[Congressional Record Volume 152, Number 106 (Thursday, August 3, 2006)]
[Senate]
[Pages S8725-S8747]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Senate
Thursday, August 3, 2006
ESTATE TAX AND EXTENSION OF TAX RELIEF ACT OF 2006--MOTION TO
PROCEED
Mr. FRIST. Mr. President, we have had a lot of discussion in terms of
what the plans would be. We will be proceeding where we can finish the
bills, not the Department of Defense appropriations bill tonight, but
in all likelihood the other bills. I will propound the unanimous
consent request, and then we will lay out the evening.
Mr. President, I ask unanimous consent that notwithstanding rule
XXII, the cloture vote with respect to H.R. 5970, the Family Prosperity
Act, occur following 15 minutes for Senator Grassley, 15 minutes for
the Democratic manager, and 15 minutes for each leader; provided
further that if cloture is not invoked, the Senate then proceed
immediately to the consideration of H.R. 4, the pensions bill, and that
there be 20 minutes for debate equally divided between the two leaders,
with no amendments in order to the bill; further, that following the
use or yielding back of debate, the bill be read the third time and the
Senate proceed to a vote on passage, with no intervening action or
debate; further, that it not be in order to consider any conference
report on H.R. 2830 during this Congress.
The PRESIDING OFFICER. Is there objection?
Mr. REID. Mr. President, reserving the right to object, I move that
we amend H.R. 4388--it is the extenders, so that everybody knows what I
am talking about--with the text of the extenders amendment I offered
earlier to the defense bill. In effect, what I am saying is, we are
going to try to have a decision made on the protection act. Following
the disposition of that, we would go to the pension bill, and my
request is that following that we would pass the extenders.
The PRESIDING OFFICER. Is there objection?
Mr. FRIST. Reserving the right to object, Mr. President, I have made
it clear since the outset that our intention was to address the Family
Prosperity Act, which are the three bills, which people have been
referring to as the ``trifecta,'' unamended and without any attempt to
either separate that and add it to the pensions bill. We will proceed
as planned, consistent with the unanimous consent request that I
outlined.
I do object.
The PRESIDING OFFICER. Objection is heard.
Mr. REID. Reserving the right to object, Mr. President. I understand
the leader. He told me that earlier today. I told him I would do this.
I hope that when we come back, following the completion of the Defense
appropriations bill, this will be one of the first things we work on.
This is an extremely important piece of legislation. I am disappointed
that we were not able to complete this at the conference that was
completed a week or so ago. I have no objection to the majority
leader's request.
The PRESIDING OFFICER. Without objection, it is so ordered.
Who yields time?
Mr. FRIST. Mr. President, I will yield to Senator Grassley when he
comes. I think that I will go ahead and yield myself time on this bill.
We have essentially 30 minutes on either side, of which 15 or 20
minutes of our time will be used by Senator Grassley.
We will be voting shortly on what we are calling the Family
Prosperity Act. Heretofore, it has been called the trifecta bill
because it addresses three different issues that are critically
important to the American people.
Each of these three bills that have been grouped together to become
the Family Prosperity Act are important to hard-working Americans,
millions of them. One of the three bills is the permanent tax relief
bill. Let me say at the outset that this is a compromise bill that has
been put together. We attempted earlier to do something that I strongly
believe in, which is totally repealing this unfair and wrongful
``death'' tax. We were unable to do that on the floor of the Senate,
and after a lot of discussion between Republicans and Democrats, with
the leadership, with Senator Kyl on our side and many Democrats, a bill
that is a compromise was put together and is very similar to the bill
that is in the Family Prosperity Act.
Why is it important? Because this death tax punishes everyday
Americans by forcing them to give up their businesses, give up their
farms, which their loved ones--dads, moms, and grandparents--have
worked hard to pass on to them. It has a direct impact on farming,
ranching, construction. All of these bills are labor and capital
intensive, but the cost of passing these enterprises on to future
generations in one piece is often prohibitive and impossible to do.
[[Page S8726]]
About 90 percent of family businesses don't survive that third
generation. Even those who do manage to pass on their family businesses
are adversely affected. Instead of spending money to innovate and grow
the business, people have to pay money either to the Federal
Government, to accountants and business people to, in some way, try to
lessen the burden they would some day have to pay.
There are a lot of issues that we have addressed in this body. It is
time that we act on this one. Again, it is a compromise that we pulled
together.
The second aspect of the Family Prosperity Act are some very
important tax extenders. There is a list of those that I am sure others
will talk about, and one that is of particular interest to me is the
sales tax deductibility. In my State of Tennessee, from 1986 to 2004,
hard-working Tennesseans were placed at a disadvantage simply because
Tennessee was one of seven States that chose to raise revenue primarily
through a sales tax instead of an income tax. Thankfully, in 2004, this
body, working with President Bush, restored fairness to that Federal
tax policy, but that provision expired last year, and more than 64,000
Tennessee families will suffer if that tax relief is not extended. That
is just one provision. There are many others.
The research and development tax credit, we know, is absolutely
critical to our small businesses, mid-size businesses, and larger
businesses in order to grow and to do that research and innovation that
prepares them for the future and that creates jobs for the future.
The final piece of the Family Prosperity Act increases the minimum
wage. Specifically, it increases it by 40 percent; thus, if we were to
pass this bill tonight, the Family Prosperity Act, in the very near
term, because it already passed the House, minimum wage workers--
several million people--will have a 40 percent increase that will begin
in the very near future. Young workers entering the job market for the
first time would have a minimum wage hike that would be welcome.
I see that my colleague, Senator Grassley, is here. At this point, I
will be happy to yield to him. He has a statement of 15 to 20 minutes.
I yield to him what time is required for his statement.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Mr. President, it is my understanding that I have 15
minutes, and if I need 5 minutes off of the leader's time, I could have
it. Would you please inform me when my 15 minutes are up, and if I need
a little bit more time, without asking unanimous consent at that time,
to take it off of leader time. Does the Chair understand what I am
talking about?
The PRESIDING OFFICER. Yes, I understand the Senator. The Chair will
make sure the Senator knows when 15 minutes have been used.
Mr. GRASSLEY. I am going to support the trifecta bill. I want to
speak about the bill and around the bill and about the environment that
has taken place over the last week.
On a preliminary note, I would like to talk a little bit about the
nickname of this bill. Its authors in the House and Senate came up with
that nickname. They call it the ``trifecta'' bill.
Many folks know I'm a bit of a frugal person. You'd definitely hear
it from my staff. Some might say I am cheap. I would say frugal. Frugal
folks tend to be drudges and a bit predictable, but, at the end of the
day, frugality tends to mean that you have your house to go home to and
a little bit of savings in the bank.
You don't see a lot of frugal folks that take big speculative
gambles.
So, when I saw this term ``Trifecta,'' not being much of a gambler, I
didn't know what it meant. I asked my staff about it. They explained
that it was a horse or dog racing term. It refers to a compound bet.
That is, the bettor places a bet on three horses. The bettor indicates
which horses will win, place, and show.
I asked my staff about the typical odds on a trifecta in a horse
race. They picked the 2006 Kentucky Derby. According to the record,
Barbaro was favored to win by 6 to 1 odds, Bluegrass Cat was 30 to 1
odds to win, and Steppenwolfer was 30 to 1 odds to win.
The $2 Trifecta paid $11,418 which is a pay-out of $5,709 per every
dollar. Big pay-off. Long odds. So does our trifecta have those kind of
odds? The answer is no, but it does require 60 Senators to payoff.
Being a frugal person and a cautious legislator, you can see how I
might have problems with trifecta legislative strategy.
I guess I would look at this exercise as that kind of longshot. With
Senate votes as horses, let's take a look. At the last race, on a
motion to proceed to the House death tax repeal bill, 57 horses came
in. So, the bet was to find 3 horses among the horses that ran the
other direction and turn them around. As a farmer with some experience
with horses, let me say, once they're out of the barn and running
around, it's hard to turn them around. Senators can be similar,
especially when a vote is highly political.
It looks to me like we may not turn around many of the horses today.
I hope I am wrong. If I am right, the bottom line is that we bet on the
wrong horses. Maybe we should've taken a bet that was more likely to
pay-off.
Now, I want to turn to the substance of the bill before us. What's
this trifecta bill all about? There are really three key pieces. The
first piece is permanent death tax relief. The second piece deals with
expiring tax provisions and some other items, known as the ``trailer
bill.''
The last piece is a Federal minimum wage increase.
I am not going to describe the minimum wage piece. It is not in my
committee, the Finance Committee's, jurisdiction. It was an add-on by
the House. I really have no history with it and feel no reason to
explain it, support it, criticize it, or defend it. I will leave that
to others.
From a personal standpoint, I have supported minimum wage increases
in the past. I'll continue to support them as long as the increase
doesn't raise teen unemployment and doesn't hurt small business.
I am going to focus on the first two pieces of the trifecta. That is,
the death tax relief and the trailer bill. Those matters are squarely
within the Finance Committee's jurisdiction. I have some history with
those issues. I care a great deal about the policy in both of those
areas. As chairman, I feel a lot of responsibility for the tax policy
in these areas.
Let's take a look at death tax relief first. I support repeal. I take
it from the vote we had on the motion to proceed to the death tax
repeal bill that a majority of the Senate also supports repeal or some
sort of significant relief.
I want to make it clear to the people listening, who may not
understand how the Senate works, why we need 60 votes. A vast majority
of this Senate supports repeal of the death tax, but it won't happen
because of the 60-vote requirement.
In this case, I did some checking around on the votes after the
cloture motion failed. It became apparent to me, after conversations
with members, staff, and interested parties that the bar for getting
the 60 votes was pretty high. At first, the impression was kind of
fuzzy, but it became clear as the weeks moved on. Several barriers
existed for the Republican leadership and Senator Kyl. One, the fact
that we were then so close to an election had politicized the issue.
The Democratic leadership were becoming invested in blocking a
Republican accomplishment. They made it clear to Democratic Senators
who might otherwise be willing to work towards good policy that those
Senators would face the wrath of the Democratic Caucus.
Moreover, the Democratic leadership exploited the policy positions
that Senator Kyl and others considered priorities. Even though
Republicans moved, the movement never seemed to be enough. Also,
Democrats were focusing on points that they knew the Republican
negotiators could not be flexible. It was a troublesome negotiation.
Unfortunately, members and staff often heard what they wanted to hear.
This pattern only got worse as time went on.
While these negotiations were going on, there was a parallel track
developing. The Senate Republican leadership came up with a different
plan. The plan was to add the death tax compromise to the pension
conference. I counseled against it because I thought the mix of
conferees would not be agreeable to it and it would be an awkward
position to a broadly bipartisan
[[Page S8727]]
bill. Nevertheless, I agreed to consider this maneuver if the
proponents could show me a path to 60 votes.
The proponents went against my counsel and did not deliver on the one
thing I asked them to do: show me the votes. That plan didn't work
because, as I predicted, a majority of the conferees were not
supportive of it, and I was one of the conferees who would have
supported it.
After 4 months of tough negotiations, none of the senior conferees,
all of whom were invested in the pension policy, were keen to the idea
either. And here, I am talking about both House and Senate conferees,
Republicans and Democrats. The mission was launched and quickly
aborted.
Along came plan B. Plan B was the result of my ``wily'' counterpart--
you know, the guy who, according to House colleagues and staff,
supposedly ``snookers'' the Senate year in and year out in conferences.
My House counterpart, who, like the rest of the conferees, was never on
board with the pension plan, raised this plan B with me. Plan B was the
idea of combining some new death tax compromise with the trailer bill.
I counseled against this plan. It was clear that pursuing this plan
would cause problems with completing the pension conference. Chairman
Enzi backed me in this view. Once again, I asked the proponents to show
me the path to 60 votes. Once again, they didn't show the path, and
then, as you know, they went ahead over my objection.
So we are where we are right now at almost 9 o'clock on Thursday. The
process was lousy and offensive, but the substance is good. I will
support the bill's death tax relief proposal. I wish this death tax
policy would become law. If that does not happen, then we have to think
about the next step. We have to keep our eye on the ball. We should be
aiming for good death tax policy and for the 60 votes on how to get
there.
We have all learned a few things in this painful process.
One, death tax is a unique kind of issue. It is not like other tax
issues. It is a moral issue to folks on both sides of the aisle. To be
politically palatable, the death tax proposal needs to be either in
isolation or proportionate if combined with other tax proposals. Small
so-called sweeteners don't get us over the goal line. Holding up
popular must-do current law tax provisions also doesn't get us there.
Just look at the vote counts in the House on the various bills. Those
vote counts show what I am talking about.
So right now, we are stuck. The Democratic leadership is holding back
Members from voting their consciences and their State interests. That
resistance is there now, and it is very strong. It won't last past the
political season. The Democratic caucus will be accountable. If the
trifecta bill fails, we will be back, but we won't get anywhere until
we are out of the political season. That is the ugly political fact I
have to convey to Senators Kyl, Lincoln, and others who have worked in
a bipartisan way to get this done.
I took a look in the Tax Code and the recent history of the death tax
relief. In the past 20 years, comprehensive death tax relief occurred
two times: in 1997, in a bipartisan tax relief bill, and in 2001 on
another bipartisan tax relief bill. Both were produced by Finance
Committee members with a bipartisan working group and the involvement
of the chairman. My judgment is that if the trifecta bill fails, this
is the way we are going to have to go again.
Now I turn to the other part of the trifecta, the so-called trailer
bill. In this Congress, I have fought long and hard for extension of
tax provisions that expired at the end of last year, now 8 months into
the expired year. The extension provisions were included in the tax
reconciliation bill which passed the Senate in the spring.
Let's consider how we got here on extenders and the trailer package.
Extenders were part of a package deal that I argued for in the Budget
Committee. When the Budget Committee met in February and March of last
year, I asked for $90 billion. The $90 billion was meant to cover
expiring provisions, including capital gains and dividend rates and the
hold harmless for the alternative minimum tax. Chairman Gregg agreed to
a reconciliation instruction of $70 billion. In committee and on the
floor, I defended the reconciliation instruction as part of this plan.
Including extenders was a key part of the strategy. It came up a lot in
debate. It was a factor in holding the instruction on the floor and in
conference.
When the reconciliation bill was marked up in the Finance Committee,
the extenders were part of the same package deal. The inclusion of 2
years of extenders on the floor helped us hold the Finance Committee
bill together.
When we went to conference, the House brought a year of extenders, no
AMT hold harmless, and 2 years of capital gains and dividends. Although
we could not get 2 years of capital gains and dividends through this
Senate the first time, I knew it was important to the Republican
leadership, especially Senator Kyl, and I would even put myself in that
category. We could not fit all the pieces together because, in part,
the House would not take our anti-tax shelter measures and loophole
closers. Something had to drop. That something was what we call the
extenders.
Now, because the extenders were part of the plan and we were also
into the expired year, I insisted on assurances from Chairman Thomas of
the House Ways and Means Committee and also from the bicameral
leadership. At that time, I released a statement stating that we would
be putting the extenders in the pension conference report. This
statement was based on assurances that I had from leaders in both the
House and the Senate.
I asked for those assurances to do the right thing from a policy
perspective and also a political perspective. From the policy
perspective, the taxpayers should be able to rely on the tax
legislative process. This should be especially true with respect to the
current law expiring provisions that enjoy overwhelming bipartisan
support. From a political perspective, I asked for those assurances to
defend Republican Senators who would be attacked when the
reconciliation conference agreement was announced. Indeed, those
attacks did come, and I referred to the assurances in defending the
Senators who were under attack.
In addition, several Republican Senators asked me to make sure there
was a glidepath to those extenders. For instance, Senator Hutchison
raised the State sales tax deductibility extender in a Senate
Republican leadership meeting. Republican high-tech coalition members
asked for similar assurances.
My interest has always been to accomplish what is possible, not
taking chances with widely applicable tax relief measures on which
millions of taxpayers are relying. For example, over 12 million
Americans benefit from the State sales tax. We have charts up. I am not
going to take time to refer to them much, so I hope the audience will
look and study them. Over 12 million Americans benefit from the State
sales tax deduction. Over 3 million teachers benefit from tax
deductions for education expenses. Teachers have prepared for the
upcoming school year, and they don't know whether supplies they buy out
of their own pocket will be deductible. Over 3.5 million families
benefit from the college tuition deduction.
The PRESIDING OFFICER. The Senator should be advised his 15 minutes
has expired.
Mr. GRASSLEY. I thank the Chair. I will use a little bit of time off
the leader's time.
A week ago, I said some colleagues want to engage in a riverboat
gamble involving these popular tax relief provisions by including it
with the death tax. They call Chairman Thomas's bill the trifecta bill.
I will treat the proponents with more respect than they have treated
this chairman and the institution of the Finance Committee. I will
support this bill.
The burden is on the proponents of this gambit to produce. But to do
that, they are going to have to deal with the realities of the votes in
the Senate. People want and should expect that Congress will provide
certainty in estate planning. My colleagues have placed all the chips
on the table. It is on them to make sure it is a winning hand. If the
trifecta bill fails, they need to answer to those millions of Americans
who relied on our promise and good will as legislators.
I also have a message for the Democratic leadership. While I am
frustrated with my leadership, let me say
[[Page S8728]]
that it should also be clear that the Democratic leadership has been
more eager to produce press releases than results. The Democratic
leadership has been actively and aggressively undermining efforts to
reach a deal. This has only served to deny relief from the death tax
for America's small business and family farmers. This obstruction has
also forced these farmers and small business owners to have to live
with continued uncertainty of the current death tax structure. That is
not right. The people's business should be done.
The time has come for the Democratic leadership to stop playing
politics with family farmers and small business folks and let
responsible Democrats work on a fair compromise. It is wrong that the
Democratic leadership is preventing Senators from voting their
consciences in this manner. Senators should be allowed to put the
interests of their constituents first instead of the priorities of the
Democratic leadership.
When you cut through all the finger-pointing and the press releases,
both sides are to blame that we can't get these extenders done. Both
death tax and expiring provisions should be processed in a bipartisan,
constructive way. We should be realistic and seek to accomplish the
possible. Let's do the people's business.
Mr. President, I will support the bill before us, but should it fail,
I will use my best efforts to do what needs to be done. I will stick by
my word to the American people and ask those who give their word to
keep it with me. Either result would be right for the people. To do
neither and not act on extenders would be the wrong thing for the
people. That is why we are here to serve the people. We are here to
govern.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, I ask to be recognized for 10 minutes on
the minority time.
Mr. REID. Mr. President, I will be happy to yield 10 minutes to the
distinguished minority whip.
The PRESIDING OFFICER. Without objection, it is so ordered. The
Senator from Illinois is recognized for 10 minutes.
