[Congressional Record Volume 147, Number 74 (Friday, May 25, 2001)]
[House]
[Pages H2832-H2844]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CONFERENCE REPORT ON H.R. 1836, ECONOMIC GROWTH AND TAX RELIEF
RECONCILIATION ACT OF 2001
Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 153, I call up
the conference report on the bill (H.R. 1836) to provide for
reconciliation pursuant to section 104 of the concurrent resolution on
the budget for fiscal year 2002.
The SPEAKER pro tempore. Pursuant to House Resolution 153, the
conference report is considered as having been read.
(For conference report, see prior proceedings of the House of today.)
The SPEAKER pro tempore. The gentleman from California (Mr. Thomas)
and the gentleman from New York (Mr. Rangel) each will control 30
minutes.
The Chair recognizes the gentleman from California (Mr. Thomas).
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
Well, the day has arrived. There was a contest for President last
year. There were very clear and particular themes underscoring the
candidacies of each of the gentlemen running for President. One of them
said he wanted to bring a different atmosphere to Washington and he
wanted to return some of the taxpayers' money. Governor George W. Bush
became President. There is a different climate in Washington, and this
morning we are returning some of the taxpayers' money. The conference
agreement on H.R. 1836 is clear evidence of that different environment.
I want to thank the Speaker of the House of Representatives, the
gentleman from Illinois (Mr. Hastert). Without his ability to focus,
guide, support and nurture, this conference report would not be before
us. I want to thank the majority leader, the gentleman from Texas (Mr.
Armey), for his willingness to stand shoulder to shoulder in trying to
produce a responsible product. But probably more important than that, I
want to thank the chairman of the Senate Committee on Finance, the
gentleman from Iowa, Mr. Grassley, and the ranking minority member of
the Senate Committee on Finance, the gentleman from Montana, Mr.
Baucus, because they decided that the only way legislation as
significant and sweeping as this could pass the Senate would be if from
the beginning it was a bipartisan effort.
It does not take too much analysis to realize that if you have a
Committee on Finance divided evenly between 10 Republicans and 10
Democrats, you are not going to be able to move anything unless it is
bipartisan.
{time} 0830
But they were committed to returning the taxpayers' money enough that
they built a bipartisan product from its instigation in the Senate,
carried it through the floor and into conference. And along with the
gentleman from Louisiana (Mr. Breaux), we put together a bipartisan
product coming out of the conference.
Now, I know there is some consternation because not every member of
the conference signed the conference report. What is important to note
is there was a bipartisan signature structure because the underlying
legislation is bipartisan in itself.
There have been a number of statements about this piece of
legislation which I do think need to be addressed. There are
individuals who are still using a statistical analysis of a fictitious
piece of legislation in terms of the distributional effects on the
taxpayers based upon the tax changes.
I would urge my colleagues in a number of places on the floor to pick
up the material entitled Distributional Effects of the Conference
Agreement for H.R. 1836 prepared by the bipartisan Joint Committee on
Taxation to give you some feeling of the way this bill has been
constructed. Notwithstanding the rhetoric you are going to hear once
again about how this goes only to the wealthy, if you will simply look
at the change in Federal taxes and the percent of the benefit going to
particular income groups, for example: in those income categories
between $10,000 and $20,000, in this calendar year, 11.5 percent of the
benefits go to the $10,000 to $20,000; $20,000 to $30,000 9.4 percent;
$30,000 to $40,000, 6.4 percent; $40,000 to $50,000, 5.4 percent;
$50,000 to $75,000, 4.5 percent; $75,000 to $100,000, 3.5 percent;
$100,000 to $200,000, 2.6 percent; $200,000 and over, 1.3 percent. In
other words, those who have the lowest income get the greatest benefit.
In other words, if your income category is $10,000 to $20,000 a year,
you get 11.5 percent of the benefit. If it is $200,000 and over, you
get 1.3 percent. In fact, it is a numerical cascading structure in
which every increment moves in the direction you would expect if it is
a fair distributional structure.
In addition to that, I have heard statements about the fact that this
particular package will destroy Medicare, that once again Social
Security is under threat. I wonder how long the bumper sticker
political rhetoric is going to be continued. The Senate Budget
Committee, the House Budget Committee, those responsible for examining
the budgetary structure, say in every year of this agreement, the HI or
the Medicare Trust Fund is fully protected and the Social Security
Trust Fund is fully protected. This agreement meets the requirement of
the budget that we passed to protect Social Security and Medicare in
every year of the 10 years of the agreement.
Now, let me address the 10 years because that clearly was one of the
most popular themes during the rule. I am sure there will be a number
of speakers to take the well to say, hey, this agreement is phony
because it only lasts 10 years.
This legislation was considered under the budget reconciliation rules
that apply to the Senate. Under budget reconciliation, it is possible
to pass legislation limiting the rules of the Senate
[[Page H2833]]
in terms of debate and hours to debate a subject normally unlimited and
only require 51 votes to do so. It was created because it was almost
impossible to move legislation just like this through the Senate
without the limitations that are currently available in the
reconciliation structure. It is a two-edged sword. It means you are
able to get through the Senate legislation like this, but under the
rules of the Senate it can only be for 10 years and that if any revenue
bill extends its effect outside the 10-year window, it is, as we say,
subject to a point of order and, therefore, the entire package fails.
I will tell my colleagues that if you want permanent tax change, it
requires 60 votes in the Senate to accomplish that. I have before me
what a 60-vote bill would look like. It is, if you notice, a blank
piece of paper, because that is what the tax bill would be if it were
to be permanent. You would not have $1.35 trillion of tax relief for
hardworking American taxpayers. You would not have a lump sum payment
in lieu of withholding adjustment of almost $40 billion going out to
Americans to help stimulate the economy this year. You would not have
permanent rate reduction. You would not have the refundability for
child credit that is in this bill. You would not have anything.
So I appreciate the wringing of the hands and the concern that this
only lasts 10 years. I tell my colleagues, every one of you who are
worried about this only lasting 10 years, join with me, let us walk
across the Capitol, and you produce 60 votes. If you produce 60 votes,
you will have it permanent. If you do not, it is as simple as that.
Unfortunately, under the rules in which the Senate must operate to have
a clear majority express its will, it can only be done within the 10-
year framework.
So we will hear the argument that all of this is only for 10 years.
But if it is only for 10 years, what a 10 years it will be. More than
$1.3 trillion in a time of surplus will be returned to the hardworking
taxpayers. I know some of you are concerned that it is not going to be
available to continue to feed the Federal dog. The problem, of course,
we know is that when you start one of your programs, it is a cute
little puppy but as you continue to feed it with hardworking taxpayers'
dollars, it grows into an enormous, large dog that eats almost all the
resources. We have seen it over and over again. That is why we were in
deficit year after year after year. What we have, courtesy of the
gentleman from Iowa (Mr. Nussle), is a budget under which we are
required to work with, yes, provides this kind of taxpayer relief but
also provides a responsible, over-the-cost-of-living growth structure
for the Federal Government.
I know you are used to unrestrained growth. A little discipline is
not necessarily a bad thing. Frankly, a little relief for the American
taxpayer is not necessarily a bad thing, either.
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
I have been here for 3 decades, and I have never heard such poppycock
in my life.
What we are talking about, the 10-year end of this bill, is because
the Senate made me do it? It is true that we have violated every
constitutional principle we could think of in terms of writing law and
raising revenue but, my God, is the new Republican thing is ``it wasn't
me, the Senate made me do it''?
We are supposed to create revenue here. We are the ones that are
supposed to write the tax bills. But what did we send over to the other
side? Nothing. And so now we are sorry because they have shoved this
piece of legislation down our throats.
Bipartisanship. Let me tell you, Mr. Speaker, when you appointed me
to serve on the conference committee along with our distinguished
majority leader and the distinguished chairman of the Committee on Ways
and Means, I was so proud because I would have been the only Democrat
in the House of Representatives, where the people govern, to at least
try to guide this away from just the rich and maybe reflect the
concerns of the moderate and the hardworking people of America. So as
soon as I was appointed, I waited and I waited and I waited for an
invitation to the meeting. But the invitation never came.
Now, I do not know where the bipartisanship is unless one of the
Republicans is a closet Democrat, but I can tell you this, I went
looking for the meeting. The White House was at the meeting, Republican
Members of the House were at the meeting, Republicans from the Senate
were at the meeting. But guess what? Not one Democrat from the House
was at the meeting.
Now, the chairman of the committee waves a piece of paper saying,
this is what the bill would look like if the Senate had not made them
accept it. Well, do not wave empty paper. Where is the bill, I ask the
gentleman from California? Why is it that Members of this House have no
copy of this bill that explodes in 10 years? Show us the bill if you
are so proud of it. Or should we beam it up on the Web net as we have
been advised and that is the only way we are going to find out what is
going on?
I tell you this: If you were proud of this document, it would not
have been patched up in the middle of the night. We would not be here
on Saturday morning. We would not have meetings in the darkness of the
night where people do not know where they are, but we would have been
walking forward, Democrats and Republicans, proud of what we were
doing. Instead of that, we have no bill, we have a lot of sarcasm, and
yet we are expected now to go home and be proud.
Mr. Speaker, I reserve the balance of my time. Better than that, I
yield 2 minutes to the distinguished gentleman from Missouri (Mr.
Gephardt), the leader of the Democratic Party. Maybe he can find the
bipartisanship, but for 3 days I have searched for it and it was not to
be found in this Capitol.
(Mr. GEPHARDT asked and was given permission to revise and extend his
remarks.)
Mr. GEPHARDT. Mr. Speaker, on my way in here this morning in the
dawn's early light, I was thinking of proper titles for this bill. I am
sure it has some classy title that has been given it by its sponsors.
How about the ``Special Interest Relief Act''? How about the
``Deficit Re-Creation Act''? How about the ``Plunder Medicare and
Social Security Act''?
Mr. Speaker, I ask Members to vote against this bill. It has been a
long night, a long night of a conference to put together the biggest
tax bill in the history of our country. And as the gentleman from New
York just said, it was done in a cloud of secrecy. Democratic Members
of the House were not allowed in the meetings where this bill, the
largest tax bill in our history, was put together. And so what we have
today is a giant relief act for special interests in this country, not
for the people of this country. And we are not acting on the most
important crisis that faces our country today which are runaway, back-
breaking electricity prices on the West Coast of the United States.
The President said he came as a uniter, not a divider. He said that
he would collaborate with Democrats and that the parties would work
together.
{time} 0845
Yet from day one on this bill, it has been my way or the highway
every day.
I dare say there was more collaboration in this conference between
Republican Members and special interests than between Republicans and
Democrats to find the right bill.
In fact, the chairman of the committee had this to say in this
morning's Washington Post: He said the decision to scale back numerous
provisions rather than jettison a few reflected a political
calculation. He said a number of groups in the Senate pushed for
individual provisions so negotiators sought, and I quote, ``to fit in
as many of those special interest groups as possible.''
Look at what had to be done to shoehorn in as many of those special
interests as possible. We moved, in effect, the sunset date back a
year. Why was it not moved back five more years? Why was every special
interest in the country not shoehorned into this bill?
