[Congressional Record Volume 144, Number 103 (Tuesday, July 28, 1998)]
[Senate]
[Pages S9113-S9130]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
TREASURY AND GENERAL GOVERNMENT APPROPRIATIONS ACT, 1999
The Senate continued with the consideration of the bill.
Amendment No. 3355
Mr. CAMPBELL. Mr. President, I ask unanimous consent the Senate now
consider amendment No. 3355, offered by Senator Kohl, and that I be
added as a cosponsor. I urge this amendment be adopted. There is
support by both sides of the aisle.
The PRESIDING OFFICER. Without objection, it is so ordered. The
amendment is agreed to.
The amendment (No. 3355) was agreed to.
Mr. CAMPBELL. Mr. President, I yield time to Senator Hutchinson for
the purpose of offering an amendment.
The PRESIDING OFFICER. The Senator from Arkansas.
Tax Code Sunset Amendment
Mr. HUTCHINSON. Mr. President, shortly I will call up the Tax Code
sunsetting amendment. I ask unanimous consent to add the following
cosponsors: Senator Brownback, Senator McCain, Senator Abraham, Senator
Inhofe, Senator Grams, Senator Smith of New Hampshire, Senator Helms,
Senator Murkowski, Senator Coats, Senator Sessions, and Senator
Coverdell.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. HUTCHINSON. Mr. President, I congratulate the Senator from
Colorado for his leadership on this appropriations bill, his leadership
on tax reform in this Congress, and his support for the provision
sunsetting the Tax Code. The amendment I will be offering on behalf of
myself and Senator Brownback would sunset the entire Tax Code, December
31, 2002. I appreciate so much the Senator from Colorado in his
cosponsorship of the original legislation that was introduced, and his
support of this very, very important concept.
I also point out to my colleagues, with my appreciation, the various
organizations that have endorsed the scrapping of the code, the
sunsetting, the terminating of the existing Tax Code. The Americans for
Hope, Growth and Opportunity, the National Taxpayers Union, the
National Federation of Independent Business, the American Conservative
Union, Americans for Tax Reform, and Citizens for a Sound Economy have
all lent their support for what I think is an essential step for all of
us who believe the existing Tax Code does not work for the American
people, and that the first step in replacing it with something that is
simpler and something that is more fair and something that is less of a
burden upon the American people would be to set a date certain in which
we terminate and sunset the existing Tax Code.
Congress recently took an important step to protect the American
people from an overarching IRS. In the House, and in the Senate under
the leadership of the distinguished Finance Committee chairman, Senator
Roth, Congress passed the Internal Revenue Service Restructuring and
Reform Act. Under this legislation, the burden of proof has now been
shifted to the IRS. A newly restructured IRS will now be overseen by an
independent panel, and I commend the work of the Senate Finance
Committee and Chairman Roth for bringing this proposal to fruition.
But this legislation, which I firmly supported, must not be the end
of protecting the American taxpayer. On April 2, 1998, the Senate
expressed itself on the need for fundamental change in passing an
amendment to the budget resolution, not only to restructure the IRS but
also to terminate and sunset the Federal Tax Code by the end of 2001.
We passed that sense-of-the-Senate resolution, and we have a list of
all of those who voted for that sense-of-the-Senate resolution saying
we should sunset, we should set a date certain, and we should terminate
the existing Tax Code. I invite all my colleagues in the Senate to look
at that list of those who voted, on both sides of the aisle, on a
bipartisan basis, to sunset the Tax Code.
The House took a bold stride beyond this sense of the Senate in
passing the Tax Code Termination Act on June 17, 1998.
Today, the Senate has the opportunity to do the same. The amendment
I, along with Senator Brownback and all of our cosponsors, have offered
to the Treasury-Postal appropriations bill, that we will be calling up
soon, would eliminate the Tax Code by December 31, 2002. Originally,
way back
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last year, the original bill introduced would have sunset it back in
the year 2000. Then there was an agreement among all the cosponsors to
move that to December 31, 2001, to respond to those who said that is
not enough time and the new Congress would not have enough time to
enact comprehensive tax reform.
Now, in the spirit of being as responsible as possible, and
responding to, I think, the misguided and flawed allegations of the
administration concerning Tax Code termination, we have moved that date
to December 31, 2002. That allows us 4\1/2\ years in order to write a
new Tax Code. We say, in this amendment, that it should be in place
July 4, prior to the sunset date.
I know the Department of the Treasury, Mr. Rubin, has sent a letter
out. Everybody, I am sure, will have seen this letter opposing this
amendment, saying the President is going to veto this appropriations
bill if the amendment is attached. It is not the first time that those
kinds of threats have been made. It is, if you will read the letter,
based upon misguided and flawed assumptions, making all kinds of
assumptions as to what might be enacted or what might not be enacted at
the time of the sunset date.
So I believe what we are proposing is eminently responsible. So we
need to join, I believe, the House of Representatives in passing this
sunset date. It would allow the Social Security provisions, Medicare,
and the Railroad Retirement Board to remain. But we would say the
Congress, the President, the American people would replace the current
Tax Code with a lean and honest system by no later than Independence
Day, July 4, 2002.
For too long, the American people have suffered under the chains of
the oppressive regime we call our Federal Tax Code. It is just not
enough to reform the IRS when the more fundamental problem is the Tax
Code that we ask them to enforce. Each year, Americans spend over 5.4
billion hours slaving away to comply with tax provisions, the
equivalent amount of time it takes to produce all of the cars in this
country, all of the trucks in this country, to manufacture all of the
airplanes in this country for a year. That is how much time we ask the
American people to spend just trying to comply with complicated,
arcane, and inexplicable tax provisions. A humble family of four will
spend the equivalent of 2 weeks just for Tax Code compliance.
Ironically, every year $13.7 billion of the money that taxpayers
struggle to pay the Federal Government is spent enforcing tax laws, yet
the IRS, the bureaucracy of 110,000 people in over 650 offices
nationwide, provides misinformation one-fourth of the time taxpayers
call to seek assistance.
Not too long ago, Money magazine did, as they do every year, an
interesting study. They found this: 45, the number of professional tax
preparers who came up with different answers when asked by Money
magazine, in 1997, to fill out a hypothetical family's 1996 tax return.
That was the April 1997 edition of Money magazine. They found that 45
professional tax preparers, with the same information, came up with
different answers on a hypothetical family's tax return. I think that
is powerful evidence that we have a Tax Code that even the
professionals cannot understand.
They found also that the average hourly fee charged by professional
tax preparers who came up with the 45 wrong answers is $81 an hour.
That is what the American people are paying professional tax preparers
who come up with the wrong answers time and time again.
Mr. President, 6.4 million--that is the number of taxpayers who
visited IRS customer service centers seeking answers to their tax
questions in 1996. Over 6 million, according to the General Accounting
Office, actually went to the IRS customer service centers seeking
answers.
Another figure, though, is 99 million, because it was 99 million
taxpayers who called the IRS hotlines in 1996 seeking answers to
questions about how they could comply with this complicated Tax Code;
99 million, one-fourth of them getting incorrect answers from the
Internal Revenue Service.
The Tax Code is not a stagnant creature. This code has mutated from
its original form into an 800,000-word, 7,500-page monster preying on
the American taxpayer. We in Congress are culpable for this feeding
frenzy, for even in our attempts of incremental reform, even in our
attempts to help the American taxpayer, we have made the Tax Code more
complex.
In 1997, Congress made serious attempts to ease the burdens of the
American taxpayer. It was the first significant tax cut, I think, in 16
years. Yet, even in those efforts to provide tax relief, we unwittingly
created new complications. I think everyone in this body would agree if
we somehow could just start over and write a tax code, there is not one
of us who would say, ``Write the Tax Code the way we have it now,''
because it has been a creation of these incremental changes made by
special interest groups who had enough power to get that change enacted
into law.
We need to terminate, not complicate, the Tax Code. If you look at
this chart, it says:
The number of new sections in the Tax Code created by the
1997 Budget Act--
This was our Tax Relief Act--we created 285 new sections.
The number of changes in the Tax Code accompanying the 1997 tax cut,
824, and the number of pages needed by the Research Institute of
America to explain the changes in the tax law of 1997 was 3,132 pages.
It was a lawyer's dream and tax accountant's dream when we passed that
Tax Relief Act.
While the American people were glad to receive some tax cuts --the
$500-per-child tax cut, the change in the estate tax laws, change in
the capital gains tax laws--the fact is, the great winners were the tax
lawyers and the accountants--3,132 pages just to explain what we did in
cutting taxes.
The American people have called for this termination, this
comprehensive reform of our tax laws. A recent poll that was conducted
by the Americans for Hope, Growth and Opportunity discovered several
things. In asking the question, ``Do you approve or disapprove of a new
Federal law to abolish the current tax system and require that a new
Federal tax system be approved by Congress by July 4, 2001, and that
this new system should then take effect 6 months after that date?''
The response was 48.9 percent approved of that proposition, which we
are going to be voting on, while only 24.1 percent disapproved. By a
margin of 2 to 1, the American people are saying we ought to set a date
certain. Six months prior to that date certain, we should have a new
comprehensive fair tax system in place.
The poll went ahead: ``Do you approve or disapprove of a new Federal
law to abolish the current tax system and require that a new Federal
tax system be approved by Congress July 4, 2002?''
Overwhelming support.
They asked this question: ``If you knew that Congress passed a law to
create a new Federal Tax Code with the following specific principles:
apply one low tax rate to all Americans; provide tax relief for working
Americans; protect the rights of taxpayers and reduce tax collection
abuses; eliminate bias against savings and investment; promote economic
growth and job creation; and not penalize marriage or families--do you
believe it is possible that Congress could accomplish these goals?''
That was the question, and 57.3 percent of Americans answered yes,
with 34.1 percent saying no, and 8.6 percent saying they did not know
or refusing to answer.
That is really quite remarkable, because what that response tells us
is that the American people still have faith that their elected
representatives can and should replace the current tax system with a
simpler, fairer system. They think we can do it.
Americans rapidly, though, I believe are reaching the level of
outrage about this tax cut that would resemble even the kind of tax
rebellion that occurred in the early days of this Republic in 1776. As
an aside, I offer my own statistic. No official poll. No Gallup. No
scientific sample. But I suggest this: That 100 percent of the people
in this country and 100 Senators in this institution believe that an
overhaul of the tax system is overdue and that it should occur.
Mr. President, in the Senate today, we have three options before us--
and I can't find another--we have these three options confronting every
Senator in
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this body: We can ignore the plight of the American taxpayer and do
nothing. That is what we have done for far too long. We have done
nothing. We have passed resolutions. We have passed sense of the
Senates. We have made speeches, and we have debated. We have introduced
bills, and we have even passed tax cuts that further complicated the
Tax Code. But in the end, what we have really done about comprehensive
tax reform is nothing.
Tonight we have that option before us. We can continue to do nothing.
We can vote down this amendment to the Treasury-Postal appropriations
bill, or we can move to table it when it is offered, and we can go down
the path of defending the status quo. I suspect there will be a lot of
my colleagues who will make that choice tonight.
Or we can implement incremental reforms and try our best to make
repairs to a house built on shifting sand as we have almost every year
for the last 12 years. In fact, one study found that since 1913, since
the institution of the income tax, we have added about 100 pages to the
Tax Code every year; on average, 100 pages are added to the Tax Code.
We can continue to do that. We can continue to make small incremental
changes in this complicated Tax Code and hope that somehow we are able
to repair this house that is built on shifting sand. I do not believe
that is a viable option.
This is the third thing we can do: We can lay a solid foundation for
a new house by voting for real reform, the termination of the current
Tax Code. I believe the choice is clear.
Secretary Rubin, President Clinton and other critics of this proposal
will say that sunsetting is reckless. I suggest that when the opponents
of this rise to oppose this amendment, that is what we are going to
hear: ``This is a reckless proposal.'' We will hear it over and over.
They have characterized it as irresponsible, reckless, certain to
cause uncertainty. The President wants to pretend that sunsetting
provisions are somehow unusual, somehow irresponsible. They are
neither. He would have us believe they create paralyzing uncertainty,
and yet if you will look at the sunset provisions that we have in law,
all major spending legislation is sunsetted. We recently debated
legislation to replace both the Higher Education Act and the Intermodal
Surface Transportation Efficiency Act, the ISTEA bill, both of which
expired this year due to sunset provisions included in the original
legislation. All major spending legislation contains sunsetting
provisions. Sunsetting forces Congress to periodically review the
merits, effectiveness and efficiency of the programs it creates. Only
then can these programs be continued.
In testimony before Congress, Alan Greenspan expressed his support
for the concept of sunsetting. He is the guru, many believe, of the
unprecedented period of economic expansion, but he said he believed
that everything in Government should face these sunset provisions.
The President has said he believes sunsetting will cause instability.
I believe we are going to hear that. He imagines that the current tax
system is somehow stable. The truth is, the current Tax Code is riddled
with uncertainty. The only certainty in this system is that it will
become more complex through incremental reform and that special
interests will thread their way through these special loopholes.
To my colleagues who say this is going to create uncertainty, this is
my response: If you believe that we need to get from where we are to a
simpler, fairer tax system, there is no way, I suggest, to get from
where we are to where we all want to be without some degree of
uncertainty. You cannot replace this entire Tax Code, no matter how
incremental you may do it, over a long period of time without there
being certain uncertainties in markets or business planning or
whatever.
But I suggest what Senator Brownback and myself have proposed is the
most rational way to get from where we are to comprehensive tax reform.
Because we allow 4\1/2\ years, we set a date certain, we ensure that
there are going to be proper oversight hearings by the Finance
Committee, that all of the various proposals that have been submitted
will have ample time for debate, and that the American people and the
American business community will have adequate time to plan for the
changes that will be enacted.
I would assume that those changes would be phased in over a period of
years as well. But what we have proposed is eminently responsible, not
going to create uncertainty, and is not reckless. It is only those who
want to defend the status quo, I believe, who throw out those kinds of
arguments.
I have a number of other points I would like to make, and perhaps as
the debate goes on I will have an opportunity to do that. I know there
are a number of others who are cosponsors of this legislation who will
be wanting to seek recognition.
Senator Warner has requested a period of time to discuss the Capitol
security program and the new visitor center. I know that is something
that is heavy on all of our minds today. And Senator Brownback is
certainly willing to postpone his comments.
At this point I yield the floor.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Colorado.
