So we are now going to go back to the days when some of the
biggest corporations in America will not pay any taxes at all. It is an
outrage; a $19 billion outrage.
So we will be watching and we will be fighting. The gentleman from
New York [Mr. Paxon] comes to the floor and says there will be another
tax bill next year. We will fight with every ounce that we have against
this $19 billion giveaway to the biggest corporations. We will be
fighting to make sure that the tax breaks now going to the wealthy do
not come out of the pockets of working families in the future.
We will be fighting for fairness, because working families will not
stand for it if our Tax Code turns into a picnic basket of corporate
giveaways. They will not stand for it if the Fortune 500 companies
reaping huge profits pay no taxes at all. They will not

[[Page H6654]]

stand for it if the CEO's, making 200 times the salary of the average
worker, squander their capital gains on corporate jets and luxury
limousines instead of investing in jobs in our communities. And they
will not stand for it if stock market speculators run off with all the
benefits while the people who work with their hands pay all the bills.
Today I am voting for that person. I am voting for that mother who
will be able to take that $500 credit and buy her daughter books and
school supplies. I will be voting for that police officer and his wife
who will be able to get $1,000 for their children. I think of that
fellow who wants to become a welder who can take a $1500 education
credit and sign up for a course and land a good job and a good wage. I
will be voting for him.
So, no, this bill is not perfect, but my friend, the gentleman from
New York [Mr. Rangel], and all those who worked on this bill to bring
it to some sense of equity, we have a long ways to go, but we brought
it from where they started at $245 billion with the Contract With
America, we brought it home to where at least some of the benefits will
go to working people in this country who need them so badly.
No, this bill is not perfect, Mr. Speaker, but these people that we
fought for cannot wait and I am voting ``yes'' for their future.
Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
I oppose this bill and suggest to my colleagues and the American
people that it is unfair and unnecessary. The Congress is lying to the
American people because this does not balance the budget. It cannot
balance the budget until 2002 unless we make more cuts, and we are not
going to make those cuts. We have not now and we will not then.
If we did nothing, the budget would balance this year or next year by
itself. Government, again led by the Republicans in Congress, is
mucking up the economy by bringing forward an unnecessary bill.
These unfair tax cuts, 75 percent of these tax cuts go to families
with over $150,000 in income. Simmons, the beet king in Texas, gets
$104 million individually. Sammon Enterprises in Texas gets $23
million, negotiated in the dead of night in the Republican leadership
offices, where they probably got those two $500,000 campaign checks
from the Amway Co., and they gave Amway $200 million in tax deductions
for their Republican contributions.
And in the secret of night it harms poor families who will have a $40
tax increase. And what my colleagues do not know is that it eliminates
abortion for poor young women. That is buried in this bill. It hurts
cancer victims. Unknown to any of us here, the tobacco settlement,
which is not even agreed to yet, $50 billion of the money that should
come out of the tobacco settlement is being credited because of the
tobacco tax. That money was supposed to go to cancer victims. The
Republicans are stealing the money that is supposed to go to cancer
victims from an unfinished tobacco settlement and using it to fund this
turkey.
My fellow colleagues, this is an unnecessary bill with a political
purpose and it is economic nonsense. It harms the American public and
only helps 1 or 2 percent of the very richest Americans who make their
money either through inheritance, not a heavy-lifting job, or through
stock market activities.
There are secrets buried in this bill which are undetermined at this
point and were decided last night in the dead of night. I urge my
colleagues, in the sense of parity and economic justice to vote ``no''
on this tax bill.
Mr. ARCHER. Mr. Speaker, I yield myself such time as I may consume to
very briefly refute the statements that my friend on the Committee on
Ways and Means, the gentleman from California [Mr. Stark], just put
before the Congress.
I do not know where his figures come from, but the Joint Committee on
Taxation, which distributes and scores this bill, has distributed the
benefit of this bill so that 76 percent goes to people under $75,000 of
income. Now, with the addition of the change in the child credit and
other things that were done, it is even more that goes to people who
are under $75,000, and primarily between $20,000 and $75,000 of income.
What has added more regressivity to this bill is the fact that those
who favored the cigarette tax have put in place a tax that is the most
regressive tax in the bill. Irrespective of how one feels about
cigarette taxes, when the scoring is done on regressivity, that pushes
more of the burden onto the very, very low-income people.
So I wish we would just get the facts before the Congress and before
the people.
Mr. MATSUI. Mr. Speaker, I rise today in opposition to this tax
package which moves us away from the paramount goal of this Congress--
bringing the budget into balance. This bill also moves us away from two
other very important goals--tax simplification and tax fairness.

deficit reduction

The historic budget agreement between the President and the Congress
called for net tax cuts of $85 billion over 5 years and $250 billion
over 10 years. If we did not pass these tax cuts economists predict
that we could reach a balanced budget in 2 to 3 years. This agreement
will push that goal out to the year 2002.
In addition, the bill before us includes an even bigger net tax cut
of $95 billion over 5 years and $275 over 10 years. Over 5 years the
tax cut exceeds the agreement by $10 billion and over 10 years it is
$25 billion over the line. There is no reason to enact such a large tax
cut package in excess of the budget agreement. In the 10 years beyond
2006, the size of the tax cuts will continue to increase. The
cumulative cost by the year 2017 could go as high as $500 to $600
billion. It is folly to enact a plan, which will put additional
pressure on the Federal budget, when we know that the pressures on the
budget from the growth in Medicare and Social Security will greatly
intensify over the same period of time. We are in a time of very strong
economic growth. We should use this opportunity to get our fiscal house
in order so that we can better deal with the fiscal pressures we know
are coming.

tax simplification

This legislation will introduce a new and unwelcome magnitude of
complexity in the lives of ordinary Americans. This at a time when the
public confidence in the IRS is at an all time low and budget cuts for
taxpayer services are sure to come. In 1986, we enacted legislation to
greatly simplify the Code; achieving lower rates and a simplified
structure. This legislation regrettably moves us in the wrong direction
and requires that we pay attention to the Tax Code before we made basic
decisions. In 1996, about half of all tax returns filed were completed
by paid preparers. The child credit, education, and IRA provisions will
result in tax relief but at a cost of increased paperwork for those who
will have to interpret and plan to benefit from these provisions.
A former Treasury official was quoted as saying, ``Who really wins
from the tax bill? The tax-return preparers and the manufacturers of
tax-preparation computer software.'' These provisions could have been
simplified had there not been so much focus on blessing some behavior
and striking political compromises. The current Code is already very
burdensome, this legislation will certainly increase that burden for
many people.

tax fairness

We must have a fair tax system. Many at the top of the income scale
have benefited greatly over the last several years. That is commendable
but we should not enact policies which will accelerate the divergence
between those at the top and the bottom of our economy. This bill will
do that at a time when we can least afford it. A recent analysis of the
bill shows that the average tax cut for middle-income families and
individuals will be less than $200 under this bill. Top income earners
will pay over $16,000 less in taxes each year under this bill. Families
who are in the lowest 20 percent of income are the only group which
will face a tax hike under the bill.
Mrs. MINK of Hawaii. Mr. Speaker, I must register my objections to
H.R. 2014's airline tax provisions which levy a $2 per stop fee which
will be borne mainly by our local short-haul air carriers and their
passengers.
I represent the Second Congressional District of Hawaii, which
includes all of Hawaii's eight major islands. Obviously, the only way
to travel between the islands is by air. Passengers of Hawaii's inter-
island air carriers--Hawaiian Airlines, Aloha Airlines, and Mahalo
Airlines--will be adversely affected by the new $2 per stop charges
under H.R. 2014. A typical round trip ticket from Honolulu to Maui
costs under $100. Now there will be added a new $4 tax. That flight is
less than 20 minutes! A 5,000 mile round trip flight from Washington DC
to San Francisco will also have a $4 stop fee.
These airline tax provisions are clearly unfair to Hawaii's people.
I urge this House to quickly revise this matter and allow Hawaii's
people to be treated equitably.

