[Congressional Record Volume 144, Number 135 (Thursday, October 1, 1998)]
[House]
[Pages H9263-H9270]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
REPUBLICAN 90-10 PLAN
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 7, 1997, the gentleman from Arizona (Mr. Hayworth) is
recognized for 60 minutes as the designee of the majority leader.
Mr. HAYWORTH. Mr. Speaker, and for those who join us from coast to
coast and beyond via C-SPAN, we make many historic decisions in this,
the people's House, and one made last week is one of the most profound,
with far-reaching consequences for the better, for our Nation and our
people. Because, Mr. Speaker, last Saturday in this Chamber the
majority passed a plan that said, quite simply, it is important that
this Congress sets aside $1,400,000,000,000 to save Social Security.
Now, it has been interesting to hear some of the debate that was
bandied back and forth; to hear some of the commentators and pundits,
but this historical fact is beyond dispute: Never before, Mr. Speaker,
in the history of this assembly, did anyone step forward to set aside
funds to save Social Security.
Oh, there were efforts to raise payroll taxes, and always it seemed
the temptation of raising taxes was something to which previous
majorities succumbed. But what this common sense conservative majority
did in this Chamber last Saturday provides a common sense plan not only
for Social Security but also for tax relief to the American people.
Those of us in our common sense conservative majority call it the 90-10
plan, setting aside 90 percent of the projected surplus, again,
$1,400,000,000,000 for Social Security, and using a very modest amount,
comparatively, for tax relief for the American people.
Mr. Speaker, I am joined tonight for this special order by one of my
colleagues from the Committee on Ways and Means, my classmate who
joined me in the new majority in that historic vote in November of 1994
as a newcomer to Congress in the 104th Congress, my seat mate now on
the Committee on Ways and Means, one who has worked tirelessly to
provide meaningful features of this tax relief plan. At this time I
would yield to my good friend, the gentleman from Illinois (Mr.
Weller), to talk about what in essence is the centerpiece of this tax
relief plan, this very prudent, this long-term profitable plan for the
American Nation, the centerpiece of the feature being relief from the
marriage penalty. I yield to my friend.
Mr. WELLER. Mr. Speaker, I thank my colleague for yielding me some
time to talk about what I consider to be a big victory, not only for
the people of Arizona and Illinois but people throughout this country.
It is because of the Republican majority in the last 3\1/2\ years that
for the first time in 28 years we have a balanced budget. Not only do
we have a balanced budget but, beginning today, October 1st, we have a
surplus, more tax revenue coming into the Treasury than we are
spending.
We have held the President as well as our own leadership's feet to
the fires. That freshman class of 1994 said that we were going to come
to Washington to change how Washington works. We have succeeded in
balancing the budget, and I am proud of that. And it is kind of
something new here in Washington, that we actually have more tax
revenue coming in than we are spending. We are more than living within
our means.
In fact, it is projected today by the Congressional Budget Office
that we expect to see over the next 10 years, thanks to a fiscally
conservative Congress, a $1.6 trillion budget surplus.
$1,600,000,000,000 in extra surplus tax dollars that are now in the
Treasury over the next 10 years because we have held the line on
spending. That is a big victory.
I want to point out that the balanced budget that we pushed through
Congress last year, and convinced the President to sign, contained no
tax increases on the American people. No income tax increases. In fact,
we gave, for the first time in 16 years, middle class tax relief to the
folks back home.
The gentleman was pointing out, of course, what is a big victory for
a lot of people, for all of us that are working Americans, those of us
who want to see the contract with working families, the retirement
contract that is Social Security, honored. And, of course, we recognize
that for people like my mom and dad, and when I think of Social
Security we always think about those closest to us, our family, and how
government in its ways and actions affect people we love and care
about.
When I think of Social Security, I think of my own mom and dad, and I
think of my Aunt Mary, and my Aunt Eileen, my Uncle Jack, my Uncle Bob,
and members of my family that are seniors, where Social Security is an
important part of their lives and their friends and their neighbors.
And for them Social Security is in good shape. But for the next
generation, my brothers and my sister's generation, for the baby
boomers and for those that follow, Social Security is in question.
Because of our concern in this Congress to save Social Security, to
ensure that we honor the contract of Social Security for the next
generation and future generations, I am proud that we set aside
$1,400,000,000,000 to save Social Security.
I mentioned earlier my sister Pat, when I think of the marriage tax
penalty. And I have often asked this question in debate here in the
House over the past year, and my colleague from Arizona and others have
joined us in this fight to eliminate what we consider to be the most
unfair provision in the Tax Code, and it is a simple question: Is it
right, is it fair that under our current Tax Code a married working
couple with two incomes pays higher taxes than an identical working
couple, with an identical income, that
[[Page H9264]]
lives together outside of marriage? They, instead, pay less. It is just
not right that under our Tax Code a married working couple pay more in
taxes just because they are married. And I am really proud that the
centerpiece of the tax provisions in the 90-10 plan will eliminate the
marriage tax penalty for a majority of those who suffer it.
It is really a simple solution in the way that we go about providing
tax relief to married couples, eliminating the marriage tax penalty for
a majority of married couples that suffer it today. It is estimated
that almost 28 million married working couples will benefit from the
marriage tax relief provisions in this package.
And it is pretty simple. The standard deduction is a standard
deduction we take if we do not itemize. And right now the standard
deduction for joint filers, in this case usually married couples
always, of course, is not equal to twice what the single filer has. In
fact, it is only $6,900. Now, we increase the standard deduction for
joint filers to $8,300, exactly twice what a single taxpayer is able to
claim. And in doing so, for 28 million married working couples they
will see an extra $240 in higher take-home pay, less money they are
going to send to Uncle Sam.
