[Congressional Record Volume 146, Number 71 (Friday, June 9, 2000)]
[House]
[Pages H4128-H4164]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page H4128]]
                   DEATH TAX ELIMINATION ACT OF 2000

  Mr. ARCHER. Mr. Speaker, pursuant to House Resolution 519, I call up 
the bill (H.R. 8) to amend the Internal Revenue Code of 1986, to phase 
out the estate and gift taxes over a 10-year period, and ask for its 
immediate consideration.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. Kolbe). Pursuant to House Resolution 
519, the bill is considered read for amendment.
  The text of H.R. 8 is as follows:

                                 H.R. 8

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Death Tax Elimination Act''.

     SEC. 2. PHASEOUT OF ESTATE AND GIFT TAXES.

       (a) Repeal of Estate and Gift Taxes.--Subtitle B of the 
     Internal Revenue Code of 1986 (relating to estate and gift 
     taxes) is repealed effective with respect to estates of 
     decedents dying, and gifts made, after December 31, 2009.
       (b) Phaseout of Tax.--Subsection (c) of section 2001 of 
     such Code (relating to imposition and rate of tax) is amended 
     by adding at the end the following new paragraph:
       ``(3) Phaseout of tax.--In the case of estates of decedents 
     dying, and gifts made, during any calendar year after 1999 
     and before 2010--
       ``(A) In general.--The tentative tax under this subsection 
     shall be determined by using a table prescribed by the 
     Secretary (in lieu of using the table contained in paragraph 
     (1)) which is the same as such table; except that--
       ``(i) each of the rates of tax shall be reduced (but not 
     below zero) by the number of percentage points determined 
     under subparagraph (B), and
       ``(ii) the amounts setting forth the tax shall be adjusted 
     to the extent necessary to reflect the adjustments under 
     clause (i).
       ``(B) Percentage points of reduction.--

                                                          The number of
``For calendar year:                              percentage points is:
  2000...........................................................5 ....

  2001..........................................................10 ....

  2002..........................................................15 ....

  2003..........................................................20 ....

  2004..........................................................25 ....

  2005..........................................................30 ....

  2006..........................................................35 ....

  2007..........................................................40 ....

  2008..........................................................45 ....

  2009..........................................................50.....

       ``(C) Coordination with paragraph (2).--Paragraph (2) shall 
     be applied by reducing the 55 percent percentage contained 
     therein by the number of percentage points determined for 
     such calendar year under subparagraph (B).
       ``(D) Coordination with credit for state death taxes.--
     Rules similar to the rules of subparagraph (A) shall apply to 
     the table contained in section 2011(b) except that the number 
     of percentage points referred to in subparagraph (A)(i) shall 
     be determined under the following table:

                                                          The number of
``For calendar year:                              percentage points is:
  2000......................................................1\1/2\ ....

  2001...........................................................3 ....

  2002......................................................4\1/2\ ....

  2003...........................................................6 ....

  2004......................................................7\1/2\ ....

  2005...........................................................9 ....

  2006.....................................................10\1/2\ ....

  2007..........................................................12 ....

  2008.....................................................13\1/2\ ....

  2009........................................................15.''....

       (c) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying, and gifts made, 
     after December 31, 1999.

  The SPEAKER pro tempore. The amendment printed in the bill is 
adopted.
  The text of H.R. 8, as amended, is as follows:

                                 H.R. 8

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; ETC.

       (a) Short Title.--This Act may be cited as the ``Death Tax 
     Elimination Act of 2000''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of the Internal 
     Revenue Code of 1986.

TITLE I--REPEAL OF ESTATE, GIFT, AND GENERATION-SKIPPING TAXES; REPEAL 
                      OF STEP UP IN BASIS AT DEATH

     SEC. 101. REPEAL OF ESTATE, GIFT, AND GENERATION-SKIPPING 
                   TAXES.

       (a) In General.--Subtitle B is hereby repealed.
       (b) Effective Date.--The repeal made by subsection (a) 
     shall apply to the estates of decedents dying, and gifts and 
     generation-skipping transfers made, after December 31, 2009.

     SEC. 102. TERMINATION OF STEP UP IN BASIS AT DEATH.

       (a) Termination of Application of Section 1014.--Section 
     1014 (relating to basis of property acquired from a decedent) 
     is amended by adding at the end the following:
       ``(f ) Termination.--In the case of a decedent dying after 
     December 31, 2009, this section shall not apply to property 
     for which basis is provided by section 1022.''.
       (b) Conforming Amendment.--Subsection (a) of section 1016 
     (relating to adjustments to basis) is amended by striking 
     ``and'' at the end of paragraph (26), by striking the period 
     at the end of paragraph (27) and inserting ``, and'', and by 
     adding at the end the following:
       ``(28) to the extent provided in section 1022 (relating to 
     basis for certain property acquired from a decedent dying 
     after December 31, 2009).''.

     SEC. 103. CARRYOVER BASIS AT DEATH.

       (a) General Rule.--Part II of subchapter O of chapter 1 
     (relating to basis rules of general application) is amended 
     by inserting after section 1021 the following new section:

     ``SEC. 1022. CARRYOVER BASIS FOR CERTAIN PROPERTY ACQUIRED 
                   FROM A DECEDENT DYING AFTER DECEMBER 31, 2009.

       ``(a) Carryover Basis.--Except as otherwise provided in 
     this section, the basis of carryover basis property in the 
     hands of a person acquiring such property from a decedent 
     shall be determined under section 1015.
       ``(b) Carryover Basis Property Defined.--
       ``(1) In general.--For purposes of this section, the term 
     `carryover basis property' means any property--
       ``(A) which is acquired from or passed from a decedent who 
     died after December 31, 2009, and
       ``(B) which is not excluded pursuant to paragraph (2).
     The property taken into account under subparagraph (A) shall 
     be determined under section 1014(b) without regard to 
     subparagraph (A) of the last sentence of paragraph (9) 
     thereof.
       ``(2) Certain property not carryover basis property.--The 
     term `carryover basis property' does not include--
       ``(A) any item of gross income in respect of a decedent 
     described in section 691,
       ``(B) property of the decedent to the extent that the 
     aggregate adjusted fair market value of such property does 
     not exceed $1,300,000, and
       ``(C) property which was acquired from the decedent by the 
     surviving spouse of the decedent (and which would be 
     carryover basis property without regard to this subparagraph) 
     but only if the value of such property would have been 
     deductible from the value of the taxable estate of the 
     decedent under section 2056, as in effect on the day before 
     the date of the enactment of the Death Tax Elimination Act of 
     2000.
     For purposes of this subsection, the term `adjusted fair 
     market value' means, with respect to any property, fair 
     market value reduced by any indebtedness secured by such 
     property.
       ``(3) Limitation on exception for property acquired by 
     surviving spouse.--The adjusted fair market value of property 
     which is not carryover basis property by reason of paragraph 
     (2)(C) shall not exceed $3,000,000.
       ``(4) Allocation of excepted amounts.--The executor shall 
     allocate the limitations under paragraphs (2)(B) and (3).
       ``(5) Inflation adjustment of excepted amounts.--In the 
     case of decedents dying in a calendar year after 2010, the 
     dollar amounts in paragraphs (2)(B) and (3) shall each be 
     increased by an amount equal to the product of--
       ``(A) such dollar amount, and
       ``(B) the cost-of-living adjustment determined under 
     section 1(f)(3) for such calendar year, determined by 
     substituting `2009' for `1992' in subparagraph (B) thereof.
     If any increase determined under the preceding sentence is 
     not a multiple of $10,000, such increase shall be rounded to 
     the nearest multiple of $10,000.
       ``(c) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary to carry out the purposes of 
     this section.''.
       (b) Miscellaneous Amendments Related To Carryover Basis.--
       (1) Capital gain treatment for inherited art work or 
     similar property.--
       (A) In general.--Subparagraph (C) of section 1221(a)(3) 
     (defining capital asset) is amended by inserting ``(other 
     than by reason of section 1022)'' after ``is determined''.
       (B) Coordination with section 170.--Paragraph (1) of 
     section 170(e) (relating to certain contributions of ordinary 
     income and capital gain property) is amended by adding at the 
     end the following: ``For purposes of this paragraph, the 
     determination of whether property is a capital asset shall be 
     made without regard to the exception contained in section 
     1221(a)(3)(C) for basis determined under section 1022.''.
       (2) Definition of executor.--Section 7701(a) (relating to 
     definitions) is amended by adding at the end the following:
       ``(47) Executor.--The term `executor' means the executor or 
     administrator of the decedent, or, if there is no executor or 
     administrator appointed, qualified, and acting within the 
     United States, then any person in actual or constructive 
     possession of any property of the decedent.''.
       (3) Clerical amendment.--The table of sections for part II 
     of subchapter O of chapter 1 is amended by adding at the end 
     the following new item:

``Sec. 1022. Carryover basis for certain property acquired from a 
              decedent dying after December 31, 2009.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying after December 31, 
     2009.

[[Page H4129]]

   TITLE II--REDUCTIONS OF ESTATE AND GIFT TAX RATES PRIOR TO REPEAL

     SEC. 201. ADDITIONAL REDUCTIONS OF ESTATE AND GIFT TAX RATES.

       (a) Maximum Rate of Tax Reduced to 50 Percent.--
       (1) In general.--The table contained in section 2001(c)(1) 
     is amended by striking the two highest brackets and inserting 
     the following:

$1,025,800, plus 50% of the excess over $2,500,000.''..................

       (2) Phase-in of reduced rate.--Subsection (c) of section 
     2001 is amended by adding at the end the following new 
     paragraph:
       ``(3) Phase-in of reduced rate.--In the case of decedents 
     dying, and gifts made, during 2001, the last item in the 
     table contained in paragraph (1) shall be applied by 
     substituting `53%' for `50%'.''.
       (b) Repeal of Phaseout of Graduated Rates.--Subsection (c) 
     of section 2001 is amended by striking paragraph (2) and 
     redesignating paragraph (3), as added by subsection (a), as 
     paragraph (2).
       (c) Additional Reductions of Rates of Tax.--Subsection (c) 
     of section 2001, as so amended, is amended by adding at the 
     end the following new paragraph:
       ``(3) Phasedown of tax.--In the case of estates of 
     decedents dying, and gifts made, during any calendar year 
     after 2002 and before 2010--
       ``(A) In general.--Except as provided in subparagraph (C), 
     the tentative tax under this subsection shall be determined 
     by using a table prescribed by the Secretary (in lieu of 
     using the table contained in paragraph (1)) which is the same 
     as such table; except that--
       ``(i) each of the rates of tax shall be reduced by the 
     number of percentage points determined under subparagraph 
     (B), and
       ``(ii) the amounts setting forth the tax shall be adjusted 
     to the extent necessary to reflect the adjustments under 
     clause (i).
       ``(B) Percentage points of reduction.--

                                                        The number of  
    ``For calendar year:                          percentage points is:
      2003.........................................................1.0 
      2004.........................................................2.0 
      2005.........................................................3.0 
      2006.........................................................4.0 
      2007.........................................................5.5 
      2008.........................................................7.5 
      2009.........................................................9.5.

       ``(C) Coordination with income tax rates.--The reductions 
     under subparagraph (A)--
       ``(i) shall not reduce any rate under paragraph (1) below 
     the lowest rate in section 1(c), and
       ``(ii) shall not reduce the highest rate under paragraph 
     (1) below the highest rate in section 1(c).
       ``(D) Coordination with credit for state death taxes.--
     Rules similar to the rules of subparagraph (A) shall apply to 
     the table contained in section 2011(b) except that the 
     Secretary shall prescribe percentage point reductions which 
     maintain the proportionate relationship (as in effect before 
     any reduction under this paragraph) between the credit under 
     section 2011 and the tax rates under subsection (c).''.
       (d) Effective Dates.--
       (1) Subsections (a) and (b).--The amendments made by 
     subsections (a) and (b) shall apply to estates of decedents 
     dying, and gifts made, after December 31, 2000.
       (2) Subsection (c).--The amendment made by subsection (c) 
     shall apply to estates of decedents dying, and gifts made, 
     after December 31, 2002.

    TITLE III--UNIFIED CREDIT REPLACED WITH UNIFIED EXEMPTION AMOUNT

     SEC. 301. UNIFIED CREDIT AGAINST ESTATE AND GIFT TAXES 
                   REPLACED WITH UNIFIED EXEMPTION AMOUNT.

       (a) In General.--
       (1) Estate tax.--Subsection (b) of section 2001 (relating 
     to computation of tax) is amended to read as follows:
       ``(b) Computation of Tax.--
       ``(1) In general.--The tax imposed by this section shall be 
     the amount equal to the excess (if any) of--
       ``(A) the tentative tax determined under paragraph (2), 
     over
       ``(B) the aggregate amount of tax which would have been 
     payable under chapter 12 with respect to gifts made by the 
     decedent after December 31, 1976, if the provisions of 
     subsection (c) (as in effect at the decedent's death) had 
     been applicable at the time of such gifts.
       ``(2) Tentative tax.--For purposes of paragraph (1), the 
     tentative tax determined under this paragraph is a tax 
     computed under subsection (c) on the excess of--
       ``(A) the sum of--
       ``(i) the amount of the taxable estate, and
       ``(ii) the amount of the adjusted taxable gifts, over
       ``(B) the exemption amount for the calendar year in which 
     the decedent died.
       ``(3) Exemption amount.--For purposes of paragraph (2), the 
     term `exemption amount' means the amount determined in 
     accordance with the following table:

                                                       ``IThe exemption
                                                         caleamount is:
    2001......................................................$675,000 
    2002 and 2003.............................................$700,000 
    2004......................................................$850,000 
    2005......................................................$950,000 
    2006 or thereafter......................................$1,000,000.
       ``(4) Adjusted taxable gifts.--For purposes of paragraph 
     (2), the term `adjusted taxable gifts' means the total amount 
     of the taxable gifts (within the meaning of section 2503) 
     made by the decedent after December 31, 1976, other than 
     gifts which are includible in the gross estate of the 
     decedent.''
       (2) Gift tax.--Subsection (a) of section 2502 (relating to 
     computation of tax) is amended to read as follows:
       ``(a) Computation of Tax.--
       ``(1) In general.--The tax imposed by section 2501 for each 
     calendar year shall be the amount equal to the excess (if 
     any) of--
       ``(A) the tentative tax determined under paragraph (2), 
     over
       ``(B) the tax paid under this section for all prior 
     calendar periods.
       ``(2) Tentative tax.--For purposes of paragraph (1), the 
     tentative tax determined under this paragraph for a calendar 
     year is a tax computed under section 2001(c) on the excess 
     of--
       ``(A) the aggregate sum of the taxable gifts for such 
     calendar year and for each of the preceding calendar periods, 
     over
       ``(B) the exemption amount under section 2001(b)(3) for 
     such calendar year.''
       (b) Repeal of Unified Credits.--
       (1) Section 2010 (relating to unified credit against estate 
     tax) is hereby repealed.
       (2) Section 2505 (relating to unified credit against gift 
     tax) is hereby repealed.
       (c) Conforming Amendments.--
       (1)(A) Subsection (b) of section 2011 is amended--
       (i) by striking ``adjusted'' in the table, and
       (ii) by striking the last sentence.
       (B) Subsection (f ) of section 2011 is amended by striking 
     ``, reduced by the amount of the unified credit provided by 
     section 2010''.
       (2) Subsection (a) of section 2012 is amended by striking 
     ``and the unified credit provided by section 2010''.
       (3) Subparagraph (A) of section 2013(c)(1) is amended by 
     striking ``2010,''.
       (4) Paragraph (2) of section 2014(b) is amended by striking 
     ``2010, 2011,'' and inserting ``2011''.
       (5) Clause (ii) of section 2056A(b)(12)(C) is amended to 
     read as follows:
       ``(ii) to treat any reduction in the tax imposed by 
     paragraph (1)(A) by reason of the credit allowable under 
     section 2010 (as in effect on the day before the date of the 
     enactment of the Death Tax Elimination Act of 2000) or the 
     exemption amount allowable under section 2001(b) with respect 
     to the decedent as a credit under section 2505 (as so in 
     effect) or exemption under section 2521 (as the case may be) 
     allowable to such surviving spouse for purposes of 
     determining the amount of the exemption allowable under 
     section 2521 with respect to taxable gifts made by the 
     surviving spouse during the year in which the spouse becomes 
     a citizen or any subsequent year,''.
       (6) Subsection (a) of section 2057 is amended by striking 
     paragraphs (2) and (3) and inserting the following new 
     paragraph:
       ``(2) Maximum deduction.--The deduction allowed by this 
     section shall not exceed the excess of $1,300,000 over the 
     exemption amount (as defined in section 2001(b)(3)).''
       (7)(A) Subsection (b) of section 2101 is amended to read as 
     follows:
       ``(b) Computation of Tax.--
       ``(1) In general.--The tax imposed by this section shall be 
     the amount equal to the excess (if any) of--
       ``(A) the tentative tax determined under paragraph (2), 
     over
       ``(B) a tentative tax computed under section 2001(c) on the 
     amount of the adjusted taxable gifts.
       ``(2) Tentative tax.--For purposes of paragraph (1), the 
     tentative tax determined under this paragraph is a tax 
     computed under section 2001(c) on the excess of--
       ``(A) the sum of--
       ``(i) the amount of the taxable estate, and
       ``(ii) the amount of the adjusted taxable gifts, over
       ``(B) the exemption amount for the calendar year in which 
     the decedent died.
       ``(3) Exemption amount.--
       ``(A) In general.--The term `exemption amount' means 
     $60,000.
       ``(B) Residents of possessions of the united states.--In 
     the case of a decedent who is considered to be a nonresident 
     not a citizen of the United States under section 2209, the 
     exemption amount under this paragraph shall be the greater 
     of--
       ``(i) $60,000, or
       ``(ii) that proportion of $175,000 which the value of that 
     part of the decedent's gross estate which at the time of his 
     death is situated in the United States bears to the value of 
     his entire gross estate wherever situated.
       ``(C) Special rules.--
       ``(i) Coordination with treaties.--To the extent required 
     under any treaty obligation of the United States, the 
     exemption amount allowed under this paragraph shall be equal 
     to the amount which bears the same ratio to the exemption 
     amount under section 2001(b)(3) (for the calendar year in 
     which the decedent died) as the value of the part of the 
     decedent's gross estate which at the time of his death is 
     situated in the United States bears to the value of his 
     entire gross estate wherever situated. For purposes of the 
     preceding sentence, property shall not be treated as situated 
     in the United States if such property is exempt from the tax 
     imposed by this subchapter under any treaty obligation of the 
     United States.
       ``(ii) Coordination with gift tax exemption and unified 
     credit.--If an exemption has been allowed under section 2521 
     (or a credit has been allowed under section 2505 as in effect 
     on the day before the date of the enactment of the Death Tax 
     Elimination Act of 2000) with respect to any gift made by the 
     decedent, each dollar amount contained in subparagraph (A) or 
     (B) or the exemption amount applicable under clause (i) of 
     this subparagraph (whichever applies) shall be reduced by the 
     exemption so allowed under section 2521 (or, in the case of 
     such a credit, by the amount of the gift for which the credit 
     was so allowed).''.
       (8) Section 2102 is amended by striking subsection (c).

[[Page H4130]]

       (9)(A) Subsection (a) of section 2107 is amended by adding 
     at the end the following new paragraph:
       ``(3) Limitation on exemption amount.--Subparagraphs (B) 
     and (C) of section 2101(b)(3) shall not apply in applying 
     section 2101 for purposes of this section.''.
       (B) Subsection (c) of section 2107 is amended--
       (i) by striking paragraph (1) and by redesignating 
     paragraphs (2) and (3) as paragraphs (1) and (2), 
     respectively, and
       (ii) by striking the second sentence of paragraph (2) (as 
     so redesignated).
       (10) Paragraph (1) of section 6018(a) is amended by 
     striking ``the applicable exclusion amount in effect under 
     section 2010(c)'' and inserting ``the exemption amount under 
     section 2001(b)(3)''.
       (11) Subparagraph (A) of section 6601( j)(2) is amended to 
     read as follows:
       ``(A) the amount of the tentative tax which would be 
     determined under the rate schedule set forth in section 
     2001(c) if the amount with respect to which such tentative 
     tax is to be computed were $1,000,000, or''.
       (12) The table of sections for part II of subchapter A of 
     chapter 11 is amended by striking the item relating to 
     section 2010.
       (13) The table of sections for subchapter A of chapter 12 
     is amended by striking the item relating to section 2505.
       (d) Effective Date.--The amendments made by this section--
       (1) insofar as they relate to the tax imposed by chapter 11 
     of the Internal Revenue Code of 1986, shall apply to estates 
     of decedents dying after December 31, 2000, and
       (2) insofar as they relate to the tax imposed by chapter 12 
     of such Code, shall apply to gifts made after December 31, 
     2000.

      TITLE IV--MODIFICATIONS OF GENERATION-SKIPPING TRANSFER TAX

     SEC. 401. DEEMED ALLOCATION OF GST EXEMPTION TO LIFETIME 
                   TRANSFERS TO TRUSTS; RETROACTIVE ALLOCATIONS.

       (a) In General.--Section 2632 (relating to special rules 
     for allocation of GST exemption) is amended by redesignating 
     subsection (c) as subsection (e) and by inserting after 
     subsection (b) the following new subsections:
       ``(c) Deemed Allocation to Certain Lifetime Transfers to 
     GST Trusts.--
       ``(1) In general.--If any individual makes an indirect skip 
     during such individual's lifetime, any unused portion of such 
     individual's GST exemption shall be allocated to the property 
     transferred to the extent necessary to make the inclusion 
     ratio for such property zero. If the amount of the indirect 
     skip exceeds such unused portion, the entire unused portion 
     shall be allocated to the property transferred.
       ``(2) Unused portion.--For purposes of paragraph (1), the 
     unused portion of an individual's GST exemption is that 
     portion of such exemption which has not previously been--
       ``(A) allocated by such individual,
       ``(B) treated as allocated under subsection (b) with 
     respect to a direct skip occurring during or before the 
     calendar year in which the indirect skip is made, or
       ``(C) treated as allocated under paragraph (1) with respect 
     to a prior indirect skip.
       ``(3) Definitions.--
       ``(A) Indirect skip.--For purposes of this subsection, the 
     term `indirect skip' means any transfer of property (other 
     than a direct skip) subject to the tax imposed by chapter 12 
     made to a GST trust.
       ``(B) GST trust.--The term `GST trust' means a trust that 
     could have a generation-skipping transfer with respect to the 
     transferor unless--
       ``(i) the trust instrument provides that more than 25 
     percent of the trust corpus must be distributed to or may be 
     withdrawn by 1 or more individuals who are non-skip persons--

       ``(I) before the date that the individual attains age 46,
       ``(II) on or before one or more dates specified in the 
     trust instrument that will occur before the date that such 
     individual attains age 46, or
       ``(III) upon the occurrence of an event that, in accordance 
     with regulations prescribed by the Secretary, may reasonably 
     be expected to occur before the date that such individual 
     attains age 46;

       ``(ii) the trust instrument provides that more than 25 
     percent of the trust corpus must be distributed to or may be 
     withdrawn by one or more individuals who are non-skip persons 
     and who are living on the date of death of another person 
     identified in the instrument (by name or by class) who is 
     more than 10 years older than such individuals;
       ``(iii) the trust instrument provides that, if one or more 
     individuals who are non-skip persons die on or before a date 
     or event described in clause (i) or (ii), more than 25 
     percent of the trust corpus either must be distributed to the 
     estate or estates of one or more of such individuals or is 
     subject to a general power of appointment exercisable by one 
     or more of such individuals;
       ``(iv) the trust is a trust any portion of which would be 
     included in the gross estate of a non-skip person (other than 
     the transferor) if such person died immediately after the 
     transfer;
       ``(v) the trust is a charitable lead annuity trust (within 
     the meaning of section 2642(e)(3)(A)) or a charitable 
     remainder annuity trust or a charitable remainder unitrust 
     (within the meaning of section 664(d)); or
       ``(vi) the trust is a trust with respect to which a 
     deduction was allowed under section 2522 for the amount of an 
     interest in the form of the right to receive annual payments 
     of a fixed percentage of the net fair market value of the 
     trust property (determined yearly) and which is required to 
     pay principal to a non-skip person if such person is alive 
     when the yearly payments for which the deduction was allowed 
     terminate.
     For purposes of this subparagraph, the value of transferred 
     property shall not be considered to be includible in the 
     gross estate of a non-skip person or subject to a right of 
     withdrawal by reason of such person holding a right to 
     withdraw so much of such property as does not exceed the 
     amount referred to in section 2503(b) with respect to any 
     transferor, and it shall be assumed that powers of 
     appointment held by non-skip persons will not be exercised.
       ``(4) Automatic allocations to certain gst trusts.--For 
     purposes of this subsection, an indirect skip to which 
     section 2642(f ) applies shall be deemed to have been made 
     only at the close of the estate tax inclusion period. The 
     fair market value of such transfer shall be the fair 
     market value of the trust property at the close of the 
     estate tax inclusion period.
       ``(5) Applicability and effect.--
       ``(A) In general.--An individual--
       ``(i) may elect to have this subsection not apply to--

       ``(I) an indirect skip, or
       ``(II) any or all transfers made by such individual to a 
     particular trust, and

       ``(ii) may elect to treat any trust as a GST trust for 
     purposes of this subsection with respect to any or all 
     transfers made by such individual to such trust.
       ``(B) Elections.--
       ``(i) Elections with respect to indirect skips.--An 
     election under subparagraph (A)(i)(I) shall be deemed to be 
     timely if filed on a timely filed gift tax return for the 
     calendar year in which the transfer was made or deemed to 
     have been made pursuant to paragraph (4) or on such later 
     date or dates as may be prescribed by the Secretary.
       ``(ii) Other elections.--An election under clause (i)(II) 
     or (ii) of subparagraph (A) may be made on a timely filed 
     gift tax return for the calendar year for which the election 
     is to become effective.
       ``(d) Retroactive Allocations.--
       ``(1) In general.--If--
       ``(A) a non-skip person has an interest or a future 
     interest in a trust to which any transfer has been made,
       ``(B) such person--
       ``(i) is a lineal descendant of a grandparent of the 
     transferor or of a grandparent of the transferor's spouse or 
     former spouse, and
       ``(ii) is assigned to a generation below the generation 
     assignment of the transferor, and
       ``(C) such person predeceases the transferor,
     then the transferor may make an allocation of any of such 
     transferor's unused GST exemption to any previous transfer or 
     transfers to the trust on a chronological basis.
       ``(2) Special rules.--If the allocation under paragraph (1) 
     by the transferor is made on a gift tax return filed on or 
     before the date prescribed by section 6075(b) for gifts made 
     within the calendar year within which the non-skip person's 
     death occurred--
       ``(A) the value of such transfer or transfers for purposes 
     of section 2642(a) shall be determined as if such allocation 
     had been made on a timely filed gift tax return for each 
     calendar year within which each transfer was made,
       ``(B) such allocation shall be effective immediately before 
     such death, and
       ``(C) the amount of the transferor's unused GST exemption 
     available to be allocated shall be determined immediately 
     before such death.
       ``(3) Future interest.--For purposes of this subsection, a 
     person has a future interest in a trust if the trust may 
     permit income or corpus to be paid to such person on a date 
     or dates in the future.''.
       (b) Conforming Amendment.--Paragraph (2) of section 2632(b) 
     is amended by striking ``with respect to a direct skip'' and 
     inserting ``or subsection (c)(1)''.
       (c) Effective Dates.--
       (1) Deemed allocation.--Section 2632(c) of the Internal 
     Revenue Code of 1986 (as added by subsection (a)), and the 
     amendment made by subsection (b), shall apply to transfers 
     subject to chapter 11 or 12 made after December 31, 1999, and 
     to estate tax inclusion periods ending after December 31, 
     1999.
       (2) Retroactive allocations.--Section 2632(d) of the 
     Internal Revenue Code of 1986 (as added by subsection (a)) 
     shall apply to deaths of non-skip persons occurring after 
     December 31, 1999.

     SEC. 402. SEVERING OF TRUSTS.

       (a) In General.--Subsection (a) of section 2642 (relating 
     to inclusion ratio) is amended by adding at the end the 
     following new paragraph:
       ``(3) Severing of trusts.--
       ``(A) In general.--If a trust is severed in a qualified 
     severance, the trusts resulting from such severance shall be 
     treated as separate trusts thereafter for purposes of this 
     chapter.
       ``(B) Qualified severance.--For purposes of subparagraph 
     (A)--
       ``(i) In general.--The term `qualified severance' means the 
     division of a single trust and the creation (by any means 
     available under the governing instrument or under local law) 
     of two or more trusts if--

       ``(I) the single trust was divided on a fractional basis, 
     and
       ``(II) the terms of the new trusts, in the aggregate, 
     provide for the same succession of interests of beneficiaries 
     as are provided in the original trust.

       ``(ii) Trusts with inclusion ratio greater than zero.--If a 
     trust has an inclusion ratio of greater than zero and less 
     than 1, a severance is a qualified severance only if the 
     single trust is divided into two trusts, one of which 
     receives a fractional share of the total value of all trust 
     assets equal to the applicable fraction of the single trust 
     immediately before the severance. In such case, the trust 
     receiving such fractional share shall have an inclusion ratio 
     of zero and the other trust shall have an inclusion ratio of 
     1.
       ``(iii) Regulations.--The term `qualified severance' 
     includes any other severance permitted under regulations 
     prescribed by the Secretary.
       ``(C) Timing and manner of severances.--A severance 
     pursuant to this paragraph may be

[[Page H4131]]

     made at any time. The Secretary shall prescribe by forms 
     or regulations the manner in which the qualified severance 
     shall be reported to the Secretary.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to severances after December 31, 1999.

     SEC. 403. MODIFICATION OF CERTAIN VALUATION RULES.

       (a) Gifts for Which Gift Tax Return Filed or Deemed 
     Allocation Made.--Paragraph (1) of section 2642(b) (relating 
     to valuation rules, etc.) is amended to read as follows:
       ``(1) Gifts for which gift tax return filed or deemed 
     allocation made.--If the allocation of the GST exemption to 
     any transfers of property is made on a gift tax return filed 
     on or before the date prescribed by section 6075(b) for such 
     transfer or is deemed to be made under section 2632 (b)(1) or 
     (c)(1)--
       ``(A) the value of such property for purposes of subsection 
     (a) shall be its value as finally determined for purposes of 
     chapter 12 (within the meaning of section 2001(f )(2)), or, 
     in the case of an allocation deemed to have been made at the 
     close of an estate tax inclusion period, its value at the 
     time of the close of the estate tax inclusion period, and
       ``(B) such allocation shall be effective on and after the 
     date of such transfer, or, in the case of an allocation 
     deemed to have been made at the close of an estate tax 
     inclusion period, on and after the close of such estate tax 
     inclusion period.''.
       (b) Transfers at Death.--Subparagraph (A) of section 
     2642(b)(2) is amended to read as follows:
       ``(A) Transfers at death.--If property is transferred as a 
     result of the death of the transferor, the value of such 
     property for purposes of subsection (a) shall be its value as 
     finally determined for purposes of chapter 11; except that, 
     if the requirements prescribed by the Secretary respecting 
     allocation of post-death changes in value are not met, the 
     value of such property shall be determined as of the time of 
     the distribution concerned.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to transfers subject to chapter 11 or 12 of the 
     Internal Revenue Code of 1986 made after December 31, 1999.

     SEC. 404. RELIEF PROVISIONS.

       (a) In General.--Section 2642 is amended by adding at the 
     end the following new subsection:
       ``(g) Relief Provisions.--
       ``(1) Relief from late elections.--
       ``(A) In general.--The Secretary shall by regulation 
     prescribe such circumstances and procedures under which 
     extensions of time will be granted to make--
       ``(i) an allocation of GST exemption described in paragraph 
     (1) or (2) of subsection (b), and
       ``(ii) an election under subsection (b)(3) or (c)(5) of 
     section 2632.
     Such regulations shall include procedures for requesting 
     comparable relief with respect to transfers made before the 
     date of the enactment of this paragraph.
       ``(B) Basis for determinations.--In determining whether to 
     grant relief under this paragraph, the Secretary shall take 
     into account all relevant circumstances, including evidence 
     of intent contained in the trust instrument or instrument of 
     transfer and such other factors as the Secretary deems 
     relevant. For purposes of determining whether to grant relief 
     under this paragraph, the time for making the allocation (or 
     election) shall be treated as if not expressly prescribed by 
     statute.
       ``(2) Substantial compliance.--An allocation of GST 
     exemption under section 2632 that demonstrates an intent to 
     have the lowest possible inclusion ratio with respect to a 
     transfer or a trust shall be deemed to be an allocation of so 
     much of the transferor's unused GST exemption as produces the 
     lowest possible inclusion ratio. In determining whether there 
     has been substantial compliance, all relevant circumstances 
     shall be taken into account, including evidence of intent 
     contained in the trust instrument or instrument of transfer 
     and such other factors as the Secretary deems relevant.''.
       (b) Effective Dates.--
       (1) Relief from late elections.--Section 2642(g)(1) of the 
     Internal Revenue Code of 1986 (as added by subsection (a)) 
     shall apply to requests pending on, or filed after, December 
     31, 1999.
       (2) Substantial compliance.--Section 2642(g)(2) of such 
     Code (as so added) shall apply to transfers subject to 
     chapter 11 or 12 of the Internal Revenue Code of 1986 made 
     after December 31, 1999. No implication is intended with 
     respect to the availability of relief from late elections or 
     the application of a rule of substantial compliance on or 
     before such date.

                    TITLE V--CONSERVATION EASEMENTS

     SEC. 501. EXPANSION OF ESTATE TAX RULE FOR CONSERVATION 
                   EASEMENTS.

       (a) Where Land Is Located.--
       (1) In general.--Clause (i) of section 2031(c)(8)(A) 
     (defining land subject to a conservation easement) is 
     amended--
       (A) by striking ``25 miles'' both places it appears and 
     inserting ``50 miles'', and
       (B) striking ``10 miles'' and inserting ``25 miles''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply to estates of decedents dying after December 31, 
     1999.
       (b) Clarification of Date for Determining Value of Land and 
     Easement.--
       (1) In general.--Section 2031(c)(2) (defining applicable 
     percentage) is amended by adding at the end the following new 
     sentence: ``The values taken into account under the preceding 
     sentence shall be such values as of the date of the 
     contribution referred to in paragraph (8)(B).''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to estates of decedents dying after December 31, 
     1997.

  The SPEAKER pro tempore. After one hour of debate on the bill, as 
amended, it shall be in order to consider the further amendment printed 
in House Report 106-658, which may be offered only by the Member 
designated in the report, shall be considered read, and shall be 
debatable for one hour, equally divided and controlled by the proponent 
and an opponent.
  The gentleman from Texas (Mr. Archer) and the gentleman from New York 
(Mr. Rangel) each will control 30 minutes.
  The Chair recognizes the gentleman from Texas (Mr. Archer).