[[Page H6655]]

Ms. McCARTHY of Missouri. Mr. Speaker, I rise today in support of the
Tax Payer Relief Act of 1997 (H.R. 2014). This historic legislation
provides for needed relief for working families. It achieves a goal of
mine to balance the budget. reduce the deficit, and invest in our
future.
This initiative invests in our children and our future hopes for them
through greater access to health care and educational opportunities.
The education tax provisions will also benefit their parents who seek
to improve and expand their own skills to meet new career challenges in
our global economy. In my community, the metropolitan community
colleges have excelled in connecting our employers with qualified
employees through extensive business and community partnership. The
Vice President visited the business and technology center in my
district last year to highlight their success as a model for our
Nation. This initiative will only enhance the potential of elevating
our work force to the level of competitiveness needed.
One aspect of the legislation important to the people of the fifth
district is the brownfield tax credit. Qualified companies would be
allowed to deduct the costs associated with remediation of contaminated
sites in order to promote development in these areas. In my district
both the Westside Industrial Park conversion of an old train yard into
a useable property, as well as the rejuvenation of the Union Station
project are now closer to reality. In eastern Jackson County these tax
credits will allow for completion of the Jackson County Expressway. The
economic boom created with this new freeway will generate job growth
and economic expansion.
One of the major victories which was accomplished with this
legislation was the rightful return of the dedicated 4.3 cents gasoline
tax to the Transportation Trust Fund. The previous diversion of these
funds unfairly masked the true amount of the deficit. The availability
of these funds for projects in the metropolitan Kansas City area will
afford the opportunity to improve the safety and efficiency of the
highway system and complete critical infrastructure projects such as
the Chouteau Bridge, and the completion of the Bruce R. Watkins
Freeway, which has been 25 years in the making.
Reduction of the capital gains tax for middle class Americans will
keep our economy strong by increasing the capital available to continue
to grow our economy. Reduction in the inheritance taxes will enable
small businesses to stay within families.
We must be vigilant in Congress to ensure that the systems in place
to guarantee the budget is balanced by the year 2002 remain. Similarly,
Congress will have to continue to reduce the deficit through setting
smart spending priorities. Balancing the budget and reducing the
deficit will yield further rewards for our country; deviating from
those worthy goals will threaten to erode value which this tax package
provides for our constituents. Mr. Speaker, I support this bill and
urge its adoption. Thank you.
Mr. KOLBE. Mr. Speaker, I rise in strong support of H.R. 2014, the
Tax Payer Relief Act of 1997.
This is a proud moment for me--to be able to tell the citizens of
Arizona that the U.S. Congress has heard their plea to reduce their
taxes and to balance the budget. In my 13 years here in the House, how
many times have I made that plea on this floor? And today it is really
going to happen.
In terms of the future of this country, the tax incentives for higher
education may be the most important thing we do here today. As we
continue to engage in the global marketplace, education is the factor
that makes our workers more productive and creative. Education is the
key to higher wages and a better standard of living. Reducing the
financial burden on families who want to provide that future for their
children is a step to insuring the viability of our economy for years
to come. A college tuition tax credit, deductible interest on student
loans, a credit for continuing education, extension of employer
provided education assistance--these incentives will be incredibly
valuable in assuring the educated work force we need for the future.
As important as the education incentives are, I don't want to
downplay the $500/child tax credit. An extra $500, $1,000, or $1,500 or
even more in the pockets of families with children up through the age
of 16 will make the lives of those families so much richer. We aren't
giving these parents anything. We are just allowing them to keep that
much more of the money they work so hard to earn for their families--
for clothes, for piano lessons, for braces, for camp, or vacations. And
as pleased as I am that we are letting them keep more, I am troubled by
the fact that I even say those words. Who are we as the Federal
Government to say that people can keep their own money? How did we get
to this place? We must get back to having the people tell us how much
they are willing to give the Federal Government.
Mr. Speaker, at a time when we know we are facing a looming crisis in
payroll taxes and funding Social Security payments, I am especially
pleased that we're letting people keep more of their investments. If
they are thrifty and invest for the future, we are taking less of the
earnings on those investments. We are dropping the top capital gains
tax from 28 percent to 20 percent and eventually there will be an 18-
percent top rate for those investments held for 5 years or more. We are
providing more ways, especially for middle income families, to save for
those retirement years ahead through expanded IRA's. That will make a
tremendous difference for our citizens who want to provide for
themselves after retirement.
We are helping small business with this tax bill. In addition to the
capital gains tax relief, we are exempting them from the alternative
minimum tax. We are phasing in full deductibility for health insurance
premiums for self-employed persons. And there is an immediate jump in
the death tax threshold to $1.3 million for small family farms and
businesses.
There are many, many other excellent provisions in this bill, but I
won't take more time now to itemize what many of my colleagues already
have. I might also say there are a few of the loophole closing
provisions that I don't like--provisions that actually will create tax
burdens where none existed before. And there are some provisions that
will greatly complicate the Tax Code and create still more confusion in
the IRS administration of the tax law. Such complications are bound to
create more dissatisfaction with an already controversial agency.
But, I am pleased that we are taking less in taxes from the American
people. Some on this floor have decried giving back this money. They
are treating it as if it belongs to the Government. It doesn't. It
belongs to the people who pay the taxes and if we think otherwise, it's
time for us to be replaced.
Yesterday's accomplishment, passage of the Balanced Budget Act, will
balance the Federal budget by 2002; save Medicare from bankruptcy, and
shrink the size and scope of Government. It addresses the short-term
financing problem of the Medicare trust fund, and establishes a
national commission to study and make recommendations to ensure the
long-term viability of the important program.
It gives seniors choices in the Medicare Program rather than locking
them into the one-size-fits-all system. Seniors will have the
opportunity to choose from the traditional Medicare Program, or from
the alphabet soup of managed care, or take complete control over their
health and decide what type of medical services best suits their
individual needs through a medical savings account. And most important,
this reform attacks waste, fraud, and abuse in the Medicare Program.
The anti-fraud initiative includes a ``three strikes you're out''
penalty for the worst abusers of the system.
Also, this historic reform increase health care coverage for children
who are uninsured, and gives the States the flexibility to administer a
child health initiatives which work best at the State and local level.
The Balanced Budget Act of 1997 and Taxpayer Relief Act are not
victories of the President or the Congress, they are victories for the
American people.
Mr. CRANE. Mr. Speaker, as vice chairman of the Ways and Means
Committee and as one of the House conferees on the tax bill, it is with
great pleasure that I rise today on the floor of the House of
Representatives to speak in strong support of legislation which will
provide substantial tax relief for the American people. Most
importantly, it appears that this bill, the Taxpayer Relief Act of
1997, will be signed into law and will become the first major tax
relief package the American taxpayer has seen enacted since 1981.
Although it was in 1994 that Republicans gained the majority in the
House of Representatives and started pushing in earnest for a tax cut,
it took us nearly 3 years to finally convince this President that the
American people were in need of real tax relief. Mr. Speaker, on behalf
of the taxpayers of the Eighth Congressional District of Illinois, I'm
glad the President finally got the message.
By now everyone should know the story of the middle class taxpayer.
Today, the typical family devotes more of their family budget to
combined Federal, State, and local taxes than they do to food,
clothing, and housing. Considering this statement, it should come as no
surprise that it is also a fact that Americans are being taxed today at
record high levels. The time to reverse these trends is long overdue,
and the legislation before us today is, I hope, only the first
significant step toward relieving family tax burdens.
What is in the bill before us today? While time does not permit me to
discuss every aspect of this bill in detail, let me start by saying
that families with children will be the big winners. The $500 per child
credit provided in this bill will begin to rebuild the foundation of
take home pay for families with children which has

