[Congressional Record (Bound Edition), Volume 146 (2000), Part 11]
[House]
[Pages 15914-15920]
[From the U.S. Government Publishing Office, www.gpo.gov]



                             NIGHTSIDE CHAT

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 1999, the gentleman from Colorado (Mr. McInnis) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. McINNIS. Mr. Speaker, first of all, I would like to go basically 
over what the comments that I am going to make this evening, but I 
guess it would be appropriate to make a couple comments about this 
weekend back in Colorado.
  First of all, I would like to express deep appreciation for all the 
firemen and the firefighters that are so courageously fighting the 
forest fires that we have out there in Colorado.
  As many of my colleagues know, my district is the Third Congressional 
District of the State of Colorado. That district geographically is 
larger than the State of Florida. It is essentially all the mountains 
of the State of Colorado. As one can guess, it is the highest district 
in the United States. So we have a lot of lightning strikes and so on.
  We do have a major fire down at Mesa Verde National Park down at the 
Four Corners of Colorado. Right now it has consumed about 17,000 acres. 
The conditions are very tough to fight the fire. But we have got a lot 
of volunteer firefighters. We have a got a lot of volunteers from the 
community. We, of course, have our own fire fighting teams. We have got 
the bombers in there. We have got the helicopter pilots. We just have a 
lot of cooperation out there in Colorado. So I thank my colleagues for 
their expressions of support, and I do want to express my deep 
appreciation for all of the people out there in Colorado who are 
helping get an upper hand on the fires right there in their Third 
Congressional District.
  Second thing I would like to mention to my colleagues before I go 
into my comments, and that is I had the privilege Friday of speaking at 
a service for a Colorado State patrolman, Captain Fred Bitterman. 
Captain Bitterman was a well-respected officer of the Colorado State 
Patrol.
  I used to be a police officer. I used to know the captain. Of course, 
I was not on the State Patrol. I was a city police officer.
  The service was a very moving service. He has a wonderful family. His 
commitment to the State of Colorado, his commitment to the Colorado 
State Patrol, his commitment to his friends, his commitment to the 
communities was all well represented at that service.
  We are going to miss him. The captain did a good job. He was a very, 
very good man. I have entered into the Congressional Record a 
congressional tribute in honor of the service that he gave to us. He 
will be sorely missed.
  Mr. Speaker, this evening I would like to address three fundamental 
subjects, and they are fundamental especially for the younger 
generations of this country. For the people that are, say, below 45, 45 
and under. We hear a lot of discussions going on, but what is the real 
focus for the future?
  There are three items that I would like to talk about that I think 
focus on the future that our young people that are under 45 years of 
age should take special interest in, because I think our generation 
over 45 years of age owes something to this generation, not owes in the 
way of a giveaway, but owes in the way that we have a responsibility to 
move this country forward in such a fashion that these three elements 
have some sense of protection or some sense of right direction for the 
generation that follows us.
  The first topic that I am going to visit with tonight is this death 
tax. Then I am going to move from the death tax into the marriage 
penalty. Then from the marriage penalty, I would like to talk about 
Social Security. In all three of these areas, there is a distinct 
difference between what the administration, President Clinton and Al 
Gore, are advocating and what is being advocated by the Bush team. I 
think it is fair to reflect on those this

[[Page 15915]]

