[Congressional Record Volume 149, Number 137 (Wednesday, October 1, 2003)]
[House]
[Pages H9067-H9071]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




MOTION TO INSTRUCT CONFEREES ON H.R. 1308, TAX RELIEF, SIMPLIFICATION, 
                         AND EQUITY ACT OF 2003

  Mr. DAVIS of Alabama. Mr. Speaker, I offer a motion to instruct.
  The SPEAKER pro tempore. The Clerk will report the motion.
  The Clerk read as follows:

       Mr. Davis of Alabama, moves that the managers on the part 
     of the House in the conference on the disagreeing votes of 
     the two Houses on the House amendment to the Senate amendment 
     to H.R. 1308 be instructed as follows:
       1. The House conferees shall be instructed to include in 
     the conference report the provision of the Senate amendment 
     (not included in the House amendment) that provides immediate 
     payments to taxpayers receiving an additional credit by 
     reason of the bill in the same manner as other taxpayers were 
     entitled to immediate payments under the Jobs and Growth Tax 
     Relief Reconciliation Act of 2003.
       2. The House conferees shall be instructed to include in 
     the conference report the provision of the Senate amendment 
     (not included in the House amendment) that provides families 
     of military personnel serving in Iraq, Afghanistan, and other 
     combat zones a child credit based on the earnings of the 
     individuals serving in the combat zone.
       3. The House conferees shall be instructed to include in 
     the conference report all of the other provisions of the 
     Senate amendment and shall not report back a conference 
     report that includes additional tax benefits not offset by 
     other provisions.
       4. To the maximum extent possible within the scope of 
     conference, the House conferees shall be instructed to 
     include in the conference report other tax benefits for 
     military personnel and the families of the astronauts who 
     died in the Columbia disaster.
       5. The House conferees shall, as soon as practicable after 
     the adoption of this motion, meet in open session with the 
     Senate conferees and the House conferees shall file a 
     conference report consistent with the preceding provisions of 
     this instruction, not later than the second legislative day 
     after adoption of this motion.

  Mr. DAVIS of Alabama (during the reading). Mr. Speaker, I ask 
unanimous

[[Page H9068]]