[[Page H6656]]

been seriously eroded over the past few decades. Indeed, had the
current dependent deduction been indexed for inflation from its
inception, the per child deduction would be over $8,000 rather than in
the $2,500 range that we find today. We needed to do something, whether
it be to dramatically increase the deduction--as I have long
advocated--or provide a credit--as I introduced at the start of the
104th Congress. Relief is provided in this bill.
What else can taxpayers look forward to? The bill will expand
opportunities for Individual Retirement Accounts [IRA's] and provide
for penalty free withdrawals for education and first time homebuyers,
legislation I have cosponsored for years. And the bill provides
substantial education tax incentives.
In addition, the bill substantially provides relief from the death
tax, raising the exempt amount from $600,000 to $1 million by 2007 and
providing, in 1998, an exemption of $1.3 million for small businesses
and family farms. As I have said before, the death tax is an extremely
punitive tax as it penalizes those who have saved, invested, and paid
taxes throughout their lives in the hopes of leaving something for
their loved ones. I look forward to the day when I will never again
hear the story of the family farm being sold to pay the estate tax, and
that is why I will continue with my legislative efforts to eliminate
the death tax entirely.
While allowing the American taxpayer keep more of their hard earned
money will help spur economic growth indirectly, there are several
provisions in this bill which will very directly encourage economic
growth and job creation. The Taxpayer Relief Act reduces the capital
gains tax rate substantially. Encouraging investment in capital will
increase the pool of capital which will in turn increase access and
thus stimulate job growth. another little discussed provision of the
bill will reduce the burden placed on businesses by the alternative
minimum tax [AMT]. This legislation exempts 95 percent of businesses
from having to pay the AMT and it is my hope that members of this
Congress are finally realizing that when they excessively tax
businesses, they are simply increasing the price of products to
consumers, killing jobs and hurting the ability of our businesses to
compete internationally. As with death taxes, my goal is to eventually
eliminate capital gains taxes and the AMT altogether; however, this
bill is a good start in that direction.
Because of the provisions I have just mentioned, this is a bill well
worth passing, despite any further improvements or changes that I might
personally wish to make. While we have certainly heard such rhetoric in
the weeks leading up to this day, I find it refreshing that the class
warfare rhetoric that once dominated floor debate on tax cuts has at
least been toned down to some degree. I would hope that we can finally
put behind us once and for all the divisive class warfare rhetoric that
has resonated all too frequently in this House chamber. The politics of
envy, the politics of division, is simply crass politics that does far
more harm than good. Following my statement I have included in the
Record a copy of an article by Thomas Sowell which further exposes the
shortcomings of the arguments used by those who engage in the class
warfare debate. Again, the time has come to end class warfare
demagoguery once and for all.
Finally, as vice chairman of the Ways and Means Committee, and as one
of the House conferees on the tax bill, I can tell my colleagues that
there is no one, not one person in either the House or the Senate, that
has worked harder or deserves more credit for making this day happen
than my friend, and Chairman of the Ways and Means Committee, Bill
Archer. My Chairman, Bill Archer, has worked tirelessly in these past
months--late nights and weekends--with one goal in mind--to deliver
this tax relief package to the American people. He never lost sight of
the goal and he delivered.

Mr. Speaker, I urge my colleagues to help make Bill Archer's hard
work pay off and deliver this tax bill to the American people with an
overwhelming majority of the vote.

[From the Chicago Sun-Times, July 26, 1997]

Liberals Are Mighty Generous With Definition of `the Rich'

(By Thomas Sowell)

Every year Forbes magazine devotes an issue to the rich--a
listing of the millionaires and billionaires who have the
most money. Liberals in Congress also talk about ``the rich''
whenever anyone wants to lower taxes. Big taxers and big
spenders always like to say that there are ``tax cuts for the
rich.''
The problem is that these two kinds of rich people are
almost entirely different. Most of the people whom
politicians and the media call rich don't have even a tenth
of what it takes to make the Forbes list.
Millions of Americans who never would dream of considering
themselves rich are included in the inflated statistics used
by the liberals who claim that tax cuts are for the rich.
According to a Heritage Foundation study, there are more
than 4 million mechanics, repairmen and construction workers
who must meet the Clinton administration's definition of
rich. So do more than 8 million government employees at
federal, state or local levels.
How do people who are making modest middle-class incomes
suddenly become rich? Let me count the ways.
First of all, the statistics used include money that these
people never receive. These estimates assume that income is
being underreported and add 20 percent to whatever income is
reported. The value of your life insurance and pension fund
also is counted as income.
Anybody can be rich if you add enough fictitious money to
his actual income. As a result, anybody in Congress can be a
demagogue who says that most of the tax cuts are for the
rich. Let's go back to square one. The only people whose
taxes can be cut are people who are paying them. Mostly, that
is the middle class. When these middle-class people are
renamed ``the rich,'' of course there will be ``tax cuts for
the rich.''
The misrepresentation does not stop there. The Clinton
administration's insistence that the tax cuts should also
apply to ``the working poor'' is a classic piece of
disinformation.
Most very low-income families are not paying federal income
taxes in the first place. Extending a ``tax cut'' to them
would mean nothing if the words were being used honestly.
Used politically, however, what these words mean is that more
federal money must be given to them anyway a handout renamed
a tax cut.
None of this addresses the larger question of whether
people making middle-class incomes today have always made
middle-class incomes. Many of those who are called rich not
only are not, they have not even had middle-class incomes all
their lives. They just happen to be in the peak earning years
of their lives--as many younger people currently in the lower
income brackets will be in later years.
The wife of a prosperous doctor hit the nail on the head
when she said she resented people who complained about all
the money that doctors make. She asked: ``Where were they
when we had three children and $85 in the bank?''
Most Americans do not start off in a high income bracket.
They work up to it over the years and reach a peak somewhere
in their 50s or 60s. That is where most of the high income
and wealth in the country is. Census statistics for 1990 show
families headed by someone in the 45- to 64-year-old bracket
earning nearly double the income of families headed by
someone in the 25- to 34-year-old bracket.
When it comes to wealth, the disparity is even greater.
Census data show the net worth of households headed by
someone in the 55- to 64-year-old bracket to be several times
that of households headed by someone under 35.
Most of the people who are called rich could more
accurately be called middle-aged or elderly. They are not a
class. They are an age bracket. When they were younger, they
were usually in a lower income bracket.
The facts are fairly simple. It is the demagoguery that
gets complicated.
Mr. BOEHLERT. Mr. Speaker, I rise in strong support of the tax relief
and balanced budget legislation which we have long promised and have
finally achieved. Today we are going to follow through on our promises
to balance the Federal budget for the first time since 1969 while
providing the first major tax cut since the early 1980's.
I realize that the budget agreement is not perfect, but on balance
its benefits enormously outweigh any flaws.
First and foremost, the budget accord goes a long way in helping
working families make ends meet. Families with young children, under
17, will be able to take advantage of a $500 child tax credit. As these
children get older and enter college, we are going to continue helping
these families with a package of college tax credits, deductions and
other tax incentives to help pay for tuition and pay back school loans.
Should this family own a small business or family farm, we are going
to help them pass along their livelihood to their children. Currently,
many children cannot afford to continue their family business or farm
because they must sell all or part of their family business to pay the
enormous Federal estate tax. To help individuals keep farms and small
businesses in their families, we are raising the estate tax exemption
on family-owned farms and businesses immediately from $600,000 to $1.3
million.
If this family plans on selling their home or some investments they
have made we are going to help them as well. The tax provisions slash
capital gains taxes and creates a major exclusion for the sale of their
principal residence.
Far too many Americans work their entire lives and struggle to make
ends meet as they retire. So, we are helping families save for their
retirement, purchase a home or pay for college through expanded
individual retirement accounts [IRA's].
Millions of seniors depend upon Medicare for their health care.
However, medical inflation and a growing elderly population has