                             General Leave

  Mr. ARCHER. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
and include extraneous material on the bill, H.R. 8.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. ARCHER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, today is another historic and proud moment for this 
House, for our country, and for me personally. When I came to Congress 
30 years ago, I had three major goals. One was to balance the budget so 
that future generations would not have to pay the high debt service 
charges. The second was to eliminate the earnings limit on Social 
Security beneficiaries so that they continue to work without suffering 
the loss of their Social Security benefits. Both of those two are now 
the law of the land.

                              {time}  1000

  My third goal was to abolish the death tax. And today we will do that 
on a bipartisan basis. We will completely repeal it. We will erase it 
from the Tax Code forever, in hopes that it will never return from the 
dead to haunt American families, farms, businesses. This is truly an 
historic day.
  The death tax is wrong. Death as an event should not trigger a tax. 
Some have even said that it is ghoulish to think that someone who works 
an entire lifetime saving, preparing to leave something to their 
children, starting a business, running a ranch or a farm, and all the 
time paying taxes to find that what is left over gets hit again from 
the grave.
  The ancient Egyptians built elaborate fortresses and tunnels and even 
posted guards at tombs to stop grave robbers. In today's America, we 
call that estate planning.
  Today, Americans are trying to avoid the death tax like never before. 
In fact, they spend millions and millions of dollars every year paying 
accountants, lawyers and financial planners to try to limit this tax in 
any way that they can. And why should they not? The death tax is the 
natural born killer of everything that they have worked for their 
entire lives. It is the wrecking ball of a life's worth of achievement 
and success.
  Think about it. The top death tax rate today in the law is 60 
percent. That means the IRS gets 122 percent to 150 percent of what the 
children get. Is something not wrong when the government gets more than 
the family? And that is just the first generation of children. If 
someone wanted to help their grandchildren, and I know many of us in 
this Chamber and those watching on C-SPAN have grandchildren, I have 14 
myself, so just listen to this: Because of the death tax and what is 
part of it, a part of the death tax, the so-called generation-skipping 
penalty, the IRS gets 244 percent of what a grandchild does if a dying 
person leaves their assets to their grandchildren. That is outlandish. 
So today we are going to do what is right and we are going to fix it 
once and for all.
  The death tax is especially threatening to the backbone of America's 
economy, the small business owner and the family farm. That is why 
repealing the death tax is priority number one for the National 
Federation of Independent Businesses and the American Farm Bureau.
  Imagine a family owning and working on a family farm for 30 years. 
They build and develop the land with the hope of passing it along to 
their children so that they can have a better life. But after their 
death, the children tragically find that the farm will not

[[Page H4132]]

be staying in the family but will instead be going on the auction block 
to pay the IRS. Unfortunately, this is not a rare occurrence. Many 
family farms must be sold to pay the Federal taxes due on the property 
and many, many businesses, too.
  One-third of small business owners today will have to sell outright 
or liquidate a part of their company to pay death taxes. More than 70 
percent of family businesses do not survive the second generation, and 
87 percent do not make it to the third generation.
  The impact of the death tax on small business means it is especially 
threatening to women, women who are creating business at twice the rate 
of men today. Since 1987, the number of female-owned ventures has 
doubled from 4.5 million to 9.1 million. Last year women-owned 
companies employed more than 27 million Americans, nearly 9 million 
more than in 1996. These are the new CEOs. U.S. News and World Report, 
on its cover, featured this exact item. That is why women business 
owners are in strong support of complete repeal of the death tax.
  But the death tax does not just hit the business owner. It is a job 
killer, too. In fact, the tax hits hard-working Americans who lose 
their jobs and their health care when a business or a farm for which 
they work must be sold to pay the tax. Sixty percent of small business 
owners report that they would create new jobs over the coming year if 
estate taxes were eliminated. Half of those who must liquidate the 
business to pay the IRS will each have to eliminate 30 or more jobs. 
That is one of the reasons why liberals, moderates, and conservatives 
alike support getting rid of the death tax entirely. They understand 
this is not a rich against the poor issue, it is a jobs issue and a 
fairness issue. We should reward hard work and success and not punish 
it.
  Finally, the death tax is the grim reaper of personal savings in this 
country. The only cloud on our economic horizon is the death of 
personal savings in the U.S. Today's personal savings rate is the 
lowest it has ever been in the history of our nation, and the death tax 
is a dollar-for-dollar tax on savings.
  In summary, the death tax is simply unfair; and it is time to repeal 
it once and for all. No American, no matter what their income, should 
have to pay taxes when they die. They have worked all their life, they 
have paid taxes on that income all of their life, and they should not 
get socked one more time from the grave if they want to pass it on to 
their children or their grandchildren. Our children should come first, 
before the IRS, in the pecking order of family business, farm, or 
savings account.
  Benjamin Franklin, one of the wisest Founding Fathers, said there 
were two certainties in life, death and taxes. But I doubt if Dr. 
Franklin, even with his extraordinary foresight, could have told us 
that today both would occur at the same time. It is time to bury the 
death tax.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  The Committee on Ways and Means, under the leadership of the 
majority, has embarked on a political scheme before this election to 
present to the American people every week some type of a tax problem 
that they have not found a solution for. Unfortunately, before they 
bring the solution to the floor, they make certain that the President 
of the United States is going to veto it.
  It is absolutely remarkable how if they find a mosquito, they have to 
run for a sledgehammer to get rid of the problem. Take, for example, 
our very complex tax system, which year after year that they have been 
in the majority they have made even more complex. Just weigh the Tax 
Code that we had before they had the majority and weigh it today and 
see what they have done to it.
  Do our colleagues come and say to the Democrats and to the President 
that this system is overbearing, can we not work together to resolve it 
by simplifying it? No. No. What is the Republican solution? Let us pull 
the Tax Code up by the roots.
  If we have a problem with people being married paying too much taxes, 
do they just take care of it? No. They will have a tax cut so severe 
that the President of the United States would say we should take care 
of that problem, but we should not have to do it at the expense of not 
reducing the Federal debt, placing into jeopardy the Social Security 
System and our Medicare system.
  The emotional thing to talk about is how families would lose their 
businesses and their farms as a result of the hard work that their 
parents and grandparents have done. It would be wrong for this to 
happen. And even though we are only talking about 2 percent of the 
American people that would be subjected to a review of their taxes, 
they are still Americans, and they are still entitled to equity. But do 
we really say that the answer to this problem, and it is a problem, is 
to repeal the estate tax completely? Under the Democratic alternative 
the Republicans would be hard put to see whether any rancher, any 
farmer, any small business will be lost as a result of the $4 million 
exemption. I say exemption, which means that they do not even have to 
think about the reduced rate of taxes.
  Every estate planner knows that we have a better alternative. They 
know we take care of the problem. But we do not take care of the 
multibillion-dollar estates. That is what we do not take care of. We do 
not take care of those people who have had creative ideas, who have 
built up equities and tax liabilities that go into many numbers in 
terms of tax liabilities, that have never been taxed and would only be 
exposed to taxation at death. We do not talk about those. Oh, we 
probably have some in Texas and some in New York, but what we wanted to 
do was take care of 99.9 percent of the businesses that would be 
adversely affected, and this we have done.
  My colleagues have an emotional argument talking about repeal. But 
one day the American people will take a look at the cost of the 
Republicans' bill, the cost of repeal, and wonder whether the 
Republicans were thinking about them or whether they had a handful of 
people that have been kind to them that they are trying to get relief 
for. Because anybody can tell my colleagues that their bill in the year 
2011 will start having a revenue hemorrhage of $50 billion a year. 
Maybe my colleagues are prepared to say that they feel that we can 
afford to do that and take care of Social Security, take care of 
Medicare, take care of the Patients' Bill of Rights, take care of 
affordable prescriptions; or, really, do they care at all?
  This is a great shot in the arm for my colleagues because they know 
the President is going to be responsible. None of them would be so 
irresponsible to be proposing this if they thought it would become law. 
They know it is going to be vetoed. They know that next week they will 
be coming back with something else that will be vetoed.
  I am just asking this. In the last weeks of this Congress, can we not 
come together on something and agree on it? Must we try to seek a 
Republican political statement instead of a bipartisan agreement? If 
everyone would conclude that the Democrat alternative takes care of the 
problem that we are talking about, why do we have to go beyond that and 
hemorrhage the revenue for those people that will become eligible in 
the next 10 years for Medicare and Social Security? My Republican 
colleagues know it is going to be vetoed, but it is not the right thing 
to do.
  Mr. Speaker, I ask unanimous consent to yield the balance of my time 
to the gentleman from Maryland (Mr. Cardin), and that he be allowed to 
manage the time on our side.
  The SPEAKER pro tempore (Mr. Kolbe). Without objection, the gentleman 
from Maryland (Mr. Cardin) will control the rest of the gentleman's 
time.
  There was no objection.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
Washington (Ms. Dunn), who has authored this bill in combination with 
the gentleman from Tennessee (Mr. Tanner) on a bipartisan basis. She 
has worked so hard over the years to get us to where we are today.
  Ms. DUNN. Mr. Speaker, I want to thank the gentleman for yielding me 
this time and for bringing this bipartisan bill to the floor of the 
House today.

[[Page H4133]]

  I want to thank my colleague, the gentleman from Tennessee (Mr. 
Tanner), for the hard work he has done over the years as we move this 
important endeavor to the floor of the House. H.R. 8 has the support of 
246 Members of the House of Representatives, 46 Democrats, and one 
Independent.

                              {time}  1015

  There is one main reason, Mr. Speaker, why the majority of this 
Congress and 85 percent of the American people support the repeal of 
the death tax, that reason is fairness. It has been said that only with 
our government are you given a certificate at birth, a license at 
marriage, and a bill at death.
  One of the most compelling aspects of the American dream is to make 
life better for our children and our loved ones. Yet the current tax 
treatment of a person's life savings is so onerous that when one dies, 
the children are often forced to turn over sometimes more than half of 
their savings of their parent's hard work during their lifetimes to the 
Federal Government.
  Even worse, not only does this take place at an agonizing time in the 
life of a family, but often these people are forced to watch their 
loved one's legacy be snatched up by an entity not known for its great 
insight in spending taxpayer funds. This is not fair.
  Death should not trigger a tax. We should not dishonor the hard work 
of those who have passed on. This is especially true, Mr. Speaker, of 
minority and women-owned businesses.
  Minorities understand that sometimes it takes two to three 
generations to build an economic foothold in a community through a 
family-held business. That is why the Black Chamber of Commerce, the 
Hispanic Chamber of Commerce, the National Indian Business Association, 
and the Pan-American Chamber of Commerce support H.R. 8.
  In addition, a recent study by the National Association of Women 
Business Owners revealed that women-owned businesses on average spend 
$1,000 a month complying for the death tax. These dollars should go to 
benefits like health coverage for the 44 million who are uninsured. Mr. 
Speaker, I urge my colleagues on the floor to vote for H.R. 8.
  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to a senior Member of the 
Committee on Ways and Means, the gentleman from California (Mr. Stark).
  (Mr. STARK asked and was given permission to revise and extend his 
remarks.)
  Mr. STARK. Mr. Speaker, I have a rather personal interest in this 
legislation, and I have heard a lot from the chairman of the Committee 
on Ways and Means about what we owe our children, so I have come to the 
well this morning and apologize to my children, I have 5, and 10 
grandchildren.
  I am probably one of the few Members of the House who started out 
poor. I used to say I was so poor as a kid I never slept alone until I 
was married. But through good luck and the action of commerce, I was 
able to amass what most of the people in my district would call a 
fortune. And I have not paid much tax on that. I pay income tax each 
year. I pay more income tax than you pay me salary, but most of what I 
have was accumulated through capital gains, and I have not sold it. I 
do not intend to.
  My kids will get it pretty much free. So I apologize because I am 
going to vote against this. Kids, to Jeff and Bea and Thekla and Sarah, 
Fortney and the 10 grandkids, you are going to have to pay some tax. 
This is a little family business, it might be 7 figures, but you are 
going to get a down payment on that from your mother and me of 
$1,350,000 free. You have not worked a day in your life for that.
  You have a college education, down payment on your homes, cars, but 
you have not worked worth squat. But you are going to get a million, a 
million and a half bucks. And then you are going to get half that 
business free and you may have to pay 50 percent, 55 percent on that 
tax if they appraise the business at its full value. And you are going 
to get 10 years to pay that off at a below prime rate interest rate. 
And, kids, if you are so dumb that you cannot run that business with 
over a 50 percent down payment given to you and 10 years to pay off the 
balance at a low rate, you do not deserve it.
  You ought to have been trained in this country to earn your own way 
and pay your taxes every day so that Dad can have a prescription drug 
benefit and I can have a decent nursing home so you do not have to 
worry about taking care of me in my dotage.
  There are not very many Members of Congress that are going to pay any 
inheritance tax, and do not believe them. This is a gift to the rich 
not for independent, smart kids like I have hoped I raised.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from South 
Carolina (Mr. Graham).
  Mr. GRAHAM. Mr. Speaker, the gentleman has quite a legacy. In 
response to the gentleman that just spoke, the gentleman from 
California (Mr. Stark), I am the first person in my family to ever 
graduate college, I do not have a fortune. I admire the fact that he 
wants to construct life for his children a certain way, but this 
gentleman is making decisions for millions of Americans, let him make 
his own decision.
  What I would like to have is a decision made up here that empowers 
people that if they want to give money to the church instead of the 
government they can. We collect less than 2 percent from the death tax 
in this country, and to get that 2 percent here is what you lose: You 
lose family farms in my district in droves because people are land rich 
on paper and cash poor. You lose the small business that cannot go to 
the next generation to get less than 2 percent to monkey with the money 
up here.
  Philanthropy is lost. The human spirit is suppressed. Most people 
want a legacy. They want to give something back, a library, a hospital 
wing, a donation to their church. This is a form of socialism that must 
go. Let us start a new century with a Tax Code that brings out the best 
in the American people not the worst. To get 2 percent of the money, we 
have to ruin a lot of families and that is unnecessary. I say 
congratulations to the gentleman from Texas (Mr. Archer)
  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to a distinguished member 
of the Committee on Ways and Means, the gentleman from Michigan (Mr. 
Levin).
  (Mr. LEVIN asked and was given permission to revise and extend his 
remarks and include extraneous material.)
  Mr. LEVIN. Mr. Speaker, socialism? Teddy Roosevelt's idea? Members 
come here with all the talk about fairness and about women and 
minorities, we are talking about 2 percent of the decendents in this 
country, the very wealthy; that is what we are talking about.
  What is the problem? The substitute addresses them, family farms? 
Ninety-eight or 90 percent of the family farms will be taken out of an 
estate tax by the substitute. Small businesses? Only 1/10 of 1 percent 
are subject to the estate tax. Members come here raising the banner of 
all of these small businesses. We are talking about a small portion of 
them, and the vast majority of them will be taken care of by the 
substitute. And all of the others who are subject to the estate tax, 
the substitute addresses their needs faster than your bill.
  In a sense, those of us who are on the other side of this issue have 
lost the propaganda battle. Members have managed to move an estate tax 
to a death tax, but I have no hesitation to go back to my district and 
to talk about what the impact of this repeal would mean for 98 percent 
of my constituents, 98 percent.
  I will talk about Members coming here yesterday and not being able to 
fund Head Start, not being able to fund training; and we are going to 
give, 10 years from now, a $50 billion tax cut to the very wealthy in 
this country? I will take that battle on any time.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to a distinguished and 
respected Member of the Committee on Ways and Means, the gentleman from 
Arizona (Mr. Hayworth).
  Mr. HAYWORTH. Mr. Speaker, how sad and how cynical that the left can 
only embrace the politics of envy. How sad that today they rely on 
tired, shopworn old arguments attempting to divide Americans, when we 
will see in this Chamber later today a bipartisan majority standing up 
for tax fairness intent on putting the death tax to death.

[[Page H4134]]

  Our constitutional republic was founded, in part, because the people 
in that time stood up against taxation, no taxation without 
representation was their rallying cry. Today, all Americans stand up to 
say no taxation without respiration, because it is fundamentally 
unfair, regardless of your economic station in life, to have this tax 
visited upon the American people.
  And here is why for the disconnect that seems to affect my friends on 
the left when they lament the facts that this affects only 2 percent of 
the populace, a little economic primer, friends. Mr. Speaker, 
government does not create jobs. The American people, through their 
entrepreneurial endeavor and spirit, create jobs; and in the private 
sector, we should not inhibit that. That is why the Hispanic Chamber of 
Commerce, that is why the Black Chamber of Commerce understands that 
the color of economic opportunity in this country is green, in terms of 
capital, to create jobs, to create growth and economic opportunity, to 
let families hang on to their farms and ranchers and small businesses 
and, yes, to succeed.
  This is the fundamental difference, Mr. Speaker. We embrace the 
principles of prosperity. My friends on the left embrace the politics 
of envy.
  Mr. CARDIN. Mr. Speaker, I yield 1 minute to a distinguished member 
of the Committee on Ways and Means my friend, the gentleman from 
Tennessee (Mr. Tanner).
  Mr. TANNER. Mr. Speaker, I want to thank the gentleman from Maryland 
(Mr. Cardin) for yielding me the time and say that I rise in support of 
H.R. 8. The estate tax is an outmoded, inefficient, complicated 
subjective tax. The Tax Code needs to be rewritten. This is a good 
first step.
  This tax applies, as I am told, and I came to this from the 
standpoint of a small business and family farmer, over 70 percent of 
estate taxes that are filed on estates of $5 million or less, we are 
told that this costs 72 cents of every dollar collected simply to 
administer it, and for that reason, I support H.R. 8. I thank my 
colleague, the gentlewoman from Washington (Ms. Dunn) for her 
cosponsorship.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to another respected and 
distinguished member of the Committee on Ways and Means, the gentleman 
from Florida (Mr. Foley) .
  Mr. FOLEY. Mr. Speaker, I applaud the House today for considering 
this very important initiative. In the late 1950s, many Hispanic-
Americans came to this country. Cuban-born fleeing Cuba because of the 
tyranny of Fidel Castro. He stole their property. He stole their 
fortune, and they left their homeland penniless and came often to south 
Florida.
  They worked hard against daunting odds, new to a country with no 
family roots in this Nation. They succeeded oftentimes because of hard 
work and a lot of the American freedom and spirit and integrity. Lo and 
behold those same, now Americans born in Cuba, are suffering because 
estate taxes are depriving their heirs of their heritage.
  They left Communism to come to freedom and find our own policies here 
in America confiscatory. Now, a lot of people keep talking about the 
rich, oh, the rich in America. The rich know how to figure it out. They 
have the dollars in their pocket to buy high-dollar denomination 
insurance policies or they leave their money to trust. Ted Turner, Bill 
Gates, look at the billions they have given away, and they will deplete 
the accounts before the U.S. government will get their hands on it. 
They are smart. They are sophisticated. They made it their own way.
  I started a little business when I was 21. My mother and I and my 
family invested a lot of money to build a small business. This debate 
is not about my parent. They do not have a large estate, nor is it 
about me. I do not either. But never did the U.S. government or the 
local government help me with my business. It was always a regulation 
of rule, a fee, a permit, a tax, a license, a this, a that and the 
other. And we spent, spent money to keep up with government's plans for 
us. Never did they be a partner with me, but lo and behold when I die, 
they sure join in the parade.
  Let me pull money out of your pocket to spend on all kinds of 
programs. So, folks, let us get serious. Let us help all Americans and 
repeal the death tax.
  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to a distinguished member 
of the Committee on Ways and Means, the gentleman from Texas (Mr. 
Doggett).
  Mr. DOGGETT. Mr. Speaker, ``Inherited economic power is as 
inconsistent with the ideals of this generation as inherited political 
power was inconsistent with the ideals of the generation which 
established our government.''

                              {time}  1030

  ``If ever our people become so sordid as to feel that all that counts 
is moneyed prosperity, ignoble well-being, effortless ease and comfort, 
then this Nation shall perish as it will deserve to perish from this 
earth.''
  Those are the bold words of a Republican, a different mold of 
Republican than we find today, one named Teddy Roosevelt who was the 
person who first proposed the estate tax in 1906 that this new crowd of 
Republicans is so intent on mislabeling as the ``death tax.'' Teddy 
Roosevelt's words ring as true at the beginning of this new century as 
they did when they were uttered at the beginning of the last. This bill 
should rightfully be called the ``Billionaire Protection Act.''
  Treasury Secretary Summers said yesterday that this represents ``the 
most regressive tax bill'' he has ever seen. That is because 95 percent 
of the benefits go to the richest 1 percent of the decedents. 
Masquerading as the defenders of small business and family farmers, 
this crowd saves its true benevolence every year for Steve Forbes, Ross 
Perot, and what Forbes magazine recently described as the ``overclass'' 
in America, because they have so very much more money than what we 
usually consider as being wealthy. This ``overclass'' of the privileged 
few will be welcoming this bill with open arms and open wallets.
  Yes, we should modify the estate tax to meet the legitimate concerns 
of small businesses. The substitute that I support provides family-
owned businesses more estate tax relief sooner than the Republican 
proposal will. There is no good public policy reason to eliminate taxes 
on the ultra-wealthy in order to meet the needs of family-owned 
businesses and farms.
  As for the last speaker's comments about charity, remember that the 
wealthiest estates give twice as much to charity as they do to the tax 
collector. Every charity, every religious and educational institution 
in this country will be a loser under this bill. All of this harm to 
the Treasury and to our charitable institutions for the sole purpose of 
giving those at the very top, the richest few in this country, the 
``overclass'' in this country, the benefits of this bill. It is wrong 
and it should be rejected.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Thomas), a distinguished and respected member of the 
Committee on Ways and Means.
  (Mr. THOMAS asked and was given permission to revise and extend his 
remarks.)
  Mr. THOMAS. Mr. Speaker, I want to thank the chairman of the 
Committee on Ways and Means. It was a long, hard road to reach this 
day; and we still are hearing repeatedly that some people just do not 
get it. The gentleman from Michigan said 98 percent of his constituents 
are not going to benefit from the elimination of the death tax.
  Why did the polls repeatedly show a majority of Americans support 
repeal? It is pretty simple. It is called the American dream.
  All one has to do is go to Ellis Island. My colleagues know the 
words: ``Give me your tired, your poor, your huddled masses yearning to 
breath free.'' Yearning? The dictionary says, Yearning: to have a 
strong or deep desire. To be filled with longing. Free. Freedom to 
choose, to do what you want to do; freedom from want, from fear.
  If someone works and really does not do a good job of developing and 
living the American dream, they get taxed once. If someone works hard, 
saves, takes care of their family, creates, produces jobs, currently, 
in this country, they get taxed twice.
  Do my colleagues know what? Those 98 percent who are not going to get 
the immediate benefits of this believe in the American dream. They want 
to have the opportunity, the freedom, to leave their fruits to their 
children. Let us today vote yes on the repeal of the death tax and yes 
in favor of the American dream.

[[Page H4135]]

  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from 
Massachusetts (Mr. Frank).
  Mr. FRANK of Massachusetts. Mr. Speaker, I agree, there are many 
people who have this dream, the dream of not doing very much during 
their life except have a good time, and then having been smart enough 
to have rich parents who have millions of dollars.
  Now, there is an inconvenience if one inherits millions of dollars 
today. There will be some tax on them. But if the Republicans have 
their way, one will be able to dream one's way into wealth, not because 
of any single thing they did other than to be born into the right 
circumstances.
  This is not a tax on death. Dead men tell no tales, and dead men and 
women pay no taxes. This is a tax on those who inherent the wealth that 
was earned by others.
  Now, there is nothing the matter with that. If people ask my advice, 
I would say sure, I think it is a very good idea to have rich 
relatives. If I were you, I would try very hard to have rich parents. I 
would try very hard to have rich parents, and maybe they will leave you 
some money. But the tax is on the beneficiaries of other people's work, 
and what a tax repeal.
  I think if we were giving a prize for the single worst idea to come 
forward from the group that has been rife with them, it would be this. 
The idea is this: let us make the Tax Code of America better for very 
rich people. Let us give substantial tax relief to the richest people 
we can find. Forget about the person making $40,000 a year and paying 
Social Security payroll taxes. Forget about all of those other people 
paying income tax. We are here to give tax relief to the richest 2 
percent of America.
  Small business. I must say, every cloud has a silver lining. For 
once, some of my friends on the other side have seen merit in trying to 
help minority businesses and women-owned businesses, but I would say to 
my colleagues, do not do that by using them as a front to give 
substantial tax relief, not to the wealthiest people in America, but to 
the relatives of the wealthiest people in the America, who may or may 
not have done anything to earn it. Yes, people should be able to enjoy 
what they earn, and they can even enjoy what other people earn, but not 
quite without any taxation at all.
  This from a group that says we cannot afford to subsidize 
prescription drugs for middle-income elderly people. We have to cut 
Pell grants. My Republican colleagues want to help older people as long 
as they are very wealthy.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Illinois (Mr. Weller), another distinguished and respected member of 
the Committee on Ways and Means.
  (Mr. WELLER asked and was given permission to revise and extend his 
remarks.)
  Mr. WELLER. Mr. Speaker, I want to commend the leadership of the 
gentleman from Texas (Mr. Archer) and the gentleman from Tennessee (Mr. 
Tanner) and the gentlewoman from Washington (Ms. Dunn) and the 
gentleman from Hawaii (Mr. Abercrombie) for their leadership on this 
legislation.
  The death tax is a bad idea. The death tax is bad social policy. The 
death tax is unfair, and it is just plain wrong for the Government to 
confiscate the life's work at the time of death. The death tax is also 
bad for the environment.
  Why are so many major and respected environmental groups supporting 
elimination of the death tax? Because environmental groups say that the 
death tax is bad for the environment. The death tax encourages suburban 
sprawl in Illinois. The death tax encourages the loss of valuable 
farmland in Illinois. The death tax destroys valuable open space and 
wildlife habitat in Illinois. Let me give an example of why.
  I represent the Chicago south suburbs surrounded by some of the best 
farmland in the world. This farmland is not only good farmland; but 
because of its location, it is prime and ripe for development and 
because of its potential price, the sale price for development, it 
triggers the death tax, and many children of family farmers in the 
areas surrounding the suburbs here in Washington, D.C., or in any major 
metropolitan area are forced to sell much or all of the family farm, 
just to pay the death tax; and usually it is sold to developers, losing 
its use as valuable open space and farmland.
  Let us keep the family farm in farming by eliminating the death tax. 
Let us protect valuable open space by eliminating the death tax. Let us 
protect valuable wildlife habitat by eliminating the death tax.
  I say to my colleagues, the death tax is bad for the environment. 
Oppose the substitute, support this legislation, vote aye. It deserves 
a good, bipartisan vote.
  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Becerra), another distinguished member of the Committee 
on Ways and Means (Mr. Becerra).
  Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding; and I 
hope that my colleagues will vote against this measure. We hear talk 
about the American dream and how we want to give every American this 
American dream. Absolutely, we want to give every American this 
American dream. Every American.
  When America learns that what we are talking about is not giving ever 
American the American dream through this bill, but only 2 percent of 
Americans the American dream, because only 2 percent will ever receive 
a tax cut in this bill, because only 2 percent of estates ever pay any 
estate tax. Forget about 98 percent of America, and it is not any 98 
percent of America, it is the 98 percent that falls below the 2 percent 
richest Americans, who will receive nothing. Only the 2 percent most 
influential and richest will get this break.
  This is about as irresponsible as we can get. We are facing a time 
recently where we had $300 billion deficits. We are paying more than 
$200 billion a year in interest payments on the national debt. We 
finally have a surplus; we finally have a chance to be fiscally 
responsible. We finally have a chance to talk about perhaps getting 
prescription drug coverage for our seniors under Medicare. We finally 
have a chance to talk about shoring up Social Security. We finally have 
a chance to talk about giving our kids a chance to break away from the 
digital divide and have a computer in their classroom.
  We could pay for a computer for every child in America, rich or poor, 
with the money we are about to give in tax cuts to 2 percent of America 
at the top of the ladder. We could provide prescription drug coverage 
with the money we are going to spend on this, because the $50 billion a 
year it will cost us is more than what we are budgeting than the 
Republican Congress is budgeting for prescription drug coverage and 
Medicare in its budget for the next 5 years.
  Think of it. The budget that we passed out of this House says $40 
billion should be allocated for prescription drug coverage for seniors, 
millions and millions of seniors. Yet over 1 year, it will take $50 
billion out of the Treasury to make up the tax cut that only 2 percent 
of the wealthiest Americans will receive. That is not responsible. That 
is not what we should do. Let the American dream live for everyone, not 
just for 2 percent of Americans.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Hawaii (Mr. Abercrombie), who has contributed toward the development of 
this proposal.
  (Mr. ABERCROMBIE asked and was given permission to revise and extend 
his remarks.)
  Mr. ABERCROMBIE. Mr. Speaker, for 1 minute, can we just set aside all 
of this rhetorical, divisive language about left and right and who 
wants to stiff-arm 2 percent or 98 percent. That is not what this is 
about. The whole basis of this law has changed. We have to recognize 
that there are middle-income businesses, small businesses all 
throughout this country that would benefit from a change; and we all 
know that there is an objection with respect to whether or not the 
megawealthy may or may not be able to have more advantages than they 
have right now.
  This is the first step in a legislative process, and we can be 
thankful to the gentleman from Tennessee (Mr. Tanner) and the 
gentlewoman from Washington (Ms. Dunn) and to the gentleman from New 
York (Mr. Rangel) and to the gentleman from Texas (Mr. Archer), who are 
excellent legislators. Everyone knows that. They will put together a 
package that in the end is

[[Page H4136]]

going to achieve tax equity and fairness for the overwhelming majority 
of Americans who deserve it, that is going to help preserve jobs and 
that is going to see to it that the small businesses throughout this 
country and the jobs that they create are going to be preserved and 
protected.
  Mr. Speaker, I rise in support of H.R. 8. it is pro-jobs and pro-tax 
fairness, and the House should pass the bill by a wide majority.
  As many of you know, I have been a long time supporter of working 
people and their interests. It is from those perspectives that I come 
here today to support H.R. 8 and urge the reform of the federal estate 
tax law.
  A permanent federal estate tax was first enacted in 1916. there was 
clearly a revenue raising need as a result of the U.S. entering World 
War I. But there were also philosophical and political motives in that 
great fortunes had been amassed during the industrial revolution, and 
there was felt to be a progressive public policy objective of stopping 
the perpetuation and transmission of the great control that inherently 
accompanied vast wealth and estates.
  At the time, there was compelling and legitimate concern that vast 
fortunes, estates and trust were limiting access to capital by the 
emerging middle-class entrepreneurs.
  We are now, however, in the 21st Century. Our economy, society and 
means of production have radically changed. We are no longer primarily 
an agrarian economy, and in many ways we may be nearing the end of 
heavy industry phase of our economic development. The outdated laws 
governing industry, commerce and society of the early 20th Century must 
be changed to reflect the realities of the year 2000 and beyond.
  Capital remains a key component of business formulation and 
development. It is not, however, being concentrated by entities subject 
to the estate tax as in 1916.
  Irrelevant and antiquated 19th and early 20th Century laws may be a 
hindrance to how our society now functions. Federal estate and gift tax 
law fits that category.
  My perspective on the issue is that current law diminishes the 
capability of small businesses, and the jobs associated with them, to 
continue after the death of an owner or owners. Some studies (Heritage 
Foundation) have indicated that as many as 145,000 additional new jobs 
could be created by repeal of the estate tax law. As much as $11.0 
billion in additional economic output could result. The preservation 
and expansion of smaller, family businesses will protect jobs, and 
generate and expand the number of new jobs.
  For example, I represent the State of Hawaii, a state dominated by 
small businesses. Plantation agriculture has virtually ended and with 
the demise and economic dislocation associated with economic change, we 
are working hard to diversify Hawaii agriculture. This means many more 
smaller scale farmers growing specialty and niche crops instead of 
millions of tons of sugar. The middle class in Hawaii has developed 
from small business origins, and we now have great hope that a new 
generation of entrepreneurs will help sustain the economy through the 
new farming opportunities available for the first time in generations. 
I want to help preserve and develop those elements in Hawaii and in the 
American economy and society that generate millions of jobs.
  Regarding tax fairness, an equally compelling case is made that the 
wealthiest do not pay their fair share of estate taxes. The Tax Code 
has deliberately been riddled with exemptions and exceptions that are 
ruthlessly and thoroughly exploited by tax attorneys specializing in 
the preservation of inherited wealth. There is an entire body of tax 
law devoted to estate and gift tax avoidance and minimalization.

  Tax attorneys, I assure you, are talented and hard-working. The 
result is the majority of estates paying estate taxes are valued at 
$5.0 million and less. These are not the Rockefellers, Vanderbilts, 
Carnegies and J.P. Morgan robber barons the 1916 law was enacted to 
curb. Huge fortunes have for generations been sheltered with 
sophisticated, complex tax machinations. It is family farm and small 
businesses owners who are being penalized when trying to pass down 
assets to new generations to keep middle-class businesses in operation 
and generating employment. I can assure you I know of no small 
businesses in Kaneohe, Makiki, Waianae or Mililani, Hawaii that resort 
to multi-generation skipping trusts in order to keep a bakery or a 
delivery service in operation.
  Lastly, there is a human element in this debate that must be noted. 
One of my constituents, Steve Lee, is an estate attorney and planner in 
Honolulu. Mr. Lee's father inherited a few apartments from his parents 
some time ago. Mr. Lee's grandparents worked hard for years, acquiring 
the apartments as a means of assuring retirement income. Now his father 
is spending hours trying to figure our how to keep the property intact 
to pass it along to Mr. Lee and his brother. The Lees are middle-income 
in Hawaii. The value of real property acquired years ago, however, has 
been greatly inflated and the Lee brothers will face the need to 
liquidate at least part of the property in order to pay estate taxes in 
9 months. The Lees justifiably feel they are being penalized for having 
kept their property intact within their family.
  Mr. Speaker, our current estate tax fails to meet the goals we 
expect. It is overly complex to the point of being arcane, the burden 
on those upon whom it falls is unfair and inefficient.
  Passing H.R. 8 today is the first major step. As we move through the 
legislative process, however, we will also seriously consider proposals 
that would provide interim, transitional relief. We will seriously 
consider any inequities that total elimination might engender. We will 
address Presidential objections. We can forge a bill acceptable to all 
who want tax equity.
  Consequently, I look on H.R. 8 as both tax fairness, and pro-jobs and 
I am pleased to be associated with John Tanner, Jennifer Dunn, Bill 
Archer, Eva Clayton and others in helping move estate tax reform 
legislation through Congress.
  I urge the House to pass the bill, and bring more fairness to the Tax 
Code.
  Mr. CARDIN. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
California (Mr. Sherman).
  (Mr. SHERMAN asked and was given permission to revise and extend his 
remarks.)
  Mr. SHERMAN. Mr. Speaker, yesterday we slashed money for education 
for teachers, for after-school programs, for Head Start. Today, they 
want to cut $50 billion per year from Federal revenues. Two percent of 
American families even pay this tax. Three percent of those involve 
family farms and family businesses, so only 6 out of every 10,000 
families fit into the category of having a family farm or family 
business affected by this tax.
  The Democratic bill does far more for those family farms and 
businesses. Immediate relief. A bill that will be signed into law. But 
only the Republican bill provides the billionaire's tax relief act. Not 
one penny for those who make $6 an hour or $10, not relief at the 
democratic level for small businesses, but huge relief for 
multibillion-dollar fortunes.
  Furthermore, the Republican bill will slash major endowments for 
colleges, universities, and conservation programs. Those folks will be 
here asking for Federal help, and we will not be able to give it to 
them because we will have cut revenues by $50 billion. The Republican 
bill even contains a hidden provision which will increase income taxes 
on widows. There are plenty of reasons, 50 billion reasons, to vote no 
on the Republican bill and yes on the Democratic substitute.

