[Congressional Record Volume 151, Number 31 (Tuesday, March 15, 2005)]
[Senate]
[Pages S2755-S2757]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        PERKINS VOCATIONAL AND TECHNICAL EDUCATION ACT AMENDMENT

  Mr. HARKIN. Mr. President, I have an amendment that I just sent to 
the desk. It is pending. I will not call it up now or ask unanimous 
consent, but I will do so at some point, probably tomorrow. I want to 
take this time to at least lay out the reasons for this amendment and 
what it does, because I know what the crunch will be like tomorrow when 
we come back here.
  The budget resolution for fiscal year 2006 basically eliminates 
funding for an enormously effective and popular education program 
called the Perkins Vocational and Technical Education Act. The 
straightforward purposes of my amendment, which I will offer for 
myself, Senator Durbin, Senator Murray, and others, are, first, to 
restore funding to the Perkins Vocational Education Act; second, to 
reduce the deficit; and, third, to offset the costs by rescinding two 
tax-cut provisions in the 2001 tax bill.
  These tax-cut provisions, the so-called PEP and Pease phaseout 
provisions, are scheduled to start taking effect next year for the 
first time.
  President Kennedy used to say that to govern is to choose. Right now 
the budget resolution chooses very unwisely. It eliminates funding for 
a critical education program, vocational education, while allowing to 
stand two new tax cuts. While these two new tax cuts cost $23 billion 
in the first 5 years, after that the costs explode. They will cost at 
least $146 billion in lost revenue in the coming decade, with 97 
percent of the benefits going to those earning at least $200,000 a 
year.
  This is the wrong choice. The budget resolution does not reflect the 
priorities of the American people. Overall, the budget resolution would 
cut funding for education, the first cut in education funding in 10 
years. It underfunds the President's No Child Left Behind Act by $12 
billion. It leaves behind nearly 3 million children who could be fully 
funded and fully served if title I were funded at the authorized level. 
And, as I said, it eliminates all the funding for the Perkins 
Vocational Education Act.
  This is one I am particularly concerned about. It is a program that 
was just reauthorized in the Senate on a bipartisan basis by a vote of 
99 to 0. The Perkins Act makes possible a broad range of vocational and 
technical education programs for millions of young people and adults. 
It is a true lifeline for students at risk of dropping out of school.
  For millions of these at-risk students, vocational education programs 
are relevant, and they are meaningful. They give kids a reason to stick 
it out until graduation, maybe to go on to a community college, and 
they lead to good, solid jobs.
  In Iowa alone, elimination of the Perkins Vocational Education 
Program would impact 93,000 high school students and more than 37,000 
community college students. The impact nationwide would be a disaster 
for millions of students.
  We are eliminating the Perkins Vocational Education Program for two 
new tax cuts? Overwhelmingly for the most affluent? This makes no 
sense. In fact, it borders on the obscene.
  Our friends on the other side might claim the budget resolution does 
not expressly eliminate the vocational education program, but the 
reality is this budget resolution effectively endorses the budget 
proposed by President Bush, and President Bush endorsed eliminating the 
Perkins program.
  So there are only two ways to retain funding for vocational education 
under this budget resolution: either cut other educational programs or 
increase the overall allocation for education.
  This chart here shows what I mean. Right here basically you have a 
puzzle. We put it all together. This is education. We have title I, we 
have afterschool centers, we have special ed, bilingual ed, impact aid, 
Pell grants--all the things that make up our education plan.
  What is left out? Vocational education, ed tech, TRIO, Safe and Drug-
free Schools, arts education. These are left out.
  Someone on the Budget Committee might say, we didn't say that voc ed 
couldn't be funded, but here are all the things we fund. If you want to 
put voc ed back into the puzzle, what do you take out? Because, you 
see, this is the limit. We only have this much money. If you put voc ed 
in, do we take the money away from title I or do we take it away from 
Pell grants? How about special ed; do we take money away from special 
ed to put it back in? Or do we make the square bigger and then put it 
in, so we don't take anything away from the educational programs that 
are already there.
  That is exactly what my amendment accomplishes. We add more overall 
funding to the educational budget. How do we do this? Where do we get 
the money? My amendment offsets the cost of restoring the Perkins 
program. It also reduces the deficit by rescinding two tax cuts that 
have not even taken effect yet. Both of these tax cuts, the so-called 
PEP and Pease provisions, were enacted in 2001 and they start next 
year.
  We have a unique opportunity. We are not proposing to repeal or undo 
a tax cut that is already in effect. Rather, we are saying that because 
of radically transformed budgetary circumstances--that is the huge debt 
we are in, the deficits we are running up--we are not going to go 
forward with two new tax cuts that haven't even taken effect yet, two 
new tax cuts we can no longer afford.
  When PEP and Pease were put in in 2000, the argument was made that we 
had all of these budget surpluses that were left over from President 
Clinton, and we could afford it. That was then and this is now.
  Because of the surge in Federal spending, because of the deficits 
since President Bush has taken office, the surpluses left by President 
Clinton are gone. Instead, we are looking at projected deficits in 
excess of $200 billion a year, and annual deficits in excess of $500 
billion a year decades from now, unless we straighten out our house.
  It makes good sense to stop these two new tax cuts from going into 
effect next year--$146 billion that this will cost us over 10 years.

