[Congressional Record Volume 163, Number 194 (Wednesday, November 29, 2017)]
[Senate]
[Pages S7394-S7402]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
TAX CUTS AND JOBS ACT
The PRESIDING OFFICER (Mr. Tillis). The clerk will report the bill.
The senior assistant legislative clerk read as follows:
A bill (H.R. 1) to provide for reconciliation pursuant to
titles II and V of the concurrent resolution on the budget
for fiscal year 2018.
The PRESIDING OFFICER. The majority leader.
Mr. McCONNELL. Mr. President, I ask unanimous consent that Senator
Wyden or his designee be recognized to offer a motion to commit the
bill, the text of which is at the desk. I further ask that the time
until 8 p.m. be equally divided between the leaders or their designees;
that at 8 p.m. the Senate vote in relation to the motion to commit with
no intervening action or debate; and that following the disposition of
the Wyden motion, the majority leader be recognized.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Oregon.
Motion to Commit
Mr. WYDEN. Mr. President, I call up the motion that I have at the
desk.
The PRESIDING OFFICER. The clerk will report the motion.
The legislative clerk read as follows:
The Senator from Oregon [Mr. WYDEN] moves to commit the
bill H.R. 1 to the Committee on Finance with instructions to
report the same back to the Senate in 3 days, not counting
any day on which the Senate is not in session, with changes
that--
(1) are within the jurisdiction of such committee; and
(2) eliminate provisions that would raise taxes on millions
of middle class taxpayers.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. ENZI. Mr. President, this is a historic day, as the Senate begins
consideration of tax reform that will help boost America's economy,
create more jobs, and leave more money in people's paychecks.
The House and Senate passage last month of the fiscal year 2018
budget resolution marked an important first step toward tax relief for
American families and job creators that will jump-start economic
growth. The resolution gave the Senate Finance Committee the headroom
to come up with comprehensive tax reform, and it instructed the Senate
Energy and Natural Resources Committee to save $1 billion. Finance
Committee Chairman Hatch and Energy and Natural Resources Committee
Chairwoman Murkowski both deserve praise for developing legislative
recommendations that fit with the budget resolution's reconciliation
instructions, and I thank them for their efforts.
Yesterday, the Senate Budget Committee took the next step by
combining the legislative recommendations from the Finance and the
Energy and Natural Resources Committees and reporting the combined bill
to the full Senate for consideration. This put our Nation one step
closer to real tax reform while advancing American energy security.
It is past time for us to act. A lot of things have changed since the
last major tax reform in 1986, and unfortunately our Tax Code hasn't
kept pace with those changes. It is an outdated mess that is hurting
American workers and holding back our economy. That is why we need tax
reform that will make our system simpler and fairer and allow people to
keep more of what they earn. The bill before us will do that. It will
help grow the economy, create jobs, and ensure that hard-working
Americans aren't missing available tax relief.
This bill also will provide relief to small, family-owned businesses.
We want to make sure that small businesses, which currently employ the
majority of the private sector in Wyoming and are the backbone of our
communities all over the country, have the opportunity to grow and
provide more jobs.
If you care about jobs, if you care about American companies staying
here and being able to compete globally, then you should also care
about reforming our business tax system. America has the fourth highest
corporate rate in the world. We need to encourage companies to bring
back their overseas money to increase the number of jobs here in the
United States. Lowering our uncommonly high and uncompetitive business
tax rate would be one of the quickest ways to solve the problem. It is
time we make America a more inviting place to invest, to do business,
and to create jobs.
We heard a lot of rhetoric yesterday in our committee meeting where
we reported this bill, and I expect we will be hearing a lot more of
the same arguments over the next couple of days. So I want to address
some of the claims made by my colleagues on the other side of the aisle
yesterday.
Several Members complained that there have been zero hearings on this
reconciliation legislation and that this has been a rushed process.
Nothing could be further from the truth.
The entire 2018 budget reconciliation process has been open,
transparent, and subject to regular order, starting with the passage of
the Senate budget resolution. The Senate Budget Committee marked up the
budget over 2 days and accepted amendments from both sides of the aisle
to make the resolution stronger. In fact, for the first time ever, the
minority was given a copy of the chairman's bill 5 days prior to the
start of the markup. According to many of my colleagues, it was one of
the most transparent budget resolution markups in history.
The budget resolution, complete with the reconciliation instructions
being used this week, was then debated on the floor in an open process
that allowed every Senator the opportunity to offer and vote on
amendments to improve the resolution before its final passage. That set
in motion the instructed committees' process for producing
recommendations.
Over the last 6 years, the Senate Finance Committee has held 70
hearings on how the Tax Code can be improved and streamlined to work
better for all Americans.
Earlier this month, the Senate Finance Committee held a 4-day markup
before finally approving tax reform legislation designed to modernize
our Tax Code. The markup lasted 23 hours and 34 minutes over the course
of those 4 days. Of the more than 350 amendments filed, 69 were asked
to be considered in committee. An additional 35 amendments, offered by
both Democrats and Republicans, were included in the final bill
reported out of committee.
On November 2, the Senate Energy and Natural Resources Committee held
a hearing to receive testimony on the potential for oil and gas
exploration and development in the so-called 1002 area of the Arctic
National Wildlife Refuge, or ANWR. On November 15, after adopting a
bipartisan amendment, the committee approved, with bipartisan support,
legislation authorizing responsible development in the 1002 area and
meeting the $1 billion reconciliation deficit reduction target.
Let me explain what we are talking about. ANWR is 19.3 million acres.
It is about the size of South Carolina. The 1002 area is 1.57 million
acres--about the size of Delaware. The area within 1002 that we are
talking about for development is just 2,000 acres, which is smaller
than the Fargo, ND, airport.
When the Budget Committee met yesterday, consistent with our
responsibility under the Congressional Budget Act, we were only allowed
to combine the recommendations of the two committees. We reported the
combined bill to the full Senate. As provided by law, no amendments
were allowed because, under the Budget Act, our committee is prohibited
from substantially changing either committee's approved
recommendations. Now that this bill is on the floor, however, it will
be subject to the amendment process. For reconciliation bills like
this, the amount of amendments that can be offered is unlimited.
Several Members yesterday accused us of no longer caring about
overspending and the debt. Again, this is completely false. Better tax
policy will boost the value of everything we produce, and this will
mean more revenue for the Federal Government.
The cost of this bill that you will hear my colleagues on the other
side of the aisle argue assumes the bill has little effect on the
economy. That assumption is based on the sluggish growth we have had
recently. In 2016, annual GDP growth was 1.6 percent, but our
historical average growth is 3.2
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percent. Under President Trump's efforts and the hope that he has
brought to working Americans, our economy has grown at more than 3
percent over the last two quarters. If we only get to 2.4 percent
growth in the private sector, this bill will be paid for. If we reach
3.2 percent growth, part of the debt will be paid down with the extra
revenue that will be generated.
We have tried stimulus, and it left us with the 1.6 percent. We have
tried cutting. In Washington, if you don't give the amount of increase
that people are asking for but you give them more money than they had
last year, that is considered a cut. So cuts haven't worked here,
either. So what is the other option that we have? Growing the economy.