                              {time}  1045

  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio 
(Mr. Traficant).
  (Mr. TRAFICANT asked and was given permission to revise and extend 
his remarks.)
  Mr. TRAFICANT. Mr. Speaker, in America we pay income and capital 
gains tax; investment, business, pension tax, luxury tax, property tax, 
sales tax, fuel tax. We even pay a surtax, and once, a retroactive tax. 
We are taxed coming and going.
  If that is not enough to glorify a 1040, we even pay a death tax in 
America. Beam me up. Once again, we hear the same old story. We come to 
the floor and beat up on the rich.
  I think it is time, Mr. Speaker, to stop the class warfare in 
America. Why should families who achieve in life be destroyed in death? 
Why should farmers have to surrender their farms to the government and 
not pass their farms on to their kids? Tell me and answer that 
question.
  Mr. Speaker, my family was very poor, really. But my dad never worked 
for a poor man. And tell me, who hires the workers in America? Is it 
the guy on the street corner, or the people who achieve and have 
success and make something from the great American dream?
  I support the gentleman from Texas (Mr. Archer) today, because I 
believe that in America today, from womb to tomb, from farm to harm, 
the American people are literally taxed off, ripped off by a Congress 
that sees nothing but revenue.
  I yield back the fact that I will not only vote to put the death tax 
to death, I also recommend to the chairman that we kill the income tax, 
abolish the

[[Page H4137]]

IRS, and replace it with a 15 percent national retail sales tax, and 
give some tax freedom to the people of the United States of America.
  I want to commend the chairman and commend those Democrats that are 
making some common sense.
  Mr. CARDIN. Mr. Speaker, I yield myself such time as I may consume.
  Let me just remind my friend from Ohio, Mr. Speaker, that only 3 
percent of the taxable estates have family-owned businesses or farm 
assets of any significance. That is less than .06 percent of all of the 
estates, and the Democratic substitute will deal with that problem in a 
far less costly way.
  Mr. Speaker, I yield 2 minutes to the gentleman from Maine (Mr. 
Baldacci), a member of the Committee on Agriculture.
  (Mr. BALDACCI asked and was given permission to revise and extend his 
remarks.)
  Mr. BALDACCI. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  Mr. Speaker, as a small business person and a former member of the 
Committee on Small Business, I am very aware of the burden under which 
many entrepreneurs and working families must operate. I have a family 
business, and I understand the concerns of those who want to pass their 
businesses on to the next generation.
  I am also on the Committee on Agriculture, and I know my family farms 
in Maine, many of which are in the same families for generations, need 
to have relief. That is why we in this Congress were able to pass 
measures to reduce their tax burden. In such a case, 98 percent of the 
estates and family farms and farm businesses and small businesses have 
been exempted.
  As a matter of fact, each member of a married couple is eligible for 
the exemptions we passed, which can be twice the initial amount, up to 
2 million by 2006.
  Having said that, I understand the importance of living within our 
means and planning for the future. The estimated cost for repealing 
this completely with H.R. 8 is over $104 billion in the first 10 years, 
or $500 billion over the next 10 years, blowing a hole in the budget 
and our fiscal responsibility, and our ability to reduce interest rates 
and protect the economy, and our ability to help all people who want to 
be able to retire with a strong social security, being able to 
modernize Medicare with prescription drugs and provide needed 
educational assistance for those that want to climb up the ladder, and 
provide health care for all of America's children.
  We are not going to have that opportunity because, according to the 
Joint Economic Tax Committee, it estimates that only 2 percent of all 
estates will pay estate taxes, and only 3 percent of that 2 percent are 
family-owned businesses, 776 family businesses and 642 family farms. 
For that, we are mortgaging everyone's future.
  The Rangel substitute provides a serious consideration of immediate 
reforms, where the bill that is being proposed now, we would have to 
wait until 2010 before any family business would be able to take 
advantage of that.
  So this is a good substitute and it does it across-the-board. It does 
not mortgage our country's future.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas (Mr. Sam Johnson), a highly distinguished and respected member of 
the Committee on Ways and Means.
  (Mr. SAM JOHNSON of Texas asked and was given permission to revise 
and extend his remarks.)
  Mr. SAM JOHNSON of Texas. Mr. Speaker, I ran across an article out of 
the Dallas News this morning. I just have to tell Members about this.
  David Langford, who is executive vice president of the Texas Wildlife 
Association, said, ``Since 1851, my family has worked the land in the 
Texas Hill Country. Through ups and downs of the past 148 years, we 
have run flour mills, farmed, ranched, and offered hunting and fishing 
opportunities.
  ``Our land also serves as a habitat for many species of birds. . . . 
As a result, my family and I consider ourselves stewards of precious 
natural resources.
  ``But as is the case for much of the wildlife habitat in this 
country, the estate tax threatens to tear it apart. The need to pay 
large estate tax bills often forces families to sell or develop 
environmentally sensitive land. The estate tax is the No. 1 destroyer 
of wildlife habitat in this country. . . .
  ``But for those of us who are stewards of wildlife habitat, the 
argument goes much deeper than the issue of business and money. Yes, 
families suffer financially,'' and his did. ``When wildlife habitats 
disappear, they disappear forever. We aren't a bunch of fat cats trying 
to hoard our assets. We are private citizens trying to preserve an 
irreplaceable resource for the enjoyment and benefit of generations to 
come.''
  Mr. Speaker, I think most Americans agree that we need to get rid of 
this. Americans simply do not believe the IRS ought to operate a toll 
booth on the road to heaven.
  Enough is enough. It is time to repeal the taxes on our American 
values. It is time to bury the death tax, giving a new birth of freedom 
to the next generation of farmers, ranchers, and small businesses.

             [From the Dallas Morning News, Nov. 10, 1999]

                Estate Taxes Threaten Wildlife Habitats

                          (By David Langford)

       For many of us trying to preserve and protect our wildlife 
     habitat, the federal estate tax is a deadly predator.
       Since 1851, my family has worked the land in the Texas Hill 
     Country. Through the ups and downs of the past 148 years, we 
     have run flour mills, farmed, ranched and offered hunting and 
     fishing opportunities.
       Our land also serves as a habitat for many species of 
     birds, including two endangered migratory songbirds the 
     golden-cheeked warbler and the black-capped viero. As a 
     result, my family and I consider ourselves stewards of 
     precious natural resources.
       But as is the case for much of the wildlife habitat in this 
     country, the estate tax threatens to tear it apart. The need 
     to pay large estate tax bills often forces families to sell 
     or develop environmentally sensitive land. The estate tax is 
     the No. 1 destroyer of wildlife habitat in this country.
       Although we have managed to hold our land together, it 
     hasn't been easy. Before my mother died in 1993, we did 
     everything we could to protect our family's land. Like 
     millions of other family businesses, we paid accountants, tax 
     attorneys and estate planners to help manage our assets in 
     ways to avoid the tax, but it still came to this.
       In order to pay the estate taxes and keep the land together 
     when my mother died, we had to sell almost everything she 
     owned, including her home. My wife and I had to sell nearly 
     everything we owned, including our home, and move into a two-
     bedroom condominium. We also had to borrow money for 35 years 
     from the Federal Land Bank.
       Because the value of the land has increased since 1993, if 
     we were killed in a car accident tomorrow, my children would 
     owe more inheritance taxes than the amount I originally had 
     to borrow to pay mine. But that isn't the end of the story. 
     Not only would they pay more taxes than me, but they still 
     would inherit my 35-year note that they would have to 
     continue to pay.
       Could my children then keep the land? The short answer is 
     no. It probably would become a subdivision. Like thousands of 
     other hard-working, middle-class families, our children and 
     grandchildren would be at the mercy of the punishing estate 
     tax, which demands up to 55 percent of their assets at the 
     time of death. They simply don't have the cash.
       Private land stewards all over the country are being 
     ravaged by the estate tax. Taxpaying citizens are being 
     driven off the land. What is accomplished by breaking up 
     natural habitats? The benefit to the federal government is 
     negligible. The estate tax raises barely more than 1 percent 
     of federal tax revenue. Many economists have concluded that, 
     what you consider the revenue lost from tax avoidance 
     strategies, the estate tax contributes minimal revenue to the 
     federal budget.
       Congress has an opportunity to repeal the death tax or at 
     least reduce its crushing rates. No other act of Congress 
     this year could provide more help to family-owned businesses.
       But for those of us who are stewards of wildlife habitat, 
     the argument goes much deeper than the issues of business and 
     money. Yes, families suffer financially mine certainly has 
     but the real loss is one that affects the entire country. 
     When wildlife habitats disappear, they disappear forever. We 
     aren't a bunch of fat cats trying to hoard our assets. We are 
     private citizens trying to preserve an irreplaceable resource 
     for the enjoyment and benefit of generations to come.
       David K. Langford of San Antonio is executive vice 
     president of the Texas Wildlife Association.

  Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from 
Massachusetts (Mr. Olver).
  Mr. OLVER. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  Mr. Speaker, small family farmers and business owners in my district 
deserve tax relief. I support the Democratic substitute legislation 
that excludes up to $4 million for couples owning farms or small 
businesses. But this estate tax bill really should be titled ``the 
Billionaire Protection Bill.''
  This Billionaires Protection Act is a terrible solution to an easily 
remedied

[[Page H4138]]

problem, but it does tell America exactly what Republican priorities 
really are. Before anything else, the Republican leadership would give 
a huge, reckless, and dangerous backloaded tax cut, more than half of 
which goes to the 60,000 wealthiest families among our 60 million 
families.
  Do Republicans really believe that the Bill Gates, the Steve Forbes, 
the John Corzines, need $25 billion of tax cuts every year? Does anyone 
listening and watching today believe they need $25 billion of tax cuts?
  The Republican leadership would give this multi-billion dollar tax 
cut before limiting class size to 18 for more than 3 million children; 
before establishing a prescription drug benefit in Medicare for 13 
million American senior citizens who cannot afford the expense of drug 
coverage; before raising the minimum wage for millions of Americans 
working full-time for less than $11,000 per year; before paying down 
the national debt, so interest rates will go down for all American 
homeowners; before extending social security so that our generation and 
our children's generation will have a secure base for retirement.
  It is a stunning revelation to know that the Republicans' last 
priority is a huge tax cut for the super rich. Vote for the substitute 
and against this give-away.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. Kolbe). The Chair would remind all 
Members participating in debate to direct their remarks to the Chair 
and not to the viewing audience.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Kentucky (Mr. Lewis), another distinguished and respected member of the 
Committee on Ways and Means.
  Mr. LEWIS of Kentucky. Mr. Speaker, many of those on the other side 
of this debate that are against this tax relief keep talking about a 
$50 billion cost to the government. It is going to cost the government.
  My question is, whose money is this? It is the farmer down in 
Kentucky and the States across the country that get up every morning 
before the sun comes up, and that never get in from the fields many 
times until way after the sun has gone down, that put in 40, 50, 60 
years of their life of hard work in the fields to provide something for 
the next generation, for their sons and for their daughters.
  It is their money. They are the ones who are working to earn it, to 
provide something for their heritage, something that will allow the 
farm produce in this country to continue.
  As my friend, the gentleman from Illinois (Mr. Weller) mentioned a 
little while ago, urban sprawl is eating up the farmland because the 
hard work of farmers is going back into taxes. That is totally unfair.
  Mr. CARDIN. Mr. Speaker, it is my pleasure to yield 1 minute to the 
gentleman from Texas (Mr. Edwards).
  Mr. EDWARDS. Mr. Speaker, if being fiscally irresponsible and unfair 
to middle class American families were crimes, passing this bill would 
be a felony.
  Under this bill, 90 percent of American families will get nothing, 
not one dime, except for a larger national debt. But one-thousandth of 
1 percent of America's richest will get billions in tax cuts.
  Republicans are saying on one hand, we cannot afford to get soldiers 
off of food stamps, but let us give billionaires a massive tax cut. 
They are saying, we cannot afford to keep our health care promises to 
veterans and military retirees, but we can afford a $50 billion tax cut 
to the wealthiest 2 percent of Americans.
  Republicans say, we cannot afford decent Medicare prescription drug 
programs for seniors, we cannot afford to enforce nursing home 
standards, we cannot afford to protect struggling rural hospitals from 
Medicare cuts in this Congress, but we can afford to give Bill Gates, 
Ted Turner, and Steve Forbes millions or billions in tax cuts.
  The Democratic substitute values all Americans, not just a privileged 
few, by protecting family farms and businesses while paying down the 
national debt. Those are America's values.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Illinois (Mr. Manzullo).
  Mr. MANZULLO. Mr. Speaker, I was there when the auctioneer's gavel 
fell and sold half of the family farm of a couple that I represented in 
Ogle County, Illinois, as their kids sat there and went.
  Let us not talk about the Bill Gates and the Steve Forbes, let us 
talk about those people, farm people losing their farms because 
government wants more money to spend on more programs. It is not Steve 
Forbes.
  Let us talk about the Cross family, dealing with the death of the 
grandmother and then the death of their mother, trying to desperately 
hang onto the family farm. These are not rich people. They are a small 
percentage of people, but they are real people with real names and real 
auction sales that deprive their children of the ability to carry on 
the family farm. Those are the names.
  Mr. CARDIN. Mr. Speaker, it is my pleasure to yield 1\1/2\ minutes to 
the gentleman from Mississippi (Mr. Taylor).
  Mr. TAYLOR of Mississippi. Mr. Speaker, what is interesting today is 
what is not being said. Our Nation is $5.7 trillion in debt. Five 
trillion dollars' worth of that debt was acquired by Congress in our 
lifetimes.

                              {time}  1100

  Most of it since 1980. We are squandering a billion dollars a day on 
interest on that debt.
  The Joint Chiefs of Staff testified that we have a $100 billion 
shortfall in our military. The Shows bill which would provide relief to 
our veterans and military retirees has 300 cosponsors, but the 
Republican leadership will not bring it to the floor because they say 
we do not have $5 billion a year to cover that cost.
  So I have to admit I find it a bit unusual that the Republican 
leadership can find $50 billion a year to give the wealthiest 2 percent 
of all Americans a free ride on this. I hope someone will explain that.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Nebraska (Mr. Terry).
  Mr. TERRY. Mr. Speaker, as a cosponsor, I rise in support. This act 
is about more than economic policy or numbers. It is about fairness. It 
is about family preservation. We are trying to protect their heritage 
and their culture.
  In Nebraska, family farms date back to the great-great-grandparents 
who were pioneers, yet these taxes force smaller farms to sell to the 
Ted Turners of the world. And in Omaha, my hometown, second and third 
generation family shops like print shops or the Hispanic grocery store 
where they migrated here 40 years ago to live the American dream which 
were built with the family's sweat and the toil and the sacrifice, must 
be sold now upon the death of the father or the mother to pay the death 
taxes.
  This act is about fairness. It is about preserving family history and 
culture. Please preserve this family culture. Vote for this bill.
  Mr. CARDIN. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Texas (Mr. Turner).
  Mr. TURNER. Mr. Speaker, I come from a district where the average 
household income is just over $21,000. We know that less than 2 percent 
of all American families ever owe an estate tax. I can say that in the 
second district of Texas, it is less than that.
  H.R. 8 targets the richest 2 percent of the families in the country 
and if it were to pass, it would amount to a $2 billion to $3 billion 
tax break just for the 400 richest Americans. It would cost over $50 
million a year when fully phased in.
  Mr. Speaker, I say it is simply not right to give the very richest 
billionaires a $50 billion tax break while everyone else is left to 
figure out how to pay off the national debt and how to save Social 
Security.
  As the chart I have to my right indicates, the Democratic substitute 
gives even more relief to the smaller estates. In fact, the Democratic 
alternative gives the greatest tax relief to the smallest estates at a 
fraction of the cost to the Treasury.
  Look here, a $2 million estate of the husband who dies and the family 
worth $4 million, under House Bill 8, that family owes $229,800 in 
estate taxes; under the Democratic substitute, there is no estate tax 
due. That is if we have a family farm or small business. If we do not 
happen to be a family farmer or have a small business, we still get 
more relief under the first 5 years under the Democratic plan than 
under H.R. 8.

[[Page H4139]]

  Mr. Speaker, I say this is the best plan. It is fiscally responsible 
and gives the greatest tax relief to the smaller estates.

           COMPARISON OF ESTATE TAX OWED ON $2 MILLION ESTATE
------------------------------------------------------------------------
                                                 House bill   Democratic
                     Year                            8        substitute
------------------------------------------------------------------------
Small business or family farm:
    2001......................................     $229,800            0
    2002......................................      229,800            0
    2003......................................      222,800            0
    2004......................................      208,800            0
    2005......................................      188,200            0
All others:
    2001......................................      491,300     $316,000
    2002......................................      491,300      316,000
    2003......................................      456,800      316,000
    2004......................................      375,800      316,000
    2005......................................      303,700      316,000
------------------------------------------------------------------------
Source: Congressional Research Service.

  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
California (Mr. Calvert).
  Mr. CALVERT. Mr. Speaker, I rise today as a former small business 
owner, a family business, and a strong supporter of H.R. 8, the Death 
Tax Elimination Act. This bill finally phases out the Federal estate, 
gift, and generation-skipping transfer tax commonly referred to as the 
``death tax.''
  Small businesses are a foundation of the American dream. My father, 
after he served in World War II, started a small coffee shop chain, 
started with one restaurant and built it up. My father passed away and 
as a family, we are facing this estate tax, as many families in this 
country face this tax. It is unfair, it is un-American, and we have an 
opportunity to end this tax today.
  Mr. Speaker, it is disgraceful that we continue this practice, and I 
am looking forward to a vote today that will finally start us down the 
road to ending this tax which hopefully will be signed into law.
  Mr. CARDIN. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Massachusetts (Mr. Capuano).
  (Mr. CAPUANO asked and was given permission to revise and extend his 
remarks.)
  Mr. CAPUANO. Mr. Speaker, there are a couple of questions that have 
been raised in my mind since I have been listening to the debate. I 
guess if this tax is a bad tax because everybody earned the money, that 
is true. That is true for every single tax we have. Of course Americans 
earn the money. It is no different here than in the income tax or sales 
tax or any other tax.
  If the argument is valid, it is valid for every tax. Let us just get 
rid of them all and base this country's entire economic system on 
gifts. It is not going to happen, my colleagues on the other side of 
the aisle do not propose it, so the argument does not hold water.
  I also hear today about how difficult it has been on a few 
individuals. Of course, every system has problems. In general, though I 
have also heard many comments about different businesses that are 
second generation, third generation, fourth generation businesses. How 
did they make it? How did they get through the estate tax if it is so 
bad?
  Let us tell the truth. The Democratic proposal deals with the 
problems that are on the table. Everyone here wants to deal with them. 
It will cut from 2 percent. If the Democratic proposal is adopted, it 
will be 1 percent. We take almost half of the people today and not tax 
them at all. On top of that, when we are finished if the Democratic 
proposal is passed, the average estate, the average estate that would 
be taxed would be worth $3.5 million. And they would not be taxed at 55 
percent. Anybody who knows anything about taxation knows the difference 
between marginal taxation and effective taxation. The effective tax 
rate, the thing that is really paid by people, currently is about 20 
percent. It is not 50 or 55 percent as everyone keeps saying because 
that is a nice number to use. But it does not mean a thing. It is 20 
percent.
  If the Democratic proposal is passed, it would be 16 percent. The 
Democratic proposal would still leave the average taxpayer with $2.7 
million of that 1 percent of people.
  Mr. ARCHER. Mr. Speaker, I yield the balance of our time to the 
gentleman from California (Mr. Cox) a member of the Republican 
leadership.
  Mr. COX. Mr. Speaker, when I first introduced legislation to repeal 
the death tax in 1993, the Democratic leader was seeking to increase 
death taxes. But slowly but surely over four congresses, we have put 
together a consensus of Democrats and Republicans in this body and the 
other body behind the simple notion: the death tax, even though it is 
intended to soak the filthy rich, does not really fall on them. It 
falls on low-wage workers.
  Mr. Speaker, people who fall in the category of the top 2 percent 
richest Americans, names that we have heard during this debate like Ted 
Turner or Bill Gates, will not benefit from the passage of this 
legislation because they will not pay the death tax. To a certainty, 
the one person who will not pay the death tax is the rich dead person. 
But beyond that even those who survive, through estate planning, 
through all manner of complicated trusts and avoidance schemes, not to 
mention lifetime gifts, successfully avoid most of the burden of this 
tax.
  The real burden of this tax falls on the low-wage worker, the woman 
who works for a business or a farm or a ranch that is family owned, 
because every day she does not know what happens when the founder dies. 
If part of that business has to be sold off or all of it has to be sold 
off to pay the tax man as so often happens, then people lose their 
jobs. Many more people than there are dead rich persons at whom this 
tax is aimed. And when they lose their jobs, their tax rate is 100 
percent. It is for those people that we are passing this legislation 
today.
  In California, we put this question to a vote of the people. Even 
though the left raised the battle cry that this was a tax break for the 
rich, nearly two-thirds of Californians voted to repeal our death tax 
in its entirety because they understood where the real burden of this 
tax falls. It is the right thing to do today for the working people of 
America, and I congratulate the leadership of this Congress, the 
gentleman from Texas (Chairman Archer), and all of the Democrats and 
Republicans who have come together to make this happen. We hope that 
this time the President will sign it into law.
  Mr. CARDIN. Mr. Speaker, I yield the balance of our time to the 
gentleman from Georgia (Mr. Lewis), a distinguished member of the 
Committee on Ways and Means.
  Mr. LEWIS of Georgia. Mr. Speaker, I rise today in support of the 
motion to recommit to be offered later by the gentleman from Texas (Mr. 
Doggett). The motion simply says that section 527 political 
organizations that fail to disclose their donors will be subject to the 
gift tax.
  It is time to fix our broken system of financing elections. This 
motion is an important step toward that goal. It would close a huge 
loophole by requiring simple disclosure by secretive political 
organizations and groups. The American people have a right to know. 
They have a right to know who is funding political campaigns in this 
country. They have a right to know who is trying to influence their 
votes. The American people have a right to a free and open election 
process.
  Mr. Speaker, it is time to close this loophole. It is time to get rid 
of the secrecy. It is time to fix this mess.
  The other body had the courage and voted with raw courage on 
yesterday to close this loophole. It is time for the House to do the 
same. I urge all of my colleagues to support the motion to recommit.
  Mr. SANFORD. Mr. Speaker, I rise in support of Chairman Archer's 
efforts to reform the estate tax. And I say reform, rather than repeal, 
because at the heart, that's what I think we're talking about here. I'm 
sure Chairman Archer would disagree emphatically with my point. But 
given the way our political process works, I think that today's vote 
represents the starting point in negotiation over the estate tax. By 
staking out a position of repeal, as it works its way through the 
political body, what we're really talking about is change. And the 
question I think we all need to ask ourselves is to what degree. While 
I am in favor of this vote because it stakes the position of the need 
for change, the reason I don't think that I would ever be in a position 
to support total repeal of the estate tax is tied to three things: 
history, the value of work and the belief in meritocracy, and, finally, 
the power of compound interest.
  When you look through the pages of history, you see that anytime 
there's been extreme disparity of wealth, you've seen political 
problems. In short, the Banana Republics of South America are 
demonstrative of the fact that a few families holding all the wealth 
doesn't lend itself toward democratic rule. In fact, if you stop and 
think about it, would it be good for

[[Page H4140]]

our form of government, if out of the 270 million people that make up 
America, 99 percent of the wealth was held by four families? I think 
undoubtedly, most people would say no, not a chance. And that 
illustrates the point that I think intuitively all of us know--that 
extreme wealth concentration isn't good for our form of government.
  Two, I'd say there's a real value to work and meritocracy. I think 
that one ought to put on their jeans and go to work. It's good for the 
individual and it's good for society as a whole. In fact, Republicans 
have repeatedly made that very argument when they talk about welfare 
recipients. Our Founding Fathers were very deliberate about not having 
kings and queens, and yet if you have a couple of families that can 
hand on huge levels of wealth, tax free, generation after generation, 
what you develop is an aristocratic class that does nothing more than 
eat from silver spoons and play polo. I think the reverse would be good 
to have a merit-based system, wherein one can go out and earn as much 
money as they're able over the course of their lifetime with very 
little from the standpoint of government regulation or government 
taxation interfering with those efforts. Beyond a certain point though, 
families ought to be brought back to a neutral starting zone, with each 
new generation given that shot at making it to the top. I say that as 
one who's voted to cut virtually every form of government spending. 
Unfortunately, Congress as a whole is not willing to do that, and we 
have to pay for those government services that people so consistently 
vote for around this place. I'd rather not see the burden on the 
shoulders of people working and striving to develop new things. I'd 
rather see that, again, at the end of the day after one has succeeded, 
without government taxing them heavily on their rise to the top.
  Which brings me to my third point, the power of compound interest. I 
do think the estate tax needs to be substantially reformed, and I'm 
talking about a very large limit here. One ought to be able to hand off 
perhaps $250 million or $500 million tax free to their children, should 
they so choose. But you shouldn't have a Bill Gates level of wealth 
that's $50 billion handed tax free to the next generation. For this 
family, within a couple of generations, compound interest could 
concentrate perhaps a trillion dollars of net worth.
  So in the end that's where I am. Let's substantially repeal the 
estate tax; let's reform it mightily, raising the limit in excess of 
$100 million of tax free inheritance, to be handed on from one 
generation to the next. But let's not completely eliminate it, because 
extreme concentrations of wealth handed tax free from one generation to 
the next is not only bad for the individuals in question, but certainly 
bad for our system of government.
  Ms. PELOSI. Mr. Speaker, yesterday we began debate on a bad Labor/
HHS/Education Appropriations bill, a bill that cuts $2.9 billion from 
education services; cuts $1.7 billion from labor with cuts to workforce 
development and safety investments; and cuts more than $1 billion from 
critical health programs. And next week we will be forced to vote on 
this bill that undermines so many of our nation's priorities.
  Why? Because the Republican House leadership passed a bad Budget 
Resolution that puts tax cuts for the wealthiest Americans above 
investments to promote America's education, workforce, and health 
services. Their $175 billion tax cut exceeds the projected budget 
surplus and requires deep cuts in non-defense discretionary 
appropriations.
  And here we are again, voting on a measure that would provide over 
$50 billion to the wealthiest 2 percent of taxpayers. How much is 
enough? When will Republicans be satisfied with the amount of money 
they have given to the wealthy, and turn their attention to the 
majority of Americans who want a good education, a strong work force, 
and a healthy future?
  This bill will cost $50 billion per year when fully phased in. This 
monstrous hole in the federal budget will undoubtedly translate into 
cuts from areas that the American people care about, just as the 
proposed $175 billion Republican tax cut translated into cuts in 
yesterday's proposed Labor/HHS/Education Appropriations bill.
  When we prioritize tax cuts over health, education, and labor, we 
make sacrifices, and these sacrifices affect everybody. The repeal of 
the estate tax does nothing for working families. Most American 
families would not receive a single dollar of tax relief from this 
bill. So I want the American people to know what they are sacrificing 
in order to provide a tax cut to the wealthiest two percent of their 
fellow citizens.
  Republicans have proposed cutting $1 billion from targeted 
investments in education to improve teacher quality and recruit new 
teachers, denying afterschool services to 1.6 million kids, and 
eliminating HeadStart assistance to 50,000 kids.
  They have also proposed cutting NIH $439 million below current 
services and cutting $16 million from Clinton's request for battered 
women's shelters.
  These are the kinds of sacrifices that Americans are being asked to 
make in exchange for a tax cut that would give $300 billion to the 400 
richest Americans. $300 billion is enough to pay for a prescription 
drug benefit for seniors for 10 years!
  The Republican majority placed the needs of big business over working 
people yesterday by voting to once again delay the implementation of 
new ergonomics regulations which protect working people from repetitive 
motion injuries. And here they are again asking working families to 
make sacrifices so that the wealthy can reap benefits.
  Slowing our progress in health, education, and labor in order to make 
room for tax cuts for the wealthy does not fit with our national 
priorities.
  Democrats have proposed a fiscally responsible substitute that 
targets tax relief to farmers and small business. I urge my colleagues 
to support this alternative.
  Mr. CROWLEY. Mr. Speaker, hard working Americans should not be forced 
to liquidate their holdings and sell off the businesses their fathers 
or grandfathers started in order to pay their estate taxes. The estate 
tax, while only affecting a relatively small number of people, does 
harm small businesses, family farms and ranches. I am not talking about 
the wealthiest Americans; I am talking about hard working Americans.
  This relief needs to be immediate. While I support the principles of 
H.R. 8, it does not help hard working families now, or even next year, 
it will not help 10 years from now. Additionally, it will take from our 
surplus that could be spent on shoring up Social Security, implementing 
a prescription drug benefit for seniors and improving education. H.R. 8 
really helps the wealthiest Americans.
  In today's economy, one million dollars does not make a millionaire. 
On paper, a family business may be worth six million dollars with 
property and buildings, but the family is really struggling to survive. 
The Rangel substitute addresses the inflation in our economy while 
still being fiscally responsible. The Rangel substitute increases the 
special exclusion to the estate tax to two million dollar per person. 
It provides further relief and simplifies the estate tax for this group 
by allowing any unused portion of the exclusion to be transferred to 
the surviving spouse, making the total exclusion four million dollars 
to eligible farm and small business owning couples. Importantly, the 
Rangel alternative increases the general exclusion for the estate tax 
next year from $675.000 to $1.1 million. H.R. 8 would take ten years to 
make this increase.
  Additionally, we all agree the top marginal tax rate of 55% is too 
high--taking away more than half of any estate. The Democratic 
substitute lowers marginal tax rates by twenty percent across the board 
in combination with converting the federal estate tax credit for state 
death tax credit into a deduction.
  I believe the Rangel substitute will provide relief to the small 
businesses in my district as well as farms and ranches across the 
country. At the same time, it allows us to retain our budget surplus to 
help Social Security, Medicare and Education.
  I support the Rangel alternative. I oppose the fiscally irresponsible 
H.R. 8 and urge my colleagues to vote in support of the Democratic 
alternative.
  Mr. FRANKS of New Jersey. Mr. Speaker, today, with my support, the 
House passed legislation (H.R. 8) to eliminate the Death Tax.
  For too long, exorbitant tax rates have made it difficult for 
Americans to pass their savings onto their children, and for small 
businessmen and farmers to keep their enterprises within the family.
  That's why I cosponsored and voted in favor of the Death Tax 
Elimination Act (H.R. 8), which would phase out the estate and gift tax 
over a period of 10 years.
  It is my hope that phasing out the death tax will make it easier for 
individuals and families to accumulate savings for future generations.
  In addition, during debate on this important legislation, a motion 
was offered to address another important issue--campaign finance 
reform. I supported this motion.
  Congress's failure over the years to address the issue of campaign 
finance reform hurts all of us. It undermines public confidence in this 
institution and casts a cloud over every action we take in this House.
  I have been actively fighting for campaign finance reform in this 
House for a number of years--from authorizing my own Independent 
Commission Bill to supporting a ban on soft money through Shays-Meehan 
to supporting today's motion to close the 527 loophole.
  Recently, there has been an increase in anonymous campaign 
expenditures by third parties. Many of these organizations are 
classified by Section 527 of the tax code. These ``527'' organizations 
are currently free to participate in our electoral process, but are not 
required to disclose to the American voters from where their funds 
originate.
  To establish disclosure requirements for individuals and 
organizations who wish to take

[[Page H4141]]

an active role in affecting the outcome of federal elections is just 
plain common sense. Individuals and organizations who strongly believe 
in an issue or a candidate and are willing to back them up with their 
financial resources should not be allowed to hide behind a loophole.
  Congress must act an legislation requiring disclosure for any group 
who wishes to participate in federal elections in order to help build 
greater public confidence in the integrity of our federal electoral 
process.
  Mr. ROEMER. Mr. Speaker, I rise in support of H.R. 8, which provides 
for the elimination of the federal estate tax. By removing one of the 
most unfair, complicated and inefficient provisions on the tax books, 
we can provide critical tax relief to our families, small businesses 
and farms. I strongly believe that a person who works hard, pays taxes, 
and saves money should not be penalized with an onerous tax upon his or 
her death. Every American deserves to know that their heritage, 
livelihood and the sum of their life's work will be passed on to their 
children.
  The estate tax undermines the traditional principles of our nation--
hard work, savings, and fairness. There are too many cases of family-
owned businesses and farms in Indiana that have been forced to sell 
their estates because it was too expensive to pay the estate tax. More 
than 70 percent of family-owned businesses are not passed on to the 
next generation, and 87 percent do not make it to the third generation. 
Even as the estate tax creates such severe unintended consequences, it 
does not even succeed at its intended purposes. the estate tax brings 
in less than 1.4 percent of total federal revenues, but enforcement of 
the tax costs the government 65 cents for ever dollar it raises. This 
is a waste and simply unfair to hard-working American taxpayers.
  I also support the Democratic alternative, which provides even more 
relief to small businesses and farmers by providing targeted and 
immediate tax breaks. For example, the Democratic alternative allows a 
married couple to pass on their family farm or small business intact 
with no estate tax whatsoever if it is worth up to $4 million. Because 
the Republican bill is phased in over ten years, a couple passing on 
their farm or small business in the near future would avoid more tax 
under the Democratic substitute. It also lowers estate tax rates 20% 
across the board. This alternative is a fiscally sensible alternative 
that targets relief to farmers and small businesspeople while 
protecting our ability to pay down the national debt and shore up the 
long-term future of Social Security and Medicare.
  Mr. Speaker, since the Democratic alternative is not expected to be 
passed by the House, I will vote for H.R. 8 because I do not support 
the status quo as it concerns the estate tax. Hard working American 
taxpayers deserve a change now, and for these reasons, I strongly 
encourage my colleagues to support this legislation.
  Mr. KIND. Mr. Speaker, I rise today in opposition to H.R. 8, the 
Death Tax Elimination Act of 2000. The federal estate tax has come 
under a great deal of scrutiny because of its economic effect on family 
farms and small businesses. I support the effort to protect these farms 
and businesses but, unfortunately, H.R. 8 does not effectively target 
small businesses and farms. Rather, it would enable the wealthiest 2 
percent in our country to pass vast fortunes to their heirs without a 
penny of tax, while working families are taxed on every dollar they 
earn. Further, Congress would be passing a greater share of the burden 
of saving Social Security and Medicare and paying off the $5.7 trillion 
national debt to all American children.
  H.R. 8 would initially reduce and then fully repeal the federal 
estate and gift tax over a 10-year period. This bill would cost $28 
billion over five years and $105 billion over ten years. The full 
repeal, however, does not take effect until 2010. In that year, the 
Congressional Budget Office estimates that estate and gift tax will 
generate nearly $50 billion. As a result, the revenue loss in the 
second ten-year period explodes to more than $500 billion at a time 
when our country can least afford it as baby boomers will be retiring 
and Social Security shifts from cash surplus to a deficit.
  It is important to recognize when considering this full repeal of the 
estate tax relief that only 2 percent of decedents have enough wealth 
to be subject to the estate tax at all under current law. Further, of 
the 2 percent of Americans subject to the estate tax, only 3 percent 
are small business people or farmers. Additionally, only 6 in 10,000 
American estates are farms or small businesses subject to estate tax.
  I believe that we must provide relief to family farms and small 
businesses and that is why I support the substitute offered by 
Representative Rangel. This substitute would provide fiscally 
responsible estate tax relief to small business and farm owners. 
Specifically, it would immediately raise the special exclusion from the 
estate tax from $675,000 to $4 million for a couple owning a farm or 
small business and would lower the estate tax rates by 20 percent 
across the board.
  Our current strong economy has begun producing surplus federal 
revenues, and, as you might imagine, there is no shortage of ideas for 
``using'' the surplus. I am in favor of addressing negative effects of 
the estate tax, as evidenced by my past votes, but I also believe we 
should give priority to using these surplus funds to save Social 
Security and Medicare and pay down the $5.7 trillion National Debt. 
Surplus funds allow us to pay down the principal on this burdensome 
debt, thus reducing the annual interest payments which amount to 
approximately $250 billion annually. In fact, Federal Reserve Chairman 
Alan Greenspan stated, ``Saving the surpluses--if politically 
feasible--is, in my judgement, the most important fiscal measure we can 
take at this time to foster continued improvements in productivity.''
  A lower national debt would help reduce interest rates, resulting in 
tremendous cost savings for all American families who make credit card, 
car, mortgage, and loan payments. Lower interest rates will also reduce 
the cost of capital for businesses, allowing for more investment and, 
therefore, more job creation.
  Mr. Speaker, I urge my colleagues to vote against H.R. 8. Any tax cut 
must be done in a fiscally responsible manner, and not derail the 
opportunity we have to reduce our large national debt and prepare for 
our future obligations to our aging population.
  Mr. Speaker, unfortunately due to a family obligation, I missed 
today's roll call votes. On roll call vote number 252, had I been 
present, I would have voted ``yea.'' On roll call vote number 253, had 
I been present, I would have voted ``yea.'' On roll call vote number 
254, had I been present, I would have voted ``nay.''
  Ms. KILPATRICK. Today, I rise in strong and stringent opposition to 
H.R. 8 which will repeal the estate tax. The majority, as it did 
earlier this year, is pushing legislation that will benefit an 
important, but small portion of the American population. I object to 
this legislation because it is taken up at a time when the American 
people have, over and over, indicated that their priorities--their 
major concerns, are the ability of our nation's children to receive a 
quality affordable education and the ability to receive adequate and 
affordable healthcare and a reasonable minimum wage. The repeal of the 
estate tax is an issue that affects only 2 percent of all estates and 
will cost the treasury $50 billion when it is fully implemented.
  Last year, the Republican party failed to pass its tax plan. A plan 
that would decimate the budget that we have worked so diligently to 
balance. The Republicans have resorted to a new approach designed to 
pass their tax cut piece by piece, instead of the broad sweeping tax 
cut they earlier proposed.
  The Joint Committee on Taxation estimates that the repeal of the 
estate tax will cost the U.S. Treasury $28.3 billion over five years, 
$100 billion over 10 years and $50 billion every year after 2011. In 
addition, the Children's Defense Fund points out that:

       If the same funding were instead invested in children, 
     millions of children throughout America would get a fairer 
     and healthier start in life. Instead this bill ignores the 
     needs of 13.5 million children living in poverty to give only 
     the wealthiest Americans a huge tax cut. In fact, 100% of the 
     benefits from an estate tax cut will go to people in the top 
     5% income group, those earning at least $130,000 a year, with 
     over 90% of the estate tax going to those in the top 1% 
     income group, those earning at least $319,000 a year.