[[Page H6657]]

threatened the solvency of the Medicare trust fund. With this threat
hanging over us, the budget agreement takes immediate and decisive
action to save Medicare while expanding seniors health coverage--both
noble and essential actions. Seniors will benefit from new services
which will cover more preventative screenings and diagnostic tests.
Furthermore, seniors will be able to choose from an array of plans
including medical savings accounts and private unrationed fee for
service plans.
When all is said and done, the American people are the biggest
winners today. We are ensuring that they will continue to enjoy a
strong economy, that we will no longer burden future generations with
our debt, and that in doing so they are going to be able to keep more
of their hard-earned income. Today is a great new beginning for
America.
Mr. COYNE. Mr. Speaker, I rise today in support of H.R. 2014, the
Taxpayer Relief Act of 1997. It is a pleasure to be able to vote for
this legislation today.
First, let me point out that passage of this legislation today has
only been made possible by the deficit reduction packages of 1990 and
1993-bills that together reduced deficits by over $1 trillion. Those
were the real budget balancing votes--they raised taxes and cut
spending. It was not easy to pass those bills, but it was absolutely
necessary to produce a healthy economy and promote economic growth. The
upbeat economic conditions that we are enjoying today are due in no
small part to those bills, and the tax breaks provided in this balanced
budget package are the fruits of the seeds that were sown in 1990 and
1993 by Democratic Congresses.
As a result of the 1990 and 1993 bills, we can provide tax relief
today to millions of working families in districts like mine--hard-
working families with incomes of $20,000 and $30,000, families that
have been struggling with stagnant incomes to make ends meet and give
their children the educational opportunities that will allow them to
have a better life. This legislation will help those families to live
the American dream.
This bill is a substantial improvement over the bill that was passed
by the House last month. Many of the worst provisions in the House
version of this bill have been eliminated or moderated. This
legislation will, for example, provide the full $500 per child family
tax credit to millions of moderate-income households that would not
have received it under the House version of this bill. Students
attending low cost institutions would receive the full $1,500 HOPE
scholarship tax credit under the conference report--unlike the House
bill, where many such students would not have received the full credit.
The conference report also stripped out the antiworker provisions in
the House bill that would have imposed burdensome new responsibilities
on labor unions and allowed companies to classify more employees as
independent contractors.
These improvements are the direct results of the unceasing efforts of
President Clinton and the Democrats in Congress to make this a better
bill. Democratic efforts made the family tax credit available to
millions of moderate income families. As a result of Democratic
persistence and perseverance, the education tax provisions in the bill
will help mainstream Americans, not just the wealthiest families. In
short, Democrats are responsible for shifting the benefits of this bill
from the wealthy to middle-class American families. Likewise, it was
Democratic insistence that eliminated unwise House provisions like the
indexing of capital gains--provisions that would have increased
deficits dramatically in the years after 2002. And Democratic
insistence eliminated the antilabor provisions in the House bill. In
short, President Clinton and the Democrats in Congress made certain
that this legislation contained provisions that will benefit middle-
class Americans.
The bill contains other important benefits for American taxpayers as
well. It allows taxpayers to deduct the interest on their student
loans. It allows parents to deduct their contributions to State-run
prepaid college tuition programs like the one run by the Commonwealth
of Pennsylvania. It allows most homeowners to avoid paying capital
gains on the sale of their homes. In order to help economically
distressed communities, the bill contains tax incentives for private
parties to clean up and redevelop brownfields sites, and it increases
the number of empowerment zones and enterprise communities.
No bill is perfect. Budget reconciliation bills typically contain
scores of provisions, and it would be unrealistic to expect anyone to
be satisfied with each and every provision. I still have concerns about
specific provisions of this bill. But I believe that, taken as a whole,
this legislation will benefit the Nation. Consequently, I intend to
vote in support of this legislation, and I urge my colleagues to do so
as well.
Mr. HOUGHTON. Mr. Speaker, I am very pleased that the conference
report on H.R. 2014 includes a provision to add an exception to the
definition of foreign personal holding company income which would apply
to income derived in or incident to the active conduct by a controlled
foreign corporation of ``a banking, financing, or similar business,''
provided the CFC was predominately engaged in the active conduct of
such business. I am also pleased to note that this provision, section
1175, is based on H.R. 1783, ``The International Tax Simplification for
American Competitiveness Act,'' of which I was the lead sponsor.
The growing interdependence of world financial markets has
highlighted the urgent need to rationalize U.S. tax rules that
undermine the ability of our financial services industry--such as
banks, insurance companies, insurance brokers, and securities firms--to
compete in the international arena. Yet the ability of our companies to
compete is impeded by U.S. tax rules that subject financial services
income derived from the active conduct of a business to antideferral
rules that were originally enacted to reach, and would be more
appropriately limited to, passive investment activities. Section 1175,
like the provision of H.R. 1783 upon which it is based, will remove
that impediment.
I readily acknowledge that this battle is not mine alone, and I
gratefully acknowledge the support of many colleagues from both sides
of the aisle. Section 1175 is a result of the efforts of many members
of the Ways and Means Committee. On May 14, 1997, 23 Ways and Means
members--a clear majority of the committee--wrote to Chairman Archer
stating:

The inequitable treatment of the financial services
industry under current law jeopardizes the international
expansion and competitiveness of all U.S.-based financial
services companies, including commercial banks, securities
firms, insurance companies, insurance brokers, and finance
and credit entities.

By amending the definition of ``foreign personal holding company
income,'' section 1175 helps each of those types of entities to compete
in international markets.
Section 1175 is set to expire after 1 year. I note, however, that the
sunset is a function of revenue concerns, not doubts as to its
substantive merit. I look forward to working next year with the
Chairman of the Ways and Means Committee and my committee colleagues to
make this provision permanent.
Mr. DAVIS of Florida. Mr. Speaker, I rise today in strong support of
H.R. 2014, the Taxpayer Relief Act of 1997. This bill, combined with
the Balanced Budget Act which we passed yesterday, is a major step
toward fulfilling our promise to the American people to put our
Nation's fiscal house in order while providing modest tax relief
targeted toward the middle class.
First, let me make clear that this bill is a vast improvement to the
version of the bill the House passed last month. This conference
agreement ensures that these tax cuts are targeted to hard-working
middle-class Americans and will not explode in the outyears.
My opposition to the original bill was based partially on the fact
that the child credit would have been denied to millions of Americans
who earn under $30,000. These Americans are struggling to make ends
meet and deserve tax relief just like everyone else. Fortunately, after
the insistence of both the Democratic Caucus and the President, the
conference agreement provides these Americans with a child tax credit.
Furthermore, I was extremely concerned that the original version
would have exploded the deficit in the outyears, unraveling all of our
hard work in balancing the budget. While I continue to have concerns
over the lack of enforcement included in this package, I believe the
bill we have before us today is more fiscally responsible and, if we
are vigilant in our efforts to ensure that current estimates translate
into reality, will not only balance the budget in the near term, but
maintain that balance for years to come.
Undoubtedly, the crowning achievement of this tax package is the
unprecedented commitment it makes to education. We all recognize that
in order to compete for high-wage jobs in this era of increased global
competition, our students need more than just a high school diploma.
This bill takes a solid step toward reaching the President's goal of
making the first 2 years of college more accessible.
This bill includes nearly $40 billion of tax credits for hard-working
middle-income Americans to help offset the tremendous costs of higher
education. The bill establishes the HOPE scholarship for the first 2
years of college providing a 100-percent credit for the first $1,000 of
costs for tuition, fees, and books and an additional 50 percent for the
next $1,000. The bill also provides a tax credit worth 20 percent of
$5,000 in tuition expenses for the third and fourth years of college.
These credits will expand access to higher education for millions of
Americans and provide relief for American families struggling to equip
their children with the education necessary to compete in today's
economy.
In addition to these tax credits for college, this bill recognizes
that learning is a lifelong endeavor and with the continuing changes in

[[Page H6658]]

the job market, many Americans are going back to school to enhance
their chances for achievement. This bill extends section 127 of the Tax
Code, allowing workers to exclude from their taxable income up to
$5,250 of employer-provided educational assistance.

