[Congressional Record Volume 151, Number 157 (Thursday, December 8, 2005)]
[House]
[Pages H11227-H11264]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PROVIDING FOR CONSIDERATION OF H.R. 4297, TAX RELIEF EXTENSION
RECONCILIATION ACT OF 2005
Mr. PUTNAM. Mr. Speaker, by direction of the Committee on Rules, I
call up House Resolution 588 and ask for its immediate consideration.
The Clerk read the resolution, as follows:
H. Res. 588
Resolved, That upon the adoption of this resolution it
shall be in order without intervention of any point of order
to consider in the House the bill (H.R. 4297) to provide for
reconciliation pursuant to section 201(b) of the concurrent
resolution on the budget for fiscal year 2006. The bill shall
be considered as read. The amendment in the nature of a
substitute recommended by the Committee on Ways and Means now
printed in the bill shall be considered as adopted. The
previous question shall be considered as ordered on the bill,
as amended, to final passage without intervening motion
except: (1) one hour of debate on the bill, as amended,
equally divided and controlled by the chairman and ranking
minority member of the Committee on Ways and Means; (2) the
amendment in the nature of a substitute printed in the report
of the Committee on Rules accompanying this resolution, if
offered by Representative Rangel of New York or his designee,
which shall be in order without intervention of any point of
order, shall be considered as read, and shall be separately
debatable for one hour equally divided and controlled by the
proponent and an opponent; and (3) one motion to recommit
with or without instructions.
{time} 1030
The SPEAKER pro tempore (Mr. LaHood). The gentleman from Florida (Mr.
Putnam) is recognized for 1 hour.
Mr. PUTNAM. Mr. Speaker, for the purpose of debate only, I yield the
customary 30 minutes to the gentlewoman from Rochester, New York (Ms.
Slaughter), pending which I yield myself such time as I may consume.
During consideration of this resolution, all time yielded is for the
purpose of debate only.
(Mr. PUTNAM asked and was given permission to revise and extend his
remarks.)
Mr. PUTNAM. Mr. Speaker, in April Congress passed a responsible
budget that called for spending restraint, reduction of the deficit;
and by slowing the unsustainable and automatic growth of mandatory
spending programs and extending tax relief to families and small
businesses, we have successfully accomplished the first two. Now, this
rule will provide for consideration of our final commitment to American
taxpayers, extending numerous important tax relief provisions.
In 2001, 2003 and 2004, Congress enacted responsible tax relief to
help create new jobs, grow America's economy, and put more money in the
hands of workers, families, small businesses, farms, and ranches.
Following this tax relief, unemployment dropped a full percentage point
to 5 percent, and we have experienced 10 uninterrupted quarters of real
growth in our economy, above 3 percent, the longest stretch since the
1980s. As was proven by the tax cuts during the Kennedy and Reagan
administrations, Federal revenues actually increase after taxes are
lowered.
Our expanding economy is led by consumer spending, job growth, and
business investment. This is a result of allowing workers to keep more
of their hard-earned money, decreasing the tax burden on small
businesses so they can expand and hire more workers, and providing
incentives for families to save and invest.
Unless we take action today, many of the important tax provisions
that have helped our economy grow strong will expire. Without passage
of this legislation, workers, families, and small businesses will have
less of their paycheck to take home each week.
Mr. Speaker, H.R. 4297, the Tax Relief Extension Reconciliation Act,
not the most eloquent of names but an important one, will continue to
build on the economic progress we have already made.
A key part of the American Jobs Creation Act of 2004 was a return to
fairness for those who live, work, and raise families in States with no
State income tax. The State and local sales tax deduction is
particularly important to those in my home State of Florida and nine
other States because it gives every taxpayer the opportunity to deduct
State sales tax from his Federal tax bill, something that other higher-
tax States have enjoyed for some time. This provision is set to expire
in 3 weeks. While I will continue to work to make the State and local
sales tax deduction permanent, this bill extends the provision for an
additional year, which is an important step forward for fairness.
The bill also extends several tax incentives to enhance the
affordability of higher education, including tax-deferred education
savings accounts and tax credits for post-secondary education. It
allows all taxpayers to deduct up to $4,000 of higher education
expenses, which will help more students go to college.
For teachers, the tax bill extends an important above-the-line
deduction to help them contain the costs of out-of-pocket classroom
expenses such as books, supplies, and computer equipment. We all know
that our hardworking educators are covering for some of our neediest
students, and this bill lets them keep the tax deductibility of their
generosity.
In an effort to encourage savings and stable retirement security,
this tax bill allows lower-income families that contribute to
individual retirement accounts and pension plans to continue receiving
a Federal match in the form of an income tax credit for the first
$2,000 of annual contributions. This encourages families to save and
plan for their own retirement. While we were unable as a body to settle
on a Social Security reform plan, surely we can all agree that
encouraging low-income families to save for retirement and giving them
the tools to do so is a sound economic policy.
Our bill freezes the rate on capital gains and dividends and prevents
an increase of the tax burden on 24 million families. It is imperative
that we extend this tax relief so our economy will continue on its
upward track.
New data released at the start of December show that our economy
continues to strengthen and grow. The Labor Department reported that
employers added 215,000 jobs in November, after adding 44,000 in
October and 17,000 in September in the wake of devastating hurricanes.
The jobless rate remains unchanged at 5 percent. The economy grew at
an annual rate of 4.3 percent in the third quarter, much stronger than
expected.
Forecasters' outlooks for coming months are upbeat as well.
November's increase in payroll, the largest since July, was broad-
based. Construction employment rose by 37,000. Employment in
professional and technical services rose by 22,000. Health care
employment rose by 20,000 jobs. Manufacturers added 11,000 jobs last
month following an increase of 15,000 in October.
The most recent Commerce Department report shows overall consumer
spending increased at a 4.2 percent annual rate, exceeding
expectations. Purchases of nondurable goods surged 3.6 percent,
exceeding expectations. Housing spending came in at 8.4 percent.
Business investment spending rose at 8.8 percent, exceeding
expectations.
Obviously, the current tax policy of this Congress has encouraged
economic growth, and to raise taxes now would close the door of
opportunity that is open for so many today.
Mr. Speaker, this rule provides for consideration of a substitute
bill.
[[Page H11228]]
While we often hear Democrats decry tax relief, they have decided to
offer a substitute that extends many of the same tax provisions as this
underlying bill does, but let us look at who they left out.
The Democratic substitute does not extend an income tax credit for
low-income families who contribute to individual retirement accounts,
IRAs, and pension plans. This hurts low-income families who are
struggling to save for retirement, people who are doing the right
things to prepare for their future rather than solely depending on the
government to do it for them.
The Democratic substitute does not extend enhanced small business
depreciation expensing, so it increases taxes on small businesses, the
very engines of innovation and growth and employment in this country.
The Democratic substitute does not include an extension of the
reduced rates on capital gains and dividends. Without this extension,
24 million families will see a tax increase, including 7 million
seniors who have benefited an average of $1,200 annually from that
change. At a time when concern is growing about foreign investment in
the United States, the Democratic substitute throws up barriers to
Americans investing in America.
The Democratic substitute does include a tax increase on families and
small businesses to pay for the bill. Many of these individuals are
small businesses who do much of the hiring and buying in this economy.
The Democratic substitute bill leaves behind small businesses, omits
low-income savers, and hurts families and seniors. At a time when home
heating bills are rising and local property taxes are growing, why
would the Democratic substitute take even more from the wallets and
purses and piggy banks of the American taxpayer?
Mr. Speaker, the Republican tax reforms of 2001, 2003 and 2004 have
created jobs, strengthened our economy, and increased Federal revenues
in the process. They quantifiably aided in shortening and curtailing
the severity of the recession of 2000 and 2001. They buoyed the economy
through major terrorist attacks, devastating natural disasters, and a
global war on terrorism. Now is not the time to increase taxes on the
American people. Failure to pass this bill would result in higher taxes
on seniors, savers, small businesses, and farmers. We must continue the
policies that grow our economy and keep our tax bills from rising.
I urge my colleagues to support this resolution and the underlying
bill, the Tax Relief Extension Reconciliation Act.
Mr. Speaker, I reserve the balance of my time.
Ms. SLAUGHTER. Mr. Speaker, I yield myself such time as I may
consume.
(Ms. SLAUGHTER asked and was given permission to revise and extend
her remarks.)
Ms. SLAUGHTER. Mr. Speaker, just 2 weeks ago, the majority forced a
budget vote by two votes to cut $50 billion from education, from health
care, from foster care, child support, and a host of other vital
programs. They claimed that they were simply eliminating waste and
promoting fiscal responsibility and, most importantly, curbing our
national debt.
But today, they want us to agree to a tax cut for $56 billion. If we
take away the $50 billion in the budget tax cuts, but we add $56
billion in tax giveaways, we end up with more debt, not less. In fact,
we end up adding $6 billion to the largest deficit in our country's
history, the one created by this Republican Congress.
Now, if reducing the deficit is not a priority, what has made the
majority's agenda? How we control the purse strings in our hands
reveals who we work for. Of the proposed $56 billion in cuts, 50
percent, that is, $28 billion, will go to the superrich, those among us
who need it the least. This bill is for them, the men and women among
us who earn more than $1 million a year, a mere fraction of 1 percent
of Americans.
At the same time, the middle class will continue to be squeezed,
while workers who make $40,000 or less, in other words, those who need
help the most, will receive 1 percent of today's cuts.
That is what this is about. Does the Republican Party really think
the American people do not see what is going on here?
What this bill shows us today is that Republicans care about
entrenching privilege, the work of a corrupt and inefficient
government, all while talking about tough choices and cutting
government waste; but their rhetoric does not add up.
If they were serious about making government work better, they would
fulfill their responsibility to conduct proper congressional oversight
and ensure that the money we do spend is spent efficiently.
They would look for the $9 billion misplaced during Iraq
reconstruction, and we have tried time and time again to have
amendments approved that would do just that. Now, the loss of $9
billion in Iraq is what I call government waste, but there is not a
court in this country which could find Republicans guilty of enforcing
accountability in government. There would not be the evidence to
convict them. Instead, they cut social services for the needy and send
the savings to the rich.
Have tax cuts for the rich become the sole agenda of the majority
party? Sadly, in the face of numerous challenges from both abroad and
home, this increasingly seems to be the case.
Their solution to rehabilitating the lives of those devastated by
natural disasters? Cut taxes for the rich. Their solution to curbing an
out-of-control national debt? Cut taxes for the rich.
My friends on the other side of the aisle talk about the agenda of
reform, but they have controlled the Congress for over 10 years, and
now they are the status quo. As much as they may want to say they are
the solution, we know that they have become the problem.
If they were committed to solutions, they would not funnel money to
the rich while they leave the working middle class to fend for
themselves, all while cutting education and health care programs and
adding billions to the massive debt that is crushing this Nation. Let
me point out that the 400,000 persons who lost their food stamps in the
budget cuts and over 300,000 children who lost their breakfast
programs, that money is being used today to finance these tax cuts.
The pursuit of such an agenda violates the trust our constituents
have invested in their elected representatives, and it is an abdication
of the most fundamental responsibilities of this Congress.
America can be better than this. We can do better than selling out
the vast majority of our citizens so that Congress can give another tax
cut to a tiny minority. We can do better than increasing our staggering
national debt and calling it fiscal responsibility.
This leadership has forgotten what made America great. It has
forgotten what made the 20th century the American century, which was
investment in the middle class, investment in society, investment in
education, investment in opportunity, investment in the future, not
investment in the rich.
It is time for a new direction. Together, America can do better than
what this leadership is proposing here today.
I urge my colleagues to defeat this bill and defeat this rule.
Mr. Speaker, I reserve the balance of my time.
Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the gentleman from
Georgia (Mr. Gingrey).
Mr. GINGREY. Mr. Speaker, I would like to thank my friend and
colleague on the Rules Committee for allowing me this opportunity to
speak on behalf of this rule and the underlying bill, H.R. 4297, the
Tax Relief Extension Reconciliation Act.
Today, each and every Member of this House is taking a test before
the American people. This test has one question, and simply enough, it
is even multiple choice. The question is: Who do you trust more to
spend your hard-earned money? Is it, A, the Federal Government and its
bloated bureaucracy; or is it, B, the American people? Well, Mr.
Speaker, the correct answer, obviously, is, B, the American people.
{time} 1045
However, those who vote against this rule and vote against this tax
relief bill are choosing to trust the Federal Government and its
bloated bureaucracy over the people who pay the taxes and are the
engine of a job-creating economy.
Now, Mr. Speaker, the opponents of this tax relief will try to
obscure and
[[Page H11229]]
confuse this debate by mischaracterizing this House's previous vote on
budget reform and reduction with claims of, and I have already heard
it, robbing the poor to pay the rich. Well, Mr. Speaker, these claims
are simply untrue.
In fact, today's reconciliation package includes extensions of tax
incentives that provide work for many low-income Americans, such as the
Welfare to Work Tax Credit and the Work Opportunity Tax Credit that
encourages businesses to hire and pay people and families on public
assistance, high-risk youths, qualified veterans, and people who
receive food stamps.
So a vote against this tax relief package is tantamount to a vote for
an economy under which it is acceptable and even preferred to give the
poorest individuals only one option, government dependency, a
dependency that empowers bureaucrats and politicians over people and
places political power before economic liberty and opportunity.
Mr. Speaker, I would also like to add that since this tax relief
package includes mostly extensions of current tax cuts and credits, a
vote against this bill is a vote simply to raise taxes. No ifs, ands,
or buts, those who vote against this bill are voting in front of the
American people to raise taxes. The opponents of this bill would raise
taxes on middle-income Americans, rich Americans, poor Americans,
investors, savers, entrepreneurs, small business owners, universities,
veterans, and even people who are trying to clean up the environment.
All of these people will receive a tax increase if this bill is not
passed and signed into law.
So, Mr. Speaker, each and every Member of this House has an
opportunity today to go on record and tell the American people where
they stand on raising taxes and whether they trust the American people
with their own money.
In conclusion, I would like to encourage my colleagues to support
this rule and the underlying tax relief extension package for the sake
of economic growth and for the sake of the American taxpayer.
Ms. SLAUGHTER. Mr. Speaker, I am pleased to yield 4 minutes to the
gentleman from Oregon (Mr. DeFazio).
Mr. DeFAZIO. It is extraordinary. If you assert something that is not
true, it is true on the floor of the House. There is no truth test
here. Cut taxes for the rich, it will stimulate the economy. Put the
little people to work who will pay taxes for their job cutting the
lawns or washing their yachts. That is the argument we are hearing from
that side of the aisle. Trickle down economics works, they tell us.
Unfortunately, that is not what most Americans find with their real
incomes stalled out over the last 5 years. No, trickle down economics
does one simple thing: It rewards the benefactors of the Republican
Party.
Let us just look at one of the elements of the ``not raising taxes
today.'' It would be let the tax cuts in dividends on stocks. Now, I go
to my town meetings and I say, everybody who has dividend paying
stocks, raise your hand. And I have a lot of people coming to my town
meetings, but usually it is one, maybe two. And I think that is pretty
much the same across America. But the millionaires and, yeah, the
billionaires, they have a lot of dividend paying stocks. In fact, their
tax cuts average $127,000, while the average family averaged $800.
Now, that is not even talking about the dividend tax. Let us talk
about the dividend tax. This bill will extend the cut in dividend
taxes. Now, the American Enterprise Institute, no liberal bastion
there, they just issued a report and it says the dividend tax break has
not generated more business investment or jobs or productive economic
activity but it has enhanced investor wealth. That is what this is
about. This bill is to enhance investor wealth.
Now, they have a newfound concern about the sea of red ink they have
created, the 60 percent increase in our debt in the last 5 years. So a
couple of weeks ago we jammed through a bill at 2 a.m. in the morning
that cut things like student financial aid, Medicaid, health care to
poor people, dumping that burden on the States; foster care, long-term
care, the school lunch program. Those little kids are just eating too
much. They are chowing down. They are going to help the obesity problem
on this side of the aisle by starving kids.
Now, what are we buying with those cuts? Well, the student loan cuts,
they say, oh, we are not cutting student loans, we are just charging
them more for the loans. Right, you are not cutting student loans, you
are just increasing their debt burden. You are not cutting the loans,
you are just jacking up the interest rate, charging them twice as much
to take out a loan, and charging them a special new fee to get a very
high fixed interest rate, something they can get now for free at a
lower rate.
But they are not whacking the students too hard, only $14 billion.
And what do we get for that $14 billion? An extension of the dividend
tax cut. That is great. So now the wealthy will be able to buy more
yachts to float on the sea of red ink that the Republicans have
created. They will be able to hire more help around the mansion. That
is trickle down economics.
They talk about how great the economy is doing. Here is a few facts.
Unemployment rate, yes, it is recently down, but it is up eight-tenths
of a percent over when the Republican administration took charge. There
is 1.6 million more unemployed workers than when George Bush took
office. There is the slowest private sector job growth of any
administration since Herbert Hoover. He is doing better than Herbert
Hoover. That is great. The largest projected surpluses turned into the
largest projected deficits, with $4.2 trillion more debt in 2008.
Now, that is the grand success of trickle down. And they come out
here and assert baldly that giving tax cuts to rich people will not
only stimulate the economy, put people to work, but that it will reduce
the deficit. Sure. You really believe that? I do not think so. The
American people do not believe it.
What you are doing here is giving very generous tax cuts to the
people who give you very generous campaign contributions.
Mr. PUTNAM. Mr. Speaker, I am pleased to yield such time as he may
consume to the gentleman from California (Mr. Dreier), the
distinguished chairman of the Rules Committee.
(Mr. DREIER asked and was given permission to revise and extend his
remarks.)
Mr. DREIER. Mr. Speaker, I rise in strong support of this rule, and I
thank and congratulate my great friend from Florida, such a hardworking
member of the Rules Committee, and I thank all those involved in this
effort, which I hope at the end of the day will be bipartisan. Because
we all know that of that proverbial saying that everyone is entitled to
their own opinion but not their own facts.
As I listened to the pathetic, and that is really the only way you
can describe it, the pathetic old class warfare, us versus them
argument, cleaning yachts and mowing lawns and all this stuff. The
facts are 56.9 million American families, 56.9 million American
families, nearly 60 percent of American families are members of the
investor class. The investor class, people who have some kind of
investment. And, Mr. Speaker, 30 percent, 30 percent of the members of
the investor class earn less than $50,000 a year. Now, those are the
ultra rich we continue to hear about who might benefit from job
creations.
I will tell you that if you look at the arguments that were made, and
I listened to my good friend from Rochester, Ms. Slaughter, in her
opening statement in which she talked about investing in all these
important things, of course we all want to invest in the future. But
she said, do not invest in the rich. Well, the fact of the matter is we
are encouraging investment with this because we want to do everything
we possibly can to make sure that those people who are out there
creating jobs have the incentive to do that.
And we also need to look at long-term planning. People can stand up
and malign the dividend cuts and the capital gains cuts, but I actually
believe we should have no tax on capital gains at all. It is a double
tax and, frankly, it discourages growth.
I will never forget a few years ago visiting New Zealand, which is
certainly a left of center government. The prime minister there, Prime
Minister Clark, well, let us just say she is not what you would call
center right. But I met with a number of people in New Zealand, and I
raised with them the
[[Page H11230]]
prospect of establishing a capital gains. They have zero capital gains
there. They said that they did a study in New Zealand and found that
the mere establishment of a capital gains tax would be devastating to
the economy of New Zealand. And all we are saying is we should allow
people for another couple of years to plan at a 15 percent capital
gains rate.
Mr. Speaker, we know, as we look at the arguments that were provided
in 2001, 2002, 2003, that our wonderful colleagues on the other side of
the aisle regularly said the following things: Number one, if you put
into place these tax cuts, the economy is going to head straight into
the tank.
And I listened to my friend from Oregon go through the Herbert Hoover
argument, and I thought we had sort of beaten that one back in the 2004
campaign when in the last 3 years we have seen the creation of 4\1/2\
million jobs under the payroll survey guideline and 5 million jobs
under the household survey guideline. I thought we had pretty much
beaten that argument back, but obviously, they are continuing to try
and dredge this up.
They said that if we put into place this tax cut that the economy
would go into the tank and the deficit would go sky high. We know the
exact opposite has been the case. We, in fact, have had a reduction of
$94 billion in the deficit simply because of economic growth, simply
because of the enhanced flow of revenues to come into the Federal
Treasury.
Now, obviously, we are not going to see probably the best improvement
in the deficit number next year because of Hurricane Katrina and other
costs that we have faced, and we are doing everything we can, so many
of us, to try to rein in mandatory spending with the reconciliation
process we have gone through, and to try to do what we can on both
discretionary as well as mandatory, as I said. But the fact of the
matter is, Mr. Speaker, the single most important thing that we can do
to deal with the challenges of investing in all those things that Ms.
Slaughter mentioned, is to make sure that the economy continues to
grow.
I can think of nothing, nothing worse for the potential future growth
of our economy than to not pass this measure. So if you believe in
bringing unemployment down even further, if you believe in seeing the
already record level of minority home ownership go even higher, if you
believe in enhanced productivity and incentives for that, it is
absolutely essential that this rule and this legislation be passed.
So I commend it to my colleagues. The tired old arguments of the past
are not carrying any weight at all with the American people, I am happy
to say. They get it. They understand it. So that is why we should have
Democrats join with Republicans in doing the right thing here.
Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from
Georgia (Mr. Lewis).
Mr. LEWIS of Georgia. Mr. Speaker, I want to thank the gentlewoman
from New York for yielding me this time.
Mr. Speaker, once again, I rise in disbelief about what the House is
about to do today. It is my belief that we are moving down the wrong
road.
Before we left for Thanksgiving, the Republican leadership twisted
arms to pass a bill slashing funding for vital programs that benefit
the neediest Americans. Some might say that the bill was callous. I say
that the bill was immoral. Today, it is still immoral, uncaring, and
without compassion.
But now, to add insult to injury, we have returned to Washington so
that the Republican majority can line the pockets of those at the very
top. That is right, they cut vital programs and services that benefit
hardworking, low- and middle-income Americans, and with the money saved
they are giving more tax cuts to the wealthiest of the wealthy. And in
the process of robbing working families to give to the rich, we are
ballooning the debt, saddling our children and grandchildren with the
bill.
Everybody loses under this bill. Everybody. That is except the top
one-fifth of 1 percent. Some might call them the super rich; apparently
the majority calls them donors.
It is unbelievable. It is unbelievable that we are doing this during
this season. The holy season. It is unreal. This season, of all
seasons, you would think they would not have the audacity, the gall to
pass such a disgraceful and shameful piece of legislation. Oh, but they
do.
Where is our compassion? All of the great religions of the world
speak to the issue of taking care of basic human needs. During this
season, the question must be asked: What would the great teacher do?
What would Jesus do?
We are saying we are people of faith, and yet during this most holy
season we do this? Have we lost our way? How long, but oh, how long
will we continue to take care of those at the very top and not those in
the middle and those at the very bottom? How long, but oh, how long?
This bill is not fair. It is not right. It is not just. As a Nation
and as a people, as a Congress, we can do better. Mr. Speaker, I appeal
to my colleagues to reject this shameful bill.
{time} 1100
Mr. PUTNAM. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
Tennessee (Mr. Duncan).
Mr. DUNCAN. Mr. Speaker, I rise in strong support of this very modest
tax relief proposal and the rule that brings it to the floor, and
especially in support of the deduction for State and local sales taxes
which is so very important to my home State of Tennessee and many
millions of people throughout this Nation.
Every day we read stories about how wasteful the Federal Government
is, and certainly it has been proven over and over again how the least
efficient, most wasteful way to spend money is to turn it over to the
Federal Government. Every dollar we can keep in the private sector
helps to create jobs and lower prices. And who benefits the most from
job creation and lower prices: the poor and the lower-income and the
working people. The wealthy are always going to be all right, but this
is a bill that helps the poor and the lower-income and the working
people more than anybody else.
It contains breaks for the rich like tax deductions for teacher
classroom expenses, expenses that classroom teachers pay out of their
own pockets. It contains another deduction for the rich for deducting
tuition expenses. That is certainly a deduction for the wealthy; and,
of course, I am saying that sarcastically.
It contains expensing for brownfield environmental cleanups,
something that is very good for the environment. It contains breaks for
our veterans and those who have been and are in combat at this time. It
contains increases for small businesses, and certainly that is
something that is very, very important to millions of people throughout
this country.
Mr. Speaker, this is a very modest proposal. I think it is about a 2
percent tax break. I urge passage of this bill.
Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from
Ohio (Mr. Kucinich).
Mr. KUCINICH. Mr. Speaker, I thank the gentlewoman for yielding me
this time.
What the majority is seeking to accomplish here is another transfer
of wealth from the great mass of Americans to a privileged few. This
bill would raise taxes on 17 million American middle-class families by
as much as $640. Millionaires get tax cuts as much as $32,000. People
who bet on the market are going to see their taxes cut or reduced,
while workers are not going to see that kind of relief because this
bill is about a transfer of wealth upwards, a transfer of wealth from
the poor and the middle class to the wealthy. More than half of the
American taxpayers will get less than $30 out of this so-called tax
cut; yet that is what this administration's strategy has been all
about.
There has been no trickle-down benefits from their previous tax cuts
of over a trillion dollars. Americans' savings have disappeared, credit
cards are maxed out, home equity is exhausted, foreclosures have
increased, pension funds are disappearing, health care benefits for
many have been cut or eliminated. There are 45 million Americans
without health insurance. The wealth in this country is being
transferred upward, and as wealth accelerates upward, the quality of
our democracy is deteriorating. This bill continues that trend with
spending cuts suffered by college students, suffered by senior citizens
and children and family farmers.
[[Page H11231]]
My colleague Congressman Lewis asked what would Jesus do. We know his
teachings. He said whatever you do for the least of the brethren, you
do for the Lord. This bill does not do for the least. It does for those
who have the most. There is a transfer of wealth to the great mass of
Americans to a few as a matter of policy here. It is tax cuts, it is
the war, it is all of the spending that is accomplished by our majority
brothers and sisters goes to help those who are wealthy become
wealthier. That is not how you can maintain a democracy.
The tax system is central to making sure that we stay a democracy,
and yet what we see here is the beginning of a plutocracy by continuing
the acceleration of wealth upwards. We need to take stock and
assessment of what these tax policies are doing to undermine people in
this country, of what these tax policies are doing to make it
impossible for a middle class to survive, of what these tax policies
are ignoring in terms of trying to protect America's manufacturers.
There are auto workers and steel workers who are looking for a way for
businesses, their industries, to survive; and instead we are worrying
about accelerating the wealth upward.
We need to take stock of this. This is not only a fiscal question. It
is a moral question, and the arc of our moral fiber here is going to be
determined on whether or not we can stand up to this challenge about
accelerating the wealth upwards.
Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the gentleman from
Texas (Mr. Hensarling).
Mr. HENSARLING. Mr. Speaker, unless we enact H.R. 4297, Americans
will receive a most unwelcomed Christmas gift from the Democrats: a
huge automatic tax increase. This will cost families billions of their
dollars and jeopardize millions of their jobs. We cannot sit idly by
and let the Democrats do this.
Tax relief has already created more than 4.4 million new jobs; but if
you raise taxes, you start taking these jobs away.
Mr. Speaker, let me tell you about a few of the jobs from my east
Texas district that could be lost if the Democrats succeed in their tax
increase plan today. Let me tell you about Hugh Dublin who owns East
Texas Right of Way in Tennessee Colony, Texas. He specializes in the
land-leasing business. Due to tax relief, his company has grown from
two full-time employees to four full-time employees and four part-
timers. His two new full-time employees are named Dan and David. They
were unemployed, but now they are able to start new careers in a
growing business.
The Democrats want to raise taxes on Hugh Dublin and his small
business. They want to jeopardize Dan's and David's paychecks and
replace them with welfare checks, and they call that compassion.
Eddie Alexander owns Triple S Electric in Henderson County, Texas.
They are an electrical contracting business. For the first 3\1/2\ years
he was in business, it was just him and one part-time helper. Since the
passage of the President's economic growth plan, he has been able to
hire two more additional employees named Jarad and John, both of whom
were out of work but both of whom now provide homes for their families.
The Democrats now want to raise taxes on Eddie Alexander and his
small business. They want to jeopardize Jarad's and John's paychecks
and replace them with welfare checks; and this they call compassion.
Gill Travers owns Travers & Company. They are a home building company
in Athens, Texas. Thanks to the housing boom created by President
Bush's tax relief plan, Travers & Company has had to hire three new
workers. Jan, who was previously unemployed, was hired to help clean up
the job sites. Business is so good she had to turn around and hire
Calvin and Christy. They were unemployed, too. The Democrats now want
to raise taxes on Gill Travers and his small business. They want to
jeopardize Jan, Calvin, and Christy's paychecks and replace them with
welfare checks; and this they call compassion.
Mr. Speaker, tax relief has created over 4.4 million new tax-paying
jobs of the future; 4.4 million hard-working Americans can now provide
for their families this Christmas. More than just providing food and
shelter, these jobs are providing newfound hope and opportunity. The
Democrats would take all of this away.
We cannot go back. We must prevent this massive Democrat tax
increase. We must support jobs and support the rule for H.R. 4297.
Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from
Washington (Mr. Baird).
Mr. BAIRD. Mr. Speaker, since I first came to Congress, I made it a
priority to restore sales tax deductibility for my constituents in
Washington State. Last year, working with a bipartisan coalition lead
by Mr. Kevin Brady and myself, we did successfully do that. This
deduction saved Washington State taxpayers over $500 million last year
alone.
Unfortunately, the sales tax deduction will expire at the end of this
year, and we must extend that deduction. Accordingly, I applaud both
the Democrats and the Republicans for including in their packages a 1-
year extension. Frankly, I would like to have made it a permanent
extension.
Nevertheless, I am concerned at a time of war in the aftermath of
this country's most devastating natural disaster how we can in good
conscience support a tax bill that will add at least $20 billion to our
national debt to provide a tax break that goes predominantly to the
wealthy, and by that I mean the capital gains and dividend tax cut.
Earlier, the distinguished chairman of the Rules Committee said the
American people get it. I have to say, I just had five town halls in my
district; the American people do get it. They get that this bill, the
Republican majority bill, is passing on enormous deficits to our
children. Debt to our children, that is what we are doing.
The Democratic substitute, by comparison, is revenue neutral. It
extends the tax breaks that benefit small individual taxpayers and
small businesses, and it extends sales tax deductibility without
increasing the deficit. What is more, the Democratic substitute
protects taxpayers against the AMT hit as people's income brings them
into the AMT category.
If my friends on the other side of the aisle want to say if we do not
extend the dividend and capital gains tax cut, we have an automatic tax
increase, why not say the same about the AMT fix? You have not chosen
to put the AMT fix in your bill. Does that not constitute an automatic
tax increase? I believe it does. The Democrats have prevented that.
The difference is this: when Republicans talk about choices, the
choices they are talking about is whether the most wealthy people in
this country will choose to take their earnings, or winnings, from
capital gains or dividends. The poor people in this country have to
choose between heating their houses and providing food for their
children.
Mr. PUTNAM. Mr. Speaker, I yield myself such time as I may consume.
I would remind the gentleman that AMT relief is not in our package
because it passed yesterday in the House by a vote of 414-4. That is
why it is not in this package, because it passed yesterday.
We all talk about what we do here in Washington as it relates to the
economy. The bottom line is that the economy is doing quite well
because Americans are out there working hard every day. A lot of them
are getting up before the sun comes up and not getting home until the
sun goes down, bringing in food and fiber from our fields,
manufacturing the devices that we take for granted each and every day
in our manufacturing facilities, and working hard in an expanding and
robust services economy, going into classrooms, going into hospitals,
building houses that are part of the American Dream for more and more
Americans. In fact, a record number of Americans now have achieved that
piece of the American Dream through homeownership.
So it is ordinary Americans doing every day what they do best that is
allowing this economy to move forward, and our role in that is to
create the climate that allows them to maximize that opportunity, to
put in place policies that keep inflation in check, keep interest rates
low, and reduce the tax burden in their lives.
Today, more corporations pay dividends than at any other time. In
fact,
[[Page H11232]]
there has been a 69 percent increase in S&P 500 companies that pay
dividends. It is not only wealthy people that are benefiting from
dividend taxes being cut and the corresponding increase in companies
paying dividends. In fact, it typically is your retirees who are owning
those stocks that they have invested in their whole lives that are
paying the dividends to supplement their retirement income.
Prior to us changing that policy, the number of companies paying
dividends over the last several years had actually gone down by 45
percent; and since the change in the tax that lowered the dividend tax,
it went up almost 70 percent. That is a clear indication that what we
did here in that small policy changed behavior in the business world to
the benefit of all Americans: poor Americans, seniors, middle class,
professionals, people who make six figures, people who make five
figures. Everybody benefited from that. In fact, disproportionately,
seniors benefited from that.
Everybody benefits from the fact that unemployment is now at 5
percent. That is indisputable. Would we like to see it go lower? Of
course. Would we like to put policies in place that do that? Of course.
Does raising taxes on the American people help lower the unemployment
rate? I do not think so. Perhaps some on the other side of the aisle
would disagree.
More Americans own stock today than ever before. This is not a class-
warfare argument: 91 million individuals own stock in America. This
bill puts in place a policy that encourages more Americans to invest in
America. That, I believe, is sound economic policy.