We wind up with becoming the laughing stock of the country because
one has to die before 2010 in order to get the full benefit of the
estate tax.
Someone said in the morning paper, this is going to be a Saturday
Night Live routine, and it is. Can one imagine the routines that can be
done?
[[Page H2834]]
Now let me give three quick reasons why this bill should be defeated:
first, we believe that this tax cut comes over 20 years to over $5
trillion, over $5 trillion. It is backloaded. It is backloaded. It is
backloaded. It explodes in the final years. It will cause the largest
deficits this country has ever seen, and precisely at the time when the
baby boomers are going to be coming into the Medicare system and the
Social Security Trust Fund. We are going to be raiding those funds of
needed dollars to take care of future generations.
Secondly, it is weighted to the top. The top 1 percent get 36 percent
of the benefits of this bill.
We have no argument with people who have made a lot of money. We
bless them. Thank God people can make a lot of money in this country
and all of our citizens feel they can make a lot of money. We bear no
grudge. We welcome their ability to do this, but we make a choice when
we give that much of the tax cut to the people at the top. It means we
do not give enough to the people in the middle class and the people
trying to get in the middle class.
This is the opportunity society. We want people to feel they can get
wealthy. We want people to work hard. But how will they take a tax bill
that gives everything at the top?
Finally, it is fiscally irresponsible. We have worked so hard, we
have worked so hard in this country, to get us back to a time of
surpluses and not deficits. And tonight, today, this morning, we take a
U-turn. We turn away from the most important achievement of this
country and this economy.
I began to think that citizens had lost all faith in us because we
could not deal with the deficit, and finally we summoned the courage in
the early 1990s to take care of the deficit. We made the hard
decisions, and I would argue that the Members of this Democratic Party
sacrificed their seats so that we could return to fiscal
responsibility.
It is what Senator Jeffords talked about in such ringing terms 2 days
ago, and now we turn our back on this most important achievement.
Again, if we were doing this risky scheme to give a larger tax cut to
the middle class, maybe one could justify it. But, no, that is not what
we are doing. We are doing this for special interests. We are doing
this so the largest, wealthiest special interests in this country can
get all of their things shoehorned into this bill.
Let me just say this this morning, or yesterday morning, and even in
some places this morning, children are going to school in trailers in
this country because we have not built the school buildings to house
them. Our forests and our public lands need protecting. Our seniors,
especially on the West Coast, need low-income energy assistance. People
want more cops on the beat so that we feel safe on our streets, and
middle-income families who are paying $2.25 a gallon for gasoline would
like to have the majority of this tax cut.
Incidentally, Mr. Speaker, this is a tax bill, probably the last tax
bill. The President sent us an energy plan last week. It has all kinds
of tax incentives to produce alternative energy in this country. There
is not one red cent in this bill to advance the energy interests of
this country. This is not what we ought to be doing this morning.
Twenty years from now people will look back on this morning as a
momentous, defining moment in the economic history of this country and
the social history of this country. I urge Members on both sides of the
aisle to examine the facts and examine their conscience. This bill, in
my opinion, is an outrage. It is an outrage to the common sense and
decency of the American people, and I ask each of the Members to
consider carefully their vote because I believe with all my heart it
will be remembered for their entire career and will be remembered by
them for the rest of their lives.
Please do the right thing and reflect the values of the great
American people: decency, honesty, fiscal responsibility, and common
sense. Vote no on this tax bill.
Mr. THOMAS. Mr. Speaker, I yield myself 30 seconds.
Mr. Speaker, I want to thank the minority leader for providing us
with a defining statement. I think it can be made no clearer in terms
of the difference here on the floor today. The gentleman from Missouri
(Mr. Gephardt) said, mark my words, this is the last tax bill. He said
this is the last tax bill.
He must know something we do not. Obviously, he is consulting with
the new majority leader of the Senate, Tom Daschle from South Dakota;
and apparently the new majority leader has assured him this will be the
last tax bill.
If one wants to know the difference, the defining statement between
the two sides, we think there ought to be more tax relief bills.
Clearly the statement indicates there will not be any more. He knows
more than we do about the way the Democrats are going to run the other
body.
Mr. Speaker, it is my pleasure to yield 4 minutes to the gentleman
from Iowa (Mr. Nussle), chairman of the Committee on the Budget and a
member of the Committee on Ways and Means, someone who created the
structure which allowed us to provide this kind of legislation to come
to the floor.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore (Mr. LaHood). The Chair would remind all
Members that personal references to the Senators are not allowed under
the Rules of the House.
Mr. NUSSLE. Mr. Speaker, I thank the gentleman from California (Mr.
Thomas) for yielding me this time.
Mr. Speaker, I congratulate the gentleman and all of those that have
worked on this bill. It fits within the budget. It is a good product,
and it is not an outrage. The minority leader said it is an outrage. If
it is such an outrage, why will the majority party today be joined by
as many as 40 Democrats who support this bill? If it is such an
outrage, why will it be that at least 10 Democrats in the Senate will
join with the majority party in support of this bill? If it is such an
outrage, why is it that this is supported by the American people in
great numbers across our country? Because they know, as we know, who
should be spending the money in this country.
This bill, I think, is a stark contrast between excuses and
opportunities. What we just heard from the minority leader is a number
of excuses, excuses that we have heard for a number of years as to why
we cannot have a tax cut.
I have heard so many times people say tax cutting is easy; I am for
tax cuts; coming to the floor and cutting taxes is one of the easiest
things we can do. Then why is it since World War II that we have only
done it twice before? If it is so easy, why is it that this is only the
third time that we have been able to have this kind of tax relief for
the American people since the end of World War II? It is because it is
not easy. It is difficult.
Why is it difficult? Because there are so many excuses for why people
cannot have their resources back and why the government should be
spending that money itself.
What are some of those excuses that we have been hearing? The number
one excuse was we cannot provide tax relief to the American people
because it dips into Social Security. For one of the first times we
have a budget that says we are not touching any of Social Security.
This tax bill fits within that budget. We do not touch Social Security.
We will not touch Social Security. That was a bipartisan decision. I
hope that that holds, and it fits within this budget.
The second is that we should not do it because it touches Medicare.
The minority leader said that this bill touches Medicare. That could
not be farther from the truth. It does not touch Medicare. It should
not touch Medicare. It will not touch Medicare. That also was a
bipartisan agreement, and we should continue that practice here today.
The third excuse was we should pay down the national debt first. In
fact, this budget accomplishes the largest reduction of the debt held
by the public in our history. This bill does not change that in one
way, shape or form; and by the end of the 10 years of this budget we
will have eliminated the debt held by the public, except for that which
is needed for the cash flow.
We have heard this is for the rich, and the minority leader
mistakenly said 36 percent of the relief goes to the top 1 percent.
Could not be farther from the truth; could not be farther from the
truth. Read the distribution
[[Page H2835]]
tables. Of course, that is a little hard to do, but, in fact, that is
not the case.
We have heard it is the wrong time, the wrong way. It is the wrong
process. We have heard it is too dark at night. We have heard every
excuse in the book, except for the one that really matters, and that is
the opportunity that this gives to the American people itself.
The real issue here today is who should spend the money. Do we
believe that individuals and families make the best decisions about how
to spend their money, or do we believe government is in the best
position to do so? The special interests that we heard from the
minority leader are in this bill. Want to hear what they are? People
who are married, people who have children, people who are worried about
the education of those kids, people who are worried about their small
business and farms, and people who are worried about more and more
money that goes to Washington that is not available to pay for higher
energy bills, higher college costs and higher expenses.
Vote for this bill. It fits within the budget.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
California (Mr. Stark), a distinguished member of the Committee on Ways
and Means.
(Mr. STARK asked and was given permission to revise and extend his
remarks.)
Mr. STARK. Mr. Speaker, I thank the gentleman from New York (Mr.
Rangel), the distinguished ranking member, for yielding me this time.
Mr. Speaker, this bill is an obscene hoax on the American people, and
it is not about taxes. It is about the Republican plan to fundamentally
cripple the ability of government to do its job. It is about
sacrificing our Nation's priorities on the altar of tax breaks to the
wealthiest among us.
The Republican leaders would like nothing more than to hamstring our
Federal Government's ability to function. They know it and we know it.
They praise the President's leadership, and on that note I will join
them. The President's leadership led to one of the most outstanding
acts in the political scene of this year and perhaps this century when
the gentleman from Vermont decided to switch parties. In his statement
he said ``that in the past, without the Presidency the various wings of
the Republican Party and Congress have had some freedom to argue and
influence and ultimately to shape the party's agenda. The election of
President Bush changed that dramatically.
{time} 0900
We do not live in a parliamentary system, but it is only natural to
expect that people like myself, who have been honored with positions of
leadership, will largely support the President's agenda and yet, more
and more I find I cannot. Those who do not know me may have thought I
took pleasure in resisting the President's budget or that I enjoyed the
limelight. Nothing could be further from the truth. I had serious
substantive reservations about that budget, as you all know, and the
decision it set in place for the future.
Looking ahead, I could see more and more instances where I will
disagree with the President on very fundamental issues. The issue of
choice. The direction of the judiciary, tax and spending decisions,
missile defense, energy and the environment, and a host of other
issues, large and small. Now, for some, success seems to be measured by
the number of students moved out of public schools. In order to best
represent my State, I will leave the Republican Party and become an
independent. I hope my colleagues on the other side of the aisle will
follow the President's leadership and take that good advice.''
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore (Mr. LaHood). Again, the Chair will remind
all Members that personal references to Senators are not in order,
except to identify them as sponsors of legislation.
Mr. THOMAS. Mr. Speaker, I yield such time as he may consume to the
gentleman from Missouri (Mr. Hulshof).
(Mr. HULSHOF asked and was given permission to revise and extend his
remarks.)
Mr. HULSHOF. Mr. Speaker, I rise in support of this very likely last
tax relief measure in this Congress.
Mr. THOMAS. Mr. Speaker, it is my privilege to yield 2 minutes to the
gentleman from Ohio (Mr. Portman) who, on a bipartisan basis, was
responsible for a major portion of this bill, the pension and IRA area.
Mr. PORTMAN. Mr. Speaker, I thank the gentleman for yielding me this
time. I want to congratulate the Chairman and his colleagues for
excellent work on this tax relief measure. I know I am not supposed to
talk about Democrat Senators, but I will talk about them in terms of
sponsors.
Senator Max Baucus, who did sponsor the legislation on the Senate
side, and Senator John Breaux, who is one of the sponsors on the Senate
side, worked very hard with Senator Chuck Grassley, chairman of the
Finance Committee, and the gentleman from California (Mr. Thomas),
chairman of the Committee on Ways and Means; and they did a fantastic
job in putting together a great bill.
A couple of points need to be made. One is that this is about 25
percent of the tax surplus that is permitted to go back to the
hardworking American people that sent, after all, every dime of that
surplus to Washington. That is certainly fair and not consistent with
what we have heard on the other side.