Now, I want to repeat that in 2016 the annual GDP growth was 1.6
percent, but our historical average growth is 3.2 percent. And under
President Trump's efforts and the hope he has brought to working
Americans, our economy has grown at more than 3 percent over the last
two quarters, without this. If we only get to 2.4 percent growth in the
private sector, this bill will be paid for. I believe we can reach the
3.2-percent growth, and part of the debt will be paid down from the
extra revenue that will be generated.
Some people will say that after tax cuts before, the deficit has gone
up. I hope you check and see that the revenue has gone up, but the
spending went up bigger. It is like somebody winning the lottery and
spending their winnings twice.
This reconciliation bill will make concrete reforms to the broken
U.S. Tax Code and put the American economy back on a growth track. This
tax plan is an investment in hard-working Americans, one that will
produce more jobs and result in higher wages and a stronger and more
competitive American economy.
You are probably going to hear a lot of screaming going on in
speeches this week. Please don't confuse volume with veracity or truth.
I look forward to working with my colleagues to help pass this bill.
It will not only benefit hard-working Americans, but it will make our
economy and our country stronger.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oregon.
Mr. WYDEN. Mr. President, I listened to the remarks of my colleague,
the distinguished Senator from Wyoming, and he said there were 70
hearings on taxes. I think it is important that the American people
know that there was not one single hearing--not one--on this bill.
There were no discussions of the specific provisions in this
legislation. There was no hearing on the personal responsibility
requirement in the Affordable Care Act, which is so essential to that
law and to what we ought to be looking at strengthening in the years
ahead with respect to cost containment. So I just want to set the
record straight right at the outset of the debate. Since I have heard
once again that there were 70 hearings, I think it is important that
the American people know that there was not one on this bill.
Contrast this to 1986, when Democrats and Republicans got together
and there were more than 20 hearings--more than 20 discussions on
specifics about how to work together and find common ground on this
enormously important issue.
The Senate is 20 hours of debate away from a broken promise of truly
historic proportions. This was supposed to be the year that the working
people of America regained a powerful voice in Washington. Instead of a
strong voice, what they got was a big con job. If this Republican tax
bill passes, Washington is going to reach into the pockets of working
Americans and cut a big check to multinational corporations, to tax
cheats, and to the politically powerful and well connected.
The bill before the Senate would enshrine an economic double standard
that makes permanent second-class treatment of Americans who work hard
and do their best day in and day out to provide for their families. For
the cops, for the nurses, for the mechanics, and for those who work
retail, this Republican tax plan is a big gamble. They don't get any
special tax dodges--no Cayman Islands deals for them. Those folks are
stuck clinging to the hope that they will not be among the millions hit
with an immediate tax hike. Even for those lucky Americans who do see
some benefit, there is bad news coming down the pike. All they get out
of this Republican plan is the fleeting sugar high of temporary tax
cuts.
That is not the case, though, for multinational corporations or
powerful high fliers who wield big political power in this town. Under
this tax plan, the basic message to them is this: You can pay what you
want, when you want, and, if you are lucky--really lucky--you may pay
hardly anything at all. That certainly is not what working people were
promised in the fall 2016 campaign. That is not what Republicans have
spent month after month telling Americans their tax plan would do. The
Republican rhetoric doesn't match the reality of this tax plan, and
every day we get frightening news reports about the harm it is going to
do to working people and the middle class.
Just yesterday, I received a letter from the independent
congressional tax experts known as the Joint Committee on Taxation, and
they gave us really important information about the bill. Buried in one
of those answers was information that ought to put a scare into
millions of Americans who work hard every day to get ahead. This bill
showers trillions of dollars on multinational corporations, but the
fact is, these multinational corporations are already awash in cash.
What it means, according to these independent congressional tax
experts, is that interest rates are going up. The Federal Reserve will
have to tighten the screws of the economy.
But here is the bottom line for what it means for a middle-class
American in North Carolina, or Oregon, or anywhere else in the United
States: If you want to buy a house, this bill is going to make it more
expensive. If you want to buy a car, this bill is going to make it more
expensive. If you want to get a credit card, this bill is going to make
it more expensive. If you want to take out a student loan, this bill is
going to make it more expensive.
It is not just harm for typical families. The cost of doing business
is going to rise for the brewery owner or the tool-and-die maker who
wants to build a new facility or purchase new equipment. They would
like to hire new workers, but they will find that the money they need
to do it is getting drained by higher interest rates.
In short, higher interest rates will wipe out the benefits of this
bill for a lot of small businesses and add pain to the tax hikes that
are going to hit millions of families. The only businesses and
individuals who will not feel the effects I just described are those
sitting on mountains of cash--those who will never need to borrow to
get ahead. That is just one of the latest of truly frightening details
about what this destructive bill would do.
If there was any doubt remaining, it is clear based on those tax
experts that individual working Americans and families are going to be
on the hook for handouts to multinational corporations.
Republicans have spent months shouting from the hilltops that they
were bringing jobs back. The President made it a centerpiece of his
campaign. Jobs are coming home, he said. Corporations that ship jobs
overseas are going to be punished. The plight of so many mill and
factory towns is over. It is too bad that those talking points from
stump speeches and interviews never made it into the proposals on
paper, because the tax plan that is actually before the Senate does the
opposite.
Under the new notion of taxes for American companies overseas called
the territorial system, corporations will get a bigger tax cut if they
lay off their American workers here in the United States, pack up, and
move abroad. It creates colossal new loopholes, a true bonanza of new
tax gifts for the tax cheats, for the people who have sophisticated
help to cut corners.
When it comes to international tax rules, my view is that the United
States shouldn't get suckered into a race to the bottom with a bunch of
no-tax, resort-lined islands to please the tax avoidance industry and
their lobbyists. That is a truly expensive competition in terms of
taxpayer dollars and jobs, but this Republican plan forces working
Americans to pay up.
The tax experts we rely on here in the Congress make it clear that
the Republican corporate tax scheme loses
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revenue, but the individual tax changes raise revenue. That is a whole
lot of tax lingo for saying that working people are going to get
fleeced so that multinational corporations can pay a lot less.
Here is how it is going to work. More and more Americans will face a
tax hike with every passing year. Stealthy tax tricks will force people
into higher tax brackets over time, heaping a heavier burden on their
shoulders. Millions of working Americans are going to lose their
healthcare and the tax credits that make insurance affordable for them
and their family. Put all together, it is an immense amount of money
being taken from people who are already walking an economic tightrope--
an economic tightrope in North Carolina and Oregon and everywhere
else--where they balance food costs against the fuel bill and the fuel
bill against the cost of housing. An immense amount of money is being
taken from them and being handed to multinational corporations that
ship jobs overseas.
This is not a plan to create red, white, and blue jobs. This is not a
plan to turn the lights back on in factories that went dark many years
ago. This is a plan to sell out millions of Americans--American workers
and their families--and the damage will get even worse when the deficit
climbs into the stratosphere.
As I begin to touch on the deficit, I want to note that it didn't
have to be this way. I wrote two fully bipartisan Federal income tax
reform bills with our colleagues. I believe they were here before the
Senator from North Carolina joined us: Dan Coats, now the head of
national intelligence, and Judd Gregg, the former Republican chair of
the Budget Committee. The three of us--Senator Gregg first, then
Senator Coats--made changes to ensure that American companies could be
competitive for red, white, and blue jobs. We understood that you had
to have a competitive rate to grow those companies. But we certainly
didn't create new breaks for shipping jobs overseas, and--because I am
going to touch on the deficit now--our proposal was revenue neutral.