These tax provisions, combined with the increase for Pell grants and
the protection of funding for Head Start we passed yesterday, represent
a massive reallocation of our limited resources to education, an
investment that will pay dividends for everyone in our country.
Clearly, this bill, together with the Balanced Budget Act, proves that
we can both balance the budget and invest in our future.
Mr. Speaker, I urge all of my colleagues to support this package of
tax cuts because it represents a reasonable compromise on many issues
and provides relief to millions of hard-working Americans. Including
targeted estate tax relief, an expanded exclusion on the sale of a
home, reinstatement of the home office deduction, and an overall
capital gains tax cut, this package embodies the principles of basic
fairness and will help continue the economic growth which is essential
to balancing the budget.
Mr. PAYNE. Mr. Speaker, I would like to bring attention to the fact
that low-income families in search of tuition assistance benefit very
little from this bill. On the other hand, we have provided substantial
education tax cuts and credits for middle-income and higher income
families. One section of this bill provides a 3-year extension of a tax
exclusion for undergraduate students who are fortunate enough to have
their employers provide them with educational aid. This type of tax
break positively affects the students who are struggling to get a
postsecondary degree and working to pay the bills at the same time. The
bill I introduced in May would have permanently extended this section
and permitted both undergraduate and graduate students to take
advantage of this tax exclusion. I still believe it is important to
include graduate students in this section because they are far more
likely to have employers pay for their education than undergraduates.
It is also imperative to permanently extend this exclusion because our
Nation's students who have their tuition paid for by their employers
need the security that they will not ever be taxed on their education.
It is indeed unfortunate we have not included more education tax breaks
to low-income Americans in this bill who are in just as much, if not
more, need of a tax break as middle- and upper-income Americans.
Mr. COSTELLO. Mr. Speaker, in June, I voted against the Republican
budget reconciliation bill in the House because I had several concerns
about how the legislation would negatively impact many American
citizens. I was especially concerned about the impact on children,
seniors, the poor and hard-working Americans who have difficulty making
ends meet each month or who worry about health care for their families.
The House-passed bill proposed to cut Medicare by $115 billion and
Medicaid by nearly $14 billion over 5 years. I could not in good
conscience support such cuts knowing that the burden would fall
disproportionately on those least able to afford it.
However, I voted for the budget reconciliation conference report
because I believe it represents a far more fair and rational plan to
balance our Federal budget by the year 2002. While I am not pleased
with the level of cuts retained in the agreement for Medicare and
Medicaid, I consider this bill a significant improvement. This
agreement restructures and preserves the Medicare program. It improves
the original plan for Medicare and extends the life of the part A trust
fund for at least 10 years. The agreement provides $1.5 billion to ease
the impact of increased Medicare premiums on low-income seniors.
Negotiators also agreed to eliminate several controversial provisions
from the original bill, including increasing the eligibility age from
65 to 67 and a copay for home health care.
Medicare benefits are also expanded to include mammography coverage,
prostate cancer screening, bone density screening to identify and
prevent osteoporosis, and diabetes management care. In addition, the
conference agreement expands the types of health plans under Medicare
seniors may choose which ensures that seniors have the same health care
choices that other Americans do. It protects Medicare's future by
allowing the kind of choice and competition that has brought down
health care costs in the private sector. Such modernization of Medicare
will help ensure its long-term solvency.
The agreement is also an improvement for Medicaid. Under the original
plan in the House, hospitals in our distinct would have faced serious
threats to their ability to operate efficiently. In fact, at least one
rural hospital in the 12th District of Illinois indicated it may have
been forced to close its doors due to the substantial cuts included in
the reconciliation bill. Many of the hospitals in southern Illinois are
classified as disproportionate share hospitals [DSH] meaning they
receive compensation because a majority of their patients are Medicare
and Medicaid beneficiaries. The Medicare and Medicaid cuts included in
the House version of the budget would have endangered these hospitals.
However, the agreement provides that no State will lose more than 3.5
percent of its DSH payments. In subsequent years the reduction will be
less than 2 percent.
The conference agreement continues Medicaid coverage as an
entitlement for disabled children who are losing their Supplemental
Income benefits as a result of the stricter definition of disability in
the new welfare law. Unlike the House bill which made coverage optional
for States, the conference agreement requires States to continue
Medicaid coverage for these disabled children.
It is a tragedy that 10 million children in this country are without
health coverage. One in three children in Illinois goes without any
health insurance--the majority of these children are from two-income
families. This bill creates a $24 billion program to expand health
insurance coverage for children. Under this initiative 5 million more
children will have access to health care.
The agreement also provides a $500-a-child nonrefundable tax credit
for each child under age 17. Single parents with incomes up to $75,000
and couples with incomes up to $110,000 would be eligible for this tax
credit.
Children and families will also have more educational opportunities
under this agreement as students could receive a tax credit worth 100
percent of the first $1,000 of their college tuition costs, and a
credit worth 50 percent of the second $1,000 of tuition. In the third
and fourth years of college, the student would receive a tax credit
worth 20 percent of $5,000 of tuition expenses.
Children will also benefit from the reduction in estate taxes
included in the tax portion of the reconciliation agreement. I support
this provision because it allows small business owners and farmers $1.3
million in tax-free assets to their heirs. This means family farms and
family businesses can be passed from generation to generation without
heavy tax burdens.
For families and retirees, the agreement lowers the top capital gains
tax rate from 28 percent to 20 percent, and lowers it further to 18
percent for assets held for 5 years after 2000. This is important as
more and more Americans from all income brackets invest their
retirement savings in 401(k) plans or other stock market investment
plans.
In summary, I believe this spending and tax plan will help American
families prosper. As a supporter of a Balanced Budget Amendment, I also
believe this agreement will put our Nation firmly on the path to a
fiscally sound future. A balanced budget by the year 2002 will enable
us to focus on protecting and educating our children and ensuring the
health and retirement of our Nation's seniors and aging baby boomers.
Sound national fiscal policy will also allow our Nation to continue to
be competitive in a growing international marketplace. The initiatives
included in this agreement will help us reach these goals.
Mr. FORBES. Mr. Speaker, when I came to this House in January 1995,
my single most important objective was to obtain real Federal tax
relief for working families in Long Island, and across this great
Nation. Today I will vote to reduce America's tax burden by $94 billion
over the next 5 years. Mr. Speaker, $94 billion may seem like a large
tax reduction, but it pales in comparison to the $600 billion in tax
increases that Americans suffered during the first 4 years of the
1990's. Mr. Speaker, the Taxpayer Relief Act of 1997 is simply a modest
step in the right direction.
Three years ago, when I asked the people of Brookhaven, Smithtown,
Riverhead, Southold, Shelter Island, East Hampton, and Southampton for
the privilege of representing them in the House of Representatives, I
promised them I would work to cut taxes. Indeed, many Members of this
House were elected because of that promise. With this historic,
bipartisan agreement to cut taxes for America's working parents,
students, and senior citizens, we are keeping our promise to the
American people.
This legislation provides tax relief for more than 40 million middle-
income taxpayers with children; cuts capital gains taxes to promote
economic growth; and helps America's children realize their dreams by
making education more affordable. These tax cuts for America's working
families were made possible because the Balanced Budget Act restrains
Federal spending by about $1 trillion over the next 10 years. This
bipartisan tax cut package is a good start in that direction, reducing
the tax burden on working families.
Mr. Speaker, the parents of 102,096 children in my district in
eastern Long Island will save a total of $46,050,924 thanks to this
legislation. Parents earning up to $110,000 will feel the benefit of
this bill almost immediately. This agreement includes a child tax
credit that will reduce their total tax bill by $400 for each of their
children under 17 in 1998, increasing to $500 per child in 1999. To
make higher education more affordable for America's families, this
legislation creates a $1,500 HOPE

[[Page H6659]]

Scholarship for all students who attend the first 2 years of a college
or other postsecondary institution. Also included is a 20-percent
tuition tax credit for college juniors, seniors, graduate students, and
all Americans who take college classes to enhance their skills and
advance their careers.
With the newly created Education Savings Accounts [ESA's], parents
can save for their children's education by making $500 tax-free annual
contributions to an ESA; increasing to $1,000 in 2000. Interest on the
ESA's will accumulate tax-free, and funds may be withdrawn for any K-
12, undergraduate, post-secondary vocational, or graduate education
expense. Finally, there is a student loan interest deduction for up to
$2,500 per year of interest on higher education loans.
Capital gains tax relief is an important victory for many Long Island
homeowners. The budget agreement provides married couples with a
$500,000 capital gains exemption when they sell their homes, with
single-filers eligible for a $250,000 exemption. Many Long Island
homeowners have seen inflation increase the value of their homes over
the years. This much-needed increase in the exemption for home sales
will protect the value of the most important increase that most Long
Islanders will ever make. The budget deal also provides help for
Americans just starting out, by allowing them to make penalty-free
withdrawals from their Individual Retirement Accounts [IRA's] to
purchase their first home.
Mr. Chairman, as a former Regional Director of the Small Business
Administration, I can appreciate the benefits this legislation contains
for the more than 82,000 small businesses on Long Island. An immediate
$1.3 million estate tax exclusion is provided for the heirs of family-
owned small businesses and farms; and the general inheritance tax
exclusion is gradually raised from $600,000 to $1 million over 10
years. On top of the increased exclusion from inheritance taxes and
capital gains tax relief, self-employed small business owners will be
able to deduct 100 percent of their health insurance costs, where they
were able to deduct only 40 percent in the past. We also expanded the
income tax deduction for home offices.