evening when I have these discussions with my colleagues.
  Let me first of all begin on the death tax. As my colleagues know, I 
have spoken several times on this House floor in regards to what that 
death tax does and how devastating it is in this community. What has 
been of interest is the people opposed to this, including the Clinton 
administration, and, by the way, I refer specifically to the 
administration's policies, because I want my colleagues to know here in 
the House of Representatives we actually had 65 Democrats who voted to 
eliminate the death tax. So here in the House we have had a bipartisan 
effort, both Democrats and Republicans, going out there and recognizing 
just how punitive, how punishing the death tax is.
  Well, since the debate started taking place on this several weeks 
ago, I have noted a number of different comments in our national press. 
One thing that is of special interest, I think, or a counterpoint I 
guess one would make, my point being that the death tax is devastating 
for a community as a whole; and the counterpoint that is being put out 
there by some of the liberal media writers I guess one would say is, 
wait a minute, all this does is favors the wealthy in this country.
  Well, I want to talk about what I call the trickle-down impact of 
what that death tax does, not only just in a community, but what it 
does to family farms and family ranches.
  For example, right here, we will have a family ranch. Now, I can tell 
my colleagues that most working ranches, at least the ones I am 
familiar with, and I have been on a lot of ranches in my career, but 
most of the family ranches that I am familiar with in Colorado are what 
we call working ranches. What we mean by a working ranch is that the 
family actually has to make a living off the ranch. They do not own the 
ranch for the beauty or the esthetics of having a ranch. They own it 
because that is how they provide a living for their family.
  One of the assumptions that is being made by some of the opponents of 
this, including the Clinton administration, who seems to think that if 
one owns a ranch in Colorado or a ranch in Wyoming or a farm in Georgia 
or a farm in Kansas, that one automatically should be classified as the 
wealthy people of this country and one should be punished upon the 
event of one's death.
  In other words, the Clinton administration says that death is a 
taxable event. In fact, the Clinton administration feels so strongly 
that death should be a taxable event that this year in President 
Clinton's budget that he has sent to us, the administration's budget, 
they actually call for an increase in the death tax, an increase in the 
death tax.
  We clearly, including the Republicans and 65 Democrats, have a 
fundamental difference with the administration Clinton-Gore in that we 
do not believe that death should be a taxable event.
  Well, let us go back to that working family or working ranch out 
there in my district since that is where I am the most familiar. Some 
of these people are saying, well, you go out there and tell these 
people to buy life insurance, you know, go out, and that way, when they 
pass away, because the government, frankly, the administration has 
pushed this as a taxable event, why you will have the life insurance. 
Upon the death of the owner of the ranch, why it is no problem. The 
life insurance pays the government these taxes.
  Well, do my colleagues know what? That is based on an assumption that 
these working family farms and ranches in Colorado and elsewhere in 
this country make enough money to pay the premiums to buy the life 
insurance. Do my colleagues know something? Most of the farmers and 
ranchers that I know in my district no more have the money which would 
be, by the way, several tens and tens of thousands of dollars at a 
minimum every year just for the premiums, they no more have that money 
than they do extra cash in the bank.
  What happens when one keeps this death tax? Oh, sure, one may think 
that one is going after the Rockefellers or the Carnegies or the 
Kennedys or the people like that, the Forbes or the Gates in our 
country, but, in fact, those are the families who have their money and 
the resources to do estate planning. They have their foundations and so 
on. So one would be surprised at the minimal impact there is on those 
families.
  Where the impact is is these families that have, for example, as one 
says, has land, and they work it as a ranch in Colorado, but when they 
die, the land all of a sudden which has appreciated in value, after 
all, the one family I am speaking of, they have had the family ranch 
for 125 years, there has been an appreciation in that 125 years.
  Well, what happens? The only thing that can possibly happen is that 
that ranch is going to cease to exist. There is no choice. The death 
tax is devastating on family farms and family ranches in this country.
  Is this country not in the business of encouraging family farms and 
family ranches from going from one generation to the next generation? 
Is that not what our policy should be? Should not we stand up and say, 
hey, in America, in America, we want these farms to go from one 
generation to the next?
  But that is not what is happening in this great country. What is 
happening in this country is, as long as we have that death tax in 
existence, we are discouraging, not encouraging, we are discouraging 
the possibility that that family farm will pass to the next generation.

                              {time}  1915

  And is that really the policy that we want? Clearly, some of my 
colleagues over here, who have supported the Gore/Clinton policy, 
actually want an increase in the death tax. They support that budget. 
But 65 of the Democrats and all the Republicans have said, wait a 
minute, we should be, in this country, in the business of encouraging 
that this goes from one generation to the next generation.
  The other thing that I want to bring up that is being widely ignored 
by the critics and the media, who are criticizing us because we are 
saying that death should not be a taxable event, the media that is 
criticizing us for saying that death should not be a taxable event are 
ignoring something. They keep coming out and saying this is for the 
wealthy. Well, take a look at what it does to a community.
  For example, I know a small community in Colorado where there was a 
fairly wealthy individual, the person was a millionaire in that 
community, and upon his untimely death the Government came in and taxed 
his death. And what did they do with that money? Did they keep it in 
that small community? Of course the Government did not allow that money 
to stay in the community. It was not enough for the Government to take 
it away from someone they said was a wealthy person; and by the way, to 
qualify for that, if someone is a contractor, for instance, all they 
have to really do is own a bulldozer, a dump truck, and a backhoe and 
they have to worry about estate taxes.
  Let us look closely at that logic. Citizen A is very wealthy. Let us 
follow the logic. Now, I do not agree with the logic, but let us follow 
the logic some of my colleagues have. Their logic is just simply 
because the person is wealthy, based on that fact alone, just because 
they are wealthy, we should tax them on their death. Well, if we follow 
that logic, then we should say, okay, tax the wealthy person, punish 
them, go after them simply because they are wealthy.
  Then what is done with the money? As my colleagues know, this money 
does not stay here in the community. It does not stay in this community 
and continue to go to the local church, or charities or help provide 
jobs or create capital or create investment in that community. That 
money is sucked out of that small community; and it all goes east, to 
Washington, D.C., where the bureaucracy takes it and redistributes it, 
takes the money from the small communities, whether in Kansas or out in 
California or up in Wyoming or Montana or Idaho, takes the money from 
those death-taxed estates and takes it out of those communities and 
ships it to Washington, D.C., back here in the East, and then it is 
redistributed. And that has a very negative impact.