So it didn't have to be this way. That is what Senator Manchin and
Senator Kaine said yesterday, along with 17 Democrats. We wanted a
bipartisan alternative that didn't create new incentives for shipping
jobs overseas and that didn't jack up the deficit, but I certainly was
surprised when I saw early on that Senate Republicans, who had given so
many speeches on their concern about the deficit, said: It is kind of
OK with us if we have a net deficit of $1.5 trillion. And as the Joint
Committee on Taxation has essentially indicated to me, it would be
higher than that.
All of the deficit hawks in the Republican Party just flew away. That
was surprising because it seems like just yesterday when the Congress
couldn't buy lunch without a whole cast of Republican deficit hawks
doing some pretty serious hollering about the deficit. But based on
history, what is coming next is pretty predictable. We have seen the
movie before. The deficit hawks come flying back after ideas like the
one we are looking at in the Senate become law. We have already heard
the Speaker say, what is next? Entitlement reform, which means
Medicare, Medicaid, and anti-hunger programs.
The Speaker said that is what is next. That is next on the docket.
Everybody listening ought to know that is code for attack, and it is
multiple fronts on these kinds of programs for the most vulnerable
people in our country--the lifeline programs, the safety net programs I
have just described. What we are going to hear, because this is the
script from earlier movies, is we have these big deficits. Oh, my
goodness. There is a lot of red ink. America can't afford the safety
net. They will say we have to do something. Instead of being willing to
go after the people at the top, history says the people who really face
the burden of those deficit reductions are the most vulnerable.
The first big legislative push after the Bush tax cuts, for example,
was an all-out assault on Social Security. The fact that it was stopped
doesn't mean Medicare or Medicaid or other safety net programs like
Social Security are going to be safe this time around.
The policy on offer, in my view, is simply a disaster. It makes a
mockery of the approach Ronald Reagan took with a big group of
Democrats. I know so many of my colleagues on the other side of the
aisle admire President Reagan greatly. This bill is the opposite of
what President Reagan did.
What President Reagan did is he said to those big multinational
corporations: I have to ask you to give up some money in order to make
sure the middle class, the individual ratepayer, will get a fair shake.
This is just the opposite--180 degrees away from what Ronald Reagan
did. We are going to have an amendment on the middle class pretty soon,
but what could be more stark than the fact that the tax cuts for the
multinationals are permanent, and the relief for the middle class is
temporary. This bill is the opposite, the total opposite, of what
Ronald Reagan worked on in 1986.
Our colleague Senator Enzi--and I have worked with him often, and I
am sad to see us have such differing views on this--said we have had 70
hearings. I can tell you, the once storied Senate Finance Committee
never even attempted once to craft a bipartisan bill. We said for
months that was our preference. That was what was stated in the letter
the vast majority of Senate Democrats signed. That is what we said when
we were invited to the White House to meet with the President. We said
it repeatedly.
I mentioned the two bills I wrote. They are the only two bipartisan
Federal income tax reform bills--the only two we have had since 1986.
By the way, they didn't go as far as Ronald Reagan went. Ronald Reagan,
in 1986, said, for purposes of taxes, a dollar is a dollar is a dollar.
We are going to have the same rate for those who make money on
investments that we do for those cops and nurses who get that wage,
that ordinary income. I have indicated on the floor that Senator
Bradley, former New York Knick--and as I like to say, another tall
Democrat who served on the Senate Finance Committee with a much better
jump shot than mine--is incredulous at this process. He is just slack-
jawed when he asks about what is being done to bring both sides
together. Senator Bradley, and others on the Republican side, in 1986,
flew all over the United States to get together with senior Republicans
and Jim Baker, Richard Dorman, and others to talk about the specifics
of getting bipartisan tax reform together. You hear the stories, and
you see that is the way you tackle an issue like this. Bill Bradley
flew all over the country to work with Republicans to get a bipartisan
tax reform bill. Right now, the majority on the Senate Finance
Committee wouldn't walk down the corridor of the Dirksen building once
to talk about anything resembling how we would put together a
bipartisan proposal. So the process we have seen here makes a mockery
out of Reagan-style reform.
Some have asked, was this foreordained, did it have to be. I have
already made it clear that I don't think it had to be. It is hard work
putting together a bipartisan bill. Senator Gregg, for example, when he
was in the Senate, I think was one of Leader McConnell's top economic
advisers--chairman of the Budget Committee. We used to say in our
house, Judd Gregg is scary smart. We sat next to each other in chairs
in our office for almost 2 years to put together a bill. It is heavy
lifting, but it can be done. A lot of that work was brought into other
efforts since then--the question of the Bush proposal, bipartisan
commissions, or a variety of other ones. It is pretty hard to do when
the majority leader says, on the first day, the very first day out, we
are going to use the most partisan process--budget reconciliation and,
in effect, say: What we are telling the other party is we don't want
your ideas because we don't need your votes. Sometimes it got almost a
little ridiculous because I know there were times when statements were
made by the Republican leadership that no Democrats were interested in
bipartisan tax reform, despite the fact that in the few instances where
a White House official would call and ask our opinion, Senate Democrats
would meet. That was the point of the press conference that was
held yesterday with 17 Democrats from various parts of the country, as
well as legislation I have described that was written.
By the way, in the work product Republicans finally produced, they
took
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some of the ideas from the bipartisan bills; for example, increasing
the standard deduction, but we tripled the standard deduction without
any takeaways, like the State and local deduction or the permanent
exemptions, and what that meant is, in the bipartisan bills, if you
passed something like that, people adjust their wages, and immediately
working-class folks get hundreds and hundreds of dollars more in every
paycheck. Not only were there no discussions--and I have seen
Republican Senators stand out on the floor sometimes and hold up a
sign: What we are doing is the Wyden-Coats bill. Nothing could be
further from the truth, whether it is on the international provisions I
mentioned or the personal provisions. I was so proud to stand with
Senate Democrats in a meeting yesterday put together by Senators
Manchin and Kaine, once again, stating that it doesn't have to be this
way.
What is the rush to take taxes for multinational corporations from 35
to 20 percent? Back when I was working with Senator Gregg and Senator
Coats, the Republicans, we didn't have multinational corporations
saying we should go to 20 percent. The difference between 25 and 20
percent is $500 billion.
My colleagues yesterday were saying--moderate Democrats--we are
serious about tax reform, both on the individual and the corporate
side, but it ought to be based on bipartisan give-and-take, not
something like we have seen.
Republicans in Congress and the administration's top salesmen have
spent months and months telling the American people that in the long
run, their bill is going to pay for itself with explosive growth. They
had cheerleaders, those who cooked up these phony growth forecasts
based on revenue-neutral reform proposals that don't exist. Respected
economists will tell you tax cuts don't pay for themselves. In fact,
when we had a chance to have some discussion not about a specific bill
but some ideas about taxes, the Republican economists who were before
the Finance Committee said the tax cuts wouldn't pay for themselves.
The honest predictions say that any growth caused by this bill is
going to be modest. After they have spent years insisting--I can't tell
you how many times I heard this--that we would have dynamic scores,
Republican Senators are rushing the independent scorekeepers to try to
get a thorough analysis, but we don't have it as we are on this floor
debating the bill.