[[Page S2756]]

  Who gets the gravy? Here it is right here. Under PEP and Pease, the 
tax cuts that start next year, for those making over $1 million, when 
they are phased in, $19,234 a year; $500,000 to $1 million, $4,000 a 
year; under $75,000 a year, you get nothing, zero.
  In fact, if these two new tax cuts go into effect next year, 97 
percent of all the benefits will go to people making over $200,000 a 
year. Fifty-four percent will go to people making over $1 million a 
year. We can't afford these tax cuts.
  There are two things we can't afford. We can't afford these tax cuts, 
and we can't afford to underfund and to eliminate the Perkins 
vocational education bill.
  We now have a unique opportunity to rescind these tax cuts before 
they even go into effect.
  The Perkins program is a lifeline to low-income Americans struggling 
to obtain job skills, the essential rung on the ladder of opportunity.
  I also refer to this editorial that was in the Washington Post, 
February 22, last month. ``PEP, Pease, Presidents.''
  I will refer to this. It says:

       The cuts would repeal two provisions enacted as part of the 
     first President Bush's deficit reduction plan. The 
     provisions--known as PEP, for Personal Exemption Phaseout, 
     and Pease, for its author, the late Rep. Donald J. Pease of 
     Ohio--essentially make more income of wealthy Americans 
     subject to taxation.

  As they said:

       Given the deficits that have piled up on his watch, and the 
     growing costs of war in Iraq, it makes sense to ask: Why does 
     President Bush think this tax break is necessary?

  It is not necessary. It hasn't even started yet. I will lay 10 to 1 
that not one Senator in this Senate on either side of the aisle has 
ever been contacted by someone making over $200,000 a year who says we 
have to have it. Nonsense.
  My amendment basically says we are not repealing these, we are just 
saying these two tax cuts won't go into effect next year. We will save 
a lot of money. We will put that money into deficit reduction, and we 
will put the money into restoring Perkins funding.
  We just recently voted 99 to 0 to reauthorize the Perkins program. 
Every Senator said, yes, we need vocational education. The President 
sends his budget out and says get rid of the whole thing. And this 
budget has the same money figures in it for education that the 
President wants.
  Now is our opportunity. We can vote to not let these tax cuts go into 
effect. We can do two good things: Reduce the deficit and make sure we 
continue with vocational education in this country.
  I ask unanimous consent to have printed in the Record a copy of the 
Washington Post editorial.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

               [From the Washington Post, Feb. 22, 2005]