[[Page 15916]]

  What these editorial writers who support the death tax, what they 
should put in their editorials is not what it does to the wealthy 
family, although in fairness they should say what it does to a small 
business owner or a rancher or a farmer; but they ought to be fair and 
talk about what happens to that next generation. They also ought to be 
fair to the rest of the community where that individual lives and talk 
about what happens to that community, especially a small community 
where that money is sucked out of the community and sent to the East. 
Obviously, it has a very negative impact.
  I thought I would bring up a couple articles here and read them for 
my colleagues. I do not like to read verbatim, but I would just like to 
just speak to these because I think these are important.
  Every June for the past 8 years Jeannie Mizell, owner and manager of 
Mizell Lumber & Hardware Company, has sent the Government a check for 
$19,000. She will have to continue to send that check for the next 7 
years. This money is not income tax on profits; the money is because 
the company is profitable. It has been in business for 78 years, 78 
years in that community and in her family. It is the price that she is 
being forced to pay by the Government because she inherited the 
hardware store from her father and her mother.
  ``It is not a very pleasant feeling to get that letter in the mail 
every May,'' says Mizell, speaking of the Federal death tax bill. ``My 
father, who joined with his father in the family business in 1947, 
worked very hard, 6 days a week for 37 years, and he paid his taxes 
every year on time. He did not owe any past taxes and he should have 
been able to keep the money he accumulated and pass it on to the next 
generation so that our generation could have an opportunity to have the 
lumber company and the hardware company.''
  Instead, after her parents died, the Federal Government steps in and 
nails them with a death tax of over $300,000; with another $45,000 
which had to be spent by Mrs. Mizell just to get the appraisal done of 
the lumber company so the Federal Government could figure out just 
exactly how much money they wanted out of that estate. That is what the 
death tax does.
  By the way, this is not Home Depot we are talking about. This is a 
small family hardware and lumber business. This is what is being 
punished out there. If my colleagues think Home Depot is going to 
suffer as a result of the death of one of their founders, they are not. 
They have got the planning; they have the resources to plan for it. It 
is the small lumber companies, the small families in small-town America 
that is being punished by these death taxes.
  Here is another one. ``My name is Leanne Ferris. My family lives in 
the central part of Idaho. Our family's cattle ranch is 45 miles 
northeast of the Sun Valley area and the Lost River Valley. The ranch 
consists of 2,600 deeded acres and a cow-calf operation with 700 head 
of cattle.
  ``My youngest brother, Ross, lives with and manages the ranch with my 
mother. Although I'm still very involved in the ranch, my husband and I 
also operate a design business in Ketchum, Idaho. My brothers and 
sister and I all grew up working alongside my mother and my father and 
my grandfather. We worked weekends and holidays and summers branding 
and moving cattle, riding the range and fixing fences. We didn't have a 
lot of material things, but we had our family, we had the land, and we 
had the life-style.
  ``On October 5, 1993, my father was accidentally killed when his 
clothing got caught in a farm machine. He was 71 years old, and he was 
very healthy. He worked from dawn to dusk and he loved the land. He 
loved his family. We all worked as a team. We were always a very close-
knit family and the hub of our family was my father and our ranch.
  ``Even though my brother Jack and my sister Cary and I do not live 
there anymore, we all go home, along with the grandchildren, to help 
with the seasonal work. My daughter and I take as much time off in the 
summer as we can so that we can work at the summer cow camp in Copper 
Basin moving the cattle. My mother puts on a lot of church and 
community picnics and barbecues down by the swimming hole. Every June 
our family enters the local parade with a float representing our ranch, 
and all our other ranchers and their families in the valley do the 
same. Last year, the theme for the parade was the Mackays Heritage 
Ranching Mining and Logging.
  ``My father's death was the most devastating event any of us had ever 
gone through. The second most devastating event was sitting down with 
our estate attorney after my father's death. And I will never forget 
what the attorney said. `There is no way you can keep this ranch. 
Absolutely no way.' Still in shock from the accident, I asked, `How can 
this be? It's our ranch. We own the land. We've paid the taxes. We have 
no debt. We just lost our father, and now we're going to lose the 
ranch, the very thing which was the centrifugal force of keeping our 
family together along with our father?' our attorney proceeded to 
pencil out the death taxes that would be due after my mother's death, 
and we all sat back in total shock. It had taken my grandfather and my 
father their entire lifetimes to build up this ranch.''
  Let me repeat that. ``It had taken my grandfather and my father their 
entire lifetime to build up this ranch, and now we cannot continue on, 
and the grandchildren cannot enjoy the land and the rich life-style.'' 
Now, not rich in monetary terms, but rich in life-style, of going out 
and working hard in the fields. They do not get to have that any more. 
It provided a rich heritage. Rich, again meaning the character, the 
heritage that was there that is now going to be taken by the Government 
on taxes that have already been paid on this property.
  ``It has been three and a half years on my father's death, and we 
still don't know what we're going to do. We only know we're not going 
to be able to keep the ranch unless something can be done with the 
estate tax now. The estate tax on our family ranching assets is going 
to be estimated at $3.3 million. Without the land being paid for and 
tight operating costs, we will not be able to make money from the 
business. To spread that tax over 14 years at the 4 percent interest is 
of absolutely no value to us.''
  In other words, what she is saying, my colleagues, is do not come to 
us out in small-town America and our families in ranching operations 
and tell us that we are being done a great big favor because the 
Government is going to allow us to finance the death tax over a period 
of 14 years.
  ``All this means is that we're going to have to pay an amount of 
money which is virtually impossible. In order to try to buy a life 
insurance policy, we're going to have to sell one of the spring ranches 
now, and that might allow us to pay off one-third of the death tax and 
avoid a fire sale.''
  So what this family is saying is that they will sell part of the 
ranch now. They are going to sell part of the ranch, a third of the 
ranch right now, and by doing that what they hope to do is to be able 
to pay the Government enough money upon the death of their mother that 
they do not have to go through a fire sale on the rest of the ranch. 
They are still going to have to sell the rest of the ranch; but if they 
sell a third of it right now, then they do not have to go to a quick 
sale on the remaining two-thirds.
  ``The same scenario is happening to many of our ranchers in the 
valley. Eighty percent of the ranches have been owned by the same 
families one, two, and three generations.
  ``The value of the land has risen dramatically in the last 5 years. 
All of these ranchers live on very modest incomes and most of them can 
barely educate their children. I am certain that none of them will be 
able to pay this tax. The town is almost solely supported by the 
ranchers who buy feed, gas, food and clothing. The community will not 
be able to survive without them.
  ``What is happening is that these ranches are being bought by wealthy 
absentee owners who do not run cattle and who fly in once or twice a 
year to