Finally, we ought to forget that this bill has been getting a rewrite
behind closed doors for weeks now. A number of my colleagues on the
other said what was important to them is we have what is called regular
order. Regular order is probably not a concept people talk about in too
many coffee shops unless they traditionally get eggs or toast or
something, but what it means is, you have a process where both sides
work together, and you have a chance to discuss ideas and differing
approaches or offers. We haven't had anything like that. We haven't had
an open process with open debate and real amendments. What we have seen
is a mad dash to pass a bill that can't stand scrutiny in broad
daylight. If this bill really got scrutinized and had a chance to be
examined, we would see a lot of Americans coming to their Senators and
saying: Senator, no way--no way--should you support that bill.
What is on offer is a plan to force working people and working-class
families to pay for handouts to multinational corporations and tax
cheats. This bill does not deserve to pass. My view is, it really
doesn't deserve the ink that was used to print it on paper. The process
that has culminated in this scramble to drive this through, drive it
through with the most arbitrary process imaginable, I consider
shameful.
With that, I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, the last time Congress modernized the
Tax Code was in 1986. That was more than 30 years ago, which is quite
obvious to anybody who can subtract. In the generations since, the Tax
Code has grown out of control. It has been a dream come true for whom?
The professionals in accounting and the lobbyists who protect the
loopholes. But it happens to be a real nightmare for most Americans. I
would say, for most Members of Congress, as one reads regularly, very
few Members of Congress do their own taxes.
The outdated Tax Code helps the powerful and the well connected but
hurts American workers. It hurts American industry, and it hurts
America's ability to compete with the rest of the world. That means
lower wages and less employment.
The bill that passed out of the Finance Committee moves us very much
in the right direction to make our Tax Code simpler, fairer, and more
competitive. At the heart of the legislation is a middle-class tax cut.
A typical family of four with two children making $59,000 a year could
see a tax cut of more than $1,700. That is very significant tax relief,
but you would never know it by listening to the rhetoric of my
colleagues of the other political party. They have repeatedly recited
the tired line that Republicans are only interested in giving tax cuts
to the wealthy. In fact, they began pushing that narrative even before
this bill was written. In going way back to September, they started
analyzing a bill that didn't even exist. It was a charge made by a
document that was put out, called the Big Six framework. But the
framework was no piece of legislation; it merely provided guidelines
from which to start for the tax-writing committees.
The partisan Tax Policy Center then filled in the gaps with policy
assumptions and crafted an analysis to fit its narrative and its
analysis of a piece of legislation that had not even been written. The
problem is that its narrative hasn't changed. The Finance Committee
provided policy details that it should have used to change its
narrative, but it still keeps with the same old rhetoric. I think even
the Tax Policy Center would have to agree that the Finance Committee's
product differs drastically from the underlying assumptions of its
initial analysis.
I am going to try to explain what the Tax Policy Center says about
the tax law that we ought to pass in comparison to our bill, and you
will see that there seems to be a real closeness in some of the ideas
that ought to be done that we get from the left that are in this bill,
but they don't even recognize it.
The Finance Committee used all of the available tools it was granted
under the unified framework to target more relief to middle-income
taxpayers and retain the progressivity of the Tax Code. Let's take a
look at some of the major features of the Finance's bill and how it
provides relief for the Nation's middle-class and low-income earners.
First, it nearly doubles the standard deduction, which means that
many lower income Americans will be removed from the tax rolls
completely and that tax filing season will be simpler for millions
more. Second, it doubles the child tax credit from $1,000 to $2,000 and
moderately increases its refundability. Both of these are made possible
in large part by repealing personal exemptions. Personal exemptions for
the taxpayer and spouse help to increase the standard deduction, and
the personal exemptions for children help with increasing the child tax
credit.
Interestingly enough, these provisions mirror a proposal that was put
out by the leftwing Tax Policy Center in December of just last year.
Nearly identical to the Finance bill, the very liberal Tax Policy
Center's paper argued for repealing personal exemptions, nearly
doubling the standard deduction, and increasing the child tax credit to
$2,012. According to the authors of the liberal Tax Policy Center's
proposal, such a change would ``reduce complexity, remove inequities,
and mitigate marriage penalties.'' That is exactly what the bill before
the Senate does, but they don't seem to recognize that. They sure
wanted that as a goal last year.
The fact is that these changes provide more tax relief to the middle
class and at the same time simplify the Tax Code. As the liberal Tax
Policy Center's paper points out, the value of the personal exemption
is largely dependent on the tax bracket of the taxpayer. The higher the
tax bracket, the more benefit that comes from the personal exemption.
In comparison, the child tax credit generally lowers a taxpayer's tax
liability dollar for dollar regardless of the tax bracket. As a result,
repealing the personal exemption
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in favor of expanding the child tax credit makes the Tax Code more
progressive and targets more relief to lower and middle-income
taxpayers.
Admittedly, there are some differences between what was suggested by
the liberal Tax Policy Center and what is in the bill before us. Its
proposal would have been more generous on the refundable feature of the
child tax credit, but on the opposite end, it would have made the child
tax credit available to everyone, including to millionaires. The
Finance's bill is less generous to the affluent because it phases out
the credit for married taxpayers with incomes of over $500,000. One
would think that those on the other side--meaning the Democratic
Party--in their finding fault with this bill, would offer some credit
for taking this rather progressive approach to providing family tax
relief, but no. They continue repeating their line over and over that
this bill is a tax cut for the wealthy.
Another major feature of the Finance's bill that provides relief to
middle-class and lower income earners is the reduction of tax rates for
middle-bracket taxpayers. First, it retains the 10-percent bracket,
which many on the other side expressed concern about being repealed
based on the Big Six framework. They were wrong in using the framework,
but they have not admitted that.
Next, it lowers the current law's 15-percent bracket to 12 percent
and expands its applicability.
Additionally, it reduces what is essentially the current law bracket
of 25 percent down to 22 percent and what is essentially today's
current law 28-percent bracket to a much wider 24-percent bracket.
These rate reductions target tax relief to the very heart of America's
middle class.
One may be wondering how this middle-class tax relief bill will be
financed--largely by repealing the State and local tax deduction, also
known as the SALT deduction. Our colleagues on the other side have
tried to argue that the repealing of the State and local tax deduction
is a tax increase on the middle class. Nothing could be further from
the truth in considering the reduced tax brackets, which I just
discussed, in combination with the higher standard deduction and the
doubled child tax credit.
The repeal of the State and local tax deduction is actually a very
key piece of this legislation that makes the middle-class tax cuts
possible. The State and local tax deduction overwhelmingly benefits the
so-called wealthy, who our colleagues on the other side vehemently
argue should receive no tax benefits under this bill.
I am going to tell you now how the liberal elements in this town see
the State and local tax deduction as something that should have gone
away anyway, and now they are complaining because we are doing away
with it. Don't take my word for it. Here is what several partisan think
tanks have said about the State and local tax deduction in the past.
According to the Tax Policy Center--remember that is the leftwing
organization finding fault with the bill even before it was written--
about 40 percent of the State and local tax deduction benefit goes to
taxpayers with incomes exceeding $500,000. So we do away with the State
and local tax deduction because it benefits wealthy people, and they
don't give us any credit for it.