  If we are truly concerned about American small business owners and 
farmers who are most hurt by the estate tax, we should support the 
Democratic substitute. The Democratic substitute will effectively 
create a $4 million exclusion per family for farms and closely-held 
business. The substitute would result in a total cost of $22 billion 
over ten years instead of nearly $105 billion over 10 years. The 
substitute also provides an immediate, 20 percent across-the-board 
reduction to the estate and gift tax rates, with the maximum estate and 
gift tax rates reduced from 55 percent to 44 percent.
  I say to my colleagues who argue that their concern is with the 
American people, where is the legislation concerning healthcare? Where 
is the legislation concerning the education of our children? Where is 
the legislation addressing those who earn an inadequate minimum wage? 
Why are we standing here today considering a bill that only affects the 
wealthiest 2 percent of the American people? These are the questions 
that this body must address. If, however, we must address the question 
of the estate tax, let's do so in a manner that addresses those most 
hurt by the estate tax and support the Democratic substitute.
  Mr. BLUMENAUER. Mr. Speaker, I was not here to vote today on 
eliminating the inheritance tax. Instead, I am on the other side of the 
continent, celebrating my daughter's college graduation with family and 
friends. Frankly, I would have been embarrassed to be participating in 
today's debate, which is nothing

[[Page H4142]]

more than a cynical political sideshow staged by the Republican 
leadership in their appeal for the support of some of the most 
spectacularly wealthy people in the country at the expense of people 
who look to the federal government for help.
  The issue before us is straightforward. I believe, as do the majority 
of my colleagues, that no one should be forced to sell a family 
business, farm, woodlot or closely held business, simply because a 
family member or principal owner has died. Such sales are often 
economically disruptive and damaging to the family involved; certainly, 
they do nothing to make our communities more livable.
  There is a way to solve what is a very real problem faced by some 
contractors, farmers, woodlot and other business owners. We can defer 
the inheritance tax permanently, so long as the business remains in the 
family or closely-held partnership. I don't care how much the business 
is worth--if the owners don't want to sell, they shouldn't have to. We 
should also increase the exemptions in the inheritance tax, and adjust 
it for inflation, just as we did with the income tax. These three steps 
would solve the problem for every person who has contacted me, and 
would be enacted by a large majority and signed into law by the 
President.
  The bill we are considering, however, is far different. Even though 
it will not be enacted into law, the legislation offers clear insights 
into the thinking and priorities of the leadership of the Republicans. 
It would offer enormous benefits to a few hundred of the wealthiest 
people in America, whose billions in unrealized capital gains will pass 
to their heirs without ever having been taxed, but it ignores the 
pressing needs of hundreds of millions of other Americans. What about 
the 11 million American children who have no health insurance? What 
about their families, working hard, but still struggling on income of 
ten or fifteen thousand dollars a year? What about the elderly, who 
can't afford to buy the prescription drugs that would so improve the 
quality of their lives? What about the students with special 
educational needs? This Congress is about to consider a budget that 
shortchanges them once again.
  It is scandalous that men and women who served their country may not 
receive the health care they were promised. It is damaging to our 
future that many of today's college graduates--the ones we will depend 
on to shore up Social Security--are beginning their careers staggering 
under a crushing load of student debt.
  This Congress looks at all these problems and sees nothing of 
interest or importance. The problems of those most well-off are far 
more consuming--and far more rewarding to pretend to solve. In the end, 
this bill will be vetoed and America's small businesses will be right 
back where they started.
  I came to Congress to help American families be safe, healthy and 
economically secure. Allowing family businesses and closely held 
corporations to stay in family hands would clearly help this effort. I 
am not opposed to helping solve the problems of the most well-off in 
society. At a minimum, however, we should pay equal attention, expend 
equal effort, and invest as much in those Americans who are struggling 
even in these best of times.
  Mr. MOORE. Mr. Speaker, I rise in support of H.R. 8, the Death Tax 
Repeal Act. I have long been a supporter of providing estate tax relief 
to American families, small business owners, and farmers who have 
worked their entire lives to transfer a portion of their estates upon 
their death.
  While H.R. 8 is the vehicle that the House leadership wishes to 
pursue to achieve this goal, I believe there is a better way to provide 
relief and maintain our commitments to paying down the national debt, 
protecting Social Security and Medicare, and other priorities. This is 
why I will also be supporting the substitute to H.R. 8.
  The alternative will increase the estate tax exclusion for family-
owned farms and businesses to $4 million and simplify the rules to 
allow a surviving spouse to automatically receive any credits that were 
applied to the estate of the deceased. It will also increase the 
unified exemption to $1.1 million and reduce estate tax rates by 20 
percent. All of these changes will be made immediately, instead of 
delaying relief to the small businesses and family farmers who truly 
need relief for several years as H.R. 8 would do.
  H.R. 8 does not repeal the estate tax for 10 years; rather, it shaves 
the marginal tax rates by a total of 14.5 percent over 5 years, 
delaying estate tax relief to the small businesses and farms that truly 
need it. H.R. 8 uses a phase-in period to hide its real effects. While 
the first 10 years cost only $104 billion, I have deep concerns about 
the costs of this legislation outside the 10 year budget window. They 
explode to $50 billion per year, or $500 billion in the second ten 
years.
  Mr. Speaker, in February 2000, I received a score from the Joint 
Committee on Taxation for H.R. 3127, a bill I introduced to provide 
estate tax relief by immediately increasing the exclusion to $3 
million. I anticipated that this score would have less budgetary 
consequences than the vetoed estate tax provisions in last year's $792 
billion tax package. Joint Tax scored the estate provisions in that 
bill, which tracks closely with today's bill at $65 billion, while they 
scored my bill at $211 billion. This perplexed me; and when I wrote 
Joint Tax back for an explanation, they replied: ``your bill provides 
substantially more relief through fiscal year 2009 from the estate 
gift, and generation-skipping transfer taxes than the relief contained 
in Title VI of H.R. 2488.'' I have enclosed copies of these letters for 
the record.
  Simply, H.R. 8 would have the American people believe that they will 
receive immediate and substantial estate tax relief. This bill delays a 
full repeal, which will have budget implications that this country 
simply cannot afford. With over $500 billion in lost revenue, this has 
the potential to put this country back on the wrong fiscal track of 
increased deficit spending and an exploding national debt.
  Although the majority claims to support retiring the publicly held 
debt, they have begun the session by scheduling several tax bills 
funded by the projected budget surplus without giving any consideration 
to the impact that the bills will have on our ability to retire our 
$5.7 trillion national debt. These tax cuts, however, must be made in 
the context of a fiscally responsible budget that eliminates the 
publicly held debt, strengthens Social Security and Medicare, and 
addresses our other priorities.
  We can and we have cut taxes. In February, I voted for and the House 
of Representatives passed a $182 billion marriage penalty relief bill. 
In March, I voted for and the House passed a $122 billion small 
business tax relief bill, which included estate tax relief. Later in 
March, I voted for and the House passed a bill eliminating the Social 
Security earnings test. And, in April I voted for and the House passed 
a bill to repeal the telephone excise tax at a cost of over $51 
billion. Today, the House will likely pass a $104 billion estate tax 
relief bill. That brings the total tax relief approved by the House to 
date up to over $450 billion or a little more than 50 percent of the 
projected on budget surplus of $930 billion.
  I supported all previous efforts to provide tax relief because each 
has had a relatively modest cost when considered in isolation. I am 
concerned, however, that the total costs of these bills will be nearly 
as much as the vetoed tax bill, and could even be more expensive. This 
is why I intend to support the fiscally responsible substitute which 
provides immediate estate tax relief targeted to farmers and small 
businesses while protecting other urgent priorities such as paying down 
the debt and shoring up the long-term future of Social Security and 
Medicare.
  I will also support, however, final passage of H.R. 8 because it is 
the only vehicle the leadership will allow to provide estate tax 
relief. I will not obstruct that vehicle; however, I hope the Senate 
and the conference committee consider carefully compromise language 
that provides substantial and immediate relief, that is fiscally 
responsible, and that the President will sign.
  Mr. CRAMER. Mr. Speaker, I rise today in strong support of H.R. 8, 
the Death Tax Elimination Act.
  I strenuously oppose this unfair and unreasonable tax. This tax, one 
imposed on earnings and assets that have already been subject to 
income, social security, and other taxes at the federal and state 
level, is simply unconscionable.
  To begin with, the rates for this ridiculous tax, which range from 37 
percent to 55 percent, are even higher than the highest income tax rate 
of 39.6 percent. This tax is making an already difficult situation 
unnecessarily worse for our small, family-owned businesses and family 
farms. Even the most modest farm or business can easily exceed the 
current death tax exemption because of their investment in capital 
assets like land and equipment.
  Mr. Speaker, it is outrageous that today it makes more sense to sell 
a family-owned business before death rather than pass the business to 
one's heirs. These businesses are the backbone of America's economy--
creating more jobs than any other facet of our economy. We must work to 
nurture and protect these businesses, not destroy them through 
unnecessary and unfair taxes.
  Mr. Speaker, if we can't eliminate this tax--which only accounts for 
less than 1% of our overall revenue--in these times of tremendous 
budget surpluses, when can we?
  This tax cost jobs, it prevents families from passing on their 
businesses or farms to their children, and ultimately it does nothing 
to our bottom line.
  In short, Mr. Speaker, to put it simply, the federal government just 
should not be in the business of taking 55 percent of a family's 
business and destroying their livelihood. This tax should be 
eliminated, and it should be eliminated today, not next week or next 
month or next year.

[[Page H4143]]

  I hope my colleagues will join me in voting for the elimination of 
this onerous and damaging tax.
  I urge the adoption of H.R. 8.
  Mr. BEREUTER. Mr. Speaker, this Member rises today to express his 
support for H.R. 8, the ``Estate Tax Elimination Act of 2000.'' This 
Member's vote for this legislation today is based on his desire to move 
the inheritance tax reform process forward by dramatically increasing 
the Federal inheritance tax exemption level. However, this Member does 
not support the complete repeal of the Federal inheritance tax.
  This Member is a long-term advocate of inheritance tax reduction, 
especially in regard to protecting small businesses and family farms 
and ranches. This Member believes that inheritance taxes unfortunately 
do adversely and inappropriately affect Nebraskan small business and 
family farms and ranches when they attempt to pass this estate from one 
generation to the next.
  Accordingly, to demonstrate this Member's very real support for 
inheritance tax reform, this Member supported the Taxpayer Relief Act 
in 1997 which passed on July 31, 1997. This Act phased-in an increase 
in the unified credit exemption from the current level of $675,000 to 
$1.0 million in 2006. Also, it provided an immediate exclusion of $1.3 
million (not in addition to the broader exclusion) for a limited 
variety of eligible closely-held family farms and businesses.
  At the current time, this Member does not support the complete 
elimination of inheritance taxes. It would be a great political error 
and controversy to eliminate the inheritance tax on people like Steve 
Forbes or the billionaires or mega-millionaires. Also, the very 
negative impact on the largest of the charitable contributions and the 
establishment of charitable foundations cannot be underestimated. The 
benefit of these foundations to American society are invaluable. Our 
universities and colleges, too, would see a very marked reduction in 
the gifts they receive if the inheritance tax on the wealthiest 
Americans was totally eliminated. Despite the legal talents the super-
rich can afford, such an inheritance tax change would have major 
consequences. The total elimination of the inheritance tax is a bad 
idea.
  This Member's vote for this legislation only should be regarded as a 
demonstration of his desire to move the inheritance tax reform process 
forward by increasing dramatically the exemption level to the Federal 
inheritance tax. In addition, there is overwhelming support among his 
constituents for inheritance tax reform.
  Specifically, this Member does not support repealing the inheritance 
tax, with the final step completed in this legislation to zero percent 
inheritance tax from the year 2009 to the year 2010 as proposed. 
Instead, this Member prefers the Ewing approach which he 
enthusiastically support. This Member is an original cosponsor of H.R. 
4112 which was introduced by Representative Tom Ewing on March 29, 
2000. This measure (H.R. 4112) would immediately increase the Federal 
inheritance tax exemption from a rate of $675,000 to $5 million and 
would then increase this exemption annually over the next three years 
until it reaches a total of $10 million in 2003. After reaching the $10 
million level in 2003, the exemption would be indexed annually 
thereafter to account for inflation. Essential inheritance tax relief 
is provided by H.R. 4112 for even wealthy business and farm families. 
This Member is even willing to raise the exemption level beyond $10 
million to, for example, $15 million.
  By the way, most Nebraskans pay more state inheritance taxes than 
Federal inheritance or estate taxes so Nebraskans should also consider 
pushing for reductions or reforms in their state taxes.
  Mr. Speaker, this legislation, H.R. 8, if passed by the House, goes 
to an uncertain future in the Senate. In addition, if any legislation 
is reported from the Congress this year which totally eliminates the 
Federal inheritance tax, it is assured of a Presidential veto. Thus, 
this vote for H.R. 8 should be regarded as only demonstrating my firm 
conviction that we need to dramatically increase the Federal 
inheritance tax exemption level.
  Finally, Mr. Speaker, if a conference report comes back to the House 
that totally eliminates the Federal inheritance tax, this Member will 
vote against it.
  Mr. ENGEL. Mr. Speaker, in demonstration of my support for family 
owned businesses and farms, and because estate taxes are, in general, 
too high and burdensome, I cosponsored H.R. 8. I am glad that my action 
helped to shed light upon this issue.
  However, H.R. 8 was never a perfect bill. While rightfully focusing 
on the need to help reform the estate tax, the bill goes too far. I am 
concerned that although the bill does help small businesses and family 
farms, the majority of people who benefit if H.R. 8 passes are not 
average Americans, but the most wealthy. Furthermore, the bill would 
result in a substantial revenue loss over the next 10 years.
  This week, I have reviewed the amendment to H.R. 8 which will be 
offered by our colleagues, Representatives Rangel, Cardin, and 
Stenholm. This Democratic alternative specifically addresses the issue 
of providing relief to our farmers and families, which is the most 
important aspect of estate tax reform. I will, therefore, be very 
pleased to support the Democratic substitute as it addresses the very 
reason I cosponsored H.R. 8. It is my hope that this amendment will 
pass so that I can vote for H.R. 8, as amended. However, given that the 
Democratic substitute is markedly superior to the underlying bill, I 
will vote against H.R. 8 if the Democratic substitute fails.
  Mr. McDERMOTT. Mr. Speaker, by bringing their estate tax elimination 
proposal to the floor, the Republicans are clearly pandering to the 
richest Americans. Most Americans are not affected by the estate tax. 
98 percent of all estates are exempt from the tax. Of the two percent 
that are liable, only 3 percent of those are small businesses and 
farms.
  The estate tax repeal will not become law; this vote is purely 
political. If the Republicans genuinely wanted to help the 6 in 10,000 
American small businesses and farms subject to the estate tax, they 
would have worked with Democrats to craft a bipartisan compromise.
  Over the past two decades, income and wealth disparities have 
increased. The Republican proposal will exaggerate this by making the 
rich richer and the poor poorer. Repeal of the estate tax for the 
Forbes 400 richest Americans would amount to $200-300 billion. Enough 
to pay for a Medicare prescription drug benefit for 10 years!
  The rhetoric the Republicans have invoked during the estate tax 
debate is misleading. Calling the estate tax the ``death tax'' infers 
that all Americans will lose half of their estate and needlessly scares 
people.
  Mr. WELDON of Florida. Mr. Speaker, I rise today in strong support of 
H.R. 8, the Death Tax Elimination Act, of which I am a cosponsor. We in 
the House of Representatives are poised to continue our commitment to 
tax fairness for all hard-working Americans by voting to repeal the 
Death Tax. The Death Tax ranges from 37 to 55 percent and can even get 
as high as 60 percent in some cases. The Death Tax Elimination Act 
(H.R. 8) would phase out the tax over the next ten years on the death 
of an American.
  Since 1994, Republicans have been committed to balancing the budget, 
protecting Social Security and Medicare, and providing tax fairness to 
all hard-working Americans and their families. To date we have passed 
the Repeal of the Marriage Penalty, Small Business tax fairness, the 
Repeal of the Seniors' Work Tax, ended the 100 year ``tax on talking,'' 
and today we can get rid of the Death Tax.
  Americans pay taxes their whole lives, then at their death, Uncle Sam 
wants to get some more--sometimes taking over half of the poor soul's 
legacy. I have talked to farmers and small business owners in my 
district who are extremely worried at what the Death Taxes will mean to 
their children and grandchildren. These hard-working Americans have 
worked a lifetime to build a farm or business only to have it stripped 
and taken from their children by the Death Tax.
  The death tax is one of the most immoral taxes on the books, because 
it taxes farmers and small business owners twice. First these hard-
working Americans pay all of their taxes throughout the years, then the 
federal government taxes the value of their property again at the time 
of death.
  No American should be forced to pay up to 55 or 60 percent of their 
savings when they die. I'm proud to be part of the effort to repeal 
this tax. Let's bury the death tax once and for all.
  Let's pass this repeal and end the tax on death.
  Mr. SCHAFFER. Mr. Speaker, I rise today in support of H.R. 8, the 
Death Tax Elimination Act. As a cosponsor of this legislation, I am 
convinced this tax is completely unnecessary and in fact does more harm 
than good. The death tax penalizes business and job growth and impacts 
all individuals, not just the wealthy. It creates disincentive for 
expansion, long-term investment, and many times forces families to make 
difficult decisions about the future of their business.
  The death tax discourages the entrepreneurial spirit held dear by so 
many Americans. Our country was founded on principles that encourage 
citizens to become as successful as their talents allow. The Founding 
Fathers gave us the liberty to acquire and dispose of personal 
property. Unfortunately, some were mistakenly led to believe that 
equality of economic opportunity and the joys of owning property could 
be imparted to all by redistributing wealth.
  Today the death tax is actually burdening those it was once intended 
to help. Small business owners, farmers and self-employed individuals 
often fall victim to the tax. They sacrificed daily to build their 
business by reinvesting their profits only to realize that their

[[Page H4144]]

hard work and frugality will be rewarded by an excessive tax of up to 
55 percent.
  Many small business owners are forced to explore ways to shelter 
their assets from taxation, but the death tax is complicated. The tax 
actually encourages people to find creative ways to avoid it. It takes 
well-paid lawyers and accountants to find the best ways to legally 
avoid the high death tax liabilities ranging from 37 to 55 percent.
  The amount of money spent complying with, or trying to circumvent, 
the death tax is astronomical. Most of these solutions are costly, time 
consuming and inefficient. Gifts of stock, ownership restructuring, 
life insurance purchases and sales agreements are some of the tactics 
used to avoid the death tax. For most family farms, ranches and 
businesses, it's just too expensive.
  Nearly 98 percent of the two million farms in this country are owned 
by families. Those who cannot pay the costly tax-planning fees are 
forced to pay higher estate taxes. It is a tragedy that a family 
grieving over the death of a loved one should have to worry about 
losing the family business or farm to the Internal Revenue Service.
  Because the death tax requires a family to pay the federal government 
in cash within 9 months of the death of the decedent, it places a 
unique burden on a family farm or ranch like those in Colorado.
  Due to the capital-intensive nature of ranching, the income generated 
by a typical family ranch is often minimal and is generally reinvested 
in the operation. The result is that the sale of land or livestock is 
often the primary, and in some cases the only, source of funds 
available to meet this tax obligation when a family member passes away. 
Many of the farms and ranches near cities in Colorado are being sold 
and are being replaced by housing projects, malls and roads.
  Mr. Speaker, the death tax is also an example of double taxation. 
Small business owners, family farmers and ranchers pay income taxes 
throughout their lifetime. At the time of death, their surviving 
beneficiaries are forced to pay another tax on the value of the 
property.
  The people of Colorado and across America are tired of losing their 
hard-earned money to the federal government. Small businesses are 
sometimes forced to sell income-producing assets or lay off workers. 
Often a small business owner makes the tough choice to sell the 
business in order to pay a significantly lower capital gains rate of 20 
percent instead of the marginal death tax rate that could reach 55 
percent.
  Unfortunately, our Democrat friends who oppose this bill are dragging 
out the same old argument that the death tax prevents only the rich 
from passing on millions of dollars to their families. The fact is the 
IRS reports that 86 percent of all taxable estates have assets worth 
less than $2.5 million. Four out of five estates are valued at less 
than $1 million.
  At the same time, the death tax accounts for a mere 1.4 percent of 
all federal revenues. This meager amount is not worth the money 
Americans spend to comply with the tax, or the number of jobs lost 
because family businesses must be sold. In fact, as the IRS collects up 
to 55 percent of the value of the estate upon death, it spends 
approximately 65 percent of that revenue on administration and 
collection costs.
  Mr. Speaker, nearly 70 percent of small businesses do not survive the 
second generation and 87 percent do not make it to the third 
generation. Today, Members of this House should ask themselves if 
families should continue to work hard only to lose their life's wealth 
to the government instead of passing it on to their families.
  Mr. Speaker, the case is clear. Now is the time to eliminate the 
death tax. Let's give the American people to chance to develop their 
ideas and dream about the legacies they'll leave behind.
  Ms. McCARTHY of Missouri. Mr. Speaker, I rise today to express my 
strong support for targeted estate tax relief. Small businesses and 
farm owners should not be penalized for their success nor should they 
have to worry about their ability to pass the family business on to 
future generations. The Democratic Substitute offered by the gentleman 
from New York lowers rates and broadens the base and is a rational 
alternative for estate tax reform.
  Many middle class Americans believe they do not receive value for 
their taxes. An important component of any tax reform debate should 
focus on renewing taxpayer's confidence that they are not only being 
taxed fairly, but that their tax dollars are being spent wisely. It 
concerns me that we are considering repeal of the estate tax today 
without a broader discussion of reform of our tax policy. We don't make 
decisions in a vacuum and the decisions we make today will have an 
impact on future revenues, individual tax burdens, and spending on 
priority initiatives such as prescription drug reform, school 
construction and paying down the debt.
  The estate tax was originally enacted into law as a way to reduce 
wealth inequality by targeting the accumulation of wealth by sons and 
daughters of the richest in our society. The estate tax serves an 
important purpose by continuing to equalize wealth in our society. 
Historically, the richest in our society are the ones who pay the 
majority of the estate tax.
  Currently, only two percent of people who die have enough wealth to 
be subject to the estate tax. Of the two percent who pay the estate 
tax, only three percent are small business owners or farmers. According 
to the Joint Committee on Taxation, the largest estates pay most of the 
estate tax--5.4% of taxable estates paid 49% of total estate taxes in 
1997. Further a United States Treasury Department analysis finds that 
99% of all estate taxes are paid on the estates of people who are in 
the highest 20% of the income distribution at the time of their death 
and 91% of all estates taxes are paid by decedents by decedents with 
annual incomes exceeding $190,000 at the time of death.
  The estate tax is a progressive tax that serves the purpose intended 
by Republic Presidents Teddy Roosevelt and William Howard Taft who put 
this tax in place. Experts point out that the majority of assets taxed 
under the estate tax are unrealized gains and tax-exempt bonds which 
have never been taxed.
  Some small businesses and farmers are hit hard by this tax and it is 
a high priority for me to provide relief to these individuals. In my 
congressional district is Brown Industries a family owned small 
business which specializes in precision machined parts. I have toured 
their facility and met with members of the Kansas City Area Chapter of 
the National Tooling and Machining Association (NTMA). All of the firms 
represented focused their number one concern on estate tax reform. 
These firms face liquidating entire section of their plants to pay 
current estate tax so that the business can be inherited. Estate tax 
reform should consider estate tax and economic opportunity and address 
the concerns of small businesses like Brown Industries. The Democratic 
alternative does this. They will be negatively impacted by H.R. 8. I 
support estate tax relief which would exempt 99% of family farm estates 
taxes. The measure I vote for today increased the family exclusion for 
farms and closely held businesses to $4 million by increasing the limit 
on the small businesses exclusion from $1.3 million to $2 million per 
spouse. This would have provided real relief immediately. Without 
adoption of the substitute H.R. 8 would not provide relief to a single 
farm or small business from the estate tax until 2010. This relief is 
much needed now, not in ten years.
  The measure I voted in favor of today would have immediately 
increased the exemption equivalent of the unified credit against estate 
and gift taxes to $1.1 million. It also would have provided a twenty 
percent across-the-board reduction to the estate and gift tax rates.
  Finally, I voted for an estate tax relief proposal which was largely 
offset and would cost approximately $20 billion over ten years to 
maintain fiscal responsibility. H.R. 8 will cost the treasury $105 
billion over ten years. Beginning in 2010, it will cost $50 billion per 
year. While I am pleased that fiscal discipline of the past eight years 
has brought us to a time where we are enjoying budget surpluses, the 
surpluses in future years have not materialized and are only 
projections. I am optimistic the surpluses will be a reality and 
believe that we must commit them wisely. At this time, I am unconvinced 
that completely repealing the estate tax without further modifying our 
tax policy to ensure that wealthiest among us are paying their fair 
share is a wise decision. Projected surpluses still require us to make 
difficult decisions about priorities, and I believe that the measure I 
voted for today provides fiscally responsible relief.
  I strongly support targeted estate tax relief for individuals, small 
businesses and farm owners. I voted in favor of a fiscally responsible 
proposal today which would have provided immediate relief to many of 
the 989 individuals in Missouri who pay estate tax. As this bill moves 
forward in the legislative process I encourage both parties will work 
together to find a compromise which will provide the needed relief and 
which will be signed into law by the President.
  Mr. UDALL of Colorado. Mr. Speaker, I will vote for this bill, but 
only very reluctantly.
  My reluctance does not mean I don't support estate-tax relief for 
family-owned ranches and farms or other small businesses. In fact, I 
definitely think we should act to make it easier for their owners to 
pass them on to future generations.
  This is important for the whole country, of course, but it is 
particularly important for Coloradans who want to help keep ranch lands 
in open, undeveloped condition by reducing the pressure to sell them to 
pay estate taxes.
  But we do not need to do all that this Republican bill would do in 
order to make sure the estate tax is no longer too heavy a burden on 
the small business and farm owners.

[[Page H4145]]

  The Democratic alternative--the substitute for which I voted--would 
have provided real, effective relief without the excesses of the 
Republican bill.
  That alternative would have raised the estate tax's special exclusion 
to $4 million for a couple owning a farm or small business. So, under 
that alternative, a married couple owning a family farm or ranch or a 
small business worth up to $4 million could pass it on intact with no 
estate tax whatsoever.
  Also, the Democratic alternative actually would have provided more 
immediate relief to small business and farm owners.
  Unlike the Republican bill--which is phased in over ten years--the 
Democratic alternative would have taken effect immediately. That means 
a couple passing on their farm or small business in the near future 
would avoid more tax under the Democratic plan than under the 
Republican bill. They would not have to hope to live long enough to see 
the benefits.
  In addition, by increasing the general exclusion (now at $675,000) to 
$1.1 million next year, the Democratic alternative would allow for any 
person to pass on ``millionaire'' status to their children without a 
penny of estate tax burden. And the Democratic alternative also would 
lower estate tax rates by 20% across the board.
  So, the Democratic alternative--which I voted for and which deserved 
adoption--would provide important relief from the estate tax and would 
have done so in a real, effective, and prompt way.
  Furthermore, the Democratic alternative would have provided this 
relief in a fiscally responsible way that would not jeopardize our 
ability to do what is needed to maintain and strengthen Social Security 
and Medicare, provide a prescription drug benefit for seniors and pay 
down the public debt.
  By contrast, it is precisely the fiscal overkill of the Republican 
bill that makes me most reluctant to vote for it.
  Once fully phased in, the Republican bill would forgo nearly $50 
billion a year in revenue with no guarantee that this revenue loss will 
not harm Social Security and Medicare in future years.
  The bill's sponsors say it will cost $28.2 billion over 5 years and 
$104.5 billion over 10 years. But that is far from the whole story.
  Because of the way the bill is phased in, its true cost is cleverly 
hidden and does not show up until after the 10-year budget window.
  That means the full effects of the Republican bill will come just at 
the time when we will have to face budget pressures because my own 
``baby boom'' generation is starting to retire. And if we feel we need 
to ``phase in'' H.R. 8 because we cannot afford the full repeal now, 
how are we ever going to afford it 10 years from now?
  We do not need to engage in this fiscal overkill.
  According to the Treasury Department, under current law only 2% of 
all decedents have enough wealth to be subject to the estate tax at 
all.
  To be more specific, the Treasury Department tells me that in 1997 
estate-tax returns were filed for only 297 Coloradans.
  Furthermore, according to the Treasury Department, of those estates 
that are affected by the estate tax, only 3%--that is only 6 in 10,000 
American estates--were comprised primarily of family-owned small 
businesses, ranches, or farms.
  Looking just at our state, that means that in 1997 fewer than a dozen 
estate-tax returns were comprised primarily of small businesses, 
ranches, or farms.
  Of course, those numbers only relate to the cases in which an estate 
tax was actually paid. Clearly, in many other cases families have taken 
actions to forestall the estate tax. I understand that, and do think 
that in appropriate cases we should lessen the pressure that prompted 
some of those actions.
  As I said, the Democratic alternative would have provided real, 
effective, and immediate estate-tax relief to the owners of small 
businesses, including farms and ranches, and would have done so in a 
fiscally responsible way. That is why I voted for it.
  In contrast, the biggest beneficiaries of the Republican legislation 
are not those middle-class families who own small ranches or farms or 
other small businesses, but instead are very wealthy families with very 
large assets.
  Over the past two decades, income and wealth disparities have 
increased. The Republican bill, while it does have some positive 
aspects, would increase those wealth disparities. I find this 
troubling, and it adds to my reluctance to support the bill.
  However, I will vote for the bill because the Republican leadership 
has made it clear that it is this bill or no estate-tax relief bill, at 
least for now, here in the House.
  That being the case, I have decided that the Republican bill--
although very flawed and excessive--is just acceptable enough for me to 
vote for today.
  I do so in the hope and expectation that the bill's faults can be 
corrected as it proceeds through the legislative process and that 
ultimately it can be refined into a bill that deserves to be enacted 
into law.
  If that does not occur--if that hope and expectation prove 
unfounded--I will not vote for a bill that fails to meet that standard.
  Mr. BENTSEN. Mr. Speaker, I rise in opposition to H.R. 8, the ``Death 
Tax Elimination Act,'' a fiscally-imprudent measure that the Republican 
Majority has brought to the floor, knowing that it provides tax relief 
to only two percent of all estates and benefits only the wealthiest in 
our society. I am supportive of federal estate tax relief, not a 
repeal, particularly for family farms and closely-held small businesses 
and strongly support of the Rangel Substitute Amendment, a fiscally 
responsible alternative that the President will sign.
  Under H.R. 8, the federal estate tax would be reduced gradually over 
the next decade and would be fully repealed in 2010. The Joint 
Committee on Taxation estimates that it will cost $105 billion to 
repeal the estate tax in the first ten years. However, the 
Administration estimates that the federal revenue loss from H.R. 8 
would be approximately $50 billion annually after 2010, once the estate 
and gift tax was fully repealed. Thus, the cost of H.R. 8 in the second 
decade of phase-in would be nearly six times the cost for 2001-2010.
  As a member of the Budget Committee, I continue to advocate that 
Congress preserve the budget surplus and use it to pay off the national 
debt while strengthening Social Security. The $3.7 trillion dollar 
public debt is a tremendous burden on the economy. H.R. 8 jeopardizes 
our ability to protect Social Security and Medicare and pay down the 
national debt by creating a revenue loss, when executed, in excess of 
half a trillion dollars over ten years.
  In the second decade of the century, with H.R. 8 costing $50 billion 
annually, the ``Baby Boom'' generation will begin retiring in large 
numbers, logically driving up the costs of programs such as Social 
Security, Medicaid and Medicare. At the same time, the Congressional 
Budget Office (CBO) projects that total Federal budgetary surpluses 
will begin to decline. How will we pay for the programs? Will we cut 
Social Security, Medicare and Medicaid benefits?
  H.R. 8 would only help the less than two percent of all estates that 
are currently subject to any federal estate tax. To be subject to the 
federal estate tax, the size of one's estate must exceed $675,000 in 
2000. By 2006, the estate tax exemption will rise to $1 million. 
Furthermore, current law provides for an even higher exemption of $1.3 
million per person for closely-held farms and non-public businesses. 
But H.R. 8, under the guise of helping family farms and ``mom & pop'' 
small business would repeal the estate tax on all estates including the 
wealthiest. Under this bill, Bill Gates would be able to transfer 
$80,000,000,000 tax free to his heirs, hardly the estate of a small 
businessman.
  The Rangel Substitute is an appropriate affordable alternative which 
provides relief to real family-owned businesses and farms. Rather than 
repeal the tax and bust the budget, it provides an across-the-board 20 
percent reduction to the top estate and marginal gift rates, including 
a reduction in the top marginal rate from 55% to 44%. It would 
immediately increase the exemption equivalent of the unified credit 
against estate and gift taxes to $1,100,000. It also would provide for 
targeted tax relief for farm and small business estates and raise the 
special exclusion to $2 million per person, $4 million for a married 
couple. Moreover, the Rangel Alternative is a fiscally responsible 
measure, costing approximately $20 billion over 10 years with no 
exploding outyear costs. Clearly, Mr. Rangel has proposed a superior 
measure that truly helps those that the proponents of H.R. 8 purport to 
be helping.
  Finally, I would also like to address the myth perpetuated by my 
colleagues on the other side of the aisle that H.R. 8 enhances 
protections for small businesses and farms. H.R. 8 does not provide any 
additional exemption until 2010, while the Rangel Alternative would 
provide an immediate $4 million per family exclusion for family farms 
and closely-held small businesses and would exempt 99% of family farms 
form estate taxes. In the past, I have supported legislation that has 
provided relief to family farms. In 1997, I supported the Taxpayer 
Relief Act (P.L. 105-34) that raised the effective deduction for 
qualified family-owned business interests to $1.3 million per 
individual, which exempts almost all family farms and small businesses 
from the estate tax. Moreover, the few businesses and farms that are 
subject to the estate tax can make payments in installments over 
fourteen years at below-market interest rates. The Rangel Substitute 
would build on these protections by providing further immediate relief.
  There is a need for estate and gift tax reform but outright repeal 
through passage of H.R. 8 is clearly not the way. If proponents are in 
favor of real reform to help owners of real small businesses and farms 
and not the wealthiest among us, I urge them to join with me in 
supporting the Rangel Substitute.

