[Congressional Record (Bound Edition), Volume 151 (2005), Part 20]
[House]
[Pages 27770-27811]
[From the U.S. Government Publishing Office, www.gpo.gov]




            TAX RELIEF EXTENSION RECONCILIATION ACT OF 2005

  Mr. PUTNAM. Mr. Speaker, by direction of the Committee on Rules, I 
call up House Resolution 588 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 588

       Resolved, That upon the adoption of this resolution it 
     shall be in order without intervention of any point of order 
     to consider in the House the bill (H.R. 4297) to provide for 
     reconciliation pursuant to section 201(b) of the concurrent 
     resolution on the budget for

[[Page 27771]]

     fiscal year 2006. The bill shall be considered as read. The 
     amendment in the nature of a substitute recommended by the 
     Committee on Ways and Means now printed in the bill shall be 
     considered as adopted. The previous question shall be 
     considered as ordered on the bill, as amended, to final 
     passage without intervening motion except: (1) one hour of 
     debate on the bill, as amended, equally divided and 
     controlled by the chairman and ranking minority member of the 
     Committee on Ways and Means; (2) the amendment in the nature 
     of a substitute printed in the report of the Committee on 
     Rules accompanying this resolution, if offered by 
     Representative Rangel of New York or his designee, which 
     shall be in order without intervention of any point of order, 
     shall be considered as read, and shall be separately 
     debatable for one hour equally divided and controlled by the 
     proponent and an opponent; and (3) one motion to recommit 
     with or without instructions.

                              {time}  1030

  The SPEAKER pro tempore (Mr. LaHood). The gentleman from Florida (Mr. 
Putnam) is recognized for 1 hour.
  Mr. PUTNAM. Mr. Speaker, for the purpose of debate only, I yield the 
customary 30 minutes to the gentlewoman from Rochester, New York (Ms. 
Slaughter), pending which I yield myself such time as I may consume. 
During consideration of this resolution, all time yielded is for the 
purpose of debate only.
  Mr. Speaker, in April Congress passed a responsible budget that 
called for spending restraint, reduction of the deficit; and by slowing 
the unsustain-
able and automatic growth of mandatory spending programs and extending 
tax relief to families and small businesses, we have successfully 
accomplished the first two. Now, this rule will provide for 
consideration of our final commitment to American taxpayers, extending 
numerous important tax relief provisions.
  In 2001, 2003 and 2004, Congress enacted responsible tax relief to 
help create new jobs, grow America's economy, and put more money in the 
hands of workers, families, small businesses, farms, and ranches. 
Following this tax relief, unemployment dropped a full percentage point 
to 5 percent, and we have experienced 10 uninterrupted quarters of real 
growth in our economy, above 3 percent, the longest stretch since the 
1980s. As was proven by the tax cuts during the Kennedy and Reagan 
administrations, Federal revenues actually increase after taxes are 
lowered.
  Our expanding economy is led by consumer spending, job growth, and 
business investment. This is a result of allowing workers to keep more 
of their hard-earned money, decreasing the tax burden on small 
businesses so they can expand and hire more workers, and providing 
incentives for families to save and invest.
  Unless we take action today, many of the important tax provisions 
that have helped our economy grow strong will expire. Without passage 
of this legislation, workers, families, and small businesses will have 
less of their paycheck to take home each week.
  Mr. Speaker, H.R. 4297, the Tax Relief Extension Reconciliation Act, 
not the most eloquent of names but an important one, will continue to 
build on the economic progress we have already made.
  A key part of the American Jobs Creation Act of 2004 was a return to 
fairness for those who live, work, and raise families in States with no 
State income tax. The State and local sales tax deduction is 
particularly important to those in my home State of Florida and nine 
other States because it gives every taxpayer the opportunity to deduct 
State sales tax from his Federal tax bill, something that other higher-
tax States have enjoyed for some time. This provision is set to expire 
in 3 weeks. While I will continue to work to make the State and local 
sales tax deduction permanent, this bill extends the provision for an 
additional year, which is an important step forward for fairness.
  The bill also extends several tax incentives to enhance the 
affordability of higher education, including tax-deferred education 
savings accounts and tax credits for post-secondary education. It 
allows all taxpayers to deduct up to $4,000 of higher education 
expenses, which will help more students go to college.
  For teachers, the tax bill extends an important above-the-line 
deduction to help them contain the costs of out-of-pocket classroom 
expenses such as books, supplies, and computer equipment. We all know 
that our hardworking educators are covering for some of our neediest 
students, and this bill lets them keep the tax deductibility of their 
generosity.
  In an effort to encourage savings and stable retirement security, 
this tax bill allows lower-income families that contribute to 
individual retirement accounts and pension plans to continue receiving 
a Federal match in the form of an income tax credit for the first 
$2,000 of annual contributions. This encourages families to save and 
plan for their own retirement. While we were unable as a body to settle 
on a Social Security reform plan, surely we can all agree that 
encouraging low-income families to save for retirement and giving them 
the tools to do so is a sound economic policy.
  Our bill freezes the rate on capital gains and dividends and prevents 
an increase of the tax burden on 24 million families. It is imperative 
that we extend this tax relief so our economy will continue on its 
upward track.
  New data released at the start of December show that our economy 
continues to strengthen and grow. The Labor Department reported that 
employers added 215,000 jobs in November, after adding 44,000 in 
October and 17,000 in September in the wake of devastating hurricanes.
  The jobless rate remains unchanged at 5 percent. The economy grew at 
an annual rate of 4.3 percent in the third quarter, much stronger than 
expected.
  Forecasters' outlooks for coming months are upbeat as well. 
November's increase in payroll, the largest since July, was broad-
based. Construction employment rose by 37,000. Employment in 
professional and technical services rose by 22,000. Health care 
employment rose by 20,000 jobs. Manufacturers added 11,000 jobs last 
month following an increase of 15,000 in October.
  The most recent Commerce Department report shows overall consumer 
spending increased at a 4.2 percent annual rate, exceeding 
expectations. Purchases of nondurable goods surged 3.6 percent, 
exceeding expectations. Housing spending came in at 8.4 percent. 
Business investment spending rose at 8.8 percent, exceeding 
expectations.
  Obviously, the current tax policy of this Congress has encouraged 
economic growth, and to raise taxes now would close the door of 
opportunity that is open for so many today.
  Mr. Speaker, this rule provides for consideration of a substitute 
bill. While we often hear Democrats decry tax relief, they have decided 
to offer a substitute that extends many of the same tax provisions as 
this underlying bill does, but let us look at who they left out.
  The Democratic substitute does not extend an income tax credit for 
low-income families who contribute to individual retirement accounts, 
IRAs, and pension plans. This hurts low-income families who are 
struggling to save for retirement, people who are doing the right 
things to prepare for their future rather than solely depending on the 
government to do it for them.
  The Democratic substitute does not extend enhanced small business 
depreciation expensing, so it increases taxes on small businesses, the 
very engines of innovation and growth and employment in this country.
  The Democratic substitute does not include an extension of the 
reduced rates on capital gains and dividends. Without this extension, 
24 million families will see a tax increase, including 7 million 
seniors who have benefited an average of $1,200 annually from that 
change. At a time when concern is growing about foreign investment in 
the United States, the Democratic substitute throws up barriers to 
Americans investing in America.
  The Democratic substitute does include a tax increase on families and 
small businesses to pay for the bill. Many of these individuals are 
small businesses who do much of the hiring and buying in this economy.
  The Democratic substitute bill leaves behind small businesses, omits 
low-income savers, and hurts families and