Mr. DURBIN. Mr. President, this legislation is known as the trifecta.
What a perfect name. What a perfect name for this legislation. Do you
know what a trifecta is? It is when you go to the racetrack and you
pick the horses that win, place, and show in the proper order--first,
second, and third. The reason that is the right name for this bill is
that a trifecta is a high-stakes gamble. That is exactly what this bill
is. It is a high-stakes gamble with America's future. A trifecta is
also a bet where there are many more losers than there are winners. And
that is exactly what this bill is. There will be many more losers in
America, if this bill is enacted, than winners.
How about the winners when it comes to the estate tax? How many
Americans are affected by the estate tax? If one listened to the other
side of the aisle, one would think that every person who gets up in the
morning and goes to work is going to pay the estate tax to the Federal
Government. Guess what. When you take a look at the chart, look for
that thin red line on this big blue circle. It represents 2 estates out
of every 1,000 in America. Mr. President, .2 percent of the estates in
America are wealthy enough to pay anything into the estate tax. So the
obvious question is, If this estate tax, which they want to repeal,
means so much to so few, how did we end up making this the flagship
issue for the Republicans in this Congress, the most important single
issue to them to the exclusion of every other issue, the issue that
returns to us on the floor with such frequency? How did they reach this
point?
The New York Times wrote an article on June 7, 2006, that explained
it. Do my colleagues want to know how these issues become big-time
issues in Washington? They wrote that over the last decade, 18 of the
wealthiest families in the country have spent more than $200 million
lobbying in the Halls of Congress to repeal the estate tax. It turns
out that these 18 families will be huge winners if this repeal is
passed. How many families will benefit if the estate tax is repealed?
Each year in America, a Nation of 300 million people: 8,200 families.
You have to search long and hard to find them. These are families who
are so well off, who have done so well in this great Nation, who have
benefited from this democracy and the blessings of liberty, who have
enjoyed a comfortable life because of their prosperity, who now have
taken millions of dollars to hire the most effective lobbyists in
Washington, DC to push through this outrageous special interest
legislation.
Trifecta: Many more losers than winners, but the winners are those
8,200 families. That is what this is all about.
Of course, they came up with a new name tonight. It is not just the
trifecta. You have to hand it to whoever sits in the bowels of the
Capitol and dreams up the names for the outrageous bills they bring to
the floor. Senator Reid has reminded us so many times that they had the
nerve to call a bill the ``Deficit Reduction Act'' which increased the
deficit. They had the nerve to call a bill the ``Healthy Forest Act''
which cut down trees. They had the nerve to name a bill the ``Clean
Skies Act'' which resulted in more air pollution. And they had the
nerve to call a bill part of the ``ownership society'' which privatized
Social Security.
Now comes ``family prosperity.'' Oh, you just want to pull up a chair
by the fireplace, relax, look at the ceiling and think: Thank God
prosperity has arrived. And what does this bill do? This bill piles on
the national debt. This bill adds to the outrageous debt which we have
seen accumulated under this President.
Take a look at this, my friends who call yourselves fiscally
conservative. When this President was elected in 2001, our entire
national debt was $5.8 trillion. In 6 years of the Bush-Cheney
ownership society, family prosperity, we are now up to $8.5 trillion
from $5.8 trillion. This President managed in such a short period of
time to increase the national debt on America by 60 percent. And look:
Follow his policies out to the year 2011, 10 years after President Bush
was elected, follow them out and notice that the national debt in
America virtually doubles. Boy, if that isn't family prosperity, I
don't know where you would turn.
Where do we look to this bill? What does it do to add to family
prosperity in America? Well, American families, look at this
prosperity. This bill adds $753 billion to the national debt. Oh, I
tell you, you just want to curl up by the fire and thank the
Republicans for coming up with this bill to make us feel so prosperous.
They are prosperous in terms of creating debt for America.
I asked Senator Frist on the floor just a day or two ago a very basic
question: Is there any limit to the amount of debt you would create for
future generations in order to give tax breaks to the wealthiest people
in America? He couldn't answer the question.
I think the answer is obvious. Senator Frist has said repeatedly he
wishes we could repeal the entire estate tax, which would drive us even
further and further into debt. American family prosperity. We are safe
in the bosom of the Grand Old Party when all they can dream up are new
ways to create debt by giving tax breaks to the wealthiest people in
America.
But there is a spoonful of sugar with this bitter medicine. They are
going to finally increase the minimum wage. It didn't take them long to
come around to this position--only 9 years. It has been 9 years since
we enacted a minimum wage of $5.15 an hour; 9 years while they resisted
us for every single attempt we have made to increase the minimum wage
for some of the lowest-paid, hardest-working people in America; 9 years
of saying no to every single proposal to give single moms raising
children enough money so they can put their kids safely in day care, so
they can buy their medicine and food and have a decent home to live in;
9 years of saying no.
And what led to this death-bed conversion by the Republicans at this
moment in time? Could it be the threat of the Democrats that there will
be no congressional pay raise until the minimum wage is increased? That
kind of gets your attention around the halls of Congress. Apparently it
caught the attention of the Republicans.
Could it be the looming election where the Bush-Cheney economic
policies are viewed so negatively across America, where people realize
that average working families are falling farther and farther behind,
that now the Republicans want to increase the minimum wage?
[[Page S8729]]
Well, it could be all of those things. But even in their effort to
get well 100 days before the election, they blew it. They blew it.
Because in seven States they wrote the minimum wage change in a way
which will force a pay cut on thousands of hard-working people. The
waiters and waitresses who depend on tips in seven States will get a
pay cut with this so-called minimum wage increase.
It is an outrage, Mr. President. It is an outrage that we have
reached this point in America where the party that used to pride itself
on fiscal conservatism can add $753 billion to our national debt
without flinching. They don't care to cut any spending or increase any
other taxes; they are going to heap this debt on future generations.
Boy, if that isn't a recipe for family prosperity, I can't imagine what
would be. And then they turn around after 9 years of saying no every
chance they have had to an increase in the minimum wage. Now they can
go along with it. They can give 6.6 million Americans an increase in
their basic minimum wage--as long as we promise that the fattest of
cats in America will get a great big bowl of tax cuts, tax cuts on the
estate tax. That is what it has come down to.
They have thrown other things in this bill like tax extenders, but we
all know what they are about. These tax extenders are kicked around
like a football every congressional session. You wait and decide which
bill you put them on to try to entice people to vote for the bill
because everyone agrees with them. Everyone understands that they are
necessary for our economy. People of all political stripes support
them.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. DURBIN. I ask unanimous consent for 30 additional seconds.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DURBIN. I would just like to say in closing, the American people
know better. This is a high-stakes gamble with America's future. This
trifecta is going to have many more American losers than winners. This
is the worst special interest bill I have seen in my time in Congress.
This will not bring prosperity to America's families. This will bring
deeper debt to our Nation at a time when we don't need it. This is the
first President in the history of the United States to call for cutting
taxes in the midst of a war, asking sacrifice from soldiers and their
families and turning around to the wealthiest in America and saying: We
are going to give you a tax cut. That is an outrage.
I hope my colleagues will join me in opposing this trifecta. Don't
buy a ticket on this race, because it is a loser.
Mr. REID. Mr. President, I yield 5 minutes to the distinguished
Senator from North Dakota, the ranking member of the Budget Committee.
Mr. CONRAD. Mr. President, I thank the leader for this time.
We have heard a lot of talk that there is a death tax in this
country. All of us in this Chamber know there is no death tax. There is
a tax that applies to estates that wealthy individuals have in this
country, but only three-tenths of 1 percent of estates pay any tax in
America.
This shows the current level of exemptions. In 2006 a couple has to
have $4 million before they pay a penny of estate tax. In 2009, that
will rise to $7 million for a couple. Some of us believe we ought to
increase the exemption before 2009 to this $7 million level, but that
is not the proposal before us.
The proposal before us is to virtually eliminate the estate tax or
certainly the revenue that flows from it. In fact, as my colleague from
Illinois just indicated, the proposal before us will cost us three-
quarters of the money that complete elimination of the estate tax would
cost: $750 billion in the first 10 years that it is fully effective.
This at a time that we are borrowing money as a nation in an
unprecedented way.
Last year we borrowed 65 percent of all the money that was borrowed
by countries in the world. Let me repeat that. Last year, our country,
which has now become the biggest debtor nation in the world, borrowed
65 percent of all of the money that was borrowed by all the countries
in the world--65 percent. A very weak second was Spain at 6.8 percent,
and the United Kingdom at less than 4 percent.
The point is very clear. This is absolutely unaffordable at a time
that we are running up massive debt.
Our friends on the other side say: Well, we have a good idea. Let's
eliminate some more revenue and let's eliminate it on those who are the
wealthiest three-tenths of 1 percent of the American population.
If anybody wonders about the budgetary impacts or whether this is
fiscally responsible, here are the budget points of order that this
legislation before us now violates. It violates the pay-go rule. It
exceeds the pay-go scorecard by more than $12 billion.
On revenue, it exceeds the 2006 through 2010 revenue floor by more
than $6 billion. It exceeds the outlay allocation for 2006 and 2006
through 2010 for the Finance Committee by $1.5 billion. It contains
unfunded mandates on State and local governments that are all subject
to a point of order.
It reduces the Social Security surpluses, also subject to a point of
order.
Let me just say to my colleagues, if this measure would pass tonight
and cloture would be invoked, I intend to raise every single one of
these budget points of order, and we will see who is serious about
being fiscally responsible and who is not.
I have shown this chart to my colleagues many times. It took 42
Presidents--all the Presidents pictured here--224 years to run up $1
trillion of debt held abroad. This President has more than doubled that
amount in just 5 years.
What are our colleagues saying? Our colleagues are saying: Let's go
borrow some more money from abroad. Where are we going to get this
money? The country we borrow the most from is Japan, so a lot of this
money would be borrowed from Japan. The next country that we owe the
most money to is China, so we would have to borrow more money from the
Chinese to give this tax reduction to just a handful of Americans.
Right now, there will only be 13,000 taxable estates in the entire
country in 2006. By 2009, that will be down to 7,000. When our friends
call this family prosperity, they are right. They are talking about
family prosperity for 7,000 families in America, and they want to shift
the burden on to all of the other American families. That is what this
is about.
If you are listening to this debate, if you have assets----
The PRESIDING OFFICER. The Senator's time has expired.
Mr. CONRAD. Mr. President, I ask unanimous consent for 30 more
seconds.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CONRAD. If you have assets of more than $7 million, it is true,
you will face a tax. If you have assets and you are a family, if you
have more than $7 million, you will face a tax. Now, that is the only
instance in which you will.
My friends, the proposal before us is to reduce--for 7,000 families
in America who are in that category in any one year--reduce their
obligation and shift it to all of the rest of us. That is not fair.
That is not right.
The PRESIDING OFFICER (Mr. Ensign). The Democratic leader is
recognized.
Mr. REID. Mr. President, I would say through the chairman to my
distinguished friend, that is a net estate; it is not 7 million worth
of property.
First of all, I would like to extend my compliments to Charles
Grassley, the senior Senator from Iowa, a gentleman farmer who we are
so fortunate to have in the Senate. He, in his gentlemanly way,
indicated in his speech tonight how terribly upset he was for what
happened a week ago. We had this all worked out. The conference was
completed. The extenders would have been done. The pension bill would
have been passed.
Senator Baucus, who has been a partner with Senator Grassley for a
long time, is not here tonight. As we speak, he is in Dover, DE,
meeting his brother and his nephew, Philip. Philip is in a casket,
having arrived from Iraq where he was killed.
Max Baucus would like to be here, but we are going to have printed in
the Record what Max Baucus said:
Political games congressional leaders played with this bill
are not the way to get the job done. I hope that cooler heads
can
[[Page S8730]]
prevail and we can work together for sensible reform in the
future.
My distinguished friend, the majority leader, has placed a name on
this legislation called the Family Prosperity Act. I suggest that it
should be called the Prosperous Family Act. This legislation would only
help the prosperous--only the prosperous. This should be called the
Prosperous Family Act.
Sunday's Washington Post had a quote from my friend--and I know a
friend of the distinguished Presiding Officer--Tennessee Congressman
Zach Wamp. In this column he is quoted about why Democrats don't
support the bill we are about to vote on. Congressman Wamp said: I know
why Democrats are mad. We've outfoxed them.
Again:
I know why you're mad. You have seen us really outfox you.
It is not us, the Democrats, they tried to outfox; it is the American
people. There is just one problem with this Republican legislation,
this Republican shell game, this trick--the American people will not
fall for it. As my colleague, Senator Durbin, said: This is a bet, and
a bad one. The American people simply are too smart to be outfoxed.
Americans are too smart to be tricked into cutting the wages of 136,000
Nevadans, and more than a million, by far, people in Oregon,
Washington, Montana, California, Nevada. Those States, under this so-
called Family Prosperity Act, would give less to those families who are
struggling, struggling every day. In Nevada there are 136,000 of them.
They work for minimum wage. If they work 40 hours a week, 52 weeks a
year, they make $10,700, plus some tips in those seven States. But not
under this bill. In seven States, the poorest of the poor would get a
pay cut. They would get a pay cut so that 8,100 multimillionaires can
enjoy almost $800 billion in tax breaks.
Americans are too smart to be tricked into forgoing middle-class tax
revenue so America can borrow hundreds of billions of dollars to give
tax breaks to the wealthy few. Americans are too smart to accept any
more debt and deception from this do-nothing Congress.
Here we are at 9:20, finishing this work session. The Defense bill
isn't complete. The pension bill isn't complete. I hope it will be
within an hour and a half or so. Middle-class tax relief isn't
complete, the so-called extenders. Minimum wage has not been made
possible for almost 10 years. Why? Because the majority doesn't believe
in it. They don't believe in having a decent standard of living for the
poor. Let the free market decide.
But, remember, the people drawing minimum wage are not kids at
McDonald's flipping hamburgers. Sixty percent of the people drawing
minimum wage are women, and for the vast majority of those women, that
is the only money they get for them and their families. Not only do
they have a tax cut for those seven States for the poorest of the poor,
it is phased in over 3 years.
So the leader has said: OK, you accept this; take this or leave it.
If you don't accept this, we are not going to do the extenders and we
are not going to do pensions.
We have worked that out. Thank goodness we have been able to do the
pensions. And we are certainly not going to do the minimum wage. We
knew that. We know they don't like a minimum wage.
But it is a threat, and it is a perfect metaphor for this do-nothing
Congress. For the last 19 months, congressional Republicans have done
nothing for the people. The little they have done on behalf of special
interests and the well connected has made America less safe and the
life of the middle class much more difficult.
Look at the record. This Congress will be remembered more for
interfering in the Terry Schiavo case than it will for trying to solve
America's health care crisis. On every major issue, the Republican
Senate has been missing in action.
Look at Iraq. Look at Iraq. Tens of billions of dollars to repair the
equipment and machinery our fighting forces use; these gallant men and
women--about 2,600 of them having been killed and more than 20,000
wounded, a third of them grievously, and hundreds of billions of
dollars more in red ink. What we have said is please change course. But
on party-line votes: No.
In fact, the situation is being made worse by rubberstamping
President Bush's failed policies and allowing him to stay the course,
even as the evidence suggests we desperately need to change course.
It is the same on the economy. We live in a very stressful economic
situation. Over the last 6 years, the rich have gotten richer, the poor
have gotten poorer, and the middle class is being squeezed. Even the
administration admits their policies have failed for working Americans.
Listen to what the Secretary of Treasury had to say the day before
yesterday, Hank Paulson.
Amid this country's strong economic expansion, many
Americans simply aren't feeling the benefits. . . . Many
aren't seeing significant increases in their take-home pay.
Their increases in wages are being eaten up by high energy
prices and rising health care costs, among others.
The Secretary of Treasury said it. Has the Republican Congress done
anything to turn this situation around? No. In fact they are seeking to
make matters worse with the Prosperous Family Act--the Prosperous
Family Act.
This bill, as I said, will cut the wages of millions of people, most
of them in the West. This bill will add to the bankruptcy coming about
of our country, as expressed by the ranking member of the Budget
Committee, Senator Conrad. It will add almost $1 trillion to the debt--
$1 trillion.
Oh, well, not really. It is $200 billion less than that.
We are told by the other side that with this trifecta--which we have
nicknamed the ``defecta''--8,100 of the wealthy and well-off hit the
jackpot while millions of working families get $800 billion in debt. It
is another example of this do-nothing Congress putting their political
interests ahead of America's interests.
We keep hearing from the other side how the Senate needs to repeal
the estate tax to preserve and protect small businesses and family
farms. That is a myth. Very few small businesses or family farms pay
any estate tax.
The State of California is a State of 35 million people. The State of
California is the breadbasket of this country. They grow so many things
in the Imperial Valley and other places throughout California.
Senator Dianne Feinstein asked the Farm Bureau, which supports repeal
of the estate tax: Tell us how many farms were lost by families because
of the estate tax.
None. None. Over a 10-year period of time--none.
It is the same with small businesses. In fact, the Small Business
Council of America has said that the repeal of the estate tax will
actually harm most small business owners because of how it will change
the tax benefits they currently receive.
I am all for fixing the estate tax. I have said so. But there is no
reason for this fiscal irresponsibility, And it is a virtual repeal.
I talked this morning for a little while about two of the richest men
in the world. The richest man in the world, Warren Buffett, he is
totally opposed to repealing the estate tax, as well as the Gates
family. Pierre Omidyar lives in Las Vegas, NV--Henderson, actually--a
rich man, worth over $10 billion. He is a young man. He is the man who
invented eBay. The first time I had dinner with him he said: Whatever
you do, don't mess around with the estate tax. I owe my country the
prosperity that I have.
In fact, I had a conversation yesterday with the head of the Business
Roundtable. He said that all he cares about in the trifecta, the
Prosperous Family Act--or the ``defecta''--is that we do something to
extend the R&D tax credit. That is so important to him, he said. Guess
where the R&D tax credit is. It is being held hostage with this, along
with some of the other add-ons.
The American people deserve more. It is unimaginable that the
Republicans would deny millions of small businesses the research and
development tax credit. It is unimaginable the Republicans would deny
15 million workers a $2.10 raise. It is unimaginable they would deny
millions of middle-class families tax relief with our extenders. If
8,100 of their wealthy
[[Page S8731]]
friends don't get billions of dollars of tax breaks first--nothing.