Mr. Speaker, I reserve the balance of my time.
Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from
Washington (Mr. Baird) to explain AMT.
Mr. BAIRD. Mr. Speaker, I am well aware of the issues with AMT. The
issue with me is this: you have not paid for it; the Democrats have.
What you are not talking about is you are passing deficit on to our
kids. You are passing debt on to our kids.
I visited with high schools and had town halls last weekend, and
people said they are desperately concerned about the size of the
Nation's deficit and the size of the Nation's debt. The Democratic
package is paid for; the Republican package is not. The Democratic
package does support small businesses and low-income folks and supports
the middle class. The Republican package, the bulk of the economic
benefits from these tax cuts go to the people who need it least at a
time when we are fighting a war and trying to recover from a disaster.
I think that is a mistake.
We support tax cuts, but we would target them to the people who most
need it; and you target them to the people who most want it, but least
need it. That is the fundamental difference, and I think the American
people see that difference.
{time} 1115
Mr. PUTNAM. Addressing the gentleman's concerns, yesterday 414
Members of the House voted for AMT relief. I am unclear which piece of
that the gentleman is referring to that the Democrats had that paid for
that as it relates to that. And the gentleman, in reference to his
concern about the deficit, which is legitimate and shared by all of us
about the growth of the deficit, failed to point out that the deficit
has gone down over $100 billion in the last year. The size of the U.S.
deficit dropped $100 billion based on the strength of the economy.
And finally, to the gentleman's point, he illustrated and spoke very
clearly and directly about the Democratic intentions with regard to tax
policy. They want to pick and choose the winners in American society,
and we want everyone, everyone on equal footing to have the opportunity
to achieve their piece of the American dream. We do not propose to pick
winners and losers in economic policy and tax policy. We say everybody
has got a shot at making the most of their opportunities in this
country. Everybody has got a shot at paying less in taxes on capital
gains. Everybody has got a shot at paying less in taxes on dividends
that are paid by companies that support all Americans. Everybody has
got an opportunity to go to college through the tax incentives that are
in there for higher education opportunities. Everybody has got an
opportunity to achieve home ownership through economic policies that
keep interest rates low and inflation in check. That is the difference,
an opportunity for each and every individual, according to their own
merits and their own hard work, and their own character and their own
ability to get out there every day to do it. And the other side's
proposal to pick and choose the winners in our society.
Mr. Speaker, I reserve the balance of my time.
Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from
Massachusetts (Mr. Markey).
Mr. MARKEY. Mr. Speaker, I rise in strong opposition to this $56
billion tax break, mostly for millionaires in our country. Forty-five
percent of this tax break goes to the ultra rich in our country, the
top 1 percent average getting $32,000 apiece in tax breaks out of this
bill. So how do they get the money? Well, last month, the Republicans
lectured us on the need to have fiscal discipline. They had to cut
Medicaid for the poorest seniors and kids. They had to cut student
loans for children across our country. They had to cut the food stamp
program for kids. But guess what? The amount of money that they were
cutting on food stamps and Medicaid and health care services and
student loans is exactly equal to the amount of money they are giving
in tax breaks to millionaires. In other words, every dollar that is cut
out of the Medicaid program is going to be put over here into tax
breaks for millionaires. $50 billion. $50 billion cut in Medicaid and
student loans, $50 billion in tax cuts for the rich. For health care
programs, as they cut the health care programs, it goes over here today
on a tax cut for millionaires.
When they cut student loans the money comes from kids and it is going
over here to millionaires. And by the way, they are $6 billion short,
so they are just going to increase the deficit. Why? So they can give
more tax breaks over here to millionaires. More tax breaks for
millionaires. Cut poor people, cut children, cut Medicaid benefits, cut
the money that we are going to be giving to seniors, to keep them in
nursing homes with Alzheimer's and with Parkinson's disease, just keep
cutting it. Give more tax breaks to the millionaires. Something is
going to have to be cut.
They cut the poorest. They cut the most vulnerable. They cut the
youngest. And where does the money go? The money goes to millionaires.
That is what this whole thing is about. It is one big scam. You know,
there is an old joke. The priest goes up into the pulpit on Sunday and
he says, on Wednesday, Father O'Brien will lecture on the evils of
gambling in the church hall. On Thursday in the church hall, bingo.
Last month the Republicans lectured us on the need for them to cut
poor people to do something about the deficit. Today, bingo. Tax cuts
for the millionaires. Every millionaire is a winner in America under
the Republicans' plan. But the money is all coming from the poorest
people in our country and it is going over into the hands of those who
need it least. Vote no on this Republican atrocity in our country at a
time when the poor need it the most and the rich need it the least.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore (Mr. LaHood). The Chair will remind all
persons in the gallery that they are here as guests of the House and
that any manifestation of approval or disapproval of proceedings or
other audible conversation is in violation of the rules of the House.
Mr. PUTNAM. Mr. Speaker, I yield myself such time as I may consume.
Recognizing that volume does not always make up for sound policy, I
would just pose the question as to why the Democratic substitute leaves
out many of the people that the gentleman purported to speak for. The
Democratic substitute does not include the savers credit for low income
families, those low income families who are contributing to IRAs and
pension plans, scrimping and saving every day, every week, every month
to put aside money to prepare for their own retirement, to
[[Page H11233]]
prepare for their own retirement security so that they are not solely
dependent on the government. Their substitute is silent on that point.
Why are they silent on the point of assistance for small businesses,
allowing them to increase section 179 expensing so that they can get
that new piece of equipment, add the new line, which means more
employees, more growth, more purchasing and a better economic ripple
effect in the community? Why do you leave out small businesses along
with your low income savers?
Why do you leave out the part that impacts domestic manufacturers who
finance sales of large equipment to foreign customers?
We hear an awful lot of concern about outsourcing. Here you have
American-based companies doing everything they can to trade in an
increasingly complex globalized economy, and you leave them out of your
substitute.
Why do you leave out the parts that deal with capital gains and
dividends? Why is it only about the wealthy and not about every one of
those 91 million Americans who own stock, who are trying to invest in
America, who understand that markets offer them an opportunity to grow
and create opportunities that they may not have had otherwise?
Why are all of those 91 million Americans who participate in our
capital market so bad? Why are they such awful people that they ought
to be singled out and excluded from the tax policy that you have
created?
Why do you leave out the tax credits for cleaning up brownfield
sites? That is something that I have always thought was the cornerstone
of the Democratic Party, cleaning up our environment. It is certainly
something that we are proud of our record on with Teddy Roosevelt and
our conservation effort. We believe that you can use the Tax Code to
encourage businesses to go into areas that formerly were
environmentally damaged sites and clean them up and create jobs and
opportunity in otherwise blighted areas. This is an issue that impacts
disproportionately urban areas. Why would we leave them out? The
Democratic substitute is silent on these points.
It is important that we move forward together with sound economic
policies that encourage people to invest and save and be a part of this
ever complicated globalized economy, not pick and choose the winners
and single out individual cases of success to be punished, which is
what their bill seeks to do.
Mr. Speaker, I reserve the balance of my time.
Ms. SLAUGHTER. Mr. Speaker, I have one remaining speaker. May I
inquire if my colleague is about ready to close?
Mr. PUTNAM. I have one remaining speaker as well.
Ms. SLAUGHTER. Mr. Speaker, I yield 4 minutes to the gentleman from
North Dakota (Mr. Pomeroy).
Mr. POMEROY. Mr. Speaker, much of the rhetoric coming from the
majority in defense of this sinful package is pure fiction. So let us
discuss it in those terms. You know, Charles Dickens has written
perhaps one of the most famous pieces of fiction discussed at this time
of year, the holiday season, A Christmas Carol. The lesson of Christmas
Carol, Scrooge, this miserly man, very, very well fixed financially
that chose not to give to others. And we know that in the course of
this beautiful story the ghosts of Christmas past help him reflect upon
the paucity of his life, and in the end he has a new spirit of
community, helping others, including the Cratchett family, with the
crippled son, Tiny Tim.
Well, I think that what the majority wants to do is rewrite the
Christmas Carol. It is probably going to be titled ``A Christmas Carol
II, Revenge of the Scrooge.'' And in this Christmas Carol, Scrooge,
sitting in his mansion, contemplating his wealth, wants more. And
rather than be challenged as to the paucity of his inclination, we have
a Republican majority, bought and paid for, that is all too eager to
placate the most selfish whim of Mr. Scrooge.
And so, as the story unfolds, there is more and more for Scrooge, and
taking, from the very beginning, a low base, less and less for Mr.
Cratchett who loses his job when it is outsourced overseas, tries to
find something at minimum wage which has not been raised since 1997,
and Tiny Tim, Tiny Tim is left out all together.
Let us ask ourselves some basic questions about this. After passing a
$31 billion tax reduction yesterday out of this House, do we really
want to add an additional $56 billion without having it paid for?
Look at this. This shows that we are north of $8 trillion in
accumulated debt, that the average share is $27,000 of debt per
American.
You know, another Christmas story talks about naughty children
getting a lump of coal in their stocking. Well, this majority gives
every child $27,000 of debt, debt that will fall on their shoulders
when the baby boomers retire with this debt woefully unpaid.
The second question, do we need it? You know about half of this
package today, for all the talk about how desperately it is needed,
does not take effect until 2009 and 2010. Existing Tax Code makes the
very provision that they are talking about in 2006, in 2007 and in
2008. It is there for the next 3 years. They are talking about driving
us deeper in debt today, cutting programs that help people today so
that we can deal with something that happens in 2009 and 2010.
Next question. Is it fair? Well, in looking at who gets what under
this bill, you know, most of the people in this country, 55 percent,
earn less than $40,000. They will come out on average $7, $7 per under
this dividend and tax cut provision. One out of 500, one out of 500
taxpayers, the most affluent of the 500, one out of 500 get nearly half
of this bill. And they will average, per taxpayer, more than $30,000
back. So in this Christmas season, we are hammering on programs that
help those who need help.
We are passing a tax package that gives nothing, virtually, to most
under this capital gains dividend tax cut provision, and we are
absolutely loading it up for the wealthiest few in this country. This
is Christmas Carol II. This is Revenge of the Scrooge. This is totally
bad policy, and it must be stopped.
I urge a no vote on this rule.
Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the distinguished
chairman of the Ways and Means Committee, the gentleman from California
(Mr. Thomas).
(Mr. THOMAS asked and was given permission to revise and extend his
remarks.)
Mr. THOMAS. Well, I guess we are going to be telling Christmas
stories. Rather than fiction, I would rather deal with fact. Yesterday
414 Members of the House voted to assist a group who, on average, are
far richer than those who receive dividends and cap gains. There were
four no votes. All four of them were on the Democratic side of the
aisle. And I respect those people for casting what I believe was a
sincere vote. But out of the 188 Democrats who voted aye, I just have
to point out that my friend who just finished speaking, who is on the
Ways and Means Committee, protesting the amount in this vote, voted
aye. Some of the other folks, just let me run down the list
alphabetically, which tends to touch on Lowey, Lynch, Maloney, Markey,
you heard him, Marshall, Matheson, Matsui, McCarthy, McCollum,
McDermott, all of them voted to assist those individuals in this
society that are far richer, on average, than many of those seniors
who, investing prudently over the years, receive dividends and capital
gains on their investment in deferred consumption that they need, in
their senior years.
{time} 1130
So as we listen to the rhetoric and the term ``millionaire'' is
repeated over and over again by my friends on the other side of the
aisle, it begins to be a question of whose millionaire are they talking
about. If one is a millionaire in Massachusetts, it seems, we want to
protect them. If one is a millionaire in New York, we want to protect
them.
At some point the rhetoric, the fiction, has to be compared to the
truth. The truth is 188 Democrats, every Democrat member of the Ways
and Means Committee, voted to assist people yesterday that are far
richer on average than the individuals who receive dividends and cap
gains. That is not a Christmas story. That is the truth.
Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from
New York (Mr. Rangel).
Mr. RANGEL. Mr. Speaker, the gentleman picked a heck of a time to
lose his voice here now.
[[Page H11234]]
Mr. THOMAS. Mr. Speaker, will the gentleman yield?
I thought the gentlewoman from New York indicated she had one final
speaker, and that final speaker spoke, Mr. Pomeroy.
Mr. RANGEL. I am terribly sorry. I will take it up then when we have
the opportunity.
Mr. THOMAS. I was asking the gentlewoman from New York.
Ms. SLAUGHTER. As it happens, I have extra time, and I yielded to Mr.
Rangel to respond to your comments.
Mr. THOMAS. Notwithstanding the equal time, Mr. Speaker, if the
gentlewoman says it is a final speaker, we normally honor that.
The SPEAKER pro tempore (Mr. LaHood). The gentleman from New York is
recognized for 3 minutes.
Mr. RANGEL. Mr. Speaker, I do not want to get technical about this. I
just want to set the record straight, and that is that we all agree
that the alternative minimum tax is an unfair tax on people because it
was not planned by the Ways and Means Committee and by the Congress.
So, of course, we thought yesterday and we think today that these
people, who through inflation were thrown into this category, should be
protected. And that is why we were so disappointed that the
Republicans, by party line, rejected the Democrats when we were doing
the bill in the committee from not being included in the reconciliation
bill.
Now, we all know that the bill that we passed yesterday on the
suspension calendar is not protected like this $56 billion is protected
today. As a matter of fact, people should know that it may appear to be
a technicality, but the only way that this alternative minimum release
bill that we passed yesterday in the suspension calendar is that not
one of the 100 Senators over there objects. We need the consent of
every Senator to provide the AMT bill with protection. That is not so.
If the Republicans were so concerned about these people who got caught
into this trap in getting the alternative minimum tax treatment, it
would be placed in the reconciliation bill.
So I do not think you ought to bring up things when the facts are
against you. It is true that you have decided that those people who
want relief on capital gains taxes and corporate dividends, even though
they do not get hit until 2009, that you are prepared to have the
people who get by the AMT this year or next year, rather, in their tax
burden to get hit at the expense of those people that are much richer
and much smaller in number.
So I really think that in this holiday season, we are doing enough
damage without distorting the truth. You have had your priorities in
terms of protecting the AMT people or protecting the group that is
going to be allegedly protected today, even though they do not need
any, not today, not next year, and not the year after.
So those are the facts, and I thank the gentlewoman from New York for
affording us the opportunity to at least, in this holiday season,
whether we like the bill or not, let truth prevail.
Ms. SLAUGHTER. Mr. Speaker, I yield myself the balance of my time.
I would like to urge a ``no'' vote on the rule, a ``no'' vote on the
bill, and say to every Member of the House of Representatives if they
want the AMT fix protected, the only way in the world they can do it
today is to vote for the Democrat substitute.
Mr. Speaker, I have no further requests for time, and I yield back
the balance of my time.
Mr. PUTNAM. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, the debate here has been consumed by the discussion of
capital gains and dividends, and that is a big part of this and that is
appropriate.
But the AMT relief component, which has been the source of much
recent debate, we dealt with yesterday. We dealt with it on a vote of
414-4, overwhelming, bipartisan, on the suspension calendar, which I
will remind Members under the rule, requires a two-thirds vote to pass.
It is out of here. The AMT relief bill moved through here in an
expeditious manner on a bipartisan basis.
What this bill does is provide continued assistance for those people
who are saving to go to college. Middle- and low-income students, this
is their shot at going to college. Assistance for those who are saving
for retirement, seniors, low income, saving through an IRA and a
pension plan for retirement. Ten States that do not have a State income
tax that want the same tax treatment that high-tax States have, this
expires in 3 weeks unless we pass the bill. Just one of several
important components in this tax relief package.
It is vitally important that we pass this and not allow taxes to go
up 3 weeks from now on those 10 States, not allow teachers to lose
their deductibility on classroom supplies, not allow low-income seniors
and savers to be punished under the Democratic plan.
Mr. Speaker, I urge the Members to support the rule and support the
underlying bill.
Mr. Speaker, I yield back the balance of my time, and I move the
previous question on the resolution.
The previous question was ordered.
The resolution was agreed to.
A motion to reconsider was laid on the table.
Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 588, I call up
the bill (H.R. 4297) to provide for reconciliation pursuant to section
201(b) of the concurrent resolution on the budget for fiscal year 2006,
and ask for its immediate consideration.
The Clerk read the title of the bill.
The SPEAKER pro tempore. Pursuant to House Resolution 588, the bill
is considered read and the amendment in the nature of a substitute
printed in the bill is adopted.
The text of the amendment in the nature of a substitute is as
follows:
H.R. 4297
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Tax Relief
Extension Reconciliation Act of 2005''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title, etc.
TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006
Sec. 101. Allowance of nonrefundable personal credits against regular
and minimum tax liability.
Sec. 102. Tax incentives for business activities on Indian
reservations.
Sec. 103. Work opportunity credit.
Sec. 104. Welfare-to-work credit.
Sec. 105. Deduction for corporate donations of computer technology and
equipment.
Sec. 106. Availability of medical savings accounts.
Sec. 107. 15-year cost recovery for leasehold improvements.
Sec. 108. 15-year cost recovery for restaurant improvements.
Sec. 109. Taxable income limit on percentage depletion for oil and
natural gas produced from marginal properties.
Sec. 110. District of Columbia Enterprise Zone.
Sec. 111. Possession tax credit with respect to American Samoa.
Sec. 112. Parity in the application of certain limits to mental health
benefits.
Sec. 113. Research credit.
Sec. 114. Qualified Zone Academy Bonds.
Sec. 115. Certain expenses of elementary and secondary school teachers.
Sec. 116. Qualified tuition and related expenses.
Sec. 117. State and local general sales taxes.
TITLE II--EXTENSIONS OF CERTAIN PROVISIONS FOR 2 ADDITIONAL YEARS AND
OTHER MODIFICATIONS
Sec. 201. Expensing of environmental remediation costs.
Sec. 202. Controlled foreign corporations.
Sec. 203. Capital gains and dividends rates.
Sec. 204. Saver's credit.
Sec. 205. Increased expensing for small business.
TITLE III--OTHER PROVISIONS
Sec. 301. Clarification of taxation of certain settlement funds.
Sec. 302. Modification of active business definition under section 355.
Sec. 303. Veterans' mortgage bonds.
Sec. 304. Capital gains treatment for certain self-created musical
works.
Sec. 305. Vessel tonnage limit.
Sec. 306. Modification of special arbitrage rule for certain funds.
TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006
SEC. 101. ALLOWANCE OF NONREFUNDABLE PERSONAL CREDITS AGAINST
REGULAR AND MINIMUM TAX LIABILITY.
(a) In General.--Paragraph (2) of section 26(a) (relating
to special rule for taxable years 2000 through 2005) is
amended--
(1) in the text by striking ``or 2005'' and inserting
``2005, or 2006'', and
(2) in the heading by striking ``2005'' and inserting
``2006''.
[[Page H11235]]
(b) Conforming Provisions.--
(1) Subsection (i) of section 904 (relating to coordination
with nonrefundable personal credits) is amended by striking
``or 2005'' and inserting ``2005, or 2006''.
(2) The amendments made by sections 201(b), 202(f), and
618(b) of the Economic Growth and Tax Relief Reconciliation
Act of 2001 shall not apply to taxable years beginning during
2006.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 102. TAX INCENTIVES FOR BUSINESS ACTIVITIES ON INDIAN
RESERVATIONS.
(a) Indian Employment Tax Credit.--
(1) In general.--Subsection (f) of section 45A (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to taxable years beginning after December 31,
2005.
(b) Accelerated Depreciation for Business Property on
Indian Reservations.--
(1) In general.--Paragraph (8) of section 168(j) (relating
to termination) is amended by striking ``December 31, 2005''
and inserting ``December 31, 2006''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply with respect to property placed in service after
December 31, 2005.
SEC. 103. WORK OPPORTUNITY CREDIT.
(a) In General.--Subparagraph (B) of section 51(c)(4)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Increase in Age Limit for Food Stamp Recipients.--
Clause (i) of section 51(d)(8)(A) (relating to qualified food
stamp recipient) is amended by striking ``25'' and inserting
``35''.
(c) Effective Date.--The amendments made by this section
shall apply to individuals who begin work for the employer
after December 31, 2005.
SEC. 104. WELFARE-TO-WORK CREDIT.
(a) In General.--Subsection (f) of section 51A (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to individuals who begin work for the employer
after December 31, 2005.
SEC. 105. DEDUCTION FOR CORPORATE DONATIONS OF COMPUTER
TECHNOLOGY AND EQUIPMENT.
(a) In General.--Subparagraph (G) of section 170(e)(6)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contributions made in taxable years beginning
after December 31, 2005.
SEC. 106. AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.
(a) In General.--Paragraphs (2) and (3)(B) of section
220(i) (defining cut-off year) are each amended by striking
``2005'' each place it appears in the text and headings and
inserting ``2006''.
(b) Conforming Amendments.--
(1) Paragraph (2) of section 220(j) is amended--
(A) in the text by striking ``or 2004'' each place it
appears and inserting ``2004, or 2005'', and
(B) in the heading by striking ``or 2004'' and inserting
``2004, or 2005''.
(2) Subparagraph (A) of section 220(j)(4) is amended by
striking ``and 2004'' and inserting ``2004, and 2005''.
(c) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.
(d) Time for Filing Reports, Etc.--
(1) The report required by section 220(j)(4) of the
Internal Revenue Code of 1986 to be made on August 1, 2005,
shall be treated as timely if made before the close of the
90-day period beginning on the date of the enactment of this
Act.
(2) The determination and publication required by section
220(j)(5) of such Code with respect to calendar year 2005
shall be treated as timely if made before the close of the
120-day period beginning on the date of the enactment of this
Act. If the determination under the preceding sentence is
that 2005 is a cut-off year under section 220(i) of such
Code, the cut-off date under such section 220(i) shall be the
last day of such 120-day period.
SEC. 107. 15-YEAR COST RECOVERY FOR LEASEHOLD IMPROVEMENTS.
(a) In General.--Clause (iv) of section 168(e)(3)(E)
(relating to 15-year property) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to property placed in service after December 31,
2005.
SEC. 108. 15-YEAR COST RECOVERY FOR RESTAURANT IMPROVEMENTS.
(a) In General.--Clause (v) of section 168(e)(3)(E)
(relating to 15-year property) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to property placed in service after December 31,
2005.
SEC. 109. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR
OIL AND NATURAL GAS PRODUCED FROM MARGINAL
PROPERTIES.
(a) In General.--Subparagraph (H) of section 613A(c)(6)
(relating to oil and natural gas produced from marginal
properties) is amended by striking ``January 1, 2006'' and
inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 110. DISTRICT OF COLUMBIA ENTERPRISE ZONE.
(a) Period for Which Designation Applicable.--Subsection
(f) of section 1400 (relating to time for which designation
applicable) is amended by striking ``December 31, 2005'' both
places it appears and inserting ``December 31, 2006''.
(b) Tax-Exempt Economic Development Bonds.--Subsection (b)
of section 1400A (relating to period of applicability) is
amended by striking ``December 31, 2005'' and inserting
``December 31, 2006''.
(c) Zero Percent Capital Gains Rate.--
(1) In general.--Subsection (b) of section 1400B (relating
to DC Zone Asset) is amended by striking ``January 1, 2006''
each place it appears and inserting ``January 1, 2007''.
(2) Conforming amendments.--
(A) Paragraph (2) of section 1400B(e) (relating to gain
before 1998 and after 2010 not qualified) is amended--
(i) by striking ``December 31, 2010'' and inserting
``December 31, 2011'', and
(ii) by striking ``2010'' in the heading and inserting
``2011''.
(B) Paragraph (2) of section 1400B(g) (relating to sales
and exchanges of interests in partnerships and S corporations
which are DC Zone businesses) is amended by striking
``December 31, 2010'' and inserting ``December 31, 2011''.
(C) Subsection (d) of section 1400F (relating to certain
rules to apply) is amended by striking ``December 31, 2010''
and inserting ``December 31, 2011''.
(d) First-Time Homebuyer Credit for District of Columbia.--
Subsection (i) of section 1400C (relating to application of
section) is amended by striking ``January 1, 2006'' and
inserting ``January 1, 2007''.
(e) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall take effect on January
1, 2006.
(2) Tax-exempt economic development bonds.--The amendment
made by subsection (b) shall apply to obligations issued
after the date of the enactment of this Act.
SEC. 111. POSSESSION TAX CREDIT WITH RESPECT TO AMERICAN
SAMOA.
(a) In General.--Subparagraph (A) of section 936(j)(8)
(relating to special rules for certain possessions) is
amended by inserting before the period at the end the
following: ``(before January 1, 2007, in the case of American
Samoa)''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 112. PARITY IN THE APPLICATION OF CERTAIN LIMITS TO
MENTAL HEALTH BENEFITS.
(a) In General.--Paragraph (3) of section 9812(f) (relating
to application of section) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Effective Dates.--The amendment made by subsection (a)
shall take effect on the date of the enactment of this Act.
SEC. 113. RESEARCH CREDIT.
(a) Extension.--
(1) In general.--Subparagraph (B) of section 41(h)(1)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(2) Conforming amendment.--Subparagraph (D) of section
45C(b)(1) (relating to special rule) is amended by striking
``December 31, 2005'' and inserting ``December 31, 2006''.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after December 31,
2005.
(b) Increase in Rates of Alternative Incremental Credit.--
(1) In general.--Subparagraph (A) of section 41(c)(4)
(relating to election of alternative incremental credit) is
amended--
(A) by striking ``2.65 percent'' and inserting ``3
percent'',
(B) by striking ``3.2 percent'' and inserting ``4
percent'', and
(C) by striking ``3.75 percent'' and inserting ``5
percent''.
(2) Effective date.--The amendments made by this subsection
shall apply to taxable years ending after the date of the
enactment of this Act.
(c) Alternative Simplified Credit for Qualified Research
Expenses.--
(1) In general.--Subsection (c) of section 41 (relating to
base amount) is amended by redesignating paragraphs (5) and
(6) as paragraphs (6) and (7), respectively, and by inserting
after paragraph (4) the following new paragraph:
``(5) Election of alternative simplified credit.--
``(A) In general.--At the election of the taxpayer, the
credit determined under subsection (a)(1) shall be equal to
12 percent of so much of the qualified research expenses for
the taxable year as exceeds 50 percent of the average
qualified research expenses for the 3 taxable years preceding
the taxable year for which the credit is being determined.
``(B) Special rule in case of no qualified research
expenses in any of 3 preceding taxable years.--
``(i) Taxpayers to which subparagraph applies.--The credit
under this paragraph shall be determined under this
subparagraph if the taxpayer has no qualified research
expenses in any one of the 3 taxable years preceding the
taxable year for which the credit is being determined.
``(ii) Credit rate.--The credit determined under this
subparagraph shall be equal to 6 percent of the qualified
research expenses for the taxable year.
``(C) Election.--An election under this paragraph shall
apply to the taxable year for which made and all succeeding
taxable years unless revoked with the consent of the
Secretary. An election under this paragraph may not be made
[[Page H11236]]
for any taxable year to which an election under paragraph (4)
applies.''.
(2) Coordination with election of alternative incremental
credit.--
(A) In general.--Section 41(c)(4)(B) (relating to election)
is amended by adding at the end the following: ``An election
under this paragraph may not be made for any taxable year to
which an election under paragraph (5) applies.''.
(B) Transition rule.--In the case of an election under
section 41(c)(4) of the Internal Revenue Code of 1986 which
applies to the taxable year which includes the date of the
enactment of this Act, such election shall be treated as
revoked with the consent of the Secretary of the Treasury if
the taxpayer makes an election under section 41(c)(5) of such
Code (as added by subsection (a)) for such year.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years ending after the date of the
enactment of this Act.
SEC. 114. QUALIFIED ZONE ACADEMY BONDS.
(a) In General.--Paragraph (1) of section 1397E(e)
(relating to national limit) is amended by striking ``and
2005'' and inserting ``2005, and 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to obligations issued after December 31, 2005.
SEC. 115. CERTAIN EXPENSES OF ELEMENTARY AND SECONDARY SCHOOL
TEACHERS.
(a) In General.--Subparagraph (D) of section 62(a)(2)
(relating to certain expenses of elementary and secondary
school teachers) is amended by striking ``or 2005'' and
inserting ``2005, or 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to expenses paid or incurred in taxable years
beginning after December 31, 2005.
SEC. 116. QUALIFIED TUITION AND RELATED EXPENSES.
(a) In General.--Subsection (e) of section 222 (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(b) Limitations.--Paragraph (2) of section 222(b) (relating
to applicable dollar limit) is amended by striking
subparagraphs (A) and (B), by redesignating subparagraph (C)
as subparagraph (B), and by inserting before subparagraph (B)
(as so redesignated) the following:
``(A) 2006.--In the case of a taxable year beginning in
2006, the applicable dollar amount shall be equal to--
``(i) in the case of a taxpayer whose adjusted gross income
for the taxable year does not exceed $65,000 ($130,000 in the
case of a joint return), $4,000,
``(ii) in the case of a taxpayer not described in clause
(i) whose adjusted gross income for the taxable year does not
exceed $80,000 ($160,000 in the case of a joint return),
$2,000, and
``(iii) in the case of any other taxpayer, zero.''.
(c) Effective Date.--The amendments made by this section
shall apply to payments made in taxable years beginning after
December 31, 2005.
SEC. 117. STATE AND LOCAL GENERAL SALES TAXES.
(a) In General.--Subparagraph (I) of section 164(b)(5)
(relating to application of paragraph) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
TITLE II--EXTENSIONS OF CERTAIN PROVISIONS FOR 2 ADDITIONAL YEARS AND
OTHER MODIFICATIONS
SEC. 201. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS.
(a) Extension of Termination Date.--Subsection (h) of
section 198 (relating to termination) is amended by striking
``December 31, 2005'' and inserting ``December 31, 2007''.
(b) Petroleum Products Treated as Hazardous Substance.--
Paragraph (1) of section 198(d) (relating to hazardous
substance) is amended by striking ``and'' at the end of
subparagraph (A), by striking the period at the end of
subparagraph (B) and inserting ``, and'', and by adding at
the end the following new subparagraph:
``(C) any petroleum product (as defined in section
4612(a)(3)).''.
(c) Effective Date.--The amendments made by this section
shall apply to expenditures paid or incurred after December
31, 2005.
SEC. 202. CONTROLLED FOREIGN CORPORATIONS.
(a) Subpart F Exception for Active Financing.--
(1) Exempt insurance income.--Paragraph (10) of section
953(e) (relating to application) is amended--
(A) by striking ``January 1, 2007'' and inserting ``January
1, 2009'', and
(B) by striking ``December 31, 2006'' and inserting
``December 31, 2008''.
(2) Exception to treatment as foreign personal holding
company income.--Paragraph (9) of section 954(h) (relating to
application) is amended by striking ``January 1, 2007'' and
inserting ``January 1, 2009''.
(b) Look-Through Treatment of Payments Between Related
Controlled Foreign Corporations Under the Foreign Personal
Holding Company Rules.--Subsection (c) of section 954
(relating to foreign personal holding company income) is
amended by adding at the end the following new paragraph:
``(6) Look-thru rule for related controlled foreign
corporations.--
``(A) In general.--For purposes of this subsection,
dividends, interest, rents, and royalties received or accrued
from a controlled foreign corporation which is a related
person shall not be treated as foreign personal holding
company income to the extent attributable or properly
allocable (determined under rules similar to the rules of
subparagraphs (C) and (D) of section 904(d)(3)) to income of
the related person which is not subpart F income. For
purposes of this subparagraph, interest shall include
factoring income which is treated as income equivalent to
interest for purposes of paragraph (1)(E). The Secretary
shall prescribe such regulations as may be appropriate to
prevent the abuse of the purposes of this paragraph.
``(B) Application.--Subparagraph (A) shall apply to taxable
years of foreign corporations beginning after December 31,
2005, and before January 1, 2009, and to taxable years of
United States shareholders with or within which such taxable
years of foreign corporations end.''.
SEC. 203. CAPITAL GAINS AND DIVIDENDS RATES.
Section 303 of the Jobs and Growth Tax Relief
Reconciliation Act of 2003 is amended by striking ``December
31, 2008'' and inserting ``December 31, 2010''.
SEC. 204. SAVER'S CREDIT.
Subsection (h) of section 25B (relating to elective
deferrals and IRA contributions by certain individuals) is
amended by striking ``December 31, 2006'' and inserting
``December 31, 2008''.
SEC. 205. INCREASED EXPENSING FOR SMALL BUSINESS.
Subsections (b)(1), (b)(2), (b)(5), (c)(2), and
(d)(1)(A)(ii) of section 179(b) (relating to election to
expense certain depreciable business assets) are each amended
by striking ``2008'' and inserting ``2010''.
TITLE III--OTHER PROVISIONS
SEC. 301. CLARIFICATION OF TAXATION OF CERTAIN SETTLEMENT
FUNDS.
(a) In General.--Subsection (g) of section 468B (relating
to clarification of taxation of certain funds) is amended to
read as follows:
``(g) Clarification of Taxation of Certain Funds.--
``(1) In general.--Except as provided in paragraph (2),
nothing in any provision of law shall be construed as
providing that an escrow account, settlement fund, or similar
fund is not subject to current income tax. The Secretary
shall prescribe regulations providing for the taxation of any
such account or fund whether as a grantor trust or otherwise.
