[Congressional Record Volume 146, Number 47 (Thursday, April 13, 2000)]
[Senate]
[Pages S2663-S2664]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
TAXES
Mr. CONRAD. Mr. President, as I listened to my colleague, I thought
some things said required a response.
As we look back at how we achieved balance in our budget and how we
turned massive deficits into massive surpluses, let me explain how it
was done. This chart covers 1980 through 1999. The blue line is the
outlays or expenditures of the Federal Government; the red line is the
revenue line. We had massive deficits when we were following the
Republican economic prescription for the country, which was trickle-
down economics, because the outlays far exceeded revenues. The result
was massive deficits and massive growth of the debt.
In 1993, we got a new administration and a new economic plan. We
passed a proposal without a single vote from the other side that
reduced spending as a percentage of our national economy and raised
revenue. That is how we balanced the budget. That is how we stopped the
raid on Social Security. That is how we stopped the economic decline
the country was experiencing under their plan, under their proposal.
In fact, at the time we passed the new budget plan in 1993, which was
a 5-year plan reducing the deficits each and every year as we brought
spending down, we brought revenues up until the two lines crossed and
we moved into surplus. Our friends on the other side of the aisle said
it was a huge mistake. They said it would increase the deficit. They
said it would increase unemployment. They said it would increase
inflation. They were wrong on every count. They were not just a little
bit wrong, they were completely wrong.
Now they come with a new economic prescription to go back to the bad
old days--back to debt, back to deficits, back to decline. Are we going
to take that path? Haven't we learned anything about what works?
Haven't we learned the best course is one of fiscal discipline? Haven't
we learned the best course is to stay on this plan that has turned
massive deficits into massive surpluses, that has led to the longest
[[Page S2664]]
economic expansion in our country, that has led to the lowest
unemployment in more than 30 years, the lowest inflation in more than
30 years? Are we going to jeopardize this with a risky tax scheme that
our friends on the other side propose?
My friend from Iowa says we have the highest tax rates ever. No, we
don't have the highest taxes ever. This chart shows the revenue line,
and indeed it came up; that is absolutely correct. It was that
combination of reduced spending and increased revenue that led to this
result. However, that does not translate into higher tax rates on the
American people. A key reason we have higher revenues is because we got
the economy moving again. This extraordinary economic expansion--again,
the longest economic expansion in our history--has generated more
revenue. That is what helped balance the budget, coupled with reduced
spending.
The question of what has happened to individual taxes is quite a
different story. This was a story on the front page of the Washington
Post: ``Federal Tax Level Falls for Most. Studies Show Burden Now Less
Than 10 Percent.''
The story tells the truth.
For all but the wealthiest Americans, the Federal income
tax burden has shrunk to the lowest level in four decades.
We don't have the highest taxes on individual American taxpayers that
we have ever had, as the Senator from Iowa asserted. That is just not
the case.
For all but the wealthiest Americans, the Federal income
tax burden has shrunk to the lowest level in four decades.
That is the truth according to a series of studies by both liberal
and conservative tax experts. Each of the studies shows the bottom line
is the same. Most Americans this year will have to fork over less than
10 percent of their income to the Federal Government. The Congressional
Budget Office estimates the middle fifth of American families with an
average income of $39,000 paid 5.4 percent income tax in 1999, compared
with 8.3 percent in 1981. Their taxes have gone down. That is the
middle-income people in America.
The Treasury Department estimates that a four-person family, with a
median income of $54,900, paid 7.46 percent of that in income tax, the
lowest since 1965. And the median two-earner family making $68,000 paid
8.8 percent in 1998, about the same as 1955.
If we are going to have a debate, let's have a debate on facts and
not make up things.
The fundamental problem with the legislation offered by our
colleagues: They have more of a tax cut than there is non-Social
Security surplus available for a tax cut. It is a question of
priorities. What do we want to do with the surpluses available?
Remember, these are projected surpluses. We can take the money and use
it all for a tax cut that disproportionately goes to the wealthiest.
That is what the Republicans want to do.
Our side believes we ought to reserve every penny of the Social
Security surplus for Social Security. Republicans agree with that. On
the non-Social Security surplus, the Republicans want to use it all for
a tax cut that disproportionately goes to the wealthiest; 60 percent
goes to the wealthiest 10 percent.
Our side thinks the highest priority should be further paying down of
the debt because that is what every economist has said is in the
highest interests of this country. This is what will most assure our
economic future.
Second, we believe we ought to provide for tax relief; 29 percent of
the non-Social Security surplus under our proposal goes for tax relief.
Part of that goes to address the marriage tax penalty. However, we are
addressing those who suffer the marriage tax penalty.
Our friends on the other side want to give a big tax cut to folks who
do not have the marriage tax penalty. In fact, for people receiving the
marriage bonus--they pay lower taxes as a result of being married than
if they were filing individually--they want to give them a tax cut,
too.
When they say we are limited to 10 amendments on our side, the
underlying legislation deals with many more issues than just the
marriage tax penalty. They want to restrict our right to offer
alternatives. That is not fair. That is not the way the Senate was
designed to operate. Not surprisingly, we don't intend to go along with
that. That is not the way the Senate is designed to work.
We offered legislation in the Senate Finance Committee to give people
a choice. They file as married couples; they file as individuals; file
the way that helps the most, that gives families the least tax
liability. That is what Democrats are proposing. We do it in a way to
not use all of the non-Social Security surplus for a tax cut that goes
predominantly to the wealthiest. Instead, we put the highest priority
on reducing the debt; the second highest priority on tax relief; the
third highest priority on using money for high priority domestic needs
such as defense, education, and agriculture, which are in very deep
trouble.
Mrs. HUTCHISON. Mr. President, are the 10 minutes Senator Conrad has
remaining from the Democratic side?
The PRESIDING OFFICER (Mr. Roberts). That is correct, from the
Democratic side. There are 20 minutes remaining on the Republican side.
Mrs. HUTCHISON. I thank the Chair.
THE PRESIDING OFFICER. The Senator from North Dakota is recognized.
MR. CONRAD. I thank the Chair.
(The remarks of Mr. Conrad pertaining to the introduction of S. 2422
are located in today's Record under ``Statements on Introduced Bills
and Joint Resolutions.'')
Mr. GRASSLEY. Mr. President, I yield 5 minutes to the Senator from
Missouri.
The PRESIDING OFFICER. The distinguished Senator from Missouri is
recognized for 5 minutes.
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