We eliminate the marriage tax penalty for a majority of those who
suffer it with our simple solution by doubling the standard deduction
for joint filers. I think of Joliet, Illinois, in the south suburbs of
Chicago. $240, that is a car payment. That is two months worth of day
care at a local day care center. That is groceries. That is a little
extra money to help pay for school clothes for the kids. And that is
real relief.
I am really proud that we made this the centerpiece of the tax
provisions in this 90-10 plan. Think about it. We are saving Social
Security with $1.4 trillion that was set aside. We are eliminating the
marriage penalty for those who, of course, are suffering it, for the
majority of those who suffer it. Twenty-eight million married couples
will benefit. And there is one additional benefit, too. As my friend
from Arizona pointed out earlier when we talked about this plan, what
is really exciting is our goal not only to lower taxes for working
Americans and working families but also to simplify the Tax Code.
One of the big benefits of doubling the standard deduction to twice
that of a single filer is 6 million taxpayers will no longer have to
itemize, will no longer have to use a schedule A. And in doing so,
filing taxes is going to be simpler for 6 million filers. They will
only need to file the 1040 EZ. That is a big victory. I am so proud
that we not only save Social Security and eliminate the marriage tax
penalty for so many, but this 90-10 plan received bipartisan support
when it passed the House last Saturday, and I am proud to be a part of
this.
Mr. HAYWORTH. I thank my colleague for the work he has done in
focusing attention on the marriage penalty, one of the many features of
our Tax Code that was just plain wrong. It did not make sense to
penalize married couples, when other couples living out of wedlock were
enjoying economic benefits as opposed to those who played by the rules,
worked hard and observed the institution of marriage.
There are so many different things that we are offering in this
relatively modest package of tax relief. Again, remember, we are
setting aside $1,400,000,000,000 of the surplus to stay, to strengthen,
to save Social Security, and only 10 percent of the projected surplus
would go to tax relief. But in that package I think especially about my
district and the seniors who live in my district and the many seniors
who find that they have to work. As much as they would like to have the
leisure time, their situation demands that they still need to earn an
income.
And what we have done, as part of this bill of tax relief, is to
increase the amount of money seniors can earn without losing Social
Security benefits by increasing that earnings limit; to raise that,
understanding that some people, A, enjoy working, they still want to be
active, they appreciate the dignity of work, and they do not want to be
penalized for working but; B, some folks, quite frankly, need it to
make ends work. Why then would we seek to punish those seniors? And
that is another area that is so vitally important.
My friend has another point to make, and I would gladly yield to him.
Mr. WELLER. I thank the gentleman. And I often think about seniors
who we see working at restaurants, or they operate a small business on
the side. We even see them at the arts and crafts shows. And it is just
wrong that if we look at the Tax Code that senior citizens who have
worked hard all their lives, and seniors are active longer, they are
living longer, they want to be active longer, many want to work longer,
of course they would like to have a little extra income, and it is
really wrong that they are punished for working longer.
So that is why I think that raising the Social Security earnings
limit to the level that we raise it makes a big difference for these
seniors; that if we do not raise the earnings limit, they will have
more of their Social Security benefits taxed away, and that is wrong.
So by raising the Social Security earnings limit, we help a lot of
seniors in Arizona, in Florida and Illinois.
And one thing I wanted to point out is that, of course, as we work on
strengthening Social Security for the long term, a key part of that, I
believe, is encouraging people to save for their retirement. And
another provision in this tax package that I think is so important, as
we help those who work hard and save a little for their retirement, for
their future, is the Savers Act portion here.
And of course our colleague, the gentleman from Missouri (Mr. Kenny
Hulshof) really had the lead on this. A key member, a new member of the
Committee on Ways and Means. His savers exclusion, which was included
as part of this package, was a real winner if we want to encourage
people to save for their retirement.
Because under this 90-10 plan we allow someone to have their first
$100 in savings interest or dividend income exempt from taxes for a
single taxpayer. And we also recognize, so there is no marriage tax
penalty, that we allow the first $200 in savings interest for a married
couple. What that essentially means is a married couple can have
$10,000 in a bank account or a savings account, and the interest on
that is tax free.
Not only do we reward saving for retirement, I would like to point
out that is one more way that we simplify the Tax Code. It is estimated
that 68 million taxpayers will benefit from exempting the first $100
for singles, $200 for couples from income taxes.
Not only will 68 million taxpayers benefit, but also it helps
simplify the Tax Code. There is that Schedule B. That is where we
report our dividend interest and dividend income in the taxes. And we
helped simplify it because this will allow 10 million taxpayers to
simplify their tax filing to the point where they only have to file one
form. They will no longer need to itemize.
Think about that. Ten million taxpayers and seven million people will
no longer need to file a Schedule B. So 17 million taxpayers will see
their tax filing experience, which no one likes, simplified. That is a
big victory. I thought it was important to point that out.
Mr. HAYWORTH. One of the things we have learned since coming to the
Congress of the United States is just how important it is to listen to
our constituents. When I was back home over the district work period,
holding in excess of 30 town hall meetings, what I heard time and again
from the folks who live in the Sixth Congressional District of Arizona
is that they wanted to see now, as we move to the policies of surplus,
that we set aside the surplus for three things: that we save Social
Security; that we help pay down the debt, the $5.5 trillion debt, which
hangs over the heads of our children; and that we understand again a
hard and basic truth that has been difficult for folks inside the
District of Columbia to understand, and it is a simple statement, very
commonsensical, but sometimes the logic escapes people here, and it is
this notion: that the funds that come from the pockets of American
citizens belong to those citizens, not to the government.
To the extent possible, working people should hold on to more of
their hard earned money and send less of it here to Uncle Sam, and that
is the logic and the notion behind tax relief.