``(2) Exemption from tax for certain settlement funds.--An
escrow account, settlement fund, or similar fund shall be
treated as beneficially owned by the United States and shall
be exempt from taxation under this subtitle if--
``(A) it is established pursuant to a consent decree
entered by a judge of a United States District Court,
``(B) it is created for the receipt of settlement payments
as directed by a government entity for the sole purpose of
resolving or satisfying one or more claims asserting
liability under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980,
``(C) the authority and control over the expenditure of
funds therein (including the expenditure of contributions
thereto and any net earnings thereon) is with such government
entity, and
``(D) upon termination, any remaining funds will be
disbursed to such government entity for use in accordance
with applicable law.
For purposes of this paragraph, the term `government entity'
means the United States, any State or political subdivision
thereof, the District of Columbia, any possession of the
United States, and any agency or instrumentality of any of
the foregoing.
``(3) Termination.--Paragraph (2) shall not apply to
accounts and funds established after December 31, 2010.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to accounts and funds established after the date
of the enactment of this Act.
SEC. 302. MODIFICATION OF ACTIVE BUSINESS DEFINITION UNDER
SECTION 355.
Subsection (b) of section 355 (defining active conduct of a
trade or business) is amended by adding at the end the
following new paragraph:
``(3) Special rule relating to active business
requirement.--
``(A) In general.--In the case of any distribution made
after the date of the enactment of this paragraph and before
December 31, 2010, a corporation shall be treated as meeting
the requirement of paragraph (2)(A) if and only if such
corporation is engaged in the active conduct of a trade or
business.
``(B) Affiliated group rule.--For purposes of subparagraph
(A), all members of such corporation's separate affiliated
group shall be treated as one corporation. For purposes of
the preceding sentence, a corporation's separate affiliated
group is the affiliated group which would be determined under
section 1504(a) if such corporation were the common parent
and section 1504(b) did not apply.
``(C) Transition rule.--Subparagraph (A) shall not apply to
any distribution pursuant to a transaction which is--
``(i) made pursuant to an agreement which was binding on
the date of the enactment of this paragraph and at all times
thereafter,
``(ii) described in a ruling request submitted to the
Internal Revenue Service on or before such date, or
``(iii) described on or before such date in a public
announcement or in a filing with the Securities and Exchange
Commission.
The preceding sentence shall not apply if the distributing
corporation elects not to have such sentence apply to
distributions of such corporation. Any such election, once
made, shall be irrevocable.
``(D) Special rule for certain pre-enactment
distributions.--For purposes of determining the continued
qualification under paragraph (2)(A) of distributions made
before the date of the enactment of this paragraph as a
result of an acquisition, disposition, or other restructuring
after such date and before December
[[Page H11237]]
31, 2010, such distribution shall be treated as made after
the date of the enactment of this paragraph for purposes of
applying subparagraphs (A) through (C) of this paragraph.''.
SEC. 303. VETERANS' MORTGAGE BONDS.
(a) All Veterans Eligible for State Home Loan Programs
Funded by Qualified Veterans' Mortgage Bonds.--
(1) In general.--Paragraph (4) of section 143(l) (defining
qualified veteran) is amended--
(A) by striking ``at some time before January 1, 1977'' in
subparagraph (A), and
(B) by striking subparagraph (B) and inserting the
following:
``(B) who applied for the financing before the date 25
years after the last date on which such veteran left active
service.''.
(2) Effective date.--The amendments made by this subsection
shall apply to financing provided after the date of the
enactment of this Act.
(b) Revision of State Veterans Limit.--
(1) In general.--Subparagraph (B) of section 143(l)(3)
(relating to volume limitation) is amended to read as
follows:
``(B) State veterans limit.--
``(i) In general.--A State veterans limit for any calendar
year is the amount equal to--
``(I) $53,750,000 for the State of Texas,
``(II) $66,250,000 for the State of California,
``(III) $25,000,000 for the State of Oregon,
``(IV) $25,000,000 for the State of Wisconsin, and
``(V) $25,000,000 for the State of Alaska.
``(ii) Phasein.--In the case of calendar years beginning
before 2010, clause (i) shall be applied by substituting for
each of the dollar amounts therein by the applicable
percentage. For purposes of the preceding sentence, the
applicable percentage shall be determined in accordance with
the following table:
Applicable
``Calendar Year: percentage is:
2006......................................................20 percent
2007......................................................40 percent
2008......................................................60 percent
2009......................................................80 percent.
``(iii) Termination.--The State veterans limit for any
calendar year after 2010 is zero.''.
(2) Effective date.--The amendment made by this subsection
shall apply to bonds issued after December 31, 2005.
SEC. 304. CAPITAL GAINS TREATMENT FOR CERTAIN SELF-CREATED
MUSICAL WORKS.
(a) In General.--Subsection (b) of section 1221 (relating
to capital asset defined) is amended by redesignating
paragraph (3) as paragraph (4) and by inserting after
paragraph (2) the following new paragraph:
``(3) Sale or exchange of self-created musical works.--At
the election of the taxpayer, paragraphs (1) and (3) of
subsection (a) shall not apply with respect to any sale or
exchange before January 1, 2011, of musical compositions or
copyrights in musical works by a taxpayer described in
subsection (a)(3).''.
(b) Limitation on Charitable Contributions.--Subparagraph
(A) of section 170(e)(1) is amended by inserting
``(determined without regard to section 1221(b)(3))'' after
``long-term capital gain''.
(c) Effective Date.--The amendments made by this section
shall apply to sales and exchanges in taxable years beginning
after the date of the enactment of this Act.
SEC. 305. VESSEL TONNAGE LIMIT.
(a) In General.--Paragraph (4) of section 1355(a) (relating
to qualifying vessel) is amended by inserting ``(6,000, in
the case of taxable years beginning after December 31, 2005,
and ending before January 1, 2011)'' after ``10,000''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 306. MODIFICATION OF SPECIAL ARBITRAGE RULE FOR CERTAIN
FUNDS.
In the case of bonds issued after the date of the enactment
of this Act and before August 31, 2009--
(1) the requirement of paragraph (1) of section 648 of the
Deficit Reduction Act of 1984 (98 Stat. 941) shall be treated
as met with respect to the securities or obligations referred
to in such section if such securities or obligations are held
in a fund the annual distributions from which cannot exceed 7
percent of the average fair market value of the assets held
in such fund except to the extent distributions are necessary
to pay debt service on the bond issue, and
(2) paragraph (3) of such section shall be applied by
substituting ``distributions from'' for ``the investment
earnings of'' both places it appears.
The SPEAKER pro tempore. After 1 hour of debate on the bill, as
amended, it shall be in order to consider the further amendment printed
in House Report 109-330, if offered by the gentleman from New York (Mr.
Rangel) or his designee, which shall be considered read, and shall be
debatable for 1 hour, equally divided and controlled by the proponent
and an opponent.
The gentleman from California (Mr. Thomas) and the gentleman from New
York (Mr. Rangel) each will control 30 minutes of debate on the bill.
The Chair recognizes the gentleman from California.
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
(Mr. THOMAS asked and was given permission to revise and extend his
remarks.)
Mr. THOMAS. Mr. Speaker, this is a bill that does not deserve the
kind of rhetoric that is being delivered so far, at least that which I
have heard on the rule. This bill consists of extending current tax
provisions. It virtually breaks no new ground. It merely retains those
structures supported in committee, for example, in a bipartisan way, to
allow people to continue to utilize current tax privileges.
I have a hard time when I listen to the rhetoric associated with the
description of this bill when one of the provisions, for example, is
the authority to issue qualified zone academy bonds for school
modernization, equipment in high-poverty areas. I cannot believe my
colleagues on the other side of the line are opposed to that. Above-
the-line deduction for higher education expenses, in opposing this
bill, I guess they are opposed to that. Continue the deduction for
State and local sales taxes due to expire, I guess they are opposed to
that.
I could go through and point out a number of items. For example, the
work opportunity tax credits for hiring individuals who face barriers
to employment, in addition to the extension. The age limit for eligible
food stamp recipients is increased from 25 to 35. Maybe they are
opposed to that.
I guess when we go through and examine these various provisions, if
those are items that are reserved for the rich, the millionaires and
the privileged, I guess I just do not understand it.
But they are required to attack any bill that allows Americans to
hang on to their own hard-earned money. That is just kind of
fundamental, I guess.
My concern is if they are going to produce the kind of rhetoric they
are producing on a piece of tax legislation which simply extends
current law, what are they going to do when we have to rethink the way
in which we tax people today to make sure that we do not destroy the
economic engine in this country that produces the quality of life-style
for each and every American?
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
(Mr. RANGEL asked and was given permission to revise and extend his
remarks.)
Mr. RANGEL. Mr. Speaker, I welcome the opportunity to join with the
Republicans to send this holiday message to millions of Americans that
will be affected by this bill, especially to the fraction of 1 percent
that would be the beneficiaries of a substantial reduction in capital
gains and corporate dividends. It is true, while this only represents
20 to 25 percent of the bill, it should be made abundantly clear that
these benefits would not be effective until sometime in 2009 and 2010.
Now, I am here on the floor to try to get people to understand that
this tax cut for the rich is really to grow the economy, and I want to
make it clear to those people who have lost their jobs and not counted
among the unemployed, those that are looking at automobile plants
closing and airlines going bankrupt, that basically the economy is
good, and it is good because the President told us so. And if they do
not think that we are moving forward fast enough, then they ought to
really listen to the President as he shares with us the great economic
recovery that has happened in Iraq, and if they are just a little
patient, things will get better here in the United States.
Now, we all know that whenever we give this type of tax cut that
there is going to be a tremendous revenue loss, and in the last few
days, that revenue loss has been something like $100 billion. But fear
not, because we are not charging all of this to the deficit. It is true
that as the deficit increases more than history ever expected under
this administration, that soon 40 percent of the tax revenues that we
get will be going just to pay the interest on this outstanding debt,
and that is why our Republican friends believe that we just cannot
expand the deficit, that we have to cut spending.
Now, they have looked all over to the to decide where to do the
cutting. And in this holiday season, I just want to join them in
letting people know where these cuts are going to take place. But I do
not want people to worry about it because the President says that the
economy is booming and the Republicans here say that the tax cuts for
[[Page H11238]]
the rich is for economic growth. So how can one be against that
formula?
First of all, if one is a mother trying to raise her children and she
got support from the local and State government to go after the father,
or whatever the case may be, to get that money to take care of her and
her family, not to worry, that this is going to be cut and she will not
be able to get the money because under this bill, whether people know
it or not, it is for economic growth.
{time} 1145
Say you are considering using food stamps for your Christmas meal.
You find out that the food stamps are going to be cut. Not to worry,
because soon there will be economic growth.
Maybe you are just a student trying to get a student loan, and you
really think that you should get some help from your government
because, after all, we want you to be productive and make a
contribution to society. Not to worry, these tax cuts are for economic
growth.
What I do not understand, with all of the opportunity that we have
had to take care of economic growth, why do we wait until this time of
the season and target the least among us in order to do the budget
cuts?
It is not as though we do not have $2 or $3 billion in terms of
expenses in Iraq, which if you did not know lately, you should know
that victory is in sight and we are winning that too. So we do not want
you to lose confidence in all of government. If you find out that this
bill rewards the richest of the people in the United States whose
income is not going to be adversely affected, or their tax is adversely
affected for 3 or 4 years, but we have to do something to target the
poor today, then you have to have some trust in the Republicans,
because they say we have got to have victory in war, we have got to
grow the economy, and this is the best thing that ever happened to you.
Now, the Democrats are not just saying vote ``no.'' We will have an
opportunity for Members to vote ``yes.'' And unlike the Republicans, we
thought enough of the alternative minimum tax to include it in
reconciliation. What does that mean? It means it is protected when it
gets over to the other side, so we did not have to depend on 100
Senators sitting down and not objecting. It is in our bill. All of the
good things that can come out of a bill, we have included, including
relief for those people that have State taxes.
And so, my friends in this holiday season, you may find it very
difficult if you are unemployed, if you are concerned about the
economy, or the cuts that we have, including Medicaid, which is only a
$10 billion cut, but you must trust the majority and the Republicans in
this House, because they, like the President of the United States, say
the economy is booming. We are going to have victory in the Middle
East, and this is going to make it easier for you, if not today, if not
tomorrow, then sometime in the future.
Mr. Speaker, I reserve the balance of my time.
Mr. THOMAS. Mr. Speaker, I yield myself 30 seconds.
Mr. Speaker, perhaps the gentleman from New York (Mr. Rangel) is not
aware that the Senate has included the alternative minimum tax in their
reconciliation tax package. They have already voted on it. So there is
no need to provide any assurance from the House side, because the
Senate has already included it. But, again, that is reality.
The economy is not good because the President told us so. Leading
economic indicators tell us so: the unemployment numbers, the
productivity numbers. The real problem with my friends on the other
side of the aisle is that if reality does not coincide with their
rhetoric, they choose rhetoric rather than reality.
Mr. Speaker, I yield 2\1/2\ minutes to the gentlewoman from
Connecticut (Mrs. Johnson).
Mrs. JOHNSON of Connecticut. Mr. Speaker, I rise today in support of
the Tax Relief Extension Act. Let me make absolutely clear what this
bill does. The bill will prevent automatic tax increases on millions of
Americans and their families.
Unless Congress acts, individuals will pay higher taxes on their
savings; businesses will lose valuable incentives to provide research
in the United States; small businesses will lose the ability to expense
new equipment, essential to the support of new employees.
These are all benefits taxpayers have today, and our bill simply
preserves them. The bill does not increase taxes. The bill does not
reduce taxes. The bill merely preserves the current tax policy that has
driven 4.3 percent growth and is creating millions of new jobs.
According to the IRS in my home State of Connecticut, there are
550,000 taxpayers who receive dividend income; 153,000 of those have
incomes below $30,000 a year. Right now they pay 5 percent taxes on
dividend incomes. In 2008 low-income taxpayers will pay zero taxes on
dividend income. If we fail to act, however, they will pay taxes as
high as 25 percent.
A widow living on $30,000 a year could see her tax bill increase by
$1,200 a year. That would be wrong. This bill needs to be passed. It
deserves to be passed. It also needs to be passed and deserves to be
passed because it extends and enhances the R&D tax credit. At a time
when other nations are providing or have provided permanent and richer
incentives for research, we need to recognize the job-producing
benefits of this tax credit.
Mr. Speaker, we remain a world leader in patents and discoveries, but
other nations are closing in. Advances in technology and innovation are
what drive growth and ultimately create higher standards of living for
all of us.
We need to ask ourselves, do we want the next major scientific
breakthrough to happen in Germany or China? Do we want other countries
to be the leaders in the patents for the next generation of technology?
Finally, I would be remiss if I failed to mention incentives for
small business expensing. Small business is the engine of our economy.
Our bill allows small businesses to immediately expense up to $100,000
of equipment. When we first adopted this provision, we saw investment
in equipment skyrocket, go right straight up. Lowering the cost of
capital encourages small businesses to invest in machines, trucks, and
other equipment and hire new people. With 25 million small businesses
accounting for two of three new jobs created, expensing supports these
small businesses.
Mr. Speaker, I urge passage of this legislation.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would just like to say briefly, if the chairman of the
Ways and Means Committee is saying that the alternative minimum tax is
in the other body's bill, then he must be saying that the tax cuts that
we are talking about today are not in the other body's bill.
So it is 3-card Molly. The House Republicans passed both of them, one
on the Suspension Calendar that is not protected here, but is protected
in the other body; and this bill which provides for relief for the
taxes for corporate dividends and capital gains, which is protected in
our bill, but is not in their bill.
And so what we are doing is shooting dice to see which one will
prevail.
Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from Washington
(Mr. McDermott).
(Mr. McDERMOTT asked and was given permission to revise and extend
his remarks.)
Mr. McDERMOTT. Mr. Speaker, I got up this morning and here is the
Washington Post's eminent columnist, David Broder. He begins his story:
``If the House of Representatives were a person, it would be blushing
these days. Unfortunately, the House is beyond embarrassment.''
Now, I used this before, but I wanted to bring it out here again
because I think we need to demonstrate to people what is going on. We
have Christmastime, and we have socks. We have poor people's socks and
rich people's socks. And the rich people need $100 billion in tax cuts.
The Republicans, for whatever reason, have decided that it is $100
billion yesterday and today, $100 billion. Now where do you get the
money for that? Well you have to cut somebody to get it. You have got
to cut something, or else you are going to drive up the deficit.
So the first thing you do is take child care away from 300,000
children. And you put that in the sock, the stocking of the rich. And
then you have Social
[[Page H11239]]
Security, SSI benefits for the disabled and the elderly. And you take
$700 million away from them and put it into the rich folks' stocking.
And then you come to child support enforcement. We do not want
children who are in divorced families to get money from those deadbeat
dads. That is not what the Republicans say. They say, let us save $21
billion. We will take it away from the children in divorces and put it
in the rich people's stocking.
And Medicaid. Oh, well, they do not need health care. Why, there is
$10 billion we can take away from poor people's health care and put it
in the rich people's stocking.
And then there is student loans, $14 billion from college students.
We are going to load it on them. That is the middle class. That is the
lower-class people who are trying to get through on loans. We take
their loans and we say, no, no, no, no, the rich people need it.
And then we have one of the best ones of all: food stamps. Let us
take food stamps away from 300,000 people; 300,000 people getting food
stamps. Oh, these are the rich. Oh, but we have to cut them. We have to
take this away from them.
You cannot have food stamps, poor people or ordinary people; we got
to give a tax break to the rich people. And then finally we have foster
children. Way down here in the bottom of the sock. We have $600 million
taken away from the program that we took those children out of another
family and took responsibility for. We have taken these children away
from a family we have accepted responsibility for in this foster care
payment, and we cut it and we give it to the rich folks.
Now, you kind of wonder what might be left down here for the poor
people. Well, look at that. A lump of coal. The poor people better save
that lump of coal, because there is nothing in here for their heating
bills, the LIHEAP program has not been expanded, and all they are going
to have to heat their house is the lump of coal that the Republicans
put in the poor people's sock.
Merry Christmas. I certainly hope you enjoy all the festivities. This
is a bad bill. Vote ``no.''
Mr. THOMAS. Mr. Speaker, I yield 2 minutes to the gentleman from
Wisconsin (Mr. Ryan) to explain to the gentleman from Washington that
it is not a zero sum game that is what has made the American standard
of living.
Mr. RYAN of Wisconsin. Mr. Speaker, I appreciate the gentleman
yielding me time.
I also appreciate the fact that the gentleman from Washington is
willing to acknowledge Christmas here on the House floor. That is a
nice step in the right direction.
Mr. Speaker, let us look at the facts. To hear the other side, you
would think we were taking a chain saw to the budget. What we are
proposing in the budget is that we increase entitlement spending 6.3
percent instead of 6.4 percent, saving $50 billion out of a $14
trillion budget, by rooting out waste, fraud and abuse by reforming
government.
But let us talk about these tax cuts. You would think when we cut
taxes in 2003 we would have lost revenues. Right? That is the intuitive
thing to say. Wrong. That is not what happened. Since the enactment of
the 2003 tax cuts, job losses went away. The unemployment rate was 6.1
percent when we cut taxes. The unemployment rate is 5 percent.
Since we cut taxes, we have averaged a job creation every month of
148,000 jobs. Just last month alone we added 215,000 jobs to the
economy. What happened before we cut taxes? Before we cut taxes, the 2
years before the tax cut, our economy grew at an average of 1.1
percent. How fast is the economy growing since the tax cuts? 4.1
percent. How fast did the economy grow last quarter? 4.3 percent.
Now, Mr. Speaker, what has happened since we cut taxes is we have
reversed the job loss, we have reversed the decline in jobs, and we
have added 4.4 million jobs to the American economy since the 2003 tax
cuts.
What happened to revenues? Revenues increased. Yes, that is right. At
these lower tax rates, at these lower taxes, we increased revenues to
the Federal Government. Last year revenues went up 14 percent. Just
this year individual income tax receipts are up 14 percent. Corporate
income tax receipts are up 47 percent.
What happened to the deficit, Mr. Speaker? The deficit projection in
2004 was $521 billion. What is the deficit now? The deficit projection
now is $319 billion. We dropped the deficit 23 percent last year. We
dropped the deficit 25 percent last year. The deficit is down because
tax revenues are up.
Do not defeat this bill and raise taxes. Let's stop tax increases.
{time} 1200
Mr. RANGEL. Mr. Speaker, I would like to ask the gentleman just one
question on my time.
These very important tax cuts or extension of tax cuts you are
talking about, could you share with me as simply as possible as to when
they expire, what year?
Mr. RYAN of Wisconsin. Each of these tax cuts expire between this
year and the next 2 years. It depends on the tax cut you are talking
about.
Mr. RANGEL. The tax cut that we are talking about is the $20 billion
in capital gains and corporate dividends. Does that not expire in 2009?
Don't get rattled.
Mr. RYAN of Wisconsin. Not at all.
Mr. RANGEL. It is just a simple question. Because there seems to be
some degree of urgency in this and unless it is a projected gift, then
these things don't expire this year or next year.
Mr. RYAN of Wisconsin. If the gentleman will allow me to respond to
his question.
Mr. RANGEL. Please.
Mr. RYAN of Wisconsin. Why is it important that we continue the tax
relief progress that would expire in 2008 on dividends and capital
gains? Because those are job creators.
Mr. RANGEL. I think the gentleman has answered the question. There is
no urgency in this. You just want to give a projected Christmas gift to
the very wealthy. So I need some help on this. If I can't get answers
from you, I will get someone that can give answers.
Mr. Speaker, I yield 3 minutes to the gentleman from Massachusetts
(Mr. Neal) to answer some of these important questions, a distinguished
and acknowledged expert in this on the Ways and Means Committee.
Mr. NEAL of Massachusetts. Mr. Speaker, I just heard the gentleman
from Wisconsin talk about job creation. He singled out one month. 22
million jobs created during the Clinton years. 22 million. Economic
growth has been paltry and everybody knows it. In addition to which he
talked about the deficit--with a straight face. They have rolled up the
national deficit, $2.2 trillion we are in the hole. On their time this
has happened.
Let me say this and I think it is very important to point out, Mr.
Speaker, the Republican majority now says, as they did yesterday with a
straight face, incidentally, well, the Democrats did not do anything
about the alternative minimum tax when they were in the majority. In
1994, and I hope that anybody who is listening to this will write this
number down, when the Republicans took control of the House of
Representatives there were approximately 200,000 people paying AMT,
200,000 people. Next year 19.3 million people are kicked into AMT.
I would like to think, as the gentleman from New York has indicated,
that I have had some consistency on the issue of alternative minimum
tax, not only in the committee, but here on the House floor. We did a
big nothing yesterday about AMT and everybody knows it. 19.3 million
people next year are kicked into AMT. But the House of Representatives
had time to repeal the estate tax and now to address the dividend and
capital gains tax, but they really never have time to do anything about
AMT. And the reason they do not have time to do anything about AMT is
pretty simple, it goes to middle income Americans to bear that burden.
So if we do not have time here to do something for the wealthy, we
really do not have time to do anything. We are rich and we are not
going to take it anymore. We watch these numbers as they are presented
to us. The Republican party, at one time, stood for anti-Communism and
balanced budgets. Well, Communism is gone and the deficits have really
soared, all from a party that preaches fiscal discipline. They have
rolled those deficits up for one reason, after, by the way, robbing the
Social Security trust fund to pay for tax cuts for the wealthiest.
[[Page H11240]]
In this institution we hear, well, the Social Security trust fund is
going broke. It is going broke because they took $2 trillion out of it
in tax cuts during the next 10 years. There is no pressure to do what
we have to do today. They are contributing to the national deficit,
contributing to the debt, all under the guise of paying for tax cuts
for the wealthiest among us.
Lastly, I defy anybody here to not acknowledge this static. The
dividend relief bill that we are entertaining here overwhelmingly 53
percent of that benefit goes to people who made more than $1 million
last year. That is where we find ourselves now.
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume to
ask a rhetorical question.
If the gentleman from Massachusetts (Mr. Neal) voted yes on this
alternative minimum tax bill yesterday he either was protecting the
very rich in Massachusetts.
Mr. NEAL of Massachusetts. Will the gentleman yield?
Mr. THOMAS. No, it is a rhetorical question.
Mr. NEAL of Massachusetts. I am happy to participate.
Mr. THOMAS. Whose time is it, Mr. Speaker?
The SPEAKER pro tempore (Mr. Gingrey). The gentleman from California
(Mr. Thomas) has the time.
Mr. THOMAS. Either he was voting to protect the incomes of the very
rich in Massachusetts or he exercised a futile procedure.
There were four Members of his party who voted no. He had an
opportunity, if he believed it was not real to vote no. He voted yes.
The problem is they always want it both ways.
Mr. Speaker, I yield 2\1/2\ minutes to the gentlewoman from
Pennsylvania (Ms. Hart), a member of the committee.
Ms. HART. Mr. Speaker, I thank the chairman for yielding me time.
Mr. Speaker, I rise in support of H.R. 4297 because this legislation
will ensure that our economy will continue to expand. That is right,
expand.
If you would listen to those on the other side of the aisle, you
would think that we are in a shrinking economy. However, since the
capital gains and dividend taxes were reduced in 2003, we have seen ten
straight quarters of what is it? Growth.
Now, what does growth mean? It means more jobs. It means more
opportunity. I spoke recently with an entrepreneur group back home,
women who started businesses in their homes. Most of them have children
and did not want to be out of the house all the time, very small
businesses. And you know what they said to me their top priority is?
Make sure you extend the capital gains cuts. Make sure you make sure
you pass legislation that will prevent a tax increase.
That is what we are doing today. Preventing a tax increase on these
entrepreneurs who, one by one, are creating new jobs in our economy.
The national economy has produced impressive growth. Our pro-growth
policy will continue only if we do not increase taxes. In the 10
quarters prior to the passage of this legislation, we averaged just 1.2
percent of growth, never exceeded 2.9. In the 10 quarters since, we
have averaged 3.3 percent of growth and have averaged over 4 percent.
Now, I think 4 percent growth is better than 1 percent growth. And if
we do not continue this tax situation and increase taxes, we will see
our growth go away.
What does this mean, this business investment that happens because of
the capital gains reduction, the dividends reduction? It means new
jobs. In a district like mine where we need new jobs, and I know some
Members on the other side of the aisle apparently have more jobs than
they need, we need jobs. This climate is the climate we need for
growth. We have seen, in fact, unemployment go from 6.1 percent down
over 1 point to 5 percent.
Despite challenges that this country has faced over the last couple
of years, including terrorist attacks and natural disasters, we have
still seen an increase of job creation.
Now, if anybody at the end of August and the beginning of September
expected that we would see 215,000 jobs created in the United States in
the last month, I do not think you are telling me the truth. But the
good climate that was created by those cuts made it happen.
We need to continue good policy. We need to realize what good policy
is. Good policy is allowing the people to invest their money, create
jobs, create a strong economy and create job growth. I urge my
colleagues to continue this situation and not allow a tax increase on
the American public.
Mr. THOMAS. Mr. Speaker, I yield the remainder of my time to the
gentleman from Michigan, the chairman of the Select Revenue
Subcommittee, and ask unanimous consent that Mr. Camp control the
remainder of my time.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
There was no objection.
Mr. RANGEL. Mr. Speaker, I yield 30 seconds to the gentleman from
Massachusetts (Mr. Neal) to give a rhetorical response to the
chairman's question.
Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman from
New York (Mr. Rangel) for yielding me time.
The chairman did raise a rhetorical question. Let me give a
rhetorical answer.
We are all so desperate here after these 10 years of Republican rule
to do something about AMT we are prepared to vote for any procedure
that comes before this institution just to hopefully move it along.
Remember, when the Republicans took control, 200,000 people were
paying AMT. Next year 19.3 million people will be paying alternative
minimum tax.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
North Dakota (Mr. Pomeroy), a distinguished member of the Ways and
Means Committee.
Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding.
The preceding speaker on the Republican side said we have got to pass
this, we have got to continue the pro-growth policies. She was talking
specifically as she referenced capital gains and dividends. Well, the
fact is the very tax cuts that she is talking about remain in place.
They are in existing law for 2006, for 2007, for 2008. Doing nothing
keeps the very provisions she was hyperventilating about just a moment
ago.
But what is the matter then? If we got them and we got them through
2008, why not kick them out through 2009 and 2010? This is the reason.
This is the national debt. This fall it went north of $8 trillion.
I brought this chart to illustrate what a huge burden we are racking
up for our children. This averages out to $27,000 of debt per person.
And in this environment, the majority in bringing this bill to the
floor today after yesterday's vote will be passing $87 billion in
additional tax cuts that are not paid for.
Alan Greenspan has got some words of caution on this. He was quoted
in November saying, We should not be cutting taxes by borrowing. Well,
when they do not pay for their tax cuts, they are basically borrowing,
leaving the debt to our children to offset the funding of these tax
cuts, just what Greenspan warns against.
Earlier in the month of December, just last week, he says, An
expected deficit casts an ever larger shadow over the growth of living
standards. In the end, the consequences for the U.S. economy could be
severe.
The dirty little secret in this budget reconciliation plan is that it
increases borrowing authority for this country nearly $1 trillion, from
750 to $780 billion of additional debt they will be authorizing to fund
the tax cuts that they want to commence.
As they talk about growth, don't believe it. They would not have to
increase the borrowing limit to this country if this all worked. They
are adding to the debt to pass tax cuts disproportionately for the
wealthiest.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
Indiana (Mr. Chocola), a distinguished member of the Ways and Means
Committee.
Mr. CHOCOLA. Mr. Speaker, imagine if we could bring a piece of
legislation to the floor of this House that would, over the next 30-
month period of time, result in benefits that every American could
share in. Things like increasing business investments by 25 percent,
growing the value of the stock market by over $4 trillion. Creating 4.4
million new jobs. Reducing the unemployment
[[Page H11241]]
from 6.3 to 5 percent. Having quarterly GDP grow at an average of 4.1
percent. Increase tax receipts by $274 billion over a 12-month period
of time, a 15 percent increase, the largest in 25 years. And decrease
the deficit over that same 12-month period of time by over $100
billion.
Mr. Speaker, it would be hard to imagine that we would not all
support that, but I guess it is not hard to imagine, given the
conversation here today, but that is exactly what this body did when we
passed tax relief in 2003. And today we are simply extending these pro-
growth tax policies that have led to this historic economic growth.
I think, Mr. Speaker, we all understand the benefit of hindsight and
history is full of valuable lessons. I encourage my colleagues to use
the benefits of hindsight and the facts of history to support this tax
relief extension today and the policies that led undeniably to
opportunities of growth and prosperity for every single American.
Because not to do so, Mr. Speaker, is the thing that would be truly
hard to imagine.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas (Mr. Doggett), a distinguished member of the Ways and Means
Committee.
Mr. DOGGETT. Mr. Speaker, when this administration took over the
White House, the United States enjoyed a multi-billion dollar budget
surplus. But a Republican-controlled Congress proved unable to stay the
course. Instead, our public surplus has been surrendered--surrendered
to special interests and their corrupt coterie of cronies.
Every time Big Oil or Halliburton or some other corporation that
shifts its jobs and its profits offshore comes up here and asks for
another tax break, this Congress waves the white flag of surrender. The
commitment to any fiscal discipline is in full retreat. Now we have
huge deficits as far as the eye can see.
{time} 1215
At a time of war, Republicans demand no sacrifice from those at the
top, no sacrifice from multinational corporations; and they demand that
those at the bottom sacrifice their all.
Under this bill, the few individuals making over $1 million per year
are rewarded, on the average, with over $50,000 in tax breaks. So those
at the top, they can add another fancy foreign car to their fleet. But
for the many who are earning up to $40,000 a year, that is over half of
the people of the United States, they get an average of $30, maybe
enough for a full tank of gas.
Once again, America sees that a true Republican Christmas is one
where only the silk stockings get stuffed. And when the bill for this
lavish Christmas give-away comes due, who is going to pay? Our children
will pick up the tab in the form of endless national debt and with cuts
to child care, cuts to assistance to abused and neglected children,
cuts to child support enforcement, and cuts to student financial
assistance.
The tax-writing body in this Chamber has truly become the ``Committee
on Greedy Ways and Shifty Means.'' And this will be remembered as the
``Cut-and-Run'' Congress, cutting taxes greatly for the few, while
running trillion-dollar deficits for the rest of us.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
Pennsylvania (Mr. English), a distinguished member of the Ways and
Means Committee.
Mr. ENGLISH of Pennsylvania. Mr. Speaker, today we have the
opportunity to pass a bill that I believe will provide a powerful tonic
for continued economic growth as a precedent for social justice.
Since 2003, when much of the current tax policies were enacted, our
GDP has seen its fastest growth in 20 years, averaging a robust 4.4
percent growth per quarter. This growth, Mr. Speaker, is attributable
in part to reduced rates on capital gains and dividends.
I would like to highlight who in the real world is receiving these
reduced rates and, therefore, whose taxes we will be raising if we fail
to extend these existing policies.
Mr. Speaker, 54 percent of those families receiving dividend income
had incomes of less than $75,000, and they received an average of
$1,400 in dividends. Today, families with incomes under $100,000 have
more than $20 billion in dividend income. In 2005, an estimated 10.3
million families in the 10 and 15 percent tax brackets will save on
their taxes because of the existing tax policies.
