[Congressional Record Volume 163, Number 159 (Wednesday, October 4, 2017)]
[Senate]
[Pages S6301-S6302]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                               Tax Reform

  Mr. HATCH. Madam President, last week I joined with the Secretary of 
the Treasury, the Director of the National Economic Council, our Senate 
majority leader, the Speaker of the House, and the chairman of the 
House Ways and Means Committee in releasing a unified framework for tax 
reform.
  This is a big step in the ongoing effort to overhaul our Nation's 
miserable Tax Code. I have been in the Senate awhile, and I can only 
remember a few times when the White House and the House and Senate 
leadership were in agreement on an issue as complicated as tax reform 
so the current state of affairs is pretty remarkable. Still, as we made 
clear in the framework document, this is only a step; it is not a final 
product.
  The House and the Senate tax-writing committees will be tasked with 
putting together legislation that is aimed at meeting the goals and 
principles that are outlined in the framework. Therefore, as the 
chairman of the Senate Finance Committee, my top goal at the moment is 
to produce a comprehensive tax reform bill that can get at least 14 
votes in the committee because, without that, there likely will not be 
any tax reform. Yet, before we can get to that point, we have to pass 
the fiscal year 2018 budget resolution.
  Make no mistake, the budget resolution is critical to our tax reform 
efforts. If we are going to move a tax reform vehicle in the current 
environment, we need a resolution in place with a workable 
reconciliation instruction that will allow us to produce a bill of 
sufficient size and scope to give middle-class taxpayers a pay raise, 
grow our economy, and create more American jobs.
  As we all know, the Budget Committee will begin marking up its 
resolution later today, and it will include the type of instruction we 
need in order to produce a bill that will fix our broken tax system, 
boost economic growth, and give a pay raise to middle-class Americans.
  I am grateful for the leadership of Chairman Enzi and all of our 
colleagues on the Budget Committee for their work in crafting the 
resolution, and I urge everyone who supports tax reform, whether he is 
in Congress or elsewhere, to support the budget resolution.
  Once again, that is the next big step in this process, and it is an 
absolutely essential step. Once that is done, the Finance Committee 
will be able to move forward on crafting and marking up a tax reform 
bill.
  Some have said tax reform is a do-or-die moment for the GOP. I 
wholeheartedly believe that to be true, not just because we might lose 
an election or that our poll numbers might go down, it is that 
Republicans have promised, for some time now, that we will deliver 
meaningful, comprehensive tax reform that will spur economic growth, 
increase wages and well-paying jobs, and simplify our existing system. 
We need to deliver on that promise and not just because we will suffer 
politically if we do not. We need to deliver because the cost of doing 
nothing--the cost of maintaining the status quo for the foreseeable 
future--will be too much for the American people and our economy to 
bear.
  The last major overhaul of our Tax Code was 31 years ago, and in many 
respects, our current tax system was built for the economy of 1986 and 
is ill-suited for the needs of today. In the last 31 years, we have 
seen a dramatic increase in international trade and expanded 
globalization. We have seen the fall of the Soviet Union and the 
collapse of most centrally run economies, and of course we have seen 
the development and rapid expansion of the internet, which has, in many 
respects, remade the entire world several times over.
  America no longer has a competitive Tax Code. Instead, we have a 
Byzantine system with exceptionally high rates and an array of 
overlapping and often less-than-effective deductions, exclusions, and 
credits. This is not just a parade of horribles trotted out 
by Republicans, these problems have been acknowledged by a number of 
prominent Democrats, like Presidents Clinton and Obama, not to mention 
our current Senate minority leader and the ranking member of the 
Finance Committee, Senator Wyden.

  We all know the system is not working. Still, in many respects, we 
have politics as usual around here when we talk about tax reform. While 
both parties have supported reforms in the recent past, including a 
number of reforms that are included in the framework, we are already 
hearing the same, tired arguments that come up every time Republicans 
want to talk about tax reform.
  According to the opponents of reform, our ``plan'' will cut taxes on 
the superrich. Our ``plan'' will raise taxes on the poor. Our ``plan'' 
will harm the middle class. Our ``plan'' is a giveaway to greedy 
corporations. These are some pretty odd claims given that as of right 
now, no completed ``plan'' exists. We have a framework, and we are not 
calling it that simply for PR reasons. We have some basic principles 
and targets that the leaders have agreed upon, but as the framework 
makes clear, the Finance and Ways and Means Committees have been tasked 
with filling in the details and writing legislation.
  Here are just some of the details that are not included in the 
framework:
  Income thresholds for individual tax brackets. The framework includes 
rate targets for three brackets, but the breakdown of those brackets is 
still to be determined.
  The size of the enhanced Child Tax Credit. The framework anticipates 
an increase, but it does not specify an amount.