Mr. CAMPBELL. We have several Senators who want to speak in
opposition to this amendment who are not on the floor yet, but I ask
unanimous consent that we lay the present amendment aside for the
purpose of allowing Senator Warner from Virginia to introduce another
amendment.
The PRESIDING OFFICER. The amendment has not yet been offered.
Amendment No. 3356
(Purpose: To require the Administrator of General Services to acquire a
lease for the Department of Transportation headquarters and to provide
additional funding for security for the Capitol complex)
Mr. CAMPBELL. Mr. President, I send an amendment to the desk and ask
for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:
The Senator from Colorado [Mr. Campbell], for Mr. Chafee,
for himself, Mr. Warner and Mr. Baucus, proposes an amendment
numbered 3356.
Mr. CAMPBELL. I ask unanimous consent reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
On page 47, strike lines 11 and 12.
On page 62, between lines 19 and 20, insert the following:
SEC. 4____. DEPARTMENT OF TRANSPORTATION HEADQUARTERS.
(a) In General.--The Administrator of General Services,
without further review or approval by any other office of the
executive branch, shall--
(1) acquire an operating lease for the Department of
Transportation headquarters; and
(2) commence procurement of the lease not later than
November 1, 1998;
in accordance with the authorizing resolutions passed by the
Committee on Environment and Public Works of the Senate on
November 6, 1997, and the Committee on Transportation and
Infrastructure of the House of Representatives on July 23,
1997.
(b) Authorization To Reduce Annual Lease Amounts.--In order
to procure an operating lease, the Administrator of General
Services shall reduce the annual lease amounts authorized by
the resolutions to such extent as is necessary to effectuate
an operating lease at the time at which the lease is
executed.
SEC. 4____. SECURITY OF CAPITOL COMPLEX.
There is appropriated to the Architect of the Capitol for
costs associated with the security of the Capitol complex
$14,105,000.
Mr. CAMPBELL. Mr. President, this amendment deals with the Department
of Transportation headquarters and redirects the funds for Capitol
security. I know Senator Warner would like to speak to this. I yield
him time.
Mr. WARNER addressed the Chair.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. WARNER. Mr. President, I thank the distinguished managers of the
bill. I will speak to the amendment. I would suggest, however, as I am
speaking, that the distinguished managers look at what possibly could
be a rewrite of the bill; and then at such time, if you agree, we will
substitute this for the one that is at the desk.
Mr. President, I wish to just speak briefly, as chairman of the Rules
Committee, on behalf of the work that our committee has been doing
since I have been privileged to take over the chairmanship.
We have been looking at, first, a program by which the security of
the overall square here--we call it a square--
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both the building security and the outside security can be enhanced.
There is an ongoing--almost weekly--meeting on security at some level
in this system. The Rules Committee has given the clearest instructions
to the Architect of the Capitol, indeed, to the chief of the police,
and others, to bring to the attention of the committee, and others, any
new type of equipment or concept that can help improve the security of
the Nation's Capitol. That has been done, and done very, very well.
On August 20 of last year--about a year ago--a plan was put forward
entitled ``United States Capitol Square Perimeter Security Plan.'' A
hearing was held before my committee, the Rules Committee, on September
25, and the Rules Committee accepted the plan on November 4, 1997. It
was a concept to upgrade the security on the exterior of the building.
Mr. President, I ask unanimous consent that an executive summary of
that report be printed in the Record.
There being no objection, the summary was ordered to be printed in
the Record, as follows:
United States Capitol Square Perimeter Security--Executive Summary
This report was prepared by the Task Force appointed by the
Capitol Police Board (CPB). The membership of the Task Force
consists of representatives of the House and Senate Sergeants
at Arms, the U.S. Capitol Police and the Architect of the
Capitol. Technical support was provided by outside security
and architectural consultants.
In light of recent incidents at other public and private
facilities, the CPB charged the Task Force with developing
options for improved perimeter security at Capitol Square.
The options were to incorporate the best available
technology, blend with the existing historic Frederick Law
Olmsted landscape design and provide for an appropriate and
cost effective coupling of these improvements with the
security concepts and criteria employed in the design of the
proposed U.S. Capitol Visitor Center (CVC).
Four preliminary schemes were developed for evaluation by
the Task Force ranging from the simple replacement of the
concrete sewer pipes and planters with bollards to an
extensive perimeter fence concept that enclosed Capitol
Square behind the appropriately designed security barrier.
Of the four schemes, one was chosen for development and
forms the basis for the recommendations. The recommended
scheme will work within the current constraints of the site
and will also support the CVC concept when executed.
The recommended and preliminary schemes built upon the
concepts developed in the late 1980's that came to be known
as the ``Whip's Plan'' and expanded those concepts to
incorporate the proposed CVC and improved security
technology. The primary focus of the current effort is to
enhance the deterrents, detection and response capabilities
of security systems both existing and planned. In addition,
support was also provided by the U.S. Secret Service and
other law enforcement entities with overlapping
jurisdictional concerns.
* * * * *
Standards for systems, hardware and physical barrier
devices were developed as part of the process. These
standards are included in the recommended scheme. The systems
and other security methodologies used in the recommended
scheme for Capitol Square have been organized in a manner
that will enable them to be deployed consistently through the
Capitol complex.
In that regard, a schematic design was also prepared that
eliminates the unsightly concrete ``Jersey' barriers,
commonly used along highways, from around the Russell,
Dirksen and Hart Senate Office Buildings and replaces them
with landscaped roundabouts similar to those being proposed
for the North and South Entrances of the U.S. Capitol
Building. The designs for both Capitol Square and the
exterior areas around the Senate Office Buildings are
proposed with thoughtful landscape treatments consistent with
existing architectural openness and aesthetics that typifies
the Capitol complex today. This work is shown to test and
expand the concepts on sites contiguous to Capitol Square.
* * * * *
Mr. WARNER, Mr. President, integral to that plan is a visitor center
which, while it has been considered separately, it is to be tied in
with the overall Capitol security plan.
Tomorrow, the Rules Committee will, hopefully, proceed with a markup
of a redraft of a bill submitted by the distinguished majority leader,
the minority leader, and myself several months ago. There are meetings
going on right now with the Speaker, with the majority leader, and,
indeed, their counterparts in the minority, to try to get some
refinements to the concept which, hopefully, will be put into the
markup tomorrow before the Rules Committee.
I am proud to say the Senate has been moving with steady, firm
momentum on this whole concept of security--both external and
internal--for some months now.
I ask unanimous consent that a letter to the distinguished Senator
Ben Nighthorse Campbell from myself and others asking that this
particular amendment reflect the change of the status of the funds
which is in the amendment--it is in section 4, ``Security Of Capitol
Complex . . . is appropriated to the Architect of the Capitol for costs
associated with the security of the Capitol complex $14,105,000.''
There being no objection, the letter was ordered to be printed in the
Record, as follows:
U.S. Senate, Committee on
Environment and Public Works,
Washington, DC, July 27, 1998.
Hon. Ben Nighthorse Campbell,
Chairman, Subcommittee on Treasury, Postal Service, and
General Government, Dirksen Senate Office Building,
Washington, DC.
Hon. Herb Kohl,
Ranking Member, Subcommittee on Treasury, Postal Service, and
General Government, Dirksen Senate Office Building,
Washington, DC.
Dear Chairman Campbell and Ranking Member Kohl: We write to
request your assistance in resolving an important matter
involving the U.S. Department of Transportation (DOT), its
thousands of headquarters employees, and the taxpayers.
As you know, the Committee on Environment and Public Works,
at the Administration's behest and the personal request of
the Secretary of Transportation, has been working to
authorize suitable housing arrangements for DOT headquarters.
DOT currently occupies the Nassif Building, which has been
under Federal lease for nearly 30 years. However, the
building is inadequate for DOT needs and may pose health
concerns for the 5,600 DOT employees who work at that
location.
The lease on the Nassif Building expires in March of 2000,
presenting the government with an opportunity to obtain new
housing for DOT. Toward that end, on November 6, 1997, the
Committee approved a resolution authorizing the General
Services Administration (GSA) to enter into a long-term
operating lease for a headquarters building, with the
possibility of government ownership at a later point. The
terms of the Committee's resolution were based on discussions
with, and approved by, Administration officials.
Since that time, however, the Administration has changed
its position and prefers a government owned building. Its
FY99 budget request included $14.1 million for the design
costs associated with the construction of a new government-
owned building. This change has resulted in an eight month
delay--a delay that has meant no relief for DOT employees,
and is threatening to result in significantly higher interim
lease payments by the government.
More importantly, while construction of a government-owned
building may be a cost-effective solution to DOT's housing
needs over the long term, we are concerned that such an
option is not realistic in light of our limited budgetary
resources. Frankly, we are skeptical that the $300 million
necessary for construction of a government-owned building
will be made available over the next few years, given the
backlog for priority courthouse construction. Should the
money become available, however, the Committee's resolution
explicitly invites the Administration to return to request
authority for government ownership. We have expressed these
views in recent meetings and discussions with Administration
officials from DOT, GSA, and the Office of Management and
Budget (OMB).
Therefore, we believe that it is critical for GSA to move
ahead immediately with the lease procurement. Toward that
end, we would propose to work with you and your staff to
include language in S. 2312 that would ensure that the
Solicitation for Offers goes forward. Furthermore, in order
to send a clear and unambiguous signal to the Administration
to proceed expeditiously, we request that the current earmark
of $14.1 million for design of a new DOT building be deleted.
We consider this request to be of the utmost importance, as
we wish to resolve this situation for the benefit of the
Department, DOT employees, and the taxpayer.
We appreciate your consideration of our request. Attached
is the text of our proposed amendment; we look forward to
working with you toward a satisfactory resolution.
Sincerely,
Max Baucus, John Warner, Bob Graham, Daniel Moynihan, Joe
Lieberman, James Inhofe, Craig Thomas, Kit Bond, Frank
R. Lautenberg, John H. Chafee, Tim Hutchinson, Wayne
Allard, Dirk Kempthorne, Barbara Boxer, Ron Wylen, Jeff
Sessions, Bob Smith.
Mr. WARNER. The amendment is really twofold: one, to transfer those
funds; and, secondly, to establish a procedure by which the other
problem can be taken care of. I know right now the manager of the bill
is comparing the two amendments.
I believe our distinguished chairman of the full committee, Senator
Chafee,
[[Page S9117]]
is here to speak to the DOT headquarters issue.
Mr. CHAFEE addressed the Chair.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. CHAFEE. It is incorporated in the amendment. It is my
understanding that this amendment regarding the DOT building and the
lease arrangement is acceptable by the managers. While I----
Mr. WARNER. That is correct. Could I finish my statement and then you
address that?
Mr. CHAFEE. I have nothing further to say. If they are prepared to
take that part, I am delighted.
Mr. WARNER. That is correct. I thank the chairman, and I appreciate
his work.
The funds are transferred. As soon as we can reconcile some minor
technical differences between the amendment at the desk and another
copy, I say to our chairman, we will soon vote on that amendment. The
letter I just had printed in the Record sets forth the chronology.
Now, the reason that we are transferring this money is that--I am
speaking for myself, but I am very optimistic that under the leadership
of Senators Lott and Daschle, the Senate will come together in its
concept for funding for the visitor center and its concept of how we
can make some adjustments to the previous plan, and tomorrow in markup
report out a bill which can then be considered by the full Senate and
then eventually by the House.
But I would like to read a little background to show you the need for
moving ahead. Yes, the tragic events of the last few days--and we have
just completed what I regard as a magnificent --magnificent--tribute to
the two fallen Capitol policemen, together with their families, the
President of the United States, the Vice President of the United
States, Senator Lott, the Speaker, and Chief of Police Albrecht.
But we have been moving steadily on this program. Now we intend,
hopefully, to go and take the next step and put a legislative proposal
before the Senate; and then, hopefully, the House will act.
I will read from a CRS report, which I ask unanimous consent to have
printed in the Record, dated July 16, 1998.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Capitol Hill Security: Capabilities and Planning
(From the Congressional Research Service)
Summary
The U.S. Capitol is simultaneously a national shrine,
tourist attraction, and working office building. Each of
these functions imposes different security requirements. The
Capitol Police Board, established by Congress to protect the
Capitol complex, has responsibility to reconcile the needs of
safety and openness. Acting under the direction of House and
Senate oversight and appropriations committees, the board has
recently instituted numerous enhancements to the Capitol
security system. To further enhance security, Congress in
April appropriated $20 million for a perimeter security plan
encompassing Capitol Square, Senate office buildings, and
adjacent grounds. Implementation of the plan is contingent
upon approval by the appropriate congressional oversight
committees. Still under consideration are proposals calling
for a visitors' center beneath the east front plaza that
would provide more effective remote screening of Capitol
visitors, and a perimeter security plan for the Supreme
Court.
Introduction
Seven to 10 million tourists visit the Capitol complex
annually. In 1997, the Capitol hosted more than 2,000
American and foreign dignitaries, and was the site for nearly
300 scheduled demonstrations. In addition to lawmakers and
their staff, a sizable number of journalists, lobbyists, and
service personnel also work within the Capitol complex.
The challenge of achieving a secure environment for the
Capitol complex, while still maintaining an atmosphere of
openness, has become increasingly difficult in this century.
Both the potential threats to the Capitol and the number of
people using the area every day have grown dramatically.
Incidents such as the 1993 bombing of the World Trade Center
and the 1995 bombing of the Alfred P. Murrah Federal Building
in Oklahoma City, as well as international confrontations
like Desert Storm in 1991, have prompted increases in the
level of security afforded the Capitol complex.
current security procedures
Role of the U.S. Capitol Police
The U.S. Capitol Police force, under the direction of the
Capitol Police Board (which is composed of the Architect of
the Capitol and the Sergeants at Arms of the House and
Senate), is responsible for Capitol complex security. By law,
the Capitol Police are responsible for the procurement,
installation, and maintenance of security systems for the
Capitol, House and Senate office buildings, and adjacent
grounds, subject to the direction of the Committee on House
Oversight, Senate Committee on Rules and Administration, and
the House and Senate Committees on Appropriations. The
Architect of the Capitol must approve any alteration to
structural, mechanical, or architectural features of the
Capitol complex buildings that is required for a security
system. The House and Senate Appropriations Committees must
approve funding for these programs.
In FY 1997, Congress appropriated $75.4 million for the
Capitol Police Board, which included funding for the Capitol
Police, and $3.25 million for the design and installation of
new and expanded security systems. In addition, the Architect
of the Capitol received $250,000 for ``architectural and
engineering services related to the design and installation''
of those systems. For FY 1998, Congress appropriated $74
million for the Capitol Police Board, including funding for
1,255 Capitol Police positions.