consent that the motion be considered as read and printed in the 
Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Alabama?
  There was no objection.
  The SPEAKER pro tempore. Pursuant to clause 7 of rule XXII, the 
gentleman from Alabama (Mr. Davis) and the gentleman from Minnesota 
(Mr. Ramstad) each will control 30 minutes.
  The Chair recognizes the gentleman from Alabama (Mr. Davis).
  Mr. DAVIS of Alabama. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, periodically when I go back to my district, one of the 
questions I get most frequently asked is, why do we keep turning on our 
C-SPAN television in the afternoon and hearing this debate on the child 
tax credit? Why do we keep seeing these motions brought to the floor?
  I suppose the best answer that I can give, Mr. Speaker, the best 
answer I can give my colleagues is a very simple one. The reason that 
this side of the aisle continues to press this issue, the reason that 
this side of the aisle continues to implore our colleagues to act is 
because more than any other issue, any other debate we have encountered 
this year, this question speaks to the fundamental difference between 
our parties.
  We continue to make these points because it speaks for, frankly, why 
we stand on the Democratic side as opposed to the Republican side. And 
while we may do this every few days, it is always helpful to look at 
the history of how we got here.
  Late in the evening of the night that the Republican-inspired tax cut 
passed this body, there was a relentless effort to get inside the $350 
billion number, and for all of the efforts of all of the geniuses that 
we have on the other side and all of the efforts that were expended on 
getting inside this limit, there were $3.5 billion outside of $350 
billion.
  One would wonder, if you had to save $3.5 billion at the last minute 
of a long debate, where would you turn? You might turn to the various 
corporations who are using offshore accounts in the Bahamas. You might 
turn to people who are earning over a million dollars a year and 
getting a tax cut. You might turn to some of the obvious examples of 
waste and fraud that could have been found. But rather than turn to any 
of those places, the Republican leadership decided to literally reach 
into the pockets of families earning between $10,000 and $26,000 a 
year, the very weakest people in our society.
  We have learned just in the last few weeks that the number of 
children living in poverty has grown by 1 million in the last year. We 
have learned in just the last few weeks that after a decade of people 
moving from poverty to the middle class, that the trend is now in the 
other direction. Every single month, different numbers of families fall 
below the statistical line that separates deprivation in this country 
from some measure of success.
  For all of the differences and all of the debates that we have on 
this floor, I can confidently say that my party would never reach into 
the pockets of the most vulnerable families in this country to satisfy 
a $350 billion tax cut number. We need to, and frankly it is nothing 
less than shameful, Mr. Speaker, that in the last months we have not 
managed to, find a way to make this simple, corrective step.
  We have heard some on the other side of the aisle say, well, why give 
a tax credit to families earning between $10- and $26,000 a year or why 
expand the tax credit for them? A lot of them do not pay taxes, we have 
heard. Or a lot of them do not pay a lot of taxes. The reality is, of 
course, these individuals do pay State income taxes and in many of our 
States in this time of tough budget woes, those individual State tax 
burdens are rising.
  We also know, frankly, that there has never been any controversy 
around the child tax credit applying to low-wage-earning families. 
There has never been any controversy over whether the original $600 
credit applied. The controversy over this credit arose only when the 
majority needed to save $3.5 billion.
  It is interesting that the President wants to fix this. It is 
striking that the U.S. Senate has voted almost unanimously to fix it, 
but for some reason, the Republican leadership in the House continues 
to be unmoved on this question. To put the cynicism in some context, 
H.R. 1308, the bill that was brought to this floor that purports to fix 
the gap in the child tax credit does not even allow the tax credit to 
kick in for these families until sometime next year.
  There is another basic point, Mr. Speaker. We are experiencing a 
stagnant, slow, jobless recovery. We are experiencing a recovery where 
companies are saving costs by cutting back on health insurance and 
laying off workers. It is a very stale recovery for a lot of our 
people.
  So the President talks about stimulus. The President talks about 
providing a jolt to this economy. What better way to put some life in 
this economy, what better way to put some energy and some spending 
power into this economy than by giving this credit to families who are 
struggling by the margins every single day to survive, the families 
earning between $10- and $26,000? If stimulus is the rationale for this 
tax cut, there is no reason that this credit should not be extended to 
these families.
  Mr. Speaker, I certainly look forward to this debate today. I 
certainly invite my colleagues to finally do the right and simple 
thing, to spend $3.5 billion to fix a problem of fundamental fairness.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RAMSTAD. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I believe the Members of the body are very familiar with 
the issues at stake in this motion to instruct conferees, for I believe 
this is the 13th time now that this body has debated the motion.
  Let me say at the outset, Members on both sides of the aisle want to 
provide for immediate increased refundability of the child credit. That 
is exactly what the bill that passed the House would provide to many 
low-income families. But let me remind my colleagues of the families 
who would be disadvantaged by this motion to instruct conferees and 
this goes really to the heart of this debate, Mr. Speaker.
  Under the motion brought by my friend from Alabama, the same low-
income families who would benefit from the increased refundability of 
the child credit would see their credit actually drop in the year 2005, 
after the elections. By contrast, the House-passed bill would ensure 
that the child credit remains at $1,000 per child through the year 
2010. Will low-income families need this crucial tax relief any less in 
the year 2005? Of course not.
  Under the motion brought by my friend from Alabama, the marriage 
penalty in the child credit would be eliminated only in the year 2010. 
By contrast, the House-passed bill immediately eliminates the marriage 
penalty, which is unfair and unconscionable and discriminates against 
people who are married, taxpayers who are married, and denies millions 
of children the full benefit of the child credit simply because their 
parents are married. Why should a married couple anywhere, let us say a 
teacher and a firefighter, be denied this crucial tax relief for their 
children?
  Under the motion also brought by my friend from Alabama, families 
would actually receive less tax relief, those families in the military. 
Let me repeat that. Military families would actually receive less tax 
relief under the motion brought by my friend from Alabama.
  Under the House-passed bill, the child credit is not denied to 
military families. Military families, including those serving so 
bravely abroad, are already receiving a refundable child credit and 
will continue to receive this credit under the House-passed bill. This 
motion to instruct would only increase the refundable child credit for 
some military families by allowing them to take into account tax-free 
income when they compute their refundable credit. At the same time, the 
motion to instruct would deny over $800 million in tax relief to 
military families. That is a lot of money and that is real money to 
those troops serving us so bravely and so well.
  The House bill contains the military tax relief that has passed this 
body a number of times. By contrast, the bill passed by the other body, 
which this motion to instruct would have us adopt, does not contain 
this essential