[[Page H4146]]

  Mrs. BIGGERT. Mr. Speaker, I rise today in strong support of the 
Death Tax Elimination Act. This unfair tax has long outlived its 
usefulness.
  I come to this debate with something of a unique perspective on this 
issue. For more than twenty years, I practiced estate law. I have 
actually sat down and helped people navigate this extremely complex 
tax. I was not helping Bill Gates or Ross Perot--I was helping the sons 
and daughters of small business owners try to keep their parent's 
dreams alive.
  Unfortunately, because they have to pay a tax of 37 to 55 percent on 
their estate, it is often impossible for them to continue. It is simply 
heartbreaking to see children who want to keep their parent's business 
alive have to sell it just to pay the taxes.
  We are here in Congress to make things better for the American 
people. When more than 70 percent of small businesses do not make it to 
the second generation, something is wrong and must be made better.
  The Death Tax Elimination Act will make things better.
  I urge all my colleagues to support the Death Tax Elimination Act. 
The time is now to once and for all put an end to the death tax.
  Mr. RYAN of Kansas. Mr. Speaker, I rise today to oppose the 
proposition that an American who works hard, builds a business and 
saves for his family should have to turn over 55% of what he owns to 
the tax collectors in Washington when he dies.
  The Death Tax reduces economic growth and increases the cost of 
capital. It causes individuals to shift much of their wealth to 
immediate consumption rather than long-term, productive investments. If 
these investments were made, it would create long-term economic growth 
by lowering interest rates and creating more jobs.
  It shouldn't surprise us, however, to hear those who favor the Death 
tax argue that repealing it would help only the rich. Next time I go 
back to my district and hear from the farmers and small business men 
who ask me why their families will have to sell their business to pay 
the Death Tax, I'll tell them that some influential members of the 
other party in Washington said they were too rich to get relief.
  To add insult to injury, I'll remind them that the federal government 
raises just 1% of its annual revenue from the Death Tax.
  I'll even tell them that those who can afford to hire lawyers and 
accountants to tend to their finances have already figured out ways to 
avoid paying the tax.
  Mr. Speaker, I also want to speak about another unjust provision of 
our tax code that this legislation will repeal. The Generation Skipping 
Tax effectively prohibits the transfer of your property to your 
grandchildren or someone 37\1/2\ years younger than you by taxing that 
transfer at a rate of 55%.
  In my district, the long-time business owner of Key Industries, 
Kenneth Pollock, regularly paid bonuses to his employees based on 
loyalty and length of service to the company. Whether you worked in the 
executive office or on the assembly line, everyone was treated the 
same.
  As Mr. Pollock prepared for his death, he determined that he wanted 
to leave his estate in trust for the benefit of his current and former 
employees. Each current or former employee was to continue to receive 
an annual distribution from the trust in an amount similar to their 
annual bonus based on years of service to the company.
  Unfortunately, Mr. Pollock did not properly prepare the trust. All 
employees more than 37\1/2\ years younger than Mr. Pollock are now 
subject to the 55% Generation Skipping Tax on each distribution from 
the trust. Many of these workers earn less than $10 per hour. It is bad 
public policy to tax this much-needed annual bonus at 55%. It is bad 
public policy to discourage generosity.
  To make things worse, the company was forced recently to make the 
difficult business decision to close two plants. Many displaced workers 
will receive one-time lump sum payments from the trust of $10,000 or 
more. The employees will lose more than 1/2 of this money at a time 
when they need it most.
  Unfortunately, the repeal of the Generation Skipping Tax will not 
take place for nine years. That is why I have authored legislation to 
treat the annual distributions from this trust just like any other gift 
by exempting the first $10,000 from the tax annually. Mr. Speaker, I 
hope that you and Chairman Archer will work with me to pass this much 
needed provision.
  Today, however, we have the opportunity to encourage economic growth 
and remove this tax burden that falls heaviest on the family businesses 
and family farms across Kansas and the rest of the country.
  Mr. Speaker, I urge my colleagues to join me and vote to repeal the 
Death Tax.
  Mr. ETHERIDGE. Mr. Speaker, I rise in reluctant support of H.R. 8, 
the so-called Death Tax Act. While I would prefer a more targeted 
approach to eliminating this tax, I remain hopeful that passing H.R. 8 
could be the first step in the process of finding a compromise granting 
the vast majority of Americans estate tax relief without jeopardizing 
the fiscal health of our nation.
  Let there be no mistake, I have supported relief from the death tax 
for our family farmers and small business owners since I came to this 
body in 1977. The first bill I introduced as a Member of Congress was 
H.R. 1845, the Family Farm and Small Business Estate Tax Relief Act of 
1997. This legislation would have raised the inheritance tax exemption 
for small business people and family farmers from $600,000 to $1.5 
million and indexed it to inflation for the first time. The Taxpayer 
Relief Act of 1997 later raised the exemption to $1.3 million. This was 
not as much estate tax relief as I had hoped for, so I continued 
working.
  On March 27 of this year, I introduced a proposal that would 
significantly reduce the estate tax burden faced by those who inherit 
family owned farms and small businesses. I believe that the current 
estate tax exemption should be raised from the current level of $1.3 
million to $4 million over the next five years and indexed to inflation 
thereafter. Reducing estate taxes is vital to ensuring that family 
farmers and small business owners can pass their hard-earned assets to 
their loved ones. My bill accomplishes this important goal in a 
responsible manner that is consistent with our values.
  The Democratic Substitute to H.R. 8, offered by my good friends from 
New York and Texas, Mr. Rangel and Mr. Stenholm, also would provide for 
a $4 million estate tax exemption to family farmers and small 
businesses, as my bill would. It cuts estate taxes across the board by 
20 percent and only costs $22 billion over 10 years. I am proud to 
support the Rangel-Stenholm plan because it is fiscally responsible and 
represents the kind of compromise that can not only obtain wide 
bipartisan support, but also be signed by the President.
  Unfortunately, the Republican bill, H.R. 8, once fully implemented, 
would cost the U.S. Treasury $100 billion over 10 years and then an 
estimated $50 billion a year afterwards. This means less money for 
school construction, less money for Medicare, and less money to protect 
Social Security for the rest of this century.
  There are other flaws to H.R. 8. While the Democratic alternative 
provides estate tax relief to family farmers and small businesses 
immediately, H.R. 8 forces farmers and businesses to wait 10 years 
before obtaining the same level of benefits. The President has 
indicated loud and clear that he intends to veto this bill if it 
reaches his desk. The Republicans should work in a bipartisan manner to 
find a compromise that can become law and provide immediate tax relief.
  I reluctantly vote in favor of H.R. 8, I vote for H.R. 8 today to 
move the legislative process forward, hopefully toward a bipartisan 
conclusion that will accomplish real relief from the estate tax for 
North Carolina's family farmers and small businesses.
  I vote in favor of H.R. 8 now, but reserve the right to vote against 
this or similar bills in the future if my concerns about the problems 
of this plan are not addressed. Additionally, I reserve the right to 
vote to sustain the expected presidential veto of H.R. 8 unless needed 
changes are made.
  Mrs. FOWLER. Mr. Speaker, I rise today to express my strong support 
for the Death Tax Elimination Act of 2000. During my tenure in Congress 
I have supported measures that would provide relief from unfair taxes 
to all Americans, and I have long believed that eliminating the estate 
tax is an important step in this process. It is past time to remove 
this onerous, unfair tax that punishes life-long habits of saving and 
discourages entrepreneurship.
  The real burden of this tax falls on family-owned businesses and the 
people who work for them who lose their jobs when a business is forced 
to sell in order to pay these taxes. The death tax is a major reason 
that 70% of small businesses do not survive to the second generation 
and 87% do not survive to the third. A repeal of the estate tax will 
mean more jobs, economic growth and preservation of the American Dream.
  Uncle Sam should not be sitting outside a funeral home waiting to 
take away the family business. It is time we allow families to pass on 
the family business to new generations without being hit by an 
arbitrary tax of 37 to 55 percent of the value of their business. I 
urge my colleagues to vote to remove this outrageous tax on hardworking 
American families.
  Mr. THORNBERRY. Mr. Speaker, I rise in support of H.R. 8, although I 
would prefer to abolish the death tax immediately and completely. But, 
the unusual budgetary scoring rules which we must follow do not allow 
us to take into account real world consequences of changes in tax 
policy, and so we must phase it out.
  While there is a lot of ``sound and fury'' in this debate, the 
essential point is this: It is

[[Page H4147]]

wrong to tax death. It doesn't matter if someone has saved $5 or $5 
million; it is wrong to tax death.
  People in my district and all around the country have worked hard all 
their lives, paid taxes on what they have earned, saved, and want to 
leave something so their children can have a better life. It is wrong 
to punish them for doing so.
  It also makes sense to get rid of this tax. A report by our Joint 
Economic Committee in December 1998 provides Members with a 
comprehensive look at the many studies that have been made on the 
effects of this tax. The JEC report found that:
  The death tax reduced capital stocks in the U.S. by 3.2%, limiting 
growth, job creation, and higher standards of living for our people.
  The death tax makes small businesses, particularly minority and 
female-owned small businesses, less likely to invest, expand, and hire 
new workers. Indeed, they are forced to spend thousands of dollars on 
lawyers, accountants, life insurance, and other tax avoidance measures.
  The death tax is ineffective at redistributing wealth, for those who 
believe that should be a desirable goal of the federal government.
  The death tax raises little, if any, net revenue for the federal 
government when the enormous costs of compliance and economic 
consequences of it are taken into account.
  Mr. Speaker, we should not punish growth, savings, and job creation. 
We should not punish people who try to leave a better life for their 
children. We should abolish the death tax once and for all.
  Mr. PASTOR. Mr. Speaker, during the recent consideration of H.R. 8, 
legislation which would repeal the estate tax, I supported an 
alternative which was drafted to give immediate protection to the 
American farmer and the small businessman whose heirs are in danger of 
losing their family's hard-earned, life-long business to the Federal 
government.
  I have always supported the elimination of the estate tax. And even 
though I am a cosponsor of H.R. 8, I believe the Democratic alternative 
is better suited, at this time, for accomplishing what we need in 
eliminating this unfair tax. The Democratic alternative immediately 
provides a $4 million per family exclusion for farms and small 
businesses and it lowers the tax rate. H.R. 8 takes ten years before it 
is fully phased-into place.
  In short, the Democratic alternative helps the right people right 
now. It does more and does it quicker than the version of H.R. 8 which 
I cosponsored back in July of 1999. At that time, there was no better 
alternative and it was assumed that a comprehensive tax package would 
be instituted which would provide across-the-board benefits for hard-
working middle-class citizens as well as the wealthy. Standing alone, 
H.R. 8 does nothing for middle-income families. And by not enacting a 
full package of tax relief for all Americans, the lost revenues 
increase the burden on the same middle-income workers who must make up 
the shortfall in preserving Social Security and Medicare, providing a 
prescription drug benefit for our seniors, improving our educational 
system, and paying down the debt.
  Like the rest of America, I am pleased that we are enjoying a period 
of prosperity with a strong economy. However, we have no guarantee that 
this respite will continue. In light of this uncertainty, it is 
patently unfair to grant a massive tax relief provision that benefits 
only 2% of the nation's richest persons while creating a drain on 
revenues which would ultimately burden two-income families who are 
struggling today to make ends meet.
  Mrs. McCARTHY of New York. Mr. Speaker, I rise today as a proud 
cosponsor of H.R. 8, The Estate Tax Elimination Act, which provides 
estate tax relief for family-owned small businesses.
  The estate or ``death'' tax has deviated from its original intent and 
purpose. From a practical sense, it was established to provide revenue 
on a short-term basis to finance military action.
  In theory, however, it was also viewed as a way to protect society 
against growing concentrations of wealth in the hands of a very few. 
Supposedly, this tax would encourage market growth which was hindered 
by the inheritance of estates.
  Well, the market has grown. Family-owned small businesses have become 
the backbone of our economy and continue to provide invaluable 
services.
  Recognizing their importance, programs were created to promote their 
existence and expansion in the form of loans and other assistance 
programs. Unfortunately, their lifespan is hindered by an unfair tax 
levied when ownership is transferred at the time of death.
  Less than 30 percent of all family-owned businesses survive through 
the second generation. This is unacceptable.
  The district I represent on Long Island, is dependent on the success 
of family-owned small businesses. A lot of hard work and determination 
is involved to secure their prosperity.
  More often than not the odds are usually stacked against them in the 
form of a complex tax code or competition by larger companies. The 
estate tax, however, is another hurdle small businesses must overcome 
that is more harmful than beneficial.
  I urge my colleagues to support this important measure.
  Mr. CHAMBLISS. Mr. Speaker, the folks that I represent in Georgia's 
8th, Congressional District are hard-working. The majority of these 
people own small family businesses and family farms. They get up each 
day, go to their jobs, work hard for their families, and pay their 
taxes like responsible Americans.
  The federal government asks them to do all of this, but at the end of 
the line, after a lifetime of hard work and paying taxes, Uncle Sam 
reaches in and takes over half of their life's accumulation. This is 
simply wrong. Mr. Speaker, the death tax is immoral, un-American, and 
this House must bury it.
  The death tax is an unfair burden that taxes farmers and small 
business owners twice. The farmers in Georgia's 8th District work 
tirelessly to feed and clothe America. They do this while battling 
severe weather, droughts, floods, and low prices. Times are tough in 
rural America right now, the burdens are high, and the death tax is 
just a slap in the face to our farmers, who produce the safest, highest 
quality food and fiber in the world.
  The death tax affects one-third of small business owners, who are 
forced to sell outright or liquidate a part of their firms to pay 
estate taxes. When mom-and pop shops must close because of an outdated, 
unfair tax code, this Congress must take the lead and make a change.
  The death tax is contrary to the freedom and free-market principles 
on which this nation was founded. Do we support the IRS or do we 
support the American family? We must help Georgia families continue 
their livelihood and pass their legacy and success on to their children 
and grandchildren, not burden them with taxes that kill a lifetime of 
hard-work. Let's bury the death tax here, today. I urge my colleagues 
to vote to end the estate tax.
  Mr. PORTMAN. Mr. Speaker, I rise to express my support for H.R. 8, 
the Death Tax Elimination Act. I commend the sponsor of the bill, my 
Ways and Means Committee colleague, Ms. Dunn, for her work on this 
issue. And I commend the Chairman of the Committee, Mr. Archer, for his 
long commitment to eliminating this unfair and unreasonable tax.
  The death tax is bad tax policy. It is double taxation, because 
individuals who pay taxes on income throughout their lives are taxed 
again on the same income at their time of death on the value of their 
property. The rates--up to 60 percent--are the highest in the tax code.
  The death tax is bad policy not only because of the costs it imposes 
after death--but also because of the costs it imposes during life. The 
additional costs of life insurance, attorneys fees and estate planning 
services cost hundreds of thousands of dollars every year.
  The death tax is also an inefficient drag on our economy. The Joint 
Economic Committee of Congress has reported that, while the death tax 
generates about $23 billion annually in revenue for the federal 
government, it also costs businesses, farmers and individuals another 
$23 billion just in compliance costs.
  Unfortunately, in the area I represent in Southwest Ohio, many family 
farmers and family business owners just aren't prepared to deal with 
the consequences of the death tax. According to a recent study by 
Arthur Andersen's Center for Family Business, 28 percent of senior 
generation shareholders of family businesses surveyed in Greater 
Cincinnati had not completed any estate planning other than a will.
  And, although 71 percent of these individuals wanted the family 
business to stay in the family after their death, the study found that 
less than 30 percent would be able to do so unless they better examined 
the issues of estate taxes and planning.
  Small businesses and family farms have made the American dream 
possible for generations. At a time when 70 percent of family-owned 
businesses do not survive to the second generaton, and only about 13 
percent survive to the third generation, our tax laws should be 
encouraging--rather than preventing--people to pass these assets to 
their families.
  We're losing too many family-owned businesses and family-farms as it 
is. I urge my colleague to support the Death Tax Elimination Act--to 
put an end to this unfair, inefficient and confiscatory tax.
  Mr. DOOLEY of California. Mr. Speaker, I rise today in strong support 
of this bipartisan legislation to repeal the federal estate tax over 
the next ten years, and I salute Representatives Dunn and Tanner for 
their long stewardship of this bill. As a family farmer myself and as 
the representative of the most productive agricultural region of the 
country, I have seen the impact that this tax has had on small 
businesses and family-owned farms, and I believe

[[Page H4148]]

that the repeal of the estate tax will help ensure the survival of 
these businesses into the next century.
  Seventy percent of family businesses are not passed on to future 
generations largely because of the burden imposed by estate taxes. In 
particular, I would like to point out the impact of estate taxes on 
family farms, since it is these family farms that drive the economy of 
California's Central Valley, which I represent. The estate tax has a 
devastating effect on family farmers who struggle to pass on their 
farms to the next generation.
  Since most family-owned farms do not earn the kind of profits 
necessary to pay large estate tax bills, future generations are often 
forced to mortgage or liquidate assets. As a fourth generation family 
farmer, I have seen first-hand the difficulty that family members face 
in trying to keep farms operating when each generation passes. 
Eliminating the heavy burden the estate tax imposes on farmers will 
help keep more of our farms in operation from generation to generation.
  I would also argue that elimination of the estate tax would have a 
positive impact on a number of the small rural communities that make up 
the fabric of my district and much of this nation. These small rural 
communities and the families that live there are highly dependent on 
the continued operation of family farms and small businesses in the 
area.
  These family farms and small businesses employ the vast majority of 
people in these small communities. If we are to continue to spread our 
unprecedented national economic expansion to every corner of this 
country--including our rural communities--we must work to ensure that 
family farms and small businesses in these communities stay in 
operation. Elimination of the estate tax will brighten these 
communities' economic future.
  I strongly support this legislation because I believe it will free 
our family farmers and small businesspeople of the estate tax burden 
that currently threatens their long-term survival, and strengthen our 
small communities in the 21st century.
  Mr. RILEY. Mr. Speaker, opponents to this bill argue that it will 
only benefit the rich.
  Well, Mr. Chairman, let's take a look at the group of ``rich'' people 
this bill unfairly helps.
  In my district, and in rural districts across the nation, the death 
tax hits the farm family especially hard. Because of economies of scale 
and the ever rising cost of equipment, they have become land and 
capital rich.
  Everyone should know by now, farmers live on the margin. They have 
very modest incomes and in today's world most farm families are far 
from ``rich.''
  For year to year, farm families struggle simply to keep their heads 
above water. They may be land rich, Mr. Speaker, but they are cash 
poor.
  Yet, when a farmer dies, we punish him for his hard work. Then we 
force his family to sell the land they grew-up on to pay the estate 
taxes and send them on their way.
  The result, people who would like to carry on their family tradition 
of farming are instead being forced to sell their land to wealthy land 
developers who then turn that land into more cookie-cutter sub-
divisions and strip malls.
  If you don't believe me, Mr. Speaker, take a drive out to Dulles 
Airport some time. That all used to be farm land not so long ago.
  The death tax is killing an American tradition and that's absolutely 
appalling.
  It's time we end this travesty and pass this bill.
  The SPEAKER pro tempore (Mr. Kolbe). All time for general debate has 
expired.


     Amendment in the Nature of a Substitute Offered by Mr. Rangel

  Mr. RANGEL. Mr. Speaker, I offer an amendment in the nature of a 
substitute.
  The SPEAKER pro tempore. The Clerk will designate the amendment in 
the nature of a substitute.
  The text of the amendment in the nature of a substitute is as 
follows:

       Amendment in the nature of a substitute offered by Mr. 
     Rangel:
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE.

       (a) Short Title.--This Act may be cited as the ``Estate Tax 
     Relief Act of 2000''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of the Internal 
     Revenue Code of 1986.

     SEC. 2. 20 PERCENT REDUCTION OF ESTATE TAX RATES.

       (a) In General.--Paragraph (1) of section 2001(c) is 
     amended to read as follows:
       ``(1) In General.--

``If the amount with respect to which the tentative tax is to be 
The tentative tax is:
14.4% of such amount...................................................
$1,440, plus 16% of the excess of such amount over $10,000.............
$3,040, plus 17.6% of the excess of such amount over $20,000...........
$6,560, plus 19.2% of the excess of such amount over $40,000...........
$10,400, plus 20.8% of the excess of such amount over $60,000..........
$14,560, plus 22.4% of the excess of such amount over $80,000..........
$19,040, plus 24% of the excess of such amount over $100,000...........
$31,040, plus 25.6% of the excess of such amount over $150,000.........
$56,640, plus 27.2% of the excess of such amount over $250,000.........
$124,640, plus 29.6% of the excess of such amount over $500,000........
$198,640, plus 31.2% of the excess of such amount over $750,000........
$276,640, plus 32.8% of the excess of such amount over $1,000,000......
$358,640, plus 34.4% of the excess of such amount over $1,250,000......
$444,640, plus 36% of the excess of such amount over $1,500,000........
$624,640, plus 39.2% of the excess of such amount over $2,000,000......
$820,640, plus 42.4% of the excess of such amount over $2,500,000......
$1,032,640, plus 44% of the excess of such amount over $3,000,000''....
       (b) Restoration of Phaseout of Unified Credit.--Paragraph 
     (2) of section 2001(c) is amended by striking ``$10,000,000'' 
     and all that follows and inserting ``$10,000,000. The amount 
     of the increase under the preceding sentence shall not exceed 
     the sum of--
       ``(A) the applicable credit amount under section 2010(c), 
     and
       ``(B) the excess of the amount equal to 44 percent of 
     $3,000,000 over the amount of the tentative tax under 
     paragraph (1) on $3,000,000.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying, and gifts made, 
     after December 31, 2000.

     SEC. 3. INCREASE IN EXEMPTION EQUIVALENT OF UNIFIED CREDIT.

       (a) In General.--The table contained in section 2010(c) 
     (relating to applicable credit amount) is amended to read as 
     follows:

The applicable exclusion amount is:ts dying, and gifts made, during:
      2000...................................................$ 675,000 
      2001, 2002, 2003, 2004, and 2005......................$1,100,000 
      2006 or thereafter.................................$1,200,000.''.

       (b) Effective Date.--The amendment made by this section 
     shall apply to estates of decedents dying, and gifts made, 
     after December 31, 2000.

     SEC. 4. INCREASE IN ESTATE TAX BENEFIT FOR FAMILY-OWNED 
                   BUSINESS INTERESTS.

       (a) Transfer to Credit Provisions.--Section 2057 (relating 
     to family-owned business interests) is hereby moved to part 
     II of subchapter A of chapter 11 of such Code, inserted after 
     section 2010, and redesignated as section 2010A.
       (b) Increase in Credit; Surviving Spouse Allowed Unused 
     Credit of Decedent.--Subsection (a) of section 2010A, as 
     redesignated by subsection (a) of this section, is amended to 
     read as follows:
       ``(a) Increase in United Credit.--For purposes of 
     determining the unified credit under section 2010 in the case 
     of an estate of a decedent to which this section applies--
       ``(1) In general.--The applicable exclusion amount under 
     section 2010(c) shall be increased (but not in excess of 
     $2,000,000) by the adjusted value of the qualified family-
     owned business interests of the decedent which are described 
     in subsection (b)(2) and for which no deduction is allowed 
     under section 2056.
       ``(2) Treatment of unused limitation of predeceased 
     spouse.--In the case of a decedent--
       ``(A) having no surviving spouse, but
       ``(B) who was the surviving spouse of a decedent--
       ``(i) who died after December 31, 2000, and
       ``(ii) whose estate met the requirements of subsection 
     (b)(1) other than subparagraph (B) thereof,
     there shall be substituted for `$2,000,000' in paragraph (1) 
     an amount equal to the excess of $4,000,000 over the 
     exclusion equivalent of the credit allowed under section 2010 
     (as increased by this section) to the estate of the decedent 
     referred to in subparagraph (B). For purposes of the 
     preceding sentence, the exclusion equivalent of the credit is 
     the amount on which a tentative tax under section 2001(c) 
     equal to such credit would be imposed.''
       (c) Conforming Amendments.--
       (1) The table of sections for part IV of subchapter A of 
     chapter 11 of such Code is amended by striking the item 
     relating to section 2057.
       (2) Paragraph (10) of section 2031(c) of such Code is 
     amended by striking ``section 2057(e)(3)'' and inserting 
     ``section 2010A(e)(3)''.
       (3) The table of sections for part II of subchapter A of 
     chapter 11 of such Code is amended by inserting after the 
     item relating to section 2010 the following new item:


[[Page H4149]]


``Sec. 2010A. Family-owned business interests.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying after December 31, 
     2000.

     SEC. 5. CREDIT FOR STATE DEATH TAXES REPLACED WITH DEDUCTION 
                   FOR SUCH TAXES.

       (a) Repeal of Credit.--Section 2011 (relating to credit for 
     State death taxes) is hereby repealed.
       (b) Deduction for State Death Taxes.--Part IV of subchapter 
     A of chapter 11 is amended by adding at the end the following 
     new section:

     ``SEC. 2058. STATE DEATH TAXES.

       ``(a) Allowance of Deduction.--For purposes of the tax 
     imposed by section 2001, the value of the taxable estate 
     shall be determined by deducting from the value of the gross 
     estate the amount of any estate, inheritance, legacy, or 
     succession taxes actually paid to any State or the District 
     of Columbia, in respect of any property included in the gross 
     estate (not including any such taxes paid with respect to the 
     estate of a person other than the decedent).
       ``(b) Period of Limitations.--The deduction allowed by this 
     section shall include only such taxes as were actually paid 
     and deduction therefor claimed within 4 years after the 
     filing of the return required by section 6018, except that--
       ``(1) If a petition for redetermination of a deficiency has 
     been filed with the Tax Court within the time prescribed in 
     section 6213(a), then within such 4-year period or before the 
     expiration of 60 days after the decision of the Tax Court 
     becomes final.
       ``(2) If, under section 6161 or 6166, an extension of time 
     has been granted for payment of the tax shown on the return, 
     or of a deficiency, then within such 4-year period or before 
     the date of the expiration of the period of the extension.
       ``(3) If a claim for refund or credit of an overpayment of 
     tax imposed by this chapter has been filed within the time 
     prescribed in section 6511, then within such 4-year period or 
     before the expiration of 60 days from the date of mailing by 
     certified mail or registered mail by the Secretary to the 
     taxpayer of a notice of the disallowance of any part of such 
     claim, or before the expiration of 60 days after a decision 
     by any court of competent jurisdiction becomes final with 
     respect to a timely suit instituted upon such claim, 
     whichever is later.
     Refund based on the deduction may (despite the provisions of 
     sections 6511 and 6512) be made if claim therefor is filed 
     within the period above provided. Any such refund shall be 
     made without interest.''
       (c) Conforming Amendments.--
       (1) Subsection (a) of section 2012 is amended by striking 
     ``the credit for State death taxes provided by section 2011 
     and''.
       (2) Subparagraph (A) of section 2013(c)(1) is amended by 
     striking ``2011,''.
       (3) Paragraph (2) of section 2014(b) is amended by striking 
     ``, 2011,''.
       (4) Sections 2015 and 2016 are each amended by striking 
     ``2011 or''.
       (5) Subsection (d) of section 2053 is amended to read as 
     follows:
       ``(d) Certain Foreign Death Taxes.--
       ``(1) In general.--Notwithstanding the provisions of 
     subsection (c)(1)(B) of this section, for purposes of the tax 
     imposed by section 2001, the value of the taxable estate may 
     be determined, if the executor so elects before the 
     expiration of the period of limitation for assessment 
     provided in section 6501, by deducting from the value of the 
     gross estate the amount (as determined in accordance with 
     regulations prescribed by the Secretary) of any estate, 
     succession, legacy, or inheritance tax imposed by and 
     actually paid to any foreign country, in respect of any 
     property situated within such foreign country and included in 
     the gross estate of a citizen or resident of the United 
     States, upon a transfer by the decedent for public, 
     charitable, or religious uses described in section 2055. The 
     determination under this paragraph of the country within 
     which property is situated shall be made in accordance with 
     the rules applicable under subchapter B (sec. 2101 and 
     following) in determining whether property is situated within 
     or without the United States. Any election under this 
     paragraph shall be exercised in accordance with regulations 
     prescribed by the Secretary.
       ``(2) Condition for allowance of deduction.--No deduction 
     shall be allowed under paragraph (1) for a foreign death tax 
     specified therein unless the decrease in the tax imposed by 
     section 2001 which results from the deduction provided in 
     paragraph (1) will inure solely for the benefit of the 
     public, charitable, or religious transferees described in 
     section 2055 or section 2106(a)(2). In any case where the tax 
     imposed by section 2001 is equitably apportioned among all 
     the transferees of property included in the gross estate, 
     including those described in sections 2055 and 2106(a)(2) 
     (taking into account any exemptions, credits, or deductions 
     allowed by this chapter), in determining such decrease, there 
     shall be disregarded any decrease in the Federal estate tax 
     which any transferees other than those described in sections 
     2055 and 2106(a)(2) are required to pay.
       ``(3) Effect on credit for foreign death taxes of deduction 
     under this subsection.--
       ``(A) Election.--An election under this subsection shall be 
     deemed a waiver of the right to claim a credit, against the 
     Federal estate tax, under a death tax convention with any 
     foreign country for any tax or portion thereof in respect of 
     which a deduction is taken under this subsection.
       ``(B) Cross reference.--

  ``See section 2014(f) for the effect of a deduction taken under this 
paragraph on the credit for foreign death taxes.''

       (6) Subparagraph (A) of section 2056A(b)(10) is amended--
       (A) by striking ``2011,'', and
       (B) by inserting ``2058,'' after ``2056,''.
       (7)(A) Subsection (a) of section 2102 is amended to read as 
     follows:
       ``(a) In General.--The tax imposed by section 2101 shall be 
     credited with the amounts determined in accordance with 
     sections 2012 and 2013 (relating to gift tax and tax on prior 
     transfers).''
       (B) Section 2102 is amended by striking subsection (b) and 
     by redesignating subsection (c) as subsection (b).
       (C) Section 2102(b)(5) (as redesignated by subparagraph 
     (B)) and section 2107(c)(3) are each amended by striking 
     ``2011 to 2013, inclusive,'' and inserting ``2012 and 2013''.
       (8) Subsection (a) of section 2106 is amended by adding at 
     the end the following new paragraph:
       ``(4) State death taxes.--The amount which bears the same 
     ratio to the State death taxes as the value of the property, 
     as determined for purposes of this chapter, upon which State 
     death taxes were paid and which is included in the gross 
     estate under section 2103 bears to the value of the total 
     gross estate under section 2103. For purposes of this 
     paragraph, the term `State death taxes' means the taxes 
     described in section 2011(a).''
       (9) Section 2201 is amended--
       (A) by striking ``as defined in section 2011(d)'', and
       (B) by adding at the end the following new flush sentence:
     ``For purposes of this section, the additional estate tax is 
     the difference between the tax imposed by section 2001 or 
     2101 and the amount equal to 125 percent of the maximum 
     credit provided by section 2011(b), as in effect before its 
     repeal by the Estate Tax Relief Act of 2000.''
       (10) Paragraph (2) of section 6511(i) is amended by 
     striking ``2011(c), 2014(b),'' and inserting ``2014(b)''.
       (11) Subsection (c) of section 6612 is amended by striking 
     ``section 2011(c) (relating to refunds due to credit for 
     State taxes),''.
       (12) The table of sections for part II of subchapter A of 
     chapter 11 is amended by striking the item relating to 
     section 2011.
       (13) The table of sections for part IV of subchapter A of 
     chapter 11 is amended by adding at the end the following new 
     item:

``Sec. 2058. State death taxes.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying after December 31, 
     2000.