So the rhetoric that this tax relief only benefits the wealthy is
vacant, ideological posturing.
To let these rates expire would simply be a tax increase on the
productive sector of the American economy. Not only would the lapse of
the reduced rates impose a tax increase; it would particularly
discourage equity ownership among working families, among whom we have
seen a 91 percent increase in stock ownership.
To turn back the clock on our tax policies that have benefited
American workers and encourage more American workers to own a stake in
their future is simply the wrong thing to do.
Mr. Speaker, those who oppose this legislation are asking for a
perverse tax increase on the seed corn of our economy and are
suggesting that we impose a drag on economic growth at a time when we
need it the most. We cannot afford not to pass this legislation today
if we are serious about growing our economy.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
California (Mr. Thompson), a distinguished member of the Ways and Means
Committee.
Mr. THOMPSON of California. I thank the gentleman for yielding.
Mr. Speaker, just 2 weeks ago, the majority came down to the floor
and cut $50 billion from services for middle-class workers, students,
hungry children, farmers, and single moms. Today, they are back with
part two, pushing almost $60 billion in tax breaks for Americans who
need help the least. Sadly, they are trying to peddle this as deficit
reduction.
Mr. Speaker, you cannot spend $10 billion more than you cut and call
it deficit reduction. Our constituents know that these numbers do not
add up, and they also know that these priorities do not add up.
This bill grows the deficit, and it turns a blind eye to the tax
increase the middle class will face in just another 23 days. That is
when the relief for the alternative minimum tax, or the AMT, expires.
If AMT expires, 16 million new families will start paying this tax next
year. That is a tax increase.
This is an issue that hits home for my constituents. California is
hit harder by AMT than any other State in the country. Almost a quarter
of the revenues that come from the Treasury from AMT come directly from
California. If AMT relief is not extended, that number will increase.
This legislation extends tax cuts that are not even close to
expiring, cuts that are on the books for another 3 years. It changes
more than 25 different tax provisions; but somehow, our friends in the
majority could not find room for AMT relief: 16 million new families
impacted, 23 days until expiration, zero regard for the middle class.
I urge my colleagues to vote against this irresponsible legislation
and support the Rangel substitute. The substitute extends immediately-
expiring tax provisions, and it protects our middle-class families from
AMT.
Mr. CAMP of Michigan. Mr. Speaker, I yield 2 minutes to the gentleman
from Florida (Mr. Shaw), a distinguished member of the Ways and Means
Committee and chairman of the Trade Subcommittee.
Mr. SHAW. Mr. Speaker, I thank the gentleman from Michigan for
yielding me this time.
I have been listening to the debate here on the floor. I have yet to
hear anybody from the other side say that the reduction in capital
gains does not stimulate the economy or say that any of these items are
bad for the economy.
All we have heard from the other side is class warfare, who is
getting what. Well, I can tell you who is getting what, and we can go
down this thing.
My folks in Florida want to be able to deduct State and local sales
taxes. What is wrong with that? People in New York, they can deduct
their income tax. So why can Floridians not deduct their sales tax and
other States?
Research and experiment tax credit, who can be against that? It keeps
us sharp and competitive in the world market.
[[Page H11242]]
Above-the-line deduction for higher education expenses. Are we
against allowing people to deduct their education expenses?
How about an above-the-line deduction for out-of-pocket teacher
classroom expenses, are you against that?
All we are hearing about is, well, why are you doing it for capital
gains and how this is going to affect the top people, the people right
at the top of the income level. I would like to point out who is going
to benefit from the reduced rate on dividends.
Nearly 60 percent of the Americans receiving capital gains or
dividend income have incomes of less than $100,000; and believe me,
that is not millionaires, and you can even take it down to $50,000 and
find one in five will benefit from the capital gains deduction because
of incomes under $50,000. Those are not millionaires, but let us get
down to talk about why we are doing it now.
If we were to allow the capital gains rate to expire and jump back up
and increase, what we are simply doing is pushing back the increase so
they do not increase. This is very important, and it is important for
capital formation. It is important for planning your life and future
and what you are going to be able to do; and also, I think that it is
just good sense. It is good for our economy. Our economy has grown
under this structure, and let us let the economy continue to grow.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
I am so glad to hear my friend from Florida talk about the economic
growth that we can expect by making certain that the capital gains tax
cut and the corporate dividend tax cut do not expire. What bewilders
most people is that this does not expire until 2008. Nobody would be
adversely affected until 2009, and unless the gentleman does not
believe he will be in the majority in the next few years, I do not see
why he would have to say that people who are out of work, who are
looking for work, who have lost their pension should believe that this
tax cut that will continue to 2009 is going to help them.
But maybe the gentleman from Mississippi, who understands that not
many of his constituents are going to understand this, might clarify
some of the problems we have.
Mr. Speaker, it is my pleasure to yield 3 minutes to the gentleman
from Mississippi (Mr. Taylor), who really knows what economic growth
should be.
Mr. TAYLOR of Mississippi. Mr. Speaker, I thank the gentleman for
yielding me time.
Last night, about 12,000 Mississippians went to bed in somebody
else's house or in their carport or in their car or in their tent. They
are waiting on a FEMA trailer. I did not promise them a FEMA trailer.
The President of the United States did. He has not fulfilled that
promise yet. It is over 102 days past the storm.
As we speak, there are tens of thousands of Mississippians, average
Joes, who are about to lose their house. See, they lived outside the
flood plain. They had wind insurance, and a storm of magnitude that has
not occurred in 300 years either destroyed or flooded their homes.
Now they have no home. They have a mortgage to pay, and their
insurance company, which contributes heavily to the folks over there,
says you are not getting a dime because that was water and not wind,
but they will use any excuse they can.
I have introduced legislation to try to help those folks, and it is
expensive. It is going to cost about $5 billion to help those folks
hang on to their homes and hang on to their mortgage; and in 102 days
we have not had a hearing or a vote on it. But if you are a member of
the political contributor class, the guys who write the big checks to
the RNC, guys who write a big check to a Congressman here, Senator
there, we have got a vote on your tax cut that does not even expire for
3 years.
You want to know what this House's priorities are? It is not with the
average Joes. It is with the political contributor class. You call them
what you want. You can call them rich, but we all know it comes down to
who writes the checks.
By the way, the guy on Coleman Avenue whose house washed away, he
does not write big checks. So maybe that is why you do not listen to
him. It has been 102 days, and you have done nothing. There is no talk
of doing anything.
There are 12,000 Mississippians waiting on a FEMA trailer. So what do
you bring to the floor? Is it hurricane relief? Is it something to help
the average Joes? It is a tax break for the wealthiest 1 percent of
America who, by the way, write the big checks to the political parties.
Tell me your priorities are not screwed up, because I am going to tell
you they are.
Mr. CAMP of Michigan. Mr. Speaker, I yield myself such time as I may
consume.
I just want to point out to the Members that yesterday the House
passed the Gulf Opportunities Zone Act 415-4 which dealt with many
items to help gulf coast area residents who had been hurt by the
hurricane, incentives to help rebuild housing, investment to provide
depreciation and expensing for small businesses, bonding authority so
that tax-exempt bond authority could help rebuild devastated
infrastructure in the hurricane zone.
So this House has acted to help hurricane victims.
Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Arizona
(Mr. Hayworth), a distinguished member of the Ways and Means Committee.
(Mr. HAYWORTH asked and was given permission to revise and extend his
remarks.)
Mr. HAYWORTH. Mr. Speaker, I rise in strong support of the
legislation precisely because of the challenges outlined by my friend
from Mississippi.
As my friend from Michigan just pointed out, yesterday this House
took steps to reignite the engines of economic opportunity, to deal
with job creation and getting help to the people of the gulf coast. I
would assure this House, Mr. Speaker, this is not some sort of
abstraction.
As my friend from Mississippi knows, Brother Rex Yancey, the pastor
of First Baptist Church in Pascagoula, is my wife's uncle. This is not
some sort of statistic or abstraction. Just as Brother Rex and everyone
in Mississippi and on the gulf coast are facing challenges, we need to
work together to make sure the climate of economic opportunity exists
for all.
Just as heartfelt as his concern is for his constituents, Mr.
Speaker, I must correct the record. It does this House no service to
come to this well, no matter the challenges confronted, and try to
claim either class warfare or crass political opportunism in a quid pro
quo. It is beneath the dignity of every Member of this House to suggest
that somehow this has to do with contributions.
As my friend from Mississippi knows, the most philanthropic State in
the Union where people step up to help neighbors in need, that example
does not fall on deaf ears. I will say economic opportunity is
important, not only for Wall Street, not only for Main Street but for
your street, Mr. Speaker, for every street because we understand
economic opportunity is not exclusive.
There may be some who believe that this modern economy is some sort
of caste system. There may be some who always want to fill in the blank
as follows: tax breaks for the blank, tax breaks for the rich. That is
their story and they are sticking to it. No hope, no opportunity when
the facts are otherwise.
We have had solid economic growth. Revenues to the government have
actually increased.
{time} 1230
And not only has there been some $69 billion in immediate hurricane
relief given by this Congress and this government to the storm victims,
but the promise of future help and economic prosperity as the people of
the gulf coast get back on their feet.
Stand up for growth and opportunity. Pass this legislation.
Mr. RANGEL. Mr. Speaker, I had an old law professor, and he once told
me, if you don't have the facts going for you, raise your voice. I
never understood it, but I do now.
Mr. Speaker, I yield 30 seconds to the gentleman from Mississippi
(Mr. Taylor) to share with us what economic growth means to him under
this bill.
Mr. TAYLOR of Mississippi. Mr. Speaker, I want to remind the
gentleman that when your house is washed away, your job is washed away.
You are not looking for a tax break. You are looking for your fellow
Americans to
[[Page H11243]]
help you out while your kids are serving in the Mississippi National
Guard over in Iraq.
You have not done that for 102 days.
Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from
Illinois (Mr. Emanuel), a distinguished Member of the Ways and Means
Committee.
Mr. EMANUEL. Mr. Speaker, I rise today in strong opposition to this
Republican plan for the wealthiest Americans.
President Kennedy once said, ``To govern is to choose.'' So let us
look at the choices. This tax cut falls on the heels of a deficit
reduction plan passed before Thanksgiving that cut children's health
care, child care assistance, college aid, child support, and will
actually increase the deficit by $20 billion. That is what they refer
to as new math in America.
What kind of Congress calls this fiscal responsibility? A Republican
Congress, but of course.
With all the problems facing middle-class Americans, soaring energy
costs, coupled on top of skyrocketing health care costs, educational
expenses, and flat incomes 5 years in a row, what is the solution
offered by this Republican Congress? Cut capital gains and dividend
taxes for millionaires.
It is time for a change in new priorities rather than that same old
tired failed policies that got America to where it is today.
This budget cuts $9.5 billion, adversely affecting $6 million
children's health care. It cuts 40,000 children from nutritional
assistance. It cuts child care assistance leaving 330,000 children
without child care assistance. It cuts $14.5 billion from student aid
and college assistance. It cuts child support collections $4.5 billion.
This budget gives a whole new meaning to women and children first.
And what do they do in return? Fifty-three percent of the benefits of
this tax cut on dividends and capital gains goes to people earning $1
million or more, and 62 percent of the benefits go to those earning
$500,000 or more.
What kind of Congress would throw children over the side to pay for
more tax cuts for the wealthiest Americans? A Republican Congress, but
of course.
These are the wrong priorities for America. We can do better. It is
time for a change and for a new direction.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
Colorado (Mr. Beauprez), a distinguished member of the Ways and Means
Committee.
Mr. BEAUPREZ. Mr. Speaker, this has been an interesting debate, as it
always seems like it is these days in this House. In 2003, I actually
thought we did some very good things with the tax cuts we implemented,
and I thought we did them for families back home in all of our
districts. So on August 2, 2005, I joined with a colleague of mine from
Colorado, Congresswoman Musgrave, a member of the Small Business
Committee, and we explored the effect of at least one of those tax cuts
that we are talking about extending today, section 17, which increases
the allowable expensing limits from $25,000 on depreciable assets to
$100,000.
Now, I think Linda Jones, the owner of Area Rentals back in
Westminster, Colorado, will be delighted to understand that she is a
member of a special interest and must surely be rich, by definition,
because she got a tax break. What she did with that was, in 2003, she
used $57,000 of the allowable expensing limits to purchase some
additional equipment that she rents in her store. And because she saved
a little over $7,300 in tax expense, and that came the same year she
got a 30 percent increase in her employees' health care costs, she was
able to maintain coverage for health care for her employees. The very
next year she used an additional $64,000 of the expensing allowance to
purchase even more equipment to expand her store, keep jobs, and, in
fact, increase jobs.
Ron Lautzenheiser must be among the rich and the special interests,
too, except he runs a big old tire center back in Fort Collins. When he
did his calculations, wanting to expand, the increase in expensing
limits contained in section 179 allowed him to figure out how to do
that. He added two new stores and went from one big old tire center
employing but a handful of people to now employing 50 people in three
stores.
This is commonsense legislation for the real people back home, and I
urge its adoption.
Mr. RANGEL. Mr. Speaker, I reserve the balance of my time, having
only one speaker remaining, until the other side reaches that point.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
California (Mr. Herger), a distinguished member of the Ways and Means
Committee and chairman of the Human Resources Subcommittee.
Mr. HERGER. Mr. Speaker, today's legislation contains a number of
important tax relief provisions, including an expanded research and
development credit to keep American innovation competitive; and one
supported by my friend from Wisconsin, Paul Ryan, which would adjust
the qualified veterans mortgage bond program and expand access to
affordable home loans for California veterans who served after 1977.
In addition, the bill before us includes a measure that I have long
supported to facilitate greater small business growth. Small businesses
are the backbone of our economy, representing over half of all jobs and
economic output. The section 17 extension in this bill will enable
small businesses to write off new capital investment up to $100,000 per
year, spurring further economic growth and helping to generate new
jobs.
In 2003 alone, 4.6 million small businesses used $44.1 billion of
section 179 expensing. According to the National Federation of
Independent Businesses' November report, 61 percent of small business
owners reported capital outlays over the past 6 months, including new
equipment and vehicle purchases, furniture purchases, existing facility
expansion, and improvement in new facility construction.
Small business expensing works and it helps drive job creation in
areas like my own northern California Congressional District.
Unfortunately, the current expensing limits are set to return to
significantly lower levels if we do not extend this provision.
Mr. Speaker, I would like to thank Chairman Thomas and the members of
the committee for their support of small businesses, and I urge my
colleagues to vote for the legislation before us today.
Mr. RANGEL. Mr. Speaker, I continue to reserve the balance of my
time.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
Illinois (Mr. Weller), a distinguished member of the Ways and Means
Committee.
Mr. WELLER. Mr. Speaker, I thank the gentleman for yielding me this
time, and for his leadership on this issue as well as many others.
It is good to be in the House doing something that is pretty basic. I
support this legislation. I would note that if you vote ``no,'' you are
actually voting to increase taxes because this is legislation simply
extending current law that expires in the coming year.
I also want to point out a provision that is very, very important in
districts like mine, in areas like the Chicago suburban area, because
it is legislation that addresses the need to revitalize old urban
areas, to recycle, and to use old abandoned industrial sites. That is
the brownfields provision.
I have worked over a number of years with Chairman Thomas and others,
and we have worked in a bipartisan way, to find ways to encourage
reinvestment in old abandoned industrial sites. You will find, in many
cases, that these old industrial sites have environmental
contamination, and because of that investors would much rather go out
and buy a cornfield, a greenfield site, and create an industrial park,
which consumes five to six times as much land, creates urban sprawl,
and also costs the taxpayers more because you have to replace the water
and the sewer and the infrastructure and the roads.
Well, in the coming year, the environmental cleanup provision for
brownfields, that tax incentive, expires. So we extend that. But we
also do something more, which I think is very, very important. And,
really, the recent occurrence of Katrina highlights it, because we have
often heard about the petroleum contamination in the New Orleans area
and the need for cleanup. Well, if you think of your own communities
and the south suburbs of Chicago and rural areas that I represent, we
can always think of that gas
[[Page H11244]]
station on a corner that has been closed for 20 years and which sat
abandoned, with no one buying it.
And if you ask the local real estate people or the local economic
development people why, they say, well, they had some petroleum
contamination there. If somebody buys it, they have to pick up the
cost. It does not qualify for the LUST program. So the investor who
purchases that old abandoned gas station has to pick up the cost.
With this legislation, we expand the brownfields tax incentive to
include petroleum. So whether it is oil factories, gas stations,
transportation hubs, or rail yards, we give that opportunity to
recycle, renew, and revitalize.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas
(Mr. Sam Johnson), a distinguished member of the Ways and Means
Committee.
Mr. SAM JOHNSON of Texas. Mr. Speaker, I am pleased to rise today in
support of this bill and the resilient American economy. This act will
build on our legacy of tax relief that is fueling our economy, and will
extend some very important tax provisions that will keep America's
economy moving forward.
Freedom and free enterprise go hand-in-hand. And keeping tax rates
low so people have more of their hard-earned money in their pockets is
the right way to go.
Texans want, need, and deserve to have their sales tax deduction
extended. It is vitally important for Texas. In Texas, we like to say
``no new taxes.'' We finance our spending through a sales tax. In 2004,
we made sales taxes deductible from Federal taxes again, but that
deduction expires in just a few weeks. My constituents want to keep the
sales tax deduction. This bill will allow any American to choose to
deduct either State sales tax or their State income tax through 2006.
That is a great idea.
Next, this bill extends the popular research and experiment tax
credit. Luckily, we fine-tuned it to make it work even better. Many
companies in our districts will be able to use this new alternative
simplified credit. They will be able to add good research and create
new jobs because of it. This extension and expansion of the credit are
great for American jobs and our economy.
Finally, we must extend the tax rate reduction on capital gains and
dividends. This pro-growth policy helped spark the economy that we are
seeing today. People and companies need to have some certainty for
making decisions about long-term capital gains and dividend policy.
Forcing folks to work with short-sighted tax policy just does not make
sense. We have to change that if we want to see our economy stay the
course.
Mr. Speaker, I am proud to support this bill and urge my colleagues
to support it.
Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from Ohio
(Mr. Turner).
Mr. TURNER. Mr. Speaker, I support H.R. 4297, the Tax Relief
Extension Reconciliation Act, which provides extensions for incentives
for brownfields remediation, a vital tool for national economic growth
and for our Nation's cities. I want to echo the comments of my
colleague, Jerry Weller, and applaud his efforts for supporting the
remediation of brownfields.
Brownfields are found in every State and in every Congressional
District. Estimates range from 500,000 to 1 million brownfields sites
across the Nation, covering roughly 400,000 acres.
Private investment is essential for urban growth. The expensing
extension is a tool businesses can use to invest in urban
redevelopment. In fact, it is estimated that brownfields redevelopment
could generate as much as $1.2 billion annually in new tax revenue for
American cities.
{time} 1245
Brownfields are a major concern to America's cities, and we must
provide as many incentives as necessary to clean up these contaminated
sites, bring businesses back into our cities, and continue strong
economic growth. This extension is an important first step toward
redeveloping our Nation's brownfields, but much work is yet to be done.
I urge my colleagues to support this important issue and vote in favor
of H.R. 4297.
Mr. RANGEL. Mr. Speaker, I yield for a unanimous consent request to
the gentleman from American Samoa (Mr. Faleomavaega).
(Mr. FALEOMAVAEGA asked and was given permission to revise and extend
his remarks.)
Mr. FALEOMAVAEGA. Mr. Speaker, I include my remarks on deliberations
on this bill.
Mr. Speaker, as a matter of public record, I wish to thank the
Honorable William Thomas, Chairman of the House Committee on Ways and
Means, for his unwavering support in saving the jobs of more than 5,000
tuna cannery workers and the economy of American Samoa for future
generations. Chairman Thomas is a true friend of our people. He stood
with us during the Andean Trade debate and he is standing with us again
on an extension of 936 tax credits for American Samoa until such time
as a more long-term solution can be put in place once the GAO and Joint
Committee on Taxation complete their reports regarding the impact of
Federal tax policy in the insular possessions.
I also thank the Honorable Charles Rangel, Ranking Member of the
House Committee on Ways and Means. Congressman Rangel is also a friend
of American Samoa and has championed our cause on each and every trade
agreement that has come before the U.S. Congress. He also supports our
extension of 936 tax credits for an additional year.
At a time when our Nation is faced with paying for the war in Iraq
and helping the victims of Hurricane Katrina, I know the inclusion of
American Samoa in H.R. 4297 was no easy task. I also know it was no
easy task for my Democratic friends to allow this amendment to be
included when on principle there is disagreement about tax cuts and
government spending.
While I appreciate the concerns we share and respect the fundamental
differences between us, the possession tax credit offered by section
936 of the Internal Revenue Code of 1986 has encouraged two U.S. tuna
canneries which employ more than 5,150 people or 74 percent of the
workforce to remain and invest in American Samoa. More than 80% of
American Samoa's private sector economy is dependent either directly or
indirectly on these canneries and a decrease in production or departure
of one or both of the two canneries in American Samoa could devastate
the local economy resulting in massive layoffs and insurmountable
financial difficulties.
For this reason, I again thank the Chairman and Ranking Member and my
Republican and Democratic friends for working with me to include an
extension of 936 tax credits for American Samoa in H.R. 4297. Only 27
provisions were included and most tax credits were only extended for a
year due to budgetary concerns and, in the case of the possession tax
credit, pending reports which will guide the Committee next year.
Again, given how serious this issue is for American Samoa, I urge
support of H.R. 4297 and I thank the Chairman for supporting my request
to include language in the conference report to provide for the
development of a comprehensive long-term policy for American Samoa once
the GAO and the Joint Committee on Taxation complete their reports.
Mr. RANGEL. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, we have now come to the conclusion of this debate, and I
want my colleagues to know that if you are looking for some of the
things that are worthwhile that are in the majority's bill, we have an
opportunity in the substitute to take care of it. But if you really
believe this is the time for America to give a $20 billion tax cut to
these people who will not be affected until 2009, why would they want
to give this incentive to less than 5 percent, 1 percent of the richest
people that we have in our country, and do it in this Christmas season?
So you have an alternative. You can take care of the wealthy in years
ahead, since this does not expire this year, or you can do what they
have not done and that is to take care of those people who find
themselves subjected to an alternative minimum tax only because the
majority has not seen fit to give them relief in a decade. And so as
this number has increased, instead of taking care of them in the bill
that is before us, they have decided to just send a message over there
to tell the Senate if you would like, by unanimous consent, and if no
one objects, then you can take care of the AMT problem.
We do not do this as Democrats. We take care of it up front. We take
care of the military, we take care of those people from Hurricane
Katrina, and we take care of the job credits that are important. We
take care of those things that are important in our substitute.
In this holiday season, we really do not believe that you ought to
take $10 billion out of health care for the poorest people in this
country. We do not
[[Page H11245]]
believe that you should, in order to pay for this bill, that you should
cut food stamps. We do not believe that students that have been getting
help from this great government of ours should be adversely affected to
pay for this tax cut.
So we ask you to really consider in this holiday season these
families that have kids in foster care, these families that are having
their benefits not being received because we are letting them down. You
just weigh this and ask, is there any equity involved in this? If you
want to give these tax cuts, why do you not wait until the thing
expires? Perhaps we will have a new Congress. Perhaps there will be new
equity. Perhaps it can be discussed. Perhaps the committee members,
Democrats and Republicans, would come together and find out not what is
just good for the wealthy, but what is good for the strength of this
great Nation of ours.
One of the greatest threats to our national security is poverty. One
of the greatest threats to our national security is the inability to
get an education. The people who died in Hurricane Katrina did not die
because of their color. The hurricane was color blind. But they died
because they were poor. Why can we not invest and make certain that all
Americans, black and white, Republicans and Democrats, can this holiday
season say Congress did the right thing and not the political thing?
Mr. CAMP. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, the bill before us today extends important tax relief
for families and small businesses all across this country. Much of the
relief in this bill is already in current law and will expire next
month. If we do not pass this bill, Americans will be hit with tax
increases.
The tax relief in this bill goes directly to the issues of poverty
and education that the gentleman from New York mentioned. This bill
will allow America's teachers to receive tax deductions on out-of-
pocket classroom expenses. Students will be able to use tax incentives
to enhance the affordability of higher education. Employers will be
eligible for incentives for hiring low-income Americans transitioning
from welfare to work, getting on that first rung of the economic
ladder, and States and local governments will continue to be able to
qualify for tax credit bonds to help repair schools, purchase school
equipment and train teachers in economically distressed areas.
These are just a handful of the important tax benefits this bill will
provide to low- and middle-income Americans and small business owners.
This bill is also a big win for our Nation's economy; and without a
strong economy, we will not see families achieve the kind of economic
independence they need to realize the American Dream. This bill
reauthorizes and strengthens the research and development tax credit
amendment which passed the committee with a unanimous vote. It is a
valuable tool in promoting U.S. businesses to innovate.
When I hear about distressed manufacturers in Michigan, one of the
main issues they are competing on is to innovate and find the newest
technology to remain competitive in a global economy. Michigan's
economy, my home State, is closely tied to the ability of Michigan
companies to make a sustained commitment to long-term, high-cost
research. The manufacturing sector in the United States is the highest
user of the research and development tax credit. Michigan, for example,
is one of the top 10 States in reported research and development
activity with more than 1,300 companies performing research and
development in that State.
This bill is a positive piece of legislation across the board. It
helps small and low-income businesses and working families, as well as
helps our manufacturers to rebound, and also our high-tech community to
stay competitive in a global economy. I urge my colleagues to support
this legislation and vote ``yes'' on the bill.
Mr. LARSON of Connecticut. Mr. Speaker, I rise in support of the
Democratic alternative to H.R. 4297, Tax Relief Extension
Reconciliation Act that would provide real tax relief to working
families and help the economy grow.
The underlying bill is more of the same--more fiscally irresponsible
policy. The President's policy of ``stay the course'' is not working;
it's not working in our foreign policy, domestic policy, budget policy
or tax policy. More of the same is just not working and now is the time
for a new direction.
Unlike the reckless tax bill on the floor, the Democratic alternative
would help more Americans help themselves and ensure that as a country,
we move forward together. Among other things, the Democratic measure
would exempt every family making less that $200,000 from the
Alternative Minimum Tax (AMT). The Democratic measure would also
provide $42 billion in targeted tax cuts including, deductions for
state and local retail sales taxes, deductions for college tuitions
expenses, a research and development tax credit, a small business
expensing tax credit, and a larger earned income tax credit for the
families of those serving in Iraq. Most importantly, the Democratic
alternative would be fully offset instead of pushing the country
further into debt like the Republican bill.
The truth is that more than one-half of all taxpayers would get less
than $30 in tax relief from this bill, while those who make over a
million dollars a year would get an average tax break of $32,000.
Supporters of the capital gains and dividends tax cuts have tried to
characterize them as offering benefits that are more broad-based than
AMT relief. However, in reality, households with incomes between
$100,000 and $500,000 would receive 87% of the benefit of AMT relief,
compared to 62% of the benefit for capital gains and dividends tax
cuts.
Where are the priorities of this House? What message are we sending
to the American people? It's time for a new direction because more of
the same failed policies aren't working. Americans deserve better. I
urge my colleagues to join me in rejecting the underlying bill and
supporting the Democratic alternative that would provide real tax
relief and strengthen our country.
Mr. STARK. Mr. Speaker, I rise today in strong opposition to H.R.
4297, yet another tax break for the richest among us at the expense of
those who have the least.
The Republicans want to cut taxes by $94.5 billion. How do they pay
for these cuts? Before Thanksgiving they voted to cut $50 billion from
programs that help the poorest Americans. The conclusion is obvious:
They are paying for the tax cuts for wealthy Americans by cutting
programs for working Americans.
Under the tax break package presented today, a family of four
surviving on $30,000 a year will get an average of $50 extra in their
tax return next April. Meanwhile, a millionaire will gain an extra
$51,000.
Lets just see what kind of lifestyle enhancement these tax cuts can
buy:
The $30,000 working family of four can use the extra $4.16 they
receive each month to buy any one of the following: 1.75 gallons of
gas; a half-pound of cheese; one gallon of orange juice; two loaves of
white bread; three grapefruits; or for those indebted to the NRA, 6
bullets for a .44 Magnum.
People making over $1 million get a tax break of $4,250 a month, that
they could use to purchase one of the following: leases on four BMW
750i sedans; 17 iPod nano's; a 50 inch flat screen plasma TV; a five
karat diamond tennis bracelet; or a 10-day European cruise. Or, if they
wanted to, they could pay the monthly health insurance premiums for
four families.
If the Republicans want to cut taxes, they should pay for it. We
could save billions by pulling our troops out of Iraq. That could pay
for Katrina relief and stop cuts to important programs for working
families. Instead of handing out holiday tax breaks to rich Republican
campaign donors, we should be rolling back Bush's tax breaks for
millionaires to better fund important programs like Medicaid and
student loans.
Also, Republicans need to drop the ``fiscal conservative'' moniker.
These tax breaks combined with last month's cuts on programs for those
in need will rack up $44 billion in new debt. The fiscal disciplines of
the Republican party apparently means we drive our nation into debt and
send the bill to our children and grandchildren.
The numbers don't lie. The Republican priority is tax breaks for the
rich, nothing more. They will cut programs for the poor and increase
the deficit by billions of dollars to get their way. I urge all my
colleagues to stop this insane fiscal policy by voting ``no'' on this
bill.
Ms. JACKSON-LEE of Texas. Mr. Speaker, we have before us a very
important piece of legislation, H.R. 4297, the Tax Reconciliation Act.
It is very important to understand this piece of legislation within the
big picture the Republicans are painting here. Just last month, the
Republicans passed a bill called ``The Deficit Reduction Act.'' This
was a spending cut bill that slashed funding to many vital programs my
constituents depend on, including to Medicaid, student loans, food
stamps, and child support programs. The Republicans lectured us on the
need to make sacrifices to control the national debt. By passing the
spending cut bill, the Republicans
[[Page H11246]]
actually asked the poor, the downtrodden, the disabled and the young to
sacrifice on behalf of the rest of the country.
Now we are faced with the Tax Reconciliation Act, which will actually
add $86 billion dollars to the deficit over the next 5 years. This
proposed tax cut will not help the poor and middle class, either. An
estimated forty percent of the tax cuts will go to families with
incomes of $1 million or more, and 84 percent of the major tax cuts in
this bill will go to the richest 20 percent of families.
In fact, under this bill, over 17 million middle class Americans will
face a tax increase next year from the Alternative Minimum Tax (the
AMT)! An important aspect of this bill is the House's failure to
adequately address the AMT. The Alternative Minimum Tax was enacted
over 35 years ago to ensure that the richest Americans would pay their
fair share of income tax. Unfortunately, when the AMT was enacted,
Congress neglected to index the tax rates to inflation. The AMT has now
begun to add an extra burden to middle class taxpayers at an alarming
rate. The senate bill provides $30 billion for AMT relief to the middle
class, while the House Republican leadership could only find $2.8
billion for this cause.
Republicans couldn't find the money to adequately pay for AMT relief
for the middle class. They can't find any money for tax relief for
those affected by hurricane Katrina in the Gulf Coast. Last month, the
Republicans couldn't find the money to spare the elderly from Medicaid
cuts, to spare the students from loan increases, or spare our children
from child care cuts. They couldn't find the money because they are
choosing to extend the dividend and capital gains tax cuts for the
richest in our country.
This is not how we take care of our own in Texas, and this is not how
we do things in the United States. The Republicans are launching an
unabashed attack on the American way by ignoring the neediest in our
country to give tax cuts to the richest.
Mr. Speaker, the decision to vote up or down on this legislation
isn't a blurry line involving political ideology; it isn't a debate of
Republican vs. Democratic philosophy. The priorities in this bill are
misguided. Congress should not be providing additional tax breaks for
the rich less than a month after huge spending cuts aimed at the most
vulnerable. Congress should not be providing tax cuts for the rich in a
time of war! In the end, this tax bill will either exacerbate our
already large federal deficits, or will force even deeper cuts in
critically important domestic programs. I am strongly opposed to this
legislation, and I implore my colleagues on both sides of the aisle to
vote against these unreasonable cuts and instead consider the revenue
neutral Democratic alternative.
Mr. BACA. Mr. Speaker, I ask unanimous consent to revise and extend
my remarks.
Mr. Speaker, this bill is easy to describe--tax cuts for millionaires
and tax increases for the middle class. This bill misses the biggest
tax cut priority of this Congress--the alternative minimum tax, or AMT.
The AMT was designed to prevent the wealthy from avoiding Federal
taxes by taking too many exemptions, but it was never adjusted for
inflation. Therefore, many middle-class American families are being
affected and penalized.
Yet, instead of solving the problem of the AMT and helping middle
class families, this bill only focuses on helping the rich get richer
by extending capital gains and dividend tax cuts that don't expire
until 2009!
This tax cut means that taxpayers with incomes below $40,000--the
majority of taxpayers--will get about one percent of those cuts, an
average of $3 a year. Those with incomes above $1 million--one in 500
households will get 53 percent of the cuts, an average of $38,000 per
year.
Mr. Speaker, even by this Republican Congress' standards, this tax
cut legislation is insulting. And because this bill will add $1.9
trillion to the deficit it is doubly so.