[[Page 15917]]

enjoy the amenities of the ranch. This has already happened to two 
neighboring ranches, both of those owners, both second generation 
ranchers were killed, unfortunately, in accidents. Their families could 
not pay the death tax and had to sell the ranches to wealthy Southern 
Californians.
  ``I have heard it said that the death tax exists to redistribute 
wealth; to take from the rich, presumably to benefit others less 
fortunate. Let me tell you, from where I stand now, that is a tax that 
accomplishes exactly the opposite. For my family, the tax means we will 
not be able to continue running the ranch that has been our heritage 
for over 60 years.
  ``The Congress says it is a pro-family Congress. However, I know from 
my personal experience that the death tax is antifamily. The death tax 
will force us to sell our ranch to a wealthy absentee owner who is 
unlikely to run cattle or keep the workers employed or contribute to 
the community. Surely if Congress does not provide relief from the 
death tax, many other families across this country will suffer a 
similar fate. Ultimately, I wonder whether towns like our small town, 
as we know it today, will continue to exist.
  ``I urge you to ask yourself why does this death tax exist? Is it 
worth the great harm it has caused to my family and to many others like 
us? If it is not worth the harm, then the death tax shouldn't exist, 
and I hope you will do everything in your power to eliminate the death 
tax.''
  What more can I say? This is a letter sent to our office. This is 
from their heart. This is not something some big fancy lobbying 
organization in Washington, D.C., sent to me. It was not sent to me by 
the Rockefellers or the Kennedys or the Mellons or the Gateses, or any 
of those kind of people. This letter was sent to our office by a small 
family not to make money on the ranching, simply trying to pass their 
ranch from one generation to the other, to pass the heritage from one 
generation to the other; simply to keep the money for their ranching 
and their ranching community alive in their small community.
  And by the way, for those of my colleagues who voted no on the death 
tax, voted to keep it in place, in fact supported the President's 
budget to increase the death tax, if only they could take the time to 
really, really see, to go out and visit this family, my guess would be 
that those same individuals, those who voted to support the death tax, 
who stand in favor of the death tax, and who want to increase the death 
tax, after having taken the time to go out and visit with this family, 
I think they would come back a new man or a new woman; and I think they 
would be prepared to get rid of that death tax.

                              {time}  1930

  Now let me go on to the next subject because it is somewhat related.
  Once again, here it is the Federal Government, the taxing entity of 
the United States, has decided that not only death is a taxable event, 
it is the Government that decided some time ago, and let us call it as 
it is, Democrats, it happened when you had it here for 40 years, it was 
determined during that period of time that marriage, being married, 
should be a taxable event.
  Now, let me say at the onset, we had a vote on this, we had a couple 
votes on this; and I can say with a great deal of confidence with the 
Democrats here on the House floor, that 48 of the Democrats voted to 
get rid of that marriage tax. In fact, the President of the United 
States, standing right here in his State of the Union address, said we 
needed to get rid of the estate tax.
  I have got an editorial here from the Grand Junction Daily Sentinel, 
an excellent newspaper, western Colorado, Grand Junction, Colorado. It 
was just last January that President Clinton, as a part of his State of 
the Union address urged Congress, urged all of us sitting down here 
listening to the speech being made right there, urged us to enact 
legislation to end the so-called marriage penalty.
  What a reversal. Now the President's policy is he is going to veto 
it. And some people on this floor support that position.
  I hope you have enough guts when you go back to your district to 
stand up to your constituents and look them in the eye and try and 
justify that. Number one, tell them how you voted, that you voted to 
support the marriage penalty, and do not give them some flimsy, run-
around excuse for it. It was a straight up-or-down vote, do you support 
taxing marriages or do you not support it? If you support the marriage 
penalty, then you voted no on this bill to get rid of it and you ought 
to stand up.
  I hope your constituents understand that it is a straight up-or-down 
vote. There were no side issues involved here. What we are sending down 
to the administration, to the President and the Vice President, we hope 
they sign but they have already promised to veto despite the fact the 
President stood up here and gave his State of the Union address and 
said we ought to get rid of the marriage penalty. So you talk about it 
on one end and then you end it on the other with a veto.
  How can a country who is proud of the family foundation, who boasts 
to the rest of the world that our country has become the strongest 
country in the history of the world, in a large part due to the fact 
that we have strong families, that we encourage marriage, how can we 
look at other countries and say, by the way, this is the country in the 
world where we penalize you if you are married, we tax you, it is a 
taxable event, come to the United States and get married and it is 
taxable, the event is a taxable event, just like the death? How do you 
justify any one of those?
  Both of those taxes. The marriage penalty, do you think that 
encourages our young people, the hope of our country, do you think it 
encourages them to get married? And how much of that money, by the way, 
for those of you who support taxing marriage, how much of that money do 
you think could have gone into these young people's education?
  There are a lot of young married couples out there that like to have 
that extra $1,400 to pay for their college tuition or to go out and 
further their education. And some of you stand up and talk about how 
you advocate and you are pro-education, and by the way I have never 
found anybody that is anti-education, but you stand up and advocate how 
you are pro-education, but then you turn around and vote for a tax, a 
marriage penalty, that takes $1,400 away primarily from these young 
couples who are the very ones who need that money to further their 
education.
  How can you justify it? How can you look at your constituents and say 
that you can justify taxing a married couple simply because of the fact 
that they are married?
  And again, my colleagues, when you go out there into your districts, 
do not give any cock-and-bull story about why getting rid of the 
marriage penalty would cause this or cause that or as I heard the news 
report Saturday that the President said getting rid of the death tax 
and getting rid of the marriage penalty would put the surplus at risk.
  What a bunch of hogwash. It is not going to put the surplus at risk, 
not at all. The question here is fundamental fairness. That is what you 
ought to look at. Is it fundamentally fair to consider death a taxable 
event? Is it fundamentally fair to go out there and consider a marriage 
a taxable event?
  This Government is not in such dire straits that it has to go out and 
tax its own citizens when they die. This Government is not in such dire 
straits that it needs to go out to our young people and show up with a 
wedding gift of a tax bill.
  And even if this country was in dire straits economically, can you 
justify the marriage penalty, can you justify the death tax based on 
that event? Of course you cannot. Of course you cannot.
  Mr. Speaker, let me move from the death tax and from the marriage 
penalty. But before I do, let me point out one thing. Remember, the 
President stood up here, as I said earlier in my comments, he stood up 
here when he gave the State of the Union address and urged all of us to 
get rid of the