     SEC. 6. VALUATION RULES FOR CERTAIN TRANSFERS OF NONBUSINESS 
                   ASSETS; LIMITATION ON MINORITY DISCOUNTS.

       (a) In General.--Section 2031 (relating to definition of 
     gross estate) is amended by redesignating subsection (d) as 
     subsection (f) and by inserting after subsection (c) the 
     following new subsections:
       ``(d) Valuation Rules for Certain Transfers of Nonbusiness 
     Assets.--For purposes of this subtitle--
       ``(1) In general.--In the case of the transfer of any 
     interest in an entity other than an interest which is 
     actively traded (within the meaning of section 1092)--
       ``(A) the value of any nonbusiness assets held by the 
     entity shall be determined as if the transferor had 
     transferred such assets directly to the transferee (and no 
     valuation discount shall be allowed with respect to such 
     nonbusiness assets), and
       ``(B) the nonbusiness assets shall not be taken into 
     account in determining the value of the interest in the 
     entity.
       ``(2) Nonbusiness assets.--For purposes of this 
     subsection--
       ``(A) In general.--The term `nonbusiness asset' means any 
     asset which is not used in the active conduct of 1 or more 
     trades or businesses.
       ``(B) Exception for certain passive assets.--Except as 
     provided in subparagraph (C), a passive asset shall not be 
     treated for purposes of subparagraph (A) as used in the 
     active conduct of a trade or business unless--
       ``(i) the asset is property described in paragraph (1) or 
     (4) of section 1221(a) or is a hedge with respect to such 
     property, or
       ``(ii) the asset is real property used in the active 
     conduct of 1 or more real property trades or businesses 
     (within the meaning of section 469(c)(7)(C)) in which the 
     transferor materially participates and with respect to which 
     the transferor meets the requirements of section 
     469(c)(7)(B)(ii).
     For purposes of clause (ii), material participation shall be 
     determined under the rules of section 469(h), except that 
     section 469(h)(3) shall be applied without regard to the 
     limitation to farming activity.
       ``(C) Exception for working capital.--Any asset (including 
     a passive asset) which is held as a part of the reasonably 
     required working capital needs of a trade or business shall 
     be treated as used in the active conduct of a trade or 
     business.
       ``(3) Passive asset.--For purposes of this subsection, the 
     term `passive asset' means any--
       ``(A) cash or cash equivalents,
       ``(B) except to the extent provided by the Secretary, stock 
     in a corporation or any other equity, profits, or capital 
     interest in any entity,

[[Page H4150]]

       ``(C) evidence of indebtedness, option, forward or futures 
     contract, notional principal contract, or derivative,
       ``(D) asset described in clause (iii), (iv), or (v) of 
     section 351(e)(1)(B),
       ``(E) annuity,
       ``(F) real property used in 1 or more real property trades 
     or businesses (as defined in section 469(c)(7)(C)),
       ``(G) asset (other than a patent, trademark, or copyright) 
     which produces royalty income,
       ``(H) commodity,
       ``(I) collectible (within the meaning of section 401(m)), 
     or
       ``(J) any other asset specified in regulations prescribed 
     by the Secretary.
       ``(4) Look-thru rules.--
       ``(A) In general.--If a nonbusiness asset of an entity 
     consists of a 10-percent interest in any other entity, this 
     subsection shall be applied by disregarding the 10-percent 
     interest and by treating the entity as holding directly its 
     ratable share of the assets of the other entity. This 
     subparagraph shall be applied successively to any 10-percent 
     interest of such other entity in any other entity.
       ``(B) 10-percent interest.--The term `10-percent interest' 
     means--
       ``(i) in the case of an interest in a corporation, 
     ownership of at least 10 percent (by vote or value) of the 
     stock in such corporation,
       ``(ii) in the case of an interest in a partnership, 
     ownership of at least 10 percent of the capital or profits 
     interest in the partnership, and
       ``(iii) in any other case, ownership of at least 10 percent 
     of the beneficial interests in the entity.
       ``(5) Coordination with subsection (b).--Subsection (b) 
     shall apply after the application of this subsection.
       ``(e) Limitation on Minority Discounts.--For purposes of 
     this subtitle, in the case of the transfer of an interest in 
     an entity, no reduction in the amount which would otherwise 
     be determined to be the value of such interest shall be 
     allowed by reason of the fact that the interest does not 
     represent control of such entity if the transferor and 
     members of the family (as defined in section 2032A(e)(2)) of 
     the transferor have control of such entity.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to transfers after the date of the enactment of 
     this Act.

     SEC. 7. TAX ON GIFTS AND BEQUESTS RECEIVED BY UNITED STATES 
                   CITIZENS AND RESIDENTS FROM EXPATRIATES.

       (a) In General.--Subtitle B (relating to estate and gift 
     taxes) is amended by inserting after chapter 13 the following 
     new chapter:

           ``CHAPTER 13A--GIFTS AND BEQUESTS FROM EXPATRIATES

``Sec. 2681. Imposition of tax.

     ``SEC. 2681. IMPOSITION OF TAX.

       ``(a) In General.--If, during any calendar year, any United 
     States citizen or resident receives any covered gift or 
     bequest, there is hereby imposed a tax equal to the product 
     of--
       ``(1) the highest rate of tax specified in the table 
     contained in section 2001(c) as in effect on the date of such 
     receipt, and
       ``(2) the value of such covered gift or bequest.
       ``(b) Tax To Be Paid by Recipient.--The tax imposed by 
     subsection (a) on any covered gift or bequest shall be paid 
     by the person receiving such gift or bequest.
       ``(c) Exception for Certain Gifts.--Subsection (a) shall 
     apply only to the extent that the covered gifts and bequests 
     received during the calendar year exceed $10,000.
       ``(d) Tax Reduced By Foreign Gift or Estate Tax.--The tax 
     imposed by subsection (a) on any covered gift or bequest 
     shall be reduced by the amount of any gift or estate tax paid 
     to a foreign country with respect to such covered gift or 
     bequest.
       ``(e) Covered Gift or Bequest.--
       ``(1) In general.--For purposes of this chapter, the term 
     `covered gift or bequest' means--
       ``(A) any property acquired by gift directly or indirectly 
     from an individual who, at the time of such acquisition, was 
     an expatriate, and
       ``(B) any property acquired by bequest, devise, or 
     inheritance directly or indirectly from an individual who, at 
     the time of death, was an expatriate.
       ``(2) Exceptions for transfers otherwise subject to estate 
     or gift tax.--Such term shall not include--
       ``(A) any property shown on a timely filed return of tax 
     imposed by chapter 12 which is a taxable gift by the 
     expatriate, and
       ``(B) any property shown on a timely filed return of tax 
     imposed by chapter 11 of the estate of the expatriate.
       ``(3) Transfers in trust.--
       ``(A) In general.--Any covered gift or bequest which is 
     made in trust shall be treated as made to the beneficiaries 
     of such trust in proportion to their respective interests in 
     such trust.
       ``(B) Determination of beneficiaries' interest in trust.--
     For purposes of subparagraph (A), a beneficiary's interest in 
     a trust shall be based upon all relevant facts and 
     circumstances, including the terms of the trust instrument 
     and any letter of wishes or similar document, historical 
     patterns of trust distributions, and the existence of and 
     functions performed by a trust protector or any similar 
     advisor.
       ``(f) Expatriate.--For purposes of this section, the term 
     `expatriate' means--
       ``(1) any United States citizen who relinquishes his 
     citizenship, and
       ``(2) any long-term resident of the United States who--
       ``(A) ceases to be a lawful permanent resident of the 
     United States (within the meaning of section 7701(b)(6)), or
       ``(B) commences to be treated as a resident of a foreign 
     country under the provisions of a tax treaty between the 
     United States and the foreign country and who does not waive 
     the benefits of such treaty applicable to residents of the 
     foreign country.''
       (b) Clerical Amendment.--The table of chapters for subtitle 
     B of such Code is amended by inserting after the item 
     relating to chapter 13 the following new item:

``Chapter 13A. Gifts and bequests from expatriates.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to covered gifts and bequests (as defined in 
     section 2681 of such Code, as added by this section) received 
     on or after May 25, 2000.
  The SPEAKER pro tempore. Pursuant to House Resolution 519, the 
gentleman from New York (Mr. Rangel) and a Member opposed, will each 
control 30 minutes.
  The Chair recognizes the gentleman from New York (Mr. Rangel).
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we have a decision today either to vote for the 
political solution to this problem that has been offered by the 
majority, where they know, and it is guaranteed, it would be vetoed 
even though they do not promise relief for another 10 years, or to vote 
for the substitute that gives immediate relief and they know, as I do, 
that it will be signed into law.
  Mr. Speaker, I yield 3 minutes to the gentleman from Maryland (Mr. 
Cardin), the senior member of the Committee on Ways and Means, who 
would explain more of this.
  (Mr. CARDIN asked and was given permission to revise and extend his 
remarks.)
  Mr. CARDIN. Mr. Speaker, I thank the gentleman from New York (Mr. 
Rangel) for yielding me this time.
  Mr. Speaker, when we started the debate an hour ago, the gentleman 
from Texas (Mr. Archer), my good friend, pointed out with pride that we 
have balanced the Federal budget and that was one of his objectives 
during his career. This is going to be his last year in this body and 
we certainly, all of us, appreciate his service to our country.
  But, Mr. Speaker, I would say to the gentleman that we want to make 
sure that we continue to balance the budget in the future. That is why 
I urge the gentleman to vote for the substitute.
  See, 10 years from now we want to also make sure that we also have a 
balanced Federal budget. Yet under the underlining bill, we will be 
losing $50 billion a year at that point. And I want to make sure that 
we have an affordable bill.
  During general debate, it was interesting that there was a lot of 
talk about the family-owned business and the family farm. As pointed 
out, only 2 percent of the estates are subject to the estate tax, and 
only 3 percent of that 2 percent have family farms or family-owned 
businesses. Well, the substitute deals with that by immediately, now, 
increasing the floor on those family assets to $4 million, taking 
almost all of the taxable farms and almost all of the taxable family-
owned businesses out of the estate tax.
  The underlying bill phases in over 10 years providing very low relief 
in the next few years. As we pointed out, if we look at an estate worth 
$1.5 million, under the substitute, because we immediately reduce the 
estate tax by 20 percent and we immediately increase the unified credit 
from $675,000 to $1.1 million, in that estate that is $1.5 million 
under the Archer bill, they would still pay $277,000 in estate tax next 
year.

                              {time}  1115

  But under the Rangel substitute, that tax would be only 135 percent, 
17 percent reduction versus a 60 percent reduction. We can do better, 
and the Democratic substitute does better.
  We also provide this in a fiscally responsible way. The Archer bill 
spends $105 billion over 10 years and then balloons to $50 billion a 
year. The Democratic substitute spends $22 billion over 10 years and 
does not balloon at all.
  The reason is that we close some loopholes in the estate tax. We not 
only provide relief, but we reform the estate tax. For those estates 
over $17 million who are receiving the benefit of a drafting error, we 
correct that. For those minority-owned stock that are currently getting 
unreasonable discounts, we correct that. So we provide

[[Page H4151]]

a fiscally responsible approach that deals with the problem.
  Yes, we have family farms that are suffering, suffering under some of 
our existing laws. But let us not help the .001 percent of the 
multimillionaires. Let us take care of those who really need it.
  Mr. Speaker, what concerns me is that if this bill became law, we are 
going to have the scandalous avoidance of tax by billionaires. At the 
same time, we are going to be jeopardizing our ability to pay Social 
Security and Medicare. I do not think any of us want to be in that 
position. Let us not create a scandal; let us do what is responsible. 
Let us deal with the problem; let us support the Democratic substitute.
  The SPEAKER pro tempore (Mr. Kolbe). Does the gentleman from Texas 
(Mr. Archer) seek the time in opposition to the amendment in the nature 
of a substitute?
  Mr. ARCHER. I do, Mr. Speaker.
  The SPEAKER pro tempore. The gentleman from Texas (Mr. Archer) is 
recognized for 30 minutes.
  Mr. ARCHER. Mr. Speaker, I yield myself such time as I may consume to 
simply very briefly say to the gentleman from Maryland (Mr. Cardin) he 
knows full well that nothing in this bill would jeopardize his Social 
Security or Medicare. That should never be inserted in this debate 
because nothing, nothing jeopardizes Social Security or Medicare in 
this bill.
  Mr. Speaker, I yield 4 minutes to the gentlewoman from Washington 
(Ms. Dunn).
  Ms. DUNN. Mr. Speaker, I might just mention that the gentleman who 
has just completed his speech has just experienced in his own State of 
Maryland the repeal of the death tax led by a Democrat legislature, a 
Democrat government, and led in particular by Obie Patterson, a liberal 
Democrat himself.
  Mr. Speaker, as much as it excites me to listen to the opposition 
talk about reducing the death tax, the substitute is a hollow attempt 
to make it look like we are providing relief. It does not do the trick 
here. Here are the four reasons why:
  First, and perhaps most importantly, it does not repeal the death 
tax. The substitute maintains the fundamental unfairness of the death 
tax. It says that, at the end of one's life, after one has worked hard, 
one puts one's heart and soul into building a business or a farm to 
provide a legacy for one's family, the Government still is entitled, 
in, many cases, to more than half of the fruits of one's labor.
  I cannot accept this because it is so grossly in violation of the 
fundamental virtues of this Nation: thrift, diligence, risk taking, 
hard work. Ninety-five percent of Americans believe it is wrong. 
Ninety-five percent of Americans, Mr. Speaker, believe that it is wrong 
to tax income during one's life and then tax the same assets again just 
because one dies.
  Secondly, the current death tax rates are the second highest in the 
industrialized world. The only nation that is higher than us in death 
tax is Japan at 70 percent. Under the substitute, the United States 
still would have the second highest death tax rate in the world, behind 
bastions of free market capitalism like France and Sweden. Our 
international competitors have recognized the unfairness of this tax. 
It is time now for the United States Congress to recognize it as well.
  Third, opponents of H.R. 8 say they can exempt family-owned farms and 
businesses by raising the family-owned business exception to $2 
million. It will not work. It has already been tried. It has already 
been proved to fail.
  Let me explain. When the Treasury Department came out with their 
figures saying that only 3 percent of estate tax returns are primarily 
composed of farm and business assets, I wanted to know what they 
wanted. I did not argue with their number. I wanted them to explain.
  So I called the Office of Tax Analysis at Treasury to ask them what 
their definition of ``primarily comprised'' is. Their answer? At least 
50 percent of the overall value of the estate.
  What the opponents of H.R. 8 do not tell us is that, in order to 
qualify for the family-owned business exemption, at least 50 percent of 
the overall value of the estate must be comprised of business or farm 
assets.
  What about the individual's home? How about the 401-K or any other 
savings? What about any assets in that estate that are not the business 
or the farm? This definition hurts especially small family-held farms 
and businesses.
  So if they do believe their Treasury numbers, which they must believe 
because they have been touting them throughout the debate, they must 
concede what we have always known, that only 3 percent of family farms 
and businesses will ever qualify for their relief. Their own Treasury 
analysis exposes the false relief they are proposing.
  Fourth and last, the substitute raises the death tax burden on all 
States at the same time it reduces rates. Under current law in States 
that still have estate tax laws, a family will receive a Federal death 
tax credit equal to their State death tax liability. This substitute 
eliminates the tax credit for States that have a death tax.
  The net result is that the substitute slightly reduces the rate, but 
this is offset by an increase in their death tax liability because of a 
loss of the credit.
  The substitute raises taxes, maintains high death tax rates, provides 
hollow relief for family farms and businesses. Most importantly, it 
retains the death tax.
  There is only one way to rid the Code of this immoral, unfair, 
onerous, economically unsound tax, and that is to eliminate it.
  I urge my colleagues to reject this substitute. Let us get rid of the 
death tax once and for all. Support H.R. 8.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from 
Texas (Mr. Stenholm).
  (Mr. STENHOLM asked and was given permission to revise and extend his 
remarks.)
  Mr. STENHOLM. Mr. Speaker, there is agreement from both sides of the 
aisle today that there are very real problems with the estate tax that 
we need to address.
  Some small businesses and family farms cannot be passed from 
generation to generation because the estate taxes imposed upon the 
death of the owner plays too great a financial responsibility burden on 
the remaining family. This is wrong.
  But I encourage my colleagues to examine carefully the substance of 
H.R. 8 and the Democratic alternative to see which proposal actually 
delivers the relief we all want to provide.
  I want to bring estate tax relief to the people I represent in the 
17th district of Texas. Family farmers and small business owners. But I 
want to do so from a fiscally responsible way, that which does not harm 
debt reduction or endanger necessary programs, such as defense, Social 
Security, Medicare, veterans programs. That is why I support the 
Rangel-Cardin-Stenholm substitute and oppose H.R. 8.
  Unlike H.R. 8, the Democratic alternative does not threaten Social 
Security and Medicare, with all due respect to the gentleman from Texas 
(Mr. Archer). The back-end loaded costs of the bill will threaten our 
ability to meet the challenges facing Social Security. This explosion 
in costs will come at the exact time the Social Security and Medicare 
trust funds will begin to face financial challenges and the Treasury 
will have to redeem the assets held by the trust funds to pay the 
benefits.
  The Democratic alternative provides immediate estate tax relief. The 
$4 million per family exclusion for farms and small businesses, the 20 
percent across-the-board rate reduction for all estates, and increase 
in the unified credit of $1.1 million in the Democratic alternative 
would all take effect immediately.
  By contrast, H.R. 8 would make small businesses and family farmers 
wait for 10 years to receive the amount of relief that would be made 
available January 1, 2001, under the Democratic alternative. I would 
ask my friends on the other side of the aisle, why should we make them 
wait 10 years before they get the relief we have all been talking about 
today?
  The Democratic alternative is much more fiscally responsible than 
H.R. 8. H.R. 8 would cause an enormous long-term revenue loss which 
will undermine the fiscal discipline that has produced a strong economy 
and jeopardized our ability to retire our national debt.
  Many of my colleagues have stood here and made statements that I 
totally agree with. It is not the Government's money; it is the 
people's money.

[[Page H4152]]

 But how quickly we forget it is the people's debt, $5.7 trillion. How 
quickly we ignore the Social Security unfunded liability of $7.9 
trillion when it comes to a tax cut that is politically popular to a 
few folks today.
  Let us stay with fiscal responsibility. The Democratic alternative 
does a much better job of targeting. It would immediately exempt 99 
percent, 99 percent of family farms and estates from estate taxes and 
reduce the number of estates subject to the estate tax by 50 percent.
  The Democratic alternative provides meaningful relief which can 
become law. We can give the relief that we are all concerned about and 
give it immediately. H.R. 8 will not do so.
  Mr. ARCHER. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from Florida (Mr. Shaw), a respected member of the Committee 
on Ways and Means, the chairman of the Subcommittee on Social Security.
  Mr. SHAW. Mr. Speaker, much has been said on this floor that is 
simply not true. What is threatening Social Security today? The 
inaction of the other side of the aisle, the uncooperative spirit, not 
all Members. I am not speaking to all Members there. But we have 
reached out to the Democrats time and time again with the Archer-Shaw 
proposal.
  We have been met with this wall of silence. We have reached out to 
the President who made this his big promise in facing the Nation, 
standing right behind where I am standing today. We have been met with 
a wall of silence. That is what is threatening Social Security today, 
not elimination of the death tax.
  What I think has been missing from this debate and is certainly 
missing from the substitute is the answer to the question that each 
Member should ask themselves as they come down here to vote today.
  Is the death tax a just tax? Should the event of death be taxed by 
the United States Congress and collected by the Internal Revenue 
Service? Should the family have to meet with the Internal Revenue 
Service the same day they meet with the undertaker? Is that a just tax? 
Is it a just tax? Is it a just tax that will destroy jobs and destroy 
businesses and destroy family farms? Is that a just tax? Is it a just 
tax to tax again at the highest rate that we have in our whole tax 
system, funds and wealth that has already been taxed by our income tax 
and God knows how many other taxes? Is that a just tax?
  I think the resounding answer is no. That is not a just tax. To say 
we are going to lessen the effect of it by the substitute that does not 
make it an even more or any more just tax. The fact that maybe the 
wealthy are getting, or top 2 percent are the only estates that are 
being taxed in this country, is that a reason to keep an unjust tax? 
That is not what this country is all about. That is not what this 
Congress is all about.
  Let us reject the substitute. Let us get rid of this unjust tax, and 
let us vote to repeal the death tax forever more.
  Mr. STENHOLM. Mr. Speaker, I yield 3 minutes to the gentleman from 
Massachusetts (Mr. Neal), a member of the Committee on Ways and Means.
  (Mr. NEAL of Massachusetts asked and was given permission to revise 
and extend his remarks.)
  Mr. NEAL of Massachusetts. Mr. Speaker, of all the taxes that could 
be repealed, this is perhaps one of the least justified. The rhetoric 
would state that the Federal Government is decimating the lives of 
millions of families yearly by snatching away their hard-earned savings 
just when they are most vulnerable, driving small business and farm 
families into oblivion while squeezing every penny possibly out of 
them.
  The facts have been stated before, but let me state them again. Only 
2 percent of the families are even subject to estate tax under current 
law. Of this 2 percent, only 3 percent are families with small 
businesses or farms. In other words, for every 10,000 estates, only six 
of them are farms or small businesses subject to the estate tax. To put 
it visually, if this piece of paper represents all estates, then this 
tiny part of it represents the issue in front of us today and what we 
are about to do.
  Of course half of the people in my district think they are going to 
pay. That misconception is what makes this work politically. 
Acknowledging reality, however, does not mean that there are no steps 
we can take to ease the problem for those who are subject to the estate 
tax or ease the minds of those who think they are. Those steps are 
represented today by the Democratic substitute.
  Our substitute reduces the maximum tax rate by 20 percent to 44 
percent. It increases the current $1.3 million exclusion to small 
businesses and farms to $4 million for a married couple, and it 
immediately increases the general exception to $1.1 million.
  I had some small businessmen come by the other day. I explained to 
them what we were about to do. They said that is more than we need, 
based on the approach by the gentleman from New York (Mr. Rangel).
  I came to Congress in 1988, but even I remember a time when a Member 
could get something into a House bill, see it dropped in conference and 
feel bad about it. Now Members seem to crow about getting a bill to 
pass the House that everyone knows is designed to die.

                              {time}  1130

  In Washington, representatives do their clients and we do our 
constituents a disservice by participating in such a farce. We face a 
choice: Support a compromise that provides significant relief for all 
estates, but especially small businesses and family farms; or kill the 
bill once again around here and get nothing. That is the vote on the 
floor today.
  I suspect the majority intend to vote to kill the bill and get 
nothing. But, my God, let us not ask for credit for having done that.
  Mr. ARCHER. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
Missouri (Mr. Hulshof), another respected and distinguished member of 
the Committee on Ways and Means.
  Mr. HULSHOF. Mr. Speaker, I thank the gentleman for yielding me this 
time, and, Mr. Speaker, a recent editorial in the Washington Post 
earlier this week denounced our actions today and the title of the 
editorial was Government by Bumper Sticker. And, of course, the 
editorial set out many of the same arguments we have heard from those 
on the other side.
  I guess if I were to think of a bumper sticker, it would be one I saw 
over the break of the Memorial Day recess. The bumper sticker on the 
back of this RV traveling the highways of Missouri said, I am spending 
my kids inheritance. Now, I will confess, I took a quick double take to 
make sure the occupants of that RV were not my own parents on a cross-
country spending spree. But then I began to think about the gist of 
that sticker, and how it is that in some instances it is cheaper to 
dispose of family assets before death than passing it on to our 
descendants and making them sell off those family assets after death.
  I suppose our friends on the other side will say we should take some 
solace in the fact that at least predeath that they are enjoying the 
fruits of their labor rather than collecting those fruits, bringing 
them here to Washington and then letting 535 Members of the House and 
Senate decide how to spend the fruits of those labors. But I say, no. 
And with all due respect, and with high regard for my friend from New 
York and his substitute, I guess if I were to pick a bumper sticker for 
the substitute it would be Mend It, Don't End It.
  I would ask the gentleman and everybody that would say we should not 
have a complete repeal to justify for me the continuation of the 
inheritance tax. And I see my friend from Vermont would like to justify 
for us why he believes we should not do that, and I will let him do so 
on his time, but knowing his political ideology, I imagine it would be 
that we should redistribute wealth in this country. And I appreciate 
that, yet we already have a redistribution of wealth in this country 
through the progressive tax rates and the fact that we deny tax 
deductions and credits for those that are successful in this country.
  What has not been discussed here is the economic cost of compliance 
and avoidance of the tax. The fact is that the Joint Economic Committee 
says that in 1998, $23 billion were spent to avoid the tax. The same 
amount that we generated in revenue. My colleagues, it is time to be 
bold. And with

[[Page H4153]]

all due respect to the substitute and the intent behind it, if I were 
again to pick out a bumper sticker that I support it would be ``It's 
Time to Give the Death Penalty to the Death Tax.'' Reject the 
substitute and vote in favor of H.R. 8.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from 
Vermont (Mr. Sanders) in order to respond to the previous speaker.
  Mr. SANDERS. Mr. Speaker, the gentleman said, well, why should we not 
repeal the estate tax. Let me tell him why. There are millions of 
Americans in this country, senior citizens, who suffer and die because 
they cannot afford prescription drugs. And this country does not have a 
strong program to say to the sick that they can get the prescription 
drugs they need without taking money out of their food budget.
  What the gentleman is doing today is giving the wealthiest 2 percent 
of the population, billionaires, a huge tax break. And then my 
colleagues will come before the American people and say, gee, we do not 
have the money to protect the sick and the old.
  In my district there are middle-class families who are going deeply 
into debt so that they can send their kids to college, and some of 
these kids graduate college $50,000 in debt. And what my colleagues are 
saying today is, hey, Bill Gates and his friends, who contribute huge 
amounts of money to the political process, to the Republican Party, 
they need a tax break. I say that is immoral.
  There are families in this country who work 40 hours a week and they 
sleep in their cars because we have not put money into affordable 
housing. Yet my colleagues say, hey, I have millionaire friends who 
have gone to a $25,000 a plate fund raiser, we have to give them a tax 
break. And my colleagues say, we do not have money for affordable 
housing, we do not have money for education. There are 44 million 
people in this country who have no health insurance, but my colleagues 
say we cannot afford that because they are too busy giving tax breaks 
to the richest people in this country.
  I have heard my Republican friends use the word immoral and unjust to 
describe the estate tax. I will tell them what is immoral and unjust. 
It is immoral and unjust that we give tax breaks to those people who do 
not need it while we ignore the suffering of millions and millions of 
people who need help today. That is why.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentlewoman from 
North Carolina (Mrs. Myrick).
  Mrs. MYRICK. Mr. Speaker, I would like to share a poem that I think 
says it all in our debate today.

     Tax his cow, tax his goat, tax his pants, tax his coat;
     Tax his crops and tax his work, tax his tie and tax his 
           shirt;
     Tax his shoe, tax his smoke, teach him taxes are no joke;
     Tax his tractor, tax his mule, teach him taxes are the rule;
     Tax his oil, tax his gas, tax his notes, and tax his cash;
     If he hollers, tax him more, tax him till he's good and sore;
     Tax his coffin, tax his grave, put these words upon his tomb: 
           ``Taxes drove me to my doom.''
     After he's gone, he can't relax, they'll still go after Death 
           tax.

  I would like to urge all my colleagues to vote against the Rangel 
substitute.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentlewoman from 
Florida (Mrs. Thurman), a member of the Committee on Ways and Means.
  Mrs. THURMAN. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Over the years, Mr. Speaker, all of us have heard from small business 
owners and family farmers who want to pass on to their descendents the 
fruits of their labor, and I empathize with them. And I have worked, as 
many of us have, to have estate tax relief for them. Particularly, and 
most noted, was the Taxpayer Relief Act of 1997. The law specifically 
helps owners of small businesses and family farmers.
  But like many of my colleagues, I want to provide more help to those 
involved in family farms or small businesses. So this year, once again, 
I would like to support a fiscally responsible alternative that focuses 
estate tax relief where it is needed. The alternative would cut estate 
tax 20 percent across the board, reducing the maximum rate to 44 
percent. The proposal would provide a transferable $2 million exclusion 
for farms and small businesses. That means a married couple with a farm 
or a small business would receive a $4 million estate tax exclusion.
  Mr. Speaker, I urge my colleagues, especially those in agriculture, 
to see what the alternative means for them. Based on a 1998 USDA 
survey, only 1.5 percent of farms have a net worth of more than $3 
million. In other words, more than 98 percent of the farmers benefit 
from the alternative that I am going to support.
  The alternative has three other advantages over H.R. 8. First, it 
takes effect, which we have heard, in 2001 rather than in 10 years. If 
a person happens to die before 2010, that person's heirs will not enjoy 
the full benefit of H.R. 8. Second, it costs far less than H.R. 8; 
around $2 billion a year. Finally, we have heard, unlike H.R. 8, the 
alternative could be signed into law.
  Let us look at the cost factor. By the time it is fully implemented 
in 2010, H.R. 8 will cost $50 billion a year. If the House were really 
interested in helping the living, it might have considered using the 
money in other ways. A bipartisan bill I am going to talk about with 
people on Ways and Means is H.R. 957. I talked to my farmers. They need 
relief today, not when they are dead. They said, give me the farm and 
ranch risk management, which I have supported and introduced with my 
fellow Republicans, which would give all growers an ability to defer 
taxes in good years and use the money in lean years. This bill costs 
$100 million a year, not billions.
  There are all sorts of other bills, including one to provide a 
capital gains tax exclusion for farms similar to the ones given on 
homes. Well, we cannot find the funds for these and other proposals to 
help businesses, but we can find $104 billion in H.R. 8. But if H.R. 8 
is vetoed, then thousands of taxpayers who operate family businesses 
gain nothing.
  I wonder which is better for family businesses, a bill that will not 
become law or a bill that helps them?
  Mr. ARCHER. Mr. Speaker, I yield 1\1/2\ minutes to the gentlewoman 
from North Carolina (Mrs. Clayton).
  Mrs. CLAYTON. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, this bill is a proposal to eliminate the estate tax in 
the future. The bill and the Democratic alternative will allow the 
continuation of something and the beginning of something. These are 
proposals to maintain small family farms and small family businesses. 
These are proposals that preserve the important past by protecting the 
precious future.
  I intend to vote for both proposals. The Democratic alternative 
provides greater relief, more immediately. Providing up to $4 million 
would indeed help many small farmers and small businesses. H.R. 8, on 
the other hand, would repeal the tax all together. That is an 
attractive proposal. It is also, we must recognize, is a costly 
proposal.
  As we seek to save the small family farm or business, we must also 
make sure we do not sacrifice Social Security, Medicare, or other 
progress made in reducing and eliminating the debt. I am hopeful that 
as we proceed with this legislation to provide estate tax relief, we 
will continue our fiscal responsibility.
  Reducing or eliminating the estate tax is an essential thing to do. 
It is the prudent thing to do. It is the right thing to do. By doing 
what is prudent and right, we can ensure that the lifeblood of many 
American families, the small farm and the small business, will continue 
to survive.
  Mr. RANGEL. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
New Jersey (Mr. Rothman).
  Mr. ROTHMAN. Mr. Speaker, I thank the gentleman from New York for 
yielding me this time.
  My friends, the American estate tax system is 85 years old. Who 
supported the creation of the American estate tax system? Well, one of 
the first supporters was Republican President Theodore Roosevelt. Why 
would he do such a thing? Well, he did not want to have two America's, 
a have and a have not. What do we have today in America? We have a 
nation where the top 1 percent of our people, the top 1 percent, own 40 
percent of the Nation's assets, twice the amount held by them in the 
past 20 years.

[[Page H4154]]

  Today, my friends, the House has a choice: The Democrat plan to 
reform the estate tax system, a reform plan that would leave 99 percent 
of Americans paying no estate tax and still cutting the estate tax for 
the top 1 percent; or the Republican plan, on the other hand, which 
adds another $40 billion in cost a year in order to eliminate the tax 
for the top 1 percent.
  My friends, I believe that most Americans feel that that $40 billion 
extra would be better spent going to save Social Security and Medicare, 
or paying down our $5.6 trillion national debt, which is now being 
assumed by our children, or providing prescription drugs for our 
seniors, strengthening our military, fixing our public schools and 
providing health care for 45 million uninsured Americans.
  The time may come when our country can afford to entirely eliminate 
the estate tax for the top 1 percent, but not today. Let us eliminate 
taxes for 99 percent of Americans, cut taxes for the top 1 percent, and 
pass the Democrat reform plan.
  Mr. ARCHER. Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from 
Louisiana (Mr. McCrery), another respected and distinguished member of 
the Committee on Ways and Means.
  Mr. McCRERY. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Several Members in support of the Rangel substitute, Mr. Speaker, 
have begged us to adopt the Rangel substitute because their farmers 
need help now. Well, I find it curious that the Farm Bureau has 
endorsed not the Rangel substitute but the underlying bill, which I 
hope will pass this House today. That is real relief to farmers, not 
the Rangel substitute.
  Let me talk about why that is. Three years ago, in 1997, I was the 
author of a bill to do what the Rangel substitute attempts to do today; 
that is to give a higher exemption, so to speak, to family farms, 
family businesses from the estate tax. I pursued that course for two 
reasons. Number one, in 1997, we were not expecting the huge surpluses 
at the Federal level that we are today. We had very much more limited 
revenue over expenditures to work with for any tax cuts. So I chose a 
route to try to do the most good with the estate tax that I could with 
the limited dollars that we had to spend. And the route I chose was to 
try to direct the relief at family farms and family-held businesses.
  We got a lot of support for that route. We finally got some of my 
bill into the tax bill that was signed by the President in 1997, and 
that became law. And since then, those family farms and family 
businesses have been eligible for a higher exemption from the estate 
tax than everybody else. Unfortunately, I was wrong in 1997. That 
relief that we tried to give family businesses and family farms has not 
taken place. Why? The Committee on Ways and Means heard testimony last 
year from tax experts and, indeed, from the National Federation of 
Independent Businesses, who had backed my proposal in 1997, and they 
told us that that attempt to exempt family farms and businesses from 
part of the estate tax has not worked because it is too complex.
  There is no way to ensure that a family looking forward can comply 
with all of the requirements that are necessary to qualify for that 
exemption. As a consequence, we just have not been able to bring those 
family farms and businesses under this exemption. It was well-
intentioned, I was well-intentioned in 1997, I think it is well-
intentioned today, but it will not work.
  So I will ask my colleagues in this House to reject the attempt of 
the gentleman from New York (Mr. Rangel) to simply expand on the failed 
attempt that I made in 1997 to help family farms and businesses and, 
instead, to go with the Archer bill today that repeals the estate tax 
once and for all. We phase it in over 10 years. It is a responsible 
plan. We have the revenue to do it, and there is no reason to continue 
this extremely unfair, I would submit the most unfair, part of our Tax 
Code.
  Mr. RANGEL. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Maine (Mr. Allen).
  Mr. ALLEN. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Here we go again, another week, another irresponsible Republican tax 
cut. Now, I believe that we do need to provide immediate estate tax 
relief for those who own family businesses, but this Republican repeal 
of the estate tax costs so much, $50 billion a year when fully phased 
in, that it does threaten Social Security and Medicare, and makes much 
less likely the chance that we will provide prescription drug coverage 
for our seniors.
  Now, I have talked to a lot of small business owners in my district 
of Maine, and the stories they tell are compelling, and Congress should 
do more to lift the tax burden on these essential family businesses, 
family businesses that make up a large part of the life of our smaller 
communities. The Democratic alternative would provide immediate tax 
relief to closely-held businesses and family farms by reducing all 
estate tax rates 20 percent across the board and increasing the small 
business exclusion to $4 million per family. This Democratic 
alternative is a step in the right direction and provides more 
immediate relief than the Republican plan.
  Now, let us be clear. The President will veto H.R. 8. So the choice 
for us today is clear: An irresponsible tax plan, with costs that 
explode in the future, threatening Medicare and Social Security for the 
baby-boom generation; or a bipartisan plan that will provide immediate 
tax relief to those who truly need it.
  Vote ``yes'' on the Democratic substitute and reject H.R. 8.
  Mr. ARCHER. Mr. Speaker, may I inquire how much time remains on each 
side?
  The SPEAKER pro tempore (Mr. Kolbe). The gentleman from Texas (Mr. 
Archer) has 14\1/2\ minutes, and the gentleman from New York (Mr. 
Rangel) has 13 minutes.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Cox).