Regular Security Procedures
The Capitol Police force is prepared to deal with a wide
array of challenges, including armed intruders, bomb threats,
and chemical and biological warfare. Metal detectors, X-ray
machines, other state-of-the-art security and surveillance
systems, and uniformed officers are located at the entrances
of all 19 buildings comprising the Capitol Hill complex.
Inside the Capitol, security cameras and motion detectors
monitor the movement of people. Uniformed and plain-clothes
officers are stationed in the House and Senate chambers, and
throughout the building. All trucks making deliveries to the
Capitol must first go to a central delivery site where the
contents are unloaded and subjected to X-ray, weapons, and K-
9 inspections before being delivered. K-9 units also perform
random sweeps for explosives in adjacent streets and parking
garages.
Specialized Units
The Capitol Police also have several specialized units to
deal with particular types of security threats. Each of these
units, except for the hazardous devices unit, works
with other units on other assignments, including street
patrols. The specialized units, which were created to
address organizational concerns and assure appropriate
responses to new kinds of perceived threats, include the:
first responder unit, the first to arrive when there is an
emergency; mountain bike unit, used for increased mobility
across the Capitol grounds when a situation requires quick
access to a site; containment and emergency response unit,
used for counter-terrorism, hostage rescues, dignitary
protection, and chemical/biological warfare situations;
hostage negotiations unit, with primary responsibility for
all hostage negotiations, frequently assisted by the
containment and emergency response unit; civil disturbance
unit, responsible for monitoring large demonstrations when
the potential for significant public disturbances exists;
and hazardous devices unit, acts as the bomb squad on
Capitol Hill, conducts off-site explosives security for
Members, maintains a K-9 explosives detection corps, and
is slated to take over chemical/biological warfare
response functions.
Enhanced Capabilities of the Capitol Police Force
In recent years, the Capitol Police force, with the
concurrence of Congress and the Capitol Police Board, has
enhanced its capabilities and professionalism by: increasing
the training opportunities available to members of the force;
creating a physical security division charged with the
development and implementation of an integrated security plan
for the entire Capitol complex; strengthening its ability to
deter, interdict, and respond to acts of violence through
partnership with other U.S. intelligence and security
agencies; and developing a chemical/biological incident
response capability. It has also created a working group to
refine, document, and implement an emergency evacuation plan
and critical-incident command operation.
perimeter security plan
Subsequent to the developments already described, the
Senate Committee on Rules and Administration early in 1997
directed the Capitol Police Board to develop a perimeter
security plan for the Capitol complex. For this purpose, the
board organized a task force that included key staff from the
offices of the Architect of the Capitol, the House and Senate
Sergeants at Arms, and the Capitol Police, as well as
nationally recognized architectural and security consultants.
``The challenge,'' the Architect emphasized at subsequent
hearings, was ``to sensitively integrate a sophisticated
security program into the historic landscape of the Capitol
grounds and the fabric of the incomparable complex of
buildings that grace Capitol Hill.''
On September 25, 1997, the Architect unveiled the results
of the effort, which the Capitol Police Board endorsed, at a
Senate Rules Committee oversight hearing. The plan called for
``improved security at all entrances to Capitol Square
through the use of a combination of high impact vehicle
barriers that are police activated at the most critical
locations, or card activated at parking related areas.'' The
primary elements of the plan were: (1) ``a continuous string
of security bollards similar to those designed for, and
installed at, the White House;'' (2) ``new
[[Page S9118]]
impact stone planters consistent with the Frederick Law
Olmsted walls;'' and (3) an ``integration of electronic and
other security systems at each entrance.'' The continuous
security perimeter would be located largely within Olmsted's
original walls, as designed by the acclaimed 19th century
landscape architect.
A month later, the Rules Committee approved this plan, and
also authorized the Architect to move forward immediately in
developing perimeter security for the area immediately
adjacent to the three Senate office buildings. On April 30,
1998, Congress approved $20 million for ``the design,
installation and maintenance of the Capitol Square perimeter
security plan'' as part of a FY 1998 supplemental
appropriations bill, which was signed into law the following
day. These funds include $4 million ``for physical security
measures associated with'' the plan. Use of the remaining $16
million was discussed in documents provided to the Senate
Rules Committee at the September 1997 hearings.
The Senate version, as initially reported, provided that
funds for perimeter security of Senate office buildings be
subject to review and approval by the Senate Appropriations
and Rules and Administration Committees. Funds provided for
perimeter security of the Capitol Square were subject to
review and approval by the House and Senate Appropriations
Committees, the Committee on House Oversight, the Speaker
of the House, and Senate Rules Committee.
other current security proposals
Proposed Capitol Visitors' Center
Still pending before Congress is a proposal to construct a
visitors' center beneath the east front plaza of the Capitol.
This proposal has implications for security enhancement
because the center would serve as the primary entrance and
exit for visitors, allowing the Capitol Police to screen them
more effectively. At the same time the center would create
space for several auditoriums, a cafeteria, educational
exhibit facilities, restrooms, and a first-aid station.
Planning for the visitors' center has been underway since
1991, when the Architect of the Capitol received approval to
use previously appropriated security enhancement funds for
the center's conceptual planning and design.
The design was completed in June 1991, and reviewed by the
House and Senate Appropriations Committees and the Senate
Committee on Rules and Administration. In December 1993, the
Capitol Preservation Commission allocated $2.5 million to
translate the concept into a formal design. The Architect
entered into a contract with RTKL Associates Inc. to develop
a design for the visitors' center, and in 1995, the Architect
published a report reflecting RTKL's work.
H.R. 20 and S. 1508, introduced in 1997, ``authorize the
Architect of the Capitol, under the direction of the Capitol
Preservation Commission, to plan, construct, equip,
administer, and maintain a Capitol Visitor Center,'' and
``reconstruct the East Plaza . . . to enhance its
attractiveness, safety, and security.'' S. 1508 would
delegate responsibility for the design, installation, and
maintenance of the center's security systems to the Capitol
Police Board, which would be required to conduct a study
assessing ``security cost savings and other benefits
resulting from the construction and operation'' of the
center.
S. 1508 identifies a primary purpose of the center as the
enhancement of Capitol security. When it was introduced,
Senator John Warner, chairman of the Committee on Rules and
Administration, emphasized that the ``most compelling need
for the Capitol Visitor Center is to add a major element of
enhanced security for the entire Capitol building and
environs.'' During May 1997 hearings on H.R. 20, members of
the Police Board stressed that a visitors' center would
enable the Capitol Police to regulate the number of people
inside the building at a given time, allow them to be better
prepared for an orderly evacuation in the event of an
emergency, and strengthen the security of the Capitol while
preserving free public access.
Both bills call for the establishment of a separate account
in the Treasury to handle funds for the project. S. 1508
directs the Capitol Preservation Commission to ``develop a
detailed plan for financing the project at the lowest net
cost to the Government.'' H.R. 20 directs the Architect of
the Capitol to develop and submit a plan to the commission
``that would enable construction of the project to be
completed without the appropriation of funds to the
Legislative Branch.'' The estimated cost of the proposed
visitors' center is $125 million. Of this amount, the
Commission has already raised $23 million.
Proposed Supreme Court Perimeter Security
A related proposal calls for the development of a perimeter
security plan for the Supreme Court building and adjacent
grounds. In FY 1997, Congress appropriated $150,000 for a
preliminary study under the director of the Architect of the
Capitol, which was completed by private consultants. In June
1998, Chief Justice William H. Rehnquist approved the
schematic plan presented by the Architect and security
consultants. The Court's FY 1999 budget request includes an
additional $500,000 for ``detailed design development and
preparation of construction drawings'' for this project that
are ``consistent with design schemes being implemented
through the Capitol complex perimeter security.'' It is
estimated that a Supreme Court perimeter security plan would
cost approximately $5.1 million.
Mr. WARNER. From that report:
Seven to 10 million tourists visit the Capitol complex
annually. In 1997, the Capitol hosted more than 2,000
American and foreign dignitaries, and was the site for nearly
300 scheduled demonstrations. In addition to lawmakers and
their staff, a sizable number of journalists, lobbyists, and
service personnel also work within the Capitol complex.
The challenge of achieving a secure environment for the
Capitol complex, while still maintaining an atmosphere of
openness, has become increasingly difficult in this century.
Both the potential threats to the Capitol and the number of
people using the area every day have grown dramatically.
Incidents such as the 1993 bombing of the World Trade Center
and the 1995 bombing of the Alfred P. Murrah Federal building
in Oklahoma City, as well as international confrontations
like Desert Storm in 1991, have prompted increases in the
level of security afforded the Capitol complex.
This report talks about the legislative proposals. I refer to one of
the last paragraphs.
S. 1508 [a bill that I drafted and put in with the
distinguished majority and minority leaders several months
ago] identifies the primary purpose of the center as the
enhancement of Capitol security. When it was introduced,
Senator John Warner, chairman of the Committee on Rules
Administration, emphasized that the ``most compelling need
for the Capitol Visitors Center is to add a major element of
enhanced security for the entire Capitol building and
environs.''
``During May of 1997 hearings on H.R. 20, members of the
Police Board stressed that a visitors' center would enable
the Capitol Police to regulate the number of people inside
the Capitol at a given time, allow them to be better prepared
for orderly evacuation in the event of an emergency, and
strengthen the security of the Capitol while preserving free
public access.''
We want to, in every way, maintain this, the people's building, and
to provide for the greatest degree of access that we can possibly
achieve, given the need for increased security measures. It is my
fervent hope that in the years to come, not only 7 to 10 million, but
even more Americans and visitors from abroad can come and see this
structure and the symbol of freedom for which it stands.
Mr. President, I am having a portion of the report that was
associated with the United States Capitol Square Perimeter Security
Report be reworked by the Architect's office so it can be printed in
the Record. I also hope before the day's conclusion to introduce a
draft of a bill which would be taken up in markup tomorrow, but I am
awaiting instructions from the majority and minority leader and,
indeed, the Speaker's input, which I hope to get today.
I thank the Chair. I thank the manager of the bill. I yield the
floor.
Mr. CAMPBELL. It is my understanding that the Warner amendment of
technical changes is supported by both sides of the aisle. I urge its
passage.
Mr. WARNER. May I ask the manager, have we had a chance to compare
the two drafts, and is the draft at the desk to be amended at all?
It is the same? So the draft at the desk, then, is the same. I join
with the manager in moving the bill.
The PRESIDING OFFICER. The question is on agreeing to the amendment.
The amendment (No. 3356) was agreed to.
Mr. CAMPBELL. I move to reconsider the vote.
Mr. WARNER. I move to lay it on the table.
Mr. President, I wish to thank the distinguished Senator from
Colorado and his distinguished partner, the other manager of the bill,
for their cooperation in expediting this manner.
Mr. CAMPBELL. I now ask unanimous consent to return to the Hutchinson
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Kansas.
Tax Code Sunset Amendment
Mr. BROWNBACK. Mr. President, I rise to make a few remarks regarding
the Hutchinson amendment that is to be offered shortly regarding the
Tax Code sunset bill or Tax Code Elimination Act that he has been
working on. I have been working with him, along with a number of our
other colleagues in the Senate, in considering this particular piece of
legislation.
I congratulate the Senator from Arkansas on his work on pushing
forward a sunsetting of the Tax Code and a sunsetting of the burden it
places on the American families--not so much of
[[Page S9119]]
the rates, even though I think those are too high; not so much as the
level of taxation, which I think are too high as well; but the burden
simply of such an oppressive, intrusive Tax Code.
I want to share a little bit with my Members here in the Senate about
the nature of this Tax Code and some of the things that are happening
within this Tax Code. I have a chart here that I think says quite a bit
about where our Tax Code has evolved to. Look at the basic foundation.
The Declaration of Independence, 1,300 words; the Bible, 773,000 words;
the United States Tax Code, 2.8 million words and growing. And growing.
That is just too much, too much of a burden.
I also want to share with my colleagues, this debate has been going
on for a little bit of time, so we contacted the IRS and said could we
have all of the forms that you send to the average American in asking
them to fill out their taxes. We just want to see the forms that the
average American gets, and we would like to have all of them.
It was interesting that the first thing they responded from the IRS
headquarters is we don't have all of the forms. They said they couldn't
get those, so they did send us about two-thirds of them. I would like
to show Members, these are just the forms. This is not the law. These
represent the regulations that explain what is taking place with the
IRS code. These are just the forms that they send and the instructions
that go with those forms. There are a lot of other documents that go
along with these, as well. I hope I can get these stacked on the desk
and the desk will hold it.
The burden on the back of this desk is the burden on the back of the
public. This is not even all the forms. It represents two-thirds of the
forms shipped out by the IRS to the average taxpayer, to businesses,
saying these are the sort of things you have to fill out. Not only do
you have to fill them out, you have to fill them out correctly. If you
don't get them correct, you are subject to fines, penalties, possible
imprisonment, from this horrendously complex Tax Code that many
people--even with some advising from the Government--don't get the
answer right.
If that doesn't define a burden, I don't know what does. What is even
worse is that the Federal Government is not content merely in
collecting taxes or making complex taxes. It wants to control behavior,
as well. Some of those things it would put in the Tax Code are not even
very good, either.
I want to give a great example of micromanagement by the Federal
Government of people's daily lives in a negative fashion; that is, the
marriage tax penalty. Most people are familiar with the marriage tax
penalty, and that is a tax on people to be married, two-wage-earner
families, to be married. They will pay more in taxes than two single
people. Two single people who choose to live together would pay less in
taxes than a married couple.
Now I think most people would say in this time of difficulty for
families that that is a bad signal to send. We are going to tax
marriage as a disincentive to marriage in the system. People say we
didn't put it there as a disincentive. Well, it is a disincentive to
marriage and it is built into the Tax Code and it is substantial. It is
also preposterous.
Our society is built on the foundation of solid families. Creating
disincentives to solid families is the wrong signal for us to send at
this point in time in our Republic. It is the wrong signal to send at
any time. Because of the marriage penalty and other inconsistencies in
our Tax Code, I am convinced that this is a Tax Code that history will
report as one of the most onerous burdens ever faced by the American
public. Our amendment aims to make this code history and to require
Congress and the President to put in place a new code, a fair and a
simpler tax code, that has far less micromanagement from the Federal
Government, and is far more oriented towards growth and toward the
family.