According to the Congressional Budget Office, three-quarters of
American families own assets such as stocks, bonds, homes, real estate,
and businesses that realize capital gains. Last year, nearly two-thirds
of all tax returns that reported capital gains were filed by taxpayers
with incomes less than $50,000 a year. The agreement provides overall
capital gains tax relief by reducing the top rate from 28 percent to 20
percent, with the rate dropping to 10 percent for couples with taxable
incomes under $41,200. After the year 2000, investors who hold their
assets for at least 5 years, will see their rate drop to 18 percent.
Mr. Speaker, I would prefer that these tax cuts were all delivered to
the people immediately, rather than being phased in. We can celebrate
today, but tomorrow we cannot rest. Mr. Speaker, I support this step in
the right direction, but we still have alot of work ahead of us.
Mr. BEREUTER. Mr. Speaker, this Member is extremely pleased with the
recently-agreed-to historic budget agreement which provides the first
Federal tax relief in 16 years in a balanced and fair manner. The
taxpayer Relief Act, which we are considering today, is part of a very
important budget agreement that provides major tax cuts to middle-
income Americans, just as we have always said it would. It is a
balanced, equitable measure that will give direct, immediate tax relief
to low-middle and middle-income Americans.
This Member is especially pleased that H.R. 2014 includes the capital
gains provisions in a balanced tax relief package that will benefit
low-middle and middle-income American families. Also, the $500-per-
child tax credit, a variety of education-related benefits, and
significant increase in inheritance or ``death'' tax exemptions mean
that low- and middle-income families are direct beneficiaries of the
legislation before us. Furthermore, the tax relief package provides for
expanded IRA's which remove some of the barriers imposed by the Tax
Code to private savings, thus encouraging financial planning for
education and first-time home purchases.
This Member would also like to thank his colleagues who assisted in
ensuring that efforts to repeal the ethanol tax exemption have been
defeated. We have stopped the assault on ethanol, and we have kept our
promise to farmers and ethanol producers.
Finally, Mr. Chairman, this Member's only regret is that the Taxpayer
Relief Act does not include prospective indexing of capital gains for
inflation. This provision would have allowed middle-income Americans in
the future to invest with confidence that inflation would not devour
the return on their investments. However, prospective indexing of
capital gains could be accomplished in subsequent legislation and this
Member will support such efforts.
Mr. Speaker, this Member supports the Taxpayer Relief Act and urges
his colleagues to join him in voting ``yes.''
Mr. PACKARD. Mr. Speaker, we surely have come a long way. After 2\1/
2\ years, the Republican Congress and the Democratic administration
have finally agreed on a plan to balance the budget and provide for
America's future. But it was neither the Democrats nor the Republicans
who emerged the victors in the budget battle. It was the American
people. Hard-working, tax-paying citizens have finally won a major
victory. Tax relief has become a reality because the American people
have spoken loudly and we have listened.
Last year, both Republicans and the President made campaign promises
which included tax relief for working Americans and a balanced budget
for America's future. After 2\1/2\ years, we can be proud to say that
together we have fulfilled our promises to the people. A balanced
budget which includes significant tax relief is in hand. This is the
first balanced budget in a generation and the first tax relief in 16
years.
Mr. Speaker, today, we can all rest easy knowing that the President
and the Congress were able to work together to provide a brighter
future for all Americans. Partisan politics were pushed aside; the
people emerged as the big winners.
The specifics of our budget agreement will put more money in your
pockets. Reductions in the capital gains tax, a child tax credit,
educational tax credits, and a decrease in the estate tax rate will
help all Americans live out the American dream. In fact, our plan will
refund to you one-third of the largest peacetime tax hike ever--the
President's 1993 tax increase.
Mr. Speaker, by the end of the 104th Congress, the scorecard on the
Contract With America was impressive: two-thirds of the contract had
become law. Tax relief for families was the crown jewel of the Contract
With America. It didn't happen until this week. But it was well worth
the wait.
Mr. BALLENGER. Mr. Speaker, I rise in support of the conference
report onthe Taxpayer Relief Act which will reduce significantly the
Federal tax burden for the first time in 16 years. Although the
balanced budget agreement promised net tax relief of $85 billion, the
final compromise bill provides for $94 billion in net relief over 5
years and more than $260 billion over 10 years. I applaud Ways and
Means Chairman Bill Archer and ranking member Charlie Rangel for their
leadership and hard work, and the heavy lifting of the entire
committee's staff, I making the tax package a reality.
It is important to remember that there virtually has been no tax
relief since 1981, when President Ronald Reagan lived up to his
campaign promise and delivered a tax cut measure that led us to one of
the biggest economic expansions in our history. In contrast, just 4
years ago, President Clinton gave us the largest tax increase ever,
reversing the progress former President Reagan worked so hard to
deliver. After assuming control of the House and Senate in 1995, the
Republican-led Congress rolled up its sleeves and began the difficult
work of bringing real tax relief to the American people. I like to
think of it as returning to the taxpayers their own hard-earned
dollars.
As has been reported widely, the major benefits of this tax package
will go to families with children. Although it has been a number of
years since my wife and I had children in our home, I see through the
experiences of my daughters the financial challengers of today's young
families. I am pleased that the conference report on the Taxpayer
Relief Act gives parents a $500-per-child tax credit beginning in 1998.
Under this provision, parents with children under the age of 17 will be
eligible for this benefit, providing help to 11 million more children
than what the President wanted since his tax package only provided this
benefit to parents with children 12 years old and under. The second
largest benefit to most families will be the tax-free education savings
accounts which will help them with college or other post-secondary
education for their children.
The conference report on the Taxpayer Relief Act also reduces the
capital gains tax rate from 18 percent to 20 percent for those with
incomes above $41,500 per year and from 15 percent to 10 percent for
those earning below that amount. This measure would benefit three-
quarters of American families who own homes, property, or other capital
goods. Equally important, it would greatly benefit those people who
have worked hard and invested in retirement accounts because their
money now will be taxed at a lower rate.
I also am pleased by the conference report's many contributions to
the owners and employees of America's small businesses. As one who many
years ago started a small business, I can attest to the hard work,
sacrifice, and risks involved in earning a living this way and creating
jobs for others in the community. Today, small business men and women
face more regulatory challenges that I did when I started out. As such,
I believe it is all the more important to minimize the negative effect
of the Tax Code on this engine of the economy