                              {time}  1145

  Mr. COX. Mr. Speaker, it has been instructive to listen to the 
debate, because we are coming together, Democrats and Republicans, to 
appreciate that the death tax is unfair. It is unfair, because it is a 
double tax on the aftertax lifesavings of an individual.
  The only cavil that seems to be, not all but some Members on the 
minority side have is, first, that the death tax is expensive, by which 
they mean it raises revenue that we might lose if we repeal it, and, 
second, that it is a way to keep us from having two Americas of haves 
and have nots.
  But the truth is the death tax is expensive in a way that perhaps 
these people do not quite apprehend. It is expensive to collect. Every 
time we try to collect the death tax, we get thrown into a lawsuit that 
lasts for years. It is one of the most expensive taxes to collect that 
we have on the books.
  It reduces other taxes, such as income taxes that we collect, because 
as a tax avoidance scheme, people give away money during life and, 
thus, reduce, because they get a deduction, they reduce the taxes that 
otherwise they might owe.
  The Secretary of the Treasury, Lawrence Summers, in fact told us this 
when he was a Harvard economist just a few years ago that this tax 
might very well lose money for the Federal Government. So by repealing 
it, we should not worry that it is too expensive. The only expense that 
we are relieving is that on the American people. Second, this tax which 
was meant 85 years ago by Teddy Roosevelt to avoid undue concentration 
of wealth has resulted in just the opposite. We break up, not 
concentrations of wealth, but farmers and small businesses which are 
acquired by multinational corporations and real estate developers. That 
is why environmental groups are supporting complete repeal.
  The substitute would keep all the complexities of the more than 80 
pages of the Internal Revenue Code that are devoted to the death tax. 
When tax simplification is the cry of the American people, this is the 
best opportunity that we will have to achieve that result.
  The substitute would raise taxes on families by repealing the current 
tax credit for State taxes. Let us not raise taxes. Let us cut them. 
Let us eliminate complexity. Let us do the right thing. Vote down the 
substitute and vote aye on H.R. 8.
  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from 
Massachusetts (Mr. Capuano).

[[Page H4155]]

  Mr. CAPUANO. Mr. Speaker, I just rise to ask a few questions. I have 
heard an awful lot of comment today about how immoral, unethical, and 
somehow evil the estate tax is. Well, obviously, we can have 
philosophical agreements, but I would ask if that is the case, as of 
right now today, there are 16 States that have their own estate tax of 
significant nature, 7 of those have a complete Republican-controlled 
legislature and governor, none of them have repealed it.
  Are they completely immoral and unethical, or are they just wrong? If 
they are just wrong, maybe we better get on the phone and call them and 
tell them that. And when we do, maybe we need to suggest to them how 
they are going to raise the $6 billion that they raised in the last 
year to pay for policeman, fireman, teachers and et cetera.
  And on top of that, I just want to repeat what I said earlier, it is 
not a 50 percent tax, it is a 20 percent tax at this point. The 
democratic substitute will lower it to a 16 percent tax. The average 
person after tax, after tax, the average person who is subject to this 
tax will still have $2.7 million left. My gosh, how difficult it must 
be to get by on that amount of money.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to another respected and 
distinguished member of the Committee on Ways and Means, the gentleman 
from Michigan (Mr. Camp).
  Mr. CAMP. Mr. Speaker, I thank the gentleman from Texas (Mr. Archer), 
for yielding me the time, and I thank him for his leadership on this 
very important issue.
  Mr. Speaker, I rise in strong support of H.R. 8, a bill to repeal the 
death tax. Small businesses and family farms are the lifeblood of our 
economy. Yet we have a tax system which unfairly taxes these small 
business employers and farmers twice. Less than half of all family-
owned businesses survive the death tax and only about 5 percent survive 
to the third generation.
  After being taxed two, three or four times, Uncle Sam taxes us again 
at 55 percent when we die. At a time when families need to be thinking 
about what they can do to bounce back from such a tragedy, they have to 
worry about taxes. Fiftyfive percent is high enough, but it is 100 
percent penalty on employees of small businesses and family farms who 
lose their jobs when their company or farm is liquidated to pay the 
death tax.
  Since its beginning, America has been about building a better life 
for people and their children. A farmer's commitment to not sell his 
farm, to invest his profits in his farm, and to continue working 
instead of retiring, that is what America is all about. And there is 
nothing more un-American than telling that farmer and family, you are 
going to have to give the fruits of your labor and your children's 
future to the government.
  Mr. Speaker, death by itself should not trigger a tax. The 50,000 
farmers in Michigan deserve to have this tax repealed. Let us give them 
the opportunity to focus their attention on building their farms and 
providing for their children, rather than figuring out to avoid losing 
their farm to the government.
  Mr. RANGEL. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Indiana (Mr. Hill).
  Mr. HILL of Indiana. Mr. Speaker, I thank the gentleman for yielding 
me the time.
  Mr. Speaker, I respect thousands of family farmers in southern 
Indiana. I have family members who operate family farms. I understand 
how the estate tax can cause a lot of hardship for asset-rich and cash-
poor family farms. It sometimes can prevent farmers from passing their 
farms on to their children which is a real tragedy.
  I support the substitute to this bill, because it sends immediate 
estate tax relief for the family farmers and small businesses who 
really need it. The majority proposal requires farmers and small 
businesses to wait 10 years for estate tax relief. Family farmers and 
small business operators need estate tax relief now, not 10 years from 
now.
  Mr. Speaker, I also support the substitute to H.R. 8, because unlike 
the Majority proposal, it offers estate tax relief in a fiscally 
responsible way. When it is fully implemented, H.R. 8 will costs $50 
billion a year which threatens our hard-won balanced budget.
  I believe it is more important to continue paying down the national 
debt and protecting Social Security and Medicare than giving a tax 
break to people whose estates are worth tens or even hundreds of 
millions of dollars.
  Mr. Speaker, I urge my colleagues to support the substitute.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Arizona (Mr. Hayworth), a respected and distinguished member of the 
Committee on Ways and Means.
  Mr. HAYWORTH. Mr. Speaker, I thank the gentleman from Texas (Mr. 
Archer), the chairman of the Committee on Ways and Means for yielding 
me the time, and I rise in opposition to the substitute offered by the 
ranking member of our committee.
  Here is the fundamental reason why I rise in opposition:

                              {time}  1200

  Mr. Speaker, this would leave in place all the intricacies, the 
infrastructure, if you will, in law of the death tax. There are those, 
as has been aptly illustrated in this body, there are those intent on 
raising taxes. There are those who believe in a radical redistribution 
of wealth, and those who have stood to defend the death tax essentially 
are accepting the notion of double taxation. This keeps in place all of 
the complexities, and it would actually raise taxes on families by 
repealing the current tax credit for State taxes. So that is something 
very, very important to remember.
  The other thing I would point out today to the body, Mr. Speaker, is 
that having listened with interest to my good friend who joined us from 
Indiana and who offered his point of view on this, if the substitute is 
such a good idea, why does the American Farm Bureau embrace the 
complete repeal of the death tax? Why does the National Hispanic 
Chamber of Commerce, why does the National Black Chamber of Commerce 
join with a bipartisan majority to embrace total repeal of the death 
tax? It is because of efforts, well-intentioned though they may be, by 
some on the left to leave in place the infrastructure and bit by bit, 
brick by brick, element by element, reintroduce and expand the death 
tax.
  I would remind our body collected here today, Mr. Speaker, that 
during a previous Congress, indeed, the 103d Congress, there was a move 
afoot to expand death taxes. We do not want that. Let us repeal the tax 
and vote against the substitute.
  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from 
California (Ms. Millender-McDonald).
  Ms. MILLENDER-McDONALD. Mr. Speaker, I thank the gentleman for 
yielding me this time. I rise today in strong opposition to H.R. 8 and 
in strong support for the Democratic substitute.
  Once again, the Republicans have shown us their recklessness by 
spending the budget surplus on an irresponsible tax cut for their 
special interest allies with no investment in Social Security and 
Medicare. Furthermore, just yesterday we were here discussing the 
massive cuts to our Education, Health and Labor Departments. How can we 
today stand here in good conscience and debate spending $105 billion on 
tax cuts when yesterday we could not even guarantee that all of our 
children will have a quality education in this, the richest country in 
the world.
  Mr. Speaker, I strongly support providing relief to smaller estates, 
family-owned small businesses and farms; but I believe that we can do 
this in a more fiscally responsible way with targeted relief. The 
Republican bill does not represent targeted relief; it represents 
preferential treatment. It seeks to benefit only 2 percent of 
Americans, and yet, with H.R. 8, it is evident that the Republicans 
feel that only 2 percent of Americans should be represented.
  Well, I am here representing the other 98 percent, and I say no to 
H.R. 8.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from North 
Carolina (Mr. Coble).
  Mr. COBLE. Mr. Speaker, I thank the gentleman for yielding me this 
time. I commend him and his very fine leadership on this, what I have 
called, traditionally, the most onerous tax in the Code. It is a 
disincentive against savings, a disincentive against investing.
  I have heard countless presentations from this floor yesterday and 
today about horror stories where people who are not wealthy by any 
means have

[[Page H4156]]

been devastated as a result of the imposition of the estate tax. Call 
it the estate tax, call it the inheritance tax, but call it what it is: 
the death tax. Mr. Speaker, I commend the chairman of the Committee on 
Ways and Means and our Democrat friends that have supported us in this 
bill. This is a bill that is long, long overdue and should be enacted; 
and I urge its support.
  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Connecticut (Ms. DeLauro).
  Ms. DeLAURO. Mr. Speaker, the Democratic substitute provides targeted 
tax relief for middle-class families, small business owners, and 
farmers without putting at risk or fiscal discipline, our investments 
in education, and targeted tax relief that we could be providing to 
America's middle-class families.
  The Republican tax break is another example of their misguided 
priorities. Before they have done anything to strengthen Social 
Security and Medicare or provide a prescription drug benefit for our 
seniors, they provide a tax break to the wealthiest 2 percent of all 
Americans who control 40 percent of the wealth in this Nation. It comes 
out to $105 billion over the next 10 years, over $50 billion in tax 
cuts to the richest people in the United States. That is their idea of 
tax fairness: millions for the rich, not a penny for the middle class.
  We have heard a lot about family farms and small businesses. Well, 
the Democratic tax cut ensures that the family farm will be passed on. 
It guarantees small businesses can continue as family-owned businesses. 
It provides immediate tax relief to these families, and it does this 
without squandering our surplus, undermining Social Security and 
Medicare, or risking our investments in education, health for our 
seniors. Vote for the Democratic substitute.
  Mr. ARCHER. Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Florida (Ms. Brown).
  Ms. BROWN of Florida. Mr. Speaker, do not be fooled by the 
spinmasters on the right. They are solving a problem that does not even 
exist, while the poorest in America who do not enjoy our great 
prosperity continue to be ignored by the leadership of this House.
  We need real priorities: the Older Americans Act, which provides 
meals and other services to our seniors. Priorities: the Ryan White 
Care Act, which provides health care and medication for children 
suffering from AIDS remains to be reauthorized. Priorities: the 
Patient's Bill of Rights, which is supported by an overwhelming 
majority of Americans, still sits in conference.
  The multimillionaires can take care of themselves. Let us pass 
legislation that really helps the working families, not helping the 
rich get richer under the House leadership.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Gary Miller).
  (Mr. GARY MILLER of California asked and was given permission to 
revise and extend his remarks.)
  Mr. GARY MILLER of California. Mr. Speaker, it is amazing, the people 
that talk about how can we risk this much money on a risky tax scheme. 
Let me read a letter from somebody who has been impacted by this death 
tax, and then my colleagues can come back and say it is a risky tax 
scheme.
  ``Today marks the first day of the ninth month since my dad passed 
away. He was a physician specializing in chemotherapy treatments for 
cancer patients. He grew up in a very poor family in Brooklyn, New York 
and he still managed to put himself through school and become a doctor, 
without any help from government, I might add. His plan was to retire 
this summer, after doing so much good for his patients and our 
community, and spend the time sailing on his 15-year-old, 27-foot 
sailboat that he bought 2 weeks before he died. He paid untold sums of 
money in taxes throughout his lifetime while working to the age of 65, 
a requirement necessary to save enough money to retire at a financial 
level that a physician deserves. While paying 50 percent of his income 
in taxes to the government, money that might otherwise have been used 
to fund an early retirement, he died.
  ``I am his son and executor of the estate that he worked so hard 
saving for and did not get to enjoy. Today, I am going to have the 
pleasure of writing 2 checks totaling nearly $1 million divided between 
the State and Federal Government. This is the most revolting and 
disgusting thing that I have ever had to do. When the CPA told me how 
much money the death penalty imposes on my dad's estate, I literally 
almost threw up. As a result of my dad's strong desire to save for his 
retirement, the majority of his estate is in Individual Retirement 
Accounts, and you know the tax consequences that creates when 
distributed to heirs, right? After all is said and done, the government 
will have taken over 50 percent of my dad's property and money.
  ``I adamantly believe that the government's only societal role is to 
protect the rights, lives and property of law abiding citizens. Period. 
All socialized legislation beyond that is an unnecessary intrusion into 
my life and a waste of my money.
  ``The government already confiscates too much money through taxation 
by means of income tax, property tax, capital gains tax, gasoline tax, 
Social Security tax, Medicare tax, telephone tax, hotel tax, airline 
ticket tax, energy tax, entertainment tax and numerous other hidden 
excise taxes that I continuously pay.
                                        Upland, CA, March 6, 2000.
     Representative Gary Miller,
     Diamond Bar, CA.
       Dear Representative Miller, Today marks the 1st day of the 
     9th month since my dad passed away. He was a physician 
     specializing in chemotherapy treatments for cancer patients. 
     He grew up in a very poor family in Brooklyn New York, and he 
     still managed to put himself through school and become a 
     doctor, without the help of the government I might add. His 
     plan was to retire this summer, after doing so much good for 
     his patients and our community, and spend time sailing the 15 
     year old 27 foot sailboat he bought two weeks before he died. 
     He paid untold sums of money in taxes throughout his lifetime 
     while working to the age of 65, a requirement necessary to 
     save enough money to retire at a financial level that a 
     physician deserves. While paying 50% of his income in taxes 
     to the government, money that might otherwise have been used 
     to fund an early retirement, he died.
       I am his son and executor of the estate that he worked so 
     hard saving for and didn't get to enjoy. Today I am going to 
     have the pleasure of writing two checks totaling nearly one 
     million dollars between the state and federal government. 
     This is the most revolting and disgusting thing that I have 
     ever had to do. When the CPA told me how much money the death 
     penalty imposed on my dad's estate, I literally almost threw 
     up. I was sick to my stomach. As a result of my dad's strong 
     desire to save for his retirement the majority of his estate 
     is in Individual Retirement Accounts and you know the tax 
     consequences that creates when distributed to heirs, right? 
     After all is said and done, the government will have taken 
     over 50% of my dad's property and money.
       I adamantly believe that the government's only societal 
     role is to protect the rights, lives, and property of the law 
     abiding. Period. All socialized legislation beyond that is an 
     unnecessary intrusion into my life and a waste of my money.
       The government already confiscates too much money through 
     taxation by means of Income tax, Property tax, Capital Gains 
     tax, Gasoline tax, Social Security tax, Medicare tax, 
     Telephone tax, Hotel tax, Airline Ticket tax, Energy tax, 
     Entertainment tax and numerous other hidden Excise taxes that 
     I continuously pay.
       Having stated that, and inasmuch as you are supposed to be 
     representing me, can you write me back with even one good 
     reason that validates the usurpation of one million dollars 
     that was left by my dad, to my family?
           Sincerely,
                                                  Todd M. Kolbert.

  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from Texas 
(Mr. Rodriguez).
  Mr. RODRIGUEZ. Mr. Speaker, how irresponsible have we become? How 
greedy have we become? We all pay taxes; we all have a responsibility 
to pay down the debt. This is irresponsible, and it is a callous 
disregard for all Americans, when we only favor the top 2 percent of 
the richest.
  Let us cut the taxes on all Americans, not just on the richest 2 
percent of this country. The top 1 percent own 40 percent of the 
assets. This piece of legislation would even cause the divide to even 
be more between the haves and the have-nots. This is un-American, it is 
unfair, it is unethical and irresponsible. It is heartless, to think 
that we are going to be giving $50 million to the top 2 percent richest 
when, at the same time, we have said no to our veterans. This same 
Congress has said no to our veterans. When we have promised them access 
to health care, we

[[Page H4157]]

have said no. We have been unwilling to give them that $5 billion that 
they need; yet we say yes to the 2 percent of the richest of this 
country when we say that we are going to give them $50 billion.
  Mr. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Illinois (Mr. Ewing).
  Mr. EWING. Mr. Speaker, I thank the chairman for yielding me this 
time. I rise in support of H.R. 8, the Death Tax Elimination Act.
  This is one of the worst taxes we have in America. America is 
renowned as the place where through hard work and sacrifice an 
individual can make a better life for himself and his family. We have 
an entrepreneurial spirit that is unmatched in any other country, and 
it is because of the ability to make it here in this country.
  What is the trouble with the Federal estate tax? It does away with 
that. It kills small businesses; it kills the family farm. I say to my 
colleagues, my constituents who are not wealthy want that ability, and 
most Americans do. I say we should pass this bill, we should vote 
against the substitute, and we should eliminate the death tax in 
America.
  Mr. Speaker, I rise today in support of H.R. 8, the Death Tax 
Elimination Act of 2000. The death tax is one of the most onerous taxes 
levied upon our citizens and is in complete contrast to the principles 
upon which this country was based. America is renowned as a place where 
through hard work and sacrifice, an individual can make a better life 
for himself and his family. We have an entrepreneurial spirit that is 
unmatched in any other country and we need to ensure that spirit 
remains.
  That is what is so troubling about the Federal estate tax. It does 
not encourage hard work and entrepreneurship, but rather discourages 
it. The only message that the estate tax sends is that if you are hard 
working and industrious we will not reward you, we will punish you. 
This clearly is not the message we need to be sending.
  Currently, small businesses and farms are being hit the hardest by 
this unfair burden. Heirs sometimes are forced to liquidate businesses 
just to pay estate taxes. Allow me to provide you with a personal 
example of the negative effects of this tax.
  In my district there is a business called Niemann Foods which runs a 
small chain of grocery stores. This company was founded in 1917, by 
Ferd and Steve Neumann. By 1969 Niemann Foods was a thriving business 
consisting of two components: grocery stores and a wholesale 
distribution operation. But then something tragic happened. Ferd passed 
away unexpectedly. Suddenly the Niemann family was faced with an estate 
tax bill of several hundred thousand dollars. What could they do? Most 
of their assets were not liquid, they were tied up in the day-to-day 
operations and not readily available. The only option available to the 
family was to liquidate part of the business to pay their tax burden. 
As a result the wholesale portion of Niemann Foods was sold off and the 
proceeds given to the IRS, instead of being used to expand the 
business. The Neimann family now spends countless hours and dollars on 
estate planning trying desperately to avoid a repeat of this 
distasteful situation. This is time and money that could and should be 
put into expanding the business and creating more jobs, rather than 
being spent trying to guard against losing the business because of a 
bad tax. The sad and unfortunate reality is that everyone in this 
Chamber probably has a similar story that they can tell. We should 
encourage productivity and growth, not stifle it with unfair burdens. 
This tax is contrary to American ideals and should be repealed.
  I have one problem with this bill, it takes too long to accomplish 
what should be done immediately. If this tax is wrong, it is wrong and 
we shouldn't take 10 years to rectify the situation. We speak of 
fairness, but is it fair for people dying today to have a larger tax 
burden than those who die a year or even ten years from now? I can see 
it now hospitals will be filled with individuals on life support for 
years waiting for this bad tax to be lifted. Let's pull the plug on 
this tax now.
  Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from North 
Dakota (Mr. Pomeroy).
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding me this 
time. I oppose H.R. 8 and strongly support the Rangel substitute. 
Proponents have said this about helping farmers pass the farm from one 
generation to the other. If that is the issue, then pass the Rangel 
substitute.
  The U.S. Department of Agriculture says 99 percent of the farms in 
this country have a net worth below $3 million. The Rangel substitute 
takes a farm couple and allows them to pass a farm worth $4 million of 
net worth. We take care of more than 99 percent of the farms in this 
country under the Rangel substitute.
  Similarly, small businesses, up to $4 million. Another way the 
substitute is better than the majority bill is that it takes effect and 
it takes effect next year. No 10-year wait for the relief they are 
talking about. Next year.
  Another thing about the Rangel substitute, the President will sign 
it. There is a veto threat on their bill. It will never become law. Let 
us provide the relief and make it real, not just issue press releases 
about another House debate. Vote the Rangel substitute for meaningful 
relief for family farmers.
  Mr. Speaker, I rise in opposition to H.R. 8 and in strong support of 
the Rangel substitute. Unlike the underlying bill, the Rangel 
substitute provides immediate estate tax relief for family farmers and 
small businesses, does not drain resources from other urgent 
priorities, and, most importantly, it could be enacted into law this 
year.
  First, the Rangel substitute eliminates estate taxes for more than 99 
percent of family farms not in 10 years, as under H.R. 8, but 
immediately. The Rangel substitute allows family farms an estate tax 
exclusion of $4 million, which exceeds the net worth of more than 99 
percent of family farms according to USDA. For all but a handful of the 
largest farms in the country, the Rangel substitute provides greater 
estate tax relief than the underlying bill.
  Because it is targeted, the Rangel substitute can offer more tax 
relief for farms and small business without draining resources from 
other urgent priorities, including tax cuts for working families. By 
contrast, H.R. 8 would ultimately result in a revenue loss of $50 
billion annually, or $500 billion over the second 10-year period. For 
the cost of repealing the estate tax altogether, Congress could enact 
tax cuts to reduce the cost of child care, open the doors to higher 
education, increase the affordability of long-term care, and still have 
$35 billion left over either to reduce the debt, provide a prescription 
drug benefit, strengthen our national defense or address a similarly 
urgent priority.
  Finally, the Rangel substitute is the only estate tax relief measure 
on the floor today that can actually be enacted this year. The 
administration supports estate tax relief for small business and family 
farms but has stated unequivocally that the President would veto H.R. 
8. As estate tax bill that will never be signed is of no value to the 
farmers I represent.
  For these reasons, I urge my colleagues to support the Rangel 
substitute and to oppose H.R. 8.
  Mr. ARCHER. Mr. Speaker, I yield myself 2\1/2\ minutes.
  Mr. Speaker, let me speak specifically on this substitute. First, at 
the margin, it is better than the current law. That is a great 
breakthrough to see the minority that was proposing increases in the 
death tax before 1995, to have at least come to where they marginally 
want to reduce the impact of the death tax.
  But in many, many ways, it does not tell us up front what is really a 
part of the proposal.

                              {time}  1215

  It is very much like Peanuts where Lucy tells Charlie Brown, ``Come 
kick the football,'' and right before he gets there, she pulls the 
football away.
  And so what they do here is they say we are going to reduce rates; 
and at the same time if you look at page 2, they raise rates, because 
they take away the credit, as the gentlewoman from Washington (Ms. 
Dunn) said, on the State inheritance taxes. So they raise those rates. 
At the same time they deny all of the small businesses, farms, the 
benefit of what they say they are giving them. The gentleman from 
Louisiana (Mr. McCrery) spoke to that. They say only 3 percent of the 
small businesses and farms are taxed today. Let me also say that only 3 
percent of that 3 percent will get any benefit from their proposal. 
That is sad but true as the gentleman from Louisiana said earlier.
  And then they go on, and they increase the market value of minority-
held interests in nonpublicly traded entities. The courts have ruled 
against this over and over again and say the tax should be applied only 
to what is the true market value at the time of death. They create an 
arbitrary market value that has nothing to do with the true market 
value for those minority-held interests in nonpublicly traded entities. 
So they give a little bit on one hand, and they take back big chunks on 
the other hand.
  They also mask the 18 percent lowest marginal tax rate for the death 
tax. No

[[Page H4158]]

one will pay the 18 percent. They will start out at 38 percent. It is 
in the Code. It says the first dollar is 18 percent, but not so. And so 
they give a little, and they take back a lot.
  Vote against the Rangel substitute.
  Mr. RANGEL. Mr. Speaker, I yield myself 2\1/2\ minutes.
  I would like to respond briefly to the chairman of the committee 
because not too long ago a distinguished Member from the other side who 
serves on the committee commented that the Rangel substitute was no 
more than what he and Republicans had suggested several years ago and 
that he thought it was a good idea at the time; but he had no idea that 
President Clinton with a Democratic Congress would be able to have a 
budget to allow us to get the surplus that we are enjoying today, but 
now that he sees the surplus, then he would say, Let's go for the whole 
thing.
  That is the problem that we have today. You people are not interested 
in passing laws to take care of the small farmer and small businesses. 
What you are interested in is politically a veto. If indeed you were 
concerned about helping the small family farmer and the small 
businesses, what you would do is say, well, listen, since we can agree 
with the President, let us get this signed into law, and then maybe if 
God is willing, you will be in the majority and you can take care of 
it.
  You have been in the majority 6 years, and you have not done a darn 
thing except push for vetoes. Veto, veto, veto. Every time we reach 
agreement with you, you kick it up another notch and make it impossible 
for the President to be responsible and deal with this. This will cost 
$104 billion over 10 years, and then we have got to hemorrhage $50 
billion each year. We have been able to take care of the problem that 
you have been crying and bawling about for a long time, and we agree 
that it is an inequity. Why can we not come together where we agree, 
get the President to sign something, and then for God sake get together 
and try to resolve some of the other problems, whether it is the 
marriage penalty, whether it is the Patients' Bill of Rights, whether 
it is the minimum wage.
  You agree with us, but you always kick it up a notch to be 
irresponsible so that the President cannot sign it into law. There is 
still an opportunity. If you vote for the substitute, let the President 
sign it and take credit for it. The only difference between the bills 
that you have had and the bill that we have got is that we have decided 
to be responsible, we decided not to gut the budget, we decided to 
protect Social Security and Medicare and still take care of those 
people who inherit the businesses and the farms from their parents and 
their grandparents who worked hard each and every day to provide and 
leave this for them.
  And so I am suggesting, vote for the substitute and then maybe next 
year we can go further.
  Mr. Speaker, I yield the balance of my time to the gentleman from 
Michigan (Mr. Bonior), the minority whip.
  The SPEAKER pro tempore (Mr. Kolbe). The gentleman from Michigan is 
recognized for 3 minutes.
  Mr. BONIOR. Mr. Speaker, I want to commend my colleague for his 
statement.
  The other day I was talking, and I noticed that the Republican 
leaders had gathered around this coffin outside the Capitol building. 
Like anyone, I wondered, what is going on out there? I later learned 
that they were promoting their estate tax scheme. It was then that I 
realized what I had seen was a funeral. It was the death of 
credibility.
  What else can you call a scheme that costs some $50 billion a year 
but fails to provide added relief for small businesses and family farms 
until the year 2010? You can call it a lot of things, but one thing you 
cannot call it is a credible tax relief package. Oh, sure, some people 
stand to gain from this. If you happen to be one of the richest people 
in the world, this plan could cut your family's taxes by literally tens 
of billions of dollars. But for 98 percent of Americans, this bill will 
not even provide one dollar's worth of relief.
  It will do something, though. Oh, it will do something. It will 
squander $50 billion a year just at a time when we need it the most. 
That means undermining our ability to guarantee the solvency of 
Medicare and Social Security. It means harming our chances of paying 
down the debt. And it will work to prevent us from investing in better 
schools, in child care, in a clean environment, in fighting crime, in 
taking care of our veterans.
  We Democrats have an alternative, a responsible plan that provides an 
estate tax break that we can bank on without breaking the bank. Our 
plan immediately provides a $4 million per-family exclusion for farms 
and small businesses. In fact, it immediately exempts 99 percent of 
family farms from estate taxes. It reduces by almost half the number of 
estates subject to the estate tax.
  So what we have here, Mr. Speaker, is a choice between credible 
estate tax relief or tax cuts for the incredibly rich. If you believe 
in standing up and working for working families, the choice in this 
debate is clear.
  I urge Members to vote no on the Republican scheme and to support the 
Democratic alternative.
  Mr. ARCHER. Mr. Speaker, I yield the balance of my time to the 
gentleman from Illinois (Mr. Hastert), the respected Speaker of the 
House of Representatives.
  Mr. HASTERT. I thank the gentleman for yielding me this time.
  Mr. Speaker, I have a great deal of respect for the minority whip who 
just spoke, but I think he made a mistake when he walked by that 
funeral display. The funeral is the death of and putting away the death 
tax.
  When we talk about credibility, we can talk about a lot of things. 
When I first came here, we had a deficit of a huge number, $450 
billion. We had a debt of $5.5 trillion. We started turning that 
around. Just in the last couple of years, we have said, none of our 
dollars in Social Security are going to go into the general fund. We 
are going to set that aside for Social Security. We are going to do a 
better job of education. We have seen a steady increase in dollars for 
education. We are going to help our young men and women in defense so 
that they do not have to be on food stamps to feed their family. We do 
have a surplus. We are talking about a big surplus in the next couple 
of years. We have two things that we can do: we can pay down the debt 
with that surplus, or we can give some of that money back to the people 
who made it in the first place.
  As of September of this year, we will have paid back $350 billion on 
the public debt. That is a first good step. We have not done it all by 
ourselves. We have done it with help from our friends on the other side 
of the aisle. I do not say it is all partisan one side or the other 
because we have to work on a bipartisan basis. But the other question 
is, what do we do? The gentleman from the other side of the aisle said, 
We're going to take $50 billion. We can't afford it. And where does 
that money come from? The Federal Government reaches in and takes it 
away from people who have paid taxes all their life, that have built a 
small business or a family farm. When they die and they want to pass it 
on to their children and their grandchildren, the Federal Government 
comes in and takes it away, 52 percent to 55 percent of that entity; it 
takes it away.
  Let me tell you a story. When I was a young man, my father-in-law 
died. He was a farmer in southern Illinois. I thought maybe I would 
like to be a farmer. But by the time that we got the death tax taken 
care of and at that time Illinois had a death tax, too, every tractor, 
every combine, every extra roll of fence, every head of cattle was sold 
off so we could pay the State estate tax and the Federal death tax. I 
might have been a good farmer. But I did not have that choice.
  I ran for the legislature in 1980. The gentleman from Illinois (Mr. 
Ewing) and I helped take the death tax off in the State. We helped 
relieve that a little bit. I have always given him a great deal of 
credit for doing that. I was giving a speech not so long ago in 
Wichita, Kansas. It was a small dinner group of probably 50 people. 
Halfway through my speech, there was an older gentleman who stood up 
and said, Wait a minute, young man. He got my attention. He called me 
young man. He was probably 85 years old. He said, I have a small 
business just west of town. I write 96 pay checks a week. Something is 
going to happen to me someday. I want to pass that business on to my 
children and my grandchildren. The

[[Page H4159]]