[[Page 15918]]

marriage penalty. Let us see if he stands by his words this week and 
signs the bill, or let us see if he turns around and vetoes the bill.
  The last I heard coming from the White House was they wanted to do a 
little bargain, a little tit for tat. Hey, give us this program and 
maybe we will give you the marriage tax penalty.
  Quit the horse play. The marriage penalty is not justified. To many 
of us on the floor, we make a hundred and some thousand bucks a year. 
The marriage penalty, you can absorb it. Maybe it is not a big bother 
to you. But you ought to take a look at our kids. My kids are that age 
where they are of the age where they are getting married and things 
like that. Ask yourself, look at what kind of punishment it is on them.
  So we will see this week. We will see if the President sticks by his 
words, his policy. His policy was to get rid of the marriage penalty.
  Oh, how interesting it is a couple 3 or 4 months before a national 
election. Now we are going to see him veto it. I hope we all keep that 
in mind when we go back to our constituents and say somehow Washington, 
D.C. is able to justify death and marriage, both of them, as taxable 
events.
  Well, while we are on the discussion that involves our younger 
generation, a generation, by the way, that has so many things going on 
for it. My gosh, the young people that come into my office. The 
excitement they have, the energy. As many of my colleagues know, they 
run circles around us they are so bright. They are capable, the 
computer world, that generation that follows us and the generation that 
follows that generation, these generations have a whole lot more going 
for them than they do going against them.
  And we, I think, my colleagues serving on this House floor, I think 
we have a fiduciary responsibility to that generation and the 
generation behind that generation and all future generations to get the 
programs that this Government has in place in as good a shape as we can 
get them in.
  Frankly, that is what I like about the Governor of Texas', George W. 
Bush, position on education. Every time I have talked to him, and I 
have talked to him on a number of different occasions, I cannot 
remember one conversation of any length that I have had with George W. 
Bush where he has not brought up education.
  Why? Because the best thing we can do for this next generation is to 
make sure that we have an education system that works, that we have a 
health care system that works. And there is one other factor out there 
that we have got to do some work on. We have got to make sure that our 
Social Security system is in place.
  And you know what? In those conversations that I have had with George 
W. Bush, that was in the conversation: Healthcare, education, and 
Social Security.
  Now, look, our Social Security system from a cash basis, that means 
money in the bank today, is not in trouble. Social Security is not in 
trouble today on a cash basis, but on an actuarial basis.
  In other words, Social Security today has this amount of money 
required for claims and it has this amount of money in the bank. But 
what happens over the next 30 years is these lines begin to intersect. 
So on a cash basis today, we have money in the bank, there is a surplus 
in there. It is a surplus.
  But what happens is that as this begins to go out is that when you 
reach this point, you owe all of this money, and this actually, and 
then all of a sudden it goes up like that. And not even a slight 
increase. It is almost like a rocket. It goes up just like that.
  Those are our obligations. And these obligations right here are not 
obligations 30 years out. It is actually 30 years out or so before they 
collect them. But the obligations had been incurred today. In other 
words, we owe the money today.
  So when we look at the Social Security system, we should not look at 
the money we have in the bank today. That is one factor to look at the 
money we have in the bank today. But we also need to look at what 
obligations we have.
  It is kind of like deciding when you get your paycheck on the first 
of the month, I am a rich person, you know, I have got a $2,000 or I 
have got a $1,500 paycheck here. Well, you cannot just look at how much 
you have in your hand. You have got to take a look at how much you owe. 
And when you take a look at Social Security on an actuarial basis, it 
is bankrupt. Today it is not. But 30 years from now when we pay what we 
owe, it is bankrupt.
  Now, what is giving me some confidence about the debate that we have 
had on Social Security, what gave me the confidence when I talked to 
George W. Bush was the fact that we are for the first time in a long 
time looking out ahead. We do have some time if we really take it 
seriously.
  What I liked about the Bush approach was that they are willing to 
take some risks. We have got to take some risks. We cannot let the 
Social Security system stay on status quo. If we stay with status quo, 
we are all going to be happy until that point right there. That is what 
status quo buys us. It buys us a plane in the air without a propeller 
at that point right there.
  Now is the time to start thinking about how do we get this line, how 
do we adapt for this so that we come close so we still bring those two 
lines together but we do not have the obligations way exceeding it. 
What do we do?
  Well, I think in order to figure out what we do, we have got to 
figure out historically what was gone wrong with the fund, where have 
we run into problems with Social Security.
  Well, there are a couple key factors to keep in mind. Number one, 
when Social Security was first created, when Social Security first came 
about, there were 43 workers for every retired person. So for every one 
person that was retiring on Social Security we had 43 workers 
supporting the system. That is when Social Security first came into 
place.
  Today do you know what that number is? Today we have three workers 
for every person, three workers in our working system for every person 
on retirement.