Keep in mind that tax filers with incomes of half a million or more
make up only about 1 percent of all tax filers, making it a very
lopsided benefit. Here is what the very leftwing Center for American
Progress has said about the State and local tax deduction:
The deduction for state and local taxes disproportionately
benefits high-income taxpayers, property owners, and
residents of high-tax states. That is because these groups
pay the most taxes at the state and local level. It also
benefits high-income taxpayers because any kind of deduction
is worth more to people in high tax brackets than in low tax
brackets.
I just finished quoting the Center for American Progress, which said
that the State and local tax deduction ought to be done away with
because it benefits wealthy people. Yet they complain to us that our
tax bill is a tax benefit for the wealthy.
To further illustrate who eliminating the State and local tax benefit
really hits, I would like to highlight a recent Bloomberg article
entitled ``Tax-Hike Fears Trigger Talk of Exodus From Manhattan and
Greenwich.'' This article is not about the concerns of middle-class
police officers or teachers on repeal of the State and local tax
deduction. Instead, it highlights concerns of wealthy hedge fund
managers who may now consider moving out of the high-tax State of New
York. The Bloomberg article states:
The problem for the Connecticut hedge-fund set--and, more
broadly, for a lot of the Wall Street crowd--is that
Republican proposals in both the House and Senate would drive
up taxes for many high-earners in the New York City area. By
eliminating the deduction for most state and local taxes, an
individual making a yearly salary of $1 million . . . would
owe the Internal Revenue Service an additional $21,000.
This legislation repeals that deduction and makes the person making a
yearly salary of $1 million pay $21,000 more in taxes, and liberal
groups are proposing doing away with it, and we put it in our bill so
that we don't let these wealthy people get the benefit of the tax
deduction, and they don't recognize it. So I ask my colleagues on the
left: Are you prepared to go to bat over SALT deductions for
millionaire hedge fund managers?
From listening to my Democratic colleagues' rhetoric, I am really
surprised by this article. I thought Republicans were all about ``tax
cuts for the wealthy'' and giveaways to Wall Street. But this article
suggests otherwise. In fact, these types of taxpayers are likely to
experience sizable tax hikes under the proposal on the Senate floor
now.
According to the nonpartisan Joint Committee on Taxation, by 2023,
nearly 30 percent of taxpayers with incomes exceeding $1 million will
experience a tax hike. That does not sound like a giveaway to the
wealthy to me.
I yield the floor.
Mr. WYDEN. Mr. President, I ask unanimous consent that motions to
commit be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Motion to Commit With Instructions
Mr. WYDEN moves to commit the bill H.R. 1 to the Committee
on Finance with instructions to report the same back to the
Senate in 3 days, not counting any day on which the Senate is
not in session, with changes that--
(1) are within the jurisdiction of such committee; and
(2) eliminate provisions that would raise taxes on millions
of middle class taxpayers.
Motion to Commit With Instructions
Mr. Wyden moves to commit the bill H.R. 1 to the Committee
on Finance with instructions to report the same back to the
Senate in 3 days, not counting any day on which the Senate is
not in session, with changes that--
(1) are within the jurisdiction of such committee; and
(2) are made through regular order and a bipartisan process
resulting in substantive provisions contributed by both
parties.
The PRESIDING OFFICER (Mr. Lee). The Senator from New Hampshire.
Mrs. SHAHEEN. Mr. President, I agree with my colleagues that we need
tax reform, but we need tax reform that simplifies the Tax Code,
bolsters the middle class, and helps small businesses to create jobs. I
think we can do that, and we can do that in a fiscally responsible way,
but we need to work together, Republicans and Democrats, as we did the
last time we did tax reform.
Unfortunately, these priorities are not reflected in the bill that is
before us. Instead, it is a partisan, fiscally irresponsible giveaway
to the wealthy and the largest corporations in this country, and it
comes at the expense of the middle class and small businesses.
We know that the wealthiest Americans will see massive tax breaks
from this bill, including President Trump himself. In fact, the New
York Times has estimated that President Trump and his family would save
more than $1 billion from this tax bill.
How does this legislation pay for these tax cuts? Well, it asks
today's middle class and future generations to foot the bill. The
nonpartisan analysis from the Joint Committee on Taxation has found
that the bill will raise taxes on millions of middle-class families
making less than $75,000 a year. The bill sunsets any middle-class tax
breaks in 2026, and at the same time it makes tax breaks for large
corporations permanent. It increases the national debt by $1.5
trillion.
I think the headline in the current Forbes Magazine says it all. It
says
[[Page S7399]]
``The GOP Tax Bill Is The End Of All Economic Sanity In Washington.''
As more people look at this bill, they are beginning to see how it will
hurt middle-class families across the country.
Over the past few weeks, I have heard more and more concerns from
people throughout New Hampshire, and I just want to take a minute to
highlight some of these concerns. I met recently with the New Hampshire
Realtors and homebuilders. They are major advocates for home ownership
in New Hampshire. They told me that this bill is nothing short of an
attack on home ownership. In particular, they are concerned about the
impact of repealing the State and local tax deduction, which would be a
huge hit to middle-class families in New Hampshire. Right now, more
than 200,000 Granite State homeowners use the State and local tax
deductions so that they are not double-taxed. That is about one-third
of taxpayers in New Hampshire. It is particularly important to us where
property taxes account for 66 percent of all State and local taxes.
That is a higher share than any other State in the country.
Homeowners are also concerned about proposals to limit the mortgage
interest deduction, including on home equity lines of credit, where
homeowners in New Hampshire are going to get hurt more than others
because we have approximately 14 percent of homeowners who have a home
equity line of credit, compared to 3.8 percent nationally. The result
is, according to the Realtors and the homebuilders, that home values
will decline significantly.
According to the Association of Realtors, this bill will put downward
pressure on home values by as much as 18 percent in New Hampshire and
10 percent nationally. If we look at this chart for New Hampshire, we
can extrapolate this across the rest of the economy.
If we look at this tax bill, this is the impact on homeowners in New
Hampshire. Values are going to be reduced by about 18 percent. That is
equivalent to what we saw after the financial meltdown in 2008, where,
again, we had about that same reduction in property values--about 18
percent. That is a huge hit for us in New Hampshire and for people
across the country.
I thought the Realtors put it very well when they said: It is simply
unfair to ask homeowners, who pay 83 percent of all Federal income
taxes, to take a greater tax burden so that the biggest corporations in
this country can have steep tax cuts. It doesn't make sense.
I also heard significant concern from students, colleges, and
businesses that this bill will raise taxes on students trying to get
the skills they need to get ahead. That is really crazy because when we
do that, we don't create the workforce we need for the future. The
House bill, for example, would eliminate the ability of individuals to
deduct the interest on their student loans, and it would tax graduate
students on tuition assistance. I heard from a graduate student who,
right now, is making $20,000 a year on a stipend. That is what he is
trying to live on. If this bill goes into effect, he will pay $5,000 of
that in taxes. It doesn't make sense. We need to be encouraging our
students to get graduate and higher education degrees so that they can
take on the jobs of the future.
Again, in New Hampshire, it is a particular problem, where student
loan debt is higher than the national average. For the graduating class
of 2016, New Hampshire had the highest per capita student loan debt in
the country. The average debt for New Hampshire graduates was $36,367.