Soon the Senate will say its last words regarding the estate tax for
this session of Congress, I hope. When this vote is completed, I hope
we move on to the people's business--I will use leader time right now--
and the majority leader will consider his threat to never bring back
middle-class tax relief and the minimum wage back to the floor this
session. If he is serious about that threat, it just can't happen, and
we will fight this. When the Senate returns in November, Democrats will
not go home until the middle-class tax relief package, the extenders,
is passed. My friend can make all the threats he wants, but the Senate
will not adjourn until hard-working Americans get the help they need.
They have to have it. They have waited 19 months. By then it will be
longer.
America needs new direction. I began with a quote by Congressman Zach
Wamp. Here is another thing Republicans have been saying about their
``defecta'' bill. They have been calling it a win-win.
My friend, the majority whip, Senator McConnell, said: ``There's no
risk. It's all reward.''
No risk? Tell that to the millions of workers who have been making
$5.15 for the last 10 years on the verge of waiting another year at
least.
Win-win? Tell that to the millions of middle-class families and small
businesses that will be denied tax relief because Republicans have put
their political interests first.
All reward? Republicans have not outfoxed anyone. The American people
can see through these political games. I am hopeful that the cloture
motion will fail, and I am confident the Republican's cynical approach
to dealing with the needs of our country will be rejected.
Mr. President, I ask unanimous consent that Senator Murray be allowed
to speak for 2 minutes. Is that OK with the majority leader? I have
time left. I know we want to move on.
Mr. FRIST. Yes.
The PRESIDING OFFICER. The Senator from Washington is recognized for
2 minutes.
Mrs. MURRAY. Mr. President, a question has been raised about whether
the minimum wage provision affecting States that allow tips to be
exempt would be impacted by the legislation that is before us. I ask
unanimous consent to have printed in the Record a letter from Gary
Weeks, who is the director of the Washington State Department of Labor
and Industries, that says definitively:
Under our preliminary analysis, this proposal, in effect,
appears to nullify an employer's obligation to pay the
minimum wage rate in RCW 49.46.020 with regard to tipped
employees. This means that Washington workers who receive
tips--typically service industry workers--would see a
decrease in income.
I ask unanimous consent to have that printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
State of Washington,
Department of Labor and Industries,
Olympia, WA, August 3, 2006.
Hon. Patty Murray,
United States Senator,
Russell Senate Office Building, Washington, DC.
Hon. Maria Cantwell,
United States Senator,
Hart Senate Office Building, Washington, DC.
Dear Senators Murray and Cantwell: Your office asked me to
respond to an inquiry as to how the proposed HR 5970 would
affect workers in the state of Washington.
As you know, Washington State does not recognize tips as
part of the minimum wage. Tipped employees are entitled to
the full minimum wage, currently $7.63 an hour. Additionally,
Initiative 688, passed overwhelmingly by voters in 1998, tied
the minimum wage to the Consumer Price Index, to be
recalculated and adjusted each year.
The proposed bill, Section 402 of HR 5970, which amends the
Fair Labor Standards Act to add a paragraph that states:
(2) Notwithstanding any other provision of this Act, any
State or political subdivision of a State which on or after
the date of enactment of the Estate Tax and Extension of Tax
Relief Act of 2006 excludes all of a tipped employee's tips
from being considered as wages in determining if such tipped
employee has been paid the applicable minimum wage rate, may
not establish or enforce the minimum wage rate provisions of
such law, ordinance, regulation, or order in such State or
political subdivision thereof with respect to tipped
employees unless such law, ordinance, regulation, or order is
revised or amended to permit such employee to be paid a wage
by the employee's employer in an amount not less than an
amount equal to--
(A) the cash wage paid such employee which is required
under such law, ordinance, regulation, or order on the date
of enactment of the Estate Tax and Extension of Tax Relief
Act of 2006; and
(B) an additional amount on account of tips received by
such employee which amount is equal to the difference between
the cash wage described in subparagraph (A) and the minimum
wage rate in effect under such law, ordinance, regulation, or
order, or the minimum wage rate in effect under section 6(a),
whichever is higher.
Under our preliminary analysis, this proposal, in effect,
appears to nullify an employer's obligation to pay the
minimum wage rate in RCW 49.46.020 with regard to tipped
employees. This means that Washington workers who receive
tips--typically service industry workers--would see a
decrease in income. However, the proposal does give states
the right to amend their laws to specifically reinstate their
current minimum wage rate laws. Until and unless the
Washington State Legislature amends the minimum wage act to
reinstate the current wage rate provision for tipped
employees, it would diminish workers' rights in Washington
State.
I trust that this is useful information. Please let me know
if I can be of further assistance.
Sincerely,
Gary K. Weeks,
Director.
Mrs. MURRAY. Mr. President, their preliminary analysis shows that
this provision would take away the wages and reduce it dramatically for
waiters and waitresses, bartenders, barbers, baggage porters, cooks,
dishwashers, hairdressers, maids, manicurists, massage therapists,
parking lot attendants, personal care and services workers, service
station attendants, taxi drivers, and chauffeurs.
It appears, indeed, that the provision in this bill will dramatically
reduce the income of thousands of workers in my State and other States.
I again reiterate that is why we are opposed to this bill.
I yield the floor.
Mr. BYRD. Mr. President, important provisions in H.R. 5970 provide a
long-term solution for the Abandoned Mine Land, AML, program as well as
resolve the uncertainty of the health care needs for retired miners and
their families. Right now, there are 52,320 retired miners and their
families nationwide who depend on these critical funds to provide for
their health care needs. At least 17,195, or about one-third of these
people, are in West Virginia. I have also worked for many years to keep
the AML program going for West Virginia and other coal-producing
States. This important program cleans up old mine hazards and improves
the environment in the coalfields. I have always been there to shore up
the funding for our coal miners' health care funds, and I have always
been there for the AML program. The bill before us today is an
opportunity to solve these issues permanently, and I embrace it.
H.R. 5970 would also address the Federal estate tax, something that
the small business owners and farmers of my State have made clear is a
priority for them, and in need of reform. In the past, I have supported
legislation to increase the estate tax exemption, and to lower the top
tax rate, as an alternative to permanent repeal. This bill is
consistent with those past efforts that I have supported.
Senators have raised concerns about the cost of this bill, and its
effect on the Federal budget. The fiscal course of deficits and debt
chosen by the administration is abominable, and I have advocated
tirelessly that the Congress abandon it. But of the budget-busting
measures endorsed by the Congress, this one does not rate top billing.
The revenue loss from the estate tax portion of this bill would not
begin for 3 years, and the effect on the Federal budget would not be
felt until the next decade. Meanwhile, the health care needs of my
State's retired coal miners and their families are immediate and
urgent. I will not vote against those miners who need this assistance
now, based upon budget projections that may not mean much until the
next decade.
This bill would also guarantee a $2.10 increase in the Federal
minimum wage within the next 3 years. Should a new Congress revisit the
issue, I hope that that schedule could be accelerated.
This bill would raise wages for workers who need it the most. It
would provide health care to retired coal miners
[[Page S8732]]
and resolve our Nation's mine reclamation needs. It would codify a
compromise measure that is less than repeal and consistent with
previous efforts to try to reform the estate tax to help small
businesses and farmers.
This is a good bill for West Virginia, and it should receive an up-
or-down vote on this floor.
Mr. KENNEDY. Mr. President, we have seen many outrages from this
Republican Congress but none that demonstrates such utter contempt for
the American people as holding the minimum wage hostage to give tax
giveaways to the wealthiest Americans. The Republican leadership is
playing a cynical game of politics with the lives of millions of
hardworking American families.
It may be a political game for Republicans, but it is hard reality
for low-wage workers who worry every day if they can pay the bills. The
bill is just a bad bargain for minimum wage workers. The minimum wage
increase they receive does not have the same benefits as the Democratic
proposal--1.8 million fewer workers would benefit because the increase
is phased in too slowly.
And what's worse, this Republican bill takes money right out of the
pockets of more than 1 million tipped workers in seven States. It's a
pay cut for maids, waitresses, bellhops, and other Americans who rely
on tips to make a living. The Republican bill would boost the bottom
line for America's restaurants, while taking money away from
hardworking Americans who depend on tips to support themselves and
their families.
Under current Federal law, restaurant owners can pay their waiters
and waitresses as little as only $2.13 an hour, and the rest of their
compensation is supposed to come from tips. The same is true for hotel
maids, parking attendants, bartenders--all workers who rely on tips to
make a living. Federal labor and employment law sets a minimum floor,
but States are free to guarantee higher wages for tipped workers. In
fact, the Fair Labor Standards Act encourages States to enact laws that
are more protective for workers than the Federal law.
Seven States--Alaska, California, Minnesota, Montana, Nevada, Oregon
and Washington--do not allow a ``tip penalty.'' They guarantee that
tipped workers get the full State minimum wage plus any tips they
receive.
But the Republican bill would take power away from the States by
nullifying these State laws providing stronger wage protections for
tipped employees than the Federal standard. In fact, the bill would
change the minimum wage for tipped workers in these seven States,
requiring them to be paid only the Federal minimum wage--not the higher
State minimum wage--until the State enacts a law with a tip penalty.
Under this bill, tipped workers would see drastic reductions in their
take-home pay. A waitress at a family restaurant in Washington State,
for example, will see her hourly wages drop by $5.50 an hour. That's
almost $11,500 per year. A hotel maid in Oregon will see her hourly
wages drop by $5.37 an hour. That's almost $11,200 a year.
Now the Republicans have spent a lot of time on the floor today
trying to explain why this giveaway for the restaurant industry won't
actually hurt American workers. My Republican colleagues--particularly
the junior Senator from Oregon earlier this afternoon--accused
Democrats of misrepresenting what this bill does. And they supported
their claims with a letter authored by the chief lobbyist for the
American Restaurant Industry. But the Republicans' claims that the bill
is harmless just don't hold water--particularly when you look at this
document from the American Restaurant Industry's own website claiming
credit for the tip provision and bragging about how much money it will
save employers. The Republicans know exactly what this provision does--
it takes money out of workers' pockets. It's a scandalous special
interest giveaway to the restaurant industry, and it's outrageous.
When we examine other, less partisan analyses, it's clear that the
bill would do devastating harm to workers. The Congressional Budget
Office says the bill ``would preempt the minimum wage laws of States
that exclude tips from being considered as wages in determining if
certain employees have been paid the minimum wage.'' The Congressional
Research Service says the bill would force the affected States to
choose ``between the federal tip credit requirements or the adoption of
a law that allows for some form of a tip credit under State law.'' Even
the Bureau of Labor and Industries in Senator Smith's home State of
Oregon says that this bill will ``trample States' rights and reduce the
wages of thousands of Oregonians already struggling to make ends
meet.''
I will ask to have all three of these documents printed in the
Record.
But we don't even have to rely on these respected authorities to know
what this bill does. Let's look at the language itself. The bill says,
on page 182, that any State that has a minimum wage law requiring that
tipped workers be paid the full minimum wage plus any tips they receive
``may not establish or enforce the minimum wage rate provisions of such
law, ordinance, regulation, or order in such State or political
subdivision thereof with respect to tipped employees.'' It couldn't be
more clear. The bill is nullifying State laws. Once these State laws
are rendered ineffective, the affected workers will be covered only by
the Federal law and will lose thousands from their paychecks, until and
unless their State enacts a new law that is more to the restaurant
industry's liking.
This is despicable--it is truly Robin Hood in reverse, robbing from
some of the most vulnerable workers on a bill that gives tax cuts to
the rich. Instead of denying more than a million tipped workers the
protections of the minimum wage, we should raise the wage and expand
the protection. The people who work in our restaurants, carry our bags,
and clean our hotel rooms work hard for a living, and they deserve
better.
Everyone in America knows that after 10 long years without one,
minimum wage workers deserve a raise. But this Republican bill is a
cynical ploy to strongarm outrageous tax breaks for the wealthy through
Congress on the backs of America's hardworking, low-wage workers.
Republicans are using minimum wage families as a human shield to
smuggle through tax giveaways. It's wrong. It's unfair. It has no place
in America. And we're not going to let it happen.
Mr. President, I ask unanimous consent to print the documents to
which I referred in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Congressional Research Service,
Washington, DC, August 2, 2006.
Memorandum
To: Hon. Barbara Boxer, Attention: Alexander Hoehn-Saric.
From: Jon O. Shimabukuro, Legislative Attorney, American Law
Division.
Subject: Section 402 of H.R. 5970, the Estate Tax and
Extension of Tax Relief Act of 2006.
This memorandum provides a brief interpretation of section
402 of H.R. 5970, the Estate Tax and Extension of Tax Relief
Act of 2006. Section 402 would amend section 3(m) of the Fair
Labor Standards Act (``FLSA'') to address the treatment of
certain tipped employees. A tipped employee is ``any employee
engaged in an occupation in which he customarily and
regularly receives more than $30 a month in tips.''
Under the FLSA, an employer of a tipped employee is only
required to pay $2.13 per hour in direct wages if that
amount, when coed with the tips received by the employee,
equals at least the federal minimum wage. If the employee's
tips combined with the employer's direct wages of at least
$2.13 per hour do not equal the federal minimum hourly wage,
the employer must make up the difference.
Section 402 of H.R. 5970 would amend the FLSA'' to add the
following paragraph to section 3(m) of the Act:
(2) Notwithstanding any other provision of this Act, any
State or political subdivision of a State which on or after
the date of enactment of the Estate Tax and Extension of Tax
Relief Act of 2006 excludes all of a tipped employee's tips
from being considered as wages in determining if such tipped
employee has been paid the applicable minimum wage rate, may
not establish or enforce the minimum wage rate provisions of
such law, ordinance, regulation, or order in such State or
political subdivision thereof with respect to tipped
employees unless such law, ordinance, regulation, or order is
revised or amended to permit such employee to be paid a wage
by the employee's employer in an amount not less than an
amount equal to--
(A) the cash wage paid such employee which is required
under such law, ordinance, regulation, or order on the date
of enactment of the Estate Tax and Extension of Tax Relief
Act of 2006; and
[[Page S8733]]
(B) an additional amount on account of tips received by
such employee which amount is equal to the difference between
the cash wage described in subparagraph (A) and the minimum
wage rate in effect under such law, ordinance, regulation, or
order, or the minimum wage rate in effect under section 6(a),
whichever is higher.
Seven states do not recognize a tip credit for employers of
tipped employees. In these states, the prescribed minimum
wage is the same for both tipped and non-tipped employees.
Stated differently, in these states, none of a tipped
employees tips may be considered for purposes of determining
if such employee has been paid the applicable minimum wage
rate. Under the proposed language, such states would seem to
be prohibited from enforcing the minimum wage rate provisions
of their laws with respect to a tipped employee unless such
laws are ``revised or amended to permit such employee to be
paid a wage by the employee's employer in an amount not less
than'' what is prescribed in the proposed subparagraphs (A)
and (B).
Under general principles of statutory construction, the
meaning of a statute must, in the first instance, be sought
in the language in which the act is framed. If the language
is plain, a reviewing court will enforce it according to its
terms. In this case, the proposed language would seem to
refer clearly to those states that exclude ``all of a tipped
employee's tips from being considered as wages in determining
if such tipped employee has been paid the applicable minimum
wage rate.'' California, as one of seven states that does not
recognize a tip credit, would probably be affected by the
enactment of the proposed language. As an affected state,
California would appear to be unable to enforce its minimum
wage rate laws with respect to tipped employees until it
``revised or amended'' such laws to permit tipped employees
to be paid a wage that conforms to subparagraphs (A) and (B)
of the proposed language. Thus, if enacted, California would
appear to have to choose between the federal tip credit
requirements or adopt a law that allows for some form of a
tip credit under state law.
____
U.S. Congress,
Congressional Budget Office,
Washington, DC, August 1, 2006.
Hon. Judd Gregg,
Chairman, Committee on the Budget, U.S. Senate, Washington,
DC.
Dear Mr. Chairman: As you requested, the Congressional
Budget Office, CBO, and the Joint Committee on Taxation, JCT,
have estimated the direct spending and revenue effects of
H.R. 5970, the Estate Tax and Extension of Tax Relief Act of
2006.
The legislation would increase the estate and gift tax
exemption amounts and reduce the rates, as well as extend and
modify various other tax relief provisions. It also would
make several changes to the Surface Mining Control and
Reclamation Act, and it would increase the minimum wage. JCT
and CBO estimate that the legislation would decrease revenues
by $15.4 billion in 2007, by $48.1 billion over the next five
years, and by $302.4 billion through 2016. CBO and JCT
estimate that, under the bill, direct spending would increase
by $83 million in 2006, by $3.8 billion over the 2007-2011
period, and by $7.3 billion over the 2007-2016 period.
For some budget enforcement procedures, the relevant budget
periods are 2006-2010 and 2006-2015. Therefore, we are
providing those summarized totals as well. CBO and JCT
estimate that enacting this legislation would decrease
revenues by $32.524 billion over the 2006-2010 period and by
$240.664 billion over the 2006-2015 period. The act would
increase direct spending for those periods by $3.008 billion
and $6.866 billion, respectively.
The estimated budgetary impact of the act is shown in the
attached table.
CBO has reviewed the non-tax provisions of the
legislation--subtitle A of title III and all of title IV--for
mandates and has determined that title III contains a
private-sector mandate and title IV contains both
intergovernmental and private-sector mandates as defined in
the Unfunded Mandates Reform Act, UMRA. CBO estimates those
mandates would impose costs that exceed the annual thresholds
established in that act ($64 million for intergovernmental
mandates and $128 million for private-sector mandates, in
2006 adjusted annually for inflation.)
JCT did not review the tax provisions of H.R. 5970 for
mandates.
Pursuant to section 407 of H. Con. Res. 95 (the Concurrent
Resolution on the Budget, Fiscal Year 2006), CBO estimates
that enacting H.R. 5970 would not cause an increase in direct
spending greater than $5 billion in any of the 10-year
periods between 2016 and 2055. (Direct spending would exceed
$5 billion over the 2007-2016 period, primarily because of
amendments to the Surface Mining Control and Reclamation Act,
but these effects would be significantly lower for subsequent
10-year periods.)
Revenues
H.R. 5970 would make several changes to tax law, resulting
in decreases in federal revenues. JCT and CBO estimate that
the legislation would decrease revenues by $15.4 billion in
2007, by $48.1 billion over the next five years, and by
$302.4 billion through 2016.
Title I would modify rules related to the estate and gift
taxes. Currently, the effective exemption amount for the
estate tax is larger than that for the gift tax. In 2009,
under current law, the estate exemption will be $3.5 million,
while the gift tax exemption will be $1 million. Under H.R.
5970, the estate and gift exemption amounts would be equal to
each other, as they were prior to enactment of the Economic
Growth and Tax Relief Reconciliation Act of 2001. Further,
the exemption would be increased to $5 million in 2015. The
estate and gift tax rates would be reduced after 2009, and
any unused exemption amounts would be allowed to be used by a
surviving spouse. JCT estimates that this title would reduce
revenues by $14.9 billion over the 2007-2011 period and by
$267.6 billion over the 2007-2016 period.