                              {time}  1945

  That is a dramatic difference and that is a significant problem that 
has led us to the actuarial problem we have in Social Security.
  What is the other problem that we have in Social Security? That one 
is actually pretty, hey, good news. It is our health care system in 
this country. When Social Security was first created, a man could 
expect to live to be 61 years old. But throughout time because of the 
advancements of Social Security, and this is good news for us, but 
because of the advances in Social Security, that man now can expect to 
live to be 73 years old. For the female, those numbers were 65, and now 
they are somewhere around 78 approximately. Those are good numbers.
  But the problem is that we now have more people on the Social 
Security system, we have less workers supporting the Social Security 
system, and we have people living to a longer age. The couple that is 
drawing from Social Security today draws out about $118,000 more than 
they put into the system because of these factors. They are taking out 
$118,000 more than they put in. A system cannot operate like that. We 
have got to make some adjustments.
  What kind of adjustments do we make and who is going to be impacted? 
The plan that Governor Bush of Texas has put out and the plan that I am 
advocating tonight, not because of the fact that I am absolutely 
convinced that there is only one plan out there, but it is because of 
the fact that I have looked at a number of different options; and I 
think the one that is the best is one that has some experience, and the 
one that has some experience is the one that the governor of Texas has 
proposed we adopt in these halls of Congress.
  Why does it have some experience? Because we Members of Congress have 
our own retirement plan. We are on Social Security, by the way. But we 
have our own retirement plan here in Congress which allows us choice, 
not allowed under Social Security.

[[Page 15919]]