Mr. President, I want another American century. I want it for my
children. I want it for my children's children. And I want it for all
Americans. I am convinced that with this type of a system, with this
type of micromanagement out of Washington, we cannot have another
American century. This code must be scrapped. We put plenty of time in
place to come up with a new, better, simpler tax code that is more
liberating to the families, that is more supportive to business, and is
far more intelligible by the public.
As a matter of fact, I simply ask my colleagues that don't support
this type of amendment, could we do any worse than the current Tax
Code? Could we truly be any more complicated than the current taxation
system? Could we be any more onerous and unintelligible than the
current tax system if we sunset this and go to another? I ask that
question as I travel around the State of Kansas, and I don't get many
people that say it could get any worse. It has grown over the years and
we have added and added and amended and amended. Americans are
demanding tax reform and we have promised tax reform. It is now time to
deliver on that promise to the American people. Some will argue that we
have to be careful about any radical changes to our tax laws, and I
agree. I believe that we must carefully weigh alternative plans, debate
the macro and micro effects of each, and then arrive at a thoughtful
and reasoned solution that is equitable and just. That is why we are
putting this off 4\1/2\ years until we actually go to and require a new
Tax Code. We are saying 4\1/2\ years of debate, but let's finally start
the debate. We haven't even gotten started on it. We are saying let's
start the debate, and let's set a time certain that we will have a new
Tax Code that is fairer and simpler, and let's have a great national
debate about it. The way we are going right now is, we are saying yes,
it is a bad Tax Code, but we are not willing to do anything about it.
This amendment would simply say we are going to do something about
this over the next 4\1/2\ years. We are going to pass a new Tax Code.
We are sunsetting this one at a date certain, and let the great
national debate begin. I think that is a just and equitable way to go,
and it is not a radical way to go.
The bottom line is that the Tax Code we now have in place punishes
good investment decisions and distorts the labor market, as well as our
rates of national savings. It hurts the family and manipulates behavior
by adding incentive to do one thing while punishing another, which
frequently goes in the wrong direction.
Here is another quick example of an inadequacy in our Tax Code that
is a harmful public signal. I don't know if you recall this; some
people will. I mentioned this previously on the floor. If you are a
chronic gambler, you can deduct your gambling losses. If you are a
homeowner who made an unlikely investment and the value of your home
declined, you have no recourse in the Tax Code because you cannot claim
a deduction for capital loss. The question is, Why can somebody deduct
a loss associated with a bad game of blackjack but not a loss
associated with their primary residence in which they were the
unfortunate victim rather than the willing participant? The code is
full of inconsistencies like the one I mentioned--perhaps unintended--
that people got into over a period of time.
I would like to think that what we could do now is start a reasoned
and great debate about a simpler, fairer, better system that is far
less about micromanagement and raising revenue for the Federal
Government, and not about sending bad signals to the public. Some may
disagree about how we would go about going to a different Tax Code, but
this is precisely the issue upon which we must focus our debate. We
must decide where we want the tax to be imposed, and we must understand
the imposition of the tax on the health of the economy. However this
debate takes shape, we must have as our goal a tax system that doesn't
distort behavior and create deadweight loss. We must have as our goal a
pro-growth, pro-family tax system. We should have as our model some
kind of simpler and fairer and far more understandable code.
As I travel across Kansas, I ask a lot of people about whether or not
they regularly, or even within the last month, have made a personal or
business decision based upon the Tax Code. Virtually two-thirds say
that, ``Over the last month, I have made a business or a family
decision based upon tax policy.'' That is not what we want to create.
It is a system where everybody has to consult with the Tax Code before
they make a business decision, where everybody has to consult the Tax
Code before they make a family
[[Page S9120]]
decision. Yet, that is the system that evolved to where we are today,
to where it is micromanagement out of Washington.
I ask the public in Kansas, ``Imagine if you had a system that,
regardless of the business decision you made or the family decision you
made, the tax results were the same. Would you like such a system?''
They say, ``Absolutely.'' Furthermore, they would have more economic
growth, as they would put the money into a better economic decision
taking place here, and they would not be penalized as a family member
doing things that are the best for their families.
Let's begin the great national debate. Let's sunset this Tax Code and
move to something new. Our bill will enable the debate to take place
outside of the realm of some of the demagoguery because it does protect
the important funding mechanisms for Social Security and Medicare. We
set aside those chapters in the IRS Code; we don't touch those. I
believe we have a commitment to ensure that we have a full, honest, and
open debate. Our bill will give that opportunity to this Senate.
Finally, Mr. President, as we look forward to the new millennium and,
hopefully, another American century, we will provide the American
people with a renewed sense of the American dream, a renewed sense of
what it means to be an American and what it means to live in America.
We can't achieve that with this taxation system. It is time to sunset
it, start the debate, and get to a better one.
Mr. President, I yield the floor.
Mr. ROTH addressed the Chair.
The PRESIDING OFFICER. The Senator from Delaware is recognized.
Mr. ROTH. Mr. President, throughout my career, I have been a strong
proponent of tax reform. I have made no bones about the fact that the
tax burden borne by Americans is onerous and counter-productive to real
economic growth, jobs, and opportunity. I have made it clear that we
stand in need of tax reform--a tax code that is simple and fair,
placing the needs and growth of our families and communities before the
needs and growth of the Federal bureaucracy.
I am encouraged by the developing consensus for serious tax reform.
As chairman of the Finance Committee, this is among my highest
priorities. And I look forward to working closely with my colleagues
toward building a promising new tax system that will open a world of
possibilities as America moves into the 21st century.
At this time, however, I caution my colleagues to not let the
momentum we are gathering overtake our constructive endeavors.
To sunset the current tax code without first structuring a better
system would be something like quitting your job before first
establishing where your new place of employment is going to be. While
such a move may be satisfying and even exciting, when you have a
mortgage, some personal debt, and a family depending on your income it
is not only imprudent, but could result in devastating consequences.
Prudence, control, and careful planning--that's what our tax reform
efforts require from us. Sunsetting the tax code without an alternative
in place would create pandemonium in the marketplace.
What would it do to our credit rating? To our ability to meet current
responsibilities? How would it be perceived internationally, among our
economic partners, and in the global banking community? And how would
it affect our families and business community? How do they plan? Where
do Americans put their money for retirement, for pensions, for
investment, for housing? What will happen to the home mortgage
deduction? And how will that influence the real estate and homebuilding
markets?
Today the Dow Jones industrial average is down because of recent
corporate earning reports and developments in the investigation into
the President. Can you imagine what will happen when news hits that the
tax code is going to be sunset without a consensus or even a blueprint
for a replacement?
If Congress votes to sunset the tax code and does not enact a
replacement by December 31, 2002, what happens? We need a tax system--
despite how much I would prefer it to be otherwise.
If there is no replacement by December 31, 2002--if Congress has not
yet reached a consensus, if the decision--the best Congress can do--is
to extend the tax code we have voted to sunset then that extension
would, in effect, become the single largest tax increase in history!
I do no want to be party to that. I don't think any of my colleagues
do.
To tear down the tax code before Americans know what will replace it
is dangerous. We must work to change the current system. Toward this
end, I pledge my every effort.
We must eliminate the current code's complexity. We must bring relief
to those who are bearing a back-breaking load. We don't need to fiddle
at the edges of the current code. We can change the code altogether. We
can create an innovative and promising code for a new century. But we
must do it in an organized and orderly way. To vote for this amendment
is to pass the buck to future Congresses. We can go home and declare
victory for taking a strong stand for tax reform, but then the issue
will still have to be addressed, a consensus will still have to be
developed, Americans will still need to be included in such an
important effort.
I am sympathetic to this amendment. Emotionally, it appeals to me.
But it is not right. It is not right analytically. It is not good
public policy. And it, in fact, is not right Constitutionally. Only the
House can originate a revenue measure. This vote would constitute a
revenue measure, and--as such--would be subject to a blue slip. For
these reasons, I encourage my colleagues to vote against this amendment
and join me, and the many others who realize the importance of real tax
reform, in working for a successful new code.
Mr. President, I yield the floor.
Mr. GRAMS addressed the Chair.
The PRESIDING OFFICER (Mr. Smith of Oregon). The Senator from
Minnesota.
Mr. GRAMS. Thank you very much.
Mr. President, I rise to strongly support Senator Hutchinson's
amendment to terminate the tax code. I commend his leadership and his
persistence in advocating what is real tax reform.
Mr. President, more than 200 years ago, our ancestors staged a tea
party and revolted against their mother country to protest the
imposition of unfair taxes. Today, taxes imposed by our own government
are unfair by any standard. Had our ancestors faced a tax system as
punitive as ours has become, they might very well have jumped into the
harbor along with the tea.
Americans today are working harder but taking home less of their pay.
Why? In excess of $1.7 trillion of their income is siphoned off to
Uncle Sam each year. In 1997, total taxes--federal, state, and local--
claiming a record 38.2 percent of a typical family's income.
Nearly 40 percent of everything the average family made went to
support government.
Nearly 4 hours of every 8-hour working day are dedicated just to
paying taxes. The total tax burden borne by the American taxpayer in
1998 is the highest in U.S. history.
We are being taxed at a higher level today than at any time in
history, including World War II and other conflicts.
The tax code must be terminated because the earnings, spending, and
savings of the American people are taxed over and over to squeeze more
money out of their pockets to line the pockets of government. Income is
taxed when it's first earned. The after-tax income is then subject to
certain excise taxes when spent.
If this after-tax income is saved in a savings account or invested in
a business, the interest and profits will be taxed again. If the
corporation pays out its after-tax earnings as a dividend to the saver,
or if the saver sells his investment, the savings is taxed a third time
through a capital gains tax.
If the saver dies with some accumulated savings, these savings will
be taxed a fourth time through estate and gift taxes. Even after death,
one's tax liability lives on.
The tax code must be terminated because it has long been used as a
tool for social engineering and income redistribution rather than sound
economic policy.
Clearly, a system of graduated marginal rates violates the principle
of fairness. In addition, special interest groups are often unfairly
rewarded by politicians with special tax privileges.
[[Page S9121]]
We need to have a date certain when this Tax Code is going to end and
that we can begin with something new. No matter what we have done
recently to try to improve the IRS and the Tax Code, it is like putting
lipstick on a pig. We can't make it pretty. We have to pull this code
out by the roots, and we have to change it and replace it with
something that is friendly and that is fair and taxpayer friendly.
We need something like this legislation to act as a stick of dynamite
under the chairs of Congress to make them act, rather than
procrastinating and saying, ``We will do it next year, or maybe the
year after, or the year after.'' The American taxpayers aren't going to
wait that long.
The Tax Code must be terminated because it has become simply
complicated. It is difficult for anyone to understand, as Senator
Brownback showed us with this huge stack of just the forms that we are
having every year. The Tax Code has grown, as he showed us, from 14
pages when it was first enacted to more than 10,000 pages of Tax Code
today, plus another 20 volumes of tax regulations, and then thousands
of pages and instructions that go along with it. Even the IRS and tax
professionals repeatedly make mistakes. IRS agents reportedly gave
wrong answers to taxpayers at least half of the time. And the question
is, How can anyone master all of the code? I don't blame the IRS or any
of the good workers at the IRS. But it is Congress that has developed a
Tax Code that is so complicated that even the experts in the field of
the IRS can't guarantee that they are going to give the average
taxpayer an answer that is right when they call and ask.
So, again, the tax code must be terminated because it's too expensive
for the American people. The IRS employs over 102,000 agents to collect
taxes, more agents than the FBI and the CIA combined. The taxpayers
must pay more than $8 billion each year to operate the IRS.
Worse still, American families, small business owners, and
corporations will spend at least another $225 billion just trying to
comply with the Tax Code, money that could be better spent elsewhere.
If they fail to comply due to innocent mistakes, the IRS penalties
could actually ruin some lives.
The tax code must be terminated because the IRS has evolved into an
arrogant, inefficient, intrusive, and abusive bureaucracy. IRS agents
routinely use their enormous, coercive power to squeeze more money out
of the taxpayers' pockets to meet the demands of ever-increasing
government spending.
Rooted deeply within the system rests the core flaw of the tax
system: policymakers care little about spending other people's money
because the money isn't their own. Now is the time to reverse that
thinking.
If you are going out tonight for supper and spend your own money, you
might spend $50. But if you are going to go out for supper and you take
my credit card, you might spend $500 on a night out. In Washington,
much of that is what is happening.
With millions of our citizens demanding real tax reform, Congress
must grasp this historic opportunity to deliver change--change that
will forever repair the system, honor our great American heritage of
individual choice and responsibility, and reflect true American values.
In sum, Mr. President, the current tax code is an unmerciful mess--
but it doesn't need to be. We can and must replace it with a new system
that is simpler, fairer, flatter, and friendlier--a better system that
will lead this great country into the 21st century.
We will not have a better incentive to reform than an actual date to
terminate the code. I urge my colleagues to support Senator
Hutchinson's in this very, very important amendment.
Thank you, very much. I yield the floor.
Mr. LOTT addressed the Chair.
The PRESIDING OFFICER. The majority leader.
Mr. LOTT. Mr. President, I do want to say to the managers that I
don't think we should have a lengthy debate this afternoon on this
subject. It is one that I could see us spending hours or days on,
because there is plenty to talk about. But we need to continue to make
an effort to move our appropriations bills.
I know the distinguished chairman of the Subcommittee on Treasury and
Postal Service, the Senator from Colorado, would like to do that. He
and the ranking member from Wisconsin are working hard. But I want to
give a few remarks briefly in support of this amendment. I have stayed
away from doing that on amendments on appropriations bills because I
have been discouraging amendments all along the line. But this is one I
feel strongly about.
It is also very hard for me to rise in support of an amendment of
this nature when the chairman of the Finance Committee is expressing
his reservations. But it is totally understandable. He wants to make
sure that when we do it, we do it right, and that we develop another
tax system that we have thought about. He is doing what you would
expect a cautious chairman to do. He takes a back seat to none of us
when it comes to finding ways to make the Tax Code fairer and giving
tax relief to the American people.
Having said that, I think we ought to do it. There is plenty of time
here to think about what the alternative is going to be. Four and a
half years--how long does it take? I will tell you how long it will
take--forever, unless we make up our minds on behalf of the American
people. With their support, we are going to make this happen. We are
going to do it.
Others have pointed out what we are talking about. Here it is, Mr.
President. This is the Internal Revenue Code.
The copy I have here is about 7,000 pages long in very small type.