Title II would extend and modify various tax relief
provisions in current law. JCT and CBO estimate that this
title would reduce revenues by $15.5 billion in 2007, by
$35.3 billion over the 2007-2011 period, and by $38.2 billion
over the 2007-2016 period.
Provisions in title II include:
Modification (January 1, 2007, through December 31, 2007)
and extension (January 1, 2006, through December 31, 2007) of
a research credit of 20 percent of the amount by which a
taxpayer's qualified research expenses exceed the base amount
for that taxable year. JCT estimates that this provision
would reduce revenues by $7.5 billion in 2007, by $16.3
billion over the 2007-2011 period, and by $16.5 billion over
the 2007-2016 period.
Extension for two years of 15-year straight-line cost
recovery for qualified restaurant property and leasehold
improvement property through December 31, 2007. JCT estimates
that this provision would decrease revenues by $418 million
in 2007, by $2.9 billion over the 2007-2011 period, and by
$5.7 billion over the 2007-2016 period.
Extension for two years of taxpayers' option to deduct
state and local sales taxes instead of state and local income
taxes through December 31, 2007. JCT estimates that this
would reduce revenues by $3.0 billion in 2007 and by $5.5
billion over the 2007-2009 period.
Extension for two years of the deduction for qualified
tuition and other higher education expenses ($2,000 to
$4,000, depending on gross income) through December 31, 2007.
This provision would decrease revenues by an estimated $1.6
billion in 2007 and $1.7 billion in 2008.
Title III would make changes to the Surface Mining Control
and Reclamation Act and the Internal Revenue Code of 1986.
CBO estimates that those provisions would increase net
revenues by $560 million over the 2007-2011 period and by
$1.0 billion over the next 10 years.
These estimates for title III are the net result of two
sets of provisions. CBO estimates that reauthorizing certain
fees charged to companies that produce coal would increase
revenues by $600 million over the 2007-2011 period and by
$1.3 billion over the next 10 years (net of effects on income
and payroll tax receipts). We also estimate that provisions
that affect the financing of retiree benefits for certain
retired coal miners would reduce federal revenues, on net,
primarily by reducing premiums paid by certain coal companies
in the future. Such changes would result in a net revenue
loss of $40 million over the 2007-2011 period and $300
million over the next 10 years.
Direct Spending Effects
H.R. 5970 includes several provisions that would increase
direct spending. CBO and JCT estimate that the bill would
increase outlays by $83 million in 2006, by $3.8 billion over
the 2007-2011 period, and by $7.3 billion over the 2007-2016
period.
The bulk of the new direct spending stems from the Surface
Mining Control and Reclamation Act Amendments of 2006 (title
III). Title III would make several changes to the Surface
Mining Control and Reclamation Act and the Internal Revenue
Code of 1986. CBO estimates that enacting this title would
increase direct spending by $2.1 billion over the 2007-2011
period and by $4.9 billion over the next 10 years. (Such
spending would drop off, though not completely, after 2016.)
Most of the increased spending under title III--$3.8
billion over the next 10 years--would be payments by the
Department of the Interior to states, primarily to support
efforts to reclaim land that has been mined for coal and for
other public purposes. (Roughly $2 billion of that amount
would come from the general fund of the Treasury; additional
amounts would come primarily from revenues collected as a
result of the legislation.) An additional $1.1 billion would
be spent under the legislation for health benefits of certain
retired coal miners and their dependents and survivors who
are eligible to receive retiree health benefits through the
United Mine Workers of America Benefit Funds.
H.R. 5970 also would affect outlays by:
Instituting a refundable tax credit against the individual
alternative minimum tax, which JCT estimates would increase
outlays by $1.0 billion over the 2007-2011 period and $1.2
billion over the 2007-2016 period.
Authorizing, in effect, New York City or the state of New
York to spend certain federal tax withholding amounts, which
CBO estimates would increase spending by $1.0 billion over
the 2007-2016 period.
Extending for two years, through the end of 2007, the
payment to the treasuries of Puerto Rico and the Virgin
Islands of certain amount of excise taxes on imported
distilled spirits. CBO estimates this provision would
increase outlays by $83 million in 2006 and $95 million
over the 2007-2008 period, assuming that H.R. 5970 is
enacted in August 2006.
Adding to the existing list of taxab1e vaccines two
additional vaccines, which CBO estimates would result in
increases in spending of $60 million over the 2007-2016
period because some of the proceeds of the excise tax
[[Page S8734]]
are paid as compensation to injured individuals and some of
the vaccines are purchased by Medicaid.
Extending for one year the option for individuals to
include combat pay in earned income for purposes of the
earned income credit, which JCT estimates would increase
refundable outlays by $10 million in 2008.
Intergovernmental and Private-Sector Mandates
JCT did not review the tax provisions of H.R. 5970 for
mandates.
CBO has reviewed the non-tax provisions of the bill--
subtitle A of title III and all of title IV--for mandates and
has determined that title III contains a private-sector
mandate and title IV contains both intergovernmental and
private-sector mandates as defined in UMRA. CBO estimates
those mandates would impose costs that exceed the annual
thresholds established in that act ($64 million for
intergovernmental mandates and $128 million for private
sector mandates, in 2006 adjusted annually for inflation.)
Specifically, section 312 of title III would create a
mandate by requiring certain firms that currently pay for
health benefits for retired coal miners (and their dependents
and survivors) through collectively bargained agreements to
make additional payments for those benefits in specified
years. At the same time, other provisions would generate
significant reductions in financial obligations existing
under current law with regard to payments for retiree health
benefits.
In addition, section 401 of title IV would amend the Fair
Labor Standards Act to increase the federal minimum wage in
three steps from $5.15 per hour to $7.25 per hour. The
provision would impose mandates, as defined in UMRA, on state
and local governments, Indian tribes, and private-sector
employers because it would require them to pay higher wages
than they are required to pay under current law. CBO
estimates that the costs to state, local, and tribal
governments and to the private sector would exceed the
thresholds established in UMRA.
Finally, section 402 of title IV would preempt the minimum
wage laws of states that exclude tips from being considered
as wages in determining if certain employees have been paid
the applicable minimum wage rate. That preemption would be
considered an intergovernmental mandate as defined in UMRA;
CBO estimates, however, that this mandate would not impose
significant additional costs on states.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact for this
estimate is Emily Schlect.
Sincerely,
Donald B. Marron,
Acting Director.
____
ESTIMATED CHANGES IN DIRECT SPENDING AND REVENUES UNDER H.R. 5970, THE ESTATE TAX AND EXTENSION OF TAX RELIEF ACT OF 2006
(By fiscal year, in millions of dollars)
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2007- 2011 2007-2016
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN REVENUES
Title I: Estate and Gift Tax Effective Exclusion Amount........ 0 0 0 0 -803 -14,096 -39,186 -44,073 -50,598 -57,157 -61,684 -14,899 -267,596
Title II: Extension and Expansion of Certain Tax Relief 0 -15,442 -10,211 -3,956 -2,572 -1,582 -838 -435 -382 -282 -142 -33,766 -35,847
Provisions....................................................
Title III: Surface Mining E Control and Reclamation Act 0 30 160 150 120 100 110 90 90 90 90 560 1,030
Amendments....................................................
Total Changes in Revenues...................................... 0 -15,412 -10,051 -3,806 -3,255 -15,578 -39,914 -44,418 -50,890 -57,349 -61,736 -48,105 -302,413
On-budget.................................................. 0 -15,410 -10,041 -3,805 -3,255 -15,578 -39,914 -44,418 -50,890 -57,349 -61,736 -48,092 -302,400
Off-budget................................................. 0 -2 -10 -1 0 0 0 0 0 0 0 -13 -13
CHANGES IN DIRECT SPENDING
Surface Mining Control and Reclamation Act Amendments:
Budget Authority........................................... 0 40 460 480 580 590 650 660 630 430 430 2,150 4,950
Outlays.................................................... 0 40 450 480 570 590 640 660 630 420 430 2,130 4,910
Refundable AMT Credits:
Budget Authority........................................... 0 0 349 283 224 174 128 86 0 0 0 1,030 1,244
Outlays.................................................... 0 0 349 283 224 174 128 86 0 0 0 1,030 1,244
Spending Authorized for New York:
Budget Authority........................................... 0 40 160 0 200 100 100 100 100 100 100 500 1,000
Outlays.................................................... 0 40 160 0 200 100 100 100 100 100 100 500 1,000
Cover-over of Tax on Distilled Spirits:
Budget Authority........................................... 83 77 18 0 0 0 0 0 0 0 0 95 95
Outlays.................................................... 83 77 18 0 0 0 0 0 0 0 0 95 95
Meningococcal Vaccine:
Budget Authority........................................... 0 2 3 3 3 3 3 3 3 4 4 16 33
Outlays.................................................... 0 2 3 3 3 3 3 3 3 4 4 16 33
HPV Vaccine:
Budget Authority........................................... 0 1 4 4 3 3 3 3 3 2 2 14 27
Outlays.................................................... 0 1 4 4 3 3 3 3 3 2 2 14 27
Extend Option to Include Combat Pay in Earned Income:
Budget Authority........................................... 0 0 10 0 0 0 0 0 0 0 0 10 10
Outlays.................................................... 0 0 10 0 0 0 0 0 0 0 0 10 10
Total Changes in Direct Spending:
Budget Authority........................................... 83 160 1,005 770 1,010 870 884 852 736 536 536 3,815 7,359
Outlays.................................................... 83 160 995 770 1,000 870 874 852 736 526 536 3,795 7,319
NET INCREASE IN BUDGET DEFICIT
Net Change in Deficit.......................................... 83 15,572 11,046 4,576 4,255 16,448 40,788 45,270 51,626 57,875 62,272 51,900 309,732
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Notes: Components may not add to totals because of rounding. AMT = Alternative Minimum Tax. HPV = Human papillomavirus.
Sources: Congressional Budget Office and Joint Committee on Taxation.
____
Bureau of Labor and Industries,
Salem, OR, August 6, 2006.
Hon. Gordon Smith,
Russell Building,
Washington, DC.
Dear Senator Smith: I am writing to urge you in the
strongest possible terms to cast a ``No'' vote on H.R. 5970.
As Oregon's Labor Commissioner, I am infuriated by this move
by the House of Representatives to trample states' rights and
reduce the wages of thousands of Oregonians already
struggling to make ends meet.
I am speaking, of course, of the provision in the bill
imposing a ``tip credit'' upon an estimated 65,000 minimum-
wage workers in Oregon. It is estimated that each of these
workers--waiters, waitresses, bartenders etc.--stand to lose
on average $11,000 annually should this bill pass and become
law.
As you know, I am a long-time champion of Oregon's minimum
wage and was one of the petitioners in the successful ballot
effort to link our state minimum wage to rises in inflation.
Each year, it is one of my proudest duties as state labor
commissioner to not only regulate the payment of minimum
wages to workers, but to set the new wage rate. However,
while I agree with the original efforts of lawmakers to raise
the federal minimum wage above the current, embarrassing
level of $5.l5 per hour, the political hijacking of that
effort has now resulted in a bill that will hurt, rather than
help, average, hard-working Oregonians.
I would also appeal to your longstanding advocacy of
states' rights on a variety of issues. Why would you and your
colleagues waver from that stance when it comes to Oregon's
minimum wage?
For all these reasons, I strongly urge you to vote against
the ill-conceived and potentially damaging piece of
legislation. All working Oregonians will thank you for
protecting their right to provide for themselves and their
families. I thank you for your consideration.
Sincerely,
Dan Gardner,
Commissioner.
____
Mr. LAUTENBERG. Mr. President, we have very few hours before we
depart for the August break. Let's say we have 6 hours--360 minutes--
before we leave to campaign or vacation or meet with constituents back
home.
How are we going to use 360 minutes?
The Republican leadership's idea is to use that precious time to pass
the so-called ``trifecta'' bill. It's a bill that was sent to us from
the House, and I think it symbolizes all that is wrong with the
Republican Congress.
For one, it is a cynical ruse. This bill holds the minimum wage
hostage in exchange for a dramatic reduction in the
[[Page S8735]]
inheritance tax--which only the richest families in America pay.
The minimum wage has been stuck at $5.15 for almost a decade. That's
$10,712 a year.
And even though the Republican leadership has blocked a clean vote on
the minimum wage for years, this ``trifecta'' bill marries the minimum
wage increase with this huge cut in the inheritance tax. This
inheritance tax only affects the richest one-half of 1 percent of
families in the country.
So, in other words, the Republican position is: we will only help
everyday working people in America if you give multi-millionaires and
billionaires a bribe.
Mr. President, that is not the way to govern this country.
This bill is also offensive because it is so out of touch with the
priorities of the American people.
Why aren't we taking steps to actually bring down gas prices? Gas is
over $3 a gallon. It costs $60 to fill a tank for many people. That's
what most Americans are concerned about right now.
Are we going to use these last 360 minutes to deal with that issue?
Meanwhile healthcare is in crisis. We have 43 million people without
health insurance.
And then there is a storm brewing over the new Medicare drug law.
Indications of this storm are appearing in newspapers from Honolulu to
Ho-Ho-Kus. This storm is called the Medicare prescription drug coverage
gap.
Some call this coverage gap the ``Doughnut Hole,'' but that is too
kind a name. It's a much more serious crisis, and can have deadly
consequences.
Here is what is happening across America because of the coverage gap:
millions of seniors on the new Medicare Prescription Drug Plan are
going to the pharmacy counter and experiencing ``sticker shock.'' Why?
Because their drugs suddenly cost four times as much as last month.
Their drugs are costing four times as much because the Republican
Medicare law allows drug plans to include a massive gap in coverage. In
a nutshell, once you pay $750 out of pocket from the deductible and co-
pays, your coverage just stops. And to make matters worse, your
coverage goes away but you still have to pay the monthly premium.
A lot of unhappy seniors are starting to experience this problem, and
it will only get worse through the end of August and into September.
So what are we doing about it?
An inheritance tax break for multi-millionaires is what the
Republican leadership is concerned about while millions of seniors are
facing a financial gap in their prescription drug coverage.
I would like to share some stories with my colleagues from recent
news articles about how this coverage gap is affecting people across
the country.
The Bergen Record in New Jersey told the story of Melba Heck, who is
in the coverage gap. When she started the Medicare Part D plan, she was
paying $50 a month. Now, all of the sudden, the bill is $400.
Ms. Heck, a retired nurse, told the newspaper that ``For the first
time in ten years, I've had to cut back on my church pledge.''
Marcella Crown of Des Plaines, IL, reached the coverage gap back in
April. Her husband said ``Blue Cross is saying that even though she
will get no benefit, she must still pay the premiums. That's
outrageous. We have never had insurance policies that gave us no
benefit yet required us to pay premiums.''
In Maryland, retired teacher Elise Cain walked into her Silver Spring
pharmacy and said she nearly ``passed out'' at the cash register. Her
drug monthly cost jumped from $20 to $175.
These are just some examples of the pain that millions of senior
citizens will have to endure. Unfortunately, this is only the beginning
of this crisis.
We need to deal with this Medicare coverage gap crisis now. If we
wait until September, we do so at our own peril.
Mr. President, this Congress is out of touch, and the Republican
priority is to heap more wealth on a few of the richest people in
America while tens of millions of their hardworking neighbors' children
will struggle to get along with less as a result.
Let's not let it happen.
Mr. REED. Mr. President, I am deeply concerned about the cynical
efforts to tie a much needed boost in the minimum wage to a massive tax
cut for the heirs of the wealthiest Americans.
The economic disparities between minimum wage workers and wealthy
people whose large estates are subject to the estate tax are so vast
that pairing these two measures together defies logic. I am also hard
pressed to find a link between either of these issues and the extension
of several expiring tax provisions that have been tacked on as well.
No matter how my colleagues in the majority try to dress it up, this
is really just another vote on the estate tax. It was less than two
months ago that full repeal of the estate tax failed to pass in the
Senate. Instead of addressing the pressing problems ordinary Americans
face on a range of economic issues, the leadership is back again trying
to pass near-elimination of the estate tax.
The estate tax is an important component of our progressive federal
tax system, it is the Federal Government's only tax on wealth, and by
2009 less than one-half of one percent of all estates will be subject
to the tax. Far from being a ``death tax,'' the tax falls on heirs who
seldom had any real role in earning the wealth built up by the estate
holder. The decedent's estate pays a portion of the total assets to the
Federal Government and the remainder is then passed on to heirs.
Capital gains that have built up in the estate tax free are passed on
to the heirs on a ``stepped up'' basis, and the heirs are not liable
for any income tax on these gains. No tax is levied if the estate
passes to a spouse or is donated to charity. The overwhelming majority
of estates pay no federal estate tax.
As a matter of fact, the non-partisan Tax Policy Center estimates
that only about 8,200 estates would owe any estate tax in 2011 if the
2009 exemption level of $3.5 million were made permanent. Those are the
people who would benefit from further cuts in the estate tax and their
estimated average tax savings is about $1.3 million--a far cry from the
$2.10 hourly wage increase that the Majority has put on the table for
minimum wage workers.
A minimum wage hike is long overdue. The Federal minimum wage, which
today stands at $5.15 per hour, hasn't been raised since 1997. Since
then, inflation has not only wiped out that pay increase but brought
the real value of the minimum wage to its lowest level in half a
century. Over the past 9 years, the minimum wage has lost one-fifth of
its purchasing power.
The majority's plan would increase the minimum wage from $5.15 to
$7.25 per hour by the middle of 2009. The Economic Policy Institute
estimates that 5.9 million workers would benefit directly from the
increase and that the average benefit would be $1,200 per year. Another
7.1 million workers earning somewhat more than $7.25 per hour could
benefit indirectly as a ``spillover benefit'' of the minimum wage
increase. However, 1.8 million fewer workers would benefit under the
Republican proposal because it phases in the increase over a 3-year
period rather than the 2-year phase-in under Senator Kennedy's
proposal.
Senator Kennedy's minimum wage legislation, which I have cosponsored,
also does not contain any poison pills, such as the near-elimination of
the estate tax or the egregious roll back of State pay protections for
minimum wage workers. Currently, there are seven States that have
chosen not to include a tip penalty in their minimum wage laws. Thus,
tipped employees in these States earn the full State minimum wage.
Under the Republican bill, however, one million tipped employees in
these seven States will see a drastic cut in their base pay.