Mr. WELLER. The gentleman has brought up a really good point. As we
[[Page H9265]]
have shared many times in our conversations, we have talked about our
districts and the good people we have the privilege of representing, I
represent a really diverse district, the south side of Chicago, the
south suburbs in Cook and Will counties; bedroom communities like
Morris, where I live, and a lot of corn fields and farm towns.
Whether I am at the grain elevator, the union hall or the VFW or a
local Business and Professional Women's meeting, I find there is a lot
of common concerns, and saving Social Security, eliminating the
marriage tax penalty, helping farmers, helping small businesspeople,
helping families who want to set aside a little money to help put the
kids through college and, of course, this 90-10 plan, accomplishes
that.
I had a senior citizen come up to me this last couple of days while I
was back in Illinois and he said, Representative Weller, what I am
really excited about with that Social Security savings plan and the
marriage tax elimination and the other tax provisions in the 90-10
plan, is I remember when President Clinton gave his speech back in
January.
Remember that State of the Union speech? The President said, let us
save Social Security first and let us set aside the surplus for Social
Security? I stood up and applauded and we all did in a bipartisan
effort because we wanted to save Social Security.
That senior pointed out, he said, Representative, you folks did twice
what the President asked for because when the President said set aside
the surplus, there was $600 billion in projected extra tax revenue.
Well, nine months later, there is a projected $1.6 trillion extra tax
dollars now in the treasury and we set aside $1.4 trillion. That is
more than two times what the President asked for. That is going to help
us save Social Security not only for today's seniors but particularly
for the baby-boomers and the future generations that are looking to
Social Security as part of their retirement income.
I thought it was real important to share that experience and that
conversation back home.
Mr. HAYWORTH. Mr. Speaker, I would point out one other fact that I
hope that American citizens will keep in mind. When the President of
the United States graced us with his presence and stood at the podium
behind us here, he not only said that every penny should go to save
Social Security, we should save Social Security first, but sadly his
actions failed to reconcile with that promise. For, even as he made
that promise from the podium behind us here, he subsequently spent
almost $3 billion in Bosnia, which points up the other basic truth of
the pitfall of the great debate that continues in this chamber and
across America.
As my constituents tell me, the sad fact is, if we leave money in
Washington, Washington spends the money. It belongs to the American
people and that is money that should return to their pockets.
Mr. Speaker, we are joined here tonight by another colleague. I look
and see another classmate from the 104th Congress, our good friend, the
gentleman from Pennsylvania (Mr. Fox), who joins us here on the floor
tonight.
Mr. FOX of Pennsylvania. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from Pennsylvania.
Mr. FOX of Pennsylvania. Mr. Speaker, I thank the gentleman from
Arizona (Mr. Hayworth) for yielding.
Mr. Speaker, I am very proud of the efforts of the gentleman from
Arizona (Mr. Hayworth) on the Committee on Ways and Means to lead the
fight to have the tax relief and to help our seniors in saving Social
Security. I know we are joined by the gentleman from Missouri (Mr.
Hulshof) and also the gentleman from South Dakota (Mr. Thune).
I think it is important that we be able to show this collective
bipartisan effort to really help our seniors make sure that Social
Security is secure.
I would say to my colleagues it is interesting to note that 60-plus,
the fastest growing seniors advocacy group in the United States, has
endorsed this 90-10 plan, which does exactly what the American people
want. They want a Social Security system that is going to be secure,
and with $1.4 trillion being placed in the Social Security trust fund,
that is more than twice the amount of money that has been owed from
prior Congresses.
The fact that we are able to make sure the marriage penalty
elimination is going to help seniors and others, and the fact that the
saver's tax exemption is going to help seniors and others, and the fact
that reducing inheritance taxes is going to help seniors and others,
shows that we have made our first initiative here to make sure that
seniors have a Social Security system that is secure; then a modest tax
decrease, which I think the American people deserve. It is their money
after all.
This is really a great accomplishment. I am hoping that the Senate
will move forward, agree with us and then eventually have the President
sign the bill as well.
Mr. HAYWORTH. Mr. Speaker, we are joined also tonight by two
colleagues from the freshman class of the 105th Congress, two gentlemen
who hailed from States where agriculture is of vital importance, and I
look to my left, very rarely philosophically do I find this gentleman
on my left, but my friend, the gentleman from South Dakota (Mr. Thune)
joins us.
Mr. THUNE. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from South Dakota.
Mr. THUNE. Mr. Speaker, I want to thank my friend from the desert,
the gentleman from Arizona (Mr. Hayworth), for yielding and thank him
for the great work that he has done on the Committee on Ways and Means
and our other colleagues on the floor this evening; the gentleman from
Missouri (Mr. Hulshof), who authored the small saver exclusion in this
bill, which is so critical, too, for a lot of people in this country
who are trying to save some money and is going to simplify the Tax
Code.
There are a lot of people who will not have to fill out schedule B in
the future and that is a significant thing, and the gentleman from
Illinois (Mr. Weller), our distinguished colleague, who is responsible
primarily for bringing forward and making the crown jewel of this tax
cut package the marriage tax penalty relief.
What I would like to do just briefly is touch on a couple of other
aspects of this bill which is very important in my part of the country,
and that is in the world of agriculture. I might begin by saying that
the last time we had a balanced budget in this country I was 8 years
old. We have been living in this culture of debt now for the past 30
years, all of my adult life basically. It is just an amazing, I think
remarkable, accomplishment.
The American people should make no mistake about it. The reason we
are where we are is thanks to their hard work but also to the
Republican majority in this Congress who when they were elected, when
they came in in 1994 and we joined them in the 1996 and 1997 session of
Congress, set upon a path of getting our fiscal house in order, making
the hard decisions about spending and lowering taxes, which in the end
has actually raised revenues so that we are in a position now to bring
some additional tax relief.