We know, nationally, student loan debt has roughly tripled since 2004
to a staggering $1.3 trillion. That is higher than the total credit
card debt. What this legislation is likely to do is to make that worse
for young people who are trying to get out of college, have their
student loans paid, get married, start families, buy a house. If they
continue to have this impact, they are not going to be able to do any
of those things.
The top challenge that faces New Hampshire businesses and so many
businesses across this country is finding skilled workers. The last
thing we should be doing is making education more expensive.
I also serve as the ranking member on the Senate Small Business
Committee. Small businesses employ more than half of our workforce.
They make up more than 99 percent of all employers. We need to work in
a bipartisan way to enact tax reform that supports our small
businesses. Again, this bill, unfortunately, doesn't provide meaningful
reform for small businesses and the problems they are facing with the
Tax Code. First of all, this bill doesn't address the top issue that we
have heard from small businesses--tax simplification and the cutting of
redtape in our Tax Code.
For entrepreneurs, time is one of their most valuable resources.
Every wasted hour spent filling out forms or navigating confusing tax
rules is an hour they can't spend innovating, marketing, and growing
their businesses. The tax system is so difficult to navigate that 89
percent of small businesses turn to outside tax preparers to fill out
their forms and file their returns. The compliance burden for small
businesses is 67 percent higher than it is for large businesses, and it
costs about $18 billion annually.
Tax reform should be an opportunity to help us help small businesses
focus on what they do best, and that is running their business.
Instead, this bill will result in even more redtape and complexity.
According to a former Joint Committee on Taxation economist, if this
bill becomes law:
Treasury will be writing regulations and Congress will be
enacting technical corrections for years. There are more
ticking time bombs in this bill than in a Roadrunner cartoon.
A recent poll of small business owners from Businesses for
Responsible Tax Reform found that a majority of them oppose the plan.
This is polling that has just been done in the last week or so; 61
percent oppose, and only 28 percent support.
Small businesses are even more concerned about the impact this tax
bill will have on our debt and deficit. In fact, 61 percent of small
business owners oppose raising the debt by $1.5 trillion to pay for tax
cuts.
Increasing the debt will inhibit our ability to address the real
challenges facing small businesses, such as educating a skilled
workforce, building out broadband in rural areas, and fixing our broken
infrastructure.
Then there is the repeal of the individual mandate, which is a part
of this tax proposal. According to CBO, repealing the individual
mandate, as this bill does, would cause 13 million Americans to become
uninsured by 2027. It would sharply raise premiums for those who
purchase insurance on the individual market.
Now, we have heard from our colleagues that they think that including
the Alexander-Murray legislation would help address that, but that is
not designed to address the underlying healthcare bill that we have in
this country. All that will do is address the uncertainty in the
marketplace.
Repealing the individual mandate is going to deny health insurance to
millions of Americans. It is going to cost middle-income families more,
and, ultimately, it is going to have an impact on people's abilities to
provide for their families and the long-term health of this Nation.
That is not the kind of investment we should be making in the future of
this country.
There are many more issues with this tax bill, but my time is
limited. If we look at who is opposed to this bill, there are so many
organizations: the Realtors, the homebuilders, the AARP, and the
Fraternal Order of Police. They have all come out in opposition, and
that is just to name a few.
I have heard from nearly 3,000 Granite Staters who have expressed
their opposition to the impact of this bill, and as more and more
people have a chance to read it, that number is going to continue to
grow.
You know I want to work with my colleagues here. I think Republicans
and Democrats should genuinely reform the Tax Code. It is long overdue.
But we need to do it in a way that is transparent, that looks at where
we want to go in the future and what we need to be investing in in this
country. We need to work in a bipartisan way that puts the middle class
and small businesses first and that doesn't leave a massive debt for
our children and grandchildren. If we pass this legislation, that is
exactly what we are going to be doing--leaving future generations to
deal with a massive debt without
[[Page S7400]]
the benefits of the investment that we should be making in this
country.
So it is a sad day for America.
I yield the floor.
The PRESIDING OFFICER. The Senator from Connecticut.
Mr. BLUMENTHAL. Mr. President, I am honored to follow my
distinguished colleague from New Hampshire and begin, actually, where
she finished. This massive tax cut has indeed so many ticking timebombs
that are unknown at the moment because it has been rushed and rammed
through this body, as well as the House, without the kind of regular
order that should be given--the intense scrutiny and attention that is
due a historic, massive measure of this kind.
The idea that it has regular order is absolutely absurd. If this is
regular order, it is surely regular order lite. There have barely been
the most cursory of hearings--barely an excuse for hearings--no real
markup, no real opportunity for the public to be heard, no real
scrutiny of the complicated and numerous provisions that will affect
people for years, decades, maybe generations to come.
The last tax cut was in 1985. The last so-called reform, passed in
the mid-1980s, involved scores of hearings, meetings, and sessions for
the public to be heard, dwarfing, making a mockery of this process.
This process has been, in fact, a mockery of democracy. It is a classic
bait and switch. It is a promise that is unfulfilled--a tax cut,
initially, for people, which then disappears after a couple of years,
when the wealthy continue to enjoy their tax cut.
There are winners and losers in this measure. Let's be very blunt.
The winners are the wealthy. The losers are the middle class. The
winners are special interests. The losers are the American people. The
winners are people who already have it made. The losers are people who
want to fulfill the American Dream and make it for themselves, people
who are pulling up the ladder for others to climb and to make it real
for them.
The measure that we have before us is the result of a promise--
middle-class tax cuts--and that promise was made by Donald Trump, who
said also that he would not benefit. He sent his Small Business
Administration Administrator, Linda McMahon, to Connecticut to say:
``Everyone will experience a tax cut.''
This plan is a scam. Yes, some people will receive a tax cut
initially, but if you earn less than $75,000 within the next decade,
you will be worse off under this plan. In Connecticut that means that
468,200 taxpayers in the bottom 80 percent of income distribution will
experience a tax hike under this plan. The majority of people in
Connecticut are losers, even though there may be a wealthy segment at
the very top of the income distribution who are winners.
Our children and grandchildren are surely losers because they will
inherit the whirlwind of additional debt. The $1.5 trillion
underestimates the amount of debt that will be added. I saw a cartoon
in one of the newspapers that showed a rowboat filled with water, and
one of the characters said to the other: Drill another hole in the
bottom of the boat to let the water out. And the sea was the Dead Sea.
That is what this measure does. It fills our boat--not only ours but
our children's and grandchildren's boats--with additional debt. They
are losers even though the wealthiest are winners.
The losers include, also, first responders. Earlier this month, the
president of the Fraternal Order of Police wrote a letter to the House
and the Senate leadership urging Members of Congress to protect the
State and local deduction as it is. This measure eliminates that State
and local deduction, devastating for Connecticut but also for first
responders, firemen, and police across the country, and our teachers
who depend on the adequacy of Federal funding for essential services,
which will be reduced.
Because there is no incentive for State and local taxes--they can't
be deducted anymore--States like Connecticut, New York, and California,
we know are the losers and our middle-class taxpayers are losers. That
is why the National Education Association has found that gutting the
State and local tax deduction will seriously harm already underfunded
public education, risking nearly 250,000 education jobs, including over
5,000 teacher jobs in the State of Connecticut. It will lead to about
$250 billion in cuts to public education over the next decade. While we
are talking about education, there is eliminating the deduction for
interest on student loans. What could be more stupid at a time when we
are encouraging young people to invest in their futures and we should
be investing in them?