Raising the minimum wage is vital because workers have been left out
of the economic growth we have seen so far in this recovery. Strong
productivity growth has translated into higher profits for businesses,
not more take home pay for workers. The stagnation of earnings in the
face of soaring prices for gasoline, home heating, food, health care
and college tuition is squeezing workers' paychecks. Just this week,
the administration admitted as much. At a speech at Columbia Business
School, Treasury Secretary Paulson stated that ``amid this country's
strong economic expansion, many Americans simply aren't feeling the
benefits. Many aren't seeing significant
[[Page S8736]]
increases in their take home pay. Their increases in wages are being
eaten up by high energy prices and rising health costs.''
No one who works full time should have to live in poverty, but the
current minimum wage isn't enough to bring even a single parent with
one child over the poverty line--even if the parent works 40 hours a
week, 52 weeks a year. Five million more Americans have fallen into
poverty since President Bush took office--37 million Americans are now
living in poverty, including 13 million children.
The minimum wage is an important policy tool to lift low-income
families out of poverty. Almost two-thirds of those who would benefit
are adult workers, and more than a third of these adults are sole
breadwinners for their families. This is not pocket change for
teenagers, as opponents of the wage floor have argued.
The devastation of Hurricanes Katrina and Rita last September put the
national spotlight on the problem of poverty in America. As Senator
Grassley, chairman of the Finance Committee, put it last year, ``It's a
little unseemly to be talking about eliminating the estate tax at a
time when people are suffering.''
While the minimum wage has steadily lost purchasing power over the
past 9 years, Federal Reserve data show that over roughly the same
period the inflation-adjusted average net worth of the 10 percent
families with the greatest wealth increased by almost 40 percent. The
wealth of those most likely to have estate tax liability has increased
substantially, but the taxes owed on an estate of any given size are
lower now than they were in 1997 because of increases in the exclusion
and reductions in the tax rate.
The differences in economic circumstances between those at the very
top of the income or wealth distribution and those at the bottom are
vast and widening. Again, during his address in New York, Treasury
Secretary Paulson stressed that ``addressing issues of wage growth and
uneven income distribution is a longer-term challenge that we can
address.'' And yet, again the rhetoric of this administration does not
match its actions. The consideration of this bill before us today is
proof that the majority and the administration are not serious about
addressing disparities.
Looking at earnings, minimum wage workers make about $206 for a 40-
hour week at the current rate of $5.15 per hour. That would put them in
the bottom 10 percent of the distribution of usual weekly earnings of
full-time workers and these workers have suffered the largest declines
over the past 5 years. Those at the upper-income levels are seeing
earnings gains but for those at the bottom- and middle-income levels,
there is a loss in real earnings since the President took office
whereas in the 1990s, when you saw the proverbial picket fence--there
were positive gains at every percentile.
Turning to household wealth, an overwhelming majority of households
have very little in the way of accumulated wealth and assets and would
not be subject to the estate tax. Households in the bottom fifth of the
wealth distribution have a median wealth of just $2,000. In contrast,
households in the top 10 percent have a median wealth of $1.4 million,
which is less than the current estate tax exclusion of $2 million for
an individual or $4 million for a married couple. Because half of the
households in that wealthiest group have less than the median net worth
of the group, most will not owe any estate tax.
The inequity of this proposal is compelling enough, but the budgetary
consequences of nearly eliminating the estate tax make it completely
unpalatable.
The Center on Budget and Policy Priorities estimates that this estate
tax proposal would cost about $600 billion over the 2012-2021 period,
or about $750 billion when the associated debt service costs are
included. That is about three-quarters of the cost of full repeal, but
probably understates the true cost because the latest proposal is not
fully effective until 2015.
We are financing near-repeal of the estate tax with debt, because the
costs will be paid for with borrowed money. Future generations of
taxpayers--minimum wage workers and others who will make significantly
less than the heirs of deceased multimillionaires and billionaires--
will have to repay those funds. The drain on the budget would occur at
the very time that the baby boom generation enters retirement and
rising Social Security and Medicare costs would strain our budget.
Secretary Paulson rightfully identified ``reforming entitlement
programs, advancing energy security and maintaining and strengthening
trade and investment policies that benefit American workers'' as
``longer-term challenges that will face our economy in the years to
come.'' However, as we all know these are challenges that we can only
meet if we have the resources to do so. Making permanent fiscally
irresponsible tax cuts only endanger our abilities to truly address
what should be our national priorities.
Raising the minimum wage will increase the likelihood that minimum-
wage workers will be paying taxes and drawing on fewer government
services. In contrast, virtually eliminating the estate tax will reduce
Federal revenues, increase the budget deficit, and put pressure on
other government programs that contribute to the economic well-being of
lower-income workers, including minimum wage workers.
Today, we are at war and yet there is no sense of the shared
sacrifice that has united this country in past conflicts. Ironically,
the estate tax was first adopted in the nineteenth century to pay for
government shortfalls due to wartime spending. Our military families
are making tremendous sacrifices, and too many of them have made the
ultimate sacrifice in service to our country. With $320 billion
appropriated or pending for Iraq operations to date and more than 2,500
service men and women killed, the human and financial tolls are both
more staggering than imagined.
With mounting war costs, the impending retirement of the baby-boom
generation and deficits as far as the eye can see, due to the
President's irresponsible tax cuts, it is unconscionable to think that
we are going to vote again on gutting one of the most progressive taxes
on the books.
Putting a minimum wage hike that is so necessary for working families
to make ends meet together with an estate tax bill that benefits a few
wealthy heirs reveals a warped set of priorities. The same can be said
for holding hostage a package of tax extenders that all support. Our
focus should be on strengthening the safety net for American families--
whether it's raising the minimum wage or preserving Social Security,
pensions, and health insurance coverage.
I have been a consistent supporter of the minimum wage, but this is a
cruel juxtaposition of policies which I can not support.
Mr. AKAKA. Mr. President, it pains me to have to choose between the
urgent needs of important groups in my constituency, which is why my
decision to oppose cloture on the so-called trifecta bill, combining an
estate tax compromise, minimum wage increase, and tax extenders, is a
difficult one for me. However, it is one that I find to be necessary.
There are some good measures in this bill, particularly in the tax
extenders package. I applaud my colleague in the House, Representative
Neil Abercrombie, for his hard work to reinstate a tax deduction for
spousal travel that is included in this package. It would have a
positive effect on tourism-based economies, such as Hawaii's economy. I
also appreciate the extension of the research an development credit and
higher education above-the-line deduction, among other provisions.
However, on balance, as with so many other large legislative vehicles
that we consider on this floor, it is not enough to convince me to
support the overall package.
I am disheartened that the majority in Congress uses the plight of
our low-income and disadvantaged to better the cause for the wealthiest
among us. For years, I, along with my Democratic colleagues, have
offered amendments and introduced freestanding bills to increase the
national minimum wage rate for our working men and women. If those in
majority leadership are serious about increasing the wage rate, then
they should pass freestanding bills that are currently pending action
in both the Senate and the House of Representatives. This is truly an
outrage that the majority has stooped so
[[Page S8737]]
low to do this, and to take such a cynical view of the support that a
minimum wage increase truly has in our country.
The package before us further disappoints me because its tip
provisions will actually hurt many of those who could use a boost in
wages. Restaurant staff, valets, parking attendants, bartenders, maids,
and others who support themselves or their families on tip wages will
have current protections taken away by this bill. States that want to
guarantee a higher floor for tip wages would see their power to do so
nullified. These hardworking Americans deserve to have the wage
protections that their States want to grant them.
On the estate tax, I have heard most passionately from auto dealers
in Hawaii of the tragedies that could occur if the estate tax is not
eliminated or scaled back. Hawaii, as with other States, has lost
numerous family-owned businesses due to a number of factors. Our auto
dealers, farmers, ranchers, and other family-owned entities fear that
they will not have the resources to keep their businesses in the event
of the deaths of current owners, if the estate tax is not repealed or
rolled back.
All of these concerns are heartfelt. I must assure those who have
written that I have heard them and have taken their experiences and
views into consideration while deciding what position to take on this
matter. I have wanted to help them. However, the vote on cloture on
H.R. 5970 can also be a missed opportunity to serve countless others in
our home States and many who have not yet been born. I am talking about
opposing cloture on a bill that would mortgage future generations by
adding more than $300 billion to already alarming Federal deficits.
According to the Joint Committee on Taxation, provisions to increase
the estate tax exemption and link estate tax rates to the capital gains
tax rate would cost nearly $268 billion over 10 years. Add that to
extensions and expansions of several expiring tax relief provisions,
some of which we must pass, and the bill's cost is $306 billion over 10
years. The minimum wage increase would have a negligible revenue
effect.
My colleague from North Dakota, Senator Conrad, has instructed this
body time and time again on the dire fiscal picture that we are facing
on the federal level. Our Budget Committee ranking member noted
yesterday that our Federal debt increased $551 billion last year and is
projected to increase another $600 billion this year. These figures are
shocking to me, and they will doubtlessly translate into hard decisions
on programs that we already have a hard time funding yet are so
essential to each of our communities.
In fact, the Center on Budget and Policy Priorities notes that,
should pending budget process reforms be put into place, the combined
effect with the implementation of estate tax provisions would be to
force drastic cuts in various entitlement programs that serve seniors,
low-income families, veterans, students, and the disabled. Some of the
programs that CBPP notes would surely be on the chopping block to make
up for estate tax revenue losses include Medicare for seniors, SCHIP
for children, Federal civilian retirement, the earned-income tax credit
for lower income families, the child tax credit, military retirement,
unemployment insurance, Supplemental Security Income for the elderly
and the poor, veterans disability compensation and pensions, Food
Stamps, school lunch and child nutrition, and farm programs.
It is because of drastic impacts like this that I have heard from
hundreds of other constituents who want me to vote to save these
necessary programs and others in education, health care, and social
services that would bear the brunt of further reductions in
discretionary funding. I simply cannot put the needs of many above the
needs of a few, even if they are a well-deserving few, which is why I
cannot support cloture on this package before us.
Once again, the choice to oppose cloture on this measure has been a
tough one for me. It is far better than estate tax repeal in its
projected fiscal outcome, and I thank its authors for their willingness
to compromise to a certain point. However, the bill does not go far
enough for me.
I deeply appreciate hearing the arguments put forth on both sides of
this debate and the work put in on this matter, but I cannot support
this cloture motion.
Mr. JOHNSON. Mr. President, the Senate is considering today an
increase in the minimum wage, a package of tax extenders, and the
repeal of the estate tax. I am highly disturbed and disappointed by the
course that the Senate has chosen to hold badly needed tax cut
extenders and the minimum wage increase hostage to the estate tax bill.
And I find it ironic that the Republican leadership has been referring
to this as a ``trifecta''--betting terminology. It certainly is a
gamble. It is a gamble with the livelihoods and pocketbooks of the
American taxpayer and American worker, and that is surely not what I
was elected to do.
Tying an increase in the minimum wage and important tax extenders to
the estate tax in order to further a political agenda which has
otherwise failed on this issue is outrageous and manipulative, and I
will not support it. And to add insult to injury, the majority leader
has refused to allow his Senate colleagues, who would like to
substantively address these issues, to offer any amendments. This ``my
way or the highway approach'' is quintessential partisan politics.
I would like to be very clear on my position here. I strongly support
an increase in the Federal minimum wage. I supported Senator Kennedy's
amendment to the DOD authorization bill that would have increased the
minimum wage to $7.25 over a 2-year and 2-month period, and I am a
cosponsor of his Fair Minimum Wage Act. I am also a cosponsor of
Senator Clinton's Standing with Minimum Wage Earners Act, S. 2725,
which would raise the Federal minimum wage to $7.25 per hour and link
future increases in the minimum wage to congressional raises. I have
always supported updating the Federal minimum wage in the past and
would like to have the opportunity for an up-or-down vote on the Senate
floor.
The Republican leadership in both the Senate and the House of
Representatives has thus far managed to block an increase in the
minimum wage. Ironically and sadly, that leadership continues to
prioritize tax breaks for America's most fabulously wealthy over an
increase in wages for hard-working families. It just makes no sense. A
minimum wage employee working 40 hours per week, 52 weeks a year, would
earn only $10,700, a figure far below the poverty level for even a two-
person family. Inflation has eroded the buying power of the minimum
wage since it was last increased in 1997. The current minimum wage is
woefully inadequate to provide enough income for workers to afford
decent housing, set aside sufficient funds for a comfortable
retirement, or meet any emergency needs. Increasing the minimum wage is
about both economics and values. I tire of hearing people talk about
``family values'' while at the same time doing little to increase wages
or provide affordable health care and housing.
I also strongly support the package of tax extenders that were left
behind during tax reconciliation. I was disappointed that the final tax
reconciliation measure, H.R. 4297, failed to include provisions that
would allow South Dakotans to deduct their State and local sales taxes.
South Dakota collects more than 50 percent of its revenue from sales
tax assessments. It is unfair to expect South Dakotans to pay an
additional Federal tax liability simply because of the form of taxes my
home State collects, and I strongly favor making the sales tax
deduction a permanent part of the Tax Code. I was also disappointed
that this measure did not include provisions to allow families paying
college tuition to deduct that tuition from their Federal taxes or
teachers to deduct the cost of classroom supplies. These tax cuts are
important to many Americans, and I support them unequivocally, but I
will not allow the Republican leadership to tell me that I can only
give these tax breaks to middle-class Americans by also voting for an
estate tax repeal that will leave our grandchildren hundreds of
billions of dollars of debt.
Additionally, I will support tax cuts that target working Americans,
so long as they are enacted in a fiscally responsible manner with
appropriate revenue offsets. The estate tax noose that has been tied
around this legislative
[[Page S8738]]
package is not in keeping with this philosophy.
While I feel strongly that Congress must act to give some estate tax
permanency and certainty to estate planning, I do not support full
repeal or any measure that would only benefit a tiny number of
fabulously wealthy estates while at the same time being so costly that
it would require massive borrowing from foreign nations and from the
Social Security trust fund in order to write the checks.
Since the Federal Government is already running several hundred
billions of dollars annually in the red as it is, any further tax cuts
and giveaways for America's multimillionaires will require that we
borrow the money to give to them. Increasingly, the borrowing will be
from foreign nations and from Social Security revenues. That also means
that additional tax cuts for the middle-income taxpayers will be almost
impossible and that the middle class and their children will have to
pay higher taxes for decades to pay off the debt service on the
multimillionaire tax cut. That debt service already costs the taxpayers
$1 billion per day.
The estate tax legislation that has come before us thus far has been
unrealistic and costly. I would be supportive of legislation exempting
family farms, ranches, and small businesses from the estate tax. In
fact, in 2001, I voted to do just that. Unfortunately, then, the
Republican party decided to enact legislation that called for, among
other things, a phaseout of the Federal estate tax that provides
complete repeal in 2010 but reverts to an exemption of only $650,000 in
2011. Because of this mistake we have had to have this discussion every
election year since.
Easing taxes on farms, ranches, and small businesses is one thing,
but the total repeal being pushed as a political statement during this
runup to the election season is irresponsible. I believe the Federal
Government ought to be doing more for middle-class and working
families, rather than focusing its attention on the Paris Hilton and
Donald Trump crowd.
Mr. DODD. Mr. President, I rise today to express my serious concerns
with a bill before this body, H.R. 5970, that unnecessarily links a
long-overdue increase in the minimum wage and a broadly-supported
package of tax extenders to an unaffordable and irresponsible cut in
the tax on multimillion-dollar estates.
This so-called ``trifecta'' bill sends a clear message to the
American people about the priorities of the leadership on the other
side of the aisle--priorities that are badly out of step with the needs
of ordinary Americans.
Many of us in this body support fiscally responsible reform of the
estate tax. But compared to most reasonable proposals, the one in this
bill would cost nearly twice as much, while adding very little
additional value.
Over the last several years, the number of Americans affected by the
estate tax has fallen dramatically as the exemption level has been
raised. In 2000, with an exemption of $675,000, there were 50,000
taxable estates. That number has fallen to only 13,000 today, with the
exemption level now standing at $2 million for an individual and $4
million for a couple. In 2009, the exemption will rise to $3.5
million--or $7 million for a couple--and only 7,000 estates will be
subject to the tax. These 7,000 taxable estates represent the largest
three-tenths of 1 percent of estates in America, all of which exceed
$3.5 million in size. By 2009, only this small fraction will owe even a
cent under the estate tax.
Compared to current or 2009 rates, this ``trifecta'' bill would
provide a tax cut for only the largest 8,200 estates in the country.
And the average size of the tax benefit received by each of these
estates would be $1.4 million. Out of a nation of 300 million people,
only the wealthiest 8,200 would gain from this bill's estate tax
proposal, but it would cost the American people $753 billion over the
first decade alone once it has been fully phased in.
The leadership on the other side of the aisle knows that this body
would rightly reject such a gratuitously irresponsible proposal if it
were offered as a stand-alone bill. So the majority leader in this body
and his counterparts in the House of Representatives have decided, in
what amounts to political blackmail, to attach this estate tax measure
to a moving vehicle, the package of tax extenders that includes
provisions like the research and development tax credit that supports
innovation by America's businesses, the tax deduction for college
tuition that helps students and their families pay for the skyrocketing
cost of higher education, and the tax deduction for teacher classroom
expenses, among many other important items.
In effect, the supporters of this ``trifecta'' bill have decided to
hold hostage these important tax provisions, which benefit families and
businesses across the income spectrum, to an estate tax measure that,
on its own, would otherwise be rejected. And in a misguided attempt to
``sweeten the deal'' or provide political cover, they have added a
provision to raise the minimum wage that, itself, is flawed due to the
wage cut it would force upon many employees who earn their pay through
tips.
Many of us in this body have been fighting for years to increase the
minimum wage, only to have our efforts blocked repeatedly. America's
lowest-wage workers have waited far too long for a raise--it has been
10 years, almost to the day, since this body last voted to raise the
minimum wage to $5.15 per hour.
In the time since then, the minimum wage's real buying power has
fallen to its lowest level in 51 years. For a full-time worker, a wage
of $5.15 per hour translates to a yearly income of $10,700--an amount
that is nearly $6,000 below the poverty line for a family of three.
These are working adults, with full-time jobs, who are living in
poverty.
At those wages, these working Americans can barely afford housing and
food. They certainly can't afford adequate health care, child care, or
education needed to lift them out of a low-wage job. With gasoline
prices and other energy costs rising, one wonders how people make ends
meet.
Unfortunately, too many are falling behind.
And too often, the victims are children, whose only fault was to be
born into the wrong family. More than a third of the 37 million
Americans currently living in poverty are children. Through no fault of
their own, these voiceless Americans live day-to-day without adequate
food and shelter, forced to choose between food and rent or medicine or
utilities.