[[Page H9069]]

tax relief for the brave men and women defending our country.
  Mr. Speaker, let me remind my colleagues of the military tax relief 
that is missing, that is absent from the other body's bill. Our House-
passed tax relief bill ensures that members of the Armed Forces and 
Foreign Service are not denied the very important capital gains 
exclusion on home sales if they cannot meet the 5-year residency test 
because they are transferred away from home on official extended duty, 
which happens obviously frequently to members of both the Armed Forces 
and the Foreign Service.
  Our bill ensures that the full $6,000 death gratuity payment received 
by survivors of military personnel is tax-free. Only half of the 
payment is tax-free under current law.
  Our bill furthermore ensures that payments received by members of the 
Armed Forces under the home owners assistance program are tax-free. 
These payments compensate our men and women of the military for a drop 
in home values resulting from military base closures or realignments.
  Moreover, our bill extends the combat zone filing rules to 
individuals serving in contingency operations so they are given more 
time to file tax returns and meet other deadlines. As I have heard from 
many military families who have loved ones in combat zones currently, 
this provision is also very important.
  Further, Mr. Speaker, our bill modifies the definition of a qualified 
veterans organization to make it easier for veterans organizations to 
retain their tax-exempt status. This is very important, as members of 
the American Legion and VFW and the other veterans organizations have 
told me repeatedly.
  Also, Mr. Speaker, our bill clarifies that dependent care assistance 
provided under a military dependent care assistance program is tax-
free.