  So what we need to do when we look at Social Security is, first of 
all, any kind of proposal, and the proposal put out by the governor of 
the State of Texas has one fundamental rule at the very beginning and 
that is, those who are currently on Social Security, so our current 
recipients, face no risk. Anybody on Social Security today does not 
have any threat to their Social Security retirement funds that they are 
receiving. That is fundamental and they are not at risk in any sense. 
So during this political season, do not let your constituents be 
hoodwinked into thinking that their Social Security pension that they 
are drawing today is at risk. It is not. What we are talking about is 
what can we do for the future generation? What can we do for my 
children and my children's children to help assure that when they get 
there, Social Security will be alive and well?
  What the proposal is that has been put forth by the governor, I guess 
really the best way to do it, let me explain what happens if you are a 
Member of Congress or if you are a government employee, so it is not 
just Congress, it is Federal employees, so there are over 2 million 
Federal employees in this country, over 2 million. Here is the plan 
they have in effect. First of all, they do pay Social Security.
  But here is the Government plan, the U.S. Government plan for its own 
people. It is called the Thrift Savings Plan. It really works in two 
ways. It has two sections to it. The first section we will call section 
A pulls an amount of money out of your paycheck every month and you 
have no say-so about where that is invested. It is the safety net. It 
is your safety net. So this amount of money is pulled out. You have no 
say-so; but as a result of that, after, say, so many years of service 
and a certain age, you are guaranteed a certain retirement check every 
month. No risk, not much return, but no risk.
  Now, by the way, if you want to consider return, figure out that 
Social Security, if you were born, for example, in 1960, so that would 
make you 41 today, 40 years old, if you were 40 years old, your return 
on the current system, if we do not do anything with Social Security, 
your return is less than 1 percent. 1 percent. Less than 1 percent. 
That is what you are making on Social Security. We can do better. And 
the Government knows it can do better because it does it on its own 
program.
  So the first part of the Government retirement program which covers 
all government employees has this pullout; it is an automatic pullout 
out of your check. It is for your retirement. I forget exactly what 
mine is every month. I have no choice. That is the safety net. The 
second section is what we call, we will just call it section B. That is 
not the formal name; but for our discussion tonight, B. What that 
allows you to do is it is optional. You do not have to do it. If you as 
a government employee do not want to participate in the second portion, 
you do not have to. But if you want to, you can designate, not all your 
retirement money but you can designate up to 10 percent. You can 
designate up to 10 percent of your salary every month to go into that 
retirement section.
  What that allows you to do is it gives you three choices. The three 
choices really are an opportunity for you as an individual to invest 
your retirement money, to help plan for your own retirement. It gives 
you choice. Social Security today gives you no choice. It mandates you 
live with the 1 percent return. It mandates that. But this program 
here, the Government program for its own employees allows you, if you 
want to, totally optional, to participate in this program of choice.
  What does it do? You contribute up to 10 percent of your check; then 
I think the Government matches the first 5 percent, then you get to 
make a choice. You can have that money invested in government savings 
where it is insured, it is guaranteed and, of course, when you have a 
guaranteed return with minimal risk, you are going to have a low 
return. The history of that shows that pays 3, 4 percent a year. The 
second option you have is you can go into the bond market. The third 
option you can go into is your highest risk, which offers your highest 
returns, but again has its highest risk and it is the stock market. But 
even if you took the stock market choice and you lost everything, you 
still had the safety net up here. That is how the Government program 
for 2.5 million people works.
  By the way, I want you to know that the strongest opposition to 
George Bush's plan to bring out this Social Security, to help it for 
this next generation, the strongest opposition, of course, comes from 
the administration. But I can tell you that the Vice President voted 
for this government program many years ago when he was in Congress. So 
what is good enough for the goose ought to be good enough for the 
gander. If it is good enough for government employees, why is it not 
good enough for the citizens of America who want to participate in 
Social Security?
  What the administration has advocated is to take the status quo. 
Look, we have got 30 years before this next generation gets up there 
and is going to make a call on the bank. So let's just ride the status 
quo, or let's have another committee, to study another committee for 
another committee study. That is not good enough. We have got to take 
some risk.
  Some of you in here, you do not like risk; and I understand that. But 
I want you to know that the people who are currently on Social Security 
or are close to, they face no risk. We are not impairing their ability 
to draw down on Social Security the benefits that they are entitled to. 
But those of you who want to sit around and do not want to take risk, 
you better be prepared for this next generation to explain to them why 
frankly you sat on your duff and did not do anything to save this 
system.
  We have got to have some leadership in Social Security. Somebody has 
got to take the ship out into the storm. The easiest thing to do is to 
dock your ship in the harbor and get out of it and get onto the land. 
But somebody has got to get through to the other side. That is exactly 
why I was pleased when I saw and sat down, was able actually to discuss 
only briefly, but discuss the governor of Texas' plan and a plan that 
most of us on the Republican side and I think frankly a lot of 
Democrats would support.
  This is what the plan does. First of all, it is optional. You are not 
going to be required to do this, to participate in the choice aspect. 
Second of all, it has a safety net, so no matter what you want to do, 
there is going to be the majority of the money taken out of your 
paycheck for Social Security. The majority of it will be put into an 
account that you do not have any say over it. In other words, we do not 
want you losing that. We want to have a safety net, because not 
everybody is going to make money. Certainly on an average over a period 
of time, you are going to make a lot better than 1 percent, but some 
people may make bad decisions. It has been known to happen. Some people 
make bad decisions. We do not want 30 years out from now somebody 
saying, Look, I made bad decisions. I by choice invested all my money 
in really high-risk stuff and I lost. I thought I was going to win. I 
lost. Even for that person, we want to have at least a minimal safety 
net. That is what we do right here.
  The second part is for those of you who want to under the Social 
Security system, just like the government thrift savings program, you 
are going to be allowed to take 2 percent of the money taken out for 
Social Security and you get to direct it, you get to choose how that 
money will be invested. We would run that program. The proposal for 
that program, to revise Social Security, so that this next generation, 
that our young people have something that they know is rock solid. What 
this allows you to do is to do the same as 2.5 million other government 
employees get to do, and, that is, with that 2 percent, you could 
invest it in a low risk. Low risk, of course, means low return. Or you 
could invest it in moderate risk, which means possibility of a moderate 
return. Or you can invest it in high risk, which means the possibility 
of high return. Of course high risk means that. High risk. You could 
lose it all. Moderate, you could lose it. This lower one, the first 
one, you would be guaranteed a return on your savings.

[[Page 15920]]