In my State of Connecticut, we have a population of about 3.4 million
people and the perception is that we are a rich State. But we are not
exempt, in Connecticut, from the scourges of poverty and hunger. In
fact, more than 280,000 people in my State, many of them children, are
food insecure--meaning they don't have access at all times to the food
necessary to lead a healthy life. Two of the largest food banks in
Connecticut provide food for more than 350,000 different people each
year. Working people make up 25 percent of those using those emergency
feeding programs. People are working hard and they can't even feed
their families--how is this acceptable?
Raising the minimum wage from $5.15 per hour to $7.25 per hour would
directly boost the earnings of 6.6 million working Americans. It would
also indirectly benefit an estimated 8.3 million additional workers who
currently earn close to $7.25 per hour and would likely see their wages
rise in response to a minimum wage increase.
Some of my colleagues have argued that raising the minimum wage would
harm employers or reduce overall levels of employment, but study after
study has shown these claims to be unfounded. A recent Gallup poll
found that 86 percent of small business owners do not think the minimum
wage negatively affects their business. And a substantial body of
research by well-known economists finds no significant harm to overall
levels of employment based on changes to the minimum wage. So while a
minimum wage increase would dramatically improve the lives of millions
of Americans, the potential costs would be small.
America's lowest-earning working men and women desperately need a
raise--even a small one. But this bill, by tying an increase in the
minimum wage to a costly ``virtual repeal'' of the estate tax, has the
potential to cancel out the good that would be done. By adding $753
billion to the national debt--which already stands at $8.4 trillion--
this estate tax proposal would
[[Page S8739]]
force deep cuts in services for all Americans, regardless of income.
But those who earn the least would likely be hurt the most.
No one who supports raising the minimum wage or approving the
bipartisan package of tax extenders should be fooled into thinking that
this bill represents a serious attempt to help American workers,
businesses, or taxpayers.
The estate tax proposal that has been attached to these important
measures is unaffordable and unnecessary. It would drive us deeper into
debt with foreign creditors, force damaging funding cuts during already
tight budgetary times--not to mention during a time of war--and
increase the burden on our children and grandchildren of paying for our
excess.
For these reasons, Mr. President, I cannot support this irresponsible
legislation, and I urge my colleagues to join me in voting against this
bill.
Mr. OBAMA. Mr. President, I rise to speak about the latest effort to
reduce the estate tax for a small fraction of the wealthiest Americans
at a cost to all Americans of more than $750 billion. This time our
friends in the House of Representatives realized that the Senate would
reject such a reckless policy. So rather than scaling back Paris
Hilton's tax cut to a reasonable level or suggesting a fair way to pay
for their tax cuts, they have done something else. They have decided to
hold an increase in the minimum wage hostage to a fiscally destructive
cut in the estate tax.
This is cynical politics at its worst. This is government by gimmick.
Combining the estate tax with a minimum wage increase and temporary tax
cut extenders is not an example of finding common ground or moving to a
reasonable compromise; this is an example of political coercion. And
the American people are wise to it.
This is simply an attempt to dare members of my party to vote against
an increase in the minimum wage which has been one of our long-time
priorities.
But why should we have to agree to nearly $800 billion of additional
Federal debt--debt that our children and grandchildren will have to pay
back in higher taxes down the road--in order to get a long-overdue wage
increase for those struggling to make ends meet that would have no
negative effect on the Federal budget?
Why should we have to agree to an average tax break of $1.4 million
for several thousand wealthy estates in order to add about $1,200 on
average to the incomes of several million working families?
Why should we have to agree to a permanent reduction in the estate
tax for billionaires when all the tax benefits for students, small
businesses, teachers, and neighborhoods will expire under this bill in
a year or two?
This bill is not the outcome of a robust policy debate or bipartisan
compromise in the public interest. It's not the result of honest
tradeoffs. No. This bill is a cynical ploy to say ``gotcha'' to the
Democrats. At best it's politically clever, but in no way is it smart.
Increasing the minimum wage would make a significant difference in
the lives of this country's most vulnerable workers. The Federal
minimum wage has not been adjusted since 1997 and the proposed increase
really just keeps workers from falling further behind in their struggle
to keep up with inflation. It is shameful that the President and
Congress have not acted sooner to raise the minimum wage.
My colleagues on the other side of the aisle know that. So they have
tied the minimum wage vote to the estate tax. They have tied the fate
of several million working families and their ability to buy food and
gas and school supplies to the ability of wealthy heirs to inherit even
larger estates tax free.
I am confident that the American people will see through this. By
2009, the estate tax will already be repealed for more than 99 percent
of all Americans. For the few estates that are wealthy enough to have
to pay the estate tax, they can make unlimited charitable deductions,
they can pass along at least $7 million to their heirs tax free, they
can take more than a dozen years to pay-off the taxes owed, and the
effective tax rate will be fair and reasonable. We could extend that
status forever, and members of both parties could claim victory and
move on to addressing America's real priorities.
Instead we are here once more, debating tax cuts and adding to
America's debt.
Now let's be honest. This is not about saving small businesses and
family farms. We can reform the estate tax to protect the few farms
that are affected. We can set it at a level where no small business is
ever affected. We can even repeal the estate tax altogether for the
99.5 percent of families with less than $7 million in taxable assets
that means families with assets almost 100 times greater than the
average American household's net worth. That would be compromise. That
would be sensible.
Democrats have offered to reform the estate tax in these ways time
and time again. But over and over, our offers have been refused, which
can only mean that the party in power is really interested in an
unprecedented giveaway to the wealthiest of the wealthy.
And don't think for a minute that there is any plan to pay for this.
Every proposal to enforce pay-as-you-go rules for fiscal responsibility
has been rebuffed. This tax cut will have to be paid for in the years
ahead by higher taxes on working families and reduced public services
in all of our communities. This tax cut will have to be paid for by
higher interest rates on homes and student loans. And this tax cut will
have to be paid for by greater dependence on foreign countries.
It's amazing to me how little the Congress has actually accomplished
this year and how much time we have wasted on the estate tax. You would
think the richest among us were the most oppressed. And even now we are
being blocked from dealing with bipartisan pension legislation, not to
mention dealing with the costs of healthcare, our real homeland
security challenges, or the threat of global warming.
So if the Republicans want to bring up the estate tax yet again to
use it as an election issue later, I say go for it. Because there may
be no better illustration of how we differ in priorities than this
irresponsible vote.
I yield the floor.
Mr. KERRY. Mr. President, a lot has changed in the last 10 years.
Gasoline prices have risen, up 70 percent since President Bush took
office in 2001. Child care costs have risen and now a typical family
can expect to pay almost $10,000 per year for one child, which is more
than the cost of public college tuition. Health care costs are soaring,
and health insurance premiums are skyrocketing. In short, the cost of
everyday life has greatly increased. We in Congress have certainly
taken notice: we have given ourselves a pay raise eight times since
1997, totaling $30,000, and we've given the President pay raises
totaling $200,000. Yet in that time we have failed to give working
Americans a raise by increasing the minimum wage.
Now, facing tough reelection races and a disillusioned public, my
Republican colleagues are finally willing to do something about it, but
only on their terms. Despite the fact that the rich are getting richer
and the poor are getting poorer, my colleagues' ``solution'' to help
American families is to attach the long-overdue minimum wage increase
to an otherwise un-passable estate tax reform bill that will benefit
just a few wealthy families. This is nothing more than political
blackmail. If Congress were genuine about its care for the lives of
hard-working Americans--if we truly believed that any honest American
working a full time job should not have to live in poverty--we would
never condition a minimum raise increase on a windfall for the wealthy.
Since President Bush took office, the number of Americans living in
poverty has increased by 5.4 million, bringing the total to 37 million
Americans who live in poverty today, 13 million of whom are children.
What's even more disturbing is that over 70 percent of children in
poverty live in a home where at least one parent works. So today in
America we have a situation in which millions of children are living in
poverty despite the fact that they live in homes with a working adult.
Among full-time, year-round workers, poverty has increased by 50
percent since the late 1970s.
This may be surprising, but if you take a minute to understand the
situation the picture becomes clear. Consider a single mother of two
working a
[[Page S8740]]
minimum wage job 40 hours a week for 52 weeks a year. Without taking
any time off for illness or vacation, she earns just $10,700 a year,
nearly $6,000 below the Federal poverty line for a family of three. The
current minimum wage equals only 31 percent of the average wage for the
private sector, nonsupervisory workers, the lowest percentage on record
since World War II. In the past 9 years, the purchasing power of the
minimum wage has deteriorated by 20 percent, and today the value of the
minimum wage is as its lowest level since 1955.
What these figures make absolutely clear is that it's long past time
to raise the minimum wage. Just 5 weeks ago, the Senate failed to give
relief to hard-working Americans by increasing the minimum wage. What
has changed? As far as I can tell, two things have changed. First,
Republicans in tight races realized their failure to address the needs
of working Americans would hurt their chances for reelection. Second,
those in favor of repealing the estate tax realized that the likelihood
of doing so was slim to none. So they agreed to increase the minimum
wage to $7.25 over a 3-year period that will benefit millions of
working families, but they would only do so at a cost of $268 billion
in estate tax relief for a few wealthy families.
I think we can all agree that the estate tax law needs to be
revisited. The current policy does not make sense, but neither does
relief that benefits a few. The estate tax relief before us has a long-
term negative impact on our deficit. The 10-year costs from 2012-2021
are $753 billion when interest is included. That is $753 billion that
will be added to the deficit or result in vital programs having their
funding slashed. And there is no discussion now about how to pay for
this bill.
An increase in the minimum wage should not be saddled with an
unrelated, unnecessary, and unfair tax provision. We should pass a
clean minimum wage bill and then work on a bipartisan estate tax bill
that is fiscally responsible and protects most small businesses from
the estate tax.
The legislation before us provides an average tax cut of $1.4 million
to 8,200 estates. A minimum wage increase would provide an average
benefit of $1,200 to 6.6 million hard-working Americans. The package
before us clearly reflects misguided priorities. I cannot think of one
reason why minimum wage legislation should include estate tax relief.
When President Theodore Roosevelt advocated an estate tax nearly a
century ago, he argued that, the ``man of great wealth owes a peculiar
obligation to the state, because he derives special advantage from the
mere existence of government.'' He further advocated that ``[w]e are
bound in honor to refuse to listen to those men who make us desist from
the effort to do away with the inequality, which means injustice; the
inequality of right, opportunity, of privilege. We are bound in honor
to strive to bring ever nearer the day when, as far as is humanly
possible, we shall be able to realize the ideal that each man shall
have an equal opportunity to show the stuff that is in him by the way
in which he renders service.''
We need to return to a society that values hard work. We cannot let
ourselves become a society divided by income inequity. Defeating this
bill is a step in the right direction toward fairness and the
restoration of sane, responsible fiscal policy.
In addition to the minimum wage, the bill before us includes so-
called expiring tax provisions that Congress should pass. There is no
reason we cannot work together to extend expiring provisions such as
the research and development credit and a tax deduction for the cost of
a college education, which expired at the end of 2005. It is
embarrassing that the Senate is leaving for our August recess without
extending these provisions, especially since the capital gains and
dividends rates that did not expire until 2008 have been extended to
2010. The extension of these provisions should not be threatened. The
price of helping families with college education should not be estate
tax relief for the wealthiest estates.
Mr. President, I support raising the minimum wage. I support tax
credits for research development and college education. But I cannot
support them when they are tied to fiscally irresponsible so-called
reforms. I cannot support a bill that continues to put the interests of
the wealthy above the interests of hard-working Americans. If my
colleagues are serious about increasing the minimum wage, I challenge
them to do so in a clean bill. I challenge them to put the best
interests of working Americans front and center. I challenge them to
stand up to this political blackmail and oppose the Estate Tax and
Extension of Tax Relief Act. The American people deserve better than
this.
Mr. LEVIN. Mr. President, this so-called trifecta bill is a bet by
the Republican leadership that the American people will not notice
their strategy to gut the estate tax in order to give the wealthiest
one-half of 1 percent of our families a huge tax break. I hope they
will lose that bet.
The Republicans have tried to sweeten their fiscally reckless
proposal by extending popular tax cuts that have strong support and by
adding an increase in the minimum wage that many of them do not even
want and have opposed repeatedly for years. Republican leaders know
that their estate tax proposal would not pass on its own, so they have
added other provisions that many want in hopes of drawing enough votes
to pass their true goal--more tax cuts for the superrich. Failing that,
the Republican leaders seem willing to settle for having as a talking
point that they tried to increase the minimum wage, even though they
have opposed it year after year.
The American people will not be fooled. They know that many have
fought tooth and nail to increase the minimum wage, and that we will
keep fighting. But we won't be blackmailed into supporting
irresponsible tax cuts by a political gambit.
This estate tax proposal is unfair and unaffordable. Only a tiny
fraction of all estates pay any estate tax. In 2004, only 1 percent of
estates in Michigan and 1.2 percent nationwide paid any estate tax. And
as the amount exempted from the tax continues to rise to $3.5 million
per person in 2009, the percentage gets even smaller. And despite
claims to the contrary, even without this misguided bill, those
families actually subject to the estate tax will still be able to pass
on great wealth to their children.
Once phased in, this so-called ``compromise'' proposal would cost at
least 75 percent as much as repealing the estate tax entirely. In the
first ten-year period in which the proposal would be in full effect, it
would cost nearly $600 billion. The cost would be $750 billion when
interest payments on the additional debt are taken into account.
We simply cannot afford such a massive tax cut that would push us
even further into the deficit ditch. Today, each American citizen's
share of the debt is almost $29,000. As we continue to run up record
yearly deficits, the country's total debt will be more than $11
trillion by 2011, which is $37,000 per person. It is not just reckless
fiscal and economic policy to saddle future generations with this kind
of crushing debt burden; passing this kind of burden to our children
and grandchildren goes against what should be our basic values.
In the words of Republican President Teddy Roosevelt, who proposed
the estate tax: ``[I]nherited economic power is as inconsistent with
the ideals of this generation as inherited political power was
inconsistent with the ideals of the generation which established our
government.''
If we have any hope of getting our Federal budget deficit under
control, eliminating the estate tax for the extremely wealthy is
exactly the wrong thing to do. We need to look out for all of our
citizens, not just the very wealthiest among us. This giveaway to a
tiny fraction of estates will ultimately have to be paid for by steep
cuts in government services or tax increases that will likely impact
far more Americans.
To achieve the goal of more tax cuts for the very few, this bill
holds hostage two critical issues. First, it includes a desperately
needed, though flawed, increase in the minimum wage. And, second, it
has a package of popular tax benefits that includes allowing families
to deduct up to $4,000 in tuition payments and tax credits for research
and development.
Minimum wage workers have not seen a Federal raise for 10 years.
During that same time period, Congress
[[Page S8741]]
raised its own pay eight times. An employee working full-time on
minimum wage earns only $10,712 per year, which is below the Federal
poverty level. It is shameful this Congress find it acceptable that
Americans work hard every day, all year long, at legal jobs and still
languish in poverty.
I have cosponsored a bill that gives the working men and women of
this country the pay raise that they deserve, legislation that would
raise the minimum wage to $7.25 an hour in several increments. If the
majority cared about rewarding the hard work of a large number of
Americans as much as they cared about protecting the enormous wealth of
a few others, there would be a clean vote just on raising the minimum
wage.
Even though the so-called trifecta bill would raise the minimum wage
for many workers, it would also result in a pay cut for many Americans.
It includes a ``tip credit'' provision that really should be called a
tip penalty. The bill allows workers in industries in which tips are
commonplace--such as waiters, waitresses, hotel maids, parking
attendants and bartenders--to receive as little as $2.13 before the
tips.
Although this tip penalty has been Federal law for years, States have
been free to guarantee higher wages to workers in these industries.
This bill would supersede those state laws to permit the lower wages.
This will decrease wages in at least seven States, and it will set a
dangerous precedent by allowing the Federal Government to interfere
with the States to cut the wages of the lowest-paid workers.
This bill also holds captive several important expiring tax
provisions that have broad support and would easily pass on their own.
The provisions include the work opportunity tax credit, which
encourages employers to hire members of targeted groups such as high
risk youth, families receiving food stamps, SSI recipients, and
qualified veterans. Another provision, the welfare-to-work tax credit,
enables employers to claim a credit on the first $10,000 of wages paid
to certain long-term family assistance recipients.
Another provision is the deduction for the expenses of elementary and
secondary school teachers of up to $125 for books and other supplies.
And there is a deduction of up to $4,000 for qualified tuition and
related expenses. There is also a provision that would help shippers on
the Great Lakes.
Finally, the expiring provisions include a critical tax credit for
research and development done here in the U.S. This is an important way
for the Government to help our Nation's economic competitiveness,
especially in the manufacturing sector, which represents nearly two-
thirds of our total private R&D. While the R&D credit's cost of $16
billion for two years is a significant investment by the Government,
each dollar of the credit leads to a significant increase in business
R&D spending, thus spurring economic growth. Congress should enact this
important program on a permanent basis, instead of revisiting it every
year or two, given all the uncertainty that is created by doing so.
It will be shameful if these provisions--which are good for the
economy, important for our people, and supported by this Congress--are
not renewed because of the political gamesmanship on this bill.
Mr. President, we hopefully will not fall for this political trick.
The American people deserve better from their Government.
If the Republican leaders want to pass a minimum wage increase, give
us a clean bill that does that and we'll pass it today. If they want to
extend the popular and reasonable tax provisions that are expiring,
let's work together to do that. But the pending bill would require us
to swallow two poison pills and one aspirin. Hopefully, that
combination will be resoundingly rejected by the Senate.
(At the request of Mr. Reid, the following statement was ordered to
be printed in the Record.)
Mr. BAUCUS. Mr. President, I favor repeal of the estate tax.
The estate tax often forces ranchers and farmers in my home State of
Montana to have to struggle just to pass their land on to their
children. But the political games that Congressional leaders played
with this bill are not the way to get the job done. I hope that cooler
heads can prevail and that we can work together for sensible reform in
the future.
Mr. BIDEN. Mr. President, our country is at war. We face fundamental
challenges to our security at home and abroad. The President himself
has compared our situation to the Cold War, to World War II. Those were
existential struggles, for which we made great sacrifices and which
fundamentally realigned our priorities.
Thousands of American families have paid the ultimate sacrifice, tens
of thousands of our sons and daughters have been wounded. Tens of
thousands more have been put in the line of fire, some of them for
multiple tours of duty.
The war in Iraq alone has lasted longer than World War II, and its
cost, at $315 billion, continues to grow.
Here at home, we face challenges to the American dream--the faith
that hard work would be rewarded with a decent job, a better future for
our children, and secure retirement.