[[Page 27772]]

seniors. At a time when home heating bills are rising and local 
property taxes are growing, why would the Democratic substitute take 
even more from the wallets and purses and piggy banks of the American 
taxpayer?
  Mr. Speaker, the Republican tax reforms of 2001, 2003 and 2004 have 
created jobs, strengthened our economy, and increased Federal revenues 
in the process. They quantifiably aided in shortening and curtailing 
the severity of the recession of 2000 and 2001. They buoyed the economy 
through major terrorist attacks, devastating natural disasters, and a 
global war on terrorism. Now is not the time to increase taxes on the 
American people. Failure to pass this bill would result in higher taxes 
on seniors, savers, small businesses, and farmers. We must continue the 
policies that grow our economy and keep our tax bills from rising.
  I urge my colleagues to support this resolution and the underlying 
bill, the Tax Relief Extension Reconciliation Act.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, just 2 weeks ago, the majority forced a budget vote by 
two votes to cut $50 billion from education, from health care, from 
foster care, child support, and a host of other vital programs. They 
claimed that they were simply eliminating waste and promoting fiscal 
responsibility and, most importantly, curbing our national debt.
  But today, they want us to agree to a tax cut for $56 billion. If we 
take away the $50 billion in the budget tax cuts, but we add $56 
billion in tax giveaways, we end up with more debt, not less. In fact, 
we end up adding $6 billion to the largest deficit in our country's 
history, the one created by this Republican Congress.
  Now, if reducing the deficit is not a priority, what has made the 
majority's agenda? How we control the purse strings in our hands 
reveals who we work for. Of the proposed $56 billion in cuts, 50 
percent, that is, $28 billion, will go to the superrich, those among us 
who need it the least. This bill is for them, the men and women among 
us who earn more than $1 million a year, a mere fraction of 1 percent 
of Americans.
  At the same time, the middle class will continue to be squeezed, 
while workers who make $40,000 or less, in other words, those who need 
help the most, will receive 1 percent of today's cuts.
  That is what this is about. Does the Republican Party really think 
the American people do not see what is going on here?
  What this bill shows us today is that Republicans care about 
entrenching privilege, the work of a corrupt and inefficient 
government, all while talking about tough choices and cutting 
government waste; but their rhetoric does not add up.
  If they were serious about making government work better, they would 
fulfill their responsibility to conduct proper congressional oversight 
and ensure that the money we do spend is spent efficiently.
  They would look for the $9 billion misplaced during Iraq 
reconstruction, and we have tried time and time again to have 
amendments approved that would do just that. Now, the loss of $9 
billion in Iraq is what I call government waste, but there is not a 
court in this country which could find Republicans guilty of enforcing 
accountability in government. There would not be the evidence to 
convict them. Instead, they cut social services for the needy and send 
the savings to the rich.
  Have tax cuts for the rich become the sole agenda of the majority 
party? Sadly, in the face of numerous challenges from both abroad and 
home, this increasingly seems to be the case.
  Their solution to rehabilitating the lives of those devastated by 
natural disasters? Cut taxes for the rich. Their solution to curbing an 
out-of-control national debt? Cut taxes for the rich.
  My friends on the other side of the aisle talk about the agenda of 
reform, but they have controlled the Congress for over 10 years, and 
now they are the status quo. As much as they may want to say they are 
the solution, we know that they have become the problem.
  If they were committed to solutions, they would not funnel money to 
the rich while they leave the working middle class to fend for 
themselves, all while cutting education and health care programs and 
adding billions to the massive debt that is crushing this Nation. Let 
me point out that the 400,000 persons who lost their food stamps in the 
budget cuts and over 300,000 children who lost their breakfast 
programs, that money is being used today to finance these tax cuts.
  The pursuit of such an agenda violates the trust our constituents 
have invested in their elected representatives, and it is an abdication 
of the most fundamental responsibilities of this Congress.
  America can be better than this. We can do better than selling out 
the vast majority of our citizens so that Congress can give another tax 
cut to a tiny minority. We can do better than increasing our staggering 
national debt and calling it fiscal responsibility.
  This leadership has forgotten what made America great. It has 
forgotten what made the 20th century the American century, which was 
investment in the middle class, investment in society, investment in 
education, investment in opportunity, investment in the future, not 
investment in the rich.
  It is time for a new direction. Together, America can do better than 
what this leadership is proposing here today.
  I urge my colleagues to defeat this bill and defeat this rule.
  Mr. Speaker, I reserve the balance of my time.
  Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the gentleman from 
Georgia (Mr. Gingrey).
  Mr. GINGREY. Mr. Speaker, I would like to thank my friend and 
colleague on the Rules Committee for allowing me this opportunity to 
speak on behalf of this rule and the underlying bill, H.R. 4297, the 
Tax Relief Extension Reconciliation Act.
  Today, each and every Member of this House is taking a test before 
the American people. This test has one question, and simply enough, it 
is even multiple choice. The question is: Who do you trust more to 
spend your hard-earned money? Is it, A, the Federal Government and its 
bloated bureaucracy; or is it, B, the American people? Well, Mr. 
Speaker, the correct answer, obviously, is, B, the American people.

                              {time}  1045

  However, those who vote against this rule and vote against this tax 
relief bill are choosing to trust the Federal Government and its 
bloated bureaucracy over the people who pay the taxes and are the 
engine of a job-creating economy.
  Now, Mr. Speaker, the opponents of this tax relief will try to 
obscure and confuse this debate by mischaracterizing this House's 
previous vote on budget reform and reduction with claims of, and I have 
already heard it, robbing the poor to pay the rich. Well, Mr. Speaker, 
these claims are simply untrue.
  In fact, today's reconciliation package includes extensions of tax 
incentives that provide work for many low-income Americans, such as the 
Welfare to Work Tax Credit and the Work Opportunity Tax Credit that 
encourages businesses to hire and pay people and families on public 
assistance, high-risk youths, qualified veterans, and people who 
receive food stamps.
  So a vote against this tax relief package is tantamount to a vote for 
an economy under which it is acceptable and even preferred to give the 
poorest individuals only one option, government dependency, a 
dependency that empowers bureaucrats and politicians over people and 
places political power before economic liberty and opportunity.
  Mr. Speaker, I would also like to add that since this tax relief 
package includes mostly extensions of current tax cuts and credits, a 
vote against this bill is a vote simply to raise taxes. No ifs, ands, 
or buts, those who vote against this bill are voting in front of the 
American people to raise taxes.

[[Page 27773]]

The opponents of this bill would raise taxes on middle-income 
Americans, rich Americans, poor Americans, investors, savers, 
entrepreneurs, small business owners, universities, veterans, and even 
people who are trying to clean up the environment. All of these people 
will receive a tax increase if this bill is not passed and signed into 
law.
  So, Mr. Speaker, each and every Member of this House has an 
opportunity today to go on record and tell the American people where 
they stand on raising taxes and whether they trust the American people 
with their own money.
  In conclusion, I would like to encourage my colleagues to support 
this rule and the underlying tax relief extension package for the sake 
of economic growth and for the sake of the American taxpayer.
  Ms. SLAUGHTER. Mr. Speaker, I am pleased to yield 4 minutes to the 
gentleman from Oregon (Mr. DeFazio).
  Mr. DeFAZIO. It is extraordinary. If you assert something that is not 
true, it is true on the floor of the House. There is no truth test 
here. Cut taxes for the rich, it will stimulate the economy. Put the 
little people to work who will pay taxes for their job cutting the 
lawns or washing their yachts. That is the argument we are hearing from 
that side of the aisle. Trickle down economics works, they tell us.
  Unfortunately, that is not what most Americans find with their real 
incomes stalled out over the last 5 years. No, trickle down economics 
does one simple thing: It rewards the benefactors of the Republican 
Party.
  Let us just look at one of the elements of the ``not raising taxes 
today.'' It would be let the tax cuts in dividends on stocks. Now, I go 
to my town meetings and I say, everybody who has dividend paying 
stocks, raise your hand. And I have a lot of people coming to my town 
meetings, but usually it is one, maybe two. And I think that is pretty 
much the same across America. But the millionaires and, yeah, the 
billionaires, they have a lot of dividend paying stocks. In fact, their 
tax cuts average $127,000, while the average family averaged $800.
  Now, that is not even talking about the dividend tax. Let us talk 
about the dividend tax. This bill will extend the cut in dividend 
taxes. Now, the American Enterprise Institute, no liberal bastion 
there, they just issued a report and it says the dividend tax break has 
not generated more business investment or jobs or productive economic 
activity but it has enhanced investor wealth. That is what this is 
about. This bill is to enhance investor wealth.
  Now, they have a newfound concern about the sea of red ink they have 
created, the 60 percent increase in our debt in the last 5 years. So a 
couple of weeks ago we jammed through a bill at 2 a.m. in the morning 
that cut things like student financial aid, Medicaid, health care to 
poor people, dumping that burden on the States; foster care, long-term 
care, the school lunch program. Those little kids are just eating too 
much. They are chowing down. They are going to help the obesity problem 
on this side of the aisle by starving kids.
  Now, what are we buying with those cuts? Well, the student loan cuts, 
they say, oh, we are not cutting student loans, we are just charging 
them more for the loans. Right, you are not cutting student loans, you 
are just increasing their debt burden. You are not cutting the loans, 
you are just jacking up the interest rate, charging them twice as much 
to take out a loan, and charging them a special new fee to get a very 
high fixed interest rate, something they can get now for free at a 
lower rate.
  But they are not whacking the students too hard, only $14 billion. 
And what do we get for that $14 billion? An extension of the dividend 
tax cut. That is great. So now the wealthy will be able to buy more 
yachts to float on the sea of red ink that the Republicans have 
created. They will be able to hire more help around the mansion. That 
is trickle down economics.
  They talk about how great the economy is doing. Here is a few facts. 
Unemployment rate, yes, it is recently down, but it is up eight-tenths 
of a percent over when the Republican administration took charge. There 
is 1.6 million more unemployed workers than when George Bush took 
office. There is the slowest private sector job growth of any 
administration since Herbert Hoover. He is doing better than Herbert 
Hoover. That is great. The largest projected surpluses turned into the 
largest projected deficits, with $4.2 trillion more debt in 2008.
  Now, that is the grand success of trickle down. And they come out 
here and assert baldly that giving tax cuts to rich people will not 
only stimulate the economy, put people to work, but that it will reduce 
the deficit. Sure. You really believe that? I do not think so. The 
American people do not believe it.
  What you are doing here is giving very generous tax cuts to the 
people who give you very generous campaign contributions.
  Mr. PUTNAM. Mr. Speaker, I am pleased to yield such time as he may 
consume to the gentleman from California (Mr. Dreier), the 
distinguished chairman of the Rules Committee.
  Mr. DREIER. Mr. Speaker, I rise in strong support of this rule, and I 
thank and congratulate my great friend from Florida, such a hardworking 
member of the Rules Committee, and I thank all those involved in this 
effort, which I hope at the end of the day will be bipartisan. Because 
we all know that of that proverbial saying that everyone is entitled to 
their own opinion but not their own facts.
  As I listened to the pathetic, and that is really the only way you 
can describe it, the pathetic old class warfare, us versus them 
argument, cleaning yachts and mowing lawns and all this stuff. The 
facts are 56.9 million American families, 56.9 million American 
families, nearly 60 percent of American families are members of the 
investor class. The investor class, people who have some kind of 
investment. And, Mr. Speaker, 30 percent, 30 percent of the members of 
the investor class earn less than $50,000 a year. Now, those are the 
ultra rich we continue to hear about who might benefit from job 
creations.
  I will tell you that if you look at the arguments that were made, and 
I listened to my good friend from Rochester, Ms. Slaughter, in her 
opening statement in which she talked about investing in all these 
important things, of course we all want to invest in the future. But 
she said, do not invest in the rich. Well, the fact of the matter is we 
are encouraging investment with this because we want to do everything 
we possibly can to make sure that those people who are out there 
creating jobs have the incentive to do that.
  And we also need to look at long-term planning. People can stand up 
and malign the dividend cuts and the capital gains cuts, but I actually 
believe we should have no tax on capital gains at all. It is a double 
tax and, frankly, it discourages growth.
  I will never forget a few years ago visiting New Zealand, which is 
certainly a left of center government. The prime minister there, Prime 
Minister Clark, well, let us just say she is not what you would call 
center right. But I met with a number of people in New Zealand, and I 
raised with them the prospect of establishing a capital gains. They 
have zero capital gains there. They said that they did a study in New 
Zealand and found that the mere establishment of a capital gains tax 
would be devastating to the economy of New Zealand. And all we are 
saying is we should allow people for another couple of years to plan at 
a 15 percent capital gains rate.
  Mr. Speaker, we know, as we look at the arguments that were provided 
in 2001, 2002, 2003, that our wonderful colleagues on the other side of 
the aisle regularly said the following things: Number one, if you put 
into place these tax cuts, the economy is going to head straight into 
the tank.
  And I listened to my friend from Oregon go through the Herbert Hoover 
argument, and I thought we had sort of beaten that one back in the 2004 
campaign when in the last 3 years we have seen the creation of 4\1/2\ 
million jobs under the payroll survey guideline and 5 million jobs 
under the household survey guideline. I thought we had pretty

