[Congressional Record Volume 144, Number 142 (Saturday, October 10, 1998)]
[Senate]
[Pages S12279-S12281]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    PRINCIPLE, COURAGE, AND TAX CUTS

  Mr. GRAMS. Mr. President, I want to take the remaining part of my 
time this morning to talk about a subject I have worked on for the 6 
years I have been in Congress, and that is trying to raise the 
awareness of the issue of taxes in this country, that we are now taxed 
at an all-time high, and that Americans need and deserve some form of 
tax relief.
  So, Mr. President, I wanted to take time to rise today to express my 
disappointment over the Senate's failure to fulfill its obligations to 
the taxpayers to consider and to pass any kind of tax relief bill this 
year.
  Fiscally, socially, morally, this is a tremendous mistake, and I 
believe my colleagues are wrong. I am equally disappointed at President 
Clinton's threats to veto this important legislation had it passed. It 
is the same case as last year when, in the State of Virginia, when 
then-candidate for Governor Gilmore was pledging a tax cut of his own. 
The President said at that time that Virginians would be ``selfish'' to 
vote for tax relief. This year he says ``to squander money on a tax 
cut''--again, that is how President

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Clinton is describing our attempt this year to let working Americans 
keep more of their money--``to squander money on a tax cut.''
  Unfortunately, there is a pattern here, and apparently neither 
President Clinton nor the rest of Washington has changed their mind. 
Both want as much money as they can get from the taxpayers, so they can 
spend it the way they think is best.
  According to Webster's Dictionary, the definition of ``squander'' is 
``to spend extravagantly or foolishly.'' I say to President Clinton 
that I am shocked that you actually believe taxpayers squander their 
salaries in this way and that only Washington can spend the money 
wisely. With such highly placed disregard for the fiscal abilities of 
the American people, I believe it is no wonder that Washington has been 
unwilling to give the taxpayers more control over their own dollars.
  Let me focus first this morning, Mr. President, on the budget 
surplus. In a recent series of high-profile celebrations, folks here in 
Washington could hardly wait to rush to the cameras to claim credit for 
the $70 billion budget surplus, watching them slap their own backs with 
their hands. Politicians have been humming happy ditties all around 
this town while approving big-ticket spending items right and left. 
Meanwhile, those same politicians pontificate about preserving the 
surplus to ``save Social Security first.''
  The truth is, the White House didn't generate this surplus, nor did 
the U.S. House or the Senate. The politicians have no rightful claim to 
the surplus. Washington should not be allowed to sit around and dream 
up ways to spend even more money because a surplus has arrived. Working 
Americans are responsible for propelling our economy forward and 
generating this budget surplus, and they deserve to get it back as tax 
relief. There should be no debate. Taxpayers have overpaid, and, like 
any other time a person overpays for anything, they ought to get it 
back. If you go into a store and pay too much for an item, you expect 
to get the change back. But somehow in Washington, if you overpay, that 
is just too bad, Washington wants to pocket your money.
  The surplus is the product of the recent revenue surge--a surge, I 
believe, generated directly by increased productivity and increased 
individual income tax payments, including the payment of capital gains 
taxes as investors took advantage of the lower capital gains rate--
again, proving that reducing the tax rates can actually increase 
revenues, because the economy will grow. Very little of the surplus 
comes from policy changes, however, related to deficit reduction.
  On the other hand, there are others in this Chamber who claim there 
is no surplus, that if we subtract the dollars Washington has routinely 
raided from the Social Security trust fund, the Government is still in 
the red. Therefore, they oppose using the unified budget surplus for 
any kind of tax relief.
  Mr. President, they are right on the facts, but I believe they are 
dead wrong about the conclusion. Washington's big spenders are the ones 
who have exhausted every penny of the Social Security surplus. They 
have already exhausted every penny of the Social Security surplus on 
other Government programs. They have wish lists. The taxpayers 
shouldn't be denied relief from a stifling tax burden just because 
Washington has managed to juggle the Nation's bank accounts.
  I urge my colleagues to review the CBO's ``August Economic and Budget 