The income of the average American family has not risen in the past 6
years. Global competition from a billion and a half new workers will
change the world our children inherit. American families have virtually
no money left over to save, and private retirement savings are woefully
inadequate to meet the wave of retirees now upon us.
To meet these challenges, we will have to make massive investments in
education and in research to boost the productivity and earnings of
American workers. We need to find alternative fuels to reduce our
dependence on oil that undermines our foreign policy and holds our
economy hostage.
Over 46 million Americans are without health insurance. Only 5
percent of the containers that pass through our ports are inspected for
weapons. Our passenger rail system lacks the basic lighting, fences,
dog patrols, and cameras that could prevent attacks by terrorists we
know have that system in their sights. This is just a short list of the
profound challenges we face as a Nation. We can all think of others.
While our needs multiply, we lack the resources to meet them. Handed
a 10-year surplus of $5.6 trillion, this administration has dragged us
down, through the most dramatic reversal in our Nation's history, into
an additional $3 trillion in debt.
They have doubled our debt to foreign governments. We now owe more
than $2 trillion to Japan, China, and others. We are losing control of
our financial future.
We are borrowing from our own national retirement savings, the Social
Security system. This year alone, we will borrow $177 billion from
Social Security.
Every day we go deeper into debt to foreign governments. Every day we
spend more of our national retirement savings. And every day our basic
needs, from homeland security to our retirement savings to our
children's future--those needs are ignored.
That is the setting, that is the background, those are the
circumstances in which we are now asked to cut taxes on just 7,000 of
the wealthiest heirs in our country--at a cost of over $750 billion in
the first decade it is in effect.
All of that will be borrowed. It is a transfer of $750 billion to the
wealthiest two-tenths of 1 percent of Americans, borrowed from China,
from Japan, from our own Social Security system. Somebody will have to
pay that back.
Our children and our grandchildren will pay that back. It is a
transfer from those with no voice of their own in our system, a
transfer to those whose wealth speaks the loudest.
Under current law, the estate tax will affect fewer than 7,000
estates in the whole country by 2009. That year, a couple will be able
to exempt a $7 million estate from taxes--a $7 million estate will pay
no estate taxes. None.
The Congressional Budget Office has estimated that only 65 family
farms in the whole country will be subject to estate tax at that point,
under current law. Sixty-five farms, period.
Seven thousand of the wealthiest families will be the only ones
paying any estate tax, and only 65 of those estates will be family
farms, barely more than 1 farm per State across Our Nation.
And yet we are here today, actually considering reducing those
numbers further, and driving our debt deeper, to save the most
fortunate among us from that small remainder of an estate tax.
[[Page S8742]]
I believe that with the changes in current law we have accomplished
some appropriate reform. I believe that family businesses and family
farms should not be broken up to pay taxes. With the booming economy of
the 1990s, many more Americans joined the ranks of those who could face
estate taxes. Raising the exemption level and lowering the rate made
sense.
Under current law, in my State of Delaware, fewer than 50 families
will face any estate tax in 2009. Those are reforms that protect all
but a few from the estate tax. It protects family businesses and family
farms.
But I opposed complete repeal of the estate tax, and I oppose this
legislation that will cost us $750B, three quarters of the cost of full
repeal.
I oppose it, not because those who would benefit aren't good
Americans. I am sure they are. Because they are good Americans, I think
most would agree that given the world we live in today, facing a global
threat to our security, with gaps in our homeland security, with clear
domestic needs unmet, with our Federal finances already in the red--in
the face of those facts, full repeal is a luxury that we cannot afford.
We could provide our middle class with some tax relief, by extending
protection from the marriage penalty for $46 billion. We could extend
the child tax credit for $183 billion. We could extend the college
tuition deduction for $19 billion. Instead, the top priority of the
leadership in this Congress is a handout to the most fortunate, paid
for by three-quarters of a trillion dollars in debt heaped on our kids.
To add insult to this injury, the first pay raise for minimum wage
workers in 10 years is now hostage to this estate tax cut. Under
current law, you can be paid a wage that keeps you below the poverty
line even if you are working full time.
Over the past 24 years, the most fortunate Americans, in the top 1
percent, saw their incomes more than double--from an average of
$306,000 to over $700,000. During that same period, the incomes of
average Americans grew just 15 percent.
But the poorest fifth of our citizens saw their already inadequate
incomes grow just $600--over 24 years.
We are moving apart, not coming together, as a nation.
The minimum wage has not increased since 1996--and all of that
increase has been wiped out by the cost of living. The minimum wage
today, at $5.15 an hour, is even worth less in today's dollars than the
$4.25 rate it replaced.
Today, the minimum wage is worth only a third of the average hourly
wage of American workers, the lowest level in more than half a century.
The bottom rung of the ladder of opportunity is broken. It is time to
fix it.
That means a pay raise for over 7 million workers, in three stages,
over the next 3 years, to $7.25 an hour. That will lift the floor under
everybody's wages.
But now we are told that to get those folks on minimum wage a raise,
we have to go three-quarters of a trillion dollars into debt to China,
Japan, and other countries so that the sons and daughters of the 7,000
most fortunate families among us will be spared the estate tax.
Everyone else's sons and daughters will get that bill. Our country,
already the world's biggest debtor nation, already borrowing 65 percent
of all the money borrowed by countries around the world, already
spending the retirement savings that should be going into Social
Security, our country will be weaker financially because of it.
The American people are tired of seeing this kind of ``gotcha''
politics while our country is at war, while we face serious challenges
to our economic competitiveness, our health, our children's future.
Instead of a long overdue adjustment in the minimum wage, we get
political theater.
And finally, instead of extending important tax credits to promote
research and development, to clean up brownfields--even to give our
fighting forces tax credits for combat pay--we are given this take-it-
or-leave-it deal that makes estate tax cuts the top priority.
Those are not the priorities of the American people, and this Senate
should reject them.
We can pass a minimum wage increase to reward work at the bottom of
our economic ladder. We can extend the tax breaks that meet real needs
and that serve genuine public policy needs. We can do that, and we can
leave in place substantial reforms to the estate tax that have already
taken place.
First, we must say no to this transparent gimmick. Then we can do
what we should have done in the first place.
Mr. FRIST. Mr. President, has time been used on our side?
The PRESIDING OFFICER. There is 7 minutes remaining.
Mr. FRIST. Mr. President, I yield 3 minutes to the Senator from
Pennsylvania.
The PRESIDING OFFICER. The Senator from Pennsylvania is recognized
for 3 minutes.
Mr. SANTORUM. Mr. President, thank you. I thank the leader for
yielding.
This body is criticized a lot because we stand here and yell at each
other and don't get a lot done. We block and we blame, we obstruct, we
don't do the people's business.
The bill that we are about to vote on, 20 years ago, 30 years ago,
would have been hailed by all as a compromise out of the great
compromises that we have seen in the Senate over the centuries, truly a
compromise.
The No. 1 highest priority of the Senate Democrats, included in this
bill--their highest priority. We have voted on minimum wage more in
this Chamber than probably any other issue. The No. 1 priority in this
bill, their highest priority with respect to taxes, the R&D tax credit,
the extenders provision, and a variety of different provisions, tax
provisions, that were key provisions for many Senate Democrats,
included in this bill.
In addition to that, we have the abandoned mine lands bill that
Senator Rockefeller and I have worked on for months and months. This is
the only opportunity for the abandoned mine lands issue to be voted on
in the Senate. There may be attempts to throw this in and attach it to
other bills and all sorts of pounding the chest of how we are not
letting it happen.
This is a compromise. This is giving things that I can tell you many
on this side of the aisle don't want to give--whether it is minimum
wage, whether it is AMT, whether it is many of the provisions in this
bill, there are a lot of folks on this side of the aisle who do not
like any of this, and, in fact, have never voted for any of these
things.
In exchange for that, what most of the Members on this side of the
aisle would like to see done is to do something about the onerous death
tax which is scheduled to expire in 2010, and then revive itself from
the dead the next year--horrible tax policy.
But that is where we are. We are trying to fix this. We are trying to
get the priorities of both sides together in a bill to move this
country forward in a way that both sides can walk away and say: We
didn't get everything we wanted, but we made progress; I got something
that was really important to me.
Both sides can say that. Both sides can say: I didn't get everything
I wanted or I have to vote for something I don't like in this bill;
This isn't exactly the way I would do it. This problem is bigger than
all the other good things.
You know what? One thing I have always learned in my time in
government is you can always find a reason to vote no. You can always
find a reason to vote no. It takes a bigger step to compromise, to meet
someone halfway down that middle aisle, to compromise and get something
that is important for both sides. This bill does that.
Mr. FRIST. Mr. President, I yield 2 minutes to the Senator from
Texas.
The PRESIDING OFFICER. The Senator from Texas is recognized.
Mrs. HUTCHISON. Mr. President, I was listening to the debate, and I
heard the Democratic leader call this a ``do-nothing Congress.'' He
said that several times. I have heard it before. Yet here we have a
bill that will go directly to the President. This is a bill that brings
together pieces of legislation that have been worked on for years in
this body, a chance to score a huge victory for all sides, that gives a
minimum wage increase of over $2 that we have been trying to do, along
with tax cuts for small businesses so that it is a balance for years in
this Congress. We have been trying to permanently ease the burden of
the death tax ever since I got to this Senate.
[[Page S8743]]
It is the small businesses; it is not Bill Gates, it is not Warren
Buffett who is worried about the death tax. It is the farmer who is
going to have to sell his farm when he dies or his children who will
because his children can't pay the taxes because the farm is more
valuable than they can earn and produce to pay the taxes. It is the
small business that has been built by a family. It is the restaurant
owner that is going to have to sell the business that we are fixing
tonight.
This is a bill that would take away the ability to call this a ``do-
nothing Congress.''
Why is it that almost every Republican is going to vote for it and
almost every Democrat is going to vote against it?
I think this is an excuse to make this a ``do-nothing Congress'' and
we are turning our backs on the middle class and the poor people of
this country who depend on the minimum wage and death tax relief.
Mr. FRIST. Mr. President, I yield 1 minute to the distinguished
Senator from Arizona.
The PRESIDING OFFICER. The Senator from Arizona is recognized for 1
minute.
Mr. KYL. Mr. President, the Senator from Washington had printed in
the Record a letter from an official in the State of Washington. In
response and in refutation of the point of that letter, I will read
from a letter from the Assistant Secretary of Employment Standards for
the U.S. Department of Labor, Victoria Lipnick.
Mr. President, this letter is dated August 2. It says, among other
things:
Were this passed into law, the Wage and Hour Division of
the Department of Labor would read section 402 as protecting
the current minimum wages of the tipped employees in the
seven states that now exclude tipped employees' tips from
being considered as wages. To do otherwise would be
inconsistent with what we understand to be the intent of the
Congress and Fair Labor Standards Act which the WHD enforces.
The bottom line of this legislation, as has been said, is it will
increase the standards of living and decrease the cost of dying.
I urge my colleagues to support moving forward with it.
Mr. DOMENICI. Mr. President, I rise today in support of the Estate
Tax and Extension of Tax Relief Act of 2006 (H.R. 5970) more commonly
known as the Family Prosperity Act.
I believe that the Family Prosperity Act is a good compromise because
it raises the inheritance tax exemption to $10 million per couple,
increases the minimum wage by $2.10, and extends some personal and
business tax cuts. I support this legislation because it represents a
fair and reasonable compromise on all three of these important issues.
For some time now, the Senate has debated the death tax, which is the
most confiscatory tax of all. It has been a battle to repeal or modify
this tax. In my opinion this tax is in need of modification; however, a
full repeal of the death tax has been unsuccessful. Congress must act
before the current repeal sunsets and the death tax is reinstated in
2011. Inaction on our part will lead to taxation of estates over $1
million at a rate 55 percent. Therefore, we are now attempting to seek
agreement on this compromise measure that will benefit Americans. After
careful consideration I have concluded that this bill represents a fair
and reasonable compromise. Furthermore, passage of this bill will bring
relief that is long overdue.
H.R. 5970 is a permanent reduction of the death tax that will exempt
$5 million per individual and $10 million per couple. Estates under $25
million would have a maximum tax equal to the capital gain rate of 15
percent. Estates over $25 million would be taxed at 30 percent. The
exemptions and $25 million threshold are indexed for inflation and will
be fully phased in by January 1, 2015.
This tax relief is substantial to States, like my home State of New
Mexico that are filled with small business owners, family farms, and
ranches. The assets accumulated by these hard-working people should not
be taxed a second time nor at a rate that is too high. I believe that
by enacting this relief from the death tax, we will be fostering
economic growth, business investment, and entrepreneurship. Moreover,
this bill will decrease the number of estates that are liquidated in
order to pay taxes and will ultimately decrease the number of estates
that are required to file a tax return.
Some have argued that this legislation is not a compromise and that
it will preserve wealthy estates. I firmly believe that this argument
is unfounded. This bill will continue to tax estates that hold
considerable wealth while at the same time exempting small and medium
sized estates that are overly burdened, and often times extinguished,
by this tax.
I would now like to turn our attention to the minimum wage provisions
contained in the Family Prosperity Act. It has been almost 10 years
since Congress last voted to raise the minimum wage. In the meantime,
our cost-of-living has increased annually and working families have
struggled to meet their most basic needs.
The pending legislation before the Senate will increase the minimum
wage by $2.10 an hour--phased in over 3 years. I have said many times
before that I would support an increase in the minimum wage if it was
crafted properly. I believe that this bill is crafted properly because
it raises the minimum wage while extending some personal and business
tax cuts and reduces the overreaching death tax.
The current Federal minimum wage just isn't sufficient. Now is the
time to raise the minimum wage. It's time to give low-wage workers a
raise.
There was an editorial published recently in my hometown newspaper,
the Albuquerque Journal. The editorial was entitled ``Raise the Minimum
Wage: Reduce the Death Tax.'' The editorial hit on some very important
points. The focus was that we have tried to address these issues
before--and we have failed. It stressed that we need compromise in
order to get things done in this Congress.
Mr. President, I will ask that a copy of this Albuquerque Journal
editorial be printed in the Record.
This bill is a good compromise. We have before us a chance to work
together to accomplish something for the American people. We should
embrace this opportunity and work together.
The Family Protection Act contains extensions of several important
tax cuts that are currently set to expire. The research and development
credit is of significant importance. H.R. 5970 will extend the research
and development credit through 2007.
Advanced technologies drive a significant part of our Nation's
economic strength. Our economy and our standard of living depend on a
constant influx of new technologies, processes, and products from our
industries. Former Federal Reserve Chairman Greenspan frequently
reinforced the critical dependence between advanced technology and our
economic strength.
Many countries provide labor at lower costs than the United States.
Thus, as any new product matures, competitors using overseas labor
frequently find ways to undercut our production costs. We maintain our
economic strength only by constantly improving our products through
innovation. Maintaining and improving our national ability to innovate
is critically important to the Nation.
With this extension, we will significantly strengthen incentives for
private companies to undertake research that leads to new processes,
new services, and new products. The result will be stronger companies
that are better positioned for global competition. Those stronger
companies will hire more people at higher salaries with real benefits
to our national economy and workforce.
Another important tax credit that should be extended is the deduction
for higher education expenses. Higher education expenses are on the
minds of many families. Saving to invest in education is important to
the future of all young adults and to our society as a whole. We must
ensure our Nation's future by helping educate America's young adults.
That is why it is important to offer tax breaks for qualified higher
education tuition and expenses. The Family Protection Act allows
taxpayers to deduct $4,000 in qualified higher education tuition and
expenses through 2007.
The last credit that I would like to comment on is the welfare-to-
work credit. This bill extends the welfare-to-work credit through 2007.
Business plays an important role in transitioning people receiving
welfare
[[Page S8744]]
into the workforce, and providing incentives for employers to hire
welfare recipients strengthens our economy. This is an important
provision in the bill and provides one more reason for me to support
passage of this compromise.
I support this three-part compromise package because it represents a
fair and reasonable compromise on all of these important issues.
Mr. President, I ask unanimous consent that the article to which I
referred be printed in the Record.
There being no objection, the article was ordered to be printed in
the Record, as follows:
[From the Albuquerque Journal Editorial, Aug. 1, 2006]
Raise Minimum Wage; Reduce Death Tax
Santa Fe did it in 2003. Albuquerque did it in April.
Sandia Pueblo did it in May. In fact, 17 states and the
District of Columbia have done it.
Maybe before Senators go on vacation this week, they can
get the United States to do it, too: Raise the minimum wage.
The federal minimum wage has been $5.15 an hour for almost
a decade. In June the Senate killed the ninth attempt in as
many years to increase what those on the lowest tier of the
pay scale make. In the interim, municipalities have had to
step in, creating a patchwork pay scale that follows
geography instead of skill set. If a minimum wage makes
sense, it's better done from Washington.
On Friday night the House passed a bill that would increase
the minimum wage by $2.10 phased in over 3 years, extend some
business tax cuts, create others, secure pensions and raise
the inheritance-tax exemption to $5 million.
Representative Tom Udall, D-N.M., says he would have
preferred a vote solely on the minimum wage--which apparently
means he would have preferred a 10th defeat in as many years
to a compromise.
The Republican majority can accept the minimum wage
increase if the bill also includes something for one of their
constituencies--in this case, excluding more wealth from the
estate tax, which many Democrats oppose. Under current law,
taxes would revert to 55 percent on estates worth more than
$1 million after 2011. That's not soaking the aristocracy,
but forcing heirs to liquidate a family-built business or a
farm to pay the taxman. Not to mention these family assets
have already been taxed.
Critics say Republicans want political cover come the
November elections--after all, they didn't come out against
their 2 percent raise last month.
But to the single mother making $10,700 a year busing
tables, the only important cover is covering her family's
bills, and $15,000 a year goes a lot further toward that end.
Senators have their 10th chance this week to get the United
States in line with Santa Fe, Albuquerque, Sandia Pueblo, 17
states and the District of Columbia. They should take it.
Mr. ENZI. Mr. President, I rise today in strong support of H.R. 5970,
the Estate Tax and Extension of Tax Relief Act of 2006. Specifically, I
strongly support inclusion of the Surface Mining Control and
Reclamation Act Amendments of 2006 in this piece of legislation. This
legislation is very important to my home State and to coal-producing
States throughout our Nation.
I have been working to fix the Abandoned Mine Land Trust Fund since I
was first elected to the Senate in 1996. We have legislation before the
Senate to make that happen, and I applaud my colleagues from
Pennsylvania and West Virginia for their hard work on this proposal.
Senators Santorum, Rockefeller, Specter, and Byrd have helped produce a
solid piece of legislation, and I strongly support moving this forward.