[[Page 27774]]

much beaten that argument back, but obviously, they are continuing to 
try and dredge this up.
  They said that if we put into place this tax cut that the economy 
would go into the tank and the deficit would go sky high. We know the 
exact opposite has been the case. We, in fact, have had a reduction of 
$94 billion in the deficit simply because of economic growth, simply 
because of the enhanced flow of revenues to come into the Federal 
Treasury.
  Now, obviously, we are not going to see probably the best improvement 
in the deficit number next year because of Hurricane Katrina and other 
costs that we have faced, and we are doing everything we can, so many 
of us, to try to rein in mandatory spending with the reconciliation 
process we have gone through, and to try to do what we can on both 
discretionary as well as mandatory, as I said. But the fact of the 
matter is, Mr. Speaker, the single most important thing that we can do 
to deal with the challenges of investing in all those things that Ms. 
Slaughter mentioned, is to make sure that the economy continues to 
grow.
  I can think of nothing, nothing worse for the potential future growth 
of our economy than to not pass this measure. So if you believe in 
bringing unemployment down even further, if you believe in seeing the 
already record level of minority home ownership go even higher, if you 
believe in enhanced productivity and incentives for that, it is 
absolutely essential that this rule and this legislation be passed.
  So I commend it to my colleagues. The tired old arguments of the past 
are not carrying any weight at all with the American people, I am happy 
to say. They get it. They understand it. So that is why we should have 
Democrats join with Republicans in doing the right thing here.
  Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from 
Georgia (Mr. Lewis).
  Mr. LEWIS of Georgia. Mr. Speaker, I want to thank the gentlewoman 
from New York for yielding me this time.
  Mr. Speaker, once again, I rise in disbelief about what the House is 
about to do today. It is my belief that we are moving down the wrong 
road.
  Before we left for Thanksgiving, the Republican leadership twisted 
arms to pass a bill slashing funding for vital programs that benefit 
the neediest Americans. Some might say that the bill was callous. I say 
that the bill was immoral. Today, it is still immoral, uncaring, and 
without compassion.
  But now, to add insult to injury, we have returned to Washington so 
that the Republican majority can line the pockets of those at the very 
top. That is right, they cut vital programs and services that benefit 
hardworking, low- and middle-income Americans, and with the money saved 
they are giving more tax cuts to the wealthiest of the wealthy. And in 
the process of robbing working families to give to the rich, we are 
ballooning the debt, saddling our children and grandchildren with the 
bill.
  Everybody loses under this bill. Everybody. That is except the top 
one-fifth of 1 percent. Some might call them the super rich; apparently 
the majority calls them donors.
  It is unbelievable. It is unbelievable that we are doing this during 
this season. The holy season. It is unreal. This season, of all 
seasons, you would think they would not have the audacity, the gall to 
pass such a disgraceful and shameful piece of legislation. Oh, but they 
do.
  Where is our compassion? All of the great religions of the world 
speak to the issue of taking care of basic human needs. During this 
season, the question must be asked: What would the great teacher do? 
What would Jesus do?
  We are saying we are people of faith, and yet during this most holy 
season we do this? Have we lost our way? How long, but oh, how long 
will we continue to take care of those at the very top and not those in 
the middle and those at the very bottom? How long, but oh, how long?
  This bill is not fair. It is not right. It is not just. As a Nation 
and as a people, as a Congress, we can do better. Mr. Speaker, I appeal 
to my colleagues to reject this shameful bill.

                              {time}  1100

  Mr. PUTNAM. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Tennessee (Mr. Duncan).
  Mr. DUNCAN. Mr. Speaker, I rise in strong support of this very modest 
tax relief proposal and the rule that brings it to the floor, and 
especially in support of the deduction for State and local sales taxes 
which is so very important to my home State of Tennessee and many 
millions of people throughout this Nation.
  Every day we read stories about how wasteful the Federal Government 
is, and certainly it has been proven over and over again how the least 
efficient, most wasteful way to spend money is to turn it over to the 
Federal Government. Every dollar we can keep in the private sector 
helps to create jobs and lower prices. And who benefits the most from 
job creation and lower prices: the poor and the lower-income and the 
working people. The wealthy are always going to be all right, but this 
is a bill that helps the poor and the lower-income and the working 
people more than anybody else.
  It contains breaks for the rich like tax deductions for teacher 
classroom expenses, expenses that classroom teachers pay out of their 
own pockets. It contains another deduction for the rich for deducting 
tuition expenses. That is certainly a deduction for the wealthy; and, 
of course, I am saying that sarcastically.
  It contains expensing for brownfield environmental cleanups, 
something that is very good for the environment. It contains breaks for 
our veterans and those who have been and are in combat at this time. It 
contains increases for small businesses, and certainly that is 
something that is very, very important to millions of people throughout 
this country.
  Mr. Speaker, this is a very modest proposal. I think it is about a 2 
percent tax break. I urge passage of this bill.
  Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from 
Ohio (Mr. Kucinich).
  Mr. KUCINICH. Mr. Speaker, I thank the gentlewoman for yielding me 
this time.
  What the majority is seeking to accomplish here is another transfer 
of wealth from the great mass of Americans to a privileged few. This 
bill would raise taxes on 17 million American middle-class families by 
as much as $640. Millionaires get tax cuts as much as $32,000. People 
who bet on the market are going to see their taxes cut or reduced, 
while workers are not going to see that kind of relief because this 
bill is about a transfer of wealth upwards, a transfer of wealth from 
the poor and the middle class to the wealthy. More than half of the 
American taxpayers will get less than $30 out of this so-called tax 
cut; yet that is what this administration's strategy has been all 
about.
  There has been no trickle-down benefits from their previous tax cuts 
of over a trillion dollars. Americans' savings have disappeared, credit 
cards are maxed out, home equity is exhausted, foreclosures have 
increased, pension funds are disappearing, health care benefits for 
many have been cut or eliminated. There are 45 million Americans 
without health insurance. The wealth in this country is being 
transferred upward, and as wealth accelerates upward, the quality of 
our democracy is deteriorating. This bill continues that trend with 
spending cuts suffered by college students, suffered by senior citizens 
and children and family farmers.
  My colleague Congressman Lewis asked what would Jesus do. We know his 
teachings. He said whatever you do for the least of the brethren, you 
do for the Lord. This bill does not do for the least. It does for those 
who have the most. There is a transfer of wealth to the great mass of 
Americans to a few as a matter of policy here. It is tax cuts, it is 
the war, it is all of the spending that is accomplished by our majority 
brothers and sisters goes to help those who are wealthy become 
wealthier. That is not how you can maintain a democracy.
  The tax system is central to making sure that we stay a democracy, 
and yet