In terms of special interests, let us talk about the special
interests here. First, all of the President's major proposals are here,
the ``big four.'' Across-the-board tax relief that benefits every
single American, while those at the lower- and middle-income levels get
a disproportionate amount of the tax relief under this provision. An
increase in the child tax credit, allowing all American families to
have a little more to be able to raise their kids and the expenses
incurred by that. It is also refundable, so it helps folks that do not
pay any Federal income taxes, some who pay payroll taxes, some who pay
no payroll taxes or Federal income taxes. Marriage penalty relief. All
of us know about that, we have been fighting for that for years.
Finally, in this legislation, we get relief to folks who are married
so they are not paying more just for the benefit of being married.
Death tax repeal; very important to small businesses around this
country, and those four are all in this legislation. All finally, after
so many years of talking about them, so much discussion here on the
House floor, we will have enacted into law to help the American people,
not special interests, but the people who work hard every day to make
this country work.
Other things are also added. The adoption tax credit to let people
adopt children more readily. Education tax credit to help with tuition,
to help with student loans; and, finally, the retirement security
provisions which are extremely important to let every American save
more for their own retirement. Raising the IRA contribution from $2,000
to $5,000. Had it been indexed to inflation originally, it would be a
little over $5,000 a day. We are doing a catch-up there where it should
be. On the 401(k) side, helping people to save more, again, for their
own retirement.
This is a good bill. That is why 68 percent of the American people,
55 percent Democrats, support it.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from
California (Mr. Matsui), a distinguished member of the Committee on
Ways and Means.
Mr. MATSUI. Mr. Speaker, I thank the gentleman from New York for
yielding me this time. I might just express my disappointment to the
gentleman from New York (Mr. Rangel), because over the last few days I
had given him a number of provisions that I thought other Members of
this body, Democratic Members particularly, would find helpful in terms
of this tax bill, so perhaps we could have voted for it. But, then I
found, after the gentleman had received all of these tax proposals that
I had, that well, he was not allowed to go into the conference or
allowed to go into the meetings. So I am sorry that I burdened the
gentleman with that information, because it is pretty obvious that the
gentleman was shut out. So I just want to make this effort to thank him
for his effort.
Mr. RANGEL. Mr. Speaker, will the gentleman yield?
[[Page H2836]]
Mr. MATSUI. I yield to the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I would like the gentleman from California
to know, when I found out that I was excluded from the meeting, I did
seek to see whether or not another member of the Democratic leadership
perhaps had been invited; but as I said to the gentleman early this
morning, the gentleman should know, not one Democrat in this House of
Representatives got the chance to participate in this bill.
Mr. MATSUI. Mr. Speaker, I thank the gentleman. I think the good news
is the fact that the Senate will change in another week. This will be
the last extreme bill that we will have before the body that will be
sent to the President.
I would like to point out a few things. One, the document that showed
that we have a $5.6 trillion surplus over the next 10 years, that same
document said that there was only a 50 percent chance of accuracy that
these 5-year numbers are correct and they have no basis to make an
accuracy projection on the 10-year numbers. This could have been $8.9
trillion or $1.6 trillion or perhaps 0. So we are basing this $5.6
trillion surplus on speculation, and that is exactly what this bill is
all about.
Now, let me just make a couple of observations. The chairman of the
committee says that this will not affect Social Security, because in
the 10-year window, it will not have any impact on Social Security. The
reason for that is because in the year 2014, 13 years from now, is when
Social Security has the cash flow problem. So basically, yes, for the
next 10 years, it may not have an impact on Social Security, but it
will have a devastating impact on Social Security in terms of its long-
term survivability.
I will say that a ``yes'' vote on this bill, will mean that senior
citizens will, in fact, have significant reductions in their benefits.
There is no question about it. The chairman of the Committee on the
Budget made an interesting observation. He said that this bill really
does not go to the wealthy. The problem is that he is using a 5-year
projection. Of course, in the 5-year projections, it is not until the
6th to the 10th year that the tax benefits for the wealthy actually
phase in. As a result of that, those people that earn $1.1 million a
year on their tax returns will get 38 percent of these benefits. That
is not good budget policy.
Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 1 minute to the
gentleman from Florida (Mr. Young), the chairman of the Committee on
Appropriations, who certainly, over the course of the rest of this
session of Congress, is going to have something to say about whether or
not this tax bill will encroach on Social Security or Medicare.
Mr. YOUNG of Florida. Mr. Speaker, I appreciate the gentleman
yielding me this time.
I just wanted to say this, that I am not going to report an
appropriations bill that spends one penny from the Social Security or
Medicare funds.
Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 1 minute to the
gentleman from Florida (Mr. Shaw), a member of the Committee on Ways
and Means who is the chairman of the Subcommittee on Social Security.
Mr. SHAW. Mr. Speaker, I would like to congratulate the gentleman
from California (Mr. Thomas) and all of those responsible for bringing
this conference report to us.
It absolutely is appalling how we continue to hear, particularly from
the other side, that every time we are going to give tax relief that is
going to stop us from doing all of these other things and that it is
going to in some way impact upon the Social Security Trust Fund.
Believe me, this tax bill does not spend one nickel of the Social
Security Trust Fund.
The surpluses are going to be out there until 2016. Instead of
throwing rocks at what we are trying to do, giving Americans some tax
relief, I would invite my Democrat friends to join with me in solving
the problem of Social Security, because beginning in 2016, there is
going to be some problems, because the surplus is going to go away in
2016. By using just one-third of that surplus right now, we could solve
the Social Security problem for all times.
So let us quit using this as a political hammer, and let us recognize
that we need to legislate for the next generation and not the next
election.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Maryland (Mr. Cardin a distinguished member of the Committee on Ways
and Means.
Mr. CARDIN. Mr. Speaker, I thank the gentleman for yielding me this
time.
Let me start off by complimenting the conferees on the retirement and
pension provisions that are in this conference report. As the chairman
mentioned frequently, that bill had been worked in a very bipartisan
way, and I think in conference that spirit was continued, and I am very
pleased with the provisions that are included in the conference report
as it relates to the pension and retirement provisions.
However, Mr. Speaker, I regret that I will be forced to vote against
a bill that I worked very hard on because of the other provisions that
are included in here. The pension retirement provisions are less than 4
percent of the revenue costs of the bill; but the other provisions
explode in costs, and I have spoken on this floor several times about
this legislation. It does make it much more difficult for us to pay
down our debt.
As the chairman of the Committee on Appropriations said, I did not
know we were appropriating the Social Security benefits. Maybe the
Committee on Appropriations is trying to take the jurisdiction away
from the Committee on Ways and Means on the Social Security system. But
this bill if, in fact, we are off by 1 percent on the growth rate of
our Nation, we will find that we have appropriated all of the surplus
during the next 10 years for this tax cut. I would hope that during the
next 10 years, we will have priorities in addition to tax cuts, that we
could deal with education, that we could deal with prescription
medicines.
What I am concerned about is that we are putting into effect today
tax relief that will jeopardize our ability to provide these other
priorities for the American public. This is a reckless bill, and I urge
my colleagues to vote against it.
Mr. THOMAS. Mr. Speaker, I ask unanimous consent that the gentleman
from Florida (Mr. Shaw) control the remainder of time on our side.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
There was no objection.
Mr. SHAW. Mr. Speaker, I yield 2 minutes to the gentleman from
Arizona (Mr. Hayworth), a distinguished member of the Committee on Ways
and Means.
(Mr. HAYWORTH asked and was given permission to revise and extend his
remarks.)
Mr. HAYWORTH. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, this morning we are hearing again a very interesting
debate. The gentleman from Maryland (Mr. Cardin), who worked in a
bipartisan way for meaningful pension reform and relief, now abandons
the larger measure. The gentleman from California (Mr. Matsui) speaks
of speculation. Mr. Speaker, it is interesting that when I was in the
private sector and I watched Washington spend more and more and more
and more of the people's money, including Social Security funds, it was
interesting how those forecasts and estimations never seemed to make a
difference in the minds of the previous majority.
I heard the gentleman from California (Mr. Stark), reduced to reading
a statement from someone in the other body that had nothing to do with
the tax relief today; and I heard the gentleman from Missouri (Mr.
Gephardt), the minority leader, speak of a Saturday Night Live sketch.
Perhaps he was thinking about the fictional character of Tommy Finnagan
as portrayed by Jon Lovitz years ago who was somewhat factually
challenged, because indeed the presentation from the left has been
completely factually challenged this morning.
Mr. Speaker, I invite my colleagues to join us to offer meaningful
relief in the marriage penalty, to finally put the death tax to death,
for marginal rate reductions, and for the American people getting some
of their hard-earned money back immediately. Rather than have the
incendiary comments, let us work together.
[[Page H2837]]
Mr. Speaker, I believe today on this floor, despite the wailing and
gnashing of teeth, despite the extreme rhetoric of the other side, we
will have meaningful tax relief for the American people; and it is
about time. Wouldst that my friends would join us again; but they are
already saying today, just one, no more. How sad that is. But at least
on this one, I say to my colleagues, let us join together for
commonsense tax relief, because the money belongs to the people, not to
the Washington bureaucrats.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from New
York (Mr. McNulty), a member of the Committee on Ways and Means.
Mr. McNULTY. Mr. Speaker, I do not want to go back to the days of
deficit spending. There are a lot of numbers flying around Washington,
D.C. these days, and I know a lot of people do not know who to believe.
So I am not going to use any of the numbers of the gentleman from New
York (Mr. Rangel) or any of the numbers of the gentleman from Missouri
(Mr. Gephardt) or any of the Daschle numbers; I am going to use the
President's numbers.
{time} 0915
He stood in this Chamber not long ago and he projected we would have
over the next 10 years a $5.6 trillion surplus. Some people think that
is a guess, some people think it is a gamble, some think it is a dream.
But sometimes dreams come true. Let us assume it happens.
He wants to pay down $2 trillion on the national debt. As a fiscally
conservative Democrat, I want to do that. I like that. That takes us
down to $3.6 trillion.
Then he says, as we all have said, ``We are not going to touch the
Medicare or Social Security trust fund monies.'' Now, 400 of us voted
to do that. The chairman of the Committee on Appropriations just said
we are not going to do that. We subtract that out and we are down to
$700 billion.
Now what do we do? We are going to have a tax cut in the amount of
$1.35 trillion. I rounded that down to $1.3 trillion, and we have a
$600 billion deficit. Using the President's numbers, with no new
program funding, nothing for education, nothing for military pay,
nothing further as far as spending is concerned, we have a $600 billion
deficit, using the President's numbers.
Mr. Speaker, here is the deal. We have a $5.7 trillion national debt.
Last year, we paid $329 billion in interest on the national debt. Let
us not go back to the days of deficit spending. For the sake of our
children and grandchildren, defeat this irresponsible proposal.
Mr. SHAW. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Connecticut (Mrs. Johnson), a distinguished member of the Committee on
Ways and Means.
