[Congressional Record Volume 149, Number 59 (Friday, April 11, 2003)]
[Senate]
[Pages S5373-S5374]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. LANDRIEU (for herself and Mr. Corzine):
  S. 911. A bill to amend the Internal Revenue Code of 1986 to provide 
a rebate of up to $765 to individuals for

[[Page S5374]]

payroll taxes paid in 2001, to provide employers with an income tax 
credit of up to $765 for payroll taxes paid during the payroll tax 
holiday period, and for other purposes; to the Committee on Finance.
  Ms. LANDRIEU. Mr. President, we are living in difficult economic 
times. Too many people are out of work and the economy is not growing 
enough to put them back to work permanently. The March unemployment 
rate was 5.8 percent and it has been holding around this mark for about 
a year. More bad news came just last week when the number of jobless 
claims soared to 445,000 for the week ending March 29. That is the 
highest number of weekly claims for unemployment benefits in almost a 
year.
  While unemployment has been rising, other economic indicators are 
dropping. New orders for manufactured goods in February decreased $4.9 
billion or 1.5 percent; shipments also fell 1.5 percent, the largest 
decrease since February of last year.
  These cold, hard numbers cannot measure the unease and uncertainty 
many Americans feel today. The Conference Board Consumer Confidence 
Index fell 2 more points in March after a 3 point drop in February. 
When your neighbor is out of work and cannot find a job, you worry that 
you might be next. So you hold off on buying that new washing machine, 
the new car you need to get to work, or you put that dream vacation on 
hold. Americans have experienced losses in their pensions and 401(k) 
plans. When you combine all of this with the uncertainty surrounding 
the war against terrorism and the war with Iraq, you create a great 
drag on the economy.
  I think all of my colleagues agree that the economy is not where we 
want it to be right now. We agree that it needs a booster shot. We have 
partisan disagreement over specifics and the size of the stimulus. But 
if we put aside our partisan differences, I believe we can come up with 
a bipartisan solution to help the economy in the short term.
  We can accomplish this if we agree on a few, narrow principles for an 
economic stimulus plan. First, we should aim toward providing an 
immediate boost to the economy. We do not need tax cuts that will only 
begin to help several years downs the road. The economy needs help 
today. Second, the urgent need for the boost today means that the 
economic stimulus plan must be simple and easy to administer so that 
full effects can be felt right away. Third, I believe that a stimulus 
plan must be fiscally responsible. While the economy needs a boost 
today, that boost should not come at the expense of our ability to meet 
our needs tomorrow. And finally, the stimulus package must be 
equitable. It must be fair. It should touch all Americans, not just a 
select few.
  Today, along with my colleague Senator Corzine, I am introducing one 
idea for economic stimulus that meets all of these principles. We 
propose that all working Americans receive tax relief equivalent to the 
amount of payroll taxes paid on the first $10,000 of earnings--a total 
of $765. The rebate would be made in two installments. The first would 
come within 2 months of passage of the bill and the second would come 
by December 1st of this year. Employers would also receive an 
equivalent tax credit for their employees.
  This plan meets the principles I have outlined. It is a short-term 
plan that will put spending money in the hands of working Americans. It 
will be simple to administer--rebate checks were a part of the tax cut 
we passed in 2001. The plan is fiscally responsible: the rebate checks 
will be paid out of general revenues and not from the Social Security 
trust fund. Finally, this plan is fair. Every working American will 
benefit.
  Mr. President, I hope the Congress will act quickly to revive our 
economy. Today, Senator Corzine and I are putting one idea forward. My 
colleagues have a variety of other ideas that they will put forward. 
The Senate should look at each and put together a final package that is 
simple, immediate, fair, and fiscally responsible.
  Mr. CORZINE. Mr. President, I am proud to join with Senator Landrieu 
in introducing the Wage Tax Cut Act, legislation that would provide an 
immediate boost to America's economy by providing wage tax relief to 
all working Americans and to businesses.
  In short, this proposal would give all working Americans a wage tax 
break of up to $765, equivalent to the payroll taxes they have paid on 
the first $10,000 of their earnings in the year 2001. Working couples 
would receive tax relief of up to $1,530. This is a 1-year proposal in 
which all payments and tax credits would come out of the General 
Treasury. The Social Security and Medicare trust funds would not be 
affected in any way.
  Every working American and business-owner would benefit from our 
proposal. This $765 tax cut would help American families make ends meet 
and stimulate the economy. It would pay for 5 week's worth of groceries 
for a family of four; more than 2 months of child care; 3\1/2\ months 
of utility bills; and 7 months of gasoline.
  The act would provide business-owners--small and large--a tax credit 
for up to $765 on the wages of each of their employees. The tax credit 
for businessowners would put more money in the hands of employers to 
spur investment in new people, plant, and equipment. By reducing 
payroll taxes, which amount to a tax on labor, we would encourage more 
employers to hire new personnel, and to keep those they now have.
  That is why the Business Roundtable, which represents 150 of the 
country's largest corporations with over 10 million employees, has 
endorsed the concept of payroll-based tax relief that we are proposing 
today.
  This is a simple, fair, and affordable economic stimulus plan that 
will get money in the hands of consumers and businesses that will be 
immediately reinvested in our economy.
  Unlike the President's proposed tax plan, the Wage Tax Cut Act would 
provide immediate help to the economy, without being fiscally 
irresponsible. At $180 billion, its cost is only about 15 percent of 
the $1.3 trillion in tax cuts included in the conference report on the 
budget resolution.
  At this important time in our Nation's history, when thousands of 
young men and women are bravely serving their country, we need to 
ensure that the America to which they return is vibrant and strong. 
This proposal would help create the jobs they need, and the prosperity 
they deserve.
  In December 2001, when Senator Bill Frist supported--in fact his own 
Web site articulated--the stimulative impact that payroll tax relief 
could have. It quoted the senator as saying:

       A payroll tax holiday is truly a stimulative, temporary tax 
     cut that would be welcome news for most Americans, especially 
     during the holiday season. As economic growth stagnates and 
     unemployment numbers increase, putting additional money in 
     consumers' pockets will provide a much needed economic boost.

  Senator Frist continued:

       The key is for Congress to respond and pass a stimulus bill 
     now, and I believe that this proposal could provide us with a 
     bipartisan solution.

  Senator Frist was right on the mark about the need, and stimulative 
impact, of payroll tax relief then. It is my hope that Majority Leader 
Frist, and the rest of my colleagues, today will stand behind those 
words and support this proposal to help reinvigorate out economy.
                                 ______