Outlook,'' which shows precisely where revenues will come from in the 
next 10 years. The data shows that the greatest share of the projected 
budget surplus comes directly from income taxes paid by the taxpayers, 
not the FICA taxes. In 1998, individual income, corporate, and estate 
taxes make up nearly 80 percent of total tax revenue growth, while the 
share of FICA tax is about 20 percent. General tax revenues are 
expected to grow by $723 billion, or 60 percent, over the next 10 
years.
  What I am saying, Mr. President, is that the taxpayers generated the 
surplus, outside the money earmarked for Social Security, and the 
Government has no right to absorb it. It is only moral and fair to 
return at least a part of it to the taxpayers.
  If we don't return at least a portion of the surplus to the 
taxpayers, and do it soon, Washington is going to spend it, leaving 
nothing then for tax relief for the vitally important task of actually 
trying to preserve and save Social Security. Such spending will only 
enlarge the Government, and if the Government is enlarged today, it 
will make it even more expensive to support it in the future.
  Mr. President, the situation we find ourselves in today reflects two 
very fundamentally different principles of government: Are we going to 
embrace tax cuts for working Americans, or are we going to embrace more 
spending for social engineering?
  I am proud to serve here as a member of the Republican Party--a party 
which, since its creation, has firmly held that a person owns himself, 
a person owns his labor, and a person owns the fruits of his labor. We 
believe the pursuit of individual and States rights and a restricted 
role for the Federal Government create economic growth and prosperity.
  The two parties have traditionally offered a marked choice--a choice 
between the Democratic Party belief that people should work for the 
Government or our vision of a Government that works for the people. One 
party believes that it has a right to spend every penny that it can 
take from working Americans--again echoing the President's words that 
people are ``selfish'' to want to cut taxes or to ``squander money on a 
tax cut.''
  The Republican Party, on the other hand, believes Government should 
be limited only to that amount needed for necessary services, and this 
is, indeed, a choice between two futures: a choice between small 
Government or big Government, a choice between fiscal discipline or 
irresponsibility, a choice between individual freedom or servitude to a 
bigger Government, responsibility or dependency, long-term economic 
prosperity for the Nation or some short-term benefits for the special 
interest groups and the politicians who feed them.
  Mr. President, that is exactly why the American taxpayers ushered in 
an era of Republican congressional leadership in 1994, a new majority 
that pledged to provide fiscal discipline, individual freedom, personal 
responsibility, and prosperity for all people.
  Unfortunately, Congress has so far delivered on only a small portion 
of that pledge, blocked by the competing forces of tax-and-spend versus 
tax relief and personal empowerment. The choice I spoke of a moment ago 
has become blurred as both parties fight in a misguided effort to 
purchase some measure of the people's trust.
  They think you can run out and with their own money buy the trust of 
the American people. But in doing so, Congress has allowed annual 
Federal spending to increase from $1.5 trillion in 1994 to $1.73 
trillion today. In fact, Federal spending has never been higher. During 
the same period, the national debt has grown from $4.9 trillion to $5.7 
trillion, an $810 billion increase in our national debt.
  Mr. President, take a look at the current debate over the 
supplemental spending to be included in the omnibus appropriations 
bill. A week ago, we were hearing encouraging words that much of this 
would be offset by cuts in other programs. Now, as we careen toward 
adjournment, it appears there will be as much as $20 billion in 
emergency spending--out of the surplus, of course--and the report this 
morning is that there could be even more as we work and maybe have to 
give in to the administration demands for more money to be spent in 
order to avoid a Government shutdown.
  Mr. President, despite a $70 billion budget surplus, total taxation 
is at an all-time high. The tax relief Congress enacted last year does 
not go nearly far enough. I am proud we had the courage to enact the 
$500 per-child tax credit, which I authored in 1993, but when our tax 
bill overall returns to the taxpayers only one cent for every dollar 
they send to Washington--especially now, during a time of surpluses--I 
believe we have failed them miserably.

