[Congressional Record Volume 156, Number 14 (Monday, February 1, 2010)]
[Senate]
[Pages S394-S396]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CASEY (for himself, Mrs. Gillibrand, Mr. Levin, and Mr. 
        Begich):
  S. 2973. A bill to amend the Internal Revenue Code of 1986 to provide 
a temporary payroll increase tax credit for certain employers; to the 
Committee on Finance.
  Mr. CASEY. Mr. President, I rise tonight to speak of what I believe 
is the central concern of the American people right now, and that is 
the issue of jobs or in many cases the lack of a job. We have seen it 
in so many ways. We have seen it in our own communities. Many people 
have seen it in their own families. These are not statistics on a 
business page. When they see an unemployment rate or the number of 
people who are out of work, it is real life for far too many American 
families. As long as the unemployment rate in America is 10 percent, 
the American people want us to focus, as we never have before, on the 
issue of job creation.
  In Pennsylvania we have now 560,000 people out of work as of the last 
month it was calculated, the month of December. That is a huge number. 
If you look at it by percentage it looks like it is lower than a lot of 
States, 8.9 percent, but it is 560,000 people in Pennsylvania, and it 
spiked upwards toward the end of the year.
  I had a chance, now just about a week ago, to sit down with 8 of 
those 560,000 people, 8 people out of work. I will not give you their 
names because that was the agreement. I wanted to spend some time 
listening, mostly, to folks who had been laid off, who lost their job 
in one way or another, through no fault of their own, victims of this 
horrific recession that so many families have lived through.
  To encapsulate what they said, it comes down to much of what we heard 
President Obama speak about the other night in the State of Union, as 
well as what he said a number of weeks ago when he met unemployed 
individuals in Allentown, PA.
  What he saw in that job center in Pennsylvania is what I saw in 
another job center in another part of the State: people who do not 
fully understand why they are in this predicament--people who had 
worked their whole lives, had great work records, never missed a day of 
work for the most part, many of them over the age of 50, many of them 
over the age of 60 and feeling a kind of economic insecurity and 
vulnerability they never had felt before, but, despite all that, they 
were not complaining. They were not pointing fingers. They were not 
complaining about the number of applications they filled out--scores of 
them, 25, 30, 50, 100--and in many cases getting either rejected or 
hearing nothing at all. That is what I heard.
  I also heard, as the President said, a real determination to keep 
fighting, to keep applying, and to keep trying to get a job. Maybe the 
thread that runs through all of them is they are grateful for the 
country they live in and they want to work. They don't want to be in 
the position they are in. Many of them feel ashamed to have to rely 
upon someone else or an institution or, in particular, a government 
program.
  One woman said to me, in the meeting I had a week ago--she was just 
sitting on my right. She had a lot of brains and talent and commitment, 
had never had to worry about being out of work before. But she told me 
she felt--and I am not quoting her directly--bad or even embarrassed 
about having to rely upon food stamps, a program that we know helps 
people get across that bridge when they are out of work, when they can 
return to work.
  These eight individuals gave me just an insight, just a glimmer of 
how difficult it is for so many families.
  I received a couple of letters recently. I will not use names because 
we do not have permission, but two individuals, one from southeastern 
Pennsylvania, and one--actually two from southeastern Pennsylvania, 
which in Pennsylvania, generally, is probably one of the most 
prosperous corners of our State.
  But even in suburban communities that seem well off and strong 
economically, we are seeing many challenges for families who have lost 
their jobs, in some cases more than one person. One woman wrote to me 
and said:

       My husband got a job at a particular company [I will not 
     identify the company] right out of high school. Left to serve 
     in the Army. Then went back and retired from there when they 
     closed.

  So like a lot of places, someone works for decades and the plant 
closes, that is where they lose their job.
  She continues:

       I got a job in a factory and worked there while starting to 
     raise two sons until they closed that company as well. We 
     both got our jobs to support our families.

  Then she talked about her sons getting the benefit of a college 
education which she and her husband did not have. But now they are at 
risk because one son is out of work and the other one is having 
challenges as well, despite having a college education.
  She concludes the letter with one question, a question which I think 
is on the minds of a lot of Americans, not a question where they are 
pointing a finger at what is happening or not happening in Washington, 
but it is a question we need to listen to and do our best to provide 
answers for.
  She says: When is the change coming?
  When is the change coming? I think it encapsulates a lot of the 
questions I have heard across Pennsylvania. People are worried about 
what a lot of us have been talking about here; it is not moving fast 
enough to help them.
  I point to another letter from an individual, again in southeastern 
Pennsylvania. This gentleman said to me that he grew up in 
Pennsylvania, had roots in Pennsylvania. He said:

       I worked hard all of my life, yet to no avail. I have been 
     unemployed since the last layoff for a year now.