[[Page 27775]]

what we see here is the beginning of a plutocracy by continuing the 
acceleration of wealth upwards. We need to take stock and assessment of 
what these tax policies are doing to undermine people in this country, 
of what these tax policies are doing to make it impossible for a middle 
class to survive, of what these tax policies are ignoring in terms of 
trying to protect America's manufacturers. There are auto workers and 
steel workers who are looking for a way for businesses, their 
industries, to survive; and instead we are worrying about accelerating 
the wealth upward.
  We need to take stock of this. This is not only a fiscal question. It 
is a moral question, and the arc of our moral fiber here is going to be 
determined on whether or not we can stand up to this challenge about 
accelerating the wealth upwards.
  Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the gentleman from 
Texas (Mr. Hensarling).
  Mr. HENSARLING. Mr. Speaker, unless we enact H.R. 4297, Americans 
will receive a most unwelcomed Christmas gift from the Democrats: a 
huge automatic tax increase. This will cost families billions of their 
dollars and jeopardize millions of their jobs. We cannot sit idly by 
and let the Democrats do this.
  Tax relief has already created more than 4.4 million new jobs; but if 
you raise taxes, you start taking these jobs away.
  Mr. Speaker, let me tell you about a few of the jobs from my east 
Texas district that could be lost if the Democrats succeed in their tax 
increase plan today. Let me tell you about Hugh Dublin who owns East 
Texas Right of Way in Tennessee Colony, Texas. He specializes in the 
land-leasing business. Due to tax relief, his company has grown from 
two full-time employees to four full-time employees and four part-
timers. His two new full-time employees are named Dan and David. They 
were unemployed, but now they are able to start new careers in a 
growing business.
  The Democrats want to raise taxes on Hugh Dublin and his small 
business. They want to jeopardize Dan's and David's paychecks and 
replace them with welfare checks, and they call that compassion.
  Eddie Alexander owns Triple S Electric in Henderson County, Texas. 
They are an electrical contracting business. For the first 3\1/2\ years 
he was in business, it was just him and one part-time helper. Since the 
passage of the President's economic growth plan, he has been able to 
hire two more additional employees named Jarad and John, both of whom 
were out of work but both of whom now provide homes for their families.
  The Democrats now want to raise taxes on Eddie Alexander and his 
small business. They want to jeopardize Jarad's and John's paychecks 
and replace them with welfare checks; and this they call compassion.
  Gill Travers owns Travers & Company. They are a home building company 
in Athens, Texas. Thanks to the housing boom created by President 
Bush's tax relief plan, Travers & Company has had to hire three new 
workers. Jan, who was previously unemployed, was hired to help clean up 
the job sites. Business is so good she had to turn around and hire 
Calvin and Christy. They were unemployed, too. The Democrats now want 
to raise taxes on Gill Travers and his small business. They want to 
jeopardize Jan, Calvin, and Christy's paychecks and replace them with 
welfare checks; and this they call compassion.
  Mr. Speaker, tax relief has created over 4.4 million new tax-paying 
jobs of the future; 4.4 million hard-working Americans can now provide 
for their families this Christmas. More than just providing food and 
shelter, these jobs are providing newfound hope and opportunity. The 
Democrats would take all of this away.
  We cannot go back. We must prevent this massive Democrat tax 
increase. We must support jobs and support the rule for H.R. 4297.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Washington (Mr. Baird).
  Mr. BAIRD. Mr. Speaker, since I first came to Congress, I made it a 
priority to restore sales tax deductibility for my constituents in 
Washington State. Last year, working with a bipartisan coalition lead 
by Mr. Kevin Brady and myself, we did successfully do that. This 
deduction saved Washington State taxpayers over $500 million last year 
alone.
  Unfortunately, the sales tax deduction will expire at the end of this 
year, and we must extend that deduction. Accordingly, I applaud both 
the Democrats and the Republicans for including in their packages a 1-
year extension. Frankly, I would like to have made it a permanent 
extension.
  Nevertheless, I am concerned at a time of war in the aftermath of 
this country's most devastating natural disaster how we can in good 
conscience support a tax bill that will add at least $20 billion to our 
national debt to provide a tax break that goes predominantly to the 
wealthy, and by that I mean the capital gains and dividend tax cut.
  Earlier, the distinguished chairman of the Rules Committee said the 
American people get it. I have to say, I just had five town halls in my 
district; the American people do get it. They get that this bill, the 
Republican majority bill, is passing on enormous deficits to our 
children. Debt to our children, that is what we are doing.
  The Democratic substitute, by comparison, is revenue neutral. It 
extends the tax breaks that benefit small individual taxpayers and 
small businesses, and it extends sales tax deductibility without 
increasing the deficit. What is more, the Democratic substitute 
protects taxpayers against the AMT hit as people's income brings them 
into the AMT category.
  If my friends on the other side of the aisle want to say if we do not 
extend the dividend and capital gains tax cut, we have an automatic tax 
increase, why not say the same about the AMT fix? You have not chosen 
to put the AMT fix in your bill. Does that not constitute an automatic 
tax increase? I believe it does. The Democrats have prevented that.
  The difference is this: when Republicans talk about choices, the 
choices they are talking about is whether the most wealthy people in 
this country will choose to take their earnings, or winnings, from 
capital gains or dividends. The poor people in this country have to 
choose between heating their houses and providing food for their 
children.
  Mr. PUTNAM. Mr. Speaker, I yield myself such time as I may consume.
  I would remind the gentleman that AMT relief is not in our package 
because it passed yesterday in the House by a vote of 414-4. That is 
why it is not in this package, because it passed yesterday.
  We all talk about what we do here in Washington as it relates to the 
economy. The bottom line is that the economy is doing quite well 
because Americans are out there working hard every day. A lot of them 
are getting up before the sun comes up and not getting home until the 
sun goes down, bringing in food and fiber from our fields, 
manufacturing the devices that we take for granted each and every day 
in our manufacturing facilities, and working hard in an expanding and 
robust services economy, going into classrooms, going into hospitals, 
building houses that are part of the American Dream for more and more 
Americans. In fact, a record number of Americans now have achieved that 
piece of the American Dream through homeownership.
  So it is ordinary Americans doing every day what they do best that is 
allowing this economy to move forward, and our role in that is to 
create the climate that allows them to maximize that opportunity, to 
put in place policies that keep inflation in check, keep interest rates 
low, and reduce the tax burden in their lives.
  Today, more corporations pay dividends than at any other time. In 
fact, there has been a 69 percent increase in S&P 500 companies that 
pay dividends. It is not only wealthy people that are benefiting from 
dividend taxes being cut and the corresponding increase in companies 
paying dividends. In fact, it typically is your retirees who are owning 
those stocks that they have invested in their whole lives that are

[[Page 27776]]

paying the dividends to supplement their retirement income.
  Prior to us changing that policy, the number of companies paying 
dividends over the last several years had actually gone down by 45 
percent; and since the change in the tax that lowered the dividend tax, 
it went up almost 70 percent. That is a clear indication that what we 
did here in that small policy changed behavior in the business world to 
the benefit of all Americans: poor Americans, seniors, middle class, 
professionals, people who make six figures, people who make five 
figures. Everybody benefited from that. In fact, disproportionately, 
seniors benefited from that.
  Everybody benefits from the fact that unemployment is now at 5 
percent. That is indisputable. Would we like to see it go lower? Of 
course. Would we like to put policies in place that do that? Of course. 
Does raising taxes on the American people help lower the unemployment 
rate? I do not think so. Perhaps some on the other side of the aisle 
would disagree.
  More Americans own stock today than ever before. This is not a class-
warfare argument: 91 million individuals own stock in America. This 
bill puts in place a policy that encourages more Americans to invest in 
America. That, I believe, is sound economic policy.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
Washington (Mr. Baird) to explain AMT.
  Mr. BAIRD. Mr. Speaker, I am well aware of the issues with AMT. The 
issue with me is this: you have not paid for it; the Democrats have. 
What you are not talking about is you are passing deficit on to our 
kids. You are passing debt on to our kids.
  I visited with high schools and had town halls last weekend, and 
people said they are desperately concerned about the size of the 
Nation's deficit and the size of the Nation's debt. The Democratic 
package is paid for; the Republican package is not. The Democratic 
package does support small businesses and low-income folks and supports 
the middle class. The Republican package, the bulk of the economic 
benefits from these tax cuts go to the people who need it least at a 
time when we are fighting a war and trying to recover from a disaster. 
I think that is a mistake.
  We support tax cuts, but we would target them to the people who most 
need it; and you target them to the people who most want it, but least 
need it. That is the fundamental difference, and I think the American 
people see that difference.