Mrs. JOHNSON of Connecticut. Mr. Speaker, I stand in strong support
of this legislation, and hope Members will help our constituents to see
how much help it is going to give to young families getting started in
life. It not only drops the taxation on part of their income to 10
percent, but it also gives them two 15 percent brackets before they
move up into the higher bracket, so they will be able to earn much more
income, give their family a much better start before they begin to
carry the kind of burden they carried today. Not only will they get the
double 15 percent bracket, the advantage of the 10 percent bracket, but
they will have the double child tax credit over time, $1,000 per child.
We are going to keep young families out of those mid ranges of our
Tax Code for most of the years of their raising their young children.
This is an enormous change in the sort of launching of children and
families in our society. I am very proud that we are making it
possible.
Let me say lastly that I am sort of astounded at what I hear from the
other side. It is absolutely as legitimate to, in a sense, spend the
surplus through the tax vehicle as through the spending vehicle.
I know many of them want to increase spending in this area and that
area. Because we spend $80 billion a year through the Tax Code, America
has a primarily employer-provided health care system. All that, the
private sector health plans that employers provide to their employees,
is made possible because we exempt those premiums through the Tax Code.
We spend over $80 billion every year through the Tax Code. I want
another tax bill that provides that same tax equity and tax support to
everyone who pays their own health insurance premiums. That is every
bit as intelligent and effective a way to expand access to health
insurance as a subsidy program from Washington, which I know many of
them support.
Mr. Speaker, I thank the chairman for the tax bill. It is going to
make a big difference in people's lives.
Mr. RANGEL. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
Missouri (Mr. Skelton).
Mr. SKELTON. Mr. Speaker, much has been said about this bill
jeopardizing Social Security, Medicare, prescription drugs, but
somebody needs to speak for the American soldier.
I am on the Committee on Armed Services. I take this work very, very
seriously. This bill jeopardizes dollars for defense, as so aptly
pointed out by the gentleman from South Carolina (Mr. Spratt) just a
few weeks ago.
Later on this year, during either the appropriation process or an
amended budget process, I will take this floor, Mr. Speaker, and I will
do my best to get additional dollars for the American soldier, because
the roofs are leaking on the family housing, the spare parts bins are
empty, training is being curtailed.
As a matter of fact, in Missouri there are more non-flyable
helicopters because of lack of spare parts than those that fly. I think
this jeopardizes the national security. We must look at that.
Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 1\1/2\ minutes to
the gentleman from Georgia (Mr. Kingston).
Mr. KINGSTON. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, several months ago I was at Johnson High School talking
to the seniors, and a little girl named Julie Long sat in the front. I
asked her if she had a job, how much she got paid. She had a job, she
made $7 an hour.
I said, ``Julie, if you work for 2 hours, you take home $14.'' She
said, ``No, Mr. Kingston, of course not, I pay taxes, about $4 worth.''
Okay, so on the $14 that she has earned, she was paying $4 in taxes.
Now, she understands we need to pay for the military, we need to pay
for education, roads and bridges and functions of government. She said,
``Yes, sir.'' I said, ``Julie, what if you found out that I could do
all that for $3.50, not $4. What would you want me to do with the other
50 cents?'' She said, ``It is my money, Mr. Kingston. Give it back to
me.''
That is what this bill is all about. All it says is that we are going
to take care of Social Security, Medicare, normal functions of
government, especially education; come on, I say to the gentlemen, it
is the President's education package. Then we are going to pay down the
debt. With what is left, we are going to return it to the American
taxpayers.
It is not time for class warfare, to bring out the same arguments we
heard on health care reform, Medicare reform, regulatory reform. It is
not time for all the fearmongering. Let us just say who this money
belongs to, which is the taxpayer, not us in Washington, and let us say
it is their money and we are going to return it to them.
That is what this bill is all about. I urge my colleagues to support
the conference report.
Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from
Wisconsin (Mr. Kleczka).
Mr. KLECZKA. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, the chairman of the committee, the gentleman from
California (Mr. Thomas), a while ago said when this President ran for
office, he said there was going to be a change in the environment in
Washington, D.C. Over the last few months we have seen that. In fact,
most recently we have found that the fundraising in this town has moved
from the Lincoln bedroom in the White House to the Cheney bedroom. So
already we are seeing this big change that was talked about.
What I would like to do this morning is just make some observations
on the bill. We are being told by our Republican colleagues that we
must give the money back. Taxpayers have been
[[Page H2838]]
overcharged. Well, let us analyze those two statements.
Number one, we have to give the money back, but the problem is, the
money is not here. The money is not here. It is a projected surplus
over the next 10 years. We hope and pray it is going to be here, but it
is not today. So I say, Mr. Speaker, we cannot give the money back if
we do not have the money.
But this bill does expend all that money, and know full well, if
there is a downturn in the economy worse than today, the first thing to
go is cutbacks in programs, and not going back on these tax cuts. This
will be sacrosanct, we are not going to be able to touch it.
As far as overcharging the taxpayers, the taxes that have been coming
in over the years have for the most part been going to pay down the
annual debt. The gentleman from New York (Mr. McNulty) indicated what
the interest charge was per year, so taxpayers were not being
overcharged. They were being charged for the excesses that started with
the tax cut of the Reagan administration.
Let me say a couple words about this new thing that is added to the
bill. That is the fact that we are going to send checks back. Maybe the
chairman of the Committee knows how much that would cost, but to send a
check to taxpayers in a month or so is going to cost millions and
millions of dollars. Those same millions of dollars could be going for
more teachers and more police on the beat.
I just want to tell a little story about sending checks back. It
comes from an experience in the State of Wisconsin. Then Tommy
Thompson, the Governor, signed legislation a little over a year ago to
send the checks back to Wisconsinites because of a projected surplus.
So we all got about $320 back, very close to what we are going to get
today.
Mr. Speaker, Tommy Thompson got out of town. He left the State, and
that State that sent the checks back today is faced with a $760 million
deficit. So I want to thank all for the checks from the Wisconsinites.
It is going to go to increased gas and to pay back that $320 to the
State.
Mr. Speaker, the Tax Conference Report before us today is the result
of the surplus dollars projected to be available over the next ten
years. The White House and Republican authors of this bill looked at
the Congressional Budget Office report, which predicted that $2.7
trillion would be available over the next ten years, and like a kids in
a candy store, their eyes got big like saucers. Unfortunately, my
Republican colleagues got so excited about the CBO's guesstimate that
they forgot to finish reading the report. CBO was so unsure of its
surplus estimate that they felt the need to devote an entire chapter to
explaining the uncertainty of their projection. If my Republican
colleagues had taken the time to review the entire budget document,
they would have read that ``a downturn in the economy, depending on its
severity and duration, could greatly diminish or even eliminate
surpluses over the next few years.''
This tax bill is a gamble. Locking in a tax cut of the proportion
will gamble our ability to provide for a sound fiscal future. Looking
at the nation's long-term fiscal health, beyond 2011, reveals massive
deficits as we try to deal with the costs of providing for our
children's education, defense needs, prescription drug benefits, and
the solvency and soundness of the Social Security trust fund. The
Comptroller General tells us that deficits will occur ten years from
now even if we don't pass this $1.35 trillion tax cut!
The Conference Report before us is filled with back-loaded tax cuts.
It is a ticking time bomb that is set to explode at precisely the same
time that the baby boomers begin to retire. It is in the second 10
years that the true cost of this tax bill will be known--precisely the
same time that the bulk of baby boomers are retiring. According to the
Center on Budget and Policy Priorities, the cost of the bill in the
second ten years is $4.1 trillion. To accomplish this, the bill delays
marriage penalty relief for 5 years and waits until 2011 to repeal the
estate tax--hiding the true cost outside of the 10-year budget window.
By the authors' own admission, this bill is a floor not a ceiling for
additional tax cuts. Other bills the Republican Leadership has
indicated will likely be considered include a business tax package to
accompany the minimum wage, tax extenders, adjustment in the
Alternative Minimum Tax, and various tax incentives for health care and
education. In addition, the Conference Report does not take into
account the hundreds of billions in interest costs that will have to be
paid because passage of this bill will jeopardize our ability to pay
down the debt. When the debt and all of the remaining tax bills are
added together, the total cost is nearly $3 trillion! That's more than
the $2.7 trillion in projected surpluses that are available outside the
Social Security and Medicare Trust Funds. Inevitably, the Republican
tax bills will collapse under their own weight.
The tax plan is deja vu. Twenty years ago, Congress passed a large
tax cut that quickly tripled the deficit and quadrupled the national
debt. Apparently, my friends on the other side of the aisle seem to
have selective recall when it comes to that part of our history.
Mr. Speaker, the Tax Reconciliation Conference Report before us today
is an irresponsible tax proposal that will be paid out of the pockets
of our children. I urge its rejection.
Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 30 seconds to the
gentleman from Iowa (Mr. Ganske).
Mr. GANSKE. Mr. Speaker, this is not complicated, it is simple.
People are either for tax relief, or they are not.
This bill provides tax relief for families with children, for married
couples, for farmers, for small businesspeople. Mr. Speaker, when the
year 2011 comes around, we will sure want a Senate that reaffirms tax
relief, not one that increases taxes, like in 1993. Vote for this bill.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Georgia (Mr. Lewis), an outstanding American and a member of the
Committee on Ways and Means.
Mr. LEWIS of Georgia. Mr. Speaker, I thank the gentleman for yielding
time to me.
Mr. Speaker, the Republican tax bill is not the way to go. It is
going to take the country down the wrong road. What if we are wrong?
The Republican tax bill is based on a 10-year forecast that we know
probably will not happen. In fact, the people who made the forecast
have said that it is not going to come true. According to them, there
is only a 10 percent chance that their forecast will be correct.
We cannot afford to be wrong on this one. We are locking ourselves
into a 10-year plan when we are not even sure that the money would be
there.
The gentleman from New York (Mr. Rangel), does he know what this
would be like? It would be like counting the chickens before the eggs
hatch. That would not be fair for the American people. What if we are
wrong? What if the surplus does not happen?
The administration, the Republicans, somebody is not telling the
whole truth. They are not telling us the whole story. They need to be
honest with the American people, honest about the true costs of the tax
bill, honest about what will happen if the surplus does not
materialize, honest about what will happen to Social Security, honest
about Medicare and other priorities.
We have an obligation, a mission, and a mandate to tell the truth,
the whole truth, and nothing but the truth. The Republicans are playing
with the numbers. It is deceptive, it is a sham, and it is a shame. We
should be paying down the debt, saving Social Security and Medicare,
taking care of the basic needs of all of our people.
The Republican bill is not right for America. It is not fair and it
is not just. We should vote down this bill. We should do it for the
American people. We have an obligation to vote it down.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the distinguished
gentleman from Mississippi (Mr. Taylor).
Mr. TAYLOR of Mississippi. Mr. Speaker, in the tradition of the
gentleman from Iowa (Mr. Nussle), I should have worn a paper bag down
here today.
How can anyone look the American people in the eye and say we have a
surplus when we owe the Social Security trust fund $1 trillion? There
is no account. There is no money. They have nothing but IOUs. But
somebody else is going to get a tax break today.
We owe the Medicare trust fund at this moment $228 billion. There is
no lockbox. There is no bank account. They have an IOU.