                         PEP, Pease, Presidents

       Here's a modest tax proposal for President Bush: Cancel two 
     tax-cut provisions that haven't yet taken effect. These tax 
     cuts weren't part of Mr. Bush's original tax proposal but 
     were inserted into his 2001 tax package. They begin to phase 
     in next year unless Congress acts. And 97 percent of the cuts 
     will go to the 4 percent of U.S. households with incomes 
     greater than $200,000; more than half to the 0.2 percent of 
     households with annual incomes of more than $1 million. 
     During the first 10 years they are fully in effect, they will 
     reduce government tax revenue by close to $200 billion, 
     including interest, and possibly much more it, as the 
     administation has promised, there are adjustments to the 
     alternative minimum tax (which would otherwise recapture some 
     of taxpayers' savings from these breaks).
       The cuts would repeal two provisions enacted as part of the 
     first President Bush's deficit reduction plan. The 
     provisions--known as PEP, for Personal Exemption Phaseout, 
     and Pease, for its author, the late Rep. Donald J. Pease (D-
     Ohio)--essentially make more income of wealthy Americans 
     subject to taxation. In a perfect tax world, PEP and Pease 
     would be abolished. They are complex and at times unfair (for 
     example, PEP penalizes those with larger families). PEP and 
     Pease would be great candidates for change in the broader tax 
     overhaul Mr. Bush is planning.
       But of all the complicated tax provisions in the most 
     complicated tax code in the developed world, why repeal these 
     two? After all, even if PEP and Pease were untouched, 
     wealthier taxpayers would reap big benefits from the 
     remaining tax cuts. For example, in 2010, when the repeal is 
     to be fully effective, households with incomes of more than 
     $1 million will get tax cuts averaging $108,000 from other 
     tax provisions adopted in 2001 and 2003, according to 
     calculations by the Tax Policy Center. With the effect of 
     estate tax repeal, this group will reap average cuts of 
     $133,000. Getting rid of PEP and Pease brings that total to 
     $152,000.
       Given the deficits that have piled up on his watch, and the 
     growing costs of war in Iraq, it makes sense to ask: Why does 
     President Bush think this tax break is necessary?
  To reiterate, Mr. President, President Kennedy used to say that ``to 
govern is to choose.'' Right now, the budget resolution chooses very 
unwisely. It eliminates funding for a critical education program: the 
Perkins act, while allowing to stand two new tax cuts worth. While 
these two new tax cuts cost $23 billion in the coming 5 years, the 
costs explode after that. They will cost at least $146 billion in the 
coming decade--with 97 percent of the benefits going to those earning 
at least $200,000 a year.
  This is the wrong choice. The budget resolution does not reflect the 
priorities of the American people. In fact, it doesn't reflect what 
President Bush says are among his top priorities. Overall, the budget 
resolution would cut funding for education--the first cut in education 
funding in 10 years. It underfunds the President's No Child Left Behind 
Act by $12 billion. It leaves behind nearly 3 million children who 
could be fully served by Title I if the program were funded at the 
authorized level. It underfunds special education by $3.6 billion--just 
3 months after the President signed a new IDEA reauthorization law. And 
it eliminates all funding for vocational education, school counselors, 
education technology, safe and drug-free schools, and 44 other 
education programs totaling over $4 billion.
  I am particularly concerned that the budget resolution totally 
eliminates funding for the Perkins vocational education program--a 
program that was just reauthorized in the Senate on a bipartisan basis.
  The Perkins Act makes possible a broad range of vocational and 
technical education programs for millions of young people and adults. 
Vocational education combines classroom instruction, hands-on-
laboratory work, and on-the-job training. This is a true lifeline for 
students at risk of dropping out of school.
  For millions of these at-risk students, vocational education programs 
are relevant. They are meaningful. They give kids a reason to stick it 
out until graduation and perhaps go on to community college. And they 
lead to good, solid jobs after graduation.
  Just last week, I met with high school and community college students 
from Iowa who have benefited from Perkins funding. They are truly an 
inspiration--and I hate to think of their fate if they had not been 
given the option of vocational and technical education. But that is 
exactly what will happen if the budget resolution is not changed. In 
Iowa alone, elimination of the Perkins Vocational Education program 
would directly impact 93,000 high school students and more than 37,000 
community college students. The impact nationwide would be a disaster 
for many millions of students.
  And we are eliminating this program to make room for two new tax 
cuts, overwhelmingly for the most affluent? This makes no sense. In 
fact, it borders on the obscene.
  Our friends on the other side of the aisle claim that the budget 
resolution doesn't expressly eliminate the vocational education 
program. That is too clever by half. The reality is that the budget 
resolution effectively endorses the budget proposed by President Bush--
and that means it endorses the elimination of Perkins funding.
  There are only two ways to retain funding for vocational education 
under this budget resolution: By cutting other education programs 
instead . . . or by increasing the overall allocation for education.
  This chart shows what I mean. The puzzle represents the Republican 
budget resolution. Unfortunately, there are a lot of pieces that don't 
fit. There's no room in the budget resolution for vocational education, 
technical education, TRIO, and many other programs. The only way to 
include funding for vocational education is to take out a different 
piece of the puzzle. So what pieces do the Republicans propose to take 
out in lieu of vocational education? Do they want to cut Title I? Pell 
Grants? Special education?
  The truth is that the only way we can be assured of saving Perkins 
funding is by adding more overall funding

[[Page S2757]]

to the education budget for that purpose. And that is exactly what my 
amendment accomplishes.
  As I said, my amendment offsets the cost of restoring Perkins--and it 
reduces the deficit, as well--by rescinding two tax cuts that have not 
yet taken effect. Both of these tax cuts--the so-called PEP and Pease 
provisions--were enacted in 2001. One of these tax measures repeals the 
law enacted in 1990 that scales back the magnitude of itemized 
deductions that high-income taxpayers can take. The second tax-cut 
measure repeals another provision enacted in 1990, under which the 
personal exemption is phased out for households with very high incomes. 
Under the 2001 tax cut legislation, these two current provisions of law 
begin to be phased out next year, and are eliminated entirely in 2010.