                              {time}  1115

  Mr. PUTNAM. Addressing the gentleman's concerns, yesterday 414 
Members of the House voted for AMT relief. I am unclear which piece of 
that the gentleman is referring to that the Democrats had that paid for 
that as it relates to that. And the gentleman, in reference to his 
concern about the deficit, which is legitimate and shared by all of us 
about the growth of the deficit, failed to point out that the deficit 
has gone down over $100 billion in the last year. The size of the U.S. 
deficit dropped $100 billion based on the strength of the economy.
  And finally, to the gentleman's point, he illustrated and spoke very 
clearly and directly about the Democratic intentions with regard to tax 
policy. They want to pick and choose the winners in American society, 
and we want everyone, everyone on equal footing to have the opportunity 
to achieve their piece of the American dream. We do not propose to pick 
winners and losers in economic policy and tax policy. We say everybody 
has got a shot at making the most of their opportunities in this 
country. Everybody has got a shot at paying less in taxes on capital 
gains. Everybody has got a shot at paying less in taxes on dividends 
that are paid by companies that support all Americans. Everybody has 
got an opportunity to go to college through the tax incentives that are 
in there for higher education opportunities. Everybody has got an 
opportunity to achieve home ownership through economic policies that 
keep interest rates low and inflation in check. That is the difference, 
an opportunity for each and every individual, according to their own 
merits and their own hard work, and their own character and their own 
ability to get out there every day to do it. And the other side's 
proposal to pick and choose the winners in our society.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from 
Massachusetts (Mr. Markey).
  Mr. MARKEY. Mr. Speaker, I rise in strong opposition to this $56 
billion tax break, mostly for millionaires in our country. Forty-five 
percent of this tax break goes to the ultra rich in our country, the 
top 1 percent average getting $32,000 apiece in tax breaks out of this 
bill. So how do they get the money? Well, last month, the Republicans 
lectured us on the need to have fiscal discipline. They had to cut 
Medicaid for the poorest seniors and kids. They had to cut student 
loans for children across our country. They had to cut the food stamp 
program for kids. But guess what? The amount of money that they were 
cutting on food stamps and Medicaid and health care services and 
student loans is exactly equal to the amount of money they are giving 
in tax breaks to millionaires. In other words, every dollar that is cut 
out of the Medicaid program is going to be put over here into tax 
breaks for millionaires. $50 billion. $50 billion cut in Medicaid and 
student loans, $50 billion in tax cuts for the rich. For health care 
programs, as they cut the health care programs, it goes over here today 
on a tax cut for millionaires.
  When they cut student loans the money comes from kids and it is going 
over here to millionaires. And by the way, they are $6 billion short, 
so they are just going to increase the deficit. Why? So they can give 
more tax breaks over here to millionaires. More tax breaks for 
millionaires. Cut poor people, cut children, cut Medicaid benefits, cut 
the money that we are going to be giving to seniors, to keep them in 
nursing homes with Alzheimer's and with Parkinson's disease, just keep 
cutting it. Give more tax breaks to the millionaires. Something is 
going to have to be cut.
  They cut the poorest. They cut the most vulnerable. They cut the 
youngest. And where does the money go? The money goes to millionaires. 
That is what this whole thing is about. It is one big scam. You know, 
there is an old joke. The priest goes up into the pulpit on Sunday and 
he says, on Wednesday, Father O'Brien will lecture on the evils of 
gambling in the church hall. On Thursday in the church hall, bingo.
  Last month the Republicans lectured us on the need for them to cut 
poor people to do something about the deficit. Today, bingo. Tax cuts 
for the millionaires. Every millionaire is a winner in America under 
the Republicans' plan. But the money is all coming from the poorest 
people in our country and it is going over into the hands of those who 
need it least. Vote no on this Republican atrocity in our country at a 
time when the poor need it the most and the rich need it the least.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. LaHood). The Chair will remind all 
persons in the gallery that they are here as guests of the House and 
that any manifestation of approval or disapproval of proceedings or 
other audible conversation is in violation of the rules of the House.
  Mr. PUTNAM. Mr. Speaker, I yield myself such time as I may consume.
  Recognizing that volume does not always make up for sound policy, I 
would just pose the question as to why the Democratic substitute leaves 
out many of the people that the gentleman purported to speak for. The 
Democratic substitute does not include the savers credit for low income 
families, those low income families who are contributing to IRAs and 
pension plans, scrimping and saving every day, every week, every month 
to put aside money to prepare for their own retirement, to

[[Page 27777]]

prepare for their own retirement security so that they are not solely 
dependent on the government. Their substitute is silent on that point.
  Why are they silent on the point of assistance for small businesses, 
allowing them to increase section 179 expensing so that they can get 
that new piece of equipment, add the new line, which means more 
employees, more growth, more purchasing and a better economic ripple 
effect in the community? Why do you leave out small businesses along 
with your low income savers?
  Why do you leave out the part that impacts domestic manufacturers who 
finance sales of large equipment to foreign customers?
  We hear an awful lot of concern about outsourcing. Here you have 
American-based companies doing everything they can to trade in an 
increasingly complex globalized economy, and you leave them out of your 
substitute.
  Why do you leave out the parts that deal with capital gains and 
dividends? Why is it only about the wealthy and not about every one of 
those 91 million Americans who own stock, who are trying to invest in 
America, who understand that markets offer them an opportunity to grow 
and create opportunities that they may not have had otherwise?
  Why are all of those 91 million Americans who participate in our 
capital market so bad? Why are they such awful people that they ought 
to be singled out and excluded from the tax policy that you have 
created?
  Why do you leave out the tax credits for cleaning up brownfield 
sites? That is something that I have always thought was the cornerstone 
of the Democratic Party, cleaning up our environment. It is certainly 
something that we are proud of our record on with Teddy Roosevelt and 
our conservation effort. We believe that you can use the Tax Code to 
encourage businesses to go into areas that formerly were 
environmentally damaged sites and clean them up and create jobs and 
opportunity in otherwise blighted areas. This is an issue that impacts 
disproportionately urban areas. Why would we leave them out? The 
Democratic substitute is silent on these points.
  It is important that we move forward together with sound economic 
policies that encourage people to invest and save and be a part of this 
ever complicated globalized economy, not pick and choose the winners 
and single out individual cases of success to be punished, which is 
what their bill seeks to do.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I have one remaining speaker. May I 
inquire if my colleague is about ready to close?
  Mr. PUTNAM. I have one remaining speaker as well.
  Ms. SLAUGHTER. Mr. Speaker, I yield 4 minutes to the gentleman from 
North Dakota (Mr. Pomeroy).
  Mr. POMEROY. Mr. Speaker, much of the rhetoric coming from the 
majority in defense of this sinful package is pure fiction. So let us 
discuss it in those terms. You know, Charles Dickens has written 
perhaps one of the most famous pieces of fiction discussed at this time 
of year, the holiday season, A Christmas Carol. The lesson of Christmas 
Carol, Scrooge, this miserly man, very, very well fixed financially 
that chose not to give to others. And we know that in the course of 
this beautiful story the ghosts of Christmas past help him reflect upon 
the paucity of his life, and in the end he has a new spirit of 
community, helping others, including the Cratchett family, with the 
crippled son, Tiny Tim.
  Well, I think that what the majority wants to do is rewrite the 
Christmas Carol. It is probably going to be titled ``A Christmas Carol 
II, Revenge of the Scrooge.'' And in this Christmas Carol, Scrooge, 
sitting in his mansion, contemplating his wealth, wants more. And 
rather than be challenged as to the paucity of his inclination, we have 
a Republican majority, bought and paid for, that is all too eager to 
placate the most selfish whim of Mr. Scrooge.
  And so, as the story unfolds, there is more and more for Scrooge, and 
taking, from the very beginning, a low base, less and less for Mr. 
Cratchett who loses his job when it is outsourced overseas, tries to 
find something at minimum wage which has not been raised since 1997, 
and Tiny Tim, Tiny Tim is left out all together.
  Let us ask ourselves some basic questions about this. After passing a 
$31 billion tax reduction yesterday out of this House, do we really 
want to add an additional $56 billion without having it paid for?
  Look at this. This shows that we are north of $8 trillion in 
accumulated debt, that the average share is $27,000 of debt per 
American.
  You know, another Christmas story talks about naughty children 
getting a lump of coal in their stocking. Well, this majority gives 
every child $27,000 of debt, debt that will fall on their shoulders 
when the baby boomers retire with this debt woefully unpaid.
  The second question, do we need it? You know about half of this 
package today, for all the talk about how desperately it is needed, 
does not take effect until 2009 and 2010. Existing Tax Code makes the 
very provision that they are talking about in 2006, in 2007 and in 
2008. It is there for the next 3 years. They are talking about driving 
us deeper in debt today, cutting programs that help people today so 
that we can deal with something that happens in 2009 and 2010.
  Next question. Is it fair? Well, in looking at who gets what under 
this bill, you know, most of the people in this country, 55 percent, 
earn less than $40,000. They will come out on average $7, $7 per under 
this dividend and tax cut provision. One out of 500, one out of 500 
taxpayers, the most affluent of the 500, one out of 500 get nearly half 
of this bill. And they will average, per taxpayer, more than $30,000 
back. So in this Christmas season, we are hammering on programs that 
help those who need help.
  We are passing a tax package that gives nothing, virtually, to most 
under this capital gains dividend tax cut provision, and we are 
absolutely loading it up for the wealthiest few in this country. This 
is Christmas Carol II. This is Revenge of the Scrooge. This is totally 
bad policy, and it must be stopped.
  I urge a no vote on this rule.
  Mr. PUTNAM. Mr. Speaker, I yield 3 minutes to the distinguished 
chairman of the Ways and Means Committee, the gentleman from California 
(Mr. Thomas).
  Mr. THOMAS. Well, I guess we are going to be telling Christmas 
stories. Rather than fiction, I would rather deal with fact. Yesterday 
414 Members of the House voted to assist a group who, on average, are 
far richer than those who receive dividends and cap gains. There were 
four no votes. All four of them were on the Democratic side of the 
aisle. And I respect those people for casting what I believe was a 
sincere vote. But out of the 188 Democrats who voted aye, I just have 
to point out that my friend who just finished speaking, who is on the 
Ways and Means Committee, protesting the amount in this vote, voted 
aye. Some of the other folks, just let me run down the list 
alphabetically, which tends to touch on Lowey, Lynch, Maloney, Markey, 
you heard him, Marshall, Matheson, Matsui, McCarthy, McCollum, 
McDermott, all of them voted to assist those individuals in this 
society that are far richer, on average, than many of those seniors 
who, investing prudently over the years, receive dividends and capital 
gains on their investment in deferred consumption that they need, in 
their senior years.