That is why I support the Democratic alternative that would instead
fix the AMT for couples making less than $200,000 per year, reducing
middle class taxes instead of increasing them. Further, the Democratic
alternative would be fully paid for by slightly reducing recent tax
cuts for those making more than $1 million per year. America needs
fiscal discipline like we had during the Clinton years. The $5.6
trillion surplus projection from 2001 is now a $3.5 trillion deficit--a
swing of $9.1 trillion!
Tax cuts to millionaires have dropped revenues from 20.9 percent of
the GDP in 2000 to just 16.3 percent, while spending has increased 1.4
percent.
Mr. Speaker, the Blue Dog Coalition has the message right--we need to
restore fiscal discipline. Defeating this bill would be a good first
step.
Ms. MATSUI. Mr. Speaker, as we begin debate on additional tax cuts--
H.R. 4297--we must consider them in the larger context of the
challenges this nation is facing and the impact these tax cuts will
have, on our ability to face these challenges as well as future
challenges. Our decisions must always prioritize protecting the future
of this nation for our children and their children.
Over the Thanksgiving recess, I participated in a program in my
district that sought to increase early literacy by incorporating
reading into doctors' visits. During my visit, I read to these
children--who are about my granddaughter Anna's age--about ``Clifford
the Big Red Dog.''
It is truly a wonderful program, and as I recall the joy and
animation on each child's face with every turn of the page, I am
reminded just how important the decisions we make today are . . .
because we are merely stewards of this nation for them--and we must act
as such. Are we being wise stewards in choosing to pass another tax
cut--on top of the nearly $2 trillion in cuts we have already passed?
Congress has already transformed a $5.6 trillion surplus into a more
than $3 trillion debt.
Yet, we are still financing the war in Iraq and the reconstruction
from the war in Afghanistan. Regardless of your view on our nation's
military policy over the past five years--we must pay for the wars and
their subsequent cleanup, yet to date they have been financed by
deficit spending. And we have only just begun the rebuilding efforts in
New Orleans, Gulfport and other Gulf Coast cities struck by Hurricane
Katrina.
Which brings us back to the legislation we are considering today.
There are many positive provisions in this bill. They would create an
even better future for our children and grandchildren, like my
granddaughter Anna--particularly the provision to strengthen and extend
the research and development tax credit. I am a strong supporter of
this investment.
Unfortunately, the centerpiece of this bill--the dividends and
capital gains tax cut extensions--is unnecessary at this time. Not only
do these cuts not expire until 2008, they primarily help the same
individuals who have already benefited lavishly from the previous
rounds of tax cuts.
So we are at war, we are in debt and yet again we are cutting taxes
without fully paying for it. The path we are beginning to turn down, as
begun by this budget package, may ultimately include tax cuts that will
far outstrip the some $50 billion worth of unwise spending cuts. Just
the tax cuts in this bill will add at least $6 billion to the deficit
and it seems more may be added outside this reconciliation process.
Sadly, it seems the only Americans asked to sacrifice are the brave
men and women in uniform fighting in the Middle East and our children
and grandchildren, like my Anna, who will bear the burden of our
massive debt. This defies historical precedent and common sense.
We do, however, have an opportunity to make a decision that will
return us to the path of fiscal responsibility. Ranking member Rangel
has offered a pragmatic and effective substitute bill and I am glad
today's rule will allow a vote on it.
This alternative will extend the tax cuts that expire at the end
ofthe year and provide a muchneeded AMT patch. And the Democratic
alternative will be paid for by taking back a small portion of the tax
cuts that benefit families earning more than $500,000. Simply, we
extend only what is necessary and we pay for it--Anna and other future
generations deserve no less.
I urge my colleagues to embrace the principle of shared sacrifice and
reject this tax reconciliation package in favor of the responsible
Democratic substitute.
Mr. VAN HOLLEN. Mr. Speaker, today we are presented with Act II of
the Republican majority's ongoing and tragically misguided
reconciliation saga.
In Act I, we learned who the majority felt most deserved to bear the
brunt of their spending cuts: poor citizens who rely on Medicaid,
hungry people who turn to food stamps and families trying to afford
college.
Now in Act II we are learning where they propose that money go: for
tax breaks, that are targeted primarily to benefit the top 1% of the
wealthiest Americans. And what is the net result? An even bigger
deficit that will have to be paid for by our children.
Let me be clear: In a properly prioritized budget, I believe there is
room for targeted, fiscally responsible tax relief. And that's
precisely the kind of tax relief Democrats are offering in our
substitute today.
The Democratic alternative extends all of the tax cuts set to expire
next year--including such items as the deduction for college tuition
expenses, incentives for brownfields cleanup and the 15-year
depreciation schedule for certain small business expenses. Moreover,
unlike the Republican package, Democrats provide guaranteed alternative
minimum tax relief--so that 16 million middle-class taxpayers won't be
unfairly ensnared by the AMT. Finally, and importantly, the Democratic
substitute is completely paid for--and won't add a dime to the Federal
deficit.
By contrast, when considered in its entirety, the Republican
reconciliation package will actually increase the deficit--at a time
when the
[[Page H11247]]
nation's debt is already running over $8 trillion. Additionally, when
faced with the choice of whether to use the reconciliation process to
protect AMT relief for middle-class taxpayers or tax breaks for the
wealthiest investors, the Republicans chose to leave AMT relief
unprotected while extending tax -breaks on capital gains and dividends
that don't even expire until 2008--tax breaks over half of whose
benefits flow to those who made over $1 million last year.
Mr. Speaker, during a time of war, in the aftermath of a catastrophic
hurricane, with 45 million Americans lacking health insurance and
skyrocketing home heating costs projected this winter, this majority is
proposing to take from those with the least, give to those with the
most--and tell our children they will have to pay for it all later.
Mr. Speaker, we can do better. In fact, I would submit that--in this
season above all seasons--we are required to do better.
I urge my colleagues to reject this bill and support the fiscally
responsible Democratic substitute.
Mr. UDALL of Colorado. Mr. Speaker, as we debate this bill, we must
remember it is only part of a brew based on the Republican leadership's
budget recipe.
Just before Thanksgiving, they twisted enough arms to put the first
ingredients into the mixing bowl by passing a bill to cut more than $50
billion over five years from Medicaid, student loans, and many other
programs of great importance to millions of Americans.
Today, they want to continue by adding some good things--including
extensions of well-targeted tax cuts like the research and development
tax credit and small business expensing tainted by some unwholesome
provisions, especially the premature extension of preferential rates
for dividends and capital gains.
The result, just in time for holiday parties, will be a full-bodied
one-two punch.
And while some may find it intoxicating, it will have a nasty
aftertaste for many, will leave everyone with a bad budgetary
headache--because it will actually increase the deficit--and will stick
future generations with paying the tab.
So, Mr. Speaker, count me out. I thought the original recipe was
wrong. I did not vote for the first part of the mixture. And I will not
vote for this bill.
That doesn't mean I am opposed to tax cuts. As I said, there are good
things in this bill, and I support them. That's why I voted for the
substitute.
The substitute would have exempted every family making less than
$200,000 from the alternative minimum tax--something that should be a
priority but that is not included in the bill before us. Adoption of
the motion to recommit would have had the same effect.
The substitute also included $42 billion in tax cuts over five years
targeted to spur economic growth by extending the most pressing tax
provisions that are now scheduled to expire this year.
However, unlike this bill, the substitute did not include extension
of things that will not expire this year--including the preferential
rates for dividends and capital gains--or the changes to international
tax rules.
Unfortunately, the Republican leadership was not willing to follow
that more reasonable approach, and is insisting on sticking with their
own recipe.
But the Senate has passed a quite different tax measure, and
differences between that bill and this one will have to be resolved in
conference. So, while I cannot support this bill I am hopeful that the
conferees will insist on a new and better mixture that will deserve
support.
Mr. ETHERIDGE. Mr. Speaker, I rise in strong opposition to this
latest wasteful Republican tax bill and in strong support of the Rangel
substitute. The Rangel bill is a responsible effort to extend needed
tax relief and protect middle class Americans from the Alternative
Minimum Tax (AMT), but the underlying legislation is the latest
installment of the failed Republican budget policies that have
devastated this country's finances and much of our economy.
I strongly believe that Congress must return to the values of
balanced budgets to restore growth and opportunity to our Nation's
economy. I am tremendously proud that in my first term in the U.S.
House, Congress and the White House worked together in a bipartisan
manner to balance the budget for the first time in a generation. That
responsible budget helped usher in a period of robust, broad-based
economic growth and produced record budget surpluses.
Unfortunately, the current White House and Republican Leaders in
Congress replaced that budget discipline with record deficits,
exploding national debt and unbalanced budgets in perpetuity. This bill
represents more of the same. The current Republican tax cuts will cost
our budget $81 billion over ten years, while at the same time,
Republican Leaders have proposed devastating cuts to the Farm Bill,
food stamps, child support enforcement and Medicaid. Furthermore, H.R.
4297, the Tax Reconciliation Bill, raises the taxes of nearly 17
million middle class families in America, by leaving out a provision to
extend the higher AMT exemptions that expire in a few weeks.
In contrast, the Rangel substitute would exempt from AMT increases
every family with taxable income under $200,000 per year. It includes
$42 billion in tax cuts over five years targeted to spur economic
growth through the Research and Development tax credit, small business
expensing and other initiatives. The Rangel bill maintains budget
discipline by paring back the President's tax cuts for those with
annual taxable income above $1 Million. Finally, the Rangel bill keeps
our word to the families of our soldiers in Iraq and Afghanistan by
maintaining their eligibility for the Earned Income Tax Credit.
I urge my colleagues to support the Rangel substitute and vote
against H.R. 4297.
Mr. HOLT. Mr. Speaker, today we return for part two of the budget
reconciliation bill. Just before Thanksgiving, the Republican majority
cut investments in education, American competitiveness, and programs
for the needy. Today, they will give a tax cut to the top 1%. It is a
reverse-Robin Hood value system. Apparently, the Republican leadership
thinks that the middle class is not working hard enough. They believe
that the middle class needs to work harder so that the top 1% can take
home more money.
Today, Mr. Speaker, we have a moral decision to make. I believe it is
immoral to cut $50 billion from Medicaid, food stamps, student loans,
child care payment enforcement, and foster care in order to pay for a
$56 billion tax cut for capital gains and dividends.
People with income of more then one million dollars--the top two-
tenths of one percent of the population would get $32,000 dollars. Most
tax filers, those with income below $40,000, would get $7. Those with
income above $1 million--not just those worth more than a million, but
those who have income and stock market earnings of more then $1 million
each year--would receive about half of this $56 billion tax cut. Worse
yet, you may have noticed that if we cut taxes by $56 billion and cut
spending by $50 billion, we have increased the debt. We have gone from
a projected 10-year surplus of $5.6 trillion to a projected deficit of
$3.5 trillion. With the deficit projected to rise to $640 billion by
2015, this is no time to pile on even more. This bill will force us to
borrow more from China. This is more debt we will force our children
and grandchildren to pay interest on. And for what? So the wealthiest
1% can get an even larger tax break.
Mr. Speaker, I believe there are problems with our tax system. I have
supported tax cuts in the past and I have worked with Members on both
sides of the aisle to achieve them. However, today we are ignoring a
tax problem that affects my constituents greatly. Many of my middle
class constituents are forced to pay the Alternative Minimum Tax (AMT).
This year, 3.5 million taxpayers will owe AMT. Yesterday's AMT tax bill
was just a sham, and is likely to go nowhere. With this package,
Republicans knowingly and deliberately have removed the AMT correction
and thereby will increase the taxes on more than 17 million middle-
class working families next year by failing to extend the higher
exemptions for the Alternative Minimum Tax (AMT) that expire in several
weeks. If we fail to include this in budget reconciliation, it will
grow to 19 million taxpayers next year. More than half of all couples
with two children and income between $75,000 and $100,000 will have to
pay AMT next year. This is wrong and should be addressed.
We could solve this problem today by slightly reducing the recent tax
cut for those making more then $1 million a year. Republicans are so
determined to extend tax cuts for the wealthy that they are willing to
deny relief to the middle class.
Mr. Speaker, these votes ae about our priorities and values. I ask my
colleagues to change the priorities of this Congress.
Mr. HIGGINS. Mr. Speaker, I rise to express my opposition to the
irresponsible tax reconciliation bill the House passed earlier today. I
strongly support tax relief, but I oppose this bill because it does not
target tax relief to middle class families, because it is paid for by
slashing health care and education programs and because it will
needlessly increase our national debt.
Mr. Speaker, this tax bill is the second half of a misguided budget
reconciliation package that raids the wallets of my Western New York
constituents and gives their money to those making over a million
dollars. The first half of the budget reconciliation occurred last
month, when the Majority passed a series of devastating spending cuts
to health and education programs in order to free up funding for these
tax cuts. That means that these tax cuts are paid for by cutting $11
billion from Medicaid at a time when over 45 million Americans are
without health insurance. They are paid for by throwing 300,000 people
off food stamps when hunger in this country is on the rise.
[[Page H11248]]
They are paid for by slashing $14 billion from student loan programs
when the cost of college tuition is skyrocketing. And they are paid for
by cutting child support enforcement and foster care programs.
Mr. Speaker, the tax reconciliation bill is paid for out of the
pockets of the middle class, yet working families receive little of its
benefits. If this bill were a serious attempt to provide real tax
relief to the middle class it would include an extension of the
alternative minimum tax (AMT) fix. The AMT fix is set to expire at the
end of the year, and without an extension taxes will increase on the 17
million middle class families who will be snared by the AMT. Yet this
legislation does not include AMT relief. Instead, the centerpiece of
this bill is a reduction of tax rates for capital gains and corporate
dividends. Mr. Speaker, taxing investment income at a lower rate than
earned income is rewarding wealth, not work. A fairer bill would have
reduced taxes on the paychecks of the middle class working families who
most need and deserve it.
Mr. Speaker, not only does this reconciliation package slash programs
for working families and fail to target tax relief at the middle class,
but it does nothing at all to reduce the federal budget deficit or the
national debt. In fact, this package increases the deficit because it
reduces spending by $50 billion and cuts taxes by $56 billion. In other
words, this so-called ``deficit reduction'' package actually increases
the deficit to the tune of $6 billion! Maybe this fiscal approach
explains why the Chairman of the President's own Commission on Tax
Reform said recently that he was not worried by tax policies that
increase the national debt because we can always borrow some more from
China. But I refuse to pass this bill and saddle the elementary school
children in Jamestown and Buffalo with that debt.
Mr. Speaker, I support tax cuts. I supported the AMT stand-alone bill
because the bulk of that relief goes to middle class families, and I
will continue to support tax cuts for working Americans. I am not
philosophically opposed to tax cuts for upper income Americans. But
there is a proper time for everything, and at this juncture--when we
are running record budget deficits, when we are funding our troops in
Iraq, and when we are incurring huge costs to recover from Hurricane
Katrina--at this juncture, we cannot cut taxes to the rich and increase
the burden on the middle class. Buffalo won't hear it and neither will
I.
Ms. BALDWIN. Mr. Speaker, like many of my colleagues, I spent much of
the Thanksgiving recess holding office hours throughout my
congressional district to listen to the concerns of my constituents.
Understandably, I heard how worried they are about skyrocketing energy
prices, our lack of progress in Iraq, rising health care costs, and the
recently passed budget cuts that predominately hurt the poor.
One need look no further than the tax bill on the floor today to see
why many Americans are frustrated and disappointed with the work of
this Congress. Republicans just don't seem to get it. Instead of trying
to make progress on the pressing issues facing American families, House
Republican's top priority is passing this $56 billion tax bill that
primarily benefits wealthy investors. H.R. 4297 is truly shameful as it
clearly puts enriching the wealthiest Americans before the biggest
concerns of working Americans.
The centerpiece of the Republican's tax bill today is a $20 billion
provision that would extend tax rate cuts for investors who receive
capital gains or corporate dividends. According to Citizens for Tax
Justice, the vast majority of Americans would receive no benefit at all
from this tax provision.
Specifically, 78 percent of Americans would get no tax benefit from
the capital gains and dividends provision, while an additional 10
percent would get less than $100. In my home State of Wisconsin, the
wealthiest 1 percent of taxpayers (those with an average income of more
than $1.3 million) would receive 43 percent of the tax benefits, or an
average tax cut of $18,523 in 2009 and 2010 combined.
This bill does contain a number of tax measures I strongly support,
such as the extension of the important research and development tax
credit, the state sales tax deduction, and the college tuition tax
credit. These provisions are good for our Nation and working families,
but they should not be simply used as ``sweeteners'' to garner more
support for the underlying bill and more tax cuts for investors.
I find it heartless that Republicans would bring this bill to the
House floor right after they I passed a Budget Reconciliation bill that
makes harmful cuts to health care for children and the elderly, food
stamps for needy families, student loans, and child support
enforcement. Let us be clear: these $50 billion in budget cuts were
made solely to pay for these tax cuts for the wealthiest Americans. How
can any Member of this Congress who has an ounce of compassion--justify
making college students, the poor, children, and the elderly shoulder
the cost of providing more tax cuts for the wealthy? I certainly
cannot.
In Wisconsin, 91,000 children lack health insurance, up over 7% in
just the last year. American families are struggling with soaring costs
for fuel, housing, health care, child care, and college. Yet today,
this Congress again turns a deaf ear to those concerns--not to reduce
the deficit, not to pay for the war in Iraq, not to help the hurricane
and tornado victims of 2005, but simply to satisfy those whose greed
has no bounds.
Mr. Speaker, H.R. 4297 is a sad indication of who House Republicans
are fighting for in this Congress. It should come as no surprise as we
have seen the very wealthiest Americans receive special tax breaks
every year since President Bush took office. The question today is
whether this House will ever stand up for the many, not just the few,
with budget and tax policies focused on need, not greed? I strongly
urge my colleagues to vote against this bill.
Mr. LANGEVIN. Mr. Speaker, today I rise in strong support of the
Rangel Substitute to H.R. 4297, the Tax Reconciliation Act and in
opposition to the underlying bill. Instead of stopping a tax increase
for the middle class in 2006, Republicans have chosen to keep taxes low
for the wealthiest Americans in 2009. What kind of priorities favor the
wealthy in the future over working families today? We can ill afford
the continued ``tax cut and spend'' mentality that has marked the House
during the last few years. Without a change in fiscal policy, future
generations will be buried under a mountain of debt created by
Congress.
The bill before us today has many provisions I support, including the
extension of the research and development tax credit, small business
expensing, the deduction of higher education expenses, and brownfield
sites expensing. In fact, I am a cosponsor of a bill to make the
Research and Development Tax Credit permanent, as it keeps American
companies competitive and provides a strong incentive for businesses to
invest in the future and create jobs. I also support other provisions
in this bill that help make college more affordable to millions of
students and allow teachers to deduct out-of-pocket expenses.
Unfortunately, the Republicans did not stop there. H.R. 4297 also
includes a two year extension of the capital gains and dividend tax
cuts, which are not scheduled to expire until 2008. Nearly half of
these tax cuts will go directly into the pockets of the 1 in 500
taxpayers who earn more than $1 million per year. The contrast is
stark: those who earn less than $40,000 will see an average tax cut of
$7, while those earning more than a million will save an average of
$32,000 in taxes.
While Republicans claim that the dividend tax cut boosts the economy,
the facts are not on their side. The Federal Reserve Board recently
released a report declaring that the dividend tax cuts of 2003 have not
boosted the stock market. To quote the report, ``We fail to find much,
if any, imprint of the dividend tax cut news on the value of the
aggregate stock market.'' There you have it: the Nation's top
economists have determined that dividend tax reduction does not boost
the stock market or increase wealth for shareholders.
Most disingenuous is the fact that just three weeks ago, the House
voted to cut Medicaid, student loans, foster care assistance, and food
stamps under the guise of deficit reduction. However, today, we are
voting for tax cuts that cost more than the money saved from the
spending cuts. The Republicans have exposed their real agenda: they are
robbing the poor to pay the rich.
This year, we have a projected deficit of more than $300 billion. In
addition, we will spend billions more in Iraq and Afghanistan, as well
as rebuilding the Gulf Coast in the wake of Hurricanes Katrina, Rita,
and Wilma. We simply cannot afford all of these emergency expenses
while cutting taxes for the richest Americans.
Thankfully, there is an alternative. The Rangel Substitute includes
all the noncontroversial tax extensions I mentioned earlier and also
contains three important provisions not found in H.R. 4297. First, the
substitute drops the capital gains and dividend tax cuts in order to
fix the Alternative Minimum Tax (AMT). The substitute would eliminate
AMT liability for individuals who earn less than $100,000 and joint
filers with incomes below $200,000, cutting taxes for 16 million
families. Without this provision, more than half of all families with
two children and incomes between $75,000 and $100,000 will be saddled
with the AMT. This tax increase hits the middle class, and the
Republicans are content to sit idly and let it happen. The Democratic
AMT fix is similar to the Senate-passed tax reconciliation legislation,
which would ensure a speedy conference and protect taxpayers before the
provision expires at the end of the year.
In addition, the substitute extends the tax-free status of combat
pay. While our military personnel are risking their lives abroad to
keep us safe, the least we can do is prevent burdening them and their
families with a huge tax increase.
[[Page H11249]]
Best of all, the substitute is fully offset, and will not add a dime
to the national debt. The Rangel substitute will revive the economy,
relieve the tax burden on working families, encourage companies to
invest in the future, and create jobs. The Republican bill will hand
out money to rich people and increase the deficit.
The Rangel Substitute is a common-sense alternative that prevents a
tax increase on working families, honors our troops, and does not cost
a dime. We need responsible tax policies instead of the reverse Robin
Hood approach taken by Republicans. I urge my colleagues to join me in
supporting the Rangel Substitute and opposing the underlying bill.
Mr. COSTELLO. Mr. Speaker, I rise day in opposition to H.R. 4297, the
Tax Relief Extension Reconciliation Act. I do so because I do not
believe we should be cutting taxes for the wealthiest Americans while
we are at war and at the same time cutting programs for our most
vulnerable populations and adding to the staggering debt load of our
children and grandchildren. This bill is not fiscally responsible, and
we neglect the ramifications of the budget priorities of the majority
party to the detriment of the country.
Governments on every level--from local to Federal--are running record
deficits; the number of uninsured Americans is on the rise; people
continue to go without heat, food or shelter as an abnormally cold
winter persists; and the cost of health care and education continue to
rise. The tax cuts contained in H.R. 4297 overwhelmingly benefit
affluent investors in the wake of the House cutting programs for the
poor by $50 billion in the name of deficit reduction. We continue to
spend over $6 billion per month in Iraq and cut taxes while asking the
least well off to pay for it. It's reverse Robin Hood--taking from the
poor and giving to the rich--and this is something I cannot and will
not support.
We must take stock and look at the reality of our fiscal situation--
deficits are rising with no end in sight--while the poor, the sick and
the elderly pay the price. I believe tax cuts can be part of a
reasonable approach to the Federal budget, but that we have reached a
point with our deficit and debt where we must exercise extreme caution
in using them. As Robert Bixby of the nonpartisan Concord Coalition was
quoted in today's Washington Post, ``If they (Republicans) want to cut
taxes, fine, but they are going to have to cut spending by at least
that much to help the deficit, and clearly they are not willing to do
that. They (Republicans ) have to start looking reality in the face.''
The $5.6 trillion surplus that existed in 2000 has been squandered.
Future generations will pick up the tab.
The Republican tax cut bill is bad policy and I urge my colleagues to
join me in voting no on H.R. 4297.
Ms. ROYBAL-ALLARD. Mr. Speaker, I rise today in strong opposition to
H.R. 4297, the Tax Reconciliation bill. Cutting taxes for the super
rich, and ignoring the needs of the poor and middle class, as this bill
does, is a dangerous deviation from fiscal and moral responsibility.
As with every American, I too would like to see my taxes cut.
Therefore my opposition to this bill does not stem from a deep-seated
hostility toward the concept of tax cuts. Rather, my opposition is a
plain and simple recognition that these proposed tax cuts are the wrong
kind of cuts at precisely the wrong time.
Why are they wrong kind of tax cuts? Because they primarily benefit
the super rich with little tax relief to middle class and poor
Americans who need tax relief the most.
Why do they come at the wrong time? Because today our Federal
Government is unable to meet the most essential needs of the majority
of Americans. For example, 45 million Americans are without health
insurance, too many American families cannot afford to send their
children to college, and our American communities continue to be
vulnerable to terrorist attacks here at home due to the under-funding
of many essential homeland security programs.
Instead of investing in American families, this bill condones massive
cuts to essential health, education, and programs designed to help
women and children. And instead of fully funding programs such as those
designed to support our emergency first responders in the case of a
terrorist attack, we are using that money to pay for tax cuts for the
super rich.
Add to this reality a costly war in Iraq, unprecedented spending for
hurricane relief in the Gulf, and the escalating budget deficit, and it
is very clear that now is the wrong time for these kinds of cut taxes.
Mr. Speaker, the Democrats have a fair and responsible solution. It
is fair because, instead of cutting taxes for the super rich, our
substitute bill is designed to put hardworking middle-class Americans
first in line for tax relief. For example, our substitute bill protects
the majority of American families who will negatively be affected by
the Alternative Minimum Tax. It is responsible because it avoids
further reckless spending by eliminating the extension of capital gains
and dividend tax cuts that will add to the enormous deficit that will
have to be paid by future generations.
As a grandmother myself, I believe it is morally reprehensible to
leave my grandchildren to bear the burden of debt-relief because we
spent our money on more tax cuts for the wealthy today.
To set the right course for future generations, we must make it our
priority to improve the quality of life for all Americans; not just the
lives of the privileged few. This tax-cut bill before us is needless,
reckless spending and should be rejected.
Amendment in the Nature of a Substitute Offered by Mr. Rangel
Mr. RANGEL. Mr. Speaker, I offer an amendment in the nature of a
substitute.
The SPEAKER pro tempore (Mr. Gingrey). The Clerk will designate the
amendment.
The text of the amendment is as follows:
Amendment in the nature of a substitute printed in House
Report 109-330 offered by Mr. Rangel:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Tax Relief
Extension Reconciliation Act of 2005''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title, etc.
TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006
Sec. 101. Allowance of nonrefundable personal credits against regular
and minimum tax liability.
Sec. 102. State and local general sales taxes.
Sec. 103. Research credit.
Sec. 104. Qualified tuition and related expenses.
Sec. 105. Certain expenses of elementary and secondary school teachers.
Sec. 106. Qualified Zone Academy Bonds.
Sec. 107. Tax incentives for business activities on Indian
reservations.
Sec. 108. Deduction for corporate donations of computer technology and
equipment.
Sec. 109. Availability of medical savings accounts.
Sec. 110. 15-year cost recovery for leasehold improvements.
Sec. 111. 15-year cost recovery for restaurant improvements.
Sec. 112. Taxable income limit on percentage depletion for oil and
natural gas produced from marginal properties.
Sec. 113. District of Columbia Enterprise Zone.
Sec. 114. Possession tax credit with respect to American Samoa.
Sec. 115. Parity in the application of certain limits to mental health
benefits.
Sec. 116. Election to include combat pay under earned income credit.
Sec. 117. Work opportunity credit.
Sec. 118. Welfare-to-work credit.
Sec. 119. Extension of expensing of environmental remediation costs.
Sec. 120. Temporary relief from the alternative minimum tax.
TITLE II--REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES WITH
INCOMES OVER $1,000,000
Sec. 201. Reduction in benefit of rate reduction for families with
incomes over $1,000,000.
TITLE III--MISCELLANEOUS PROVISIONS
Sec. 301. Modification of active business definition under section 355.
Sec. 302. Veterans' mortgage bonds.
Sec. 303. Capital gains treatment for certain self-created musical
works.
Sec. 304. Vessel tonnage limit.
Sec. 305. Clarification of taxation of certain settlement funds.
TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006
SECTION 101. ALLOWANCE OF NONREFUNDABLE PERSONAL CREDITS
AGAINST REGULAR AND MINIMUM TAX LIABILITY.
(a) In General.--Paragraph (2) of section 26(a) (relating
to special rule for taxable years 2000 through 2005) is
amended--
(1) in the text by striking ``or 2005'' and inserting
``2005, or 2006'', and
(2) in the heading by striking ``2005'' and inserting
``2006''.
(b) Conforming Provisions.--
(1) Subsection (i) of section 904 (relating to coordination
with nonrefundable personal credits) is amended by striking
``or 2005'' and inserting ``2005, or 2006''.
(2) The amendments made by sections 201(b), 202(f), and
618(b) of the Economic Growth and Tax Relief Reconciliation
Act of 2001 shall not apply to taxable years beginning during
2006.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
[[Page H11250]]
SEC. 102. STATE AND LOCAL GENERAL SALES TAXES.
(a) In General.--Subparagraph (I) of section 164(b)(5)
(relating to application of paragraph) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 103. RESEARCH CREDIT.
(a) Extension.--
(1) In general.--Subparagraph (B) of section 41(h)(1)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(2) Conforming amendment.--Subparagraph (D) of section
45C(b)(1) (relating to special rule) is amended by striking
``December 31, 2005'' and inserting ``December 31, 2006''.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after December 31,
2005.
(b) Increase in Rates of Alternative Incremental Credit.--
(1) In general.--Subparagraph (A) of section 41(c)(4)
(relating to election of alternative incremental credit) is
amended--
(A) by striking ``2.65 percent'' and inserting ``3
percent'',
(B) by striking ``3.2 percent'' and inserting ``4
percent'', and
(C) by striking ``3.75 percent'' and inserting ``5
percent''.
(2) Effective date.--The amendments made by this subsection
shall apply to taxable years ending after the date of the
enactment of this Act.
(c) Alternative Simplified Credit for Qualified Research
Expenses.--
(1) In general.--Subsection (c) of section 41 (relating to
base amount) is amended by redesignating paragraphs (5) and
(6) as paragraphs (6) and (7), respectively, and by inserting
after paragraph (4) the following new paragraph:
``(5) Election of alternative simplified credit.--
``(A) In general.--At the election of the taxpayer, the
credit determined under subsection (a)(1) shall be equal to
12 percent of so much of the qualified research expenses for
the taxable year as exceeds 50 percent of the average
qualified research expenses for the 3 taxable years preceding
the taxable year for which the credit is being determined.
``(B) Special rule in case of no qualified research
expenses in any of 3 preceding taxable years.--
``(i) Taxpayers to which subparagraph applies.--The credit
under this paragraph shall be determined under this
subparagraph if the taxpayer has no qualified research
expenses in any one of the 3 taxable years preceding the
taxable year for which the credit is being determined.
``(ii) Credit rate.--The credit determined under this
subparagraph shall be equal to 6 percent of the qualified
research expenses for the taxable year.
``(C) Election.--An election under this paragraph shall
apply to the taxable year for which made and all succeeding
taxable years unless revoked with the consent of the
Secretary. An election under this paragraph may not be made
for any taxable year to which an election under paragraph (4)
applies.''.
(2) Coordination with election of alternative incremental
credit.--
(A) In general.--Section 41(c)(4)(B) (relating to election)
is amended by adding at the end the following: ``An election
under this paragraph may not be made for any taxable year to
which an election under paragraph (5) applies.''.
(B) Transition rule.--In the case of an election under
section 41(c)(4) of the Internal Revenue Code of 1986 which
applies to the taxable year which includes the date of the
enactment of this Act, such election shall be treated as
revoked with the consent of the Secretary of the Treasury if
the taxpayer makes an election under section 41(c)(5) of such
Code (as added by subsection (a)) for such year.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years ending after the date of the
enactment of this Act.
SEC. 104. QUALIFIED TUITION AND RELATED EXPENSES.
(a) In General.--Subsection (e) of section 222 (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(b) Limitations.--Paragraph (2) of section 222(b) (relating
to applicable dollar limit) is amended by striking
subparagraphs (A) and (B), by redesignating subparagraph (C)
as subparagraph (B), and by inserting before subparagraph (B)
(as so redesignated) the following:
``(A) 2006.--In the case of a taxable year beginning in
2006, the applicable dollar amount shall be equal to--
``(i) in the case of a taxpayer whose adjusted gross income
for the taxable year does not exceed $65,000 ($130,000 in the
case of a joint return), $4,000,
``(ii) in the case of a taxpayer not described in clause
(i) whose adjusted gross income for the taxable year does not
exceed $80,000 ($160,000 in the case of a joint return),
$2,000, and
``(iii) in the case of any other taxpayer, zero.''.
(c) Effective Date.--The amendments made by this section
shall apply to payments made in taxable years beginning after
December 31, 2005.
SEC. 105. CERTAIN EXPENSES OF ELEMENTARY AND SECONDARY SCHOOL
TEACHERS.
(a) In General.--Subparagraph (D) of section 62(a)(2)
(relating to certain expenses of elementary and secondary
school teachers) is amended by striking ``or 2005'' and
inserting ``2005, or 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to expenses paid or incurred in taxable years
beginning after December 31, 2005.
SEC. 106. QUALIFIED ZONE ACADEMY BONDS.
(a) In General.--Paragraph (1) of section 1397E(e)
(relating to national limit) is amended by striking ``and
2005'' and inserting ``2005, and 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to obligations issued after December 31, 2005.