  We have a unique opportunity, here, because we are not proposing to 
repeal or un-do tax cuts that are already in effect. Rather, we are 
saying that--because of radically transformed budgetary circumstances--
we are not going to go forward with two new tax cuts that have not yet 
taken effect. . . two new tax cuts that we can no longer afford.
  When the PEP and Pease phase-out provisions were passed in 2001, a 
case could be made--I disagreed, but certainly a case could be made--
that these tax cuts were affordable. Thanks to the budget surpluses 
that President Bush inherited from President Clinton, we were looking 
at cumulative surpluses of $5 trillion over the coming decade, enough 
to eliminate the national debt, and then some. The chairman of the 
Federal Reserve Board, Alan Greenspan, publicly worried about the 
impending surplus crisis--What in the world would we do with all these 
surpluses after we eliminated the national debt? Moreover, President 
Bush and other advocates of the 2001 tax cuts assured us that they 
would total no more than $1.35 trillion between 2001 and 2010.
  Well that was then, and this is now. The tax cuts that were supposed 
to cost $1.35 trillion are now projected to cost more than $2 trillion 
in the decade after 2010. And because of the surge in federal spending 
since President Bush took office--including the creation of a huge new 
entitlement program--the surpluses bequeathed by President Clinton are 
gone. Instead, we are looking at projected deficits in excess of $200 
billion each year as far as the eye can see--and annual deficits in 
excess of $500 billion a year a decade from now if we follow the 
President's recommendations.
  It makes good sense to eliminate these two tax cuts. The fact is, 
they are a ticking timebomb scheduled to detonate after 2010--a 
detonation that will further explode the deficits and debt. The revenue 
loss because of the PEP and Pease phase-outs would be a relatively 
modest $24 billion over the first 5 years. But the revenue loss 
explodes in the years after that. In the first 10 years after full 
implementation, the revenue loss will be a whopping $146 billion.
  And who gets these tax cuts? According to the Tax Policy Center of 
the Urban Institute and the Brookings Institution, 54 percent of the 
benefits go to households earning more than $1 million a year. Fully 97 
percent of benefits go to households making more than $200,000 per 
year.
  What does that mean for a taxpayer? When the phase out is fully 
phased in by 2010, the tax cut will save the average taxpayer making 
over $1 million nearly $20,000 per year.
  But almost no taxpayers making less than $150,000 will receive even a 
penny of tax cuts under these provisions.
  These are two tax cuts that we cannot afford. They are two tax cuts 
that their beneficiaries do not need.
  The deficits and debt are exploding because of actions by the 
President and Congress. To quote the cartoon character Pogo: ``We have 
met the enemy, and he is us.'' But we now have this unique opportunity 
to rescind two unnecessary and unaffordable tax cuts before they take 
effect.
  Such a modest mid-course correction is exactly what President Ronald 
Reagan did in 1982. He realized that his 1981 tax cuts had overshot, 
and that they were projected to cause the kind of monster deficits we 
are experiencing today. President Reagan did the prudent and 
responsible thing: he pared back some of his tax cuts. Today, we need 
to show that same kind of restraint by not allowing the PEP and Pease 
provisions to go forward.
  The difference, or course, is that President Reagan repealed tax cuts 
that had already taken effect. What we are proposing, today, is simply 
to not allow two new tax cuts to go forward--tax cuts that haven't yet 
taken effect.
  The Perkins program is a lifeline to low-income Americans struggling 
to obtain marketable job skills. It is an essential rung on the ladder 
of opportunity that we extend to our young people.
  So I come back to President Kennedy's remark that ``to govern is to 
choose.'' We can't have it all. We must choose. And today we are 
confronted with this choice. We can go forward with these two new tax 
cuts, overwhelmingly for people who don't need them, while eliminating 
Perkins funding for vocational education. Or we can say, ``Two trillion 
dollars in tax cuts, mostly for the affluent, is surely enough. Let's 
rescind these two new tax cuts before they go into effect. And let's 
redirect that money to education. . . to giving millions of young 
Americans the vocational skills they need to succeed in the global 
economy.''
  Certainly, all who favor creating an opportunity society should be in 
favor of this amendment. So should all who believe in basic fairness 
and equity.
  Indeed, if all the millionaires who stand to benefit from these two 
new tax cuts were here in this chamber, today, and voting on this 
amendment, there is no doubt in my mind that the vast majority of them 
would vote ``yes.'' They would say, ``We have already made it. America 
has already blessed us with wealth and comfort. By all means, withhold 
these latest tax cuts, and redirect that money to vocational education 
students so they can graduate, so they can have opportunity, so they 
can achieve the American dream as we did.''
  Let's restore Perkins funding and let's reduce the deficit. I urge my 
colleagues to join me in a resounding, bipartisan vote on this 
amendment. We voted 99-0 to reauthorize the Perkins program. Now let's 
vote to keep this proven, effective program alive and thriving for 
millions of students across America.
  I will close by saying I hope we will get this amendment up for a 
vote tomorrow so Senators can express themselves on it.
  I yield the floor.

                          ____________________