Frankly, that is absurd. This Tax Code contains the accumulation of 85
years of special interest provisions--your special interest, my special
interest, somebody else's special interest, but it has become a
hodgepodge. It is not understandable. It makes no sense. It is not
simple. It is not fair. It is hopeless. We ought to start over and try
to get it right and make it fairer and simpler.
It has become, quite frankly, a three-headed monster, and we have to
cut off all three heads. We are working on two of those. One, you cut
off the head of unfairness and try to provide some of the tax relief
that really is needed by allowing families with children to keep more
of their money, as we did last year; by moving to eliminate the death
tax, as we started on last year; by hopefully getting started seriously
phasing out as soon as possible the marriage penalty tax this year. We
are doing some things that make it fairer and even a little simpler,
and we will continue to do that. We should do some more of it this year
and some more the next year. We should do some of it every year.
The second head is intimidation--the culture, the problems at IRS
that we saw that have developed over the years since the last time we
reformed the IRS Code way back in 1952. Well, this year we got it done.
It took us almost a year, but we did get fundamental reform and
restructuring done. That was the second head that we were able to chop
off and deal with.
But the third one is to terminate this Tax Code, do it in a
responsible way. It won't terminate until December 31, 2002. Plenty of
time to decide.
When I go to my own State and I ask people: What do you think about
the Tax Code? They react negatively. And I say: How many of you think
we should eliminate it? Every hand, every hand goes up. Then you start
saying, OK, what are we going to replace it with? We have got time to
go to the people in Wisconsin and Colorado and ask their opinion.
Let's think this thing through. Let's do it right. But let's make it
clear, let's make it undeniably clear we are going to do it. This is
the way to do it.
Some people say, well, gee, unless you have a plan in place, you
shouldn't do this. Well, in Michigan, the great State of Michigan, a
big State, they eliminated the property tax without a replacement
because they knew that the deadline would force their legislature to
act on a replacement. And they did. Wisconsin--Wisconsin--created a
deadline for abolishing its welfare system, and it drove the reforms
that have worked in that State probably better than any other State, at
least from what I understand.
This will guarantee that we get it done. I think we should pass the
termination date, and I think we should make ourselves live by that
date. We should move toward making decisions,
[[Page S9122]]
and we should fundamentally reform our Tax Code. It is overdue. It is
the third head of this monster that must be removed so that the
American people can be free, free of the oppression that we have
developed over these 85 years in this Tax Code.
I yield the floor, Mr. President.
Mr. SESSIONS addressed the Chair.
The PRESIDING OFFICER. The Senator from Alabama.
Mr. SESSIONS. I rise in support of this proposal by Senators
Hutchinson and Brownback, the proposal so eloquently supported by the
majority leader, Trent Lott. He is exactly right, in my opinion.
I was at that first press conference when this proposal was
announced. I believed in it then and I believe in it now. The Internal
Revenue Code with 7,500 pages and over 800,000 words, has grown each
year and continues to grow. We cannot ask the American people to read
thousands of pages before they pay their taxes. We cannot ask them to
pay hundreds and hundreds of dollars to have accountants do their tax
returns, returns they used to be able to do themselves. It is simply
not fair, and it is not right.
As I recall what a good tax is supposed to be, if there is a good
tax, according to the textbooks, it is a tax that is understandable. It
is a tax that is predictable in terms of revenue. I would say that is
one thing our Tax Code does, it produces a very large but predictable
supply of revenue. But a ``good'' tax is also supposed to be easy to
collect and is supposed to be perceived as fair. I would say it is only
in the predictability of revenue that our Tax Code acceptable.
Otherwise, it is really on unacceptable terms that revenue is raised to
fund this great Government.
A few months ago, last fall, Dick Armey and Billy Tauzin from the
House of Representatives came to my hometown of Mobile, AL, to have a
debate about the Tax Code. Mr. Armey is in favor of a flat tax, and Mr.
Tauzin, a consumption tax. The place was packed, standing room only.
They announced it on the television and on Sunday night people came out
from all over. They were fascinated and asked questions. They were
energized by this debate. I am told that everywhere Mr. Armey and Mr.
Tauzin go people are there in record numbers; they are interested in
this issue, and they care about it.
For days after the debate in Mobile, people came up to me, and this
is the question they asked: Jeff, can we really do it? Is this
something we can do? And my answer to them was: Absolutely, we can do
it. There is no reason under this Sun that we cannot pass a simplified
Tax Code. We must be able to say to the American people, the people who
elected us, that we can produce a Tax Code that is simple, fair, easy
to understand, and produces a steady revenue. And whether it is a flat
tax or a consumption tax or some combination of both, we need to focus
on this issue in Congress.
By passing a deadline, with 4 years to go, we will set a date that
will force us to confront this issue and respond to the wishes of the
American people. Having run for office just recently, in 1996, I know
the American people are confident the Government is going to have money
to run itself. I also know they want tax reductions. With the recent
surpluses, they want more than they wanted just a few years ago. But
what they really want is a Tax Code that is simple and fair, and we can
give that to them. We need to make a commitment to that end. And if we
do so, I believe that people in this country will appreciate it very
much.
I favor this proposal. The American people are fed up. It will help
make this country competitive because we will not have wasted all this
time and effort collecting taxes. Instead, we will spend it developing
new and improved products in our businesses and industries in America
so that they can continue to be competitive in the world.
I appreciate this opportunity to speak. I salute Senators Hutchinson
and Brownback and all others who support this amendment, and I look
forward to being a part of the reality of eliminating the Internal
Revenue Code as we know it today.
Mr. KOHL addressed the Chair.
The PRESIDING OFFICER. The Senator from Wisconsin.
Mr. KOHL. Mr. President, I would like to speak in opposition to the
Brownback amendment.
Sunsetting the Tax Code may sound catchy and attractive, but in truth
it is simply wishful thinking until we have some concrete idea about
its replacement.
Now, we all agree that the current code is too complex and too
burdensome for the average taxpayer, and everyone agrees that we need a
simpler and a fairer system. But we also know that some sort of tax
structure is necessary to maintain the vital functions of our
Government. The current Tax Code, however imperfect, allows us to
sustain our national defense, provide aid to struggling farmers, make
sure that those Social Security checks are delivered on time, and much,
much more. Down the road, we may envision and hope for a more direct
route to providing those resources than the current tax system, but
until we find that alternate route, this debate should remain just
that, a debate, an open dialog as to what system would best serve the
American people. In addition, simply sunsetting the code would be a
disaster for American business. We hear so much about the need for
American corporations to make long-range business plans, and indeed
that is true, they must. But how will that be possible if they don't
know what Tax Code they will face after the current one sunsets? How
many resources would companies waste trying to plan for all the
possible new tax codes that we might enact 4 years from now?
Finally, sunsetting the Tax Code without any notion of how we might
pay for it makes a mockery of the progress we have made in balancing
the Federal books. We are all encouraged by the budget surplus and the
strong economic forecasts, but we should not get ahead of ourselves and
think that the good news warrants a swift departure from the tough
decisions and fiscal discipline that brought us to this point.
So for these reasons I will support, when it is raised, a Budget Act
point of order against the Brownback amendment. I urge my colleagues to
do the same.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. LAUTENBERG. Mr. President, I rise in opposition to this
amendment, which eliminates the Tax Code without an alternative.
Mr. President, I heard it said that we ought to ``pull it out by its
roots,'' get rid of it now. Well, I would hate to go to a dentist with
a toothache and have the dentist say, ``You know what, we are going to
look at this tooth. First, we will pull it out by its roots, and then
we will look at it.''
That is what is being proposed here, Mr. President. This amendment
would get rid of the Tax Code, but without any indication of what would
replace it. Instead, we could be left without any revenues to operate
the government. We could be left with no revenue to support our
military and protect our country. With no revenue to buy the weapons
systems we need for the future to advance our country technologically.
Mr. President, this amendment will create tremendous uncertainty in
the business community. They're not going to know when they can make
investments and when they cannot. For example, they will not know
whether the R&D tax credit will be available. That is an important part
of the code. But businesses will not know whether it will remain
available if this amendment is enacted.
Mr. President, I ran a big company that now employs 31,000 people. I
started this company with two other guys, poor people from New Jersey.
We built the company by planning ahead and making investments, often
because we knew that there were tax benefits that we could count on.
But if this amendment is approved, other entrepreneurs will not be able
to make similar plans.
What the distinguished Senator from Kansas is saying is, ``Wait,
before you do any investing, let's get rid of the Tax Code. Wander
where you want through the jungle for a couple of years, and that will
make the Congress respond.''
I don't understand it, I must tell you. Sometimes I think I work in a
different place from some of my colleagues, because the references are
to ``them.''
``They will never get it done unless we pull it out by its roots.''
``They will never get it done unless we make the pain excruciating.''
[[Page S9123]]
``Fear of shutting down Government, fear of being unable to operate,
that will make them move.''
Who is the ``them'' and who is the ``they''? Who is the ``we'' and
who is the ``us''? We are all in this together for the American people.
Look at the economy. I hear about this oppressive Tax Code and the
number of pages, and ``Compare it to the Holy Bible.''
``Holy cow,'' that is what I say, ``holy cow.'' What are we going to
do? Are we going to weigh these things? Do we want to buy a scale here
and say if it weighs less than a certain number of grams, pounds,
ounces, it is OK? But if it weighs over that, overboard?
Go to the business community and ask them what they think about
throwing it all away. They will tell you that we would only be
punishing ourselves.
Mr. President, I agree that the Tax Code is too complicated and too
cumbersome. But the way to solve that is to offer something positive.
It is to offer a real alternative.
I also would point out, Mr. President, that eliminating the whole tax
code could undermine much of the progress we have made in recent years.
We have gone from a deficit of $290 billion six years ago, to a surplus
that is now projected to be $60 billion. And for the next decade, we
will have $1.5 trillion to pay down our debt.
But this amendment would reverse this progress. It says that we want
to play political games. That is what this is about. This is almost
becoming a national sport here. It is not football, baseball or
basketball, it is politics.
We are going to take away the revenue code. Do you know what? You are
not going to feel it, Mr. Citizen. Everything is going to be hunky-
dory. And do not worry if the FDA can no longer approve new drugs. And
do not worry if the National Cancer Institute can no longer do the
research needed to help defeat breast cancer or prostate cancer or to
help the newborn grow up healthy--no. No. We are going to fix the
revenue code. But you are not going to have to pay any price. You know,
Mr. and Mrs. America, you know there are free lunches all over this
place. You don't have to pay for anything.
Listen, no one here likes taxing people who work hard for their
money. The President certainly doesn't. He says: Provide tax relief for
families who send their children to child care so that they can go out
and work. Provide relief to support education, so that we can have the
best educated society on this Earth. That is where we want to give tax
relief--to ensure that our children can get a good education.
That is especially important in our age of technology in the new
millennium.
Mr. President, I come out of the technology business. I am,
immodestly, called, ``a member of the Hall of Fame of Information
Processing.'' My company was one of the earliest in the computer
business, and we learned that technology is the way to the future. We
helped start an industry called the computing industry. It is different
than the computer industry. The computer industry is the hardware. The
computing industry is all else. It is programs. It is engineering. It
is all those things. It is an industry that is dramatically improving
efficiency in so many ways.
Mr. President, from my experience in the business community, I know
the problems that would be created if we simply rushed out and
eliminated the entire tax code without a replacement. It would be a
serious mistake.
Yes, the Tax Code ought to be simpler. Yes, people ought to pay less.
But you don't get something for nothing in life. You don't get it in a
country club, you don't get it in a schoolroom, and you don't get it in
the United States of America.
We have seen what happens with those countries where they have codes
that say you don't have to pay--communism. You don't have to pay. They
produced a society in Russia that is almost flat broke, dispirited,
broken down, can't produce a product. We say let the free market
operate, and let the Tax Code reflect what the objectives are; to build
a society, to invest in this society, to give people a chance to get an
education, to know that when they are 65 years old that Social Security
is going to be there and its purchasing power is protected.
What a remarkable thing we are witnessing today, and how in a few
words here we like to disparage it. ``It don't work. It ain't good. Get
rid of it.''
Here we produced surpluses when deficits were the rule. And we want,
now, led by the President of the United States, to shore up Social
Security so somewhere in the 2070s--it is pretty obvious I won't be
running by then; I might, though--we want to make sure Social Security
is there for our children, for our grandchildren.
That is what we are doing now, and it is all part of a fiscal plan.
You can't throw out the revenues without throwing out the expenses. I
am sure the Senator from Kansas would say, ``Of course.''
Well, what expenses? The expenses for the military, the expenses for
research, the expenses for development, the expenses for education, the
expenses for clean air, the expenses for operating our national parks,
the expenses for leaving a legacy for our children, that tell them
there are still fish in the oceans, fish in the streams, so that they
have something to look forward to.
No; the mission is destroy first and then decide what you are going
to do next. I spent 3 years in the Army, and I never had that. We
always knew what the mission was before we started out on it.
Mr. President, I am a member of the Budget Committee. I am the senior
Democrat on the Budget Committee, and I expect that a point of order
will be raised against this amendment because it violates the budget
rules. I hope that our colleagues respond appropriately.
I respect those who differ with me, but I will tell you this: If a
company I was investing in decided that they couldn't figure out what
the revenues were going to be and they wanted to operate and just go
ahead and see what happens, make all kinds of investments, I would get
out of there in a hurry. There is not a company in America who will
make big investments if they do not know what the tax treatment is
going to be.
I am going to yield the floor, but I hope my colleagues are going to
join me in standing up for what is right for America and do things in
an orderly fashion.
I have heard the plea made so many times: Why can't we operate like a
business? Why can't we operate like families do? We want to do just
that. We want to operate just like a business that plans its actions,
lays it out on a piece of paper and says, ``This is going to be our
revenues, this is going to be our expenses, and this is where we want
to be 5 and 10 years from now.''
Instead, we now have a proposal that says, ``What we can do, ladies
and gentlemen, and the board of directors and the president of the
company, is we are going to ask you to hold your breath, we are going
to make the investment anyway and take the chance it is going to come
out right.''
Fire that guy.
I yield the floor and hope that my colleagues will assess the threat
that this reckless proposal poses to our Government, our Nation, and
our economy.
Mr. HUTCHINSON addressed the Chair.
The PRESIDING OFFICER. The Senator from Arkansas.
Mr. HUTCHINSON. Mr. President, in accord with the majority leader's
request that we move expeditiously, I will keep my remarks very brief.