SEC. 107. TAX INCENTIVES FOR BUSINESS ACTIVITIES ON INDIAN
RESERVATIONS.
(a) Indian Employment Tax Credit.--
(1) In general.--Subsection (f) of section 45A (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to taxable years beginning after December 31,
2005.
(b) Accelerated Depreciation for Business Property on
Indian Reservations.--
(1) In general.--Paragraph (8) of section 168(j) (relating
to termination) is amended by striking ``December 31, 2005''
and inserting ``December 31, 2006''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply with respect to property placed in service after
December 31, 2005.
SEC. 108. DEDUCTION FOR CORPORATE DONATIONS OF COMPUTER
TECHNOLOGY AND EQUIPMENT.
(a) In General.--Subparagraph (G) of section 170(e)(6)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contributions made in taxable years beginning
after December 31, 2005.
SEC. 109. AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.
(a) In General.--Paragraphs (2) and (3)(B) of section
220(i) (defining cut-off year) are each amended by striking
``2005'' each place it appears in the text and headings and
inserting ``2006''.
(b) Conforming Amendments.--
(1) Paragraph (2) of section 220(j) is amended--
(A) in the text by striking ``or 2004'' each place it
appears and inserting ``2004, or 2005'', and
(B) in the heading by striking ``or 2004'' and inserting
``2004, or 2005''.
(2) Subparagraph (A) of section 220(j)(4) is amended by
striking ``and 2004'' and inserting ``2004, and 2005''.
(c) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.
(d) Time for Filing Reports, Etc.--
(1) The report required by section 220(j)(4) of the
Internal Revenue Code of 1986 to be made on August 1, 2005,
shall be treated as timely if made before the close of the
90-day period beginning on the date of the enactment of this
Act.
(2) The determination and publication required by section
220(j)(5) of such Code with respect to calendar year 2005
shall be treated as timely if made before the close of the
120-day period beginning on the date of the enactment of this
Act. If the determination under the preceding sentence is
that 2005 is a cut-off year under section 220(i) of such
Code, the cut-off date under such section 220(i) shall be the
last day of such 120-day period.
SEC. 110. 15-YEAR COST RECOVERY FOR LEASEHOLD IMPROVEMENTS.
(a) In General.--Clause (iv) of section 168(e)(3)(E)
(relating to 15-year property) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to property placed in service after December 31,
2005.
SEC. 111. 15-YEAR COST RECOVERY FOR RESTAURANT IMPROVEMENTS.
(a) In General.--Clause (v) of section 168(e)(3)(E)
(relating to 15-year property) is amended by striking
``January 1, 2006'' and inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to property placed in service after December 31,
2005.
SEC. 112. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR
OIL AND NATURAL GAS PRODUCED FROM MARGINAL
PROPERTIES.
(a) In General.--Subparagraph (H) of section 613A(c)(6)
(relating to oil and natural gas produced from marginal
properties) is amended by striking ``January 1, 2006'' and
inserting ``January 1, 2007''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 113. DISTRICT OF COLUMBIA ENTERPRISE ZONE.
(a) Period for Which Designation Applicable.--Subsection
(f) of section 1400 (relating to time for which designation
applicable) is amended by striking ``December 31, 2005'' both
places it appears and inserting ``December 31, 2006''.
[[Page H11251]]
(b) Tax-Exempt Economic Development Bonds.--Subsection (b)
of section 1400A (relating to period of applicability) is
amended by striking ``December 31, 2005'' and inserting
``December 31, 2006''.
(c) Zero Percent Capital Gains Rate.--
(1) In general.--Subsection (b) of section 1400B (relating
to DC Zone Asset) is amended by striking ``January 1, 2006''
each place it appears and inserting ``January 1, 2007''.
(2) Conforming amendments.--
(A) Paragraph (2) of section 1400B(e) (relating to gain
before 1998 and after 2010 not qualified) is amended--
(i) by striking ``December 31, 2010'' and inserting
``December 31, 2011'', and
(ii) by striking ``2010'' in the heading and inserting
``2011''.
(B) Paragraph (2) of section 1400B(g) (relating to sales
and exchanges of interests in partnerships and S corporations
which are DC Zone businesses) is amended by striking
``December 31, 2010'' and inserting ``December 31, 2011''.
(C) Subsection (d) of section 1400F (relating to certain
rules to apply) is amended by striking ``December 31, 2010''
and inserting ``December 31, 2011''.
(d) First-Time Homebuyer Credit for District of Columbia.--
Subsection (i) of section 1400C (relating to application of
section) is amended by striking ``January 1, 2006'' and
inserting ``January 1, 2007''.
(e) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall take effect on January
1, 2006.
(2) Tax-exempt economic development bonds.--The amendment
made by subsection (b) shall apply to obligations issued
after the date of the enactment of this Act.
SEC. 114. POSSESSION TAX CREDIT WITH RESPECT TO AMERICAN
SAMOA.
(a) In General.--Subparagraph (A) of section 936(j)(8)
(relating to special rules for certain possessions) is
amended by inserting before the period at the end the
following: ``(before January 1, 2007, in the case of American
Samoa)''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 115. PARITY IN THE APPLICATION OF CERTAIN LIMITS TO
MENTAL HEALTH BENEFITS.
(a) In General.--Paragraph (3) of section 9812(f) (relating
to application of section) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Effective Dates.--The amendment made by subsection (a)
shall take effect on the date of the enactment of this Act.
SEC. 116. ELECTION TO INCLUDE COMBAT PAY UNDER EARNED INCOME
CREDIT.
(a) In General.--Subclause (II) of section 32(c)(2)(B)(vi)
(defining earned income) is amended by striking ``January 1,
2006'' and inserting ``January 1, 2007''.
(b) Special Rule.--The amount of any refund to which an
individual is entitled by reason of amendment made by
subsection (a) shall not exceed the aggregate liability
reflected in the individual's tax account (determined by
taking into account the taxable year and all prior taxable
years).
(c) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 117. WORK OPPORTUNITY CREDIT.
(a) In General.--Subparagraph (B) of section 51(c)(4)
(relating to termination) is amended by striking ``December
31, 2005'' and inserting ``December 31, 2006''.
(b) Increase in Age Limit for Food Stamp Recipients.--
Clause (i) of section 51(d)(8)(A) (relating to qualified food
stamp recipient) is amended by striking ``25'' and inserting
``35''.
(c) Effective Date.--The amendments made by this section
shall apply to individuals who begin work for the employer
after December 31, 2005.
SEC. 118. WELFARE-TO-WORK CREDIT.
(a) In General.--Subsection (f) of section 51A (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to individuals who begin work for the employer
after December 31, 2005.
SEC. 119. EXTENSION OF EXPENSING OF ENVIRONMENTAL REMEDIATION
COSTS.
(a) In General.--Subsection (h) of section 198 (relating to
termination) is amended by striking ``December 31, 2005'' and
inserting ``December 31, 2006''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to expenditures paid or incurred after December
31, 2005.
SEC. 120. TEMPORARY RELIEF FROM THE ALTERNATIVE MINIMUM TAX.
(a) In General.--Section 55 (relating to alternative
minimum tax imposed) is amended by adding at the end the
following new subsection:
``(f) Exemption for Individuals for Taxable Years Beginning
in 2006.--For any taxable year beginning in 2006, in the case
of an individual--
``(1) In general.--The tentative minimum tax of the
taxpayer shall be zero if the adjusted gross income of the
taxpayer (as determined for purposes of the regular tax) is
equal to or less than the threshold amount.
``(2) Phasein of liability above exemption level.--In the
case of a taxpayer whose adjusted gross income exceeds the
threshold amount but does not exceed $112,500 ($225,000 in
the case of a joint return), the tax imposed by subsection
(a) shall be the amount which bears the same ratio to such
tax (determined without regard to this subsection) as--
``(A) the excess of--
``(i) the adjusted gross income of the taxpayer (as
determined for purposes of the regular tax), over
``(ii) the threshold amount, bears to
``(B) $12,500 ($25,000 in the case of a joint return).
``(3) Threshold amount.--For purposes of this paragraph,
the term `threshold amount' means $100,000 ($200,000 in the
case of a joint return).
``(4) Estates and trusts.--This subsection shall not apply
to any estate or trust.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2005.
TITLE II--REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES WITH
INCOMES OVER $1,000,000
SEC. 201. REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES
WITH INCOMES OVER $1,000,000.
(a) General Rule.--Section 1 (relating to imposition of tax
on individuals) is amended by adding at the end the following
new subsection:
``(j) Reduction in Benefit of Rate Reduction for Families
With Incomes Over $1,000,000.--
``(1) In general.--If the adjusted gross income of a
taxpayer exceeds the threshold amount, the tax imposed by
this section (determined without regard to this subsection)
shall be increased by an amount equal to 1.45 percent of so
much of the adjusted gross income as exceeds the threshold
amount.
``(2) Threshold amounts.--For purposes of this subsection,
the term `threshold amount' means--
``(A) $1,000,000 in the case of a joint return, and
``(B) $500,000 in the case of any other return.
``(3) Tax not to apply to estates and trusts.--This
subsection shall not apply to an estate or trust.
``(4) Special rule.--For purposes of section 55, the amount
of the regular tax shall be determined without regard to this
subsection.
``(5) Termination.--This subsection shall not apply to
taxable years beginning after December 31, 2010.''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
(c) Section 15 not to Apply.--The amendment made by
subsection (a) shall not be treated as a change in a rate of
tax for purposes of section 15 of the Internal Revenue Code
of 1986.
TITLE III--MISCELLANEOUS PROVISIONS
SEC. 301. MODIFICATION OF ACTIVE BUSINESS DEFINITION UNDER
SECTION 355.
Subsection (b) of section 355 (defining active conduct of a
trade or business) is amended by adding at the end the
following new paragraph:
``(3) Special rule relating to active business
requirement.--
``(A) In general.--In the case of any distribution made
after the date of the enactment of this paragraph and before
December 31, 2010, a corporation shall be treated as meeting
the requirement of paragraph (2)(A) if and only if such
corporation is engaged in the active conduct of a trade or
business.
``(B) Affiliated group rule.--For purposes of subparagraph
(A), all members of such corporation's separate affiliated
group shall be treated as one corporation. For purposes of
the preceding sentence, a corporation's separate affiliated
group is the affiliated group which would be determined under
section 1504(a) if such corporation were the common parent
and section 1504(b) did not apply.
``(C) Transition rule.--Subparagraph (A) shall not apply to
any distribution pursuant to a transaction which is--
``(i) made pursuant to an agreement which was binding on
the date of the enactment of this paragraph and at all times
thereafter,
``(ii) described in a ruling request submitted to the
Internal Revenue Service on or before such date, or
``(iii) described on or before such date in a public
announcement or in a filing with the Securities and Exchange
Commission.
The preceding sentence shall not apply if the distributing
corporation elects not to have such sentence apply to
distributions of such corporation. Any such election, once
made, shall be irrevocable.
``(D) Special rule for certain pre-enactment
distributions.--For purposes of determining the continued
qualification under paragraph (2)(A) of distributions made
before the date of the enactment of this paragraph as a
result of an acquisition, disposition, or other restructuring
after such date and before December 31, 2010, such
distribution shall be treated as made after the date of the
enactment of this paragraph for purposes of applying
subparagraphs (A) through (C) of this paragraph.''.
SEC. 302. VETERANS' MORTGAGE BONDS.
(a) All Veterans Eligible for State Home Loan Programs
Funded by Qualified Veterans' Mortgage Bonds.--
(1) In general.--Paragraph (4) of section 143(l) (defining
qualified veteran) is amended--
(A) by striking ``at some time before January 1, 1977'' in
subparagraph (A), and
(B) by striking subparagraph (B) and inserting the
following:
[[Page H11252]]
``(B) who applied for the financing before the date 25
years after the last on which such veteran left active
service.''.
(2) Effective date.--The amendments made by this subsection
shall apply to financing provided after the date of the
enactment of this Act.
(b) Revision of State Veterans Limit.--
(1) In general.--Subparagraph (B) of section 143(l)(3)
(relating to volume limitation) is amended to read as
follows:
``(B) State veterans limit.--
``(i) In general.--A State veterans limit for any calendar
year is the amount equal to--
``(I) $53,750,000 for the State of Texas,
``(II) $66,250,000 for the State of California,
``(III) $25,000,000 for the State of Oregon,
``(IV) $25,000,000 for the State of Wisconsin, and
``(V) $25,000,000 for the State of Alaska.
``(ii) Phasein.--In the case of calendar years beginning
before 2010, clause (i) shall be applied by substituting for
each of the dollar amounts therein by the applicable
percentage. For purposes of the preceding sentence, the
applicable percentage shall be determined in accordance with
the following table:
Calendar Year: Applicable percentage is:
2006.........................................................20 percent
2007.........................................................40 percent
2008.........................................................60 percent
2009........................................................80 percent.
``(iii) Termination.--The State veterans limit for any
calendar year after 2010 is zero.''.
(2) Effective date.--The amendment made by this subsection
shall apply to bonds issued after December 31, 2005.
SEC. 303. CAPITAL GAINS TREATMENT FOR CERTAIN SELF-CREATED
MUSICAL WORKS.
(a) In General.--Subsection (b) of section 1221 (relating
to capital asset defined) is amended by redesignating
paragraph (3) as paragraph (4) and by inserting after
paragraph (2) the following new paragraph:
``(3) Sale or exchange of self-created musical works.--At
the election of the taxpayer, paragraphs (1) and (3) of
subsection (a) shall not apply with respect to any sale or
exchange before January 1, 2011, of musical compositions or
copyrights in musical works by a taxpayer described in
subsection (a)(3).''.
(b) Limitation on Charitable Contributions.--Subparagraph
(A) of section 170(e)(1) is amended by inserting
``(determined without regard to section 1221(b)(3))'' after
``long-term capital gain''.
(c) Effective Date.--The amendments made by this section
shall apply to sales and exchanges in taxable years beginning
after the date of the enactment of this Act.
SEC. 304. VESSEL TONNAGE LIMIT.
(a) In General.--Paragraph (4) of section 1355(a) (relating
to qualifying vessel) is amended by inserting ``(6,000, in
the case of taxable years beginning after December 31, 2005,
and ending before January 1, 2011)'' after ``10,000''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2005.
SEC. 305. CLARIFICATION OF TAXATION OF CERTAIN SETTLEMENT
FUNDS.
(a) In General.--Subsection (g) of section 468B (relating
to clarification of taxation of certain funds) is amended to
read as follows:
``(g) Clarification of Taxation of Certain Funds.--
``(1) In general.--Except as provided in paragraph (2),
nothing in any provision of law shall be construed as
providing that an escrow account, settlement fund, or similar
fund is not subject to current income tax. The Secretary
shall prescribe regulations providing for the taxation of any
such account or fund whether as a grantor trust or otherwise.
``(2) Exemption from tax for certain settlement funds.--An
escrow account, settlement fund, or similar fund shall be
treated as beneficially owned by the United States and shall
be exempt from taxation under this subtitle if--
``(A) it is established pursuant to a consent decree
entered by a judge of a United States District Court,
``(B) it is created for the receipt of settlement payments
as directed by a government entity for the sole purpose of
resolving or satisfying one or more claims asserting
liability under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980,
``(C) the authority and control over the expenditure of
funds therein (including the expenditure of contributions
thereto and any net earnings thereon) is with such government
entity, and
``(D) upon termination, any remaining funds will be
disbursed to such government entity for use in accordance
with applicable law.
For purposes of this paragraph, the term `government entity'
means the United States, any State or political subdivision
thereof, the District of Columbia, any possession of the
United States, and any agency or instrumentality of any of
the foregoing.
``(3) Termination.--This subsection shall not apply to
accounts and funds established after December 31, 2010.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to accounts and funds established after the date
of the enactment of this Act.
The SPEAKER pro tempore. Pursuant to House Resolution 588, the
gentleman from New York (Mr. Rangel) and the gentleman from Michigan
(Mr. Camp) each will control 30 minutes.
The Chair recognizes the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, we have a Democrat substitute that really is not in
sharp conflict with the Republican bill. Many things we tried and
include and did suggest in the brief time we had to work on this bill.
Basically, what we have done, though, is to pay more attention to the
middle class that really are the victims of the alternative minimum tax
than we pay attention to the richest of America who do not find their
Republican tax cuts being threatened until 2009. Why did we do this? Is
it merely a technicality? It is a very important difference.
Yes, we voted on the Suspension Calendar to provide relief for these
people, not as much as we do in our substitute; but people have to
understand the Suspension Calendar in the House is not protected under
the other body's rules. They protected those people that they wanted to
protect, those enjoying capital gains and will continue to enjoy
capital gains and corporate dividend tax cuts until 2009. Why would
they not include right in this bill, that would be protected on the
other side, I do not know their political reasons.
But I do know this: what we refuse to do is to give tax cuts that
would extend the deficit. We do not do that to generations that follow.
Nor do we hit the poor who are sick or the kids that want to go to
school or the foster kids or those kids that are dependent on money
from their fathers who have abandoned their mothers. We do not do it in
this season, nor do we do it anytime, because there is a difference in
what we believe in.
I am suggesting this: if Members support the substitute, you are
supporting deductions for State and local taxes, real estate taxes, the
deduction for college tuition, the research credit they talk about that
we agree is so important, the work opportunity tax credit, tax
incentives for the District of Columbia and for Indian reservations,
15-year depreciation period for leasehold improvements and restaurant
improvements, qualified zone academic bonds, the brownfields cleanups,
and several other important, but minor, provisions.
What I am suggesting is that the major decision of those of you who
will have to vote is whether or not you want to give $20 billion of tax
relief to people who would not need it until 2009 at the expense not
only of the deficit but at the expense of the poorest among us; or
whether you want to take the good things that we could find in this
bill, not increase the deficit and not cut the programs for the poor,
and have a Democratic substitute that makes sense to the American
people and, hopefully, to the House of Representatives.
Mr. Speaker, I reserve the balance of my time.
Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would say to my friend from New York that we have
dealt with the AMT issue. In our legislation, we did not choose to
raise taxes, as the gentleman's substitute does, to the tune of $40
billion. So because of that, the AMT is done outside of the
reconciliation process.
When I hear so many on the other side of the aisle talk about high-
income earners, I remind Members that many small businesses in the
United States file as individuals. So when they have this $40 billion
tax increase, that is really on small businesses and the families that
those small businesses support. According to the Treasury Department,
80 percent of the people affected by the $40 billion tax increase in
their substitute are small and entrepreneurial businesses. That is the
engine of job creation in America, and that is why our economy has
recovered, because we have helped those small businesses.
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from
Michigan (Mr. Levin), a distinguished member of the Committee on Ways
and Means.
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
[[Page H11253]]
Mr. LEVIN. Mr. Speaker, the issue here is priorities and choices.
There are some similarities, but the differences are vast. Let us look
at the whole picture here, the whole picture.
You have an alternative minimum tax that is going to hit millions of
people if we do not act. We have $45 billion in extenders on which
there is basic agreement. We have a reduction in the capital gains and
dividends tax which continues for the next few years. We have proposed
budget cuts. We also have the alleged, by the Republicans, need for
fiscal discipline.
So what are their choices, because you cannot really do everything.
So here is their choice: extend the dividends and capital gains
reduction that continues in any event, extend it to 2009 and 2010 even
though over 50 percent goes to people making $1 million a year. That is
their first choice.
Their second choice is budget cuts: cuts in student loans, cuts in
child support. And I want to say to my colleague from Michigan,
administrative money for child support goes to raise money for
children, not for bureaucrats. It is 4 to 5 dollars for every dollar we
provide in administrative support. Essentially, what the Republicans do
is to reduce the amount of money going to kids over the next 10 years
by $24 billion.
Their choice also was to leave out the AMT from this bill, but then
they bring up a bill yesterday, do not pay for it, and it can be
objected to in the Senate and may not happen at all. So their choice is
clear: tax relief that goes to people making a million bucks or more
and cutting student loans, cutting food support for people who need it,
and cutting child support which will mean reductions of $24 billion
over the next 10 years. That is what the choices are here.
Mr. Speaker, they do not even maintain fiscal discipline, because if
the AMT thing were to happen, it would be unpaid for and would add to
the deficit. Our substitute has very different priorities. I urge its
adoption.
{time} 1300
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Pennsylvania (Ms. Hart), a distinguished Member of the Ways and Means
Committee.
Ms. HART. Mr. Speaker, I rise in opposition to the Democrat
substitute. This proposal actually does not continue some very
important provisions for low income Americans. It does not extend a
savers credit which actually allows a match for savings for poorer
people by the government. Their substitute does not include an
expensing provision for small businesses that allows them to use more
of their money instead of sending it to the government so that they can
grow their business and create jobs. It does not allow a provision that
provides tax benefits to those who clean up brownfield sites to
encourage new job creation in some of our older towns. It does not
include the most important provision, which is the reduced rate on
capital gains and dividends that has created all of these new jobs.
Now, you do not have to be an economist to understand these lines. On
the left-hand side, you see all the bars below the line. On the right-
hand side, all the bars are above the line. And what do those bars
represent? Well, on the first half it is from January 2001 until we
passed the capital gains and dividends tax reductions.
Interestingly enough, taxes were high, investment was low. These bars
show job losses. All of the bars underneath the line are job losses. We
passed the capital gains cut, the dividends cut, what happens?
Businesses save more of their money, reinvest, create jobs. All the
bars above the line, they show an average job gain, per month, since we
passed the capital gains and dividends cuts of 148,700 jobs. That is
just an average. As you can see, some months were higher than others,
but across the board we created almost 150,000 jobs a month as a result
of a provision that the Democrat substitute would cancel.
I urge my colleagues to cancel the Democrat substitute.
Mr. RANGEL. There must be some chart around to show how many people
were pushed into poverty during that same period of time and our wages
have been reduced, but we have it in the back if any of our Members
would like to use it.
Mr. Speaker, I yield 3 minutes to the gentleman from Maryland (Mr.
Cardin), a distinguished Member of our Ways and Means Committee.
(Mr. CARDIN asked and was given permission to revise and extend his
remarks.)
Mr. CARDIN. Mr. Speaker, let me thank the gentleman from New York for
yielding me this time, and thank him for putting together a substitute
that makes sense, that is an important bill. Yes, it is important to
extend the expiring tax provisions, and the Rangel substitute does
that. Research and development, the work opportunity tax credit, all
the important tax provisions that will expire, the substitute extends
those provisions. That is important.
The Rangel substitute does another thing that is extremely important.
It deals with the alternative minimum tax affecting 16 million of our
taxpayers of the 19 million that are under the alternative minimum tax.
That is very important to get done. And the Rangel substitute deals
with that. The Rangel substitute deals with other inequities in the Tax
Code, correcting them and getting them done right. But the substitute
does one more thing that is very important to be done, and that is it
is fiscally responsible. It does not add to the national debt. We have
huge deficits, and where do you think we get our money in order to pay
the bills? Money is coming, not from foreign investors or U.S.
investors, it is coming primarily from foreign-owned banks who are
buying our currency not because it is a good investment, they are
buying it in order to have a favorable exchange rate with the U.S.
dollar so that they can send more products here into the United States.
It is important that we be fiscally responsible, that we do not add
to the deficit. The Concord Coalition, a nonpartisan group that is only
interested in trying to deal with the national debt, said that tax cuts
need at a minimum to be offset, that we should not add to the deficit
through the tax bills.
The Rangel substitute pays for these tax reliefs. It is fiscally
responsible. It not only provides relief in the Tax Code that we need
to provide for the taxpayers of this country, it does not burden this
Nation and the future generations. And by the way, it is also good for
growth. Our deficit hurts growth in this country. The Rangel substitute
is sensitive to the need for us to make sure that we are on the right
glide path to create jobs in our economy. Mr. Speaker, this is the
right thing to do. We want to provide tax relief, but we should do it
in a way that does not burden our children and grandchildren.
I urge my colleagues to support the Rangel substitute.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas
(Mr. Brady), a distinguished Member of the Ways and Means Committee.
Mr. BRADY of Texas. I appreciate my colleague from Michigan, his
leadership in helping boost our economy, extend this tax relief. I
strongly support the original bill over the substitute. The substitute
takes a step backward in how we treat our soldiers and how we treat our
families, small businesses that are affected by the alternative minimum
tax, compared to legislation that this House passed just yesterday, we
treated soldiers better, by providing them immediate cash refunds on
their tax treatment. I do not want to step back from that today in the
substitute. We help 2\1/2\ million more families and small businesses
with their alternative minimum tax yesterday, again, almost nearly
unanimously.
I do not want to step back from that with this substitute. And the
original bill provides three provisions that are really helpful for a
lot of families in this country. It extends for 1 year the sales tax
deduction, which provides every family in the country a choice to
deduct either their state and local income taxes or their State and
local sales taxes. What it means is sales taxes, as you know, add up a
great deal, add up fast for families. This tax relief just stretches
the family paycheck a little farther and prevents hundreds of millions
of dollars of tax increases on families that would start right after
this Christmas holiday. That would be unfair. The original bill extends
this. This also provides help to universities that receive dollars,
higher education from the public higher
[[Page H11254]]
education utility fund that extends a provision that helps provide more
higher education dollars for certain universities. And then it also,
for 10 states, allows more veterans to get low interest home loans in
order when they come back from the war in Iraq and the war on terrorism
to get an opportunity to get that first home. That is very important to
a state like Texas. I strongly support the underlying bill as very
important tax relief for this country.
Mr. RANGEL. Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from
Tennessee (Mr. Tanner), an outstanding member of this committee who
truly understands the problem of the deficit.
(Mr. TANNER asked and was given permission to revise and extend his
remarks.)
Mr. TANNER. Mr. Speaker, I think the American people just want to
hear us try to get along and give them the level, be on the level with
them, give them straight talk.
What has happened here in the last several years is we have reduced
revenues with bills like this and increased spending. Now, you can do
that for a little while, and all of us have done it from time to time,
I assume, with our credit cards. But you cannot do it forever and every
American knows that.
To give you some recent history, in 2002, we had to increase the debt
limit of money that we could borrow by $450 billion in this country. In
2003, we had to increase it again by $984 billion. In 2004, again, by
$800 billion. And in the budget resolution, it is not in this bill,
they propose another $781 billion increase in the limit that we can
borrow.
Now, what that means is, since 2001, the Federal debt has grown from
5.6 to $8.1 trillion. This is available on www.publicdebt.treas.gov. Do
not take my word for it. Go, please, look it up. In 2004, 16 of 23
Federal agencies could not provide an acceptable audit. That is
available at www.gao.gov. Right now, mainland China and Hong Kong have
accumulated over $300 billion worth of our debt. That data is available
on the Treasury Department's Web site. Again, this is not an argument.
This is fact. Go look it up. I said the other day when I was talking,
things are so bad with our borrowing out of control that if China
attacked Taiwan, we would have to borrow the money from China to defend
Taiwan. 16 percent of all the taxes we collect now in this country go
to pay interest. And it gets worse by the minute. Interest on the
public debt grew more rapidly than any other spending category in the
Federal Government last year. In 2005 we paid in checks $184 billion,
in checks. If you assume that we continue to do these tax bills without
paying for them, the GAO projects that in the year 2040, every dime
collected by this government will go to pay interest on past
consumption on interest only debt.
Now, what does that mean? Where are we now? This is hard to imagine,
but so far, in this fiscal year, we have borrowed $130 billion and
spent $39 billion on interest in just the first 2 months of this fiscal
year. November's $22 billion payment was the largest ever. Debt
interest grew more rapidly in the first 2 months, 38 percent, relative
to the same rate last year. The Federal Reserve is raising interest
rates and has 12 times. Really, all I am saying is this. We are on an
unsustainable financial glide path and every reputable economist will
tell you that. We want to work with the Republicans. We want to try to
do tax relief when it makes sense and makes more commerce happen and so
forth. But we cannot do it because we cannot reach the real problem.
You know what the problem is around here? You let the PAYGO rules
lapse in 2002. We do not have meaningful enforceable budget caps. We do
not have a balanced budget amendment that has ever been voted on. And
what we have is a failure of not only communication but a failure of
management of the budget process. And we are getting deeper and deeper
in trouble by the minute.
Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from
Missouri (Mr. Blunt), the distinguished majority leader.
Mr. BLUNT. Mr. Speaker, I am in opposition to the substitute because
I am for the underlying bill and I am for the things it has done for
our economy. One of the great changes that this bill showed in what
happens in the Federal Government is a belief that people are better at
solving economic problems than government is. When the tax structure
that we are voting today to extend was put in place, the determination
was made that we were in a difficult economic time, and the way to get
out of that difficult economic time was to trust the people, not to
come up with some big complicated government program, but to trust the
people to let them keep more of their money, to put some minor
incentives in the Tax Code to do whatever they wanted to do sooner,
rather than later, but no incentive in the Tax Code to do a specific
thing.
The incentive was to trust the American people to see what we could
do to get the economy growing again and going again, and that is what
has happened. But this is no time for that to stop. This is no time to
say we should put the brakes on this economy, just because the
unemployment rate is lower than the average of the 1970s, 1980s and
1990s. It is still 5 percent. We should want it to be lower than that.
Just because income to the Federal Government increased last year at a
rate three times the projection, the highest increase in Federal
Government ever without a tax increase, how did that happen? It
happened because the economy was working. It happened because more
people had jobs, that $100 billion that came in in the fiscal year that
ended September 30 that we did not anticipate, did not come in by
accident. It came in because of a strong and growing economy. What the
underlying bill does is say, let us not increase taxes. Let us keep the
tax structure that is growing this economy in place. Let us send a
signal that that tax structure is in place, at least until 2010, and it
makes a difference.
{time} 1315
I was listening to the debate earlier, and so much of the debate
earlier was about wealthy Americans. Amazingly, those same Americans
yesterday were the upper middle class. Overnight somehow the upper
middle class became wealthy Americans.
But not just the upper middle class benefits from this. All Americans
benefit from this in their own way. In the reduction in the capital
gains rate, one out of five people that take advantage and benefit from
the capital gains rate has an income below $50,000. Fifty-eight percent
of the people that have a benefit from that have an income below
$100,000.
The capital gains, I know these people, as other Members do. The
janitor at school who has figured out how his renters help him pay for
two rental houses, and every time the pipes freeze, he is crawling
under that rental house. It has depreciated down to where the value for
tax purposes may not be very high, but it is everything that man or
woman had been able to accumulate, and that person benefits greatly
from this 15 percent rate. Why raise that rate back? Why send a signal
that that rate is going to go back?
The dividend tax, six times as many companies are paying dividends to
people that own the company today as were paying dividends in just 2003
when we made that change. And the numbers are about the same. For the
dividend rates, one out of four people that benefit from that tax make
under $50,000. Fifty-nine percent of the people that benefit from that
tax make under $100,000. Those are the same people that on this floor
yesterday we talked about how important it was they not be negatively
affected by the alternative minimum tax. I agree with that. So did
everybody but four people on the floor of the House that voted
yesterday.
I agree that we ought to continue these tax policies that are working
for America. That means we need to reject the substitute, even a
substitute from my good friend (Mr. Rangel), and move to the underlying
bill and keep this economy growing.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
I have all the respect for the majority leader, and it is true that
he knows some of these people that have gone from upper middle income
to become higher-income people, and there are other people in this
country that have seen middle-income people slip into the rolls of
poverty. So in order to have a more well-balanced bill, we concentrated
on the middle class by putting the alternative minimum tax into
[[Page H11255]]
this bill to make certain that when it gets to the body, it is
protected and we do not have to depend on just one of those people over
there rejecting it for this higher tax cut, which, of course, does not
adversely affect anybody, as the majority leader said, until 2009.
Mr. Speaker, I yield 3 minutes to the gentleman from California (Mr.
Becerra), a hardworking member of the Ways and Means Committee.
Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, I urge the Members of this body to support the Rangel
substitute.
If we recall the words of a famous President this country had, a man
of heroic proportions, Harry Truman, he said, ``The buck stops here.''
And, unfortunately, we are forgetting the words of Harry Truman because
today it seems like the mantra of the leadership in this House of
Representatives is the buck stops with your children or perhaps your
grandchildren, because we are in a portion of our Nation's history
where we have run up national deficits bigger than we have ever seen in
our life. We run up deficits in 1 year that it would have taken 200
years of Presidents to run up in the history of this Nation.
Mr. Speaker, in a time of disasters, Rita, Katrina, on and on; in a
time of massive deficits; and in a time of war, it is irresponsible to
run up the Nation's debt. It is irresponsible to then give money to run
up this debt and give it to the wealthiest Americans in this Nation.
Mr. Speaker, it is irresponsible to put debt on top of massive debt
when we know at the end of the horizon there is still more debt that
will come in the years to come: $27,000 is what each and every man,
woman, and child in this country owes as a result of our Nation's debt.
It is irresponsible, Mr. Speaker, to take Social Security surplus
money, which the President said back in 2001 he could protect and never
touch as he moved forward with these tax cuts. It is irresponsible, Mr.
Speaker, to take those Social Security surpluses and then contribute
them to the wealthiest Americans. In essence, we are gifting the Social
Security surplus moneys contributed by working Americans; we are
gifting that to the wealthiest Americans in this country through these
tax cuts.