                              {time}  1345

  Further, the House-passed bill ensures that families are not hit with 
that dreaded 10 percent penalty for withdrawals from their Qualified 
Tuition Plans from Section 529 Plans or the Coverdell Education Savings 
Account if their children are appointed to military academies. This 
practice is simply wrong, and we correct that. This is the same 
treatment given to families whose children receive scholarships.
  Finally, Mr. Speaker, our House-passed bill provides an above-the-
line deduction for up to $1,500, $1,500 of training expenses incurred 
by members of the National Guard and Reserve who serve more than 100 
miles away. I am proud to say, Mr. Speaker, that this provision is 
based on legislation I sponsored with the help of many others on both 
sides of the aisle.
  So let me conclude, Mr. Speaker, by saying this, and this really is 
the bottom line: The House-passed bill provides more tax relief to more 
families. The House-passed bill provides more tax relief to more 
members of our military. I urge my colleagues to defeat this motion.
  Mr. Speaker, I reserve the balance of my time.
  Mr. DAVIS of Alabama. I yield myself such time as I may consume.
  I certainly agree with my friend from Minnesota that we need to 
correct the disparity of military families being left out of this 
relief. We need to correct all the omissions regarding military 
families, and for that reason this motion to instruct would provide 
coverage for families of military personnel serving in Iraq, 
Afghanistan, and other combat zones as an essential and critical of 
part this conference report.
  Mr. Speaker, I yield 2 minutes to the gentleman from the great State 
of Texas (Mr. Hinojosa) whose district includes so many families who 
would be deeply affected by this motion to instruct and who has been 
such a consistent advocate for children living in poverty in this 
country.
  Mr. HINOJOSA. Mr. Speaker, I thank the gentleman from Alabama (Mr. 
Davis) for yielding me this time.
  Mr. Speaker, for 109 days now, we have demanded fairness for the 6.5 
million families that were denied their equitable share of the child 
tax credit provisions in the Jobs and Growth Tax Relief Reconciliation 
Act. These families, headed by workers who pay taxes from their 
paychecks and on their purchases as well as paying property taxes and 
excise taxes, represent 12 million children. Those families include 
rural families. The 12 million children are more than half of the sons 
and daughters of rural farmers and farm workers. They are one out of 
every four children of nurses and nurses' aids. They are more than half 
of the children of janitors, maids, and cooks. The children left out 
are one in ten children of teachers and teachers' aids. More than 
120,000 of these children are the dependents of active military 
personnel.
  Just as we must not leave children behind in the classroom, we cannot 
ignore working families and their children when the Treasury Department 
mails out checks. We have said it again and again and again: Tax relief 
for families should be fair and equitable. We must come together and 
provide a refundable credit to demonstrate our commitments to all 
working families.
  Mr. Speaker, I support the Davis motion to instruct, and I urge 
everyone else to vote in favor of this motion.
  Mr. RAMSTAD. Mr. Speaker, I reserve the balance of my time.
  Mr. DAVIS of Alabama. Mr. Speaker, I yield 5 minutes to the gentleman 
from Georgia (Mr. Bishop). The gentleman from Georgia has distinguished 
himself in this institution not just as a voice for fiscal prudence and 
fiscal sanity as a conservative Democrat, but he has also distinguished 
himself as a distinguished advocate for the families who are left 
behind in this country. His district, like mine, includes large numbers 
of rural families and large pockets of children living in poverty.
  Mr. BISHOP of Georgia. Mr. Speaker, I thank the gentleman for 
yielding me this time.
  Mr. Speaker I rise today in support of the gentleman from Alabama's 
(Mr. Davis) motion to instruct conferees on H.R. 1308, the child tax 
credit, and I thank the gentleman for this very important motion 
because tax relief and tax fairness are the very core of what we in 
Congress should be doing to improve the lives of Americans in each and 
every community across this Nation.
  Mr. Speaker, let me take a moment to recognize the bipartisan work of 
the United States Senate which has already voted 94 to two to provide 
Americans with real and meaningful tax relief in the form of a child 
tax credit. The Senate knew that this was the right thing to do, and 
they made no bones about coming together for hard-working American 
families. In fact, the President of the United States, through his 
press secretary, said that we ought to pass this legislation, 
legislation that has been held hostage in this House by the Republican 
leadership for 111 days. This is wrong, Mr. Speaker, and it ought not 
to happen in America because tax relief for American families, a real 
child tax credit, is not a Democrat issue, not a Republican issue. It 
is a children issue.
  The relief it provides is targeted to parents who need it the most, 
those earning between 10,000 and $26,000 a year, about 6.5 million 
families and 12 million children. They await relief while the 
Republican leadership in the House stalls on this bill.
  The House version of the child tax credit also shortchanges our 
servicemen and women and particularly those who are putting their lives 
on the line in Iraq. The House Republican leadership insisted that the 
calculation of the allowable child tax credit be based on taxable 
income, that is, wages in excess of personal exemptions and deduction, 
rather than on total earned income. This accounting gimmick adversely 
affects our military personnel who are in combat because, while in 
combat, their pay is not treated as taxable income. For example, a 
stateside grade E-6 serviceman or woman earning $29,000 a year, 
supporting a spouse and two children, would enjoy the full $1,000 child 
tax credit for each of their two children. But if that servicemember is 
deployed in Iraq for as much as 8 months, he or she could lose the 
entire child tax credit. That is because two-thirds of his or her 
income would not be taxable and the remaining one-third would fall 
below the $10,500 threshold at which the refundable portion of the 
child tax credit begins to be calculated. In fact, some 260,000 
children, one in five children of the military, in 200,000 active duty 
military families would be left out of this unfair House version while 
the

[[Page H9070]]

