[Congressional Record Volume 163, Number 182 (Wednesday, November 8, 2017)]
[House]
[Pages H8659-H8660]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        LEAVE NO TAXPAYER BEHIND

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 3, 2017, the Chair recognizes the gentleman from California 
(Mr. McClintock) for 30 minutes.
  Mr. McCLINTOCK. Madam Speaker, in the last four national elections, 
Americans made it clear that we won't accept the economic stagnation 
that we have suffered during this past decade.
  Mr. Obama's policies of higher taxes and regulatory burdens 
suppressed economic growth to a dismal 1\1/2\ percent annual average. 
That is about half of the post-war growth rate of 3 percent.
  President Reagan averaged 3\1/2\ percent annual growth by reducing 
the tax and regulatory burdens crushing the economy. The result was one 
of the greatest economic expansions in American history.
  The Trump administration has made significant progress on regulatory 
relief, as attested by rising wages, employment opportunities, and 
growing consumer confidence. But tax relief is vital to finish the job.
  The imperative should be clear. The American corporate tax rate of 35 
percent is the highest in the industrialized world. I know there are 
lots of special interest loopholes that go to politically connected 
companies that bring the effective rate down to 18.6 percent.

  But that is precisely the problem. Many companies that haven't gotten 
these breaks have simply fled the country, taking trillions of dollars 
and possibly millions of American jobs overseas. By closing the 
loopholes and lowering the rate to an internationally competitive 20 
percent, economists tell us that we can add $5 trillion to the American 
economy over the next decade. That averages about $40,000 per family.
  Those who dismiss this as tax cuts for wealthy corporations don't 
understand the dirty little secret of corporate taxation: corporations 
do not pay corporate taxes. They only collect them.
  There are only three possible sources from which they can collect 
them. The only people who pay corporate taxes are consumers, through 
higher prices; employees, through lower wages; and investors, through 
lower earnings. That is your pension and 401(k).
  Lowering the corporate tax rate not only means restoring America's 
global competitiveness, but it invariably translates into lower prices, 
higher wages, and greater returns on savings and investments.
  The personal income tax side is also important, and this is where I 
become concerned that we are getting wrapped around the axle.
  We have had several unpleasant surprises this past week: the 46 
percent bubble bracket and now the Joint Committee on Taxation report 
that, over time, many in the middle class may end up paying higher 
income taxes.
  Yes, the average taxpayer will pay less, but this raises the mystery 
of the 6-foot man who drowned in a pond whose average depth was 5 feet. 
It is now clear that some--perhaps many--families will see tax 
increases now, and more over time.
  As desirable as tax simplification is, I wonder if it is a bridge too 
far, given the timetable we are on, the hyper-partisan political 
environment we are in, and the complexities of the Tax Code that are 
certain to continue to yield unpleasant and unintended consequences.

[[Page H8660]]

  I urge our leadership and our Ways and Means Committee to consider 
leaving the personal income tax structure intact, but using the budget 
authority instead to provide a permanent, uniform, across-the-board 
reduction in the rates for all tax brackets.
  Our back-of-the-envelope estimate is that, using the current 
framework, we can reduce tax brackets by a full 1 percent, averaging 
about $600 of tax savings for joint filers. If we included the repeal 
of the individual mandate in ObamaCare, we could reduce all tax 
brackets by 1.35 percent, averaging about $800 of lower taxes for joint 
filers.
  I think there are four principal advantages to this approach:
  First, it leaves no taxpayer behind. Whatever your circumstances, 
whatever the deductions you claim, you can be sure that your overall 
tax bill will go down.
  Second, by reducing all marginal rates, it will increase the economic 
growth potential of the reform. Productivity depends on how much your 
next dollar is taxed.
  That is the marginal rate. We can bring down the top marginal rate 
under this reform; whereas, under the current proposal, it not only 
stays where it is, but in the bubble bracket, it increases to 46 
percent.
  Third, these reforms can be communicated easily to the American 
people.
  Fourth, it will remove a vast portion of the opposition that we are 
seeing among various business groups that imperils the entire bill.
  Madam Speaker, the tax reform bill that emerges from these 
deliberations will ultimately be judged by the prosperity that it 
produces and the relief that it brings to all American families.
  If it is done right, the tax reform bill now taking shape in Congress 
can deliver us to that day. But if it is done wrong, we will have 
squandered the most important chance the American people have given us 
to materially improve their lives.
  I remember the Reagan era. Wages rose, opportunities for better jobs 
abounded, and everywhere you could sense the optimism that comes with 
prosperity and abundance. I want my kids to know what it is like when 
morning dawns again in the American economy. It is up to us in this 
Chamber to make it happen, so we must.
  Madam Speaker, I yield back the balance of my time.

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