  Now, what is wrong with that? Why is the administration opposing it? 
We, by the way, have a lot of Democrats, obviously from my comments I 
am a Republican, but we have a lot of Democrats who say this is a good 
idea. When you get beyond the Potomac out here, when you get out into 
the rest of America, you find out there are a lot of people out there 
that are not as partisan as you think. A lot of people out there would 
join together and say, Look, we have got to do something with Social 
Security.
  I think most people in America, especially the younger generation, by 
the way, who are investing the maximum amount of money right now with 
the lowest possibility of return because of the pulling out of the 
funds, I think you would find that younger generation saying, hey, 
something has got to happen with the management. We need to take some 
different course with Social Security, because frankly, the young 
people are saying, we are paying into this system, why should we not be 
entitled to expect some kind of return out of the system?
  Outside of Washington, D.C., people want Social Security to work. 
People do not want Washington, D.C., to bog down Social Security. They 
want a program that will move forward. Now, I know that the governor of 
Texas has come under some criticism because he has been bold enough to 
go out and say we have got to take this ship on a different course. And 
sure it looks like there is a storm ahead, but the only way we are 
going to get to the other side is we have got to sail. And somebody has 
got to have enough courage to stand up there and say, Look, let's try 
moving the ship. Not dramatically, not radically. We are not going 
through the eye of the storm to get torn up.
  Under proper guidance and leadership, we can take this ship on a safe 
voyage. And when we get to the other end, this generation behind us and 
two generations behind us and the other generations that follow will 
have a Social Security system that the first thing you talk about is 
not how quickly it is going to fail. The first thing you should be able 
to talk about on Social Security is, it is a system that works. It is a 
system that works. And it allows you to have the choice.
  Think about it. If you are confident today and for those of you who 
are standing and are opposed to any kind of change in Social Security, 
for those of you who are supporting the administration's policy, go out 
beyond the Potomac River and ask constituents of yours out there, If 
you've got a million dollars and you want to invest it, would you send 
it to the Social Security Administration or would you send it to the 
United States Congress to invest it on your behalf? Of course they are 
not going to say that. They have confidence that they can invest it 
better than we can back here in Washington, D.C.
  Considering that the return for somebody born in 1960 is going to be 
less than 1 percent on their dollar in Social Security, I think they 
are right. I have got a lot more confidence in this younger generation 
than some of you might. I think they know, and I think they can wisely 
make decisions with a very small percentage of those Social Security 
payments. Remember, the people that are in the Social Security system, 
we are not allowing them to invest everything. We are not going to 
allow somebody to go in there and say, I want to take all my Social 
Security and put 100 percent of it in the stock market. We are taking 
98 percent of it and saying, You don't have any choice on it. That is 
your safety net.

                              {time}  2000

  That no matter how bad a decision you make, you still are going to 
have a payment available to you for those of us born in 1960 in another 
15 years or 20 years, but we are going to do something different. Some 
would call it a dramatic course of action.
  I do not think it is dramatic in its results. I think it is dramatic, 
and it is finally about time that somebody stood at the helm of the 
ship and said let us change the course.
  What we are doing is we are allowing them to take just a small 
percentage, that younger generation, and let us give them a little 
confidence for their capabilities of making decisions and saying to the 
younger generation we are going to allow you a choice. You get to help 
in that investment; it is, after all, your dollar. Many people in 
Washington D.C., get the idea that it is the money of the Government 
back here.
  It is not the money of the Government. It is the money of the people, 
and they have sent it to us on a trustee basis, and I do not think it 
is so wrong to ask them to help join us in the decisions that should be 
made on the investments of their dollars. And that is what that Social 
Security plan calls for. That is why I hope when we reconvene with a 
new President in January of next year that on that agenda we have three 
items of which I consider very important: one, an opportunity to take 
Social Security and allow the people more input and allow the younger 
people of this country an opportunity to voice their decision and help 
make decisions on their own personal investments in that Social 
Security system. We can save Social Security. It does not need to be 
bankrupt in 30 years.
  The second thing I hope we see when we have a new President in 
January, because I am afraid unfortunately that the President we have 
today is going to veto it, and that is elimination of the penalty for 
being married. As I said earlier, how can we possibly justify marriage 
as a taxable event? This President does. It is his policy.
  The third thing I hope we have when we have a new President in 
January is the elimination of that death tax. Like with the marriage 
tax, how can we justify taxing somebody simply based on the fact that 
they died? What kind of government is this? Is this a socialistic type 
of government?
  What does it do to the local communities? What does it do to the 
family farms and ranches? What does it do to the small contractor. 
Remember, a backhoe, a dump truck, and a bulldozer and you are in that 
bracket.
  Mr. Speaker, I am in hopes in January we have a President that will 
do those three things: guide us with Social Security, give us some bold 
strong leadership, as the governor of Texas has suggested; number two, 
get rid of that marriage penalty. Let us do what we say we are doing. 
Let us really encourage our young people to get married. Let us 
encourage our young people to have a foundation of family without 
worrying about being taxed for it. Third of all, let us give the next 
generation on the family farm or the family ranch and the local farming 
community, let us give them an opportunity to keep those resources in 
the family, in the community, instead of penalizing the family, 
penalizing the community, in spending that money right out of there 
straight to Washington, D.C.
  I am confident, colleagues, that we have a very positive future ahead 
of this country. I could not be more excited about the future of the 
United States of America. I could not be more excited about our young 
people, and that is why we have to keep education as a priority; that 
is why we have to look at these factors that I have discussed tonight.
  We cannot continue on a positive course and improve it if we do not 
put a lot of effort into it. It is not going to come free, and it is 
not going to happen when we penalize marriage. It is not going to 
happen when we penalize death, when we call it a taxable event. It is 
not going to happen when we look at this next generation and say to 
them, well, to Social Security, here is your bankrupt system that you 
helped pay for. We can change all of that.
  I hope my colleagues join with myself and our new President in 
January to make those kinds of changes, because that is what this 
country is all about, making a difference. And we, colleagues, can make 
that difference, and the people of our country deserve it.

                          ____________________