We owe our Nation's military retirees, the people who they are all
going to go give speeches to next Monday and tell them how much we
value them, we owe them $163 billion. There is no account. There is no
bank account. They took the money and they are going to give it to
somebody else.
We owe our Nation's civil servants $501 billion.
{time} 0930
Now, how can anyone look me in the eye and say we have a surplus when
we
[[Page H2839]]
owe those folks that money? My colleagues have taken money out of their
paychecks with the promise that my colleagues were going to set it
aside for their retirement.
It is not there. This is wrong for America. We have a unique
opportunity to start paying down the debt; and, instead, my colleagues
are giving their big contributors a tax break. Shame on you.
Mr. RANGEL. Mr. Speaker, my colleagues have no response?
The SPEAKER pro tempore (Mr. LaHood). The gentleman from New York
(Mr. Rangel) has 6 minutes remaining and the gentleman from California
(Mr. Thomas) has a couple of speakers.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Texas (Mr. Stenholm), an outspoken Member on our
government's budget.
(Mr. STENHOLM asked and was given permission to revise and extend his
remarks.)
Mr. STENHOLM. Mr. Speaker, I want to choose my words very carefully
today, because tomorrow I may eat them, just as I have heard many
statements made on this floor today that I think are going to be eaten.
When you govern this country based on political promises and polls
rather than sound economics and good policy, the market will correct
us.
Let me remind everyone to start looking at what is happening to long-
term interest rates as we have been debating this tax cut. They have
gone up 4 percent, which means a tax increase on all soon-to-be
homeowners.
Now, this budget bets the ranch that the surpluses that everybody
talks about are going to be there. If they are not, we are going to
have a difficult time governing in this body in a bipartisan way.
Social Security has been mentioned, and my number one disappointment
in this budget is the fact that there is no money left for us to do the
kind of bipartisan Social Security reform that I wanted to work with my
President for. My colleagues have spent it all. Then my colleagues come
in and sunset in 2011.
Mr. Speaker, I wanted to do something for estate taxes. I wanted to
have an immediate $4 million exemption for small businesses owners all
over the country effective now. This one does not survive the laugh
test. It does not even deserve the laugh test.
We heard defense mentioned a moment ago. I know that the die is cast.
I was here in 1981. I have heard a little revisionist history on the
floor this morning.
The facts, as the gentleman from Mississippi (Mr. Taylor) spoke of,
were the result of the 1981 vote; and we are in danger of repeating it.
I hope I am wrong. I hope I will be able to eat the crow you will
dish out to me in a year from now, if I am wrong. But if I am right,
get your knives and forks out.
Mr. THOMAS. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas (Mr. Armey), the majority leader, and a colleague and a companion
on the conference committee that produced this document.
Mr. ARMEY. Mr. Speaker, as a young professor, I remember the despair
that my profession of economics had in the 1970s dealing with the
malaise of that decade, the stagflation, the hopelessness, and the
helplessness of the economy that caused the American people to turn to
Ronald Reagan when we just did not seem to be able to get the economy
to move.
Ronald Reagan, God bless his heart, broke the back of inflation, and
by cutting taxes and reducing government regulation on the economy, he
got this economy into 2 decades now of growth that have never been
paralleled in the history of the economy.
But here is the fact, here is the fact: because Ronald Reagan cut
taxes, enabled the economy to grow, the fact is the American people
doubled the amount of money they sent to Washington in the decade of
the 1980s. That is a fact. It happened. Because we had better jobs, we
had a growing economy, we spent more money.
What did Washington do? Washington spent $1.56 for every increased
dollar we sent to Washington, not Ronald Reagan. This Congress spent
that money year after year after year. Not only did they spend all of
that, but they spent every surplus dime of payroll taxes that decent
men and women in this country paid expecting it to go to mom and dad's
Social Security.
The Democrat Congresses wasted those Social Security surpluses year
after year after year on every risky spending scheme they could trump
up. That went on until 1993. And in 1993, the President of the United
States raised taxes and the deficits went on and the spending went on
until 1995.
Since 1995, the American people have continued to do their job and
continued to send increased amounts of money to Washington, but
something changed with that new Republican majority.
Since 1995, for every dollar we have sent to Washington, government
spending has gone up by less than 50 cents. That is where the surplus
comes from. We restrain this lust for spending other people's money,
and the surplus is there.
We were able under these circumstances to stop the 40-year raid on
Social Security. We did that. It was a simple little ethical thing. We
just looked at our children; and we said, why do we not honor them
while they honor their parents when they pay those payroll taxes and
let us stop this business of wasting it on every new, risky spending
scheme somebody could concoct?
Here we are today, a great day for the American people, a day where,
thanks to George Bush, for the first time in 2 decades, we are talking
about across-the-board reduction in taxes for every American that pays
taxes. That is a remarkable thing to be celebrating in this country.
And what do we hear over here? Oh, do not do that. Do not do that. We
have new spending schemes, new risky spending schemes. You will deny us
the money for our new risky spending schemes.
Well, the party is over. The party has moved. The party is no longer
in Washington. The addicts are going to have to take the cure. We are
no longer going to get stoned on other people's money and our new
spending programs. No.
We are going to move the party to America where people will spend
their own money on things that are healthy, beneficial, and, in fact,
assure a brighter future for their own children because of one simple
thing, because they love their children best.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, let me take this time to thank the gentleman from Texas
(Mr. Armey), the distinguished majority leader, for taking my place in
the tax conference. Had I been there, I would have been able to have a
different view, but I thank the gentleman so much.
Mr. Speaker, I yield 2 minutes to the gentleman from Maryland (Mr.
Hoyer).
Mr. HOYER. Mr. Speaker, I was here in 1981. The gentleman from Texas
(Mr. Armey) was not. He was then an economist, perhaps not so
successfully because he came to Congress.
Ronald Reagan asked the Congress of the United States to spend every
nickel of Social Security surplus in his budgets. George Bush first
asked the Congress of the United States to spend every nickel of Social
Security and Medicare surplus.
The Congress of the United States from 1981 to 1993 spent less money
than Ronald Reagan and George Bush asked us to spend. Those are the
facts, my friends. Those are the facts.
Very frankly, my colleagues knew the facts in 1981. I mentioned them
a little earlier today. Let me recite them again so that my colleagues
understand the premise that was underlying 1981. He was not a liberal.
He was not a Democrat. His name was Stockman. He knew what you were
doing in 1981, notwithstanding the same kind of rhetoric that we heard
on this floor today.
He said that we knew that the budget we were passing would result in
triple digit debts, deficits. We knew that we would escalate the debt.
We knew that interest rates would remain high and at historically high
levels in 1980.
You light a time bomb today that will blow up for generations yet to
come. It is your duty, your responsibility to defeat this bill. Do so.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the distinguished
gentlewoman from California (Ms. Solis).
Ms. SOLIS. Mr. Speaker, as a freshman here in the House, I waited to
see where we could work together on a bipartisan effort so that we
could provide the much-needed relief that Californians are crying out
for.
[[Page H2840]]
When I go home today and I meet those folks that I represent, the
people who are not going to get one iota of a tax break on relief, the
people in my district currently are probably the hardest working folks,
senior citizens, that have paid their way, that have given us the
riches that we have in this country.
They are waiting. They are waiting to see what action is going to
take place here. The folks in my district want to keep the lights on in
California. They get no help from this budget on the energy crisis.
There is an energy crisis.
There are children who are crying because they want to know that they
are going to be able to have school rooms that are not going to fall
down on them because they are going to be built to secure their
education and their livelihood there. That is not in this budget.
What about the promises we made to seniors for Medicare and Medicaid
reform to help them? What about those people in my district that have
been gouged by those energy producers from Texas?
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from
California (Ms. Pelosi).
Ms. PELOSI. Mr. Speaker, the Republicans are attempting to justify
their tax bill by saying this tax break for their wealthy friends is
needed to offset a slowdown in the economy.
My Republican colleagues, in case you have not noticed, the biggest
threat to the economy is the energy crisis which will be felt
throughout the country. There is a solution, and these solutions are
the wave of the future, renewable energy and energy efficiency.
Yet this tax cut necessitates a cut by 50 percent in research and
renewable energy and 30 percent in energy efficiency. Instead of
passing this reckless tax bill, and, yes, instead of letting this House
lie silent for two whole days, we should have taken up an energy bill.
We should have passed the Inslee bill to help the entire West.
Do not let the Republicans tank the economy with their reckless tax
vote. Vote no. Vote responsibly. Vote no on this bill.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from New
York (Mr. Hinchey), my friend.
Mr. HINCHEY. Mr. Speaker, I listened very carefully to the gentleman
from Texas (Mr. Armey), the distinguished majority leader, just a few
moments ago, and I was reminded about the capacity of the human mind to
deceive itself.
Ronald Reagan never sent a balanced budget up to this Congress, not
once in all the 8 years that he was there. This bill is a mistake
today. Anyone can make a mistake and any group of people can make a
mistake, but it takes a certain level of foolishness to make the same
mistake over again.
In 1981, we passed a tax bill under the direct urging of a new
Republican President. The result of that bill was deep recession and
huge deficits, $5 trillion of deficits today as a result of that tax
cut.
{time} 0945
Now we are being asked to do the same thing over again. If we do it,
we know what is going to happen; and our Republican colleagues intend
it to happen. There will be no money to deal with crumbling schools.
There will be no money to deal with prescription drugs. There will be
no money to deal with the problem of 13 million children living in
poverty. All of those things our Republican colleagues do not want to
address. That is why they want this tax cut passed. Let us defeat this
bill.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Washington, Mr. Inslee.
Mr. INSLEE. My Speaker, my Republican colleagues' fiscal plan is a
little like a money-laundering machine because every dollar they give
to the American taxpayer, the taxpayers are going to give $2 to the
energy companies, and the Republicans will not do a single thing about
it.
While energy prices go up a thousand percent, they do nothing. Last
night, I was reading Tom Brokaw's book about the greatest generation.
He quoted Roosevelt saying, ``This generation has a rendezvous with
destiny.'' Well, under this plan, the baby boom generation has a
rendezvous with a fiscal disaster when we start to retire. The
Republicans have put us on the horns of this dilemma. When the baby
boomers start to retire 10 years from now, when the Republicans sunset
the repeal of the estate tax, which gives a whole new meaning to estate
planning, the Sopranos may have a job under the Republicans' plan in
the year 2010. If this goes through, Saturday, March 26th, 2001, will
be a day of fiscal infamy.
Defeat this bill. Join us in a fair plan where the baby boom
generation will stand up for fiscal responsibility.
Mr. RANGEL. Mr. Speaker, it is my understanding that my colleague on
the other side of the aisle will be yielding the remainder of his time
to our distinguished Speaker to close.
Mr. THOMAS. Mr. Speaker, I advise the gentleman that the Speaker will
close, but he has honored me with just a statement at the end which
would take 10 seconds, so it is a closing on this side.