  Working Americans see their earnings taxed, and then re-taxed 
repeatedly. Washington taxes their income when they first earn it. It 
is then subject to excise taxes when they spend it. And their savings 
and investments are also taxed. And when they die, the Government is 
the first to put their hands into the estate.

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  Farmers and small business owners cannot easily pass their businesses 
on to their families because the huge estate and gift taxes still 
exist. The government imposes a 43 percent tax on all American couples 
simply because they are married. Even seniors--retired people in our 
country, our senior citizens--they have their earned benefits taxed.
  If the 105th Congress was supposed to be about cutting taxes and 
forever reforming the tax system--and I believe that was our mandate--
the 105th Congress did not complete the job.
  Our progress has fizzled not because our efforts have lost the 
support of the people--in fact, two thirds of the American people 
supported tax relief during the 1996 elections, and broad tax relief 
still enjoys overwhelming support today--but because some in Congress 
have lost their backbones. They have lost the courage to make a stand 
on principle and not abandon their moral compass at the first sign of 
resistance.
  In too many instances, this Congress has become a willing 
collaborator of President Clinton's tax-and-spend policies. We have 
helped to build a bigger, more expensive government, and in doing so 
have abandoned our promise of tax relief for working Americans.
  Mr. President, each time Congress makes a promise to the taxpayers--
and then deserts them--Congress comforts itself by saying it would come 
back next year and enact an even larger tax cut. This is self-deceiving 
at best.
  If we do not take a stand today, what is going to happen to make us 
more courageous a year from now? Besides, each year we wait, the 
Government takes an ever-greater bite of the earnings of working 
Americans and the Government gets bigger and becomes harder to trim in 
the future.
  Another point I would like to make, Mr. President, is that a tax cut 
is not spending. Only in convoluted bookkeeping practices of Washington 
would we consider a cut in tax rates to be spending. The reason is 
simple: first, it is the taxpayers' money that supports and keeps the 
Government running; second, tax relief not only ensures a healthy and 
strong economy, but also generates more revenues for the Government.
  In a recent study, economists at the Institute for Policy Innovation 
concluded that the House-passed tax relief bill of $80 billion--an 
unforgivably moderate tax relief measure, in my view--would add an 
additional $300 billion to our GDP and create more than 135,000 jobs. 
This economic growth would in turn generate about $80 billion in 
additional revenues to the Federal Government.
  Mr. President, when it comes to federal spending, Washington rarely 
asks how the American taxpayers can afford to give up more of their 
income to the government, and how such excessive spending will affect a 
working family's budget and finances. Equally upsetting is the fact 
that when it comes to tax relief, Washington is always reluctant to 
act.
  Oh, they say it is easy to give an election year tax cut. That is 
impossible around here. It is hard to get a tax cut. It is easy to 
spend; it is very hard to give tax relief. Congress even goes so far as 
to compel tax cut advocates to pay for any tax relief via Washington's 
PAYGO rule. That is a rule that requires increasing taxes on some or 
lowering entitlement benefits in order to cut tax relief to others. 
Nothing is more ridiculous than the requirement of the PAYGO rule. We 
must repeal it so we can do the job of shrinking the size of the 
Government and let working families keep more of the money, the money 
they earn in order to spend it on their priorities--not Washington 
priorities.
  One major reason for the failure of this year's tax relief bill is 
that Washington's spin doctors took full advantage of Americans' 
anxiety about Social Security. ``Save Social Security first'' is just 
another Washington lie. Mark my word, Mr. President, Social Security 
crisis or not, Washington has spent, and will continue to spend, 
surplus dollars whenever it can for its pet programs.
  Since 1983, Washington has raided more than $700 billion from the 
trust funds for non-Social Security programs, and Congress approved 
that spending every time. In the next 5 years, the Federal Government 
will raid another $600 billion from the Social Security trust funds. 
Those politicians who insist on using the surplus for Social Security 
have voted for most, if not all, of those spending bills, and so it is 
those politicians who in the last 15 years have stripped the trust 
funds of any surplus.
  Mr. President, despite the rhetoric about saving Social Security, few 
have come up with a concrete plan to save it. The problem is that by 
law, the Social Security surplus has to be put into Treasury 
securities. That means Washington can legally use the money to fund its 
favorite non-Social Security programs, rendering these ``assets'' 
little more than Treasury IOUs. Unless we change the law, Washington 
will continue to abuse Social Security until it goes broke.
  I agree that reforming Social Security to ensure its solvency is 
vitally important. Any projected budget surplus should be used partly 
for that purpose. In fact, I have introduced a bill to just do that. 
Yet, I believe strongly that the surplus alone will not save Social 
Security and therefore fundamental reform is needed to change it from a 
pay-as-you-go system to a fully funded one.
  Mr. President, the States offer us an excellent model of how we 
should use the budget surplus. In recent years, many Governors have cut 
taxes and shrunk the size of their governments, and in the process have 
turned budget deficits into surpluses. They are now using those 
surpluses to provide even further tax relief. Some States, such as 
Missouri and Florida, even have constitutional or statutory 
requirements to return to taxpayers any revenues that exceed income 
growth.
  The States have proved that if government performs only legitimate 
and necessary functions, and does so without waste, it can leave much 
more money in the pockets of the people. And it is the people who can 
best spend their money, whether it is for their children's health care, 
saving for a college education, giving more to their church and 
charities, or just helping to set something aside for their retirement.
  Now, Mr. President, back to the question of the budget surplus and 
who should spend this money--the Government or the workers who earned 
it?
  In conclusion, Washington's tax and spending policies have 
systematically ignored our children's future and severely undermined 
the basic functions of the family. We must abandon those policies and 
help restore the family to an economic position capable of fulfilling 
its vital responsibilities. In answer to my own question, we must 
provide American families with meaningful tax relief, allowing them to 
keep more of their hard-earned money.
  It is their money. Let us give it back.
  Thank you very much, Mr. President. I yield the floor.
  Mr. ENZI addressed the Chair.
  The PRESIDING OFFICER. The distinguished Senator from Wyoming is 
recognized.

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