Senate version avoids this problem entirely.
  Last month the census released new figures showing that the number of 
families and children living between below the poverty line rose by 1.3 
million last year, 1.3 million more families than there were last year. 
Times are really tough. They need help, Mr. Speaker, and they need it 
now. I would like to say that help is on the way, but the truth be 
told, Mr. Speaker, help is going away. Our fiscal priorities are not in 
touch with real needs.
  A recent House Committee on the Budget staff analysis reveals that 
the true cost of the war in Iraq and the postwar reconstruction effort 
will be more than $178 billion and could exceed $400 billion during the 
period 2003 to 2013. That is pretty big money. Who pays that bill? 
Hard-working Americans and their families, including the servicemen and 
women who have been disproportionately disadvantaged by the unfair tax 
policy in America today.
  In May of this year, this House passed a tax cut, despite the 
mounting deficit and the cost of the war in Afghanistan and Iraq. I am 
a big supporter of tax relief, but the last round of tax cuts excluded 
the full benefit for most working Americans and was fiscally 
irresponsible.
  We have before us today an opportunity to level that playing field 
for most American families. I hope that we will. I urge my colleagues 
to stand with us for tax fairness and to vote for the gentleman from 
Alabama's (Mr. Davis) motion to instruct conferees on this very 
important bill.
  Mr. RAMSTAD. Mr. Speaker, I yield myself 30 seconds.
  Mr. Speaker, I would just remind the body that the motion to instruct 
brought by my friend from Alabama would deny over $800 million in tax 
relief to members of the military and their families.
  Mr. Speaker, I reserve the balance of my time.
  Mr. DAVIS of Alabama. Mr. Speaker, I yield myself such time as I may 
consume.
  I think we may just simply have a factual disagreement between my 
friend from Minnesota and myself. The motion to instruct would include 
those families.
  Mr. Speaker, I yield 2 minutes to the gentleman from New Jersey (Mr. 
Pallone) who has so often come to the well of this House to speak on 
behalf of our party and to speak on behalf of families in need in this 
country.
  Mr. PALLONE. Mr. Speaker, I thank my colleague from Alabama for 
yielding me this time.
  I want to point out I have been on this floor so many times making 
the same point which is that my Republican colleagues, including the 
gentleman from Minnesota, keep talking about the House bill, the House-
passed Republican bill, and how that is so much more generous and is 
going to provide much more tax relief than the bill that passed the 
other body. But the bottom line is we know that this House bill will 
never become law. And the whole purpose of this exercise was to make 
sure that these kids and their families making between the 10- and 20-
something thousand dollars a year annual income would be able to get 
the same kind of child tax credit or relief as the other families of 
higher incomes. And so the other body passed a bill that would simply 
do that and nothing more. It cost, I think, about $3.5 billion, and it 
was paid for by some kind of increased customs duty, fully paid for. It 
does not increase the debt.
  What the Republicans in the House do, they come in and say that is 
not good enough. We have got to pass a much larger bill. I think it is 
$80 billion, but there is no money to pay for that. So when our 
Republican colleagues in this House keep saying they want this larger 
bill that is going to do all these wonderful things and provide all 
this additional tax relief, that is just another way of saying we do 
not want anything because they have not had the conference even meet. 
The two bodies have not gotten together. The chairman of the House 
Committee on Ways and Means has made it quite clear that he is really 
not interested in having any kind of compromise or effort to reach out 
to the other body on this issue.
  So we have a stalemate because the House Republicans refuse to have a 
conference, refuse to meet, and refuse to simply go along with the bill 
passed by the other body. So I mean this is becoming increasingly a 
joke.
  The bottom line is the House Republicans have no intention of ever 
passing anything that is going to pass both houses and go to the 
President's desk. And unless that happens, it is just a cruel hoax on 
these families that they are ever going to get any kind of relief. I am 
not interested in hearing what is going to happen in 2 years or what is 
going to happen with the people that are not directly impacted by this. 
We have already had several tax cut bills that have provided money back 
to taxpayers, mostly at the high end. We just simply want to address 
this problem for these people in this income bracket who are working, 
who are paying taxes, and who need some relief. And it is a question of 
fairness; they should get the same $400 that everybody else gets.
  I have mentioned many times, July came around, I got a $1,200 check. 
A Member of Congress, I guess we make about $150,000 a year. I have 
three children, so I got $1,200. But the other person on my block who 
is at the lower-income scale, still working as hard I am, they did not 
get the money, and it is not fair. As far as the military is concerned, 
they can just take up the bill that is at the desk here and provide the 
relief to the military families. But do not talk to us about this House 
bill that is more generous, is going to provide more money, provide 
more tax relief. That is ``pie in the sky.'' We have a $500 billion 
deficit. That is never going to happen.
  Mr. RAMSTAD. Mr. Speaker, I yield myself 30 seconds.
  Mr. Speaker, I would just remind my friend from New Jersey that this 
is not a joke to many low-income families. Under the motion brought 
here today, the same low-income families who would benefit from the 
increased refundability of the child credit would see their credit 
actually drop in 2005, coincidentally, right after the elections. By 
contrast the House-passed bill would ensure that the child credit stays 
at $1,000 per child through the year 2010. I challenge anyone to say 
that low-income families would need this crucial tax relief any less 
after 2005. This is not a joke. This is serious business.
  Mr. Speaker, I yield back the balance of my time.