[[Page S6302]]

  The existence and rate of the highest bracket. Our document leaves 
room for the creation of a fourth bracket at the high end, but it does 
not include any rate target.
  Safeguards to prevent abuse of the separate passthrough rates.
  These are just some of the key details that need to be filled in.
  My point is, no one can make any definitive statements or make any 
credible estimates about the fiscal impact of the plan until the 
committees do more work. Still, that has not stopped people from 
trying.
  Last week, the left-leaning Tax Policy Center released an 
unattributed ``analysis'' of the framework that appeared to confirm a 
number of blanket claims that critics have made about our ``plan.'' As 
we all know, left-leaning pundits, liberal media outlets, and many of 
our friends on the other side seem to love the TPC, apparently because 
the TPC is willing to provide estimates and analysis about tax plans 
without waiting for all of the boring details.
  We all remember well when the TPC wrote Mitt Romney's tax plan for 
him and claimed that he wanted to raise taxes on the middle class to 
finance a tax cut for the top 1 percent. Their analysis of the Romney 
plan--a plan that was not yet in existence beyond a broad set of 
principles--became the gospel for our friends on the other side, and 
their estimates were repeated time and again; never mind the fact that 
they did not have nearly enough evidence to support their assertions.
  The TPC appears to be on the same track with regard to the unified 
framework. I guess they think they can get away with it again. Maybe 
they can. I don't know. The TPC's document from last week included a 
relatively precise estimate of lost revenue that they claim would 
result from the framework. It also estimated how much of the tax 
benefit of the framework would go to the top 1 percent of earners, 
again with a fair amount of precision. How they got to these results 
is, certainly, to me, a mystery.
  There is simply no way for the TPC or anyone to deliver these kinds 
of specific estimates with the information that is provided in the 
framework. To get their estimates, they filled in blanks with numbers 
from other proposals, added a pile of exceptionally pessimistic and 
biased economic assumptions, and came up with a tax plan that, for all 
intents and purposes, is their own. Just because they say this analysis 
was performed on the unified framework and was not just a plan they 
made up themselves does not suddenly make their estimates credible.
  Still, I expect to hear a lot about the TPC's ``analysis'' in the 
coming weeks. Some will treat their estimates as fact, and I expect we 
will see them cited in a few campaign commercials before too long. 
Breaking from any notion of professional accountability, the TPC's 
``analysis'' was, according to the TPC's report, authored by the TPC's 
staff. Evidently, no one in an organization that describes itself as 
``nonpartisan'' wanted to put their name on a document that would be 
used in such a partisan manner, but let's be clear. We cannot separate 
this kind of speculative ``analysis'' from the way it is being used by 
our friends on the other side. It has become fodder for more of the 
same partisan attacks.
  In going forward, I hope the TPC and other think tanks will 
acknowledge the still undefined features of the framework, including 
the commitment to maintaining the current progressivity of the Tax 
Code, which will require adjustments in order to achieve. I think 
groups like the TPC can be helpful if they avoid the partisan 
criticisms and focus on shedding light and providing accurate 
assessments of various proposals. Everyone who has an interest in these 
issues should wait and let the tax-writing committees do their work.
  In the Finance Committee, we are going to write a committee bill. Any 
Member who is sincerely interested in working with us will get a chance 
to contribute, whether he is a Republican or Democrat. We are going to 
have a markup during which the bill will be debated and amended in the 
light of the day. Thereafter, I expect that we will have a fair and 
open amendment process on the floor. Despite some odd claims to the 
contrary, the Joint Committee on Taxation will score the bill.
  At the end of the day, people will be free to disagree with the final 
bill and to vote against it, but no one will be able to credibly claim 
that the legislation was written behind closed doors or that the 
American people did not get a chance to see what was in the bill and 
read accurate accounts of its fiscal and economic impacts.
  I want to work with anyone who is willing to come to the table in 
good faith. I think the framework puts forward a number of general 
proposals that both parties can support. There is fertile ground for 
bipartisanship here if my Democratic colleagues are willing to set 
aside some of the unreasonable preconditions that they have put on 
their involvement in tax reform. The last time I checked, both 
Republicans and Democrats supported tax relief for low- and middle-
income families. The last time I checked, reducing our uncompetitive 
corporate tax rate was a bipartisan objective. The last time I checked, 
both Republican and Democratic voters were in need of higher wages, 
more jobs, and a more competitive economy.
  This is going to be a difficult process, whether it is bipartisan or 
partisan. There is a long list of sacred cows in our Tax Code, each of 
them with a constituency that will fight to keep them in place. We are 
going to have to eliminate a number of tax deductions and credits if we 
are going to be fiscally responsible, including a number of provisions 
that are, under the current system, pretty popular in certain segments 
of the country. The framework specifies two deductions that should stay 
in place because they benefit many in the middle class and they are 
designed to achieve important policy goals. Everything else is 
currently on the table, including items that I have personally 
championed in the past.

  We have already seen stories about how Republicans are already 
divided on the fate of the State and local tax deduction. Make no 
mistake--that is a pretty popular deduction, particularly among 
Democrats, but it has some Republican supporters as well. I would 
remind my colleagues who are adamant about preserving the State and 
local tax deduction that the benefits of that particular provision skew 
heavily toward higher income earners, especially those living in high-
tax cities and States. So if our main goal is to help the middle class, 
I would hope that there won't be many Senators who will fall on their 
swords in order to keep this particular deduction in place.
  Still, nothing is set in stone, and most items are currently still up 
for negotiation. The State and local tax deduction is, like virtually 
every other tax provision, currently on the table, and we may very well 
have to pare it back one way or the other. We need to see how the 
numbers work out before we can speak definitively on this or any other 
tax policy item.
  Before I conclude, let me just say that this is a once-in-a-
generation opportunity. There is currently more momentum in favor of 
tax reform than at any other time in the past three decades. All of us 
should be willing to take advantage of this opportunity. All of us 
should be able to give in order to get a final bill done that will make 
sense and will get us back on track. I am hopeful that we can have a 
bipartisan effort here, but whether we do or don't, I intend to see 
that we get tax reform done and that we get it done in the best 
interest of our country, the best interest of our people, and above 
all, the best interest of the middle class.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. CASEY. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.