Let me just briefly say on behalf of the farmers and ranchers of the
country, and certainly those that I represent in South Dakota, that
this is a wonderful plan for agriculture. The estate tax relief that is
in here, the death tax relief which allows farmers and ranchers and
small businesspeople to pass on their operation to the next generation
without having to deal at the same time with the Internal Revenue
Service and the undertaker, is, I think, a real tribute to the work
that was done by this committee and a real asset and a real benefit to
the producers of this country.
The health insurance deduction for self-employed individuals is
critical. There are so many people in this country who are not able to
deduct the premiums that they pay for health insurance policies and
this allows for that to happen; an average benefit of about $382 to
some 3.3 million people in this country who will benefit from that
provision in the bill.
There is a small business expensing provision which will allow
farmers and ranchers again the benefit of increasing the amount that
they can expense out, and also a loss carryback provision for those who
are experiencing losses, and there are a lot of them in
[[Page H9266]]
my part of the country right now who, due to the price disaster, are
losing money. It has been a tough couple of years, but they can take
those losses and offset them against more profitable years and get a
refund this year, which will tremendously help the cash flow situation
and the problems that they are facing in trying to deal with the
working capital they need to stay in business.
These are all provisions, in addition to income averaging which makes
permanent that provision that allows farmers to spread out their income
over time, and thereby lessen their tax liability in any one year.
Farming and ranching is a very volatile industry when it comes to the
income that they generate, a lot of ups and downs.
There are many provisions in this that are good for agriculture, and
I think it is just remarkable at the same time we were able to dedicate
$1.4 trillion to saving Social Security and be able to help the farmers
and ranchers of this country who desperately need help right now, who
are trying to recover from the economic crisis they are in, in the form
of tax relief.
I think this is a wonderful package and one that I hope we can move
forward in the Congress, and I want to give credit to those of my
colleagues who were instrumental in the Committee on Ways and Means and
my friend, the gentleman from Pennsylvania (Mr. Fox) here as well who
is on the floor this evening. I look forward to moving this and
advancing it in the process in the hopes that we can make it the law of
the land and help out those people across this country who have worked
hard to give us the surplus and who deserve to have some of it back.
Mr. HAYWORTH. Mr. Speaker, let us not forget that a previous liberal
Congress put upon the American people the largest tax increase in our
history. Indeed, to quote a member of the other body on this hill, a
liberal Senator from New York State, he said it was not just the
largest tax increase in American history but the largest tax increase
in the history of the world.
If there is one primary difference, it is this: Our common sense
conservative majority believes that, Mr. Speaker, the folks who live in
this country, who work hard and pay the bills, have worked very hard
for the money they earn. They need to hold on to more of it and send
less of it here to Washington.
My friend, the gentleman from Pennsylvania (Mr. Fox), has one point
that he wants to bring out and I am happy to yield some time to him.
Mr. FOX of Pennsylvania. In my discussion previously, and I wanted to
add on to what the gentleman from Arizona (Mr. Hayworth) said earlier,
I had spoken, of course, of the programs to strengthen Social Security
but also talked about modest tax decreases. I may have inadvertently
said another word, but it is decreases and the tax cuts that are so
important to our constituents back home. It is their hard earned money
and we want to not only make sure that passes, but the private prepaid
tuition plans are excellent. The bond value caps can help us with
affordable housing, and also to help us with the school construction.
All by having tax cuts, we are helping our communities. It is the
opposite of what we had in the prior forty years with democratic rule,
with tax increases which actually hurt us from having more jobs in the
private sector.
Mr. HAYWORTH. Mr. Speaker, now to my right, fittingly, although he
stands at the other microphone here in the well, it is another newcomer
in this 105th Congress, the gentleman from Missouri (Mr. Hulshof), who
has played a major role on the Committee on Ways and Means in bringing
the tax bill to the floor and seeing its subsequent successful passage
here in this chamber.
Mr. HULSHOF. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from Missouri.
Mr. HULSHOF. Mr. Speaker, I thank my friend, the gentleman from
Arizona (Mr. Hayworth) for yielding.
Mr. Speaker, the gentleman from Pennsylvania (Mr. Fox) has it just
right. There is so much about this tax cut package that is to like.
When we had this debate last week, as the gentleman knows, there was a
lot of discussion and a lot of rhetoric being thrown around by our
friends on the other side, especially when we talked about Social
Security.
The beauty of this particular provision is that we want to take 90
percent of the projected surplus and put it aside to save Social
Security; surplus funds, not monies needed to balance the Federal
checkbook.
In fact, I came, Mr. Speaker, to this very floor and caused, I think,
a little consternation because I had ten one dollar bills in my hand
and I said, we have been talking in trillions and billions of dollars
and sometimes that is a difficult concept to grasp, these numbers with
so many zeroes. Let us think of it this way, and I had ten one dollar
bills.
We wanted to take nine of those ten and fold them up and put them in
our pocket and put that aside to save Social Security, to make sure
that Social Security is there not just for today's seniors but for
tomorrow's as well. Simply, what we want to do is take one dollar of
the surplus funds, one dollar out of ten, and leave it in the pockets
of those who earned it.
I am troubled by the statements made at the other end of Pennsylvania
Avenue and talks of potential vetoes. In fact, the White House even
said that we were, quote, squandering the surplus, squandering the
surplus, by letting the American taxpayer keep what is rightfully his
or hers.
There are so many things in this particular provision. The gentleman
from Illinois (Mr. Weller) is exactly right. When trying to at least
make a down payment on the elimination of the marriage tax penalty, we
have much further to go, but certainly when my wife and I a few short
years ago stood at the altar and said I do, it was not I do want to pay
more in income tax, and yet that is the plight of many married couples
in this country.