                              {time}  1400

  Mr. DAVIS of Alabama. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, we do have these debates every few days; and nothing 
new, frankly, has been said over the course of the last 4 months. That 
is depressing, in some sense; but I think, again, it speaks to the very 
fundamental difference between our parties.
  No one has yet to come to the well of this House, and today only one 
speaker even bothered to come down to debate this issue from the other 
side; no one has yet to come to the well of this House from the 
Republican side of the aisle to explain why we leave behind families 
earning between $10,000 and $26,000 when it would not cost us more than 
$3.5 billion. No one has explained why we leave out of a stimulus 
package the families who are most in need of having their economic 
fortune stimulated.
  The gentleman from New Jersey (Mr. Pallone) is exactly right. The 
very leadership that brought this bill to the floor, and actually, to 
be perfectly correct about it, it is not a bill. The Republican 
leadership, rather than actually bringing a bill to the floor, brought 
a rule to the floor and invoked a rare procedural maneuver to take this 
measure directly to conference, rather than to bring it forward as a 
bill. Putting that aside, the very leadership that brought this rule to 
the floor announced a day beforehand that the child tax credit was 
dead. That had no intent, they have no intent, and they will have no 
intent to ever create this expanded relief for the families in our 
country who are working so hard.
  I close on this note, Mr. Speaker. We wonder sometimes why so few 
low-income people participate in the voting process in this country. We 
wonder sometimes why so many low-income families feel left out and feel 
locked out. We wonder why they feel disengaged. When we have our town 
hall meetings, they do not even bother to come. We have an answer to 
that question with the way this issue has been

[[Page H9071]]

handled: because these individuals who are locked out of so many things 
in life turn on their television and they hear that tax relief is being 
passed for millionaires, they hear that tax relief is being passed for 
the owners of large corporations, and they hear that wider and broader 
and additional tax relief is contemplated. Yet they hear that they are 
not worthy of additional relief at all. They are told, as some of my 
colleagues on the other side have said, that they are welfare cases who 
really do not contribute to the system and really do not pay taxes 
anyway, so why get any kind of benefit.
  We ought to recognize as elected officials, Mr. Speaker, that we 
cannot leave people out of the system and expect them to continue to 
have faith in the system. That may be a small cost to my colleagues on 
the other side of the aisle, because a lot of these folks are not a big 
part of their voter base, but they are part of the America that we 
have. This party that I speak for today will always be proud to speak 
for these families, because the kids in this country who live in 
families earning at the edge of the poverty line and slightly above it, 
they cannot come to this city and have fly-in week. They cannot hold 
$50,000 fund-raisers. They cannot hold thousand-dollar-a-head events. 
Somebody has to speak for them. Somebody has to take the time to come 
to this floor to speak for their needs and advocate for their cause. 
The ones of us who do that represent the Democratic Party in America, 
and those of us on this side of the aisle will always be proud to be 
part of the party that speaks for those who have been left behind, who 
lack any other voice.
  So with that said, I urge my colleagues to vote for this motion to 
instruct and to finally fix this fundamental unfairness in what was 
purported to be a tax fairness bill earlier this year.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Bass). Without objection, the previous 
question is ordered.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to instruct 
offered by the gentleman from Alabama (Mr. Davis).
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. DAVIS of Alabama. Mr. Speaker, on that I demand the yeas and 
nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this motion will be postponed.

                          ____________________