                              {time}  1130

  So as we listen to the rhetoric and the term ``millionaire'' is 
repeated over and over again by my friends on the other side of the 
aisle, it begins to be a question of whose millionaire are they talking 
about. If one is a millionaire in Massachusetts, it seems, we want to 
protect them. If one is a millionaire in New York, we want to protect 
them.
  At some point the rhetoric, the fiction, has to be compared to the 
truth. The truth is 188 Democrats, every Democrat member of the Ways 
and Means Committee, voted to assist people yesterday that are far 
richer on average

[[Page 27778]]

than the individuals who receive dividends and cap gains. That is not a 
Christmas story. That is the truth.
  Ms. SLAUGHTER. Mr. Speaker, I yield 3 minutes to the gentleman from 
New York (Mr. Rangel).
  Mr. RANGEL. Mr. Speaker, the gentleman picked a heck of a time to 
lose his voice here now.
  Mr. THOMAS. Mr. Speaker, will the gentleman yield?
  I thought the gentlewoman from New York indicated she had one final 
speaker, and that final speaker spoke, Mr. Pomeroy.
  Mr. RANGEL. I am terribly sorry. I will take it up then when we have 
the opportunity.
  Mr. THOMAS. I was asking the gentlewoman from New York.
  Ms. SLAUGHTER. As it happens, I have extra time, and I yielded to Mr. 
Rangel to respond to your comments.
  Mr. THOMAS. Notwithstanding the equal time, Mr. Speaker, if the 
gentlewoman says it is a final speaker, we normally honor that.
  The SPEAKER pro tempore (Mr. LaHood). The gentleman from New York is 
recognized for 3 minutes.
  Mr. RANGEL. Mr. Speaker, I do not want to get technical about this. I 
just want to set the record straight, and that is that we all agree 
that the alternative minimum tax is an unfair tax on people because it 
was not planned by the Ways and Means Committee and by the Congress. 
So, of course, we thought yesterday and we think today that these 
people, who through inflation were thrown into this category, should be 
protected. And that is why we were so disappointed that the 
Republicans, by party line, rejected the Democrats when we were doing 
the bill in the committee from not being included in the reconciliation 
bill.
  Now, we all know that the bill that we passed yesterday on the 
suspension calendar is not protected like this $56 billion is protected 
today. As a matter of fact, people should know that it may appear to be 
a technicality, but the only way that this alternative minimum release 
bill that we passed yesterday in the suspension calendar is that not 
one of the 100 Senators over there objects. We need the consent of 
every Senator to provide the AMT bill with protection. That is not so. 
If the Republicans were so concerned about these people who got caught 
into this trap in getting the alternative minimum tax treatment, it 
would be placed in the reconciliation bill.
  So I do not think you ought to bring up things when the facts are 
against you. It is true that you have decided that those people who 
want relief on capital gains taxes and corporate dividends, even though 
they do not get hit until 2009, that you are prepared to have the 
people who get by the AMT this year or next year, rather, in their tax 
burden to get hit at the expense of those people that are much richer 
and much smaller in number.
  So I really think that in this holiday season, we are doing enough 
damage without distorting the truth. You have had your priorities in 
terms of protecting the AMT people or protecting the group that is 
going to be allegedly protected today, even though they do not need 
any, not today, not next year, and not the year after.
  So those are the facts, and I thank the gentlewoman from New York for 
affording us the opportunity to at least, in this holiday season, 
whether we like the bill or not, let truth prevail.
  Ms. SLAUGHTER. Mr. Speaker, I yield myself the balance of my time.
  I would like to urge a ``no'' vote on the rule, a ``no'' vote on the 
bill, and say to every Member of the House of Representatives if they 
want the AMT fix protected, the only way in the world they can do it 
today is to vote for the Democrat substitute.
  Mr. Speaker, I have no further requests for time, and I yield back 
the balance of my time.
  Mr. PUTNAM. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, the debate here has been consumed by the discussion of 
capital gains and dividends, and that is a big part of this and that is 
appropriate.
  But the AMT relief component, which has been the source of much 
recent debate, we dealt with yesterday. We dealt with it on a vote of 
414-4, overwhelming, bipartisan, on the suspension calendar, which I 
will remind Members under the rule, requires a two-thirds vote to pass. 
It is out of here. The AMT relief bill moved through here in an 
expeditious manner on a bipartisan basis.
  What this bill does is provide continued assistance for those people 
who are saving to go to college. Middle- and low-income students, this 
is their shot at going to college. Assistance for those who are saving 
for retirement, seniors, low income, saving through an IRA and a 
pension plan for retirement. Ten States that do not have a State income 
tax that want the same tax treatment that high-tax States have, this 
expires in 3 weeks unless we pass the bill. Just one of several 
important components in this tax relief package.
  It is vitally important that we pass this and not allow taxes to go 
up 3 weeks from now on those 10 States, not allow teachers to lose 
their deductibility on classroom supplies, not allow low-income seniors 
and savers to be punished under the Democratic plan.
  Mr. Speaker, I urge the Members to support the rule and support the 
underlying bill.
  Mr. Speaker, I yield back the balance of my time, and I move the 
previous question on the resolution.
  The previous question was ordered.
  The resolution was agreed to.
  A motion to reconsider was laid on the table.
  Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 588, I call up 
the bill (H.R. 4297) to provide for reconciliation pursuant to section 
201(b) of the concurrent resolution on the budget for fiscal year 2006, 
and ask for its immediate consideration.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore. Pursuant to House Resolution 588, the bill 
is considered read and the amendment in the nature of a substitute 
printed in the bill is adopted.
  The text of the amendment in the nature of a substitute is as 
follows:

                               H.R. 4297

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE, ETC.

       (a) Short Title.--This Act may be cited as the ``Tax Relief 
     Extension Reconciliation Act of 2005''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of the Internal 
     Revenue Code of 1986.
       (c) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title, etc.

         TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006

Sec. 101. Allowance of nonrefundable personal credits against regular 
              and minimum tax liability.
Sec. 102. Tax incentives for business activities on Indian 
              reservations.
Sec. 103. Work opportunity credit.
Sec. 104. Welfare-to-work credit.
Sec. 105. Deduction for corporate donations of computer technology and 
              equipment.
Sec. 106. Availability of medical savings accounts.
Sec. 107. 15-year cost recovery for leasehold improvements.
Sec. 108. 15-year cost recovery for restaurant improvements.
Sec. 109. Taxable income limit on percentage depletion for oil and 
              natural gas produced from marginal properties.
Sec. 110. District of Columbia Enterprise Zone.
Sec. 111. Possession tax credit with respect to American Samoa.
Sec. 112. Parity in the application of certain limits to mental health 
              benefits.
Sec. 113. Research credit.
Sec. 114. Qualified Zone Academy Bonds.
Sec. 115. Certain expenses of elementary and secondary school teachers.
Sec. 116. Qualified tuition and related expenses.
Sec. 117. State and local general sales taxes.

 TITLE II--EXTENSIONS OF CERTAIN PROVISIONS FOR 2 ADDITIONAL YEARS AND 
                          OTHER MODIFICATIONS

Sec. 201. Expensing of environmental remediation costs.
Sec. 202. Controlled foreign corporations.
Sec. 203. Capital gains and dividends rates.
Sec. 204. Saver's credit.
Sec. 205. Increased expensing for small business.

                      TITLE III--OTHER PROVISIONS

Sec. 301. Clarification of taxation of certain settlement funds.

[[Page 27779]]

Sec. 302. Modification of active business definition under section 355.
Sec. 303. Veterans' mortgage bonds.
Sec. 304. Capital gains treatment for certain self-created musical 
              works.
Sec. 305. Vessel tonnage limit.
Sec. 306. Modification of special arbitrage rule for certain funds.

         TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006

     SEC. 101. ALLOWANCE OF NONREFUNDABLE PERSONAL CREDITS AGAINST 
                   REGULAR AND MINIMUM TAX LIABILITY.

       (a) In General.--Paragraph (2) of section 26(a) (relating 
     to special rule for taxable years 2000 through 2005) is 
     amended--
       (1) in the text by striking ``or 2005'' and inserting 
     ``2005, or 2006'', and
       (2) in the heading by striking ``2005'' and inserting 
     ``2006''.
       (b) Conforming Provisions.--
       (1) Subsection (i) of section 904 (relating to coordination 
     with nonrefundable personal credits) is amended by striking 
     ``or 2005'' and inserting ``2005, or 2006''.
       (2) The amendments made by sections 201(b), 202(f), and 
     618(b) of the Economic Growth and Tax Relief Reconciliation 
     Act of 2001 shall not apply to taxable years beginning during 
     2006.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 102. TAX INCENTIVES FOR BUSINESS ACTIVITIES ON INDIAN 
                   RESERVATIONS.

       (a) Indian Employment Tax Credit.--
       (1) In general.--Subsection (f) of section 45A (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply to taxable years beginning after December 31, 
     2005.
       (b) Accelerated Depreciation for Business Property on 
     Indian Reservations.--
       (1) In general.--Paragraph (8) of section 168(j) (relating 
     to termination) is amended by striking ``December 31, 2005'' 
     and inserting ``December 31, 2006''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply with respect to property placed in service after 
     December 31, 2005.

     SEC. 103. WORK OPPORTUNITY CREDIT.

       (a) In General.--Subparagraph (B) of section 51(c)(4) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Increase in Age Limit for Food Stamp Recipients.--
     Clause (i) of section 51(d)(8)(A) (relating to qualified food 
     stamp recipient) is amended by striking ``25'' and inserting 
     ``35''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to individuals who begin work for the employer 
     after December 31, 2005.

     SEC. 104. WELFARE-TO-WORK CREDIT.

       (a) In General.--Subsection (f) of section 51A (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to individuals who begin work for the employer 
     after December 31, 2005.

     SEC. 105. DEDUCTION FOR CORPORATE DONATIONS OF COMPUTER 
                   TECHNOLOGY AND EQUIPMENT.

       (a) In General.--Subparagraph (G) of section 170(e)(6) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to contributions made in taxable years beginning 
     after December 31, 2005.

     SEC. 106. AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.

       (a) In General.--Paragraphs (2) and (3)(B) of section 
     220(i) (defining cut-off year) are each amended by striking 
     ``2005'' each place it appears in the text and headings and 
     inserting ``2006''.
       (b) Conforming Amendments.--
       (1) Paragraph (2) of section 220(j) is amended--
       (A) in the text by striking ``or 2004'' each place it 
     appears and inserting ``2004, or 2005'', and
       (B) in the heading by striking ``or 2004'' and inserting 
     ``2004, or 2005''.
       (2) Subparagraph (A) of section 220(j)(4) is amended by 
     striking ``and 2004'' and inserting ``2004, and 2005''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.
       (d) Time for Filing Reports, Etc.--
       (1) The report required by section 220(j)(4) of the 
     Internal Revenue Code of 1986 to be made on August 1, 2005, 
     shall be treated as timely if made before the close of the 
     90-day period beginning on the date of the enactment of this 
     Act.
       (2) The determination and publication required by section 
     220(j)(5) of such Code with respect to calendar year 2005 
     shall be treated as timely if made before the close of the 
     120-day period beginning on the date of the enactment of this 
     Act. If the determination under the preceding sentence is 
     that 2005 is a cut-off year under section 220(i) of such 
     Code, the cut-off date under such section 220(i) shall be the 
     last day of such 120-day period.

     SEC. 107. 15-YEAR COST RECOVERY FOR LEASEHOLD IMPROVEMENTS.

       (a) In General.--Clause (iv) of section 168(e)(3)(E) 
     (relating to 15-year property) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 108. 15-YEAR COST RECOVERY FOR RESTAURANT IMPROVEMENTS.

       (a) In General.--Clause (v) of section 168(e)(3)(E) 
     (relating to 15-year property) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 109. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR 
                   OIL AND NATURAL GAS PRODUCED FROM MARGINAL 
                   PROPERTIES.

       (a) In General.--Subparagraph (H) of section 613A(c)(6) 
     (relating to oil and natural gas produced from marginal 
     properties) is amended by striking ``January 1, 2006'' and 
     inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 110. DISTRICT OF COLUMBIA ENTERPRISE ZONE.

       (a) Period for Which Designation Applicable.--Subsection 
     (f) of section 1400 (relating to time for which designation 
     applicable) is amended by striking ``December 31, 2005'' both 
     places it appears and inserting ``December 31, 2006''.
       (b) Tax-Exempt Economic Development Bonds.--Subsection (b) 
     of section 1400A (relating to period of applicability) is 
     amended by striking ``December 31, 2005'' and inserting 
     ``December 31, 2006''.
       (c) Zero Percent Capital Gains Rate.--
       (1) In general.--Subsection (b) of section 1400B (relating 
     to DC Zone Asset) is amended by striking ``January 1, 2006'' 
     each place it appears and inserting ``January 1, 2007''.
       (2) Conforming amendments.--
       (A) Paragraph (2) of section 1400B(e) (relating to gain 
     before 1998 and after 2010 not qualified) is amended--
       (i) by striking ``December 31, 2010'' and inserting 
     ``December 31, 2011'', and
       (ii) by striking ``2010'' in the heading and inserting 
     ``2011''.
       (B) Paragraph (2) of section 1400B(g) (relating to sales 
     and exchanges of interests in partnerships and S corporations 
     which are DC Zone businesses) is amended by striking 
     ``December 31, 2010'' and inserting ``December 31, 2011''.
       (C) Subsection (d) of section 1400F (relating to certain 
     rules to apply) is amended by striking ``December 31, 2010'' 
     and inserting ``December 31, 2011''.
       (d) First-Time Homebuyer Credit for District of Columbia.--
     Subsection (i) of section 1400C (relating to application of 
     section) is amended by striking ``January 1, 2006'' and 
     inserting ``January 1, 2007''.
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall take effect on January 
     1, 2006.
       (2) Tax-exempt economic development bonds.--The amendment 
     made by subsection (b) shall apply to obligations issued 
     after the date of the enactment of this Act.

     SEC. 111. POSSESSION TAX CREDIT WITH RESPECT TO AMERICAN 
                   SAMOA.

       (a) In General.--Subparagraph (A) of section 936(j)(8) 
     (relating to special rules for certain possessions) is 
     amended by inserting before the period at the end the 
     following: ``(before January 1, 2007, in the case of American 
     Samoa)''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 112. PARITY IN THE APPLICATION OF CERTAIN LIMITS TO 
                   MENTAL HEALTH BENEFITS.

       (a) In General.--Paragraph (3) of section 9812(f) (relating 
     to application of section) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Effective Dates.--The amendment made by subsection (a) 
     shall take effect on the date of the enactment of this Act.

     SEC. 113. RESEARCH CREDIT.