Federal Government is going to come in and take 52 percent of that 
business. When they do, we are going to have to sell every truck, every 
piece of equipment. I cannot pass that business on as an entire entity 
from generation to generation. There are 96 families in this town that 
will not have a job anymore.
  We talk about big entities, multinational businesses and big 
corporations. Do you know what happens when you have to sell the family 
farm? Do you know what happens when you have to sell that small 
business? You sell it to the big guys, because you get the cash out of 
it and pay the Government. And so when you deprive families from 
passing that entity, that business, that farm, that ranch from one 
generation to the other, you say, we are going to give this to the big 
guys. We are subsidizing the big guys. We are pushing the bigger and 
bigger entities in this country. We are taking away from the families.
  I say this is a vote for the families of this country, of the United 
States of America. Defeat the substitute, vote for the proposal, and 
let us get on with it.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise in opposition to H.R. 
8, the Death Tax Elimination Act of 2000 and strongly support the 
Democratic Alternative.
  I think we are in agreement on both sides of the aisle that the 
estate, gift, and generation-skipping transfer taxes are unduly 
burdensome on all taxpayers and that changes must be made. However, 
H.R. 8 is not in the best interest of our Nation, particularly in terms 
of relief to small businesses and small farms.
  Although, H.R. 8 attempts to alleviate the heavy burden of the estate 
tax, it lacks a feasible solution to alleviate these tax burdens faced 
by many small businesses and small farms. Many small business owners 
and farm owners have told me compelling stories regarding their plight 
and they want to ensure that in the foreseeable future that they will 
be able to pass on their farms and small businesses to their loved 
ones.
  The Democratic Alternative will provide immediate tax relief to these 
same small businesses and farm owners. Specifically, this alternative 
will raise the special exclusion to $4 million for a couple owning a 
farm or small business. For instance, a small business owner in my 
district can pass on their business intact with no estate tax 
whatsoever if it worth up to $4 million.
  In addition, because H.R. 8 is phased in over ten years, a couple 
passing on their farm or small business in the near future would avoid 
more tax under the Democratic plan than under this bill with calls for 
a full repeal. See--More people than ever before are becoming 
millionaires by working hard and investing wisely. By increasing the 
general exclusion (now at $675,000) to $1.1 million next year, the 
Democratic Alternative will allow for any person to pass on their 
wealth to their loved ones without the burden of an estate tax.
  In fact, unlike the Republican's full repeal, nobody has to worry 
about living long enough for the bill to be fully phased in. The 
Democratic $1.1 million exclusion is effective immediately in 2001. 
Also, the Democratic alternative will lower estate tax rates by 20% 
across the board (i.e. the 55% rate would be 44%, the 37% would be 
29.6%). As a result, I fully support this fiscally responsible estate 
tax relief unlike Republican leaders who insist on a full estate tax 
repeal before any plan is in place to save Social Security and 
Medicare, or provide a prescription drug benefit for our Nation's 
seniors, or pay down our national debt.
  ``H.R. 8 will relinquish nearly $50 billion a year in revenue with no 
guarantee that this revenue loss will not harm current plans to save 
Social Security and Medicare in future years. While the official 
estimates show H.R. 8 costing $28.2 billion over 5 years and $104.5 
billion over 10 years, the true cost is cleverly hidden by phasing in 
the repeal so that the real drain on revenue does not show up until 
after the 10-year budget window.''
  By enacting this full repeal, the very richest in our society will be 
able to pass their immense fortunes to their heirs without a penny of 
tax. Hence, our Nation's children will share in our burden of saving 
Social Security and Medicare and paying off our massive national debt. 
Hence, the real winners of this repeal legislation are not small farms 
and small businesses but are very wealthy families with immense assets.
  Finally, President Clinton has already pledged to veto H.R. 8, 
because it provides such an unfair relief to the very richest in our 
society, before saving Social Security and Medicare and paying down the 
debt. The Democratic Alternative would provide fiscally responsible 
estate tax relief that the President would sign. However, Republican 
leaders appear not to care that their repeal bill will not become law! 
See--the real choice is not between the Democratic Alternative and H.R. 
8, but between a negotiated bipartisan compromise or no estate tax 
relief at all for all of America. I choose relief for all America!
  In closing, I again urge my colleagues to oppose H.R. 8, and instead 
adopt the democratic alternative.
  Mr. COYNE. Mr. Speaker, I rise today in opposition to H.R. 8, The 
Estate Tax Elimination Act. This bill would do nothing to help the 
average family businesses. Only 2% of estates are now subject to the 
estate tax. Hard-working Americans should be able to pass their 
businesses on from generation to generation. However, a full repeal of 
the estate tax is not necessary to preserve family businesses.
  The Democratic alternative offers immediate, fiscally responsible 
relief targeted to small business owners and family farmers. It would 
exempt up to $4 million per family in assets from the tax and cut 
estate tax rates by 20 percent. The Democratic alternative would cost 
only 20 billion over the next 10 years.
  H.R. 8 would cost $105 billion over the next ten years. From 2011 to 
2020, the proposal would cost $620 billion. The full costs of this bill 
would come just when the retiring baby boomers will begin to require 
more services. This is money we could use to strengthen Social Security 
and offer a prescription drug benefit for Medicare.
  Full repeal also reduces the progressivity of the tax code. The 
wealthiest Americans would pay tens of billions of dollars less in tax. 
This bill would cause the gap between low-income people and the wealthy 
to grow even faster. I urge my colleagues to support Mr. Rangel's 
fiscally responsible proposal for estate tax relief targeted to 
immediately help small businesses.
  Mr. KLECZKA. Mr. Speaker, I rise today in support of the Democratic 
alternative which does three important things to ease the estate tax 
burden on individuals and family businesses.
  First of all, the substitute would nearly double, effective 
immediately, the estate and gift taxes exemption for individuals to 
$1,100,000, from the current level of $675,000. This means a husband 
and wife can exempt $2.2 million of their assets from estate taxes.
  Secondly, the Democratic proposal significantly raises the estate tax 
exclusion for small businesses. Under current law, there is a $1.3 
million exclusion from the estate tax for interests in farms and 
closely held businesses. The Democratic substitute would effectively 
create a $4 million exclusion per family for farms and closely held 
businesses. It would accomplish this by increasing the limit on the 
small business exclusion from $1.3 to $2 million and by providing that 
the portion of the exclusion not used in the estate of the first spouse 
to die will be allowed to the estate of the other spouse.
  Finally, the substitute would provide a 20 percent across-the-board 
reduction to the estate and gift tax rates.
  I support the Democratic substitute because it provides needed estate 
tax relief to small business and individuals without breaking the bank. 
My Republican colleagues have offered a plan to totally eliminate the 
estate tax, that when fully phased in, will cost $50 billion a year.
  Mr. Speaker, we cannot afford to sacrifice our chance to pay down the 
national debt, ensure the long-term solvency of Social Security, and 
modernize the Medicare program by passing the Republican bill which 
will benefit only 2% of the population--those with the wealthiest 
estates.
  I urge my colleagues to support the Democratic proposal, a common-
sense and affordable way to give Americans estate tax relief and still 
provide funds to meet our responsibility to reduce the national debt so 
this burden will not continue to be placed on the shoulders of our 
children and grandchildren.
  The SPEAKER pro tempore. Pursuant to House Resolution 519, the 
previous question is ordered on the bill and on the amendment offered 
by the gentleman from New York (Mr. Rangel).
  The question is on the amendment in the nature of a substitute 
offered by the gentleman from New York (Mr. Rangel).
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. RANGEL. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  The vote was taken by electronic device, and there were--yeas 196, 
nays 222, not voting 17, as follows:

[[Page H4160]]

                             [Roll No. 252]

                               YEAS--196

     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett (WI)
     Becerra
     Bentsen
     Berman
     Berry
     Bishop
     Blagojevich
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson
     Clayton
     Clement
     Clyburn
     Condit
     Costello
     Coyne
     Cramer
     Crowley
     Cummings
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Edwards
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Frost
     Gejdenson
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hastings (FL)
     Hill (IN)
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Hooley
     Hoyer
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy
     Kildee
     Kilpatrick
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Lantos
     Larson
     Leach
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Luther
     Maloney (CT)
     Maloney (NY)
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McGovern
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Minge
     Mink
     Moakley
     Mollohan
     Moore
     Moran (VA)
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Phelps
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Scott
     Serrano
     Sherman
     Sherwood
     Shows
     Sisisky
     Skelton
     Slaughter
     Snyder
     Spratt
     Stabenow
     Stark
     Stenholm
     Strickland
     Stupak
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Waxman
     Weiner
     Wexler
     Weygand
     Wise
     Woolsey
     Wu
     Wynn

                               NAYS--222

     Abercrombie
     Aderholt
     Archer
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bereuter
     Berkley
     Biggert
     Bilbray
     Bilirakis
     Bliley
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Castle
     Chabot
     Chambliss
     Chenoweth-Hage
     Coble
     Coburn
     Collins
     Combest
     Cook
     Cooksey
     Cox
     Crane
     Cubin
     Davis (VA)
     Deal
     DeLay
     DeMint
     Deutsch
     Diaz-Balart
     Dickey
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ewing
     Fletcher
     Foley
     Forbes
     Fossella
     Fowler
     Franks (NJ)
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Goode
     Goodlatte
     Goodling
     Goss
     Graham
     Granger
     Green (WI)
     Greenwood
     Hansen
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hill (MT)
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Jenkins
     Johnson (CT)
     Johnson, Sam
     Jones (NC)
     Kasich
     Kelly
     King (NY)
     Kingston
     Knollenberg
     Kolbe
     Kuykendall
     LaHood
     Largent
     Latham
     LaTourette
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     McCollum
     McCrery
     McHugh
     McInnis
     McIntosh
     McKeon
     Metcalf
     Mica
     Miller (FL)
     Miller, Gary
     Moran (KS)
     Morella
     Murtha
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Ose
     Oxley
     Packard
     Paul
     Pease
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Quinn
     Radanovich
     Ramstad
     Regula
     Reynolds
     Riley
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Salmon
     Sanford
     Saxton
     Scarborough
     Schaffer
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Shimkus
     Shuster
     Simpson
     Skeen
     Smith (NJ)
     Smith (TX)
     Souder
     Spence
     Stearns
     Stump
     Sununu
     Sweeney
     Talent
     Tancredo
     Tanner
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Toomey
     Traficant
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--17

     Blumenauer
     Clay
     Conyers
     Cunningham
     Danner
     Gillmor
     Gilman
     Istook
     Kind (WI)
     Klink
     Lazio
     Markey
     McDermott
     Smith (MI)
     Smith (WA)
     Vento
     Watt (NC)

                              {time}  1248

  Mrs. BIGGERT and Messrs. WOLF, DICKEY and DUNCAN changed their vote 
from ``yea'' to ``nay.''
  Ms. BROWN of Florida changed her vote from ``nay'' to ``yea.''
  So amendment in the nature of a substitute was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Kolbe). The question is on engrossment 
and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.


               Motion to Recommit Offered by Mr. Doggett

  Mr. DOGGETT. Mr. Speaker, I offer a motion to recommit.
  The SPEAKER pro tempore. Is the gentleman opposed to the bill?
  Mr. DOGGETT. Mr. Speaker, I am.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:
       Mr. Doggett moves to recommit the bill H.R. 8 to the 
     Committee on Ways and Means with instructions to report the 
     same back to the House forthwith with the following 
     amendment:
       At the end of the bill (page 35, after line 5), add the 
     following new title:

TITLE VI--DENIAL OF GIFT TAX EXCLUSION IF POLITICAL ORGANIZATIONS FAIL 
             TO MEET REPORTING AND DISCLOSURE REQUIREMENTS

     SEC. 601. DENIAL OF GIFT TAX EXCLUSION IF POLITICAL 
                   ORGANIZATIONS FAIL TO MEET REPORTING AND 
                   DISCLOSURE REQUIREMENTS.

       (a) Denial of Gift Tax Exclusion.--Paragraph (5) of section 
     2501(a) (relating to transfers to political organizations) is 
     amended to read as follows:
       ``(5) Transfers to political organizations.--Paragraph (1) 
     shall not apply to the transfer of money or other property to 
     a political organization (within the meaning of section 
     527(e)(1)) for the use of such organization only if such 
     organization is in substantial compliance with subsections 
     (d) and (e).''
       (b) Increased Reporting by Political Organizations.--
     Section 2501 is amended by redesignating subsection (d) as 
     subsection (e) and by inserting after subsection (c) the 
     following new subsection:
       ``(d) Returns by Political Organizations.--
       ``(1) Statement of organization.--
       ``(A) In general.--Every political organization shall file 
     a statement of organization with the Secretary (in such form 
     and manner as the Secretary shall prescribe) which contains 
     the information described in subparagraph (B). Such statement 
     shall be filed not later than 10 days after the date that 
     such organization is established (or, in the case of an 
     organization in existence on the date of the enactment of 
     this section, not later than 10 days after such date of 
     enactment).
       ``(B) Statement of organization.--The information described 
     in this subparagraph is--
       ``(i) the name and address of the political organization,
       ``(ii) the name, address, relationship, and type of any 
     person which is directly or indirectly related to or 
     affiliated with such political organization,
       ``(iii) the name, address, and position of the custodian of 
     books and accounts of the political organization,
       ``(iv) the name and address of the treasurer of the 
     political organization, and
       ``(v) a listing of all banks, safety deposit boxes, and 
     other depositories used by the political organization.
       ``(C) Changes in information.--If there is a change in 
     circumstances such that the most recent statement filed under 
     this paragraph is no longer accurate, the political 
     organization shall file a corrected statement with the 
     Secretary (in such manner as the Secretary shall prescribe) 
     not later than 10 days after the date that the statement 
     first ceased to be accurate.
       ``(D) Related and affiliated persons.--For purposes of 
     subparagraph (B)(ii), a person is directly or indirectly 
     related to or affiliated with a political organization if 
     such person, at any time during the 3-year period ending on 
     the date such statement is submitted to the Secretary--
       ``(i) was in a position to exercise substantial direct or 
     indirect influence over the process of collecting or 
     disbursing the exempt purpose funds of such organization, or
       ``(ii) was in a position to exercise substantial, overall 
     direct or indirect influence over the activities of such 
     organization.
       ``(2) Statements of contributions and disbursements.--
       ``(A) In general.--Every political organization shall file 
     a statement with the Secretary (at such time and in such form 
     and manner as the Secretary shall prescribe) which contains 
     the information described in subparagraph (B) with respect to 
     each reporting period.

[[Page H4161]]

       ``(B) Information described.--The information described in 
     this subparagraph is--
       ``(i) the name and address of each person to whom the 
     political organization made any disbursement during the 
     reporting period in an aggregate amount or value in excess of 
     $200 within the calendar year,
       ``(ii) a certification, under penalty of perjury, whether 
     such disbursement is made in cooperation, consultation, or 
     concert, with, or at the request or suggestion of, any 
     candidate for public office or any authorized committee of 
     such candidate or agent of such committee or candidate,
       ``(iii) the name, address, and occupation of each person 
     (and the name of his or her employer) who made (in the 
     aggregate for the reporting period) a contribution in excess 
     of $200 to the political organization,
       ``(iv) the name, address, and business purpose of any 
     entity, as well as whether the entity purports to be exempt 
     from tax under this title and (if so) the provision under 
     which the entity purports to be so exempt, which made (in the 
     aggregate for the reporting period) a contribution in excess 
     of $200 to the political organization, and
       ``(v) the original source and the intended ultimate 
     recipient of all contributions made by a person, either 
     directly or indirectly, on behalf of any particular person, 
     including contributions which are in any way earmarked or 
     otherwise directed through any intermediary.
       ``(C) Reporting periods and due dates for filing 
     statements.--
       ``(i) In general.--The reporting periods and deadlines for 
     filing statements required by this subsection shall be the 
     same as the periods and deadlines set forth for reports under 
     paragraph (4) of section 304(a) of Federal Election Campaign 
     Act of 1971 (2 U.S.C. 434(a)). The Secretary shall issue such 
     guidance as may be necessary concerning the filing deadlines 
     for such statements.
       ``(ii) Certain organizations file annually.--In the case of 
     a political organization described in clause (iii)--
       ``(I) subparagraph (A) shall not apply,
       ``(II) the reporting period shall be such organization's 
     taxable year, and
       ``(III) the due date for the statement required by this 
     subsection shall be the due date (without regard to 
     extensions) for filing the return of tax for such year, 
     whether or not such organization is required to file a return 
     for such taxable year.
       ``(iii) Organization described.--An organization is 
     described in this clause if such organization is a political 
     organization which is organized and operated exclusively for 
     the purpose of securing the nomination, election, or 
     appointment of a clearly identified candidate for State, 
     local, or judicial office.
       ``(D) Electronic filing.--The Secretary shall develop 
     procedures for submission in electronic form of statements 
     required to be filed under this paragraph.
       ``(3) Political organization.--For purposes of this 
     section, the term `political organization' has the meaning 
     given to such term by section 527(e) without regard to 
     whether such organization claims a tax exemption under 
     section 527.
       ``(4) Paperwork and burden reduction.--An organization 
     shall not be required to file any statement under paragraph 
     (1) or (2) for any period if, with respect to such period, 
     such organization submits to the Secretary, under penalty of 
     perjury, a certified statement that the organization has made 
     a filing, which is publicly available, with another Federal 
     agency which includes all of the information requested by 
     paragraph (1) or (2), whichever is applicable, and which 
     specifies the public location where such information may be 
     found.''
       (c) Increased Disclosure by Political Organizations.--
     Section 2501, as amended by subsection (b), is further 
     amended by redesignating subsection (e) as subsection (f) and 
     by inserting after subsection (d) the following new 
     subsection:
       ``(e) Inspection of Statements of Political 
     Organizations.--
       ``(1) In general.--In the case of a political organization 
     (as defined in subsection (d)(3))--
       ``(A) a copy of the statements filed under subsection (d) 
     shall be made available by such organization for inspection 
     during regular business hours by any individual at the 
     principal office of such organization and, if such 
     organization regularly maintains 1 or more regional or 
     district offices having 3 or more employees, at each such 
     regional or district office, and
       ``(B) upon request of an individual made at such principal 
     office or such a regional or district office, a copy of such 
     statements shall be provided to such individual without 
     charge other than a reasonable fee for any reproduction and 
     mailing costs.

     The request described in subparagraph (B) must be made in 
     person or in writing. If such request is made in person, such 
     copy shall be provided immediately and, if made in writing, 
     shall be provided within 30 days.
       ``(2) 3-year limitation on inspection of statements.--
     Paragraph (1) shall apply to any statement filed under 
     subsection (d) only during the 3-year period beginning on the 
     last day prescribed for filing such statement (determined 
     with regard to any extension of time for filing).
       ``(3) Limitaion on providing copies.--A rule similar to the 
     rule of section 6104(d)(4) shall apply for purposes of this 
     subsection.''
       (d) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

  Mr. DOGGETT (during the reading). Mr. Speaker, I ask unanimous 
consent that the motion to recommit be considered as read and printed 
in the Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  The SPEAKER pro tempore. The gentleman from Texas is recognized for 5 
minutes in support of his motion to recommit.
  Mr. DOGGETT. Mr. Speaker, I yield 1 minute to the gentleman from 
Kansas (Mr. Moore), a leader in this political reform effort.
  Mr. MOORE. Mr. Speaker, I urge my colleagues to support the motion to 
recommit. The majority whip said, ``I am for full disclosure and 
immediate disclosure.'' What we say is not nearly as important as how 
we vote.
  This motion only requires organizations engaging in political 
activity to name the contributors, how much was contributed, and how 
the money was spent. Disclosure, simple disclosure.
  The American people are fed up with hypocrisy and delays. What we 
need now is action. Last night, John McCain stood up in the United 
States Senate and stood up for the American people on behalf of 
disclosure. I urge all of my colleagues on this body on both sides of 
the aisle to stand up for disclosure. The American people deserve, 
expect, and demand it.
  Mr. DOGGETT. Mr. Speaker, I yield 30 seconds to the gentleman from 
Texas (Mr. Stenholm), another leader in this effort.
  (Mr. STENHOLM asked and was given permission to revise and extend his 
remarks.)
  Mr. STENHOLM. Mr. Speaker, the issue is pretty simple today. It is 
whether we are going to have sunshine in the political process or 
whether we are not. We all know we do not need another study. We do not 
have to wait on another study. All we need to know is whether or not 
the 527 and all other groups shall disclose how much they are spending, 
how they are spending it, and who is, in fact, contributing the money.
  Let us let sunshine shine on the legislative process. It is pretty 
simple. Vote for the motion to recommit. Let us move this process 
along.
  Mr. DOGGETT. Mr. Speaker, I yield 1 minute to the distinguished 
gentleman from Iowa (Mr. Ganske).
  Mr. GANSKE. Mr. Speaker, yesterday the Senate said that stealth 
political committees have to disclose their donors and expenditures. 
These tax exempt 527s and other like groups could be the Communist 
Chinese, Colombian drug lords, the Mafia. Who knows?
  Both Republicans and Democrats say they want full disclosure. Last 
year, the majority whip said in support of the Doolittle full 
disclosure bill, quote: What reform can restore accountability more 
than an open book? Letters from the gentleman from California (Mr. 
Doolittle) shout, ``Full Disclosure,'' ``Scrap the Failed Rules'' and 
``Full Disclosure.'' Another Dear Colleague screams, ``Hypocrisy.''
  What will the headlines scream tomorrow? Mr. Speaker, 115 Republicans 
voted last year for full disclosure only. If my colleagues are really 
for full disclosure, vote yes. A ``no'' vote is going to be mighty hard 
to explain in November. We can get this done today. Vote yes.
  Mr. DOGGETT. Mr. Speaker, how much time remains?
  The SPEAKER pro tempore. The gentleman has 2\1/2\ minutes remaining.
  Mr. DOGGETT. Mr. Speaker, I yield 30 seconds to the gentleman from 
Massachusetts (Mr. Meehan), the leader of the campaign reform effort 
here.
  Mr. MEEHAN. Mr. Speaker, yesterday the United States Senate took a 
small but important step towards restoring some accountability to our 
elections system. We have a chance today to match that step with one of 
our own.
  We cannot afford to wait. The election season is already upon us. 
There are millions and millions of dollars being raised and the public 
has no idea where it is coming from. We have to stop this corrupt 
system of raising money and having no one know where it comes from. The 
opportunity is now. Now is when we need to change this system.
  Let us match step with the other body and send a message across 
America that whoever contributes to campaigns in America in this cycle, 
the American people are going to know where that money came from.

[[Page H4162]]

  Mr. DOGGETT. Mr. Speaker, I yield myself 1 minute and 30 seconds.
  Mr. Speaker, last night, across this Capitol, 14 Republicans stood up 
to their leadership and took a firm stance against the corruption of 
our American political system. This motion once again seeks to achieve 
what now they have really already accomplished.
  Mandatory full disclosure by every secret political organization is 
the one modest reform that we can put in place in time for this year's 
election. Like yesterday's successful McCain-Feingold amendment, this 
gift tax motion presents each of us with a moment of truth, a choice 
for more secrecy or more democracy.
  Six Republicans joined 202 sponsors of this measure to choose 
openness and reform on my previous motion to recommit in May. We need 
only a few more to make reform a reality.
  This motion, effective immediately, will not delay by 5 minutes the 
estate tax repeal. This motion specifically applies to all 
organizations engaging in political activity. It does not exclude, 
contrary to what my colleagues have been told, or offer any special 
treatment, for labor unions or trial lawyers or any other group allied 
with Democrats. This motion seeks no organization's constitutionally 
protected membership list.
  Mr. Speaker, this motion parallels language that I offered and had 
rejected in the Committee on Ways and Means almost 3 months ago. The 
last-minute offer this morning of a vote by July 4 on a new bill, not 
yet filed, is just another way of running out the clock on reform, 
which each day more dirty money is collected.
  Mr. Speaker, I urge my colleagues, please, do not be hammered into 
submission. Do not be hammered into submission to cast an indefensible 
vote against disclosure. Join us to stop the collection of money so 
dirty that your leadership is ashamed to identify the donors.

                              {time}  1300

  The SPEAKER pro tempore (Mr. Kolbe). The gentleman from Texas (Mr. 
Doggett) has 30 seconds remaining.
  Mr. DOGGETT. Mr. Speaker, I yield the balance of my time to the 
gentleman from Missouri (Mr. Gephardt), the distinguished minority 
leader.
  Mr. GEPHARDT. Mr. Speaker, I am often asked if we can do anything 
here this year in a bipartisan way to solve the obvious problems that 
our country faces. This is an issue on which the Senate has taken a 
definitive position 57 to 42. Senator McCain said yesterday, what could 
be more simple. What could be more fair, honest, and straightforward? I 
cannot say it any better than that.
  This is a moment in which Democrats and Republicans can come together 
to pass an end to the secret organizations with undisclosed money. Vote 
yes for the motion to recommit. Let us get something done for the 
American people in this Congress.
  Mr. HOUGHTON. Mr. Speaker, I rise in opposition to the motion to 
recommit.
  The SPEAKER pro tempore. The gentleman from New York (Mr. Houghton) 
is recognized for 5 minutes.
  Mr. HOUGHTON. Mr. Speaker, I know there is a lot of emotion on this. 
But I would like to speak on the other side of this issue. On May 25 of 
this year, just before we left for the Memorial Day break, the 
gentleman from Texas (Mr. Doggett) offered a 527 amendment to the 
telephone tax repeal. I understand what he was getting at. We are all 
trying to accomplish the same thing. But it was a curious proposal. It 
would repeal the telephone tax for everyone except for political 
organizations that do not comply with the new disclosure requirements.
  So the end result would be, at the end of the day, if section 527 
organizations were willing to pay a 3 percent phone tax, they could 
avoid disclosure. I do not think that was in the spirit of what we were 
trying to do.
  Today the gentleman from Texas (Mr. Doggett) is proposing still 
something else. Though we are trying to repeal the estate and gift tax, 
we keep it on the books for section 527 organizations.
  These proposals bother me. They only attack part of the problem. 
Also, before we left for Memorial Day, I indicated that I was working 
with a group of people to try to get together a hearing, and we have 
been in session only 3 days since that time. We are going to have the 
hearing. It is going to be set for the 20th of this month.
  An article in yesterday's Wall Street Journal noted that, under the 
proposal offered by the gentleman from Texas (Mr. Doggett), that many 
tax exempt organizations would be shielded from disclosure laws, not 
full light on all the organizations that are contributing. Why is it 
fair to the American people, therefore, to require some tax exempt to 
disclose political activities and not all? Why is it right for one 
party or another to benefit from bringing some groups into the sunshine 
while allowing others to operate under the cloak of secrecy.
  We are taking a looking at lobbying and campaign intervention by all 
of these groups, regardless of their agenda, not just the 527 groups. 
What we would like is disclosure by these groups, but we have to be 
careful because we do not want to regulate constitutional rights to 
death so that the rights become meaningless.
  Yesterday I announced we were going to be having a hearing in 
Committee on Ways and Means on the 20th of this month. There are some 
that say that we do not need a hearing and just do it. But by doing it, 
we can do it the wrong way.
  If the majority were to bring this to the floor without a hearing, I 
think this would be wrong. My colleague and I serve on the key 
committee of the House. The committee has a strong tradition of trying 
to do things the right way. We try not to enact legislation piecemeal, 
imposing disclosure requirements on some tax exempt organizations but 
shielding others for not disclosing them.
  Senator McCain said yesterday that he was interested in broadening 
this. It was a first step. He wanted to broaden this. This is, of 
course, what we are trying to do.
  Now, in a political year, there are all sorts of pressures from the 
press and from parties and things like that. But I would like to think 
that most of us want to reject this.
  I am a very strong advocate of campaign finance reform. I signed a 
discharge petition on this House floor. I voted for the Shays-Meehan 
bill. But I do think that there is another way of doing this and doing 
it right.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from Texas (Mr. Armey), the majority leader of the House.
  Mr. ARMEY. Mr. Speaker, I want to thank the gentleman from New York 
for yielding me this time.
  Mr. Speaker, what we are discussing here is an important issue. It is 
recognized as such by the American people. It is an issue that requires 
a much more dignified response by this Congress than what it is getting 
on this floor today.
  This is not about political vendettas or partisan politics. It is 
about the key principle of full and fair disclosure for, as the 
gentleman from Texas (Mr. Stenholm) said so eloquently, all 
institutions that engage in political advocacy. There are many people 
on this side of the aisle that have taken that position for a long 
time.
  Within the next week, we will have hearings on a measure that will 
require full and fair disclosure for all institutions that engage in 
political advocacy. There will be a vote on this floor on a bill prior 
to the July 4th district work period where we will require full and 
fair disclosure for all institutions that engage from political 
advocacy without political exemption and without political vendetta.
  The SPEAKER pro tempore. All time has expired.
  Without objection, the previous question is ordered on the motion to 
recommit.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.


                             Recorded Vote

  Mr. DOGGETT. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. The Chair will advise Members that a vote on 
passage, if ordered, will be reduced to a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 202, 
noes 216, not voting 17, as follows:

[[Page H4163]]

                             [Roll No. 253]

                               AYES--202

     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett (WI)
     Becerra
     Bentsen
     Berkley
     Berman
     Berry
     Bishop
     Blagojevich
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Campbell
     Capps
     Capuano
     Cardin
     Carson
     Clayton
     Clement
     Clyburn
     Condit
     Costello
     Coyne
     Cramer
     Crowley
     Cummings
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Edwards
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Forbes
     Ford
     Frank (MA)
     Franks (NJ)
     Frost
     Ganske
     Gejdenson
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Gutierrez
     Hall (OH)
     Hastings (FL)
     Hill (IN)
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Hooley
     Hoyer
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy
     Kildee
     Kilpatrick
     King (NY)
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Lantos
     Larson
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Luther
     Maloney (CT)
     Maloney (NY)
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McGovern
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Minge
     Mink
     Moakley
     Mollohan
     Moore
     Moran (VA)
     Morella
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Phelps
     Pickett
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Scott
     Serrano
     Shays
     Sherman
     Shows
     Sisisky
     Skelton
     Slaughter
     Snyder
     Spratt
     Stabenow
     Stark
     Stenholm
     Strickland
     Stupak
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Waxman
     Weiner
     Wexler
     Weygand
     Wise
     Woolsey
     Wu
     Wynn

                               NOES--216

     Abercrombie
     Aderholt
     Archer
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bereuter
     Biggert
     Bilbray
     Bilirakis
     Bliley
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Canady
     Cannon
     Castle
     Chabot
     Chambliss
     Chenoweth-Hage
     Coble
     Coburn
     Collins
     Combest
     Cook
     Cooksey
     Cox
     Crane
     Cubin
     Davis (VA)
     Deal
     DeLay
     DeMint
     Diaz-Balart
     Dickey
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ewing
     Fletcher
     Foley
     Fossella
     Fowler
     Frelinghuysen
     Gallegly
     Gekas
     Gibbons
     Gilchrest
     Goode
     Goodlatte
     Goodling
     Goss
     Graham
     Granger
     Green (WI)
     Greenwood
     Gutknecht
     Hall (TX)
     Hansen
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hill (MT)
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Jenkins
     Johnson (CT)
     Johnson, Sam
     Jones (NC)
     Kasich
     Kelly
     Kingston
     Knollenberg
     Kolbe
     Kuykendall
     LaHood
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     Martinez
     McCollum
     McCrery
     McHugh
     McInnis
     McIntosh
     McKeon
     Metcalf
     Mica
     Miller (FL)
     Miller, Gary
     Moran (KS)
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Ose
     Oxley
     Packard
     Paul
     Pease
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Quinn
     Radanovich
     Ramstad
     Regula
     Reynolds
     Riley
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Salmon
     Sanford
     Saxton
     Scarborough
     Schaffer
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Sherwood
     Shimkus
     Shuster
     Simpson
     Skeen
     Smith (NJ)
     Smith (TX)
     Souder
     Spence
     Stearns
     Stump
     Sununu
     Sweeney
     Talent
     Tancredo
     Tanner
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Toomey
     Traficant
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--17

     Blumenauer
     Clay
     Conyers
     Cunningham
     Danner
     Gillmor
     Gilman
     Istook
     Kind (WI)
     Klink
     Lazio
     Markey
     McDermott
     Smith (MI)
     Smith (WA)
     Vento
     Watt (NC)

                              {time}  1323

  So the motion to recommit was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Kolbe). The question is on the passage 
of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. ARCHER. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. This is a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 279, 
noes 136, not voting 20, as follows:

                             [Roll No. 254]

                               AYES--279

     Abercrombie
     Aderholt
     Andrews
     Archer
     Armey
     Baca
     Bachus
     Baird
     Baker
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bereuter
     Berkley
     Berry
     Biggert
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blunt
     Boehlert
     Bonilla
     Bono
     Boswell
     Boucher
     Boyd
     Brady (TX)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Castle
     Chabot
     Chambliss
     Chenoweth-Hage
     Clayton
     Clement
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cook
     Cooksey
     Costello
     Cox
     Cramer
     Crane
     Cubin
     Davis (VA)
     Deal
     Delahunt
     DeLay
     DeMint
     Deutsch
     Diaz-Balart
     Dickey
     Dooley
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Eshoo
     Etheridge
     Everett
     Ewing
     Farr
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Fowler
     Franks (NJ)
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green (WI)
     Greenwood
     Gutknecht
     Hall (TX)
     Hansen
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hill (MT)
     Hilleary
     Hobson
     Hoekstra
     Holt
     Hooley
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inslee
     Isakson
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson, Sam
     Jones (NC)
     Kasich
     Kelly
     King (NY)
     Kingston
     Knollenberg
     Kolbe
     Kuykendall
     LaHood
     Lampson
     Lantos
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lofgren
     Lucas (KY)
     Lucas (OK)
     Maloney (CT)
     Manzullo
     Martinez
     McCarthy (NY)
     McCollum
     McCrery
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     McNulty
     Metcalf
     Mica
     Miller (FL)
     Miller, Gary
     Mink
     Mollohan
     Moore
     Moran (KS)
     Moran (VA)
     Morella
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Ose
     Oxley
     Pascrell
     Paul
     Pease
     Peterson (MN)
     Peterson (PA)
     Petri
     Phelps
     Pickering
     Pitts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Quinn
     Radanovich
     Rahall
     Ramstad
     Regula
     Reynolds
     Riley
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Salmon
     Sanchez
     Sandlin
     Sanford
     Saxton
     Scarborough
     Schaffer
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shows
     Shuster
     Simpson
     Sisisky
     Skeen
     Skelton
     Smith (NJ)
     Smith (TX)
     Souder
     Spence
     Stearns
     Stump
     Sununu
     Sweeney
     Talent
     Tancredo
     Tanner
     Tauscher
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thompson (CA)
     Thornberry
     Thune
     Tiahrt
     Toomey
     Traficant
     Udall (CO)
     Upton
     Velazquez
     Vitter
     Walden
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Wicker
     Wilson
     Wise
     Wolf
     Wynn
     Young (AK)
     Young (FL)

                               NOES--136

     Ackerman
     Allen
     Baldacci
     Baldwin
     Barrett (WI)
     Becerra
     Bentsen
     Berman
     Bonior
     Borski
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capuano
     Cardin
     Carson
     Clyburn
     Coyne
     Crowley
     Cummings
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     DeLauro
     Dicks
     Dingell
     Dixon
     Doggett
     Doyle
     Edwards
     Engel
     Evans
     Fattah
     Filner
     Frank (MA)
     Frost
     Gejdenson
     Gephardt
     Gonzalez
     Green (TX)
     Gutierrez
     Hall (OH)
     Hastings (FL)
     Hill (IN)
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Hoyer
     Jackson (IL)
     Jackson-Lee (TX)
     Johnson, E. B.
     Jones (OH)
     Kanjorski

[[Page H4164]]


     Kaptur
     Kennedy
     Kildee
     Kilpatrick
     Kleczka
     Kucinich
     LaFalce
     Larson
     Lee
     Levin
     Lewis (GA)
     Lowey
     Luther
     Maloney (NY)
     Mascara
     Matsui
     McCarthy (MO)
     McGovern
     McKinney
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Minge
     Moakley
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pastor
     Payne
     Pelosi
     Pickett
     Pomeroy
     Price (NC)
     Rangel
     Reyes
     Rivers
     Rodriguez
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Sawyer
     Schakowsky
     Scott
     Serrano
     Sherman
     Slaughter
     Snyder
     Spratt
     Stabenow
     Stark
     Stenholm
     Strickland
     Stupak
     Taylor (MS)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (NM)
     Visclosky
     Waters
     Waxman
     Weiner
     Wexler
     Weygand
     Woolsey
     Wu

                             NOT VOTING--20

     Blumenauer
     Boehner
     Clay
     Conyers
     Cunningham
     Danner
     Gillmor
     Gilman
     Istook
     Kind (WI)
     Klink
     Lazio
     Markey
     McDermott
     Packard
     Smith (MI)
     Smith (WA)
     Vento
     Watt (NC)
     Whitfield

                              {time}  1332

  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Mr. ISTOOK. Mr. Speaker, on rollcall No. 254, I was unable to attend 
and vote due to a family medical emergency. Had I been present, I would 
have voted ``aye.''
  Mr. PACKARD. Mr. Speaker, I was meeting with the clerk and staff of 
my subcommittee in preparation for our markup on my appropriations 
subcommittee and unavoidably missed the last vote apparently. I feel 
badly having missed such a crucial vote. Had I been present, I would 
have voted ``yes'' on final passage.

                          ____________________