Ultimately, also, the losers are our job creators, the folks who need
infrastructure, which will go unrepaired. Our roads, bridges,
railroads, VA facilities, broadband, airports, and ports are all
desperately in need of rebuilding--not just repair but true rebuilding,
modernization, and innovation.
There is no requirement or opportunity here for repatriation of the
trillions of dollars parked overseas. There is no provision for any
sort of incentive for companies to repatriate and invest in an
infrastructure bank. So we will continue to see neglect and disregard
for that very important infrastructure.
It is clear who will be the winners. Despite all these losers,
corporations that move overseas to evade taxes and benefit from special
interest loopholes to lower their effective tax rates are going to be
richly rewarded.
Senate Republicans have decided to open the Arctic National Wildlife
Refuge for oil and gas drilling.
Those special interests are the winners. The bill borrows $1.5
trillion so those special interests and corporations can have those
benefits, but it will also line the pockets of those corporate CEOs--
not just the corporations but the CEOs. That is equivalent to the cost
of all veterans' healthcare and benefit payments to every single
veteran in America over the next decade.
With $1.5 trillion, by the way, you could also pay off all the
student loan debt in America. Think of the difference in lives that
would make. Think of all the young students debt free. Think of the
vistas and the dreams that could be fulfilled. Think of the economic
growth that would be generated.
Think also of the false promises and the bait and switch. When
corporate CEOs were asked by the President's chief economic adviser,
Gary Cohn, how many of them will create jobs with these corporate tax
cuts, nary a hand went up in the audience. That is a picture that says
a thousand words.
I end my words now simply with a warning that Americans, far from
buying this bait and switch, will see the proof in their pocketbooks
and wallets. They will see the result of this consummately partisan
measure run through without regular order, without real consideration,
without the scrutiny that it needs and deserves, without public and
popular support if we move ahead as the Republican leadership
apparently appears intent on doing. Now is the time for us to show some
backbone. I urge my colleagues to do it.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nebraska.
Mrs. FISCHER. Mr. President, I rise this evening to speak about tax
reform, which is so important for families in Nebraska and throughout
this country. The last time Congress comprehensively reformed the Tax
Code was in 1986, and we all agree it is long overdue. My priorities
for tax reform have always been threefold: delivering relief to the
middle-class, unleashing small business growth, and making our country
competitive globally. This bill before us accomplishes these goals.
American families have struggled over the past decade, and too many
in our country have found themselves living paycheck to paycheck. Wages
for workers have stagnated while the prices of goods and services have
continued to climb. Things are only just starting to turn around and,
as I travel across my State, Nebraskans have begun to tell me they are
finally feeling confident about the economy again. That needs to
continue, and the best way to do it is by putting more money back into
the pockets of regular Americans. This bill does that in one of the
best ways possible, by doubling the standard deduction and protecting
the first $24,000 that married couples earn and the first $12,000
individuals earn from Federal taxes.
Increasing the standard deduction is pro-family, and it helps to
foster the American dream. It not only leads to Americans keeping more
of their hard-
[[Page S7401]]
earned money, but it also means that simplifying the code will help
them save money in tax preparation as well. According to the
nonpartisan Tax Foundation, a married couple with two kids making
$85,000 per year, will see their taxes decrease by $2,224. This reform
provides money that will allow Americans to plan for their future and
to pay their bills. It can be a downpayment on a house or it can be put
away for future college tuition or for retirement. It gives millions of
earners more empowerment to use these savings for their lives as they
see fit.
Simplifying the code isn't the only family-focused provision included
in this legislation. The Senate bill doubles the child tax credit from
$1,000 to $2,000 per child. According to the Department of Agriculture,
parents of a child born in 2015 are likely to spend more than $233,000
raising a child to age 17. That doesn't even include college tuition.
Doubling the child tax credit will allow families to keep up to an
additional $4,000 every year if they have two children or more. This
credit builds a stronger future by helping families all across our
country keep more money to raise happy and healthy children.
In addition to these changes, this legislation will preserve many
other popular deductions. This includes the charitable deduction,
medical expense deduction, the student loan interest deduction, the
mortgage interest deduction, and the low-income housing tax credit.
This bill also continues popular savings programs such as the 401(k)s
and individual retirement accounts. These saving incentives are key
tools that allow individuals to provide for their families and to
prepare for retirement. It empowers Americans to plan ahead.
There are also commonsense provisions in this bill that have been
overlooked during the current debate. These are changes everyone here
can agree are long overdue. For example, this reform takes away the
tax-exempt status for professional sports leagues. We all love sports,
but professional sports leagues like the NFL and the PGA shouldn't be
allowed to use exemptions for nonprofits to avoid paying taxes. These
are for-profit leagues where commissioners make tens of millions of
dollars. They should be treated for what they are, and that is a money-
making enterprise.
I also want to take the time to address a misconception. Some have
argued that this bill will tax the tuition waivers graduate students
receive from their universities as a part of attending to their
studies. There is no such provision. Ph.D. research is a staple of
higher education, and it drives our Nation's innovation. It helps us
better understand our world and often leads to incredible technological
advancements. We in the Senate support graduate studies, and none of us
want to make it more difficult to obtain graduate degrees or do
research at the highest levels. We will not be taxing you for tuition
you don't pay while earning a master's or doctorate degree.
There are some other important provisions in this bill that haven't
gotten the attention they deserve, and I want to take a moment to
discuss some of them. The Senate tax reform retains nearly all of the
education incentives that are present in the current Tax Code for
students and for teachers. For example, we keep the Hope credit, which
allows taxpayers a credit of up to $2,500 per student, per year, for
qualified tuition or related expenses. We also keep both the Coverdell
and the 529 education savings accounts. These accounts promote saving
for school, and they help parents prepare for future tuition. Finally,
we double the educator deduction, which helps teachers make their
classrooms as friendly for learning as possible. This is a pro-
education tax reform bill, and it acknowledges education is a key to
our country's future success.
We must also recognize that our economy has changed over the last few
decades, and our Tax Code needs to catch up to the times. We have the
chance to make history, one that will help working families. My Strong
Families Act, which is included in this legislation, would be the first
nationwide paid family leave policy in American history. If we want to
build a better future for our children, we must tackle problems for
families juggling those responsibilities between home and the
workplace.
This plan has the potential to make life much easier for working
families across our country by providing a tax credit as large as 25
percent for employers who offer up to 12 weeks of paid family leave to
their employees. Under programs set up by employers, employees would be
able to take an hour, a day, or weeks off for purposes like taking care
of a sick child or an ailing parent to make sure they get to a doctor's
appointment. They could also take maternity or paternity leave to bond
with a newborn or recently adopted child.
In 21st century America, the number of dual-income households is on
the rise. According to the Department of Labor, 70 percent of mothers
with children under 19 participate in the labor force, with over 75
percent employed full time. For those without the means to take unpaid
time off, the burdens of caregiving are a real burden. A recent study
from the Pew Research Center found that most individuals who make
higher salaries usually have access to some kind of paid family leave,
but those making less than that are not always covered. This is why my
paid family leave plan limits eligibility to those earning below
$72,000 per year. We want these benefits to target hourly and lower
salaried workers. We want to increase access to paid family leave for
those who need it the most.