I want to read one statement from the American Conservative Union, a
letter sent to all my colleagues, the last paragraph:
We are pleased to support your legislation, and will watch
closely for a clean up-or-down vote on the bill with a view
to including it in our upcoming annual rating of the
Congress.
I ask unanimous consent that the letter be printed in the Record.
There being no objection, the letter was ordered to be printed in the
Record, as follows:
The American Conservative Union,
Alexandria, VA, July 20, 1998.
Hon. Tim Hutchinson,
Dirksen Senate Office Building,
Washington, DC.
Dear Senator Hutchinson: On behalf of the nearly one
million members and supporters of the American Conservative
Union, I commend you for your introduction of S. 1673, the
Tax Code Termination Act.
The purpose of the legislation is simple: by abolishing the
current tax code by a date
[[Page S9124]]
certain, the legislation would force a national debate on
what kind of tax structure best fits our nation's needs,
while meeting the reform criteria of being lower, flatter,
and fairer. If enacted, the bill would force just such a
debate into the center of the 2000 federal elections, at both
the presidential and congressional level.
Such a debate is a necessary prerequisite for thoughtful
action to revise the code appropriately. A president elected
after such a debate will be able to lay claim to a mandate;
the Congress chosen in those elections will have to respect
that.
Some critics have suggested that the time-frame mandated in
the bill is too restrictive--that it doesn't allow the 107th
Congress enough time to reasonably hold hearings, draft,
revise, markup, amend, and then pass on the floor a total
rewrite of our tax code.
We believe the contrary to be true. With a termination date
set for December 31, 2002, and a call for a new tax code to
be in place by July 1, 2002, we believe there will be plenty
enough time for the 107th Congress to consider and pass
appropriate legislation.
We are pleased to support your legislation, and will watch
closely for a clean up-or-down vote on the bill--with a view
to including it in our upcoming annual rating of the
Congress.
Yours sincerely,
David A. Keene,
Chairman.
Mr. HUTCHINSON. Mr. President, also, I have a letter from the
National Federation of Independent Business in which they ``strongly
urge your support of the Hutchinson-Brownback amendment. It is time to
step forward and let the American people know that their elected
leaders have the courage to change a system which is anti-work, anti-
saving and anti-family. Now is the time to take action.''
I ask unanimous consent that this letter from the NFIB be printed in
the Record.
There being no objection, the letter was ordered to be printed in the
Record, as follows:
National Federation of
Independent Business,
July 23, 1998.
Hon. Tim Hutchinson,
U.S. Senate,
Washington, D.C.
Dear Senator Hutchinson: On behalf of the 600,000 members
of the National Federation of Independent Business (NFIB), I
urge you to support the ``Tax Code Termination'' amendment
that will be offered by Senators Hutchinson and Brownback to
S. 2312, the Treasury-Postal Service Appropriations bill.
The Hutchinson-Brownback amendment is a tremendous step
forward in the effort to abolish the current complex and
abusive tax code and replace it with a fairer, simpler code
for all Americans. The amendment would sunset the Tax Code
after December 31, 2002, but not until Congress acts prior to
that date by adopting a new, fairer system with a low rate by
July 4, 2002. Similar legislation recently passed the House
of Representatives on June 17, 1998. Passage of this
amendment would bring Congress one step closer to allowing
the American people, those who suffer the most at the hands
of an unjust tax system, to decide what system is fair and
simple.
The IRS Income Tax Code is beyond repair, imposing
excessive compliance costs on small businesses nationwide.
Yet, legislation to overhaul the Code has stalled in
Congress. The purpose of sunsetting the current code on a
date certain is to force Congress to get serious about fixing
our tax system. Small employers understand that a new plan
must be ready for implementation before the old code is put
to rest. But, as indicated by the 750,000 petitions they have
signed and presented to Congress, small business owners want
Congress to get started on scrapping the seven-million word
that causes them so much time, money and grief.
I strongly urge your support of the Hutchinson-Brownback
amendment. It is time to step forward and let the American
people know that their elected leaders have the courage to
change a system that is anti-work, anti-saving and anti-
family. Now is the time to take action.
Dan Danner,
Vice President,
Federal Governmental Relations.
Mr. HUTCHINSON. Mr. President, like Senator Lott, our majority
leader, I am most reluctant to offer this amendment in opposition to
the sentiments of the chairman of the Finance Committee. Likewise, I
have the utmost respect for my colleagues on the other side of the
aisle. I want to respond to a couple of things they said, my colleague
from Wisconsin and my colleague from New Jersey, who, to me, when they
talk about this proposal being something radical, what I hear in
response is the politics of fear.
They say, ``Well, we're not going to have a code, we're not going to
have a Tax Code.'' And then, ``We are not going to have the FDA, we're
not going to have FAA, we're not going to have roads, we're not going
to have Social Security.''
By the way, Social Security is omitted entirely from this bill. It is
not even a factor. But we hear the politics of fear--the sky is
falling.
Let me assure my colleagues, there is nothing as certain as the Sun
rising in the morning but that this Senate will have a Tax Code come
2002. I assure you that this Senate and this House will not allow this
Government to go without revenue.
My goodness, if you love this Tax Code so much and you like the
loopholes and you like the deductions and you like the exemptions and
you like the exclusions so much, then you can propose that we reenact
this Tax Code in total just like it is, and there you go. You go back
and defend that before the American people because that, I say to my
colleagues, is exactly what this debate is all about: Do you defend the
status quo, or do you want change?
Senator Roth--and I love this man. I respect him like my father, and
I think he has done marvelous work in so many areas in the IRS. But I
pose only this question to him and to all others who disagree with this
amendment: How long? The fear that we are not going to have it
enacted--here is the time line: 4\1/2\ years of national debate, and if
we can't get it done in 4\1/2\ years, then we can reenact this
wonderful Tax Code that those on the other side or those who oppose
this would like to defend. Four and a half years of national debate.
Long enough--long enough--to wait for tax reform.
July 1998, that is where we are now. Come November, we will have a
congressional election; November 2000, we will have a Presidential
election; July 4, 2002, we suggest in this amendment that we should
have a new code approved; November 2002, more congressional elections
before we finally reach December 31, 2002, the sunset date.
I suggest that is long enough. Let's give the American people what
they are demanding, and that is a Tax Code that is fairer and simpler
and friendlier.
Amendment No. 3249
(Purpose: To terminate the Internal Revenue Code of 1986)
Mr. HUTCHINSON. Mr. President, with that, I call up an amendment I
have at the desk, No. 3249, the Tax Code sunset amendment.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:
The Senator from Arkansas [Mr. Hutchinson], for himself,
Mr. Brownback, Mr. McCain, Mr. Abraham, Mr. Inhofe, Mr.
Grams, Mr. Smith of New Hampshire, Mr. Helms, Mr. Murkowski,
Mr. Coats, Mr. Sessions and Mr. Coverdell, proposes an
amendment numbered 3249.
Mr. HUTCHINSON. Mr. President, I ask unanimous consent that the
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
At the appropriate place, insert the following new section:
SEC. ____. TERMINATION OF INTERNAL REVENUE CODE OF 1986; NEW
FEDERAL TAX SYSTEM.
(a) Termination.--
(1) In general.--No tax shall be imposed by the Internal
Revenue Code of 1986--
(A) for any taxable year beginning after December 31, 2002,
and
(B) in the case of any tax not imposed on the basis of a
taxable year, on any taxable event or for any period after
December 31, 2002.
(2) Exception.--Paragraph (1) shall not apply to taxes
imposed by--
(A) chapter 2 of such Code (relating to tax on self-
employment income),
(B) chapter 21 of such Code (relating to Federal Insurance
Contributions Act), and
(C) chapter 22 of such Code (relating to Railroad
Retirement Tax Act).
(b) New Federal Tax System.--
(1) Structure.--The Congress hereby declares that any new
Federal tax system should be a simple and fair system that--
(A) applies a low rate to all Americans,
(B) provides tax relief for working Americans,
(C) protects the rights of taxpayers and reduces tax
collection abuses,
(D) eliminates the bias against savings and investment,
(E) promotes economic growth and job creation, and
(F) does not penalize marriage or families.
(2) Timing of implementation.--In order to ensure an easy
transition and effective implementation, the Congress hereby
declares that any new Federal tax system should be approved
by Congress in its final form not later than July 4, 2002.
Mr. DORGAN addressed the Chair.
The PRESIDING OFFICER. The Senator from North Dakota.
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Mr. DORGAN. Mr. President, let me make a few comments about the
amendment that has just been offered to the Senate.
The sponsor of the amendment asked the question: How long? How long,
he asks, will it take to get rid of the current Tax Code?
The answer to that is simply a long, long time, if the Senator who
offers this amendment, and others, suggest to us that we should, for
example, have a national sales tax of 30 percent or more. If the folks
who have gotten rid of this Tax Code have implemented a 30 percent
national sales tax--and, yes, that is what would be required to be
implemented to replace it--if you buy a house, they will say, ``Yes,
that house is $120,000, but then there is a 30 percent sales tax on top
of that.'' A fellow named William Gale from the Brookings Institution
wrote a policy brief on this: ``Don't Buy the Sales Tax.''
The reason I am discussing this is, the Senator does not tell us with
what he would replace the Tax Code. He simply says, ``Let's get rid of
the current Tax Code.''
There is plenty wrong with the current Tax Code. Count me among those
who would like to change the things that are wrong, but count me among
those who ask the question of the Senator who offers this amendment,
What do you propose to replace it with?
My understanding is, the Senator who offers this amendment at one
point was a cosponsor of a sense-of-the-Senate resolution calling for a
national sales tax. My understanding is, he took his name off of that
bill. Am I mistaken about that? Did the Senator add his name?
Mr. HUTCHINSON. Will the Senator yield?
Mr. DORGAN. I will be pleased to yield, of course.
Mr. HUTCHINSON. No, I have never--I have never--endorsed or signed on
to any measure, and to suggest that I favor a 30 percent national sales
tax or any form of sales tax is absolutely a misrepresentation and a
mischaracterization of my position.
Mr. DORGAN. Let me reclaim my time.
I appreciated the Senator's response. My understanding was--and we
can determine this--but my understanding was that early in this
Congress, the Senator added his name as a cosponsor to a resolution
here in the Senate calling for a national sales tax. My understanding
is he subsequently withdrew his name from that, but we can discuss
that, I guess, with respect to the people who have the records.
My point is this, Mr. Gale, who writes about the sales tax down at
the Brookings Institution, says that if you had a national sales tax
and are going to include all of the things that you need to include to
make up the revenue, that you have to have a sales tax of 30 percent or
more.
The only reason I am raising this question is, What do you intend to
replace the current Tax Code with? A value-added tax? A national sales
tax? Or any one of a half dozen other iterations? I do not know.
Then I ask the following question: With whatever you replace the
current tax with, do you intend to provide for a deduction for home
mortgage interest paid by someone who has just purchased a home and is
banking in the coming years on being able to deduct that home mortgage
interest? Is that part of some future plan or not?
Does one intend, for example, to provide for a deduction for health
insurance costs? Our current tax program in this country largely
provides for that as a business deduction. I am told that if that
deduction is eliminated, studies show that anywhere from 6 to 14
million more Americans will no longer have health insurance coverage.
Or what about charitable giving? Would what is proposed to replace
this with--whatever that is; we don't know what that is--would it
provide for a deduction for charitable giving? Some 1.4 million tax-
exempt organizations worry about that. At least one study suggests that
perhaps charitable giving could be reduced by some $33 billion.
So I ask the question, What does one propose to replace this with? I
say to my friend from Arkansas, I certainly do not mean to misrepresent
your record. I had been told that the Senator had at one point added
his name to a sales tax resolution. It is not my intention to
misrepresent that. If that is not the case, then I do not intend to
assert that.
But whatever the case is about the Senator from Arkansas and what he
harbors to replace this tax with, whatever that is, at some point
someone is going to have to say, ``By the way, here is what I feel this
should be replaced with. And here is how it is going to affect you.''
So I ask the Senator from Arkansas, since he is proposing that we
eliminate the current Tax Code by a certain date, could he tell us--and
I would be glad to yield for an answer--could he tell us what he
proposes to replace it with?
Mr. HUTCHINSON addressed the Chair.
The PRESIDING OFFICER. The Senator from Arkansas.
Mr. HUTCHINSON. I respond to the Senator, the whole point in having
the sunset date is to force us into a national debate to decide the
very question he poses. If I might continue, to argue the debate on
what the pros and cons are on a sales tax, flat tax, I would just say,
you can't do worse than what we have.
If you reach that point that you want to reenact this code, this
amendment allows you to do that. I suggest that we can and we must do
much better. And it would be putting the cart before the horse to say,
``This is what we must do.'' What we need to do is set the date forcing
us to reach that consensus on what should replace the current code.
Mr. DORGAN. Mr. President, let me ask a more specific question.
I think the Senator said: I don't know what we should replace this
with. I think that was the answer. Let me ask a more specific question.
If, in fact, one of the alternatives would be a national sales tax--and
certainly that is one of the alternatives--and if it would require
about a 30-percent tax rate, as it would according to studies, would
the Senator believe that that is an inappropriate replacement for the
current Tax Code?
Mr. HUTCHINSON. I, first of all, do not know to which study the
Senator is referring. There are many studies on the various rates of a
flat and sales tax. But what I would suggest is that the principles
laid down in the bill that I introduced and in the amendment that we
are debating would be violated by any type of a 30-percent aggressive
sales tax. Obviously, that would be something that I think would be
totally unacceptable.
But to throw up these fears: ``We're going to lose a home mortgage
deduction'' and ``We're going to lose a charitable deduction,'' that is
the politics of fear. That is what prevents us from moving forward to
real and comprehensive tax reform, in my opinion.
Mr. DORGAN. I think what the Senator is saying, in response to my
question, however, is he does not know what he would replace the Tax
Code with. He does not know how it would affect the American people,
does not know its impact on the economy. That represents a fear by a
lot of people. For example, it represents a fear by the group of folks
who represent the largest corporations in this country who work on the
tax policies for--I could read the list of corporations, but it is
virtually a who's who--Hewlett Packard, BellSouth, Alcan Aluminum, so
on and so forth. Here is what they say. Listen to what they say:
We're writing to express the institute's serious concern
about proposals to sunset the IRS Code on a designated date
without specifying a replacement tax system. In our view,
these proposals reflect either a misapprehension of the
importance of certainty and predictability to business
enterprises and individuals or a disregard for the
consequences of terminating the tax system. They illustrate
the folly of making tax policy by sound bite, and it ought to
be rejected.