Simply by investing in the institution of marriage, their tax bill
has gone up. I think that this provision does a good job of trying to
level the playing field.
As the gentleman from South Dakota (Mr. Thune) talked about, farmers
and ranchers who are having a difficult time right now in this country,
there is relief for those farmers and ranchers, small businesspeople,
with the death tax. All of those things are addressed, as the gentleman
from Pennsylvania (Mr. Fox) talked about, the head of our economic
development back in Missouri wrote a letter on behalf of our governor,
a democratic governor as it turns out, urging us to increase the
private activity bond cap because of the affordable housing issue. It
is addressed in this bill.
{time} 2145
One of the things that I want to visit about is something that we
have worked on specifically that would leave that dollar of that
surplus money in the pockets of the low and middle income people in
this country, and that is those who try to save, those people who try
to put away their pennies and nickels. When you think about it, Mr.
Speaker, they are being punished for their thrift.
I happen to have a 1040 form over here, modified just a bit, with a
big circle and a slash. But when you think about, and I know this is
maybe painful for you to think about April 15th of each year, but when
you think about having to pull out the files and start to fill out your
1040, as we do most spring months, obviously most taxable income of
most Americans is wages and salaries.
But when you consider that those of us that are able to put aside a
little bit into a money market account, or maybe an interest bearing
checking account, and any interest that we earn is being taxed, it is
included in taxable income. And you carry it down here and you are
being taxed on that amount, as you are the rest of your income, when
many other countries actually provide some more incentives for their
citizens to save and invest.
What this bill does is simply allow an exclusion up to $400, if you
are a married couple, as the gentleman has been talking about with
married couples, allowing joint filers to exclude up to $400 of
interest or dividend income, to not be taxed, to put that back perhaps
into other investments.
The Congressional Research Service has recently done a study just on
this small saver provision that said this proposal would really benefit
the low
[[Page H9267]]
and middle income taxpayers, because it hits them more proportionately
than it would somebody down at Wall Street. Of course, having thousands
of dollars in investments a $400 exclusion is not likely to help that
individual very much.
As the gentleman from South Dakota talked about a moment ago, not
only is this good in a broad-based way as far as providing relief for
millions of taxpayers, the small saver provision is helping 68 million
taxpayers, but, more importantly, it is an issue of simplification.
I know a year ago when we had the debate about taxpayer relief of
1997, one of the constructive comments was this was not something that
added to simplification of the Tax Code. This bill we passed in the
House does just that.
As the gentleman talked about, how many millions of taxpayers will
not have to itemize any longer, just because of the marriage tax
penalty elimination? I know that certainly millions of taxpayers will
no longer have to fill out this Schedule B form, the interest and
dividend income exclusion. So we are simplifying the Tax Code.
By not requiring those additional calculations and forms, some I
think 10 million Americans will no longer have to file a 1040, they can
file a 1040 EZ just because of the small saver provision. Seven million
will not have to trouble themselves with the Schedule B if this small
saver provision is signed into law by the President. So not only are we
providing broad-based relief, we are simplifying the Tax Code, which I
think is something even our friends on the other side support.
Mr. HAYWORTH. I thank my colleague from Missouri. As we take a look
at the many different provisions, and as I hear my colleagues remark on
the different provisions that benefit hard working Americans, Mr.
Speaker, I am reminded again of the many town halls that I have held
back in the 6th District of Arizona, and I hear from people, and
perhaps we ought to change the nomenclature, because we so often
casually refer to small business. I think, Mr. Speaker, we should
change that notion and redefine small business as essential business,
because really those essential businesses, not with thousands upon
thousands of employees, but those smaller enterprises, sometimes called
mom and pop operations, indeed form the backbone of our economy, for
those essential businesses, or, in common nomenclature, those small
businesses employ more people than the corporate giants.
Especially for those Americans who are self-employed, how much I have
heard at town hall meetings, ``Congressman, I am self-employed. When
can I deduct my health insurance costs like the big guys in corporate
America?'' And this bill does that, allowing for 100 percent deduction
of health insurance premiums for the self-employed, including so many
of our hard working constituents down on the farm.
My colleague from Illinois, raised on a farm, understands what this
means. How vital it is that we accelerate that, how important it is for
so many Americans who have waited for so long to enjoy what others in
corporate America at least have not taken for granted, but have
benefitted from in years past with our Tax Code.
The gentleman from Illinois.
Mr. WELLER. Mr. Speaker, I would like to thank the gentleman from
Arizona for yielding. The point the gentleman is making is such an
important one. We often talk about small business, and I consider small
business to be Main Street, and, of course, two-thirds of the jobs that
are created in our Nation and our economy every year are small
business.
I meet on a regular basis with a group of women entrepreneurs in the
south suburbs, and they made a point to me that I took to heart, a
lesson. They said when you think about small business issues, small
business issues are women's issues, because the majority of new
businesses that are created and started every year today, the majority
of them are started by female entrepreneurs. In the State of Florida,
two-thirds of new entrepreneurs are female, are women entrepreneurs.
I think that is why what we did last year with restoration of the
home office deduction is so important, because many of the women
entrepreneurs, they start a business in the home.
Of course, then the health insurance issue is so important, not just
to women entrepreneurs, but to male entrepreneurs and all small
business people and farmers and entrepreneurs. When you think about it,
our goal is to make sure that health insurance is affordable for
everyone. Our goal is giving everyone access to affordable health care.
Of course, we should really work to achieve that goal.