Mr. RANGEL. Mr. Speaker, I yield myself the balance of my time, and I
want to sincerely thank the Speaker for thinking enough of the
Democrats and the Committee on Ways and Means in appointing me to the
conference. I only wish that he had told the majority leader and the
chairman of the committee that he had done that. Because somehow this
conference turned from a Ways and Means conference to a Republican
conference; Republicans from the White House, from the House, and from
the Senate.
I just cannot understand what was in this bill that was so terrible
that my colleagues did not want one Democrat to be able to see it. And
I say this because as we leave here on this Memorial weekend, not one
Member of our side has been able to see my colleagues' bill. They have
come and asked me for the bill, I have referred to it to the majority
leader, and I guess he has referred it to the Speaker. But ultimately,
we should be right there on our television, on our Web site, seeing
what you rascals have really done, because you never really brought
anything to this floor.
Mr. Speaker, I am waiting to go hear just exactly what happened.
Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 3 minutes to the
gentleman from Illinois (Mr. Hastert), the Speaker of the House.
Without his focus, attention, and diligence we would not have had the
atmosphere to bring this accomplishment to fruition.
Mr. HASTERT. Mr. Speaker, I thank the gentleman from California, and
I thank him for his diligence and his hard work.
I thank my friends on the other side of the aisle. And to my good
friend, the gentleman from New York, we are all in this process, and I
think there were a couple of Democrats that were involved very heavily
in this conference for a lot of hours. I am just advising my colleagues
that revisionist history and trying to talk about different things,
facts still remain facts.
Let me just say that maybe we just ought to tone down our rhetoric
this morning, because it is not a Republican victory nor is it a
Democrat victory if this bill passes today. The American people win.
The American people, who get up in the morning, the farmer in Nebraska
this morning that has been up for 3 hours doing chores, he is going to
get a better break on his taxes. And that farm he spent his whole life
on he may be able to pass on to his children and grandchildren.
The truck driver driving across the delta of Mississippi this
morning, trying to get home to his family for Memorial Day, he is going
to get a better tax break so he can take better care of his kids and
plan for his kids' education. He wins on this.
It is the single mother in California, whose kids were up early this
morning watching the TV. Not this. They are watching cartoons. Maybe it
is the same thing. But anyway, that mother will be able to take care of
her children. She gets a better tax break. She can plan for her
children. And there are benefits for her that have never been in
another tax bill.
I hear a lot about the budget, and I hear about Presidents in the
past. It was 1996 and 1997 and 1998 and 1999 and 2000 and 2001 that
this Congress balanced the budget for the first time in 40 years. And
because we balanced the budget, we started to pay down the debt. And,
yes, in September of this year we will have paid $650 billion down in
public debt, and we have a surplus that allows us to give back to the
[[Page H2841]]
American people. It is time we give to the American people. Because if
we do not give them that surplus, we will spend it and we will have
bigger government, and we will have more programs and we will not see a
surplus again.
It is time that we get on with this issue, it is time we get on with
this work, and it is time we give the American taxpayer a tax break.
Mr. THOMAS. Mr. Speaker, I yield myself the balance of my time, and I
want to thank the Speaker and my colleagues for the opportunity and
privilege of serving. H.R. 1836 was created by a bipartisan team
following President Bush's blueprint. There is a new direction in
Washington, both in substance and in bipartisan cooperation. For a
decade of growth and for some relief to the American taxpayer, let us
vote ``yes'' on 1836.
Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise in grave opposition to
this Conference Report on H.R. 1836, the Tax Cut Reconciliation bill,
and the conservative Republican budget.
All that glitters is not gold in this tax cut. Americans need relief
now, and most of all, they need leadership. Sadly, the Majority has
sought to twist and abuse the House process to benefit the wealthy.
The Minority has been shut out of this process and kept waiting
through the night, only to be given a the draft of the plan 1 hour
before it going to the floor of the House.
The tax bill is fundamentally unfair. This bill is designed to
benefit the rich, cutting the four highest rates, and doing little for
the rest of America. Fully 70% of this tax bill goes to the top fifth
of taxpayers. The richest 1% of Americans earn 39.9% of the cut, while
most Americans get a raw deal, with the bottom fifth of all taxpayers
getting only 1.0% of the cut. This simply is not a good plan for
America. I would have voted for the one-time economic stimulus package,
which would have provided $85 billion in relief to taxpayers this year.
Now, it has grown to $421 billion.
The bill provides no marriage penalty relief until 2005, despite the
fact that the sponsors campaigned on the need for such relief. The bill
repeals the estate tax, which overwhelmingly helps the wealthy, but
does nothing about the gift tax. The repeal is effective only for the
estates of decedents dying on or after January 1, 2010, and before
January 2, 2011. This is not the kind of real tax relief that Americans
need. We can and must do better.
If we worked together in a bi-partisan fashion like we did in the
1997 Clinton balanced budget, Americans would have the relief that they
need today. Instead, under this plan we are faced with is a serious
crisis in Social Security and Medicare, all for the sake of this huge
tax cut.
What is really needed is progress that helps all Americans, and not
just the wealthy few. We need a reasonable energy policy now. We need
research and development for Lupus, Sickle Cell, and HIV AIDS, which
currently have no cure. And under the ``Leave No Child Behind''
rhetoric, our children are left behind because we short-change the
nation's educational needs.
I call on the Congress to do what is fair and what is right for all
Americans
Mrs. MALONEY of New York. Mr. Speaker, after eight years of hard
work, we finally have our financial house in order.
When I was elected in 1992, we had a $290 billion surplus.
This year, CBO projects a non-Medicare, non-Social Security surplus
of $92 billion and the combined surplus is projected at $275 billion;
under the President's budget, the non-Medicare, non-Social Security
surplus would never again be that large within the ten-year budget
window.
At a time of unprecedented surpluses, we should have tax cuts--but I
believe in responsible tax cuts--tax cuts that allow us to pay down the
debt and pay for domestic priorities such as prescription drug coverage
for seniors and improvements in education.
I favor the Democratic plan of dividing the surplus into thirds.
One-third for tax cuts, One-third for debt reduction, and One-third
for national priorities such as education and prescription drugs.
I believe in fixing the marriage penalty, but not delaying its
implementation for four years as the Bush plan proposes.
I believe in relief from estate taxes, but not for billionaires, and
not for a plan that hides its cost by not phasing in for 10 years.
I believe in giving the relief now--not ten years from now in a move
that will blow a hole in the budget and leave us with massive deficits.
We need to be clear about one thing.
The Bush tax cuts are based on 10-year budget projections that can
vary greatly and potentially lead us back to deficits.
Despite the current surplus the federal government is enjoying,
danger lies just over the horizon.
The uncertainty of the next ten years is trumped by the certainty of
the second ten.
Starting in the later half of this decade the baby boomers will begin
to retire, drastically increasing our entitlement commitments. Should
we find ourselves facing deficits in 2008 we will truly be in a dire
predicament.
Most misleading about this tax bill is that it treats taxpayers with
similar incomes far differently based on the state in which they
reside.
This is because it greatly increases the impact of the Alternative
Minimum Tax which eliminates deductions for state taxes.
While the tax cut itself is large, it is not so large that it
provides relief to the lower income Americans who pay the majority of
the taxes through payroll taxes rather than income taxes.
I don't believe in selling a tax cut as an economic stimulus package
when most of the relief will come years from now, long after this
economic cycle has passed.
The President says people should use the tax cut to pay their
skyrocketing energy bills.
However, without provided relief from payroll taxes the Bush plan
does nothing for people who are most affected by energy costs.
And I don't believe that we should cut taxes so far that we run the
risk of going back into deficit spending.
Mr. NEAL of Massachusetts. Mr. Speaker, this is a sad day for
America, but one everyone knew was coming. The bill we have before us
repeats the mistakes of the 1981 Tax Bill, mortgaging our future for
immediate political benefits.
The only question is: Who is going to play the role of Senator Dole
this time? Who is going to have the courage to begin to turn this boat
around once the immediate euphoria has passed, and the reality of what
has been done is reflected in budget estimates? How are we going to act
when the delayed effective dates come due and the hemorrhaging of
revenue occurs just as the baby boom generation begins to retire, and
our only choices are to reverse this tax bill or make deep cuts in
Medicare and Social Security?
Having said that, let me make a few comments about how the pension
provisions came out, as I understand them. I am willing to concede that
this procedure makes it difficult to know exact details, so I will rely
on the Chairman correcting me if I have misconstrued something.
I understand that the nonrefundable retirement savings account
proposal is in the conference report, as is the small business credit
for administrative costs for start up pension plans. Those are two of
the three provisions I have been working for these past three years, so
I thank the Chairman and those who supported these provisions. These
provisions, when combined with the many solid provisions like
portability, make this a better bill than when it left the House.
On the downside, I understand the House version of the
nondiscrimination rule and the top-heavy rule has prevailed, thereby in
my view weakening pension coverage for some low income workers. In
addition, the application of nondiscrimination rules to the catch up
provision has for the most part been dropped. I know Mr. Cardin was the
chief proponent of this very good policy, so I regret that outcome.
I suppose the theme of the pension provisions, as with this entire
bill, is that it is built around a number of good provisions but on the
whole it simply goes too far. And we will eventually have to clean it
up. It would be better to simply vote this down, and start again to
build a bill that solves problems in the tax code like the alternative
minimum tax and other complex issues, to the extent we can afford to do
so. I suspect that will not happen, but still I would hope Members
would vote this down and start again.
Ms. HARMAN. Mr. Speaker, I rise to oppose the reconciliation
conference report.
For close to a decade, I have made every hard vote to balance the
budget, eliminate the deficit, and reduce our $5 trillion nation debt.
I made these votes because they were responsible, and because the
alternative for my constituents and future generations was continued
economic hardship, high unemployment, high interest rates, high
mortgage rates, and a decline in the standard of living that my
generation has enjoyed.
This is another of those brutally hard choices.
I support tax cuts and have recently voted for marriage penalty
relief and eventual elimination of the estate tax.
[[Page H2842]]
I expect to vote for needed tax cuts in the future, including true
relief from the AMT, a package of relief for small business, and a
permanent research and development tax credit.
But none of these important tax cuts is included in today's package.
It includes some good features, such as improved pension portability,
expanded IRA contributions and marriage penalty relief, but it is
riddled with gimmicks and it is backloaded. Taxpayers in my district
will be enormously disappointed when they see how little relief they
actually get, and learn that, despite promises to the contrary, Social
Security and Medicare trust funds are included in budget projections.
My family and I would personally benefit from a reduction in the top
tax rate. But to their credit, they agree with me that the right vote
is not about our personal interest, but about our country's interest.
John Kennedy was right. The question is what can I do for my country?
And the answer is I can stand for principle and say ``no'' to the
easier vote.
I hope the Congressional Budget Office re-estimate of our surplus in
July is positive. But given current indicators, it is likely to be
negative. Should this be the case, the vote we take today will plunge
us back into multi-billion dollar annual deficits.
I cannot do this. I have risked my political career fighting for
fiscal responsibility. The right vote on this package--which emerged
after an all-nighter of the 107th Congress--is ``no''.
We can write a better tax cut bill and we should.