I know these are the folks who run America's businesses who say we
need some certainty and predictability. They are not against reform.
That is not what they are saying. But they are saying that they need to
understand what it is you want to do.
You want to sunset the Tax Code on the one hand, and then I ask the
question, ``But what do you want to do on the other hand?'' You say
that just as the Sun sets in the evening, it is going to come up in the
morning. That is true. Just as you sunset the Tax Code now, you are
going to replace it with something. That is true. The question is, With
what? And you do not have an answer.
So is it reasonable for us to ask the question, Is part of the answer
a national sales tax or not? If it is not, let
[[Page S9126]]
us decide it is not. Is part of it a value-added tax or not? If it is
not, let us say it is not. If it is, let us decide who it impacts and
how it impacts in the American economy.
Mr. HUTCHINSON. If the Senator would yield?
Mr. DORGAN. I would be happy to yield.
Mr. HUTCHINSON. I think it would be very, very foolish of us to try
to have a national debate on tax reform on the floor of the Senate
tonight, for us to decide we are going to take a sales tax off the
table, we are going to take VAT off the table, we are going to take a
flat tax off the table, and we are going to take a modified or hybrid
of it, and we are going to decide this evening.
That is the whole point, I say to my colleague. The whole point that
we need a deadline is to move us to reach the consensus on what is the
best way. I suspect we will end up keeping a home mortgage deduction
and the charitable deduction. But we need that national debate. The
only way we are going to force that national debate is to focus--most
Americans are exactly where I am. They are not sure what would be the
best replacement. But they sure know this: What we have needs to be
replaced.
So let us take one step at a time.
Mr. DORGAN. Reclaiming my time, I do understand what the Senator is
saying. Let us force a solution. But he does not have a logical
solution. Let us tell the person on A Street or B Street or 10th Street
or 12th Street that we want to get rid of the current Tax Code--but he
has no idea how he wants to replace it.
There is a very big difference between those who would tax someone's
income at 14 percent and those who would impose a national sales tax at
30 percent and those who would impose a value-added tax at 17 percent.
There is a very big difference in how it impacts people.
The Senator wants to suggest, ``Gee, this is some innocent little
proposal of mine. Let's just get rid of the entire Tax Code'' which, by
the way, violates the Budget Act. And he knows that. ``Let's get rid of
the entire Tax Code and leave for some future debate the ability to
cogitate the kind of Tax Code we might consider for tomorrow.''
Count me as among those who want to make changes in our Tax Code. I
mean, do not count me as part of the target that the Senator was aiming
at when he was talking about all of these ``they, they, they'' and
``fear, fear, fear.'' Just count me as part of the group who says,
``Yes, let's make some changes in our Tax Code.''
But also count me as part of a group who believes that if you are
going to propose something to force solutions, you ought to have some
notion in hand about what those solutions ought to be and how much is
necessary to be collected in our revenue system in this country to pay
for the needed social services?
We build roads to go to market because we do not want to each build a
road separately. That would not make much sense. We build schools
together so we can send our kids to public schools. We do not need each
of us to have a school in our own home. So we do things together. We
provide for common defense. We have a Pentagon. We pay the men and
women of the military to provide for the common defense of this
country. That costs money. We, therefore, must raise that money. And
the question is, How?
We have an income tax system that isn't a very good system. You will
not find disagreement here about that. But you will find profound
disagreement about a proposal that says, let us simply scrap the
current tax system with no notion in mind about what you might replace
it with. Precisely for this reason, I have watched some people trot
around this Capitol Building, and on a good day they even gallop and
canter, alive and interested in their notion about how the Tax Code
ought to be changed. Some of them very much want to go to a national
sales tax and the Senator knows that.
They want to go to a national sales tax. That will have a substantial
impact on a lot of families; some good, some bad. Some of them want to
go to a value-added tax . Some of them want to go to other forms of
taxation. All of them will have significant consequences.
But the Senator from Arkansas says let's not debate the ideas,
consequences or the solutions. He says let's debate some mechanism to
force the problem, which also probably violates the Budget Act. I don't
understand that. I guess we will have a vote up or down on a proposal
that sunsets the entire Tax Code, with the author telling me that he
doesn't know what it ought to be replaced with and that we ought to
just figure out some way to get from here to there by some protracted
debate.
I don't think that is a particularly good way to legislate. I think
the Senator from Delaware, the chairman of the Senate Finance
Committee, a man for whom the Senator from Arkansas has great
affection, as he says, as do I, I think he has it exactly right. This
is not a good way to make tax policy. There would be an opportunity for
the Senator from Arkansas to bring to the floor his best idea about
exactly how the Tax Code ought to be changed. He can do that at 7
o'clock tonight; the best idea he has or anybody has about how to
change the Tax Code in this country. And then let people gnaw on it,
chew on it and see what they think, and have a vote on it. But that is
not what he and some others choose to do. They choose to bring some
shapeless package to sunset the current Tax Code, and to replace it
with nothing except some hope in the future that someone will do
something to provide the revenue in some undescribed way.
Again I don't believe that is a good way to legislate. Neither does
the chairman of the Senate Finance Committee, a Republican. Neither
does the National Association of Manufacturers. Neither does the Tax
Executive Institute, and many others.
Mr. GRAMS. Will the Senator yield?
Mr. DORGAN. I am happy to yield for a question.
Mr. GRAMS. I heard you say if this code were eliminated and replaced
with a possible national sales tax, it could take up to 30 percent of a
sales tax to replace what the Government has taken.
Now, does that mean hidden behind all the hidden taxes, that somehow
the Government now is taking from the average taxpayer, the average
worker in this country, 30 percent of their income just to support the
Federal Government?
Mr. DORGAN. The Senator obviously misunderstood what I said. I was
responding to a policy brief prepared by William Gale at the Brookings
Institution that says ``Don't Buy the Sales Tax.''
I have yielded. Let me have the floor.
I was talking about comparing the income tax to the sales tax. As the
Senator would know, I think there is a substantially different base.
Dr. Gale talked about this. I would like the opportunity to send it to
the Senator's office for his perusal.
On page 4 of the 10-page report documenting a study he had done, he
says a 30-percent tax rate would be needed on the more familiar tax-
exclusive approach on a national sales tax. He is one of the preeminent
authorities on this issue in the country. I have met with him, talked
to him, and enjoyed his work a great deal. I think he has done a lot of
good work on the question, What would a national sales tax have to be?
What would it look like? Who would it impact?
One of the things I find most interesting, whether it is on the sales
tax or the VAT tax, is that those in both the House and the Senate with
specific tax plans to replace the current Tax Code always come up a
couple hundred billion short in revenue.
What they say is, I want to sunset the current Tax Code, and here is
my substitute for it, and my substitute is a couple hundred billion
dollars short. They won't say that, but that is the way they are
evaluated when done fairly. Count me in on that. Gee, if you don't have
to come up with something that responds to the same revenue base, we
now have to meet the needs we have, then, gosh, maybe we should come up
with something that raises only 50 percent of the revenue. Or how about
10 percent of the revenue. That is a wonderful way to do business.
I see the people walking around with plans that would, A, increase
the Federal deficit substantially; and B, impose substantial
dislocations on a lot of folks and raise questions about whether you
would have the opportunity to deduct your home mortgage interest or
deduct your gifts to charities. Some of them, incidentally, say
[[Page S9127]]
to people, we have decided to have a new form of taxation.
I bet the Senator doesn't support another proposed new form of
taxation, though. We will divide Americans into two groups: One group
that works, and they get their money by going to work every day, and we
will tax them because we have decided to tax work just like the current
income tax does; and one who gets their money from investments, and we
will exempt them. Tax work; zero tax on investments.
I think that is the sort of thing that would be interesting to debate
on the floor of the Senate. The quicker we get to that debate the
better. Those who offer this amendment say we don't want to have that
debate; we want to simply sunset the Tax Code, and we don't want to
debate the sweet by-and-by. We don't want to debate the prospect of
what we might propose. Just asking the Senator from Arkansas what he
proposes, it occurs to me at this point we don't have a proposal. All
we have is a suggestion, get rid of the current Tax Code and maybe
tomorrow, maybe the day after tomorrow, we will come up with an idea so
you can then debate that on the floor of the Senate.
I have taken enough time. I hope when a point of order is made, as I
expect it will be made because this does violate the Budget Act, that a
good number of Members of the Senate will agree with the National
Association of Manufacturers, Tax Executive Institute, with the
chairman of the Finance Committee and others who say if we are going to
sunset the Tax Code, first propose exactly to the American people what
we would replace it with so they would have some knowledge and some
certainty about what this debate is all about.
I yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I appreciate the issue that is up before
the Senate, and I have the deepest respect for the author of this
amendment, Senator Hutchinson.
I must say, however, that this is a very bad amendment. It is a
profoundly bad amendment. It is a sound bite amendment. It is a feel
good amendment, and if it were passed, I guarantee it would have
profound adverse consequences upon our Nation.
Why do I say that? I say it because there is a reason why the Tax
Code is the way it is. We have to raise revenue somehow, obviously, to
pay our bills. But the reason the tax code has gotten so complicated is
because the American people over the years have come to Congress--to
Members of the House and the Senate--and have said ``here are some tax
provisions we would like.'' Members of Congress, by and large, don't
lead. That may be news to some of us, but by and large, Members of the
Senate don't lead. We tend to follow the American people. I'm not
saying this is bad. We should follow our employers, the people we work
for--the people who elect us. And it is the American people who, by and
large, ask us to do the various things we have in our Tax Code.
The home mortgage deduction has been mentioned many times because it
is such a good example of what I mean. While it makes the code more
complicated, there were very good reasons it was enacted and has
continued over the years. There are a whole host of other reasons why
the code has the reputation it has. We are an extremely large,
extremely complicated country. More so than I think any one of us here
realizes. There are so many different people in our country pursuing so
many different economic opportunities, so many different business
combinations. Our nation is even more complex as our economy becomes
more global, and we develop more opportunities overseas. And various
people in our country or its businesses have come to Congress and said
these are some of the things that we would like because we think they
will help the economy. That is why our code is the way it is.
There is no doubt about the fact that the code is complicated. It is
excessively complicated. We know that. We hear from our constituents
all the time that it is much too complicated. But I think it is
important to remind ourselves that there is a reason why, to date, we
don't have a flat tax, why we don't have a value-added tax, why we
don't have a national sales tax. It is because the American people have
not decided which, if any, of the alternatives they want.
Mr. DASCHLE. Will the Senator yield?
Mr. BAUCUS. I would love to yield to my good friend from South
Dakota.
Mr. DASCHLE. Mr. President, I appreciate the Senator for yielding. A
number of Senators are attempting to determine their schedules for the
evening, and I would like to propound a unanimous consent request, if I
could.
I ask unanimous consent that the Senator from Montana have 15 minutes
complete, including the comments he has already made, and that the
Senator from South Dakota have 5 minutes, and that the Senator from
Maine have 5 minutes, and that following the allocation of that time, a
vote be taken on this particular amendment and the motion to waive be
made at that time.
The PRESIDING OFFICER (Mr. Brownback). Is there objection?
Without objection, it is so ordered.
Mr. DASCHLE. I thank the Senator.
Mr. BAUCUS. Mr. President, the second problem with this amendment I
would like to mention is that it begs the question of what our current
Tax Code is going to be replaced with.
I must say there is something to the old adage that the grass is
always greener on the other side of the fence. It is part of human
nature to think that something else is always necessarily better than
what we have. That somehow a sales tax, or a value-added tax, or a flat
tax is necessarily going to be better than the current code. We all
know, if we stop to reflect a little bit, that sometimes you get what
you ask for and you don't like it because it didn't turn out the way
you expected it to be. So all of us who, in my judgment--and I must say
this sounds a little harsh--are being pandered to with this amendment
and are listening and are somewhat tempted to believe in this
amendment, should ask ourselves, realistically, how does life really
work? When people promise something great on down the road, is it
usually nearly as great as it is promised to be? Or to make the same
point a little differently, if we are going to accomplish something
that is good, generally it is through hard work and through rolling up
sleeves and dealing with the difficult details. Not demagoging,
pandering, or playing to the grandstand or to the crowd. That is
basically how we get something done that makes sense.
If this amendment is adopted, it is going to cause deep uncertainty
in America. We are proud in our country of the economic growth of the
last 4 or 5 years--low inflation, low interest rates, generally low
unemployment rates, high economic growth rates, and the stock market
has generally done well, although not so well in the last week or so.
But if this amendment passes, just think of all the people and all the
institutions that are not going to be able to plan very well for the
future and all of the uncertainty this is going to create. The list
goes on forever.
You can begin with business. Business has all kinds of tax
provisions. We can argue over the merits of these provisions, but they
are part of current law and businesses include them in their planning.
Let's take the business expense deduction that business now has. Are we
going to keep the deduction for ordinary, necessary business expenses,
or not? If you are a business person, you want to be able to deduct
your costs. Businesses aren't going to know if they are going to be
able to deduct those costs anymore. They don't know what the next law
is going to be. What about the farm provisions? They won't know what
the deductions are going to be for depreciation. They will have no
idea. So what is a business to do?
Let's take an individual with a home mortgage interest deduction,
which has been mentioned many times. What does this amendment do to the
real estate market, to home builders, carpenters, and electricians?
What does it do to people who depend on homes or are building or buying
new homes? They don't know if the mortgage deduction is going to be
there in a new tax system. You say it might be. That is what the
sponsors say, but they don't know that. Nobody could say with any
certainty whether any single tax provision will exist in a new system.
Then let's think a little bit about retirement. We have 401(k)s. What
about
[[Page S9128]]
this new Roth IRA we passed last year? A lot of Americans are worried
about their retirement security. They are worried enough about Social
Security. They want to be able to invest in IRAs and 401(k)s to save
some money so they can have a comfortable retirement. This amendment
says, no, we might not have those tax deferred savings plans anymore;
they might be gone. So what is a person today to do? Should he or she
invest in a Roth IRA or something else, independent of the code? Maybe
real estate. But we have already pointed out that real estate might be
in jeopardy because of what we might be doing here. Maybe they can
invest in gold. But we also don't know what the commodity markets are
going to be as a consequence of this amendment.