This is a big step, because by giving the self-employed, the
entrepreneur, the same tax deduction that the big corporations on Wall
Street get, it is an issue of fairness. We are working to bring
fairness to the Tax Code by helping these entrepreneurs, which I
pointed out earlier the majority of are female-owned enterprises, that
is a big victory.
But the 90-10 plan is good for education, and helping our schools and
those who want to send their kids to college and local schools has been
a priority in this Congress in the last four years that I have had the
privilege of serving here.
I think it is important to note that some of what some people say are
the smaller provisions in this tax package actually are pretty
important.
Last year we gave tax exempt treatment to prepaid college tuition
programs for state universities, such as the University of Illinois and
the other state universities in the State of Illinois that offer them.
States like Pennsylvania and others do as well. But we bring fairness
to the Tax Code by extending that same tax exempt treatment to the
small private colleges, schools such as St. Francis and Olivet Nazarene
University and Lewis University in the district that I have the
privilege of representing now will be able to offer prepaid college
tuition programs and help parents who want to send their kids off to
college in a few years be able to make the tuition much more
affordable. That is a big victory.
I also represent a growing suburban and urban district. One of the
challenges we have in the older urban areas is the school buildings are
older. We have maintenance, and we want to wire them with fiber for
computers, and keep the technology up as well as keep the roof from
leaking, they need help.
Last year we passed a school construction bond program as part of the
tax package. We also provide over $1 billion in school construction
bond assistance to not only the old urban schools in need of repair,
but also help those suburban school districts in need of adding
additional classrooms. I think that is very, very important.
Of course, raising the bond cap, as my colleague from Missouri
pointed out, it is so important. We provide for a 50 percent increase.
That is to be a big help in states like Illinois, not only helping to
provide affordable housing for working and moderate income families,
but also in helping infrastructure, such as helping expand our schools.
I think it is important to point out that this tax package helps
married couples, family farmers, small business people and
entrepreneurs, and also those who want to send their kids off to
college, and helps schools add on additional classrooms and keep the
roof from leaking.
Mr. HAYWORTH. I thank my colleague from Illinois for raising this
part of this very human equation, because there is a temptation when we
start talking about tax bills and tax relief to somehow put on the
green eyeshade and pull out the calculators or the slide rules and deal
with numbers, and, please, do not get me wrong, the numbers are
important, Mr. Speaker, especially the $1.4 trillion which we pledged
to set aside for Social Security.
But, moreover, there is a concept here that my colleague from
Illinois touched on, and it is this: There are those in this city who
still fail to learn the lessons of history, who would still have us
believe that a centralized bureaucracy can make decisions for your
family, for your school district, sadly I suppose ultimately for your
children in a lot of ways, and I think our new common sense
conservative majority says this: That we believe education is too
important to leave up to Washington bureaucrats. There is no way that
folks inside this beltway can micro-manage education. Indeed, sadly,
one need only look to the schools inside this District
[[Page H9268]]
of Columbia to see what disarray can befall an educational system at
the hands of big government solutions and more and more spending with
less and less accountability.
So what we are saying in this tax bill is for local school districts,
to have provisions that they can use for capital improvements, for
construction, for renovation. As my colleague from Illinois points out,
that is the key. We understand that not all the answers exist inside
the Beltway in Washington D.C., and we are better served when we
transfer money, power and influence out of Washington and back home to
people on the front lines, living their lives, educating their kids,
and seniors in the dignity of retirement.
Mr. HOLSHUF. Mr. Speaker, if the gentleman would yield, there is
another provision in this bill that I think has not been getting a lot
of attention, and I know last year when we were debating tax relief,
that we heard the mantra, the weary mantra from the other side, ``tax
breaks for the wealthy.'' Yet in this particular bill, a colleague from
the class of 1994, the gentleman from Oklahoma (Mr. Watts) working with
another colleague from Missouri, a neighbor of mine, the gentleman from
Missouri (Mr. Talent) from the 2nd Congressional District, the Watts-
Talent Community Renewal Provision, again, to set up I think 20
separate empowerment zones, especially in these areas, you were talking
about the schools, but especially in these inner-city areas that have
become blighted, where we have seen businesses that have fled from
those inner-cities to the suburbs. This particular provision would have
zero capital gains for private industry that chooses to go back into
the inner cities, to revitalize and renew those communities. That
provision is in this bill as well and has not been getting much
attention.
Again, I think what all of these very strong provisions, I dare say
that I do not understand how the White House can talk about vetoing,
and that is casting aside this very good tax package, with all of the
things included, plus this very important community renewal provision
that has been cosponsored by the gentleman from Oklahoma and the
gentleman from Missouri.
Mr. HAYWORTH. Again, there are so many positive provisions of this
bill that I think all of us on this floor stand in amazement to hear
the mindset of those on the left who, after 40 years time, never set
aside a single penny for Social Security, Mr. Speaker. That is right,
zero, zip, zilch, nada, not even an idea of how to set aside funds to
save Social Security.
Yet to hear the tired old chorus, they would have you believe some
sort of cynical mumbo-jumbo that this is something that Americans are
not entitled to. It is some sort of gimmick.
No, Mr. Speaker, I think all of us on the floor and those of us who
voted for this common sense tax policy say quite the contrary: This is
not a gift to the American people. This is money that belongs to the
American people. We do not sit here and deign to give them a pittance
of what they sent in to Uncle Sam. It is their money to begin with.
So, Mr. Speaker, tonight as we continue to review these provisions,
let us respectfully take issue with those who time and again come to
this floor, or sadly on an annual basis to the podium behind us here,
and display a mindset that would seem to suggest that tax relief for
working people is candy or dessert or some special gift, as if it is an
accident.