Mr. PORTMAN. Mr. Speaker, I rise in strong support of this conference
report providing needed tax relief for the American people and for our
economy. The retirement security provisions are excellent and will help
everyone save for retirement.
Unfortunately, several retirement security provisions had to be
dropped from this bill because of the Byrd rule, a Senate rule that
applies to tax bills passed under budget reconciliation rules.
Several of these provisions would make it easier for small businesses
to offer defined benefit pension plans. For example, one provision
would allow small businesses who adopt a new pension plan to pay more
reasonable PBGC insurance premiums in the early years of the plan.
Another would simplify annual reporting requirements for small plans.
We hope to work with the Education and Workforce Committee Chairman
Boehner and Subcommittee Chairman Johnson, and ranking members George
Miller and Rob Andrews to get these and the other important ERISA and
tax provisions enacted that had to be dropped from this bill for
procedural reasons.
Mr. BLUMENAUER. Mr. Speaker, I am disappointed as we vote on this tax
bill for the fifth time that no substantive change has been made to
make it more fiscally responsible and direct more help to those who
need it the most. Accordingly, I have decided keeping commitments to my
constituents in Oregon was a higher priority than voting ``no'' for the
fifth time, which I most definitely would have done.
Luckily change is in the air as recent events on Capitol Hill have
demonstrated the need for true bipartisanship and working together in a
cooperative fashion. This hopefully will mean an opportunity to improve
this package in the course of the year, and I remain committed to doing
so in a way that makes sense for the people I represent in Oregon and
the long-term fiscal stability of the country.
Mr. BEREUTER. Mr. Speaker, while this member enthusiastically votes
for H.R. 1836 to give a tax cut to American taxpayers he continues his
strong opposition to the total elimination of the estate tax on the
super-rich. The reasons for this opposition has been publicly explained
on numerous occasions, including statements in the Congressional
Record. On the other hand, this member is strongly in favor of
substantially raising the estate tax exemption level and reducing the
rate of taxation on all levels of taxable estates. However, to totally
eliminate the estate tax on billionaires and mega-millionaires would be
a terrible idea for the American society and for continuing to foster
very large charitable contributions for colleges and universities and
other worthy institutions in our country. Fortunately, I believe it
will never be eliminated in the year 2010.
Relatedly, this member includes the following opinion piece by
William H. Gates, Sr. as it appeared in the Washington Post edition of
May 25, 2001.
A Tax Break's Unfortunate Legacy
(By William H. Gates, Sr.)
The power of organized money has won another round, as the
Senate's vote to repeal the estate tax has demonstrated.
The proponents of wholesale repeal were able to wage a
campaign based largely on symbolism and distortion of fact.
They cited the plight of farmers, but when a reporter asked
for living examples of real small farmers who had lost their
farms, they couldn't be found. The deliberative tradition of
the Senate caved under the pressure of ideology over reality.
Missing has been a debate about the potential dangers of
eliminating our estate tax. What will it cost in lost federal
revenue? How will state treasuries manage without their
revenue linked to the federal estate tax? What effect will it
have on charitable giving and the nonprofit civic sector?
What happens to democracy and equality of opportunity in a
society with such great inequities of wealth and power?
And more technical questions: Are there ways to reform the
tax to address concerns about family enterprises? How would a
repeal of the ``stepped up basis,'' which exempts estates
from capital gains taxes, be administered? Instead of
discerning these vital questions, our elected leaders have
punted. By structuring full repeal to take effect 10 years
down the road, they have obscured the cost and downside of
repeal and shifted the burden onto future generations.
A hundred years ago, we did have a rigorous debate about
the need to tax large accumulations of wealth. Then, as now,
wealthy people took a stand in favor of inheritance taxes.
Andrew Carnegie personally testified before Congress in favor
of the estate tax.
The petition effort that I launched with Responsible Wealth
is a similar effort. More than a thousand prominent investors
and business leaders--from families that have paid or will
pay estate taxes--have called for reform but not repeal of
the tax. Many of the signers are owners of small businesses
who understand that concentrations of wealth and power are
not friendly to small enterprise.
The fate of the estate tax goes to the heart of the
American experiment. What has made America distinct from
Europe is our effort not to create hereditary aristocracies
and our suspicion of concentrated wealth and power weakening
our democracy. It was understood a century ago that the
estate tax was an attempt to balance conflicting American
values: on the one hand, our respect for private enterprise
and personal wealth, and on the other, our concern for
democracy and equality of opportunity. Today's debate is
missing this historical concern. In its place, we have come
to worship a myth of individual merit and success. But the
unspoken little secret is that great wealth is never entirely
the result of individual achievement. We underestimate the
role of luck, privilege and God's grace in our good fortune.
And we dismiss the incredible contribution our society makes
to creating the fertile soil for successful private
enterprise through public investment.
My own perspective celebrates individual achievement and
the hard work of entrepreneurs and leaders in our free-
enterprise system. But I also recognize that society has
played an important role in the creation of wealth. Take
anyone of the Forbes 400 and drop them into rural Africa and
see how much wealth they would amass.
Imagine that two infants are about to be born. God summons
their spirits to his office and makes them a proposition. One
child will be born in a prosperous industrialized country,
the United States. Another child will be born into a country
of society-wide abject poverty. God proposes an auction for
the privilege of being born into the United States. He asks
each new child to pledge a percentage of his earthly
accumulation at the end of his life to the treasury of God.
The child who writes the highest percentage will be born in
the United States. Does anyone think either child would
pledge as little as 55 percent, the current top-estate tax
rate?
This is not a slight of the vibrant community and human
qualities that exist in less-developed countries. I have
traveled the world in my work on health and am struck by the
quality of the human spirit. But our society has facilitated
wealth-building by creating order, protecting freedom,
creating laws to govern property relations and our
marketplace, and investing in an educated work force. What's
wrong with the most successful people putting one-quarter of
their wealth back into the place that made their wealth and
success possible? Many people repay their universities this
way. Why not their country?
For the sake of our grandchildren, I hope we can revive
this vital debate. It may not be happening in the halls of
Congress, but perhaps we can take it to the town square.
Mr. ROGERS of Michigan. Mr. Speaker, I rise in support of the
Economic Growth and Tax Relief Reconciliation Act as it fulfills two
key principles. First is the moral imperative to reduce the tax burden
on all American taxpayers, who are being taxed at historic levels. I
believe it is morally right to return some of that money back into the
pockets and purses of Americans. Quite simply, I believe tax relief is
about freedom. The more of your money are allowed to keep, the more
freedom you have to save, spend or invest your money as you see fit.
The second principle addressed by this legislation is economic
growth. Central to America's economic growth and continued prosperity
is education; but, too often students and families educational
opportunities are limited by the cost or prospect of a crushing debt-
load. The best answer to this dilemma is to encourage advanced family
savings.
[[Page H2843]]
I am pleased this conference agreement recognizes the need to provide
federal tax incentives to help and encourage families to save for
college. This legislation provides for tax-free treatment of
distributions from state-sponsored prepaid tuition or college savings
plans. This bill's language on tax-free distributions mirrors the
primary provision in legislation I introduced earlier this year, the
Securing Affordable collegiate and Vocational Education (SAVE) Act.
The cost of attending college, whether at a public or private
institution, continues to rise steadily. In order to send their
children to college, American families increasingly rely upon debt to
meet these rising college or vocational training costs. All 50 states
have responded by establishing, within section 529 of the federal tax
code, state qualified tuition programs that are free from state income
taxes.
As the author of Michigan's recently-enacted Michigan Education
Savings Program I have witnessed first-hand the demand for such common-
sense education savings plans. Although Michigan's program was only
launched in November 2000, it has been a smashing success as more than
16,000 accounts have been opened with over $34 million in investments.
The power of compounding makes these plans especially appealing to
families who can save only in smaller increments. For example, in
Michigan, families can put away as little as $10 a week over the first
18 years of a child's life and, based at a conservative earnings rate
of 8 percent, have about $20,000 by the time he or she is ready for
technical school.
When it comes to saving for college and vocational training, we need
to help our families turn from a borrowing class into a saving class.
Today's legislation takes a large step in that direction by providing
for tax-free treatment of distributions from State Qualified Tuition
Programs, like the Michigan Education Savings.
I salute Chairman Thomas for his hard work on this excellent
legislation and thank him for including this education provision that
will help millions of families nationwide. I strongly urge my
colleagues to support this legislation.
Mr. McDERMOTT. Mr. Speaker, here we go again--rushing to get this
outright deception of a tax cut through--signed, sealed and delivered
by Memorial Day. There is absolutely nothing in here for Social
Security and Medicare and even the President's plan to partially
privatize Social Security, but rather, it raids the money that is so
desperately needed for these programs. This bill slashes spending on
health care. There is nothing left for emergencies. Of course not, we
have an emergency right now with the energy crisis, and there is not a
single cent devoted to it. How many hundreds of heat-related deaths
this summer will it take for the Administration to realize that the
high energy prices is the true emergency, not tax relief?
By pursuing this tax cut, the Administration and my Republican
colleagues are consciously choosing to deny the existence of a very
serious energy crisis. In light of a potential 250% Bonneville Power
Administration (BPA) rate increase next year, the estimated Northwest
regional job loss is 224,484. Seattle City Light, serving an area of
half a million, has raised rates 30 percent.
Today, the Bush administration would say that we must rush to meet
the Memorial Day deadline for this tax bill in order to help hard-
working Americans confront the energy crisis. So much for their earlier
explanation that the economy was on the brink of a recession and could
only be saved by this massive tax cut.
I see--all the tax cut dollars will go towards paying energy bills
and stimulating the profits of the big oil companies--oil companies
such as Houston-based Enron and Dynegy that have reportedly seen
revenues climb by 400 percent in the past two years while the
Californian utilities spiraled into debt.
As for the working American families who owe no federal taxes and get
zero to nominal benefits from this blatant deception of a taxcut, how
will we help them pay their energy bills? Roughly twenty percent of
families with children will get absolutely nothing under this bill. We
will just send them into debt with utility bills. But that seems all
right with the administration. According to them, knowing you will get
$100 child credit in 18 months will have a psychological effect and
cause the parent to go shopping and stimulate the economy.
The Administration simply is closing their eyes and ears to the
facts, and hiding behind the fraudulent pretext that this tax cut is
the one and only solution for all of our country's challenges. Next,
this tax cut will decrease teen pregnancies.
It's a nutshell game. Is the money under the shell for the big oil
companies or is it for the wealthiest one percent to go on a shopping
spree?
This whole package is really about sending hard-working Americans and
our country into debt--all for the benefit of the extraordinarily rich
and major oil companies, many of whom are in Texas. A vote for this
fraud is a vote to gamble away our Nation's prosperity.
Mr. BENTSEN. Mr. Speaker, the Republican tax plan simply does not
allow them to keep all their political promises. First, we must realize
this 11-year $1.35 trillion amalgam of tax cuts does little to provide
immediate tax relief. Next we must confront the fact that the costs of
these cuts are pushed back just behind the 10-year budget horizon,
concealing their true cost.