This amendment causes such uncertainty. Let's take the President's
budget--whoever the President is after the year 2000. He or she doesn't
know what kind of a budget to propose to Congress, doesn't know how
much revenue is going to be raised. Not only do we not know the
provisions and how we will raise revenue, we have no idea how much
total revenue we are going to raise--none, zero, nullity, no idea. How
is a President to propose a budget to Congress under those
circumstances? How is Congress to pass a budget resolution under those
circumstances? How is the Appropriations Committee going to know how
much money to spend? They won't know.
This is a kind of Russian roulette; it is a gun at your head. OK,
imagine this amendment is law and we are getting close to the deadline
in 2002. Yet we still don't have agreement on what to replace the
current code with. The proponents say this amendment will force the
Congress to act. But there is an old saying that ``haste makes waste.''
All too often we in Congress pass something very quickly that we
haven't thought about very much when we are under the gun, and we don't
fully understand the consequences of what we have passed.
I see the Senator from Maine sitting over there. I ask the Senator
from Maine, what is she going to be thinking when the years have gone
by, and here it is 2002 and, despite our best efforts, we haven't
enacted a replacement code yet? We have a choice--are we going to pass
an amendment to extend the deadline another year, another 2 years,
another 3 years? Doesn't that cause even more uncertainty?
Or say we are not going to extend the deadline, instead we are going
to push something through at the last moment. It ends up a hodge-podge
of proposals. Something like a value-added tax, with a little bit of
sales tax mixed in maybe. What will its impact be on the American
people? Nobody knows. I guarantee that the Senator from Maine is not
going to know and the Senator from Montana is not going to know. That
is probably what would happen.
There is something else we haven't talked about--Y2K, the computer
bug problem. We are very nervous in this country, and around the world,
about what is going to happen on January 1, 2000. Are the computers
going to work or not? I think it is a little foolhardy right now to
start to contemplate tax sunsetting in the year 2002 when we don't know
what is going to happen in the year 2000.
I must say, Mr. President, this is a sound-bite amendment. This is a
feel-good amendment. I have bent over backwards to try to see the
merits of this amendment; believe me, I have. I tell you that I am
disappointed, frankly, that an amendment like this is on the floor of
the Senate and apparently is being taken seriously--because if this
were to pass, it would cause just tremendous uncertainty in this
country. Americans' incomes would fall. America would be laughed at by
countries overseas. That might be a little strong, but they will
certainly wonder what the United States of America is doing; no country
would do something like this. Mr. President, I very strongly urge that
this amendment be defeated.
Let's talk about kids for a minute and HOPE scholarships. What is
going to happen to them? I don't say this as a scare tactic at all. I
am saying to the Senator from Arkansas that these are real concerns of
real people that I have mentioned. Say the Senator from Arkansas is a
student, and there is no income in his family, and he really depends
upon a HOPE scholarship to go to college. He wonders, gee, is it going
to be there or not?
To take a more definite provision, say he is going to buy a home, but
he doesn't know whether to buy a home or not. That is a real question,
Senator. It is not a scare tactic; it is a real question--if he or she
doesn't know if there is going to be a home mortgage interest deduction
or not, it is hard to tell whether he can afford to buy a home at all.
Say you are a homebuilder. Are you going to build homes? How many, and
at what price ranges? Those are real concerns of real people.
Let's talk for a moment about what this does to American companies.
Let's just look at fringe benefits, as one example. Employers generally
are allowed a deduction for fringe benefits, whether it is health
benefits or retirement benefits. What is going to be in the labor
contract when a labor union wants to negotiate a labor contract?
Negotiators won't know because they won't know what the Tax Code is
going to be. They won't know what to negotiate. The better solution,
obviously, is to address these real issues more calmly. I think that is
what we need here--something that is rational, that is collective, that
is out in the public spotlight, out of the hothouse of Washington, DC,
politics. And that is what is driving this right now--Washington, DC,
politics.
I am really mystified as to why this amendment came before us, and
why it is being taken seriously.
Mr. President, I yield the floor.
Ms. COLLINS addressed the Chair.
The PRESIDING OFFICER. The Senator from Maine is recognized for 5
minutes.
Ms. COLLINS. Mr. President, I am proud to rise in support of the
amendment offered by the Senator from Arkansas.
I ask unanimous consent that I be added as a cosponsor.
The PRESIDING OFFICER. Without objection, it is so ordered.
Ms. COLLINS. Mr. President, we must replace this country's Byzantine
and loophole-ridden Tax Code. How can anyone stand on the floor of this
Senate and defend it? Just look at our current Tax Code. It has been
estimated that it takes Americans 5.4 billion hours to do their taxes.
Our Tax Code currently consists of nearly 3 million words backed up by
nearly 10 million words of regulations. It is impossible to understand,
which is why it cost taxpayers an astounding $150 billion a year to
comply with.
Our Tax Code is riddled with loopholes that benefit special interests
at the expense of the general interest. Special interests have filled
the code with countless loopholes, poorly constructed tax writeoffs,
and expensive subsidies that benefit a few at the expense of the many.
Mr. President, our Tax Code is not like a fine wine that gets better
with age. It is more like a woolen sweater in a closet full of moths.
It acquires more and more holes all of the time, and after a while, you
just can't keep on mending it. You have to throw it out.
We want to write a new Tax Code that will provide all Americans with
a simpler, fairer Tax Code, a Tax Code that they deserve. And we want
to do it by Independence Day 2002.
Mr. President, I have been in the Senate about a year and a half now.
If there is one thing I have learned, it is that the Senate never takes
action--that the Congress never acts unless there is a deadline. The
Senator from Montana knows that better than most people. Does he really
think that we would have acted to reauthorize ISTEA, the transportation
bill that he worked so hard on with the Senator from Rhode Island
without a deadline, without the existing law expiring unless we act?
We are in a deadline situation right now as we rush to complete work
before the August recess. We all know what happens towards the end of
the fiscal year as we rush to complete work on the funding business to
keep our Government open. The fact is, Mr. President, that this
Congress will not act to do the necessary step of reforming our Tax
Code without a deadline.
It is not irresponsible to allow 4\1/2\ years for this task to be
undertaken. We are not prejudging the results. We are not saying that
the result has to be a national tax or some other possibility. What we
are saying is that America deserves a Tax Code that we can be proud of.
And the only way we are
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going to accomplish that goal is if we set a deadline.
Mr. President, the Tax Code is not going to expire overnight. We are
not proposing sunsetting it tomorrow, or next month, or even next year.
What we have laid out is over a 4-year period an adequate amount of
time to carefully and responsibly craft an alternative of which America
can be proud.
Mr. President, I am pleased to be a cosponsor of this important
legislation.
No one--let me repeat that--no one is going to allow our current Tax
Code to expire without a responsible alternative in place. But if we
are going to restore public confidence in Government, we must start by
ending the current Tax Code as we know it, and by crafting a well-
thought-out and responsible alternative.
Mr. President, I am pleased to be a cosponsor, and I urge my
colleagues to support this very worthwhile initiative. I commend the
Senator from Arkansas and the Senator in the Chair for their work in
this area.
Thank you. I yield the floor.
Mr. JOHNSON addressed the Chair.
The PRESIDING OFFICER. The Senator from South Dakota.
Mr. JOHNSON. Mr. President, I share the sentiment of the Senator from
Montana. This is a profoundly bad piece of public policy that should
never have appeared on the floor of this body in the first place.
The question is not whether we are for tax reform or not tax reform.
There is no such strawman to knock down.
The question is not only where will we go at the end of 4\1/2\ years,
for which the sponsors and supporters of this amendment seem to have
utterly no answer, but what happens in the intervening years?
The answer has been clearly laid out by the business community of
this country, which is overwhelmingly opposed to this legislation, and
by the thoughtful analysts, who also are overwhelmingly opposed to this
legislation. What happens during the intervening 4\1/2\ years of debate
as we struggle with whatever might come next is that business cannot
make an investment in a knowing fashion--whether it is concern about
capital gains, or depreciation tables, investment deductions, whether
it is individual citizens with their home mortgage, whether it is
questions about research and development tax credits, whether it is
questions about the future of pension law. The uncertainty will freeze
the American economy in a way that will assuredly slow down economic
growth, lead to lost income, and lead to deficit spending once again.
Mr. President, there is a good reason why the business community and
responsible business groups all across this country have so vigorously
opposed this legislation. They recognize this amendment for the bumper
sticker sloganeering that, frankly, it is.
There was a time early on in this debate when supporters of this
legislation noted that they felt this is a absolute political winner,
an opportunity to beat up on the Tax Code, which has no real
supporters, and on the IRS besides, without having to be accountable,
at least in the course of this election, for the ultimate results of
this legislation.
An interesting thing happened in the meantime, however. Some poll
work was done by the Republican National Committee showing that a
majority of voters in America already recognize this as a reckless
move--reckless. That is the finding of the American public which
already understands the political nature of what we have here--a bumper
sticker to abolish the Tax Code. It sounds good, if you are at the
coffee shop. We are not at the coffee shop. We are Members of the U.S.
Senate. And it is our responsibility to chart the economic welfare of
this Nation into the next century in a responsible fashion that
continues our economic growth in the coming years and which recognizes
that business needs certainty.
We can talk about tax reform, and we will do tax reform. I invite
additional debate on that issue. But to simply abolish a Tax Code with
no utter idea of what comes next in the meantime, during which American
business is left to fend for itself figuring out how to invest billions
and billions of dollars, is a sure recipe for disaster.
I have a sense that this amendment is not intended to pass. The
reason we are here is not to make public policy. The reason, frankly,
we are here debating this issue is because there are some who want a
slogan for the coming election in November.
I think that is regrettable. I think the American people deserve
better than that. Our economy needs better than that.
I think this is irresponsible legislation.
I see a colleague of ours on the floor, Senator Kohl of Wisconsin. I
see others who have significant business success in their own careers.
I have to wonder whether Senator Lautenberg of New Jersey, who spoke
against this amendment, who created a massively successful business
enterprise in his home State of New Jersey, whether he could possibly
have gotten off the ground in his business with the kind of uncertainty
that would, in fact, be created by this legislation.
Mr. President, the question is not tax reform, or not tax reform. We
all agree, I believe, that we need tax reform, and we need to push in
that direction. But this is sloganeering. This is pandering. This is
sham reform. The American public deserves better than this.
It also violates the Budget Act. I need not remind my colleagues that
it is the Budget Act that is responsible for bringing us 5 years in
succession of declining budgets. Budget deficits, which were $292
billion a year, are now a budget surplus because we abided by the
Budget Act.
Now, to violate that and to set up a recipe for the destruction of
our economy is utter irresponsibility. We deserve better than that. The
American public deserves better than that.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. JOHNSON. It is not going to pass. It is going to produce 30-
second television spots, no doubt, in November. But that is the reason
the American public has become so incredibly cynical about the American
political process.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. JOHNSON. This deserves to die here in the Chamber tonight.
Mr. KOHL addressed the Chair.
The PRESIDING OFFICER. The Senator from Wisconsin.
Mr. KOHL. I raise a point of order that the pending amendment
violates section 202(b) of House Concurrent Resolution 67, the
concurrent resolution on the budget for fiscal year 1996.
Mr. HUTCHINSON addressed the Chair.
The PRESIDING OFFICER. The Senator from Arkansas.
Motion to Waive Budget Act
Mr. HUTCHINSON. I move to waive the Budget Act for consideration of
the Hutchinson-Brownback amendment and ask for the yeas and nays on the
motion.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
waive. The yeas and nays have been ordered. The clerk will call the
roll.
The legislative clerk called the roll.
Mr. NICKLES. I announce that the Senator from North Carolina (Mr.
Helms) is absent because of illness.
I further announce that, if present and voting, the Senator from
North Carolina (Mr. Helms) would vote ``aye.''
Mr. FORD. I announce that the Senator from Iowa (Mr. Harkin) is
absent due to a death in the family.
I further announce that, if present and voting, the Senator from Iowa
(Mr. Harkin) would vote ``no.''
The PRESIDING OFFICER (Mr. Allard). Are there any other Senators in
the Chamber who desire to vote?
The yeas and nays resulted--yeas 49, nays 49, as follows:
[Rollcall Vote No. 241 Leg.]
YEAS--49
Abraham
Allard
Ashcroft
Bennett
Bond
Brownback
Burns
Campbell
Coats
Collins
Coverdell
Craig
D'Amato
DeWine
Domenici
Enzi
Faircloth
Frist
Gorton
Gramm
Grams
Gregg
Hatch
Hutchinson
Hutchison
Inhofe
Jeffords
Kempthorne
Kyl
Lott
Lugar
Mack
McCain
McConnell
Moseley-Braun
Murkowski
Nickles
Reid
Santorum
Sessions
Shelby
Smith (NH)
Smith (OR)
Snowe
Specter
Thomas
Thompson
Thurmond
Warner
[[Page S9130]]
NAYS--49
Akaka
Baucus
Biden
Bingaman
Boxer
Breaux
Bryan
Bumpers
Byrd
Chafee
Cleland
Cochran
Conrad
Daschle
Dodd
Dorgan
Durbin
Feingold
Feinstein
Ford
Glenn
Graham
Grassley
Hagel
Hollings
Inouye
Johnson
Kennedy
Kerrey
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Mikulski
Moynihan
Murray
Reed
Robb
Roberts
Rockefeller
Roth
Sarbanes
Stevens
Torricelli
Wellstone
Wyden
NOT VOTING--2
Harkin
Helms
The PRESIDING OFFICER. On this vote, the yeas are 49 and the nays are
49. Three-fifths of the Senators duly chosen and sworn not having voted
in the affirmative, the motion is rejected. The point of order is
sustained, and the amendment falls.
Mr. CAMPBELL. Mr. President, I move to reconsider the vote by which
the motion was rejected.
Mr. LAUTENBERG. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. REID. Mr. President, will the Senator from Colorado yield for a
unanimous consent request?
Mr. CAMPBELL. I yield to the Senator from Nevada.
Change Of Vote
Mr. REID. Mr. President, on the last vote, I was recorded as ``no.''
It will not change the outcome of the vote if I am recorded as ``aye.''
I would like the Record to reflect my having voted ``aye.''
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
(The foregoing tally has been changed to reflect the above order.)
capital visitor center legislation
Mr. WARNER. Mr. President, earlier this afternoon I indicated on the
Senate Floor that the Senate Committee on Rules and Administration may
hold a markup on Capitol Visitor Center legislation tomorrow morning.
After consultation with the Senate Leadership, I have decided to
postpone the markup until the House has an opportunity to review our
proposal.
____________________