{time} 2200
Indeed, Mr. Speaker, the group here on this floor right now and other
colleagues in this majority were sent to Washington precisely because
the American people understand that they are not selfish for wanting to
provide for their own families; that they are not selfish for wanting
to have a greater control of their own destiny and their own futures;
that they are not selfish for saying to Washington bureaucrats, we
earned this money. We want to see a strong Federal Government, but not
a government powerful enough to take away everything we have. That is
the difference. Tax relief is not selfish; tax relief undergirds the
notion of individual freedoms and a sense of responsibility.
I yield to my friend from Pennsylvania.
Mr. FOX of Pennsylvania. Mr. Speaker, I thank the gentleman from
Arizona. The fact is that we would not be having this happy situation
of a possible tax decrease if it were not for the fact that an historic
balanced budget was adopted by the Republican-led Congress which has
led to reduced costs for mortgage interest for the home, reduced costs
for car expense loans, and reduced costs for education expenses. That
has helped to spur the economy, have helped to increase employment,
more people having jobs. The whole economy, we have seen it in the
stock market, we have seen it in Wall Street, and we have seen it on
Main Street, and that has led to the opportunity for what I believe
should be a bipartisan tax decrease and a Social Security system that
will be strengthened because of the passage of this bill.
We thank those of our colleagues who are on the Committee on Ways and
Means for their leadership in starting the committee process.
I yield back to the gentleman from Arizona.
Mr. HAYWORTH. Mr. Speaker, it is just a common sense notion. Money
does not belong to Uncle Sam, it belongs to the hard-working people of
the United States, and those hard-working people ought to hang on to
more of it and send less of it here to Washington.
The gentleman from Illinois.
Mr. WELLER. Mr. Speaker, I thank the gentleman from Arizona for
yielding.
I think one good point to make, I was of course walking down the
street in Joliette the other day and the President had just given a
little talk, and, of course, he said we should not ``squander'' was his
term the surplus on anything except his priorities. What I found
interesting is that the President ignores that we are setting $1.4
trillion, or $1 trillion, 400 billion in surplus tax revenue to set
aside to save Social Security, and, of course, the remaining 10 percent
we give back to the American people.
What the President for some reason does not want us to know is that
I, growing up on the farm, as my friend from Arizona, I say, judge
someone not by what they say, but by what they do. The President says
we cannot squander surplus tax revenues on a tax cut for families
because we have other things we want to use it for.
The President opposes what is a pretty modest tax cut, a $16 billion
tax cut next year, but he turns right around and proposes spending $20
billion of the surplus tax revenues on defense spending and on the
State Department and other things that he feels are important.
So he does not want to give back to the taxpayer that extra tax
revenue; he wants to spend it. And that is why it is so important that
the 90-10 plan be enacted. Because what is exciting I think really for
the folks back home is the 90-10 plan, by setting aside 90 percent of
the budget, the surplus, extra tax revenue for saving Social Security
and giving the other 10 percent back in tax relief is we prevent those
politicians who ran up the massive deficits over the last 28 years from
spending it. I think that is a big victory.
I also would like to point out another provision in this tax bill. I
think that it is also very important, one of those we do not hear about
as much. All of us here, the 4 of us here are strong supporters of
welfare reform, and whether one is liberal or conservative on welfare
reform, I think we all agree that we want to have jobs there for those
who are on welfare so that they can raise themselves up and become an
active part of the community and a taxpayer and join the work rolls and
get off of the welfare rolls. One of the key provisions that is in this
legislation is we continue, and we extend, a streamlined work
opportunity tax credit, a tax incentive for the private sector to give
those who are on welfare an opportunity for a job. That is a big
victory, I believe.
I think of the area in the south side of Chicago and in the south
suburbs, where many communities are impoverished, older industrial
communities, and there are those, even though the economy has been
pretty good, who are still on welfare, who would like to have a job,
and because of the work opportunity tax credit, we have now seen
thousands of Illinois welfare recipients having the opportunity to go
to work. In fact, I can think of about 6 companies that have provided
almost 3,300
[[Page H9269]]
jobs in the Chicago area to former welfare recipients, giving them the
opportunity to lift themselves up and go to work. That is a big
victory.
That is why this tax package is so important. The President and his
friends would like to spend the surplus on the State Department and
military missions in Europe and so-called other spending priorities
that the President has, but that is $20 billion next year he would like
to spend of the surplus. We are saying, now, wait a second. What we
spend here should go through the regular appropriations process, should
be under the budget rules and be part of the budget. Instead, that
extra tax revenue we should give back and use it to save Social
Security.
That is what is exciting about the 90-10 plan. Under that plan we
help save Social Security by setting aside $1.4 trillion, $1 trillion,
400 billion in extra tax revenue that goes to save social security, and
the rest we give back. Eliminating the marriage tax penalty for the
majority of those who have suffered, helping family farmers in
Illinois, helping small businesses in Illinois, helping schools in
Illinois, helping those on welfare in Illinois go to work, and helping
those who want to send their kids to college in Illinois. That is a big
victory for the kids back home.
That is why I think it is so important that we continue to work for
bipartisan support. We need to convince the President that it is the
right thing to do. We want to eliminate the marriage tax penalty and we
want to eliminate those other unfair provisions in the Tax Code. We
want to save Social Security and eliminate the marriage tax penalty. It
should be a bipartisan effort. My hope is that the President will join
with us.
One message I have heard time and time again back home, and that is
that the seniors always say, let us keep the politics out of Social
Security. Republicans and Democrats should work together to save Social
Security and they should also work together to eliminate the marriage
tax penalty as well.
I yield back to the gentleman from Arizona.