Mr. Speaker, it is irresponsible to move forward with these tax cuts
at the same time that we are telling American families, mostly middle
class that rely on student loans so they can send their young men and
women to college, their young daughters and sons are going to have to
pay $5,000 more a year in their student loans so we can take care of
the 1 percent wealthiest Americans in this Nation in these bills. It is
irresponsible, Mr. Speaker, to move forward in that way.
It is irresponsible then to further say we still need to make more
cuts and we need to go into the foster care program and take $600
million out of the foster care program which helps us take a child out
of an abusive home and move that child into a safe setting. It is
irresponsible to take $5 billion out of a child support system that
says to deadbeat dads that we are going to take money from them, we
need to enforce that, to take $5 billion, make it into cuts, and
therefore make it more impossible for us to get those deadbeat dads to
help the mothers who are taking care of their sons and daughters in
this country. It is irresponsible.
Mr. Speaker, it is responsible when we have a Democratic substitute,
as Mr. Rangel has, that says we are going to cut taxes, but in a
targeted way, for the middle class, in a responsible way by making sure
we pay for it so we do not increase the size of the deficit. And that
is what should pass, Mr. Speaker.
President Truman was right. The buck stops here. Let us do it today
for ourselves. Let us not leave the debt to our children.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from
Virginia (Mr. Cantor), distinguished member of the Ways and Means
Committee.
Mr. CANTOR. Mr. Speaker, I rise in opposition to the substitute and
in favor of the underlying bill.
I want to talk about some of the allegations that have been brought
up in this debate. One is the fact that perhaps by continuing the tax
policies or extending the reduction in tax rate, especially in the area
of tax dividends and capital gains tax, that somehow we are aggravating
the deficit. I think that the evidence is pretty conclusive that we
have seen a tremendous stimulus and tremendous growth in revenues
because of this tax policy.
If I could quote the Chairman of the Federal Reserve Board, back in
June of this year he said: ``I do think that there are parts of the
existing recent tax changes, especially with respect to eliminating
part of the double taxation of dividends, which I think enhances
economic growth, enhances the tax base and, therefore, tax revenues,
and that it is good economic policy.''
The second point that I think is being made in favor of the
substitute and opposing the underlying bill is saying that the
extension of the reduction in tax rates on cap gains and dividends
somehow is a tax cut for the rich. I could not disagree more. And, in
fact, our own Joint Committee on Taxation, on the AMT extension's
impact, compares the two, the one that we acted on yesterday and the
one today. The AMT extension impacts 14 million taxpayers; 62 million
taxpayers benefit from reduced rates on cap gains and dividends. And
per the most recent IRS data, 96 percent of taxpayers hit by the AMT in
2003 had adjusted gross incomes in excess of $100,000. So it is clear.
Furthermore, the Joint Economic Committee says that 60 percent of
those paying capital gains taxes earn less than $50,000 annually; 85
percent earn less than $100,000 annually.
This is about jobs. This is about creating jobs for America's
families, and I urge rejection of the substitute and passage of the
underlying bill.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentlewoman from
Ohio (Mrs. Jones), a distinguished member of the Ways and Means
Committee.
(Mrs. JONES of Ohio asked and was given permission to revise and
extend her remarks.)
Mrs. JONES of Ohio. Mr. Speaker, I would like to compliment my
chairman, Mr. Charles Rangel, for his leadership on this issue.
I am glad to be on the Ways and Means Committee and glad to have the
opportunity to talk about some of these taxing issues.
It just amazes me that the majority can stand here and have the gall
to tell veterans that they are going to treat them better, to tell the
people of America that they are better at solving problems than the
government and so we are going to give them two cents back to pay for a
$100 bill; to have the gall to say that we are not going to create
bigger government and then they created the biggest institution ever,
the Homeland Security Department; and that has not taken care of poor
people across this country, particularly the victims of Katrina and
Rita as it goes on.
But can you imagine they will not tell the American people the truth.
They will not tell them that last week we reduced programs so that this
week we could extend taxes that do not even need to be extended. Can
you contemplate that the extension of the capital gains dividends is
going to cost us $50.7 billion over the next 10 years.
Now, work with me for a moment. If you work with me, you could
understand that with that $50.7 billion, 12,571,089 people could have
health care coverage; 959,230 elementary school teachers could be paid;
7,331,106 Head Start places for children who need a head start could go
back to school; 32,565,528 children could receive health care; and,
more importantly, we could build 6,514 new elementary schools in these
United States.
But, instead, we are going to extend taxes beyond this year when we
are still at war in Iraq and we are spending billions of dollars a day
to give the Iraqi children what we will not even give our children
right here at home.
My math works better than that. See, I know one plus one equals two.
I understand that it is these United States that is supposed to be
taking care of our babies and giving them a chance to go to school and
giving them a chance to go to college. And for them to have the gall to
say that a janitor sitting on a stool is going to save some money or
get some money on capital gains, give me a break.
You know it is not the janitor sitting on the stool; you know it is
the man who owns the janitorial company.
[[Page H11256]]
Mr. CAMP of Michigan. Mr. Speaker, and the $40 billion in taxes in
the Democrat substitute certainly will not give many Americans a break.
Mr. Speaker, I yield 3 minutes to the gentleman from New York (Mr.
Reynolds), a distinguished member of the Ways and Means Committee.
(Mr. REYNOLDS asked and was given permission to revise and extend his
remarks.)
Mr. REYNOLDS. Mr. Speaker, I thank the gentleman from Michigan for
yielding me this time.
Mr. Speaker, I rise today in strong support of H.R. 4297, the Tax
Relief Extension Reconciliation Act of 2005, and in opposition to the
Democrat substitute.
Mr. Speaker, the Ways and Means bill before us today addresses a
number of important priorities that are broadly supported by Members on
both sides of the aisle. These include tax savings for higher education
expenses, small business tax relief, tax incentives for research and
development by U.S. companies that create good jobs. The bill also
includes an extension of the lower rates for capital gains and
dividends, an important priority for the ever-growing investor class
that will keep our economy strong and our domestic job base growing.
Mr. Speaker, as a lead sponsor of the Stealth Tax Relief Act of 2005,
the legislation designed to prevent massive increases in the
alternative minimum tax, or AMT, from sneaking up on millions of
unsuspecting taxpayers next year, I want to take just a moment to
comment on the Democrat substitute. Just 24 hours ago, the House passed
my bill by an overwhelming bipartisan vote of 414-4. Together we sent a
strong, unmistakable signal to our colleagues across the Capitol that
extending the temporary AMT relief that is scheduled to expire in just
a matter of weeks is an important priority that must be addressed.
{time} 1330
But what does today's Democratic substitute do? Yes, it provides
relief from AMT. To pay for it, the Democratic substitute increases
taxes on families and on small businesses that create so many jobs in
our community.
Mr. Speaker, just yesterday all but four Members of the Democratic
Party supported AMT relief in the House for our hardworking middle
class without increasing taxes. But today, just 24 hours later, our
friends on the other side of the aisle are back singing a familiar tax-
raising tune, one that always leaves families with less money in their
wallets on April 15, and small businesses with less money on their
balance sheets. The Democratic substitute should be defeated.
Mr. Speaker, earlier in this debate, a colleague on the other side of
the aisle claimed that the Republican majority has done little to fight
the AMT since winning the House in 1994. To the contrary. Our
Republican majority has repeatedly provided temporary AMT relief since
we took control, an effort which we continued yesterday with the
passage of the Stealth Tax Relief Act.
I would further remind my friends on the other side of the aisle that
in 1999 the Republican Congress sent a bill to the President's desk
that would have repealed the AMT entirely. Unfortunately, no Democrats
in the House supported that bill, and President Clinton vetoed it.
Finally, I would remind Members that in 1993, as an era of the
Democratic control was coming to an end, one of the last things that
our friends on the other side of the aisle did was to provide a
retroactive increase for the AMT without indexing the exemption levels.
Mr. Speaker, I urge passage of our bill and defeat of the Democratic
substitute.
Mr. RANGEL. Mr. Speaker, I agree with my distinguished friend from
New York (Mr. Reynolds) that the Republicans did send a signal to
protect the alternative minimum tax. We want to do a lot more.
Mr. Speaker, I yield 3 minutes to the gentleman from Washington (Mr.
McDermott), who can explain the difference between what you want to do
and what we want to do in this substitute.
(Mr. McDERMOTT asked and was given permission to revise and extend
his remarks.)
Mr. McDERMOTT. Mr. Speaker, you say one thing for political cover,
and then you do another thing for your friends. That is what we are
doing here today.
Just last month the Speaker said, ``I will tell you that the most
mean-spirited thing we can do is leave our children with a debt they
cannot pay.'' That came from the Speaker. That did not come from our
side. That is the authority of the majority in this House.
Well, the words were right. But, you know, the Speaker knows, and I
know him well, he went to a college where you know about the Bible. And
there is a Bible verse that says, by their deeds ye shall know them.
And it is the deeds out here that really make the difference.
Now, the difference between what happened yesterday and what is
happening in the gentleman from New York's bill is very simply this.
Yesterday you sent a signal. You sent a press release. You sent a
message out up into the ether knowing, absolutely knowing, it would not
pass, because it is not protected in the Senate. You know that. You
know how to run this place.
You can confuse the people, but you cannot confuse anybody who knows
what is going on in here. The fact is that the gentleman from New
York's proposal is one that puts it in law and protects it so that we
can do something about the AMT.
Let me say something about the AMT. I bet you most people listening
to this do not know what AMT stands for. It stands for alternative
minimum tax. It was put in in 1986 because there were people at the top
of the scale who were not paying one single penny of tax.
So it was decided in this body that everybody who benefits from the
United States of America should pay some taxes for a civil society. The
failure to index that tax has allowed it to creep down to people making
$75,000 or $100,000; and suddenly, instead of being a few people at the
top, it is now 14 or 20 million, depending on how you want to figure.
That was never the intent.
From 1994 to the present, you have allowed it to go from covering
200,000 people to 14-plus million people. You want to use that as an
excuse for trying to get rid of the tax structure. And we know that it
was intended and you know it was intended to tax everybody in this
country.
The repeal that you tried to put through here under Clinton was an
attempt to let the top off taxes at all. You simply wanted to give them
an internal tax holiday if they could figure out how to manipulate the
tax structure. The average janitor does not have a way to manipulate
the system.
And that is why the gentleman from New York's (Mr. Rangel) is the
only honest way if you want to protect the middle class. I urge your
vote for the alternative minimum tax proposal.
Mr. CAMP. Mr. Speaker, the current rate structure of the AMT was
created by the Democrats in 1993 with no Republicans supporting the
bill.
I yield 2 minutes to the gentleman from Texas (Mr. Hensarling).
Mr. HENSARLING. Mr. Speaker, unless we enact H.R. 4297 and defeat the
Democratic substitute, Americans will receive a most unwelcome
Christmas gift from the Democrats, a huge automatic tax increase. This
will cost families billions of dollars and jeopardize millions of their
jobs.
Mr. Speaker, let me tell you just about a few of those jobs that
could be lost in my east Texas district if the Democrats have their way
in raising taxes. Hugh Dublin owns a small business called East Texas
Right of Way in my district. He specializes in the leasing of land.
Due to tax relief, his company has grown from two full-time employees
to four full-time employees. His two new employees are called Dan and
David. They were unemployed. They were out of work. But due to the
expansion of this business, they were able to start new careers.
The Democrats now want to raise taxes on Hugh Dublin and his small
business. They want to jeopardize Dan and David's paychecks and replace
them with welfare checks, and this they call compassion.
Eddie Alexander owns Triple S Electric in Henderson, Texas, an
electrical contracting business. Since the passage of our economic
growth program with tax relief, he has been able to hire two more full-
time employees, Jared and
[[Page H11257]]
John, both of whom were out of work, but both now provide homes for
their families. The Democrats want to raise taxes on Eddie Alexander
and his small business.
They want to jeopardize Jared and John's paychecks and replace them
with welfare checks, and this they call compassion.
Gil Travers owns Travers & Company, a home building company in
Athens, Texas. Due to the housing boom from tax relief, they have had
to hire three new workers, Jan, Calvin and Christy. They were all
previously unemployed. They have been hired to help clean up all of the
job sites from the new homes.
But the Democrats now want to raise taxes on Gil Travers and his
small business. They want to jeopardize Jan's, Calvin's, and Christy's
paychecks and replace them with welfare checks, and this they call
compassion.
Mr. Speaker, tax relief has credited 4.4 million new tax-paying jobs
with a future: 4.4 million hardworking Americans can now provide for
their families this Christmas. And more than just providing food and
shelter, these jobs are providing new-found hope and opportunity. We
cannot go back. We must prevent this Democratic tax increase.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from
South Carolina (Mr. Spratt).
Mr. SPRATT. Mr. Speaker, over the last few days we have seen a flurry
of tax cuts on the House floor: three yesterday, another one, a big
one, today. And over the last 6 months, four other bills have been
enacted that have tax cuts and concessions built into them, for
example, the Energy Policy Act.
By breaking all of those tax cuts into small pieces and by burying
them in other bills, not tax bills, the audit trail very quickly
becomes hard to follow. It is hard to see the forest for the trees.
Hard to see in the aggregate how all of these different tax cuts add
up.
So let us look at the revenue scorecard over the last 6 months,
bearing in mind that every delay of revenues cut is a dollar added to
the deficit. First of all, the highway bill: $500 million. The Energy
Policy Act: $6.9 billion over 5 years. The Katrina Emergency Tax Relief
Act: $6.1 billion over 5 years. The Stealth Tax Relief Act, the 1-year
extension, or patch, to the AMT adopted yesterday: $31.2 billion.
Today's bill: $56.1 billion. The bill we adopted yesterday, a
miscellany of small tax cuts, but it adds up to $153 million. And
finally the Gulf Opportunity Zone Tax Act which was passed yesterday:
$7.1 billion.
The total amount of all of these tax cuts comes to $108 billion. So
if you pass this bill today, the total impact that you will have taken
with today's vote and recent votes comes to 108.
But wait, it is not over yet. Because there is a provision in this
bill, a provision in our substitute, a provision in yesterday's bill
that indicates something has got to be done about the alternative
minimum tax. We are going to have to fix the alternative minimum tax.
If you fix it for 5 years, not 1, the aggregate effect of this fix, of
all of the other tax cuts along with it, comes to $301 billion over 5
years.
That is the sum total that these tax cuts will add to the deficit,
$301 billion if you fix the AMT next year and the following years the
same way we are fixing it this year. So the net effect on the deficit
is $301 billion in all political reality.
So every Member here who is in earnest about the deficit should be on
notice. You have a choice: you can vote for the underlying bill and add
$301 billion to the deficit over the next 5 years, or you can vote for
this bill and provide middle-income tax relief and not add a dime to
the deficit.
Here, in effect, is what your choice is. We stand at a crossroads
today that CBO has depicted as follows on this particular chart. You
can take this path here with $319 billion, or you can take this path
here, and by 2015, we can be nearly out of deficit.
On the other hand, you can take the path that this bill would take,
and you will be $640 billion in deficit in 10 years. The Democratic
substitute is morally and fiscally far and away the better choice,
particularly if you want to balance the budget and eradicate the
deficit.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Tennessee (Mrs. Blackburn).
Mrs. BLACKBURN. Mr. Speaker, I rise to support the underlying bill
and to oppose the substitute. And this is the reason why: my state,
Tennessee, has seen more than $250 million in taxpayer savings a year
from the sales tax deduction we passed in 2004.
The Tax Relief Extension Act that we are passing today will extend
that. There is no excuse not to support this matter of tax fairness for
States like mine. It is great for our economy; it is great for
Tennessee's Main Streets. And those hundreds of millions of dollars are
being pumped back into those local economies.
My State should not be penalized for choosing an alternative tax
system. It is a better tax system. We want to keep it. I know many of
my friends who are Blue Dogs supported the tax cut, and I hope that
they are going to join us today and vote for the majority's bill.
Tennesseeans are watching this vote.
Mr. Speaker, I do not know how many different ways we are going to
have to talk about this economy and the fact that it is booming, jobs
creation, home sales up, productivity soaring; but some never let facts
get in the way of their political agenda.
If you read the New York Times, the Washington Post, or listen to
many of my colleagues, you believe that our economy is dismal and we
have not created a single solitary new job. One important thing the
Federal Reserve noted: since we passed these tax relief measures in
2003, American households have increased their nest eggs, their
retirement security, their savings by $10.5 trillion, $10.5 trillion
net worth development by American households.
Finally, Mr. Speaker, this bill before us today, this bill has a
provision that helps our Nation's songwriters. As chairman of the
Congressional Songwriters Caucus, we worked to correct an inequity in
the Tax Code that penalizes them when they sell their life's work. The
bill solves that.
I thank my friend from Kentucky (Mr. Lewis) and Chairman Thomas for
their work on this issue.
Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from
Maryland (Mr. Hoyer).
{time} 1345
Mr. HOYER. Mr. Speaker, here we are just 2 weeks after House
Republicans claimed that they were restoring fiscal discipline to the
federal budget considering a tax bill that will make our deficits worse
and drive our Nation even further into debt.
In 5 short years, the Republican party's failed economic policies
have instigated $1.57 trillion in budget deficits and added $3 trillion
to the national debt. By the way, during the last 4 years of the
Clinton administration, we added not a nickel to the national debt and
all 4 years we had a surplus.
Even Alan Greenspan, the chairman of the Federal Reserve, is sounding
the alarm. He recently said, ``We should not be cutting taxes by
borrowing.'' That is what we are doing. But with this bill Republicans
are doing precisely that.
Now the Republican response will be as predictable as it is wrong.
They will claim that tax cuts pay for themselves, but at long last can
we dispense with this supply-side snake oil. Last month the incoming
chairman of the Federal Reserve told the Senate, ``I think it's unusual
for a tax cut to completely offset the revenue loss.''
That is President Bush's appointee to the Federal Reserve. And the
Comptroller General of the United States, David Walker, recently
stated, ``Anybody who says you're going to grow your way out of this
problem, (deficits and debt) would probably not pass math.''
Even the President's Council of Economic Advisers admitted in 2003,
``Although the economy grows in response to tax reductions, it is
unlikely to grow so much that lost tax revenue is completely recovered
by the higher economic activity.''
That is why we have $1.75 trillion in additional deficits in 5 years
and $3 trillion of additional debt.
So my Republican friends can stop pretending that the tax cuts in
this bill will somehow magically pay for themselves. You are suggesting
cuts twice as large as you were prepared to cut in spending. They will
not.
Finally, let me say that this tax bill perfectly illustrates the
Republican party's misguided priorities. Its centerpiece is the capital
gains and dividend
[[Page H11258]]
cuts from 2008 to 2010. Who do you think benefits from that? Certainly
not those making less than $50,000 a year. They will receive 3 percent
of the capital gains tax cut. The fact is 80 percent of the capital
gains tax cuts go to those with incomes more than $200,000; and more
than 50 percent goes to those with incomes over $1 million.
Meanwhile, this majority has refused to address the alternative
minimum tax within this bill, thereby exposing nearly one-third of
taxpayers making between $75,000 and $100,000 to higher taxes next
year.
I urge my colleagues: Vote for fairness.
Vote for fiscal sanity.
Vote for the Democratic alternative.
Mr. CAMP. Mr. Speaker, I yield 3 minutes to the gentleman from
Missouri (Mr. Hulshof), a distinguished member of the Ways and Means
Committee.
Mr. HULSHOF. Mr. Speaker, I thank the gentleman for yielding me time.
Mark Twain is probably the most famous constituent from my district
and I think it was his quote that said, ``There are lies, there are
damn lies, and there are statistics.''
I would say probably folks that are back in my district are home from
school today because we had snow. Maybe people are taking a break from
Christmas shopping and tuning into the debate, and I suspect folks are
a little perplexed and a little confused. I do not know what the middle
class is in Los Angeles or Cleveland or New York City or Baltimore or
Seattle; but I think that at least in my congressional district, if a
family is making about $50,000 a year, they probably think themselves
to be middle class.
The Democratic substitute for that sector of folks making $50,000 or
less, the Democratic substitute helps less than 200,000 taxpayers. Less
than 200,000 taxpayers are helped by the Democratic substitute that are
trying to sit around the kitchen table and pay their bills, wondering
how they are going to pay for Christmas presents for their kids.
If we extend the capital gains and dividend tax rate, almost 8
million American taxpayers making $50,000 or less, the underlying bill,
nearly 8 million taxpayers will be benefited, and I think the choice is
clear.
Now, let me say to my friend, and he is my friend from Maryland, he
talked about failed economic policies. Well, over the last 2 years,
since capital gains and dividends reductions were put into law, we have
averaged a 4 percent growth to our GDP. 4,400,000 jobs have been added
to our economy. Homeownership is up at an all-time high. Government
revenues have increased 10 percent a year since the reduction in the
cost of capital.
The gentleman from Maryland talks about priorities. Earlier we heard
from the chairman of the Democratic Congressional Campaign Committee,
and in his usual acerbic way, brought up the specter of politics. The
chairman of the DCCC talked about politics with his usual acerbic, and
yet what I find interesting as we get close to the conclusion of this
debate, there has been a very concerted effort by my friend from
Maryland to reach out to the business community in an effort to make
some political gains in the 2006 election.
After the CAFTA vote, when only 14 of our colleagues on the other
side voted for increasing our opportunities for trade. There has been
somewhat of a, reported at least, concerted effort to reach out to the
business community.
This will be an interesting vote because we have with the Democratic
substitute a tax increase of $40 billion on businesses. And the
underlying bill which, in fact, continues to reduce the cost of
capital, so are we going to deny enhanced expensing for farmers and
manufacturers? Are we going to tell those laborers and manufacturing
companies not to purchase, not to invest, not to expand their plants.
That is the choice. And for those again that at least talk to the
business community, I think the choice is clear. Reject the substitute
and vote for the underlying bill.
Mr. RANGEL. Mr. Speaker, I yield for the purpose of making a
unanimous consent request to the gentlewoman from Texas (Ms. Jackson-
Lee).
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Speaker, because the Republican tax
bill raises the deficit $3 trillion and because of the valuable aspect
of the substitute deductions for State and local retail taxes and other
provisions for working Americans, I rise in support of the substitute
and oppose the underlying bill.
Mr. Speaker, we have before us a very important piece of legislation,
H.R. 4297, the Tax Reconciliation Act. It is very important to
understand this piece of legislation within the big picture the
republicans are painting here. Just last month, the Republicans passed
a bill called ``The Deficit Reduction Act.'' This was a spending cut
bill that slashed funding to many vital programs my constituents depend
on, including to Medicaid, student loans, food stamps, and child
support programs. The Republicans lectured us on the need to make
sacrifices to control the national debt. By passing the spending cut
bill, the Republicans actually asked the poor, the downtrodden, the
disabled and the young to sacrifice on behalf of the rest of the
country.
Now we are faced with the Tax Reconciliation Act, which will actually
add $86 billion dollars to the deficit over the next 5 years. This
proposed tax cut will not help the poor and middle class, either. An
estimated 40 percent of the tax cuts will go to families with incomes
of $1 million or more, and 84 percent of the major tax cuts in this
bill will go to the richest 20 percent of families.
In fact, under this bill, over 17 million middle class Americans will
face a tax increase next year from the Alternative Minimum Tax (the
AMT)! An important aspect of this bill is the House's failure to
adequately address the AMT. The Alternative Minimum Tax was enacted
over 35 years ago enacted to ensure that the richest Americans would
pay their fair share of income tax. Unfortunately, when the AMT was
enacted, Congress neglected to index the tax rates to inflation. The
AMT has now begun to add extra burden to middle class taxpayers at an
alarming rate. The senate bill provides $30 billion for AMT relief to
the middle class, while the House republican leadership could only find
$2.8 billion for this cause.
Republicans couldn't find the money to adequately pay for AMT relief
for the middle class. They can't find any money for tax relief for
those affected by hurricane Katrina in the gulf coast. Last month,
Republicans couldn't find the money to spare the elderly from Medicaid
cuts, to spare the students from loan increases, or spare our children
from child care cuts. They couldn't find the money because they are
choosing to extend the dividend and capital gains tax cuts for the
richest in our country. They also choose to pass the burden of paying
for these tax cuts on to our children in the form of a huge deficit.
This is not how we take care of our own in Texas, and this is not how
we do things in the United States. The Republicans are launching an
unabashed attack on the American way by ignoring the neediest in our
country to give tax cuts to the richest.
The Democrats have instead offered an amendment in the form of the
substitute that is much more fiscally responsible and equitable. The
Democratic Substitute extends for one year all temporary tax provisions
that expire at the end of this year, similar to the majority's bill.
The major difference, however is that the Democratic substitute
addresses the problem of the AMT by eliminating all liabilities for
middle class individuals. This will reduce the number of individuals
that pay the AMT next year by 16 million people, to just over 3 million
people. This provision would cost about $45 billion dollars, but would
be fully offset by rolling back a portion of the tax cuts that would
otherwise go to those with annual incomes of over $1 million for joint
returns and $500,000 for other returns. The Democratic substitute,
unlike the Republican option, is a fiscally responsible bill that goes
to help those who really need it instead of the very rich.
Mr. Speaker, the decision to vote up or down on this legislation
isn't a blurry line involving political ideology; it isn't a debate of
Republican vs. Democratic philosophy. The priorities in the republican
bill are misguided. Congress should not be providing additional tax
breaks for the rich less than a month after huge spending cuts aimed at
the most vulnerable. In the end, this tax bill will either exacerbate
our already large Federal deficits, or will force even deeper cuts in
critically important domestic programs. I am strongly opposed to this
legislation, and I implore my colleagues on both sides of the aisle to
vote against these unreasonable cuts and instead consider the revenue
neutral Democratic alternative.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from New
York (Mr. Fossella).
(Mr. FOSSELLA asked and was given permission to revise and extend his
remarks.)
Mr. FOSSELLA. Mr. Speaker, I thank the gentleman for yielding me
time. I rise to support the underlying bill and to oppose the
Democratic substitute.
[[Page H11259]]
The numbers three, four, and five come to mind. Three is basically a
reflection of what our inflation rate is at; four for the percentage of
which our economy is growing on an annual basis; and five for
unemployment rate that exists in this country with historic lows.
One way we can ensure that that number five comes even lower and that
number four goes even higher is to support the underlying legislation.
Why? Because it is proven to work. When you reduce the taxes and the
penalties on the accumulation of capital, what we see is an economy
that grows. So whether you are a small business owner in Staten Island
or a small business owner in San Francisco, you are able to put more
people to work and we watch our economy grow and grow and grow.
My concern with the Democratic substitute is multi-fold. One is if
you are sitting at home, for example, and you are waiting for your
retirement, and in several years when your nest egg is about a half a
million dollars, which is not that much money anymore for some folks I
know living across the country, if the Democratic substitute prevails,
you are looking at basically sending another check for $25,000 to the
Federal Government. That is if you support the substitute.
In addition, if you happen to be receiving dividends, and I know many
people across the country in so-called investor class receive dividends
on a regular basis, if the Democratic substitute prevails, you will be
paying upwards of 20 percent more in taxes to the Federal Government.
Not to mention the fact that the AMT, which penalizes upwards of 80
percent of the people I know who filed in Staten Island and Brooklyn,
are getting punished by the AMT, the Democratic substitute does not
adequately address what the House passed yesterday.
In conclusion, if we are for a pro-growth economy, if we are for
bringing the unemployment rate down even further, if we are watching
for our economy to grow even greater, if we are basically placing our
faith in the American people and the entrepreneurs and the small
business owners across country, let us not punish them with higher
capital gains rates and dividend rates.
Mr. RANGEL. Mr. Speaker, I reserve the balance of my time.
Mr. CAMP. Mr. Speaker, I yield 4 minutes to the gentleman from
Louisiana (Mr. McCrery), distinguished member of the Ways and Means
Committee.
Mr. McCRERY. Mr. Speaker, I thank the gentleman for yielding me time.
Mr. Speaker, it is a curious application of tax benefits that have
been left out of the minority substitute. Let me just go over a few of
those because I think you will agree with me that it is curious which
ones are left out.
The savers credit for low income families. My friends on the other
side of the aisle continually stand up for low income families and to
their credit, why on earth would they leave out a strong incentive for
low income families to save? They do. They leave out the savers credit.
And that goes only to lower income families in this country. Generally,
those on the other side of the aisle harp about the--I will not say
evils, but the excess profits, some of the bad things that big business
does in this country, and yet they leave out the tax benefit for small
businesses in this country, something known as section 179, expensing
to help small businesspeople cope with the costs of keeping their
businesses up to date, modernizing their businesses so that they can
compete, so they can compete in the market place, sometimes with those
big bad businesses. They leave that out.
Tax benefits for cleaning up brownfield sites. Brownfield sites are
dirty sites, polluted sites where business has gone away. There is
pollution there. They are usually the champions of the environment,
cleaning up the environment. But they leave out that tax benefit to
encourage cleaning up these dirty polluted sites. Very curious.
Now, certainly there are a couple that they leave out that I can
understand. They leave out an extension of the active finance section
of subpart F. That is a lot of big words. What that means is this
particular tax provisional allows companies in this country who conduct
financial operations to compete on a level playing field with their
competitors overseas. That is what this does that they leave out of
their bill. It allows American companies to compete effectively with
companies overseas. They leave that out. But then they, as I said, they
do not particularly like big business.
The one that gave them the most glee, of course, by leaving it out
was capital gains and dividends. You have heard all the rhetoric, and I
am sure you are confused about who benefits from these. The Joint Tax
Committee, the committee that is vested with crunching the numbers in
this Congress, has produced these statistics: For the capital gains
tax, one in five Americans who claims capital gains on his tax return
has income below $50,000. Fifty-eight percent of those who claim
capital gains on their tax return have incomes below $100,000. Somewhat
different from the statistics you have heard from the other side.
Dividends are even better. One in four, 25 percent of Americans who
have dividend income have incomes below $50,000; 59 percent have
incomes below $100,000.
{time} 1400
Nearly 60 percent of Americans who claim either capital gains or
dividend income have incomes of $100,000 or less. That is basically
middle class.
Another thing that the minority sometimes likes to do, I think, is
tax. They like taxes, and they want to increase taxes; and when they
can double tax, boy, that is a real joy. That is what dividends do.
That income has already been taxed once at the corporate level. They
want to tax it again at the individual level as high a rate as
possible.
So those are the things they leave out of this bill, Mr. Speaker; and
I hope we will reject the substitute.
Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas
(Mr. Brady), a distinguished member of the Ways and Means Committee.
Mr. BRADY of Texas. Mr. Speaker, it is, I think, a terrible mistake
to leave out tax relief for dividends. These are the usually small
amounts of money that go to people, many seniors, who have invested in
a company; and these are the dividends that help ease their retirement.
Back a few years ago, we saw a number of Wall Street companies go
under, the Enrons, the WorldComs, all those dot-com technology
companies. They had big stock prices. They had great pieces of paper
saying they were wonderful companies, but the fact of the matter is
they were built on thin air. What we did under this legislation is we
said to the companies, prove that you have a solid profit-and-loss
statement, you have real assets, show us the money; pay it out in
dividends, we will lower the cost, lower the taxes on those dividends.
Since we created this tax legislation, now Fortune 500 companies, one
out of four that did not provide dividends in the past, are now
providing real money to real people who have invested in them. In other
words, we have changed the culture from what is good this quarter and
what is good for my stock price to what is the best long term, real
growth, solid businesses in America. We have changed the culture of
Wall Street because of this dividend tax relief.
It is very important we not go back to the bad old days of high stock
prices but built on thin air. We need businesses that are in it for the
long term, that pay cash to real people, that when my mom or your mom
or some other senior invests they know they are going to get a chance
for a solid dividend that they can actually keep because they invested.
This dividend relief, Mr. Speaker, is vitally important.
I oppose the Democrat substitute. I support keeping in dividend
relief, both for our seniors and our investors, and to keep Wall Street
honest.
Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from Florida
(Mr. Shaw), a distinguished member of the Ways and Means Committee,
chairman of the Trade Subcommittee.
Mr. SHAW. Mr. Speaker, I thank the gentleman for yielding me this
time.
Very briefly, since the tax rate on capital gains and dividends was
reduced in May of 2003, the economy has grown at an average rate of 4.1
percent; 4.4 million new jobs have been created;
[[Page H11260]]
government tax receipts have increased 10 percent annually.
Now we are coming to a situation in 2008 where the capital gains rate
is going to go up to 20 percent; dividends go back to ordinary income.
What effect is this going to have on the economy to all of the sudden
have that increase that we are looking at? The question has been, and I
think it has been raised, as to what is the hurry, why do it. We want
them to be able to have a tax rate that people can count on, one that
people can look into the future as far as they could. I would like to
extend it even further than that, but under reconciliation we are
limited to the budget window.
I think this is a good bill. I ask all the Members to reject the
substitute and support the base bill.
Mr. RANGEL. Mr. Speaker, it is my distinct honor to yield the
remaining time to the gentlewoman from California (Ms. Pelosi) to close
on our side, who represents the minority at this historic time.
Ms. PELOSI. Mr. Speaker, I thank the distinguished gentleman from New
York, our ranking member on the Ways and Means Committee, for yielding
me the time. I thank you and our colleagues on the committee on the
Democratic side for the excellent work you did in putting forth the
Democratic alternative today. You have made an excellent case for your
substitute and indictment against what the Republicans are doing.