[[Page H6660]]

of my district and the entire country. I wish to acknowledge the work
of Small Business Chairman Jim Talent in promoting the important small
business tax relief which was advocated by the delegates to the most
recent White House Conference on Small Business. I joined in signing
Chairman Talent's letter to the conferees in support of: the home
office deduction; accelerated phase-in to 100 percent of the health
insurance deduction for the self-employed; and estate, capital gains
and alternative minimum tax [AMT] relief for small businesses. Many of
my constituents also will welcome the additional delay in penalties for
electronic filing under the electronic Federal tax payment system.
Finally, I am especially grateful for the ways in which this tax
package clarifies certain of the important pension reforms in last
year's Small Business Job Protection Act. In particular, I was
supportive of provisions in the House and Senate versions of this
measure which were needed to enable subchapter S corporations to
establish employee stock ownership plans [ESOP's], giving the employees
of these small businesses another retirement option. As a long-time
cheerleader for ESOP's, I am enthusiastic over these positive steps to
boost employee ownership which have been taken by the 105th Congress.
Clearly, the Taxpayer Relief Act for 1997 is not a ploy to give a tax
break to the rich, as some of my colleagues would have us believe. It
is a long overdue effort to ease the ever growing tax burden that falls
primarily on middle class taxpayers, robbing these families of their
freedom. While I view this measure as a great start, I will continue to
work with my colleagues to deliver more tax relief and a leaner and
more responsive Federal Government in the future.
Mr. GILMAN. Mr. Speaker, I rise in support of the conference report
to H.R. 2014, the Taxpayers Relief Act. This measure provides a tax
reduction for our Nation's working families, including a $500-per-child
tax credit, $1,500 education tax credit, and a reduction in the capital
gains tax.
I commend my friend and colleague the gentleman from Texas, the
distinguished chairman of our Ways and Means Committee, Mr. Archer as
well as our leadership for producing this bipartisan tax measure.
I would like to highlight a provision of the bill which will benefit
our Nation's police officers and firefighters. Title XV, section 1527
includes a measure, H.R. 1795, which I introduced earlier this session
to rescind the dollar limitation on police and firefighter benefit
plans--allowing these employees to collect the money that they have
rightfully earned by contributing to their pension fund.
Currently, under section 415 of the Tax Code, police officers and
firefighters are not eligible to collect the funds that they have
earned and instead are required to retire with benefits that force
officers to work past their general retirement age in order to afford
the high cost of living on the East Coast and other large metropolitan
and suburban areas throughout the country.
I urge my colleagues to support this bill. Let's be fair to middle
American working families, and to those, who day in and day out, place
their lives on the line for our protection.
Mr. DINGELL. Mr. Speaker, I intend to vote in favor of H.R. 2014
albeit with some reservations. This legislation is the product of great
compromise by both sides. I am pleased that my Republican colleagues
recognized the need to include some tax relief for middle-class
Americans in the final version of the tax plan. However, I am deeply
concerned that this may still explode the deficit in the out years.
The $500-per-child tax credit will be available to low-income
families and the education tax breaks will be fully implemented. We, as
Democrats, fought hard to ensure all families will receive some benefit
from this tax package. Low-income American families deserve the $500-
per-child tax credit just as much as a family whose earnings exceed
$110,000. The HOPE scholarship and the student loan interest deduction
will make higher education more affordable and accessible for all
Americans.
I am still troubled by the distribution of the tax cuts. The capital
gains reductions will allow CEO's to cash in their stock options and
pay less in taxes than a family earning $30,000. It is the unfortunate
nature of compromise that we must cede these generous capital gains tax
breaks to the Republicans to provide some relief for hard working low-
income Americans.
We should defer the self-congratulations until such time as the
budget is actually in balance. The conference agreement is imperfect
and there is a definite possibility that it will destroy the Democrats
work on deficit reduction which began with the 1993 budget agreement.
Nevertheless, I will not stand in the way of the good to reach the
perfect. Insomuch as hard working lower-income American families stand
to benefit through the $500-per-child tax credit and the $31 billion in
education tax cuts, this tax package is good.
Mr. CUNNINGHAM. Mr. Speaker, we are today proudly returning to
Americans more of their hard earned money. I am honored to help provide
the people of San Diego County some long-overdue tax relief, through my
enthusiastic vote for H.R. 2014.
For families with children, we provide relief through a $400-per-
child tax credit next year, and $500 per child in the following years,
and relief to save for college and education and a better future.
For homeowners, we exempt the sale of couples' homes up to $500,000
from the capital gains tax. This will help spur home sales, and
simplify recordkeeping for thousands of San Diego County homeowners.
And for families who save and invest, we have expanded the
availability of IRA's and slashed the capital gains tax. Together,
these initiatives spur more savings and more economic growth.
Together with the bill we passed yesterday, saving Medicare and
controlling Government spending, we are balancing the budget after
years of debts and deficits. What a difference it has made for America
to have a fiscally responsible Republican Congress. Back in 1993,
President Clinton enacted the largest tax increase in American history.
This Republican Congress has brought sense to the Federal budget by
restoring respect for the budgets of the families and businesses that
make America strong and free. And America wins.
As I did when this measure passed the House in June, I want to draw
attention to one particular provision of this package: the 21st Century
Classrooms Act. This provision provides expanded tax incentives for
companies to donate computers and technology to K-12 education. I want
to address why this is so important to our children and our future.
By the year 2000, some 60 percent of U.S. jobs will require technical
skills, twice as many as today. But, as the GAO has reported, our
classrooms lack the technology our children need to succeed. This
measure will spur private enterprise to get involved with local
schools, and to provide them a new source of up-to-date computers and
technology. It ensures that companies have an incentive to donate to
schools, to private foundations involved in education, and to
organizations that refurbish computers for schools so that they are
ready for educational uses.
Just as computers and technology have transformed private enterprise,
they can transform our schools and the education of our children. With
the click of a mouse, a child can go anywhere in the world. With
computer proficiency, a young person can transform a wide variety of
information into a multimedia presentation. With the technology
available today--to say nothing of the technology available tomorrow--a
student can compose music, write and illustrate a short story, study
images of distant worlds, and help dream bigger dreams and build a
better world for the next generation of Americans.
I am optimistic that the 21st Century Classrooms Act can help
transform American education. It will help prepare our young people for
tomorrow. And when this House votes for this tax relief today, it will
help bring new opportunity to the classrooms of America's young people.
We are indebted to the men and women who assembled this package of
tax relief for the American people, including Speaker Gingrich and the
Republican House leadership, Chairmen Archer and Kasich and their
staffs. But we are most indebted to the Americans who pay the way of
this Government. For them, we are providing a tax cut.
Mr. DOYLE. Mr. Speaker, I rise in support of the conference report on
the Taxpayer Relief Act, and I commend the conferees for making
substantial improvements to H.R. 2014, the original bill that was
considered by the House.
I was unable to support H.R. 2014 because it did not provide ample
benefits for the middle class and it would have exploded the deficit in
the outyears. But this conference report is truly a fiscally and
socially responsible tax cut plan. Its costs are controlled in the
coming years because the capital gains indexing has been stripped, and
the Individual Retirement Account benefits have been targeted to
middle-class savers. It is more equitable than H.R. 2014, as it extends
the child tax credit to more families earning under $30,000 a year,
protects the employment status of workers, and provides more help to
families working to pay for their kids' education.
I am particularly pleased that this tax bill contains brownfields tax
incentives and an expansion of the Empowerment Zone program. In
addition, I am grateful to the bipartisan group of over 60 Members of
the House who joined me in urging the conferees to adopt these
initiatives. Although these provisions were not in the House or Senate
tax bill, I applaud the conferees and the administration for agreeing
to include them. Both the brownfields incentive and the Empowerment
Zone expansion will help to spur economic growth and

[[Page H6661]]