Mr. HAYWORTH. Mr. Speaker, I thank my colleague and would just
reiterate his comments on welfare and welfare-to-work and what this tax
bill does in providing those opportunities to extend the work
opportunity tax credit and the welfare-to-work tax credit. It is so
vital, because indeed, there has been a disconnection in this city with
the rest of America, because this city has, and those in the Federal
Government and the bureaucracy, have measured compassion by the number
of people added to the welfare rolls. We say true compassion, Mr.
Speaker, is exactly the opposite. True compassion is moving people off
welfare and on to work.
Almost 4 million Americans have left the welfare rolls and are now
gainfully employed. That is true compassion. Those are true results.
And they go a long way, and this tax package will help further that
endeavor.
The gentleman from Missouri.
Mr. HULSHOF. Mr. Speaker, I appreciate the gentleman yielding. I know
our time is drawing short.
In addition to one of the provisions in the bill that does not get a
lot of air play, if you will, is the credit that we provide companies
in this country to invest in research. Mr. Speaker, my friend from
Arizona knows that technology is the key for America remaining on the
cutting edge of being a world leader. In the past we have provided
certain credits, tax credits for businesses who try those new ideas,
who put into practice, as they ordinarily would, those innovative plans
off the drawing board that they try to put into action. And that tax
credit of course has expired, but now we include that tax credit, that
research and development treatment so that companies and businesses,
not just the big ones, but the mom and pops that think they can build a
better mousetrap, that they can also have access by bringing those
plans off the drawing board to make sure that we remain the most
competitive among other nations across the planet, and it is something
that does not get again very much discussion, but something I think
that is very critical and crucial that is included in this tax plan.
Mr. Speaker, as a final point I would say to my friend and allow the
gentleman to conclude, my colleagues here this evening, most of them
were elected I think in the elections of 1994. As a new Member, someone
who is just about to conclude his first term, there seems to be a
universal attraction here in Washington between a pot of unspent money
and a Washington politician. If we do not set aside this surplus money
to save Social Security as we are doing, 90 cents out of every dollar,
putting that aside, and then allowing 10 cents out of a dollar
remaining in the pockets of the taxpayers who earned it, if we do not
take the measures now, those affirmative actions now to shield off
those surplus funds, it will be spent. It will be spent on big
government, it will be spent on Washington.
So I very much applaud and support our efforts last week of taking 90
percent of projected surpluses, strengthening Social Security, shoring
it up for the future. Again, not just for today's seniors, but for
future generations of seniors, while at the same time of putting that
90 percent towards Social Security, and allowing 10 percent to remain
in the pockets of the taxpayers who send it here to Washington. They
deserve no less than that.
I appreciate the gentleman for allowing me to spend some time with
him this evening.
Mr. HAYWORTH. Mr. Speaker, I thank my colleague from Missouri, also
my colleagues from Illinois, Pennsylvania and South Dakota, for coming
to the floor of the people's House to discuss the people's solution,
grounded on 2 realities, Mr. Speaker. Number 1, our firm conviction
that the money in the pockets of American citizens belongs to those
citizens. Not to Uncle Sam, not to the Washington bureaucrats, not to a
burgeoning Federal Government, which has grown leviathan through the
years, but instead to the people of the United States who deserve to
hang on to more of their hard-earned money and send less of it to
Washington.
The second notion is this firm conviction, that to fulfill the social
contract, time-honored over years in this century, we believe it is
vital of the surplus we are projecting to set aside 90 percent of that
surplus, $1 trillion, 400 billion to save Social Security. In stark
contrast to our liberal friends who, during 40 years time in the
majority, never quite found the time or the inclination to set aside 1
penny. We believe we owe it to today's seniors and future generations
to save $1 trillion, 400 billion which will be devoted exclusively to
saving Social Security.
Mr. Speaker, I suppose it really comes down to the policies of hope
and prosperity versus the politics of fear and class-envy. Indeed, one
year ago the President of the United States journeyed out of the
District of Columbia across the river to the Commonwealth of Virginia
where on a Sunday before a statewide election he proceeded to lecture
the people of Virginia, essentially telling them that if they wanted
their car tax reduced, they were being selfish. For all his alleged
political acumen, sadly, the President was mistaken and his advise to
Virginia voters last year was overwhelmingly rejected with the election
of Governor Gillmor who has worked to reduce that unfair car tax.
Now, for all 50 States and the District of Columbia, we reaffirm this
basic notion. That money should remain in the pockets of hard-working
Americans, not as some cynical stunt as those on the left would have us
believe, but because it is the right thing to do.
{time} 2215
This 90/10 plan provides, again, another modest attempt to ensure
that Americans hold onto more of their money, thereby strengthening the
institution of marriage, thereby strengthening the family, thereby
strengthening local control of issues such as education, thereby
strengthening seniors, who have seen the handcuffs taken off of the
earnings limits; in short, to offer something to all working Americans,
because, after all, Mr. Speaker, it is their money.
Mr. Speaker, in closing, I would address, through the Chair, the
other body and those in the executive branch of government to join with
us; to remain committed to the notion of a smaller, more effective
Federal Government; to stay true to the notion of
[[Page H9270]]
Americans holding onto more of their hard-earned money.
We would ask that, in a bipartisan way, even with the reality of a
pending election in a little more than one month's time, that we join
together. For if we do not, Mr. Speaker, again, what we have done is
offered a clear choice to the American people: Do they want to stand up
for a plan that recognizes that we should save social security by
setting aside $1,400,000,000,000, and at the same time offering tax
relief, reaffirming the promise of our individual freedoms and
individual endeavors, and the fact that it is our money? Or do we want
to return to the tired, old ways of the Washington bureaucracy, and the
notion that Washington, D.C. knows best?
Mr. Speaker, the choice is crystal clear. But even now, while we
rejoice in difference, we would ask people to cooperate, because after
all, the American people have the most to gain.
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