Let us talk about what is happening here today. A few weeks ago,
right before Thanksgiving, there was a bill on the floor which was the
Republican budget bill. So bad was this bill in terms of it not
representing the values of our country that the religious community
gathered in the rotunda of the Capitol of the United States, and they
prayed that this Congress would make the right decisions and reject the
Republican budget proposal.
They asked some questions about why we would be giving tax cuts to
the wealthiest people in our country while taking food out of the
mouths of America's children. They said they were going to draw a moral
line in the sand because a budget should be a statement of our national
values, and what we care about in our country should be reflected in
that budget.
Today, we are talking about a tax bill which is hand-in-glove part of
the reconciliation that the Republicans are putting forth. So
embarrassed were they by their own budget and so embarrassed were they
by this tax bill that they had to have 3 weeks come between the two of
them so that the American people would separate the cause and effect of
what they were doing with their budget bill that was poor in its
values, poor in its priorities and increasing our deficit because of
this tax bill today.
Yesterday, they engaged in another sham, which was to pretend that
they were giving alternative minimum tax relief for middle-class
families in America. If they cared about middle-class families in
America, they would have put that in this bill today which has the full
protection as it goes over to the Senate. They know that that bill they
passed yesterday has no weight in the Senate. It does not have the
protection of the parliamentary process on the Senate side, and the
same applies to what they did to try to give the illusion that they
were helping our men and women in combat so that they would qualify for
the low-income tax credit. If they cared about them, they would have
them in the bill today.
This budget, as I said, should be a statement of our national values;
and while we talk about that, let us talk about what those values are.
America has always cherished the value of opportunity, and one place
where that is possible for more Americans is in the issue of education.
Taking these two bills together, we are giving tax cuts to the
wealthiest people in America while we are putting a burden on our young
people by saying that they will pay $5,800 more in their student loans
so that we can give tax cuts to people making over $1 million a year.
That is not a statement of our national values. That takes from our
children their opportunity when we should be expanding it.
Fairness. Fairness has always been a cherished American value.
Fairness. We see that during the last 5 years, these 5 years of the
Bush administration, 7 million more people in our country go to sleep
hungry, without adequate food, because they cannot afford to buy food.
Seven million more people, an increase of 12 percent, and what does
this combination of reconciliation in order to give tax cuts to people
making over $1 million a year, that cuts food stamps and takes many
tens of thousand of children off the school lunch program do? As the
religious community said, how can we as a country give tax cuts to the
wealthiest and take food out of the mouths of our children? That is not
about fairness. Fairness is an American value.
Community. America has always been about community. Alexis de
Tocqueville said it about the origins of our country, and community
means safe neighborhoods, the safety of our people, homeland security
and the rest. We are not putting adequate resources to COPS on the Beat
or anything else in order for us to give these tax cuts at the high
end. That is not about community. That is totally unfair, and it is
diminishing opportunity.
Let us take the value of responsibility, personal responsibility,
fiscal responsibility, which should be the order of the day in this
conversation here. The combination of their tax bill and their budget
bill in reconciliation, which I do not blame them for separating by 3
weeks because it is a total embarrassment with that, they are
increasing the deficit. They are increasing the deficit by $20 billion
in order to give tax cuts to the wealthiest Americans. They are putting
the burden of debt on America's children, individual debt with their
student loans and fiscal debt in terms of our national debt and what
our kids will be burdened with.
It is just totally irresponsible and at the same time increases the
deficit. Democrats support pay-as-you-go. No deficit spending. If
something is important to you, figure out how to pay for it, but do not
make my children and grandchildren have to pay for it or anybody's
children and grandchildren have to pay for it.
Every opportunity I get I want to sing the praises of the Clinton
administration. Coming out of that administration we were on a
trajectory of 5.6 trillion with a TR, dollars in surplus. In the years
of the Bush administration, that has been almost fully reversed, over
$4 trillion in deficit, a swing of around $10 trillion, an incredible
burden on the future, a tax on our children's future.
And this is the party of fiscal responsibility? Republicans have
completely abdicated that. The Democrats are the party of fiscal
responsibility. We showed we can do it then. We can do it again. We
should not today be catering to this appetite for deficits that the
Republicans cannot seem to get over. It is just absolutely immoral,
immoral for us to heap those deficits on our children.
I want to commend my colleagues on the Democratic side for what they
have done and put into their proposal. The House Democrats are
committed to an America that works for everyone, not just the
privileged few.
Our Democratic substitute reflects the values of community by
shielding the middle-class Americans from the alternative minimum tax
in a bill that really counts, not in some suspension of yesterday that
has no weight in the conference with the Senate; and it provides tax
relief, the Democratic alternative does, for our soldiers in combat in
the bill. That really matters as well.
The Democratic substitute demonstrates fairness by not adding to the
deficit; and it creates opportunities, spurring economic growth,
generating jobs and supporting our small businesses.
Our Democratic members on the committee have eloquently made an
indictment against this budget which is immoral because of the $70
billion in tax cuts, mostly for America's wealthiest. The Republican
budget decimates the very initiatives that middle-class Americans rely
upon to get ahead. The poor suffer, the rich benefit, the middle class
is paying the bill.
The number of people without health insurance has increased 4 years
in a row. People are hungry, a 12 percent increase. The number of
people who do not have health insurance has grown. They are cutting $45
billion in Medicaid, a health insurance program that is mostly for
America's poor children, many of them Katrina survivors.
[[Page H11261]]
Alexis de Tocqueville talked about community in America. He wrote
back to the French: ``America is great because America is good. If
America ever ceases to be good,'' he concluded, ``America will cease to
be great.''
This is a moment that no one in this body wants to hasten. We all
want America to be great and America to be good. Together, we can do
better by returning to our fundamental values to maintain America's
goodness by rejecting this immoral tax bill.
Mr. CAMP. Mr. Speaker, I yield myself 2 minutes.
Actually, in a few minutes we will have a vote on two tax bills, and
we have heard a lot of debate this afternoon about the two approaches
the bill takes, and I certainly appreciate my friends on the other side
for recognizing the need for tax relief.
{time} 1415
In fact, in many important ways these bills are very similar. Twenty-
two provisions in our underlying bill were taken by my friends on the
other side and put into their bill. I guess imitation is the sincerest
form of flattery.
For example, the income tax deduction for State and local taxes; the
research and development tax credit, so important to our high-tech and
manufacturing sectors of our economy; the above-the-line deduction for
higher education expenses; and the bonds for school modernization
equipment and teacher training; as well as the enhanced charitable
deduction for computer donations to schools. These are provisions that
we have that are the same.
What the Democrat substitute does not include is the extension of a
saver's credit for low-income families; the expensing for small
businesses so small entrepreneurs can grow their companies, buy the
equipment, increase their businesses and hire more people; cleaning up
brownfields sites so we can continue economic development in so many
small towns and communities in our Nation; as well as helping our
domestic manufacturers finance those large equipment sales overseas so
we can export more.
Also capital gains and dividends. We have heard a great deal about
that this afternoon. That tax provision, that benefit, has helped 24
million American families in this country. Twenty-five percent of those
families have incomes under $50,000 a year. Are those the rich we hear
talked about so much on the other side? Fifty-seven percent, almost 60
percent of the families have incomes under $100,000 a year. Are those
the very rich our friends on the other side are so worried about us
assisting?
What is irresponsible is the part of the Democrat substitute which
raises taxes. Forty billion dollars in tax increases. And 80 percent of
those taxes, that tax burden, would fall on small entrepreneurial
businesses. I urge a vote against the substitute and in favor of the
underlying bill.
Mr. Speaker, I yield the balance of my time to the gentleman from
California (Mr. Thomas), the distinguished chairman of the Ways and
Means Committee.
(Mr. THOMAS asked and was given permission to revise and extend his
remarks.)
Mr. THOMAS. Mr. Speaker, actually, I do not need 12 minutes, I only
need 10 seconds. This bill is a----
Mr. RANGEL. Parliamentary inquiry.
The SPEAKER pro tempore (Mr. Bass). Does the gentleman from
California yield for a parliamentary inquiry?
Mr. THOMAS. No.
Mr. RANGEL. Does the gentleman from California? A parliamentary
inquiry is no longer the Speaker's responsibility?
Mr. THOMAS. Mr. Speaker, who has the time?
The SPEAKER pro tempore. The gentleman from California is recognized.
Mr. RANGEL. Well, I just wanted to know how many closing speakers
they had.
The SPEAKER pro tempore. The gentleman from California has the time.
Mr. THOMAS. Mr. Speaker, it is obvious the gentleman from New York
wants to make sure you do not hear this.
As I said, you do not need 12 minutes to say this: If you vote
``yes'' for the Democrat substitute, you are increasing taxes over 5
years by $40 billion.
That is the single largest tax increase since they were in the
majority in 1993.
Mr. CAMP. Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. Pursuant to House Resolution 588, the
previous question is ordered on the bill, as amended, and on the
amendment by the gentleman from New York (Mr. Rangel).
The question is on the amendment offered by the gentleman from New
York (Mr. Rangel).
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Mr. RANGEL. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The vote was taken by electronic device, and there were--yeas 192,
nays 239, not voting 2, as follows:
[Roll No. 619]
YEAS--192
Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldwin
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Boswell
Boucher
Boyd
Brady (PA)
Brown (OH)
Brown, Corrine
Butterfield
Capps
Capuano
Cardin
Cardoza
Carnahan
Carson
Case
Chandler
Clay
Cleaver
Clyburn
Conyers
Cooper
Costa
Cramer
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (FL)
Davis (IL)
Davis (TN)
DeFazio
DeGette
Delahunt
DeLauro
Dicks
Dingell
Doggett
Doyle
Edwards
Emanuel
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank (MA)
Gonzalez
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Harman
Hastings (FL)
Herseth
Higgins
Hinchey
Hinojosa
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson, E. B.
Jones (OH)
Kaptur
Kennedy (RI)
Kildee
Kilpatrick (MI)
Kind
Kucinich
Langevin
Lantos
Larsen (WA)
Larson (CT)
Leach
Lee
Levin
Lewis (GA)
Lipinski
Lofgren, Zoe
Lowey
Lynch
Maloney
Markey
Matsui
McCarthy
McDermott
McGovern
McIntyre
McKinney
McNulty
Meehan
Meek (FL)
Meeks (NY)
Melancon
Menendez
Michaud
Millender-McDonald
Miller (NC)
Miller, George
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Nadler
Napolitano
Neal (MA)
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sanders
Schakowsky
Schiff
Schwartz (PA)
Scott (GA)
Scott (VA)
Serrano
Sherman
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Tierney
Towns
Udall (CO)
Udall (NM)
Van Hollen
Velazquez
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Wexler
Wilson (NM)
Woolsey
Wu
Wynn
NAYS--239
Aderholt
Akin
Alexander
Bachus
Baker
Barrett (SC)
Barrow
Bartlett (MD)
Barton (TX)
Bass
Bean
Beauprez
Biggert
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehlert
Boehner
Bonilla
Bonner
Bono
Boozman
Boren
Boustany
Bradley (NH)
Brady (TX)
Brown (SC)
Burgess
Burton (IN)
Buyer
Calvert
Camp (MI)
Campbell (CA)
Cannon
Cantor
Capito
Carter
Castle
Chabot
Chocola
Coble
Cole (OK)
Conaway
Costello
Crenshaw
Cubin
Culberson
Davis (KY)
Davis, Jo Ann
Davis, Tom
Deal (GA)
DeLay
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Doolittle
Drake
Dreier
Duncan
Ehlers
Emerson
English (PA)
Everett
Feeney
Ferguson
Fitzpatrick (PA)
Flake
Foley
Forbes
Fortenberry
Fossella
Foxx
Franks (AZ)
Frelinghuysen
Gallegly
Garrett (NJ)
Gerlach
Gibbons
Gilchrest
Gillmor
Gingrey
Gohmert
Goode
Goodlatte
Granger
Graves
Green (WI)
Gutknecht
Hall
Harris
Hart
Hayes
Hayworth
Hefley
Hensarling
Herger
Hobson
Hoekstra
Hostettler
Hulshof
Hunter
Hyde
Inglis (SC)
Issa
Istook
Jenkins
Jindal
Johnson (CT)
Johnson (IL)
Johnson, Sam
Jones (NC)
Kanjorski
Keller
Kelly
Kennedy (MN)
King (IA)
King (NY)
Kingston
Kirk
Kline
Knollenberg
Kolbe
Kuhl (NY)
LaHood
Latham
LaTourette
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
Marshall
Matheson
McCaul (TX)
McCollum (MN)
[[Page H11262]]
McCotter
McCrery
McHenry
McHugh
McKeon
McMorris
Mica
Miller (FL)
Miller (MI)
Miller, Gary
Moran (KS)
Murphy
Murtha
Musgrave
Myrick
Neugebauer
Ney
Northup
Norwood
Nunes
Nussle
Oberstar
Osborne
Otter
Oxley
Paul
Pearce
Pence
Peterson (MN)
Peterson (PA)
Petri
Pickering
Pitts
Platts
Poe
Pombo
Porter
Price (GA)
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Rehberg
Reichert
Renzi
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Royce
Ryan (WI)
Ryun (KS)
Sabo
Saxton
Schmidt
Schwarz (MI)
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simmons
Simpson
Smith (NJ)
Smith (TX)
Sodrel
Souder
Stearns
Sullivan
Sweeney
Tancredo
Taylor (NC)
Terry
Thomas
Thornberry
Tiahrt
Tiberi
Turner
Upton
Visclosky
Walden (OR)
Walsh
Wamp
Weldon (FL)
Weldon (PA)
Weller
Westmoreland
Whitfield
Wicker
Wilson (SC)
Wolf
Young (AK)
Young (FL)
NOT VOTING--2
Brown-Waite, Ginny
Hastings (WA)
{time} 1442
Messrs. SAXTON, SOUDER, MURPHY, RYUN of Kansas, GILLMOR, OBERSTAR,
VISCLOSKY and Mrs. NORTHUP changed their vote from ``yea'' to ``nay.''
Messrs. OLVER, JEFFERSON, HOLDEN, and RAHALL changed their vote from
``nay'' to ``yea.''
So the amendment in the nature of a substitute was rejected.
The result of the vote was announced as above recorded.
The SPEAKER pro tempore (Mr. Bass). The question is on the
engrossment and third reading of the bill.
The bill was ordered to be engrossed and read a third time, and was
read the third time.
Motion to Recommit Offered by Mr. Rangel
Mr. RANGEL. Mr. Speaker, I offer a motion to recommit.
The SPEAKER pro tempore. Is the gentleman opposed to the bill in its
present form?
Mr. RANGEL. I am, Mr. Speaker.
The SPEAKER pro tempore. The Clerk will report the motion to
recommit.
The Clerk read as follows:
Mr. Rangel moves to recommit the bill H.R. 4297 to the
Committee on Ways and Means with instructions to report the
same back to the House forthwith with the following
amendments:
Strike section 203 (relating to capital gains and dividends
rates) and redesignate succeeding sections accordingly, and
strike the item in the table of contents relating to section
203 and redesignate the items relating to succeeding sections
accordingly.
Insert after section 117 the following new section (and
amend the table of contents accordingly):
SEC. 118. TEMPORARY RELIEF FROM THE ALTERNATIVE MINIMUM TAX.
(a) In General.--Section 55 (relating to alternative
minimum tax imposed) is amended by adding at the end the
following new subsection:
``(f) Exemption for Individuals for Taxable Years Beginning
in 2006.--For any taxable year beginning in 2006, in the case
of an individual--
``(1) In general.--The tentative minimum tax of the
taxpayer shall be zero if the adjusted gross income of the
taxpayer (as determined for purposes of the regular tax) is
equal to or less than the threshold amount.
``(2) Phasein of liability above exemption level.--In the
case of a taxpayer whose adjusted gross income exceeds the
threshold amount but does not exceed $112,500 ($225,000 in
the case of a joint return), the tax imposed by subsection
(a) shall be the amount which bears the same ratio to such
tax (determined without regard to this subsection) as--
``(A) the excess of--
``(i) the adjusted gross income of the taxpayer (as
determined for purposes of the regular tax), over
``(ii) the threshold amount, bears to
``(B) $12,500 ($25,000 in the case of a joint return).
``(3) Threshold amount.--For purposes of this paragraph,
the term `threshold amount' means $100,000 ($200,000 in the
case of a joint return).
``(4) Estates and trusts.--This subsection shall not apply
to any estate or trust.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2005.
Mr. RANGEL (during the reading). Mr. Speaker, I ask unanimous consent
that the motion to recommit be considered as read and printed in the
Record.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New York?
There was no objection.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from New
York (Mr. Rangel) is recognized for 5 minutes and a Member in
opposition to the motion to recommit will be recognized for 5 minutes.
The Chair recognizes the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from
Massachusetts (Mr. Neal).
(Mr. NEAL of Massachusetts asked and was given permission to revise
and extend his remarks.)
Mr. NEAL of Massachusetts. Mr. Speaker, I want to thank the gentleman
from New York (Mr. Rangel) for offering this motion to recommit today.
The Rangel motion to recommit is about two things: truth in budgeting
and truth in borrowing.
{time} 1445
In almost 14 years now on the Ways and Means Committee, we have
spoken of addressing the alternative minimum tax issue. There has been
a lot of talk and not a lot of action. And you are going to hear in a
couple of seconds, well, yesterday, we took up the Alternative Minimum
Tax. What we did yesterday was a procedural maneuver that allowed
everybody to cover themselves, but will have very little reality as it
addresses alternative minimum tax.
The gentleman from New York's motion to recommit goes right to the
heart of the matter. You can, in a few minutes, cast a vote on really
doing something about alternative minimum tax.
Now, the next thing we are going to hear today is this: The Democrats
were in charge for 40 years and did not address the alternative minimum
tax issue. In 1994, a couple of 100,000 people paid alternative minimum
tax in America. On January 1, that number kicks up, next year, to 19
million people who will begin to pay alternative minimum tax. Mr.
Rangel's proposal addresses this issue, and we pay for it, as I
indicated at the outset of my remarks, honestly. The dividends and
capital gains proposal does not even expire until the year 2008. And
yet, we are doing that instead of doing alternative minimum tax.
Now, this Congress had time, in the last 5 years, to repeal a series
of taxes on the American people, all, by the way, for upper income
groups. We certainly had plenty of time to repeal the estate tax. We
had time to address dividends and capital gains. But we did not have
time to address alternative minimum tax other than with Band-Aid
approaches. Today, you have a chance to do something. Mr. Rangel's
proposal lacks complexity. You can, in the next couple of minutes,
choose between fixing AMT or extending dividends and capital gains cuts
for the wealthiest among us. And by the way, when we hear the other
side say that these cuts to middle income people for dividends and
capital gains, the dividend proposal that they have ought to be
understood in this light. More than 50 percent, I believe, 53 or 54
percent of their dividend proposal, goes to people who made more than
$1 million last year. Alternative minimum tax is a middle class issue
across this country and we can do something about it.
Embrace Mr. Rangel's proposal. Give him a positive vote on AMT. But
most importantly, give those 19.3 million Americans next year some much
needed relief in alternative minimum tax.
Mr. RANGEL. Well, Mr. Speaker, you can take away our right to go to
conference, our right to amend bills, but one thing you cannot take
away is our right to vote. We have a game called 3 Card Molly in New
York. You never know which one is under the shell. So they have an
opportunity to say that they want to help the wealthiest Americans, but
they like to give a whole lot of talk to those people who, through no
fault of their own, except the ineptness and the inability of the
Republicans to correct it, they got caught in the alternative minimum
tax. Now, they will scream out that they took care of it on the
suspension bill. Well, you do not have to be a parliamentarian to know
when you send something to that other side and put it on the suspension
calendar, you had better send a prayer over with it because any one guy
can stand up and say I object.
But when you cover it because you believe in it and put it in the
reconciliation bill, it means that is what you really want to do. At
the end of the
[[Page H11263]]
day, when we vote, all we are saying is, we ask the conferees, whenever
they might meet, that they are instructed by this House to take care of
those who really deserve the tax privilege the most. Take care of those
who were not really thrown into this thing because of increased income,
but were thrown into the alternative minimum tax that was not supposed
to capture them, but they got there because of inflation.
In 3 Card Molly, you do not know what is going to happen. But we will
know at the end of this vote something that John Lewis knows that they
said in the civil rights movement, and that is, which side are you on?
What a great opportunity. Take away everything you want. Take away our
votes, our opportunity to express ourselves, give us rules that you
like to give us. But, on this vote, at the end of the day, people might
ask how did you treat the alternative minimum tax? Some people might
say, well, it did come up in the House. It was not important enough to
put in the reconciliation bill and it was not important enough to allow
a lot of debate. We put it on the suspension calendar because it was
not paid for and we did not think it would be controversial. And so,
with all of the debate, what is going to happen when you get back home
is did you protect those that were most vulnerable. Forget about the
poor. Forget about the rich that you are giving the incentives to. Just
ask, on this one thing, no matter what happens in conference, where was
the alternative minimum tax protected? It is protected in our motion to
recommit.
Mr. THOMAS. Mr. Speaker, I rise in opposition to the motion to
recommit.
The SPEAKER pro tempore (Mr. Bass). The gentleman is recognized for 5
minutes.
Mr. THOMAS. Mr. Speaker, I do not need to mention yesterday or the
414 who voted to fix this problem. I would tell my friend from New York
that you only need 60 votes outside of a reconciliation to pass this.
But I do want to mention 1985. The Tax Reform Act of 1985, under their
watch, said this: ``Other regular tax itemized deductions such as those
for State and local taxes paid and for certain investment expenses, are
not allowed for minimum tax purposes.'' I assume they did that
knowingly. They were the ones who did it.
In 1993, they passed the largest tax increase on the American people
and had a chance to adjust it again then. I will say that we have made
progress today. This is an appropriate motion to recommit. It does not
kill the bill. The gentleman from Massachusetts said this is about
upper income groups. In fact, there was an editorial recently that said
it is between the rich and the very rich. But I do want to mark the
landmark comment of the gentleman from Massachusetts who said this was
about middle income people. And on page 2 of the motion to recommit,
``For purposes of this paragraph, the term `threshold amount' means
$100,000 and $200,000 in the case of a joint return.'' So $200,000 is
now middle income. I believe that is correct. They are the ones who
have always said those are the very rich. Now, the other thing you need
to understand, it is this business of how many people are going to fall
under the alternative minimum tax. Do you know why?
The reason, in 1994 that there were so few people who fell under the
alternative minimum tax is because the regular tax was so high. What
has happened in 2001, 2002, 2003 and 2004 we have driven down the
rates. And because we have lower taxes, there are more people who fall
under the alternative minimum tax. Do we need to address it? Of course.
But the vote today is far more fundamental than that. This vote, if you
vote yes, gives money to rich people to spend on consumption. Surely,
you know that pure consumption does not move the economy very much.
What they want to do is deny people the opportunity to invest and to
save to supply fuel to the engine of the economy so we can continue
with the lowest unemployment rate and the highest productivity rate
than we have seen in years. This vote is very simple. A yes vote,
consumption, not much bang for the buck. A no vote, investment and
savings and a lot of bang for the buck. Vote no on reconciliation, yes
on the bill. If we have limited dollars to spend, spend them for the
highest and best purpose.
The SPEAKER pro tempore. Without objection, the previous question is
ordered on the motion to recommit.
There was no objection.
The SPEAKER pro tempore. The question is on the motion to recommit.
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Mr. RANGEL. Mr. Speaker, on that, I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 and clause 9 of rule
XX, this 15-minute vote on the motion to recommit will be followed by
5-minute votes, if ordered, on passage of the bill and on suspending
the rules and passing H.R. 1400 debated yesterday.
The vote was taken by electronic device, and there were--yeas 193,
nays 235, not voting 5, as follows:
[Roll No. 620]
YEAS--193
Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldwin
Barrow
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Boswell
Boucher
Boyd
Brady (PA)
Brown (OH)
Brown, Corrine
Butterfield
Capps
Capuano
Cardin
Cardoza
Carnahan
Carson
Case
Chandler
Clay
Cleaver
Clyburn
Conyers
Cooper
Costa
Costello
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (FL)
Davis (IL)
Davis (TN)
DeFazio
DeGette
Delahunt
DeLauro
Dicks
Dingell
Doggett
Doyle
Edwards
Emanuel
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank (MA)
Gonzalez
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Harman
Hastings (FL)
Herseth
Higgins
Hinchey
Hinojosa
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson, E. B.
Jones (OH)
Kaptur
Kennedy (RI)
Kildee
Kilpatrick (MI)
Kind
Kucinich
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (GA)
Lipinski
Lofgren, Zoe
Lowey
Lynch
Maloney
Marshall
Matsui
McCarthy
McCollum (MN)
McDermott
McGovern
McKinney
McNulty
Meehan
Meek (FL)
Meeks (NY)
Melancon
Menendez
Michaud
Millender-McDonald
Miller (NC)
Miller, George
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Sabo
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sanders
Schakowsky
Schiff
Schwartz (PA)
Scott (GA)
Scott (VA)
Serrano
Sherman
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Strickland
Stupak
Tanner
Tauscher
Thompson (CA)
Thompson (MS)
Tierney
Towns
Udall (CO)
Udall (NM)
Van Hollen
Velazquez
Visclosky
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Wexler
Woolsey
Wu
Wynn
NAYS--235
Aderholt
Akin
Alexander
Bachus
Baker
Barrett (SC)
Bartlett (MD)
Barton (TX)
Bass
Bean
Beauprez
Biggert
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehlert
Boehner
Bonilla
Bonner
Bono
Boren
Boustany
Bradley (NH)
Brady (TX)
Brown (SC)
Burgess
Burton (IN)
Buyer
Calvert
Camp (MI)
Campbell (CA)
Cannon
Cantor
Capito
Carter
Castle
Chabot
Chocola
Coble
Cole (OK)
Conaway
Cramer
Crenshaw
Cubin
Culberson
Davis (KY)
Davis, Jo Ann
Davis, Tom
Deal (GA)
DeLay
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Doolittle
Drake
Dreier
Duncan
Ehlers
Emerson
English (PA)
Everett
Feeney
Ferguson
Fitzpatrick (PA)
Flake
Foley
Forbes
Fortenberry
Fossella
Foxx
Franks (AZ)
Frelinghuysen
Gallegly
Garrett (NJ)
Gerlach
Gibbons
Gilchrest
Gillmor
Gingrey
Gohmert
Goode
Goodlatte
Granger
Graves
Green (WI)
Gutknecht
Hall
Harris
Hart
Hayes
Hayworth
Hefley
Hensarling
Herger
Hobson
Hoekstra
Hostettler
Hulshof
Hunter
Hyde
Inglis (SC)
Issa
Istook
Jenkins
Jindal
Johnson (CT)
Johnson (IL)
Johnson, Sam
Jones (NC)
Kanjorski
Keller
Kelly
Kennedy (MN)
King (IA)
King (NY)
Kingston
Kirk
Kline
Knollenberg
Kolbe
Kuhl (NY)
LaHood
Latham
LaTourette
Leach
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
Matheson
McCaul (TX)
McCotter
McCrery
McHenry
McHugh
McIntyre
McKeon
McMorris
Mica
Miller (FL)
[[Page H11264]]
Miller (MI)
Miller, Gary
Moran (KS)
Murphy
Murtha
Musgrave
Myrick
Neugebauer
Ney
Northup
Norwood
Nunes
Nussle
Osborne
Otter
Oxley
Paul
Pearce
Pence
Peterson (MN)
Peterson (PA)
Petri
Pickering
Pitts
Platts
Poe
Pombo
Porter
Price (GA)
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Rehberg
Reichert
Renzi
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Royce
Ryan (WI)
Ryun (KS)
Saxton
Schmidt
Schwarz (MI)
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simmons
Simpson
Smith (TX)
Sodrel
Souder
Stearns
Sullivan
Sweeney
Tancredo
Taylor (MS)
Taylor (NC)
Terry
Thomas
Thornberry
Tiahrt
Tiberi
Turner
Upton
Walden (OR)
Walsh
Wamp
Weldon (FL)
Weldon (PA)
Weller
Westmoreland
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)
Young (FL)
NOT VOTING--5
Boozman
Brown-Waite, Ginny
Hastings (WA)
Markey
Smith (NJ)
{time} 1513
So the motion to recommit was rejected.
The result of the vote was announced as above recorded.
The SPEAKER pro tempore (Mr. Bass). The question is on the passage of
the bill.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. STARK. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. This will be a 5-minute vote.
The vote was taken by electronic device, and there were--yeas 234,
nays 197, not voting 3, as follows:
[Roll No. 621]
YEAS--234
Aderholt
Akin
Alexander
Bachus
Baker
Barrett (SC)
Barrow
Bartlett (MD)
Barton (TX)
Bass
Bean
Beauprez
Biggert
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehner
Bonilla
Bonner
Bono
Boozman
Boren
Boustany
Bradley (NH)
Brady (TX)
Brown (SC)
Burgess
Burton (IN)
Buyer
Calvert
Camp (MI)
Campbell (CA)
Cannon
Cantor
Capito
Carter
Castle
Chabot
Chocola
Coble
Cole (OK)
Conaway
Cramer
Crenshaw
Cubin
Cuellar
Culberson
Davis (KY)
Davis (TN)
Davis, Jo Ann
Davis, Tom
Deal (GA)
DeLay
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Doolittle
Drake
Dreier
Duncan
Ehlers
Emerson
English (PA)
Everett
Feeney
Ferguson
Fitzpatrick (PA)
Flake
Foley
Forbes
Fortenberry
Fossella
Foxx
Frelinghuysen
Gallegly
Garrett (NJ)
Gerlach
Gibbons
Gilchrest
Gillmor
Gingrey
Gohmert
Goode
Goodlatte
Gordon
Granger
Graves
Green (WI)
Gutknecht
Hall
Harris
Hart
Hastert
Hayes
Hayworth
Hefley
Hensarling
Herger
Hobson
Hoekstra
Hostettler
Hulshof
Hunter
Hyde
Inglis (SC)
Issa
Istook
Jenkins
Jindal
Johnson (CT)
Johnson (IL)
Johnson, Sam
Jones (NC)
Keller
Kelly
Kennedy (MN)
King (IA)
King (NY)
Kingston
Kirk
Kline
Knollenberg
Kolbe
Kuhl (NY)
LaHood
Latham
LaTourette
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
Marshall
McCaul (TX)
McCotter
McCrery
McHenry
McHugh
McIntyre
McKeon
McMorris
Mica
Miller (FL)
Miller (MI)
Miller, Gary
Moran (KS)
Murphy
Musgrave
Myrick
Neugebauer
Ney
Northup
Norwood
Nunes
Nussle
Osborne
Otter
Oxley
Paul
Pearce
Pence
Peterson (PA)
Petri
Pickering
Pitts
Platts
Poe
Pombo
Porter
Price (GA)
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Rehberg
Reichert
Renzi
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Royce
Ryan (WI)
Ryun (KS)
Saxton
Schmidt
Schwarz (MI)
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simmons
Simpson
Smith (NJ)
Smith (TX)
Sodrel
Souder
Stearns
Sullivan
Sweeney
Tancredo
Taylor (NC)
Terry
Thomas
Thornberry
Tiahrt
Tiberi
Turner
Walden (OR)
Walsh
Wamp
Weldon (FL)
Weldon (PA)
Weller
Westmoreland
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)
Young (FL)
NAYS--197
Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldwin
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Boehlert
Boswell
Boucher
Boyd
Brady (PA)
Brown (OH)
Brown, Corrine
Butterfield
Capps
Capuano
Cardin
Cardoza
Carnahan
Carson
Case
Chandler
Clay
Cleaver
Clyburn
Conyers
Cooper
Costa
Costello
Crowley
Cummings
Davis (AL)
Davis (CA)
Davis (FL)
Davis (IL)
DeFazio
DeGette
Delahunt
DeLauro
Dicks
Dingell
Doggett
Doyle
Edwards
Emanuel
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank (MA)
Gonzalez
Green, Al
Green, Gene
Grijalva
Gutierrez
Harman
Hastings (FL)
Herseth
Higgins
Hinchey
Hinojosa
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson, E. B.
Jones (OH)
Kanjorski
Kaptur
Kennedy (RI)
Kildee
Kilpatrick (MI)
Kind
Kucinich
Langevin
Lantos
Larsen (WA)
Larson (CT)
Leach
Lee
Levin
Lewis (GA)
Lipinski
Lofgren, Zoe
Lowey
Lynch
Maloney
Markey
Matheson
Matsui
McCarthy
McCollum (MN)
McDermott
McGovern
McKinney
McNulty
Meehan
Meek (FL)
Meeks (NY)
Melancon
Menendez
Michaud
Millender-McDonald
Miller (NC)
Miller, George
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Murtha
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Peterson (MN)
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Sabo
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sanders
Schakowsky
Schiff
Schwartz (PA)
Scott (GA)
Scott (VA)
Serrano
Sherman
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Tierney
Towns
Udall (CO)
Udall (NM)
Upton
Van Hollen
Velazquez
Visclosky
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Wexler
Woolsey
Wu
Wynn
NOT VOTING--3
Brown-Waite, Ginny
Franks (AZ)
Hastings (WA)
{time} 1523
So the bill was passed.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated for:
Mr. FRANKS of Arizona. Mr. Speaker, on rollcall No. 621 (final
passage H.R. 4297), had I been present, I would have voted ``aye''.
____________________