spark the redevelopment of distressed communities across the country.
Washington has been home to partisan sniping for decades, and in
recent years it has been consumed in a political war of attrition. In
the winter of 1995/1996, when the Government was shut down and it felt
like animosity and distrust were the only things that the political
parties had in common, it seemed unthinkable that we could come up with
a budget that would be supported by the President and nearly three
quarters of Congress. But this week we have.
No one will find this to be a perfect agreement, and everyone will
agree that there are various changes which we will need to work for
later. For example, I would like to revisit some of the education
provisions, notably the tax increase on TIAA-CREFF pensioners and the
failure to extend employer provided education assistance to graduate
students.
Despite some flaws, I am proud of this budget reconciliation
legislation. This is the most significant accomplishment we have made
since I came to Congress almost 3 years ago. In fact, it is the most
significant accomplishment that Congress has made since most of the
Members of this body have served here. However, it is crucial that we
all recognize that this is not the time for us to sit back and
congratulate ourselves. We have shown what can be accomplished when we
recognize that our shared interests outweigh our political differences.
Now we must push ahead with the momentum we have built with this budget
agreement. There are many great challenges ahead of us, and we are in a
perfect position to work in a bipartisan manner to overcome them.
I urge everyone to look at this not as the end of the game, but as
the beginning. I look forward to continuing to work with colleagues on
both sides of the aisle, and I invite all Members to make this only the
first of many bipartisan achievements.
Mr. SMITH of Texas. Mr. Speaker, the tax bill before the House, the
first in 16 years to cut taxes, is one small step for America's
families, one historic leap for freedom.
It reverses the Nation's direction and points us down a path toward
restoring individual responsibility and accountability.
Can there remain any doubt that individual citizens and their
families are far more capable of making effective decisions for
themselves than can a distant bureaucracy?
Freedom begins with us, with each individual citizen, each family.
On behalf of the people who have sent us here, we today reclaim their
right to decide, to control more of their lives, to direct more of
their children's development and their own futures.
Today we celebrate another step on what remains a long, historic
journey for mankind.
Mrs. FOWLER. Mr. Speaker, I rise in strong support of the Taxpayer
Relief Act.
When I first ran for Congress 4\1/2\ years ago, the goals of
providing long overdue relief to the American taxpayer and balancing
the Federal budget were my paramount priorities. It gives me great
satisfaction to know that, with the action this Congress is taking this
week, we are accomplishing these goals.
With passage of the bill before us today, for the first time in 16
years the American people will be getting the tax relief that they
deserve. This legislation will provide families with a $500-per-child
tax credit; give the economy a boost through capital gains tax
reductions; offer tax credits and other means to help Americans meet
the costs of higher education for themselves and their children; expand
home office deductions; increase contribution limits for Individual
Retirement Accounts; and establish new IRA's that Americans can use to
save more for retirement, education costs, medical expenses, or the
purchase of a first home. It also will provide long awaited death tax
relief, which will help preserve family businesses and farms.
Mr. Speaker, this bipartisan bill is the product of much work on the
part of our leadership, the chairman and members of the House Ways and
Means Committee, their counterparts in the Senate, and the White House,
which came to this effort belatedly but in the end accepted that the
needs of the American people were paramount. First and foremost,
however, I believe it springs from the renewed commitment to fiscal
responsibility and relief for the overburdened American taxpayer that
the Republican majority has championed. I am proud to be a part of the
Congress that has finally brought about this outcome, and urge my
colleagues to support this historic legislation.
Mr. HASTERT. Mr. Speaker, I rise today in support of this landmark
piece of legislation to reduce the taxes of hard-working Americans.
Just as yesterday, I was proud to vote for a balanced budget and a
program to save Medicare, today we continue to fulfill our promise to
the American people.
Congressional Republicans have kept their word. For the first time in
a generation, the Congress has passed and will have signed into law a
balanced Federal budget. More important, this historic agreement
extends well beyond the Washington beltway; it truly will benefit our
Nation's children, working families, and senior citizens. It provides
middle-class tax relief and saves Medicare while giving seniors choice.
The American people are the real winners in this budget accord.
We've saved Medicare through the early part of the 21st Century. As
one of the budget negotiators on Medicare, I'm particularly pleased
that we've been able to preserve the health care system relied upon by
nearly 40 million older Americans. We do so without raising the
retirement age or cutting benefits. Instead, our plan increased
services and benefits so seniors can choose the best health care plan
to fit their own personal needs. No more one-size-fits-all Washington
approach. And, this is just one of the positive changes in this budget
agreement.
We've following through on our commitment of tax relief for hard-
working Americans. Not sine 1981 has the Congress passed and the
President signed into law tax relief for working families. And, why
not? Families can decide how to spend their money better than Uncle
Sam. By standing up to the tax man, we're standing up for hard-working
American families.
Mr. Speaker, I'd like to take a few moments to point out the
particular features of this comprehensive tax relief package which will
help all folks get ahead in their pursuit of the American dream.
Families will benefit through the child tax credit--the cornerstone
of our tax relief package. This helps young folks like the working
mother in Dixon who called my office this week. She explained how she
desperately needs the child tax credit to help pay for food, clothing,
and health insurance for her four kids. With a $400 child tax credit in
the first year, she'll be able to write off $1,600 from the family tax
bill. In the second year, the kid credit bumps up to $500 per child
which means her family can then write off a whopping $2,000 from their
tax bill. Now that's much-needed and much-deserved tax relief as the
conservative Congress continues to change Washington.
Farmers and small businesses also will benefit from this balanced
budget. By reducing the death tax and providing capital gains relief,
we'll end triple taxation, expand economic opportunities, and bring new
jobs and stable prosperity to working folks around the country.
Finally, I simply want to point out how far we've come in a few short
years. Since Republicans took the majority in 1994, we've been able to
cut Federal spending by $100 billion in 3 short years. We've also
reformed the Nation's welfare system by giving a handup as opposed to a
handout to our neediest citizens. We've also encouraged personal
responsibility on the able-bodied by placing time limitations and work
requirements on any future benefits.
Now, we take another giant leap for smarter government and
conservative, common sense solutions. Instead of talking about
balancing the budget, saving Medicare, and providing tax relief, we've
turned the discussion into how to do it. This is a significant
development and conservative achievement, but there's still a long way
to go. We must continue to ensure the long-term solvency of Medicare
and Social Security. We must ensure continued tax relief for America's
families and employers. We must continue to ensure that the budget
stays balanced and that we begin to pay off our enormous national debt.
I look forward to continuing my commitment to get the job done right as
I was elected to do because this is the people's agenda and much work
remains.
Mr. Speaker, I yield 5 minutes to the majority leader of the House,
the gentleman from Texas [Mr. Armey].
Mr. ARMEY. Mr. Speaker, I thank the gentleman for yielding me this
time.
Let me begin by paying my compliments to all the Members of the
House, particularly those on the Committee on Ways and Means that
worked so long and hard on this bill. Let me appreciate what they have
done.
Mr. Speaker, this is a day when this Congress has an opportunity to
stand up and say, ``Mr. and Mrs. America, we know who you are, we
understand your goodness and we respect your decency. And, Mr. and Mrs.
America, we know who we are. We are not the ones who govern you but,
instead, we are those who represent you. In short, Mr. and Mrs.
America, we are you. It is our job to know who you are, to understand
your hopes and dreams, to share with you your hopes for this great
Nation, and to care with you your hopes for your children.''
It is our job to appreciate all that this great Nation does to not
only build itself into a great Nation but to support a great government
that is determined to act on behalf of these great people. And today we
do that with this bill.

[[Page H6662]]

We start off by saying to all the working men and women of this
country, ``We understand it is your money. You let us use your money on
your behalf. We hope that we do with your money things that you
understand must need be done and should be done, as a reflection of
your compassion, your generosity, your sharing and your caring for your
neighbors and for the greatness of your Nation.''
And we have done these things. But now we find ourselves at a time
where we can say it is time to let the American people keep more of
their money and for us to take less of it.
It is time for Mr. and Mrs. America, as they struggle with the needs
of their family which they desire and hope and must put first, that
they would have a $500-per-child tax credit so that they can do the
things for their children that they know must be done, whether it is
buying the diapers; whether it is, in fact, paying for some
kindergarten, some preschooling; whether it is that day when they are
13 and the Department of Agriculture says the cost goes up by $1,000;
when they take them for their braces. Whatever they decide they must do
with their money, they should have $500 more back for themselves and
their children.
It is time that we recognize that they truly do want to save for and
provide for their own children's education, and they should be rewarded
and encouraged in the effort that they make with the expansion of IRAs.
It is time that we understand that their dream is in fact to own their
own house, and they should be facilitated in that with this tax law.
More importantly, their dream is the day when their youngsters come
home and say, ``Mom, Dad, I got the job, and I am going to have my own
house and I will have my own life.''
And it is time, then, that we realize they need an economy with the
vitality, the generosity, the creativity and the energy to give their
children a chance to work out, in their own lives, their hopes and
dreams in accordance with the training, the education that we have been
so generously giving them.
We pass today a tax bill that says to the men and women of this
country who work hard, who play by the rules, ``It is your money. You
keep more of it, you know better what to do with it,'' and we honor and
respect that.
This is a bill that we must vote ``yes'' for. We must take pride in
our willingness to do that. To vote any other vote than ``yes'' is to
say to the men and women of this country, ``We do not know you, we do
not appreciate you, we do not respect you.'' And nobody given the
privilege to represent the good people of this Nation, in good
conscience, can vote ``no'' and make that statement.

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