While my friends on the other side of the aisle focus on the stick
approach to paid family leave--pushing mandates or the creation of new
government programs--this bill pursues the carrot approach, and
Americans agree with us. A recent study showed that 87 percent of
Americans supported a limited government approach that enables
employers to provide the benefit themselves.
It is not hard to understand why. The plan balances the need of 21st
century workers with the real-world challenges that small businesses
face today. Eric Dinger, who is the CEO of a Lincoln startup named
Powderhook, put it the best. Eric told me:
I want to offer my employees paid leave, but a mandate
forcing me to do so would be hard. I have to make payroll.
[The Strong Family Act] is much more workable and wouldn't
provide a disincentive to hire anyone.
I agree.
Another of my constituents, Alison Ritter--an employee at Applied
Systems, Inc., in Lincoln--is helping her company's leadership develop
a paid leave policy. In reaction to my bill being included in the tax
reform proposal before us, she told me:
This concept would change the game for many newborn babies
and their parents, allowing them the time they need to bond
and establish a nursing routine without as much of the stress
and guilt they face today. It would provide families with the
financial support they need in order to do what's best for
their family, but also help businesses that struggle with
putting a plan in place due to the financial burden extended
absences create. . . . Our country wins when we focus on and
invest in healthier families.
Sara Rasby, who is the co-owner of Lotus House of Yoga, which has
locations across my State agreed:
It is refreshing to see a policy that supports the family
and small business unit. As co-owner of a small business and
a mother of two young children, I know firsthand how
challenging it can be without paid leave. A mother and/or
family needs time to adjust and bond. . . . This bill would
help parents, families, and small business owners be more at
ease with the transitions and changes that come with
maternity leave. Additionally, it will create more community
awareness on the importance of supporting the family
structure through policy.
We need to get this done for people like Eric, Alison, Sara, and
other business owners, caregivers, and working parents throughout the
country.
I also said my goal in this process is to promote policies that will
ensure small businesses succeed. There are over 29 million small
businesses throughout our country, and these small firms drive our
economy. They have generated over 60 percent of the new jobs created
over the last two decades and have made up nearly 98 percent of our
exports. They are often the face of our country to the world.
This reform will provide small businesses with additional incentives
to invest and grow. When small businesses make money, they invest it
back into their businesses and help grow their local economy. Places
like Lincoln and Omaha are well known to the entrepreneurial community
as bustling hubs of
[[Page S7402]]
innovation. This bill provides a 17.4-percent deduction for the large
majority of small businesses, which will lower their tax bills and give
them more financial flexibility. The preservation of things like the
1031 like-kind exchanges and the stepped-up basis will further help our
small businesses, especially agriculture businesses.
Small businesses don't have the professional resources to deal with
the Tax Code that comes in at over 74,000 pages. Simply doing taxes--
let alone paying them--has become a burden on too many of our small
companies. Moreover, they cannot take advantage of all the corporate
deductions or the little-known loopholes like big companies can. This
is not fair. It hurts our competitiveness globally, stifles strong
economic growth, and it favors big corporations, which have offices
full of lawyers and accountants. This tax reform lessens this disparity
and deserves support from everyone who wants to promote American
entrepreneurialism.
Lastly, this legislation goes a long way toward making America
competitive internationally. A large part of this is lowering the
corporate tax rate. At 35 percent, America's corporate tax rate is a
full 13 percentage points higher than the average rate of our
competitors from the developed world. This is a big reason why
companies are fleeing our shores, and they are choosing to set up their
headquarters or invest outside of America. These so-called inversions
have been on the rise in recent years, and there is little reason to
think that trend will reverse if we stand by and do nothing.
This legislation will put us in line with our trading partners and,
once again, make America an attractive place for business, which will
lead to more jobs and higher wages for our country.
The PRESIDING OFFICER. The Senator from Oregon.
Motion to Commit
Mr. WYDEN. Mr. President, I ask unanimous consent to speak for 3
minutes to wrap up on the first vote we are going to have on my motion.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. WYDEN. Mr. President, this first motion, the first motion the
Senate is going to vote on, is a straightforward proposition. The
motion says: Let us send this bill back to the Senate Finance Committee
on a bipartisan basis and come up with a plan that actually works for
the middle class.
I am going to wrap up just by recapping the Republican rhetoric on
this tax plan. First, it was said to be a guaranteed middle-class tax
cut. Then, it was merely focused on the middle class. Next, it was an
average tax cut across a variety of income cohorts. Now the numbers are
actually in. Republicans want to run up enough red ink to threaten
Medicare and Social Security and still raise taxes on more than half of
the middle class. The Senate, on a bipartisan basis, can do better than
this.
I urge my colleagues to support this proposal to send the bill back
to the Finance Committee and, on a bipartisan basis, come up with tax
reform that actually works for the middle class.
I yield back.
The PRESIDING OFFICER. The question is on agreeing to the Wyden
motion.
Mr. WYDEN. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The clerk will call the roll.
The bill clerk called the roll.
Mr. CORNYN. The following Senator is necessarily absent: the Senator
from Arizona (Mr. McCain).
The PRESIDING OFFICER (Mr. Gardner). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 48, nays 51, as follows:
[Rollcall Vote No. 285 Leg.]
YEAS--48
Baldwin
Bennet
Blumenthal
Booker
Brown
Cantwell
Cardin
Carper
Casey
Coons
Cortez Masto
Donnelly
Duckworth
Durbin
Feinstein
Franken
Gillibrand
Harris
Hassan
Heinrich
Heitkamp
Hirono
Kaine
King
Klobuchar
Leahy
Manchin
Markey
McCaskill
Menendez
Merkley
Murphy
Murray
Nelson
Peters
Reed
Sanders
Schatz
Schumer
Shaheen
Stabenow
Tester
Udall
Van Hollen
Warner
Warren
Whitehouse
Wyden
NAYS--51
Alexander
Barrasso
Blunt
Boozman
Burr
Capito
Cassidy
Cochran
Collins
Corker
Cornyn
Cotton
Crapo
Cruz
Daines
Enzi
Ernst
Fischer
Flake
Gardner
Graham
Grassley
Hatch
Heller
Hoeven
Inhofe
Isakson
Johnson
Kennedy
Lankford
Lee
McConnell
Moran
Murkowski
Paul
Perdue
Portman
Risch
Roberts
Rounds
Rubio
Sasse
Scott
Shelby
Strange
Sullivan
Thune
Tillis
Toomey
Wicker
Young
NOT VOTING--1
McCain
The motion was rejected.
The PRESIDING OFFICER. The majority leader.
Amendment No. 1618
(Purpose: To improve the bill)
Mr. McCONNELL. Mr. President, on behalf of Senators Hatch and
Murkowski, I call up amendment No. 1618.
The PRESIDING OFFICER. The clerk will report.
The senior assistant legislative clerk read as follows:
The Senator from Kentucky [Mr. McConnell], for Mr. Hatch,
proposes an amendment numbered 1618.
Mr. McCONNELL. I ask unanimous consent that the reading of the
amendment be dispensed with.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
(The amendment is printed in today's Record under ``Text of
Amendments.'')
Mr. McCONNELL. Mr. President, I ask unanimous consent that following
leader remarks on Thursday, November 30, the Senate resume
consideration of H.R. 1, with 1 hour of debate remaining on the Hatch-
Murkowski amendment. I further ask that any debate time tonight count
against the underlying bill.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
____________________