  It is hard to comprehend that, being out of work for a year, in some 
cases longer than a year.
  I seriously think we should start focusing heavily on jobs in the 
United States. We are hearing that everywhere, the same sentiment. But 
like the letter I cited a minute ago from a woman in southeastern 
Pennsylvania, this man said to me toward the end of the letter: When 
will the recovery begin for those individuals, the people he described 
in his letter, in addition to talking about his own situation?
  So we can't pretend that just because we passed a recovery bill last 
year, which I voted for--I was very proud to support that. I know it 
was not the most popular vote in the world for a lot of folks around 
here, but we know the recovery bill is starting to work, in some cases 
working faster than others. There are good numbers on job creation 
across the country. Instead of losing 741,000 jobs as we did in January 
2009, we are losing in the tens of thousands now--still not good, not 
enough when the unemployment rate is 10 percent across the country, 
when 560,000 people in Pennsylvania are out of work. So we should point 
this out, that the Recovery and Reinvestment Act is beginning to work 
but it is not working fast enough. So we have to do more. We can't just 
say: Let it fully play out and let it be fully implemented and all. 
That is not good enough for the economic trauma so many families are 
facing.
  So for those who are leading lives of struggle and challenge, lives 
of anxiety and worry, and a kind of collective economic insecurity, we 
have to act. We can't just talk, we have to act. And I believe one of 
the ways we can act is by passing not just a jobs bill, which we should 
and must pass very quickly, but a jobs bill that is targeted on 
creating jobs in the fastest way possible. We do not need theories; we 
do not need some idea or some theory, untested; we do not need a bill 
that we hope will create jobs over many years. We need a bill that 
creates jobs this year, in the next 6 months to the next year, not the 
year after and 5 years later. We need a job creation bill that does 
that now.
  I hope many of my colleagues will support legislation I have 
introduced, the Small Business Job Creation Tax Credit Act of 2010. I 
have introduced it today. I thank Senators Gillibrand, Levin, and 
Begich for cosponsoring this important legislation.
  I mentioned the job loss in Pennsylvania, 560,000 people out of work 
through no fault of their own. That number across the country, since 
the

[[Page S395]]

beginning of the recession--if you add up the jobs lost, it is over 7 
million jobs since the beginning of the recession.
  I just saw a story yesterday in my hometown paper in Scranton, the 
Times Tribune, a front-page story talking about the manufacturing job 
loss in just one region, not even a corner, just a region of 
Pennsylvania, 3 counties out of 67 counties. It was reported that in 
2005--not that long ago--there were 35,150 manufacturing jobs in that 
region, over 35,000 jobs in 2005, and it is down below 30,000 now, 
29,400 as of the latest number, meaning that a little more than 5,000 
jobs have been lost in that period, in just a couple of years in 
northeastern Pennsylvania, and if you stretch it over 5 years, it is 
more than 7,500 manufacturing jobs. We know that number nationally is 2 
million--2 million manufacturing jobs lost since the recession began in 
December 2007.
  I mentioned the 10-percent unemployment rate, and I also mentioned 
that the Recovery Act is having an impact. We are happy about that, and 
we should mention and affirm that, but it is not moving fast enough. We 
have to do more.
  This job creation tax credit--and many others have different versions 
of it, but the version I have been working on is actually very simple. 
We set the line of division between a large and small business at 100. 
So if you are under 100, you are considered a small business in this 
bill; over 100, a large business. If you are under 100 and you increase 
your payroll--when you compare one quarter of a particular year to the 
corresponding quarter from the year before, if you increase your 
payroll in that quarter, you get a tax credit of 20 percent. If you are 
above 100 employees and you add to your payroll in a particular 
quarter, you can get a 15-percent tax credit. It makes sense because it 
is targeted, it is focused on the problem, and it is going to be 
effective. We know from prior history--it is not theory; we have 
already tested this in recent American history--that it is a job 
creator. It creates jobs in big numbers fast. That is what we need.
  We know the focus of this, of course, just by definition, becomes 
small business. We know that in America, most of the job creation in 
any period but especially in recent history has been the creation of 
jobs in small businesses. In Pennsylvania, small businesses with less 
than 100 employees--that fit into the definition of our bill--accounted 
for 91.6 percent of job growth between 2003 and 2006. Almost 92 percent 
of the job growth in Pennsylvania for that time period was small 
business.
  This tax credit legislation would provide employers with a 
nonrefundable quarterly payroll tax credit based upon the increase in 
the employers' wages paid. It would be 1 year. We want to emphasize 
that we are focused on the short term, immediate direct benefit for the 
economy and to individual employers. The credit would only apply to an 
employee's wages up to the Social Security wage base of $106,800.
  I mentioned a business of 100 or more getting a 15-percent credit and 
less than 100 getting a 20-percent tax credit. So, for example, if you 
had a firm that would be considered a small business and say they have 
a total payroll of $\1/2\ million--and we are talking about the second 
quarter of 2009--we pass the bill and we get the legislation enacted, a 
year later, you compare that $500,000 payroll to a quarter in 2010. Say 
they hired five employees. If you hired those five employees, all of 
whom are given an annual salary of $40,000, that means you have five 
employees making $10,000 in a particular quarter. The tax credit would 
apply to that increase in their payroll. So that particular company 
could get a tax credit to offset their quarterly taxes by some $10,000.
  So we wanted to make this part of the jobs bill we are going to be 
considering very quickly. I believe the bill we are going to be 
completing work on and voting on will be a bill that will focus on 
strategy to create jobs very quickly and not be a big bill that a lot 
of things get attached to that make people feel good but may not create 
jobs.
  I wanted to move to three charts very quickly. The first chart with 
regard to the small business job creation tax credit is a chart that 
depicts one of the themes here, that this particular strategy will be 
effective. This is from the Congressional Budget Office.
  As of January of this year--for those who follow us, I use the 
acronym ``CBO,'' but for those who do not, the Congressional Budget 
Office. By definition, I think by acceptance of both parties in 
Washington, the CBO is a referee. When the Congressional Budget Office, 
CBO, says this is what this particular legislation will cost, it tends 
to be accepted as a good number. So when the CBO speaks about a 
particular policy provision, it speaks with authority and I think with 
a significant degree of credibility. Here is what CBO said:

       Providing tax credits for increases in payrolls would 
     increase both output and employment.

  That is what we want. We want legislation that will be, first, 
effective. The next part is very simple, just the word ``efficient.'' 
We want to make sure we can put dollars in the hands of employers very 
quickly to create jobs in the near term.
  The same Congressional Budget Office report that I cited before for 
January of this year says that:

       This particular policy would provide tax benefits linked to 
     payroll growth; fewer budget dollars would be used to cut 
     taxes for workers who would have been employed anyway.

  So that is an indication that it can be efficient.
  Finally, related to the question of efficiency is, how will this work 
in the real world? Often, we talk about and debate and enact things 
that sometimes do not work as well as we hope they would. We want this 
to work. We do not want to have an employer say: Well, I have a tax 
credit, but I need to hire an army of lawyers to interpret and 
implement it. We want this to be a provision that is easy for 
businesses to use.
  So here is a basic form 941. Every employer has to fill this out 
quarterly. And there is a lot to go on this. I will not read every 
line, but as you can see, the form captures the number of employees who 
receive wages, the taxes and wages. The IRS would simply have to add in 
the ability to calculate the change in the payroll from one quarter of 
one tax year to one quarter of the next. So if the IRS can add a line 
or two, when this employer is filing out this form they are well 
familiar with--they have to fill it out every quarter--they can just 
add in how they have increased their payroll. They do that, and they 
will have the opportunity to benefit from the tax credit.
  Finally, let me turn to one final theme, which is cost. I expect the 
cost of this tax credit to be $30 billion. The improvement to the 
economy from this tax credit will more than offset the overall cost. An 
increase in the gross domestic product will obviously increase company 
profits, which will increase the revenue of the U.S. Government. An 
increase in revenue will also reduce the deficit.
  We have to invest in a strategy that will create jobs right now. We 
do not have time for a long ramp-up along the implementation of new 
legislation.
  Finally, an increase in jobs will assist in taking people off 
unemployment, putting people to work. We want to have the safety net in 
place of unemployment insurance and/or food stamps and COBRA for 
insurance, but we also want to create opportunities so that more and 
more people do not have to worry about having to enroll in those 
programs and can actually be going to work every day because we 
answered the questions that were in those letters about when will the 
change come, when will we have the kind of economic security that 
workers and their families have a right to expect.
  As we go through these next couple of days--I think we are down to 
days now--finishing up a provision or a set of provisions that will be 
a jobs bill, we have to be not just focused on getting the policy 
right, we have to be focused on getting this right for real people, 
people who are leading lives of struggle and anxiety and worry every 
day. Every morning they get up, they are worried about not having a 
job. Many of them are worried because they do not have access to health 
care or sometimes the protections we should have on health care--
another bit of unfinished major business we have. But, in particular, 
most Americans are faced with the prospect of darkness, of misery, and 
the pain of no job at all. For those eight individuals I met and for 
those who have been writing to me--and I am sure many people in both 
parties--we have to act, and we have to

[[Page S396]]

act now. Talk is long past. We have exhausted the time for just talk 
and discussion. We have to act and pass a jobs bill. A central part of 
a jobs bill has to be a job creation tax credit to efficiently and 
effectively and in a very focused way create jobs in the near term.
  I ask my colleagues to review and cosponsor the job creation tax 
credit legislation I have for small businesses.

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