For years, reauthorizing the Abandoned Mine Land--AML--Trust Fund has
been an issue that pitted the East versus the West. Consensus was never
reached on the issue, and the AML Trust Fund continued to be a broken
system. Members from the East argued that we needed to send more money
to do reclamation, while members from the West argued that we needed to
take care of the Federal Government's promise to the States. That
promise was made in 1977 with passage of the Surface Mining Control and
Reclamation Act, SMCRA.
When SMCRA was passed in 1977, a tax was levied on each ton of coal
produced. The purpose of that tax was to reclaim coal mines that had
been abandoned before laws existed that required reclamation. Half of
that tax was promised to the State where the coal was mined. That money
is known as the State share. The other half went to the Federal
Government to administer the reclamation program and to send additional
funding to the States with the most abandoned coal mines.
It was a simple enough concept. Half of the money was to be sent to
the State share, and the other half administers the AML program and
goes to States with the largest reclamation needs. Unfortunately, like
many things in Washington, while the concept was good, the
implementation has been disastrous and the program has not worked as it
was intended. For years, States have been shortchanged and reclamation
work has not been done. Today, the Federal Government owes States more
than $1.2 billion. At the same time, more than $3 billion in
reclamation remains unfinished.
When I was named the chairman of the conference committee whose job
it was to find a compromise between the House and Senate on pension
legislation, I was approached by Senator Santorum who had a proposal.
He brought with him a coalition made up of coal companies, the United
Mine Workers of America, UMWA, environmental groups and other
businesses. Together, they expressed an interest in including an AML
Trust Fund reauthorization in the pension conference report.
Where I come from, when something does not work, we work to fix it,
and so the idea of fixing the AML program on the pension conference was
intriguing. For years, I have worked with the other members of the
Wyoming delegation to reauthorize this program, and as chairman of the
conference committee, I was in a unique position to make a difference.
After listening to the proposal, I laid out a set of principles that
were necessary to gain my support for such a move.
First, I wanted to see the return of the money owed to the States,
including the $550 million owed to my State. Because Wyoming is a
certified State, I wanted to see that money come from the Federal
Government with no strings attached. The legislation we have before us
today accomplishes that goal by guaranteeing that Wyoming will receive
the money we are owed from the Federal Government in 7 years.
Second, I wanted a guarantee that future monies would be directed to
States like Wyoming where significant amounts of coal are produced.
Third, it was important that more money be directed toward
reclamation in States where the reclamation work is needed. Those goals
are accomplished with the legislation that is included in this bill.
Finally, I wanted to see a reduction on the tax charged to Wyoming's
coal companies. Some of the companies in my State do not have the
problems associated with abandoned coal mines, nor do they have the
orphan miner liability that is held by some companies. Those companies
agreed not to fight an extension of the tax if it was reduced, and this
legislation includes a slight reduction in the fee.
The priorities of other members are also included in this bill,
including provisions that shore up health care for orphan miners who
fall into the Combined Benefits Fund. Those priorities include the
addition of health care coverage for members who fall into the 1992
fund and the 1993 fund. Although the shoring up of those three funds
was not a priority for me, this represents compromise legislation.
The compromise brought all of the major players on board. The coal
companies strongly support this bill. The United Mine Workers of
America, UMWA, strongly support this bill. Other businesses who had
interests in the AML fund strongly support this bill. With all these
groups on board, we set out to gain support for this bill.
Senators Santorum and Rockefeller worked hard to bring members from
both sides of the aisle on board, and I commend them for their efforts.
At the end of the day, we had seven committee chairmen who supported
this bill. The chairman and ranking member of the Energy Committee, who
have jurisdiction over a portion of the bill, signed a letter to the
majority leader asking that it be included in the pension conference.
The chairman and ranking member of the Finance Committee, who have
jurisdiction over the rest of the bill, expressed support for moving
this forward.
As we gained support, we also learned of opposition from members who
objected to the cost of the legislation.
[[Page S8745]]
They claimed that the bill was too expensive and that the health care
coverage for the orphan and widow miners was too good. As a member of
the Senate Budget Committee, I want to spend taxpayer dollars
appropriately. I want programs to work the way they are intended to
work, and this program has not done so.
For my colleagues who have concerns about the cost of the
legislation, it is important to remember that a $1.8 billion Federal
trust sits in the Federal Treasury. It is important to remember that,
although the fee is reduced slightly, we will continue to collect
significant income from the fee. It is also important to remember that
the Federal Treasury will collect significant revenues from coal
production.
For years, we have been using Federal dollars in a way that they were
not intended to be used. We have not made progress on the reclamation
side, nor have we kept our promise to the States. This legislation
corrects that error. It sends significant amounts of money to do
reclamation, and it returns the money that was promised to the States.
As for the health care aspect of the bill, it is important to know
that the Federal Government already provides funding for some health
care. It is provided for with interest from Wyoming and other States'
money. The Senators who represent the families who receive this health
care continue to make sure the families receive it. Since miners'
health care continues to be funded, we needed to find a way to fulfill
the promise to the States. This legislation was such a fix.
As more members were brought on board, I worked with my colleagues on
the pension conference to include this provision in the final
conference report. Much progress was made, and at the end of the day, I
included the AML bill that is a part of H.R. 5970 in my chairman's mark
for the pension conference. This AML fix fit nicely in a section
containing important tax credits, such as a State sales tax deduction
from Federal income tax for Wyoming and other States with no income
tax.
A last-minute strategy decision by some House members was made to
separate the AML bill and the tax credits from the pension portion of
the conference report. The House put the AML and the tax credits in a
bill that also included the death tax forgiveness and a minimum wage
increase. The second bill included many of the pension provisions of
the pension conference report. The House then passed the pension bill
and the tax credit bill and then adjourned on July 29, 2006, for the
August home work period. That is where we stand.
I also take this opportunity to voice my support for the estate tax
relief contained in this legislation. While I support a full and
permanent repeal of this burdensome and unfair tax, the language
contained in H.R. 5970 is a big step forward. Under this legislation,
the estate and gift tax exemption will be increased over time to $5
million per person. The elimination of this unjust tax will allow many
small, family-owned businesses throughout Wyoming and the Nation to
keep their businesses open.
As I have said time and time again, the death tax is fundamentally
unfair because it constitutes another layer of taxation. After years of
paying State and Federal income taxes and other property taxes while
trying to operate a successful business, the family must pay again at
the time of death. The land subject to the death tax is the exact same
land that the owner has been paying annual property taxes on. Double
taxation is not only unfair on a philosophical level, it causes severe
financial harm to the small businesses that are the driving force
behind our economy. Our tax laws should encourage investment and growth
and not stifle small businesses.
In addition to affecting many small businesses, the death tax forces
landowners to sell their property to afford paying this tax and avoid
passing on the costs to the next generation. Throughout Wyoming, I hear
stories of families who are struggling to decide whether to sell part
of their farm or ranch or risk leaving their children and grandchildren
with this overly burdensome tax. Families should not have to make this
impossible choice. In Wyoming, we work hard, in pursuit of the American
dream, to create a better life for our children and grandchildren. Yet
the death tax punishes this dream and the families who must pick up the
pieces after losing a loved one.
There is another hidden cost to this double tax that many people do
not consider. The death tax also forces families to spend thousands of
dollars on estate planning. By requiring individuals and families to
use vital financial resources on estate planning, money is being taken
away from the family business, farm, or ranch. Permanently eliminating
this tax will move precious financial resources to the business and
employees themselves instead of to extensive estate planning costs.
Finally, I would like to briefly address one additional provision in
this legislation--the State and local sales tax deduction. H.R. 5970
includes an extension of the State and local sales tax deduction for 2
years. I applaud the extension of this deduction. The ability to deduct
State sales tax is an issue of fairness and parity. Under this
legislation, taxpayers have the option to deduct their State and local
sales tax or their State income tax. Federal taxpayers who reside in a
State without an income tax should not be punished and forced to pay
additional Federal taxes. Under this extension, taxpayers can choose
whether to deduct their State and local sales or income tax.
I intend to vote in favor of the overall package. I strongly support
the inclusion of the AML legislation. I am also strongly supportive of
the tax extenders and the death tax relief. I hope that my colleagues
will see the importance of this legislation and will join me in
supporting its passage.
Mr. FRIST. Mr. President, how much time remains?
The PRESIDING OFFICER. Thirty seconds.
Mr. FRIST. Mr. President, I yield 1 minute using leader time to my
distinguished colleague from Kentucky.
The PRESIDING OFFICER. The Senator from Kentucky is recognized.
Mr. McCONNELL. Mr. President, how can we have bipartisanship in the
Congress if Democrats won't take yes for an answer?
Of course, I am speaking about the bill before us--H.R. 5970, the
Estate Tax and Extension of Tax Relief Act of 2006.
This legislation package isn't everything the Republicans wanted, and
it is not everything the Democrats wanted. But both parties, and both
Houses of Congress, now have an opportunity to vote on compromise
legislation that accomplishes the goals we all aimed for.
We will substantially reduce the estate tax, or as I prefer to call
it, the death tax. No American family should be forced to visit the
undertaker and the tax collector on the same day.
Nothing could place more stress on a family than the loss of a loved
one. Yet at such a difficult time, too many families in America today
must make decisions about selling a business or a farm that has been in
the family for generations in order to pay the death tax. That is
wrong, and with this legislation, we will end that problem for many
Americans.
We will also extend tax relief for many, to help encourage economic
growth.
At the same time, we will increase the federally mandated minimum
wage, from its current rate of $5.15 an hour to $7.25 in 2009. My
friends on the other side of the aisle have continually said that
raising the minimum wage is their top legislative priority.
Well, now is the time to vote for their top priority. Yet the
Democratic leadership is threatening to kill this bill.
What part of ``yes'' do my friends on the other side of the aisle not
understand? What part of ``bipartisanship'' do they not want?
We want to meet them halfway on this compromise legislation. We have
taken their legislation, and some of our legislation, and also a host
of tax provisions that we all agree on. But apparently it is not
enough.
The Democrats cannot call this a do-nothing Congress on the one hand,
and block every bill they can and try to blame the majority on the
other.
We have a choice. We can work together and pass legislation that will
benefit millions of Americans, or we can devolve into obstruction, and
get nothing. I think what the American
[[Page S8746]]
people deserve is positive action. That means passing this bipartisan
compromise bill.
We were all elected to get something done on behalf of our
constituents, and this legislation will mean real, tangible results for
millions of Americans. As always, I stand ready to work with my
Democratic friends to pass much-needed tax relief, and add to the long
list of accomplishments of the 109th Congress.
Unfortunately, it appears the Democrat leadership would prefer to
have a political issue rather than an accomplishment.
Mr. President, what we have heard tonight on the other side of the
aisle is block and blame.
We have before us is a provision in three parts, each of which is
supported by a bipartisan majority.
Let me say that again.
Each of the three parts of this bill are supported by a bipartisan
majority of the Senate.
So what can possibly be wrong with passing the three bills together
since they are each supported by a bipartisan majority of the Senate?
What is going on here? It is block and blame. They want to say this
is a ``do-nothing Congress.''
If there is anything this Congress has not been able to accomplish,
you can point the finger at the Democratic side of the aisle. Their
strategy is block and blame.
I yield the floor.
Mr. FRIST. Mr. President, in closing, I will be very brief.
In a few moments, we will be voting on the motion to proceed to this
very important bill called the Family Prosperity Act. It is called that
very specifically for the reasons we have outlined.
There are three very important components: The extension of tax
relief--we spoke about it on the floor, key provisions such as the
State and local tax deduction affecting the many States, in my State
alone, 670,000 Tennessee families; college tuition deduction affecting
millions of families; research and development tax credit which
stimulates growth, innovation, creativity, and jobs; teachers'
classroom expenses deduction, affecting 55,000 teachers.
Secondly, the permanent solution to the death tax challenge that we
have today is a compromise. It is not only a compromise that prevents
the death rate from escalating to 55 percent and dropping to $1 million
in 2011, it is a $5 million exemption per spouse indexed for inflation,
and a 15-percent tax rate from $5 million to $25 million.
Thirdly, a minimum wage increase, 40 percent over the next 3 years--
40 percent.
In summary, an ``aye'' vote is a vote for that permanent death tax
relief. An ``aye'' vote is for that extension of tax relief. And an
``aye'' vote is for that 40 percent minimum wage increase.
We have a lot of challenges before us. We have addressed many others
in the last 4 weeks. This gives us the opportunity to address an issue
that will affect the typical American out their working, their family,
that farmer, that small business owner.
I encourage my colleagues to vote aye.
I ask unanimous notwithstanding rule XXII that the mandatory quorum
be waived.
The PRESIDING OFFICER. Without objection, it is so ordered.
Cloture Motion
The PRESIDING OFFICER. Under the previous order, the clerk will
report the motion to invoke cloture on the motion to proceed to H.R.
5970 the Estate Tax and Extension of Tax Relief Act of 2006.
The assistant legislative clerk read as follows:
Cloture Motion
We the undersigned Senators, in accordance with the provisions of
rule XXII of the Standing Rules of the Senate, do hereby move to bring
to a close debate on the motion to proceed to H.R. 5970: a bill to
amend the Internal Revenue Code of 1986 to increase the unified credit
against the estate tax to an exclusion equivalent of $5,000,000, to
repeal the sunset provision for the estate and generation-skipping
taxes, and to extend expiring provisions, and for other purposes.
Bill Frist, Mike Crapo, Lamar Alexander, Richard C.
Shelby, Sam Brownback, Saxby Chambliss, Chuck Hagel,
Tom Coburn, Richard Burr, Orrin Hatch, Thad Cochran,
John Ensign, David Vitter, Pat Roberts, Craig Thomas,
Jeff Sessions, Mel Martinez.
The PRESIDING OFFICER. By unanimous consent, the mandatory quorum
call has been waived.
The question is, Is it the sense of the Senate that debate on the
motion to proceed to H.R. 5970, a bill to amend the Internal Revenue
Code of 1986 to increase the unified credit against the estate tax to
an exclusion equivalent of $5 million, to repeal the sunset provision
for the estate and generation-skipping taxes, and to extend expiring
provisions, and for other purposes, shall be brought to a close?
The yeas and nays are mandatory under the rule.
The clerk will call the roll.
The assistant legislative clerk called the roll.
Mr. DURBIN. I announce that the Senator from Montana (Mr. Baucus) and
the Senator from Connecticut (Mr. Lieberman) are necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The yeas and nays resulted--56 yeas, nays 42, as follows:
[Rollcall Vote No. 229 Leg.]
YEAS--56
Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Burr
Byrd
Chambliss
Coburn
Cochran
Coleman
Collins
Cornyn
Craig
Crapo
DeMint
DeWine
Dole
Domenici
Ensign
Enzi
Graham
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Isakson
Kyl
Lincoln
Lott
Lugar
Martinez
McCain
McConnell
Murkowski
Nelson (FL)
Nelson (NE)
Roberts
Santorum
Sessions
Shelby
Smith
Snowe
Specter
Stevens
Sununu
Talent
Thomas
Thune
Vitter
Warner
NAYS--42
Akaka
Bayh
Biden
Bingaman
Boxer
Cantwell
Carper
Chafee
Clinton
Conrad
Dayton
Dodd
Dorgan
Durbin
Feingold
Feinstein
Frist
Harkin
Inouye
Jeffords
Johnson
Kennedy
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Menendez
Mikulski
Murray
Obama
Pryor
Reed
Reid
Rockefeller
Salazar
Sarbanes
Schumer
Stabenow
Voinovich
Wyden
NOT VOTING--2
Baucus
Lieberman
The PRESIDING OFFICER. On this vote, the yeas are 56, the nays are
42. Three-fifths of the Senators duly chosen and sworn not having voted
in the affirmative, the motion is rejected.
The majority leader is recognized.
Mr. FRIST. Mr. President, I now enter a motion to reconsider the vote
by which cloture was not invoked.
The PRESIDING OFFICER. The motion is entered.
Mr. FRIST. Mr. President, the real vote would have been 57 to 41. I
switched my vote from ``aye'' to ``no,'' thus the reported vote is 56
to 42.
I want to clarify, very briefly, where we are now. For purely
procedural reasons, as leader, I switched my vote to a ``no'' vote to
preserve all of my procedural options. As everyone knows, I strongly
support cloture and moving to proceed to the three important issues in
the Family Prosperity Act. I initially voted ``yes'' on cloture, but by
switching to a ``no'' vote, I preserve my right, as leader, to revisit
this issue in the future as a package.
The Senate just had a majority vote to move forward to this bill
which reforms the onerous death tax, raises the minimum wage for
millions of Americans, and provides a number of important tax relief
extenders that will expire. Had the Senate invoked cloture, I am
confident we could have finished this measure this weekend and
presented it to the President in the next couple of days to become the
law of the land.
With my switched vote, I preserve the procedural option to bring the
bill back as a package. I hope the Democratic Senators will rethink
long and hard over the weeks to come before we return for business in
September.
Mr. President, finally, just for the record, a number of comments
were made just prior to the vote about the tip wage issue. As my
colleagues know, I have made it clear to them that is an issue that we
would be able to address once on the bill. But we have now been
prevented from getting on the bill.
[[Page S8747]]
I am confounded. There is no other way to put it.
My colleagues on the other side of the aisle come to this floor, time
and again, raving about a ``do nothing'' Congress.
Well, today, just a few minutes ago, we had yet another opportunity
to do something--as we have already many times this Congress.
We had the chance to bring three very important issues to the floor
for debate: permanent death tax relief, extension of expiring tax
provisions, and a minimum wage Increase.
These are issues that matter in the day-to-day lives of our
constituents--issues that actually mean something to hard-working
Americans.
And yet some of my colleagues decided these issues aren't important
enough to debate here on the Senate floor.
This package--it's about securing America's prosperity.
It's about easing the tax burden facing America's families.
It's about helping hard-working Americans tackle an increasing cost
of living head on.
And it's about fostering innovation and reinvestment in our homegrown
small businesses and farms.
Quite simply, it's vital to the economic security of everyday
Americans.
These are challenging issues, and they must be addressed here on the
Senate floor.
And as I have said before, these issues must be addressed as a
package: permanent death tax relief, tax policy extensions, and a 40-
percent increase in the minimum wage.
All three together. All or nothing.
Not bringing this package--the Family Prosperity Act--to the floor is
tantamount to saying, ``We don't care about America's economic
security.''
And I am deeply ashamed that we, the U.S. Senate, would ever dare
send such a message to the American people.
The PRESIDING OFFICER. The Democratic leader.
Mr. REID. Mr. President, everyone will be relieved to know I don't
have anything to say.
____________________