This tax plan leads us down the path of ``spend today, borrow
tomorrow'' policy that will leave no room for adequately funding the
nation's priorities or protecting against unforseen economic downturns.
As I have said before, I support a substantial tax cut but not at the
expense of hard-fought fiscal ground and long-standing domestic
priorities, such as strengthening Social Security and Medicare,
providing a universal prescription drug benefit, and adequately funding
education and defense. With the passage of this tax cut, I do not see
how we can even fund the president's own spending priorities, such as
an expensive national missile defense system.
Mr. Speaker, I give the Republicans credit for providing a ``tax
refund'' by reducing marginal income tax rates, the cornerstone of the
President's plan. This measure puts a 10% bracket on the first $6,000
of taxable income for single filers and $12,000 for couples. However,
taxpayers subject to the 15%, 28%, 31%, and 39.6% will not start seeing
a reduction in their taxes until 2002 or 2005 or 2007, when each of the
remaining tax brackets are reduced. Putting aside the merits of how the
tax relief is distributed, I am disappointed that much of the delay in
negotiations over this package was over how much relief to give 0.7% of
taxpayers, those subject to the top marginal rate of 39.6%.
During the negotiations, I am pleased that the conferees were
convinced not to scale back the Senate's child refundable tax credit
that will now be available to working poor families. The per child tax
credit will be doubled from $500 to 1000 and will be partially
refundable to those parents earning $10,000 or more and will be
retroactive to the beginning of this year.
I am also disappointed that the Republicans, after years of vilifying
the Federal Estate and Gift Tax by calling it the ``Death Tax'' are
making the uncertain move of repealing the tax over the next 9 years.
The estate tax plan that I support, as was proposed by Mr. Rangel,
would have immediately exempted 75% of those currently subject to the
tax by raising the exemption to $4 million per couple this year. These
individuals would then not have to wait until 2010 as set out under the
Republican plan. Another troubling aspect of the Republican's approach
is that, in the absence of a federal estate and gift tax, it appears
that inherited property would be subject to carryover basis rather than
step-up in basis.
Mr. Speaker, well, how about the Republican's promise to remove the
so-called marriage tax penalty? Remarkably, here again, the Majority
willing to let the American taxpayer wait and pay. Under this package,
not until 2005 is the standard deduction for married couples raised to
twice the standard deduction available to single individuals. The plan
that I and many of my Democratic colleagues in the House support would
create an immediate standard deduction for married couples equal to
twice the standard available to single individuals. Thus, the current
law standard deduction of $7,800 per couple would be increased to
$9,300 immediately, not in 2005. Mr. Speaker, since marriage penalty
relief is a major priority for Congress, why don't we provide it until
2005?
Next, I would like to point out the white elephant in the middle of
the room that everyone seems intent on ignoring, the alternative
minimum tax (AMT). While 1.5 million taxpayers will be subject to the
AMT this year, the Joint Committee on Taxation projects that 21 million
taxpayers, including nearly half of all families of four or more, will
fall under the AMT by 2011. If the AMT is not completely corrected, the
expected tax relief for many families simply will not be realized. What
will we say in 2011 to the 19.5 million taxpayers wondering why they
are subject to the AMT?
Mr. Speaker, my central objection to this legislation is that the
conferees have hidden the true costs of the plan. We cannot claim
fiscal responsibility and overlook the structure and timing of this
legislation. I support many of the tax cuts in this package, but not
when they are clearly crafted to threaten fiscal responsibility. We all
know that the lengthy phase-ins for almost all provisions make the
package look affordable, but the more back-loaded the package the
greater the second 10-year costs as compared to the first ten-year
costs. Members and the public are told that the tax package costs $1.35
trillion. As a senior member of the House Budget Committee, I must
report that if the true costs were reflected by assuming that all the
provisions that expire are made permanent, the cost over the period
2001 to 2011 would be at least $1.7 trillion, excluding
[[Page H2844]]
interest costs. Most importantly, the cost in the second ten years is
estimated to be about $4.1 trillion. Thus, this measure that provides
little immediate relief to few Americans leaves little room for funding
national priorities such as defense and education or a universal
Medicare prescription drug benefit, paying down the debt or reforming
Social Security.
Perhaps the brightest spot of this bill is the inclusion of the
bipartisan Portman-Cardin pension legislation approved by the House. I
am thankful that this bill included tax credits taken from legislation
I introduced with my colleague. Mr. Blunt, to promote the establishment
of retirement savings plan by small businesses. Unfortunately, lifting
of the limits on IRA and 401(k) contributions has been slowed, reducing
the amount that Americans can save over the next decade. The time is
upon us to plan for the retirement of the Baby Boom generation. We
cannot keep putting off Social Security reform or providing a
prescription drug benefit or, for that matter, enhancing pension
savings.
For reasons of fiscal responsibility, Mr. Speaker, I oppose the
Conference Report to H.R. 1836.
The SPEAKER pro tempore (Mr. LaHood). Without objection, the previous
question is ordered on the conference report.
There was no objection.
The SPEAKER pro tempore. The question is on the conference report.
Pursuant to House Resolution 153, the yeas and nays are ordered.
The vote was taken by electronic device, and there were--yeas 240,
nays 154, not voting 39, as follows:
[Roll No. 149]
YEAS--240
Abercrombie
Aderholt
Akin
Armey
Bachus
Baker
Ballenger
Barcia
Barr
Bartlett
Barton
Bass
Bereuter
Berkley
Biggert
Bilirakis
Blunt
Boehlert
Boehner
Bonilla
Bono
Brady (TX)
Brown (SC)
Bryant
Burr
Burton
Buyer
Callahan
Calvert
Camp
Cannon
Cantor
Capito
Capps
Carson (OK)
Castle
Chabot
Chambliss
Clement
Coble
Collins
Combest
Condit
Cooksey
Cox
Cramer
Crane
Crenshaw
Culberson
Cunningham
Davis, Jo Ann
Davis, Tom
Deal
DeLay
DeMint
Diaz-Balart
Dooley
Doolittle
Dreier
Duncan
Dunn
Ehlers
Ehrlich
Emerson
English
Everett
Ferguson
Flake
Fletcher
Foley
Fossella
Frelinghuysen
Gallegly
Ganske
Gekas
Gibbons
Gilchrest
Gilman
Goode
Goodlatte
Gordon
Goss
Graham
Granger
Graves
Green (WI)
Greenwood
Grucci
Gutknecht
Hall (TX)
Hansen
Hart
Hastert
Hastings (WA)
Hayes
Hayworth
Hefley
Herger
Hilleary
Hobson
Hoekstra
Hooley
Horn
Hostettler
Hulshof
Hunter
Hutchinson
Hyde
Israel
Issa
Istook
Jenkins
John
Johnson (CT)
Johnson (IL)
Johnson, Sam
Keller
Kelly
Kennedy (MN)
Kerns
Kingston
Kirk
Knollenberg
Kolbe
LaHood
Largent
Larsen (WA)
Latham
LaTourette
Leach
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas (KY)
Lucas (OK)
Manzullo
Matheson
McCarthy (NY)
McCrery
McHugh
McInnis
McKeon
Mica
Miller (FL)
Miller, Gary
Moore
Moran (KS)
Morella
Myrick
Nethercutt
Ney
Northup
Norwood
Nussle
Osborne
Ose
Otter
Oxley
Paul
Pence
Peterson (MN)
Peterson (PA)
Petri
Pickering
Pitts
Platts
Pombo
Portman
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Rehberg
Reynolds
Riley
Roemer
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Ross
Roukema
Royce
Ryan (WI)
Ryun (KS)
Sandlin
Saxton
Schaffer
Schiff
Schrock
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shows
Shuster
Simmons
Simpson
Skeen
Smith (MI)
Smith (NJ)
Smith (TX)
Souder
Stearns
Stump
Sununu
Sweeney
Tancredo
Tauscher
Tauzin
Taylor (NC)
Terry
Thomas
Thornberry
Thune
Tiahrt
Tiberi
Toomey
Traficant
Turner
Upton
Vitter
Walden
Wamp
Watkins
Watts (OK)
Weldon (FL)
Weldon (PA)
Weller
Whitfield
Wicker
Wilson
Wolf
Young (AK)
Young (FL)
NAYS--154
Allen
Andrews
Baird
Baldacci
Baldwin
Barrett
Berman
Berry
Blagojevich
Bonior
Borski
Boswell
Boucher
Brady (PA)
Brown (FL)
Brown (OH)
Capuano
Cardin
Carson (IN)
Clay
Clyburn
Conyers
Costello
Crowley
Cummings
Davis (CA)
Davis (FL)
Davis (IL)
DeFazio
DeGette
Delahunt
DeLauro
Deutsch
Dicks
Dingell
Doyle
Edwards
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank
Frost
Gephardt
Gonzalez
Green (TX)
Gutierrez
Harman
Hastings (FL)
Hill
Hilliard
Hinchey
Hinojosa
Holden
Holt
Hoyer
Inslee
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson, E. B.
Jones (OH)
Kanjorski
Kennedy (RI)
Kildee
Kilpatrick
Kind (WI)
Kleczka
Kucinich
LaFalce
Lampson
Langevin
Lantos
Larson (CT)
Lee
Levin
Lewis (GA)
Lofgren
Lowey
Luther
Maloney (CT)
Maloney (NY)
Markey
Mascara
Matsui
McCollum
McGovern
McKinney
McNulty
Meehan
Meeks (NY)
Menendez
Miller, George
Mink
Mollohan
Moran (VA)
Murtha
Nadler
Napolitano
Neal
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Phelps
Pomeroy
Price (NC)
Rangel
Reyes
Rivers
Rothman
Roybal-Allard
Sabo
Sanchez
Sanders
Sawyer
Schakowsky
Scott
Serrano
Sherman
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Stenholm
Strickland
Stupak
Tanner
Taylor (MS)
Thompson (CA)
Thompson (MS)
Thurman
Tierney
Udall (CO)
Udall (NM)
Velazquez
Visclosky
Watt (NC)
Weiner
Wexler
Woolsey
Wu
NOT VOTING--39
Ackerman
Baca
Becerra
Bentsen
Bishop
Blumenauer
Boyd
Clayton
Coyne
Cubin
Doggett
Gillmor
Hall (OH)
Hoeffel
Honda
Houghton
Isakson
Jones (NC)
Kaptur
King (NY)
Lipinski
McCarthy (MO)
McDermott
McIntyre
Meek (FL)
Millender-McDonald
Moakley
Oberstar
Quinn
Rahall
Rodriguez
Rush
Scarborough
Spence
Towns
Walsh
Waters
Waxman
Wynn
{time} 1011
So the conference report was agreed to.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated against:
Mr. McDERMOTT. Mr. Speaker, on rollcall No. 149, final passage of
H.R. 1836, adoption of the conference report, I was unable to be
present. Had I been present, I would have voted ``nay.''
Ms. McCARTHY of Missouri. Mr. Speaker, during rollcall vote No. 149,
due to difficulties associated with my travel logistics, I was
unavoidably detained. Had I been present, I would have voted ``nay.''
____________________