[Congressional Record Volume 145, Number 112 (Tuesday, August 3, 1999)]
[House]
[Pages H6847-H6848]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           TWO OF THE MANY PROBLEMS WITH THE PROPOSED TAX CUT

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 19, 1999, the gentleman from Massachusetts (Mr. Olver) is 
recognized during morning hour debates for 5 minutes.
  Mr. OLVER. Mr. Speaker, for this week the high profile, main business 
of the Republican leadership in Congress is to reach a final version of 
the $800 billion tax cut that has been proposed.
  Now, the Republican leadership says that their tax cut is for the 
middle class, but that is clearly not true.
  The House-passed version of the bill passed here, passed this branch 
2 weeks ago, and in that version the 6 million highest income 
taxpayers, which represent about 5 percent of all taxpayers in this 
country, with incomes of over $125,000 a year, would get 61 percent, 
more than three-fifths of the total tax reduction, while the other 120 
million taxpayers in this country, 95 percent of all the taxpayers, 
they would get only 39 percent of the total tax reduction that is 
involved.
  Now, I do not think that many people would consider that a middle 
class tax cut. In fact, it is designed to make the already rich a very 
great deal richer, while the broad middle class of people in this 
country, the families that are living on an income of between $20,000 
to, say, $80,000 a year, are only going to see a tax cut that is worth 
one or two cups of coffee a day for those families.
  But that is only a small part of the story. The rest of the story is 
what cannot be done if the Republican leadership's tax cut bill were to 
become law. For that, I would like to just indicate a couple of areas 
of what cannot be done. Look at and consider the question of the 
national debt. On this chart, this chart shows what the publicly-held 
national debt of $3.7 trillion is made up of.
  These pie chart sections, 38 presidents from 1789 until 1977 produced 
this blue piece. This is President Carter's portion of the debt. This 
is President Reagan's. This is President Bush's. This is President 
Clinton's. The interest on that $3.7 trillion of debt now is about as 
large, it is about $230 billion a year, is about as large as the whole 
debt that was created during the Carter administration, that was built 
up during the Carter administration.
  What happens? The tax cut makes certain that we will not be able to 
pay off that debt, and we will have to continue paying $200 billion or 
more per year for years into the future. That means higher interest 
rates for every American family that wants to buy a home, higher 
interest rates for every business person who wants to create a business 
that is going to provide more jobs.
  So, the debt problem.
  Let me take a different issue. If you take a look at the Social 
Security situation, the tax cut, if it were to become law in its 
present form, would make it very much more difficult to extend the 
Social Security system beyond the year 2030. We know the demographics. 
We know how many people are going to be retiring between now and then. 
We know how many are going to enter the workforce between now and then, 
and we know that the reserve funds in the Social Security system will 
run out in 2030. And we will only be able to operate on the basis of 
whatever is paid into the Social Security trust fund year by year, 
which means the benefits for the ever-growing number of senior citizens 
will have to be reduced or the retirement age for people will have to 
go up.
  At the same time, at the same time, we know that for those people who 
are businesspeople who are wealthy Americans, the retirement age is 
going down. People are retiring, if they are wealthy enough, at 50, 55, 
some even younger than that. Some of them never have worked so they 
never have to retire.
  So the Social Security system is in serious jeopardy of not having 
any additional revenue to put into the protection and preservation of 
the Social Security system.
  Now, my mother, who is 92 years old, is living now on Social Security 
that is under $500 per month. She also has a couple hundred dollars of 
income from

[[Page H6848]]

other sources but she certainly could not live on a reduced benefit as 
would happen if this tax cut were to become law.
  So those are two reasons. There are many others but those are two of 
what the problems are with the tax cut that is being proposed.

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