       (a) Extension.--
       (1) In general.--Subparagraph (B) of section 41(h)(1) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (2) Conforming amendment.--Subparagraph (D) of section 
     45C(b)(1) (relating to special rule) is amended by striking 
     ``December 31, 2005'' and inserting ``December 31, 2006''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to amounts paid or incurred after December 31, 
     2005.
       (b) Increase in Rates of Alternative Incremental Credit.--
       (1) In general.--Subparagraph (A) of section 41(c)(4) 
     (relating to election of alternative incremental credit) is 
     amended--
       (A) by striking ``2.65 percent'' and inserting ``3 
     percent'',
       (B) by striking ``3.2 percent'' and inserting ``4 
     percent'', and
       (C) by striking ``3.75 percent'' and inserting ``5 
     percent''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.
       (c) Alternative Simplified Credit for Qualified Research 
     Expenses.--
       (1) In general.--Subsection (c) of section 41 (relating to 
     base amount) is amended by redesignating paragraphs (5) and 
     (6) as paragraphs (6)

[[Page 27780]]

     and (7), respectively, and by inserting after paragraph (4) 
     the following new paragraph:
       ``(5) Election of alternative simplified credit.--
       ``(A) In general.--At the election of the taxpayer, the 
     credit determined under subsection (a)(1) shall be equal to 
     12 percent of so much of the qualified research expenses for 
     the taxable year as exceeds 50 percent of the average 
     qualified research expenses for the 3 taxable years preceding 
     the taxable year for which the credit is being determined.
       ``(B) Special rule in case of no qualified research 
     expenses in any of 3 preceding taxable years.--
       ``(i) Taxpayers to which subparagraph applies.--The credit 
     under this paragraph shall be determined under this 
     subparagraph if the taxpayer has no qualified research 
     expenses in any one of the 3 taxable years preceding the 
     taxable year for which the credit is being determined.
       ``(ii) Credit rate.--The credit determined under this 
     subparagraph shall be equal to 6 percent of the qualified 
     research expenses for the taxable year.
       ``(C) Election.--An election under this paragraph shall 
     apply to the taxable year for which made and all succeeding 
     taxable years unless revoked with the consent of the 
     Secretary. An election under this paragraph may not be made 
     for any taxable year to which an election under paragraph (4) 
     applies.''.
       (2) Coordination with election of alternative incremental 
     credit.--
       (A) In general.--Section 41(c)(4)(B) (relating to election) 
     is amended by adding at the end the following: ``An election 
     under this paragraph may not be made for any taxable year to 
     which an election under paragraph (5) applies.''.
       (B) Transition rule.--In the case of an election under 
     section 41(c)(4) of the Internal Revenue Code of 1986 which 
     applies to the taxable year which includes the date of the 
     enactment of this Act, such election shall be treated as 
     revoked with the consent of the Secretary of the Treasury if 
     the taxpayer makes an election under section 41(c)(5) of such 
     Code (as added by subsection (a)) for such year.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 114. QUALIFIED ZONE ACADEMY BONDS.

       (a) In General.--Paragraph (1) of section 1397E(e) 
     (relating to national limit) is amended by striking ``and 
     2005'' and inserting ``2005, and 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to obligations issued after December 31, 2005.

     SEC. 115. CERTAIN EXPENSES OF ELEMENTARY AND SECONDARY SCHOOL 
                   TEACHERS.

       (a) In General.--Subparagraph (D) of section 62(a)(2) 
     (relating to certain expenses of elementary and secondary 
     school teachers) is amended by striking ``or 2005'' and 
     inserting ``2005, or 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to expenses paid or incurred in taxable years 
     beginning after December 31, 2005.

     SEC. 116. QUALIFIED TUITION AND RELATED EXPENSES.

       (a) In General.--Subsection (e) of section 222 (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (b) Limitations.--Paragraph (2) of section 222(b) (relating 
     to applicable dollar limit) is amended by striking 
     subparagraphs (A) and (B), by redesignating subparagraph (C) 
     as subparagraph (B), and by inserting before subparagraph (B) 
     (as so redesignated) the following:
       ``(A) 2006.--In the case of a taxable year beginning in 
     2006, the applicable dollar amount shall be equal to--
       ``(i) in the case of a taxpayer whose adjusted gross income 
     for the taxable year does not exceed $65,000 ($130,000 in the 
     case of a joint return), $4,000,
       ``(ii) in the case of a taxpayer not described in clause 
     (i) whose adjusted gross income for the taxable year does not 
     exceed $80,000 ($160,000 in the case of a joint return), 
     $2,000, and
       ``(iii) in the case of any other taxpayer, zero.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to payments made in taxable years beginning after 
     December 31, 2005.

     SEC. 117. STATE AND LOCAL GENERAL SALES TAXES.

       (a) In General.--Subparagraph (I) of section 164(b)(5) 
     (relating to application of paragraph) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

 TITLE II--EXTENSIONS OF CERTAIN PROVISIONS FOR 2 ADDITIONAL YEARS AND 
                          OTHER MODIFICATIONS

     SEC. 201. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS.

       (a) Extension of Termination Date.--Subsection (h) of 
     section 198 (relating to termination) is amended by striking 
     ``December 31, 2005'' and inserting ``December 31, 2007''.
       (b) Petroleum Products Treated as Hazardous Substance.--
     Paragraph (1) of section 198(d) (relating to hazardous 
     substance) is amended by striking ``and'' at the end of 
     subparagraph (A), by striking the period at the end of 
     subparagraph (B) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(C) any petroleum product (as defined in section 
     4612(a)(3)).''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to expenditures paid or incurred after December 
     31, 2005.

     SEC. 202. CONTROLLED FOREIGN CORPORATIONS.

       (a) Subpart F Exception for Active Financing.--
       (1) Exempt insurance income.--Paragraph (10) of section 
     953(e) (relating to application) is amended--
       (A) by striking ``January 1, 2007'' and inserting ``January 
     1, 2009'', and
       (B) by striking ``December 31, 2006'' and inserting 
     ``December 31, 2008''.
       (2) Exception to treatment as foreign personal holding 
     company income.--Paragraph (9) of section 954(h) (relating to 
     application) is amended by striking ``January 1, 2007'' and 
     inserting ``January 1, 2009''.
       (b) Look-Through Treatment of Payments Between Related 
     Controlled Foreign Corporations Under the Foreign Personal 
     Holding Company Rules.--Subsection (c) of section 954 
     (relating to foreign personal holding company income) is 
     amended by adding at the end the following new paragraph:
       ``(6) Look-thru rule for related controlled foreign 
     corporations.--
       ``(A) In general.--For purposes of this subsection, 
     dividends, interest, rents, and royalties received or accrued 
     from a controlled foreign corporation which is a related 
     person shall not be treated as foreign personal holding 
     company income to the extent attributable or properly 
     allocable (determined under rules similar to the rules of 
     subparagraphs (C) and (D) of section 904(d)(3)) to income of 
     the related person which is not subpart F income. For 
     purposes of this subparagraph, interest shall include 
     factoring income which is treated as income equivalent to 
     interest for purposes of paragraph (1)(E). The Secretary 
     shall prescribe such regulations as may be appropriate to 
     prevent the abuse of the purposes of this paragraph.
       ``(B) Application.--Subparagraph (A) shall apply to taxable 
     years of foreign corporations beginning after December 31, 
     2005, and before January 1, 2009, and to taxable years of 
     United States shareholders with or within which such taxable 
     years of foreign corporations end.''.

     SEC. 203. CAPITAL GAINS AND DIVIDENDS RATES.

       Section 303 of the Jobs and Growth Tax Relief 
     Reconciliation Act of 2003 is amended by striking ``December 
     31, 2008'' and inserting ``December 31, 2010''.

     SEC. 204. SAVER'S CREDIT.

       Subsection (h) of section 25B (relating to elective 
     deferrals and IRA contributions by certain individuals) is 
     amended by striking ``December 31, 2006'' and inserting 
     ``December 31, 2008''.

     SEC. 205. INCREASED EXPENSING FOR SMALL BUSINESS.

       Subsections (b)(1), (b)(2), (b)(5), (c)(2), and 
     (d)(1)(A)(ii) of section 179(b) (relating to election to 
     expense certain depreciable business assets) are each amended 
     by striking ``2008'' and inserting ``2010''.

                      TITLE III--OTHER PROVISIONS

     SEC. 301. CLARIFICATION OF TAXATION OF CERTAIN SETTLEMENT 
                   FUNDS.

       (a) In General.--Subsection (g) of section 468B (relating 
     to clarification of taxation of certain funds) is amended to 
     read as follows:
       ``(g) Clarification of Taxation of Certain Funds.--
       ``(1) In general.--Except as provided in paragraph (2), 
     nothing in any provision of law shall be construed as 
     providing that an escrow account, settlement fund, or similar 
     fund is not subject to current income tax. The Secretary 
     shall prescribe regulations providing for the taxation of any 
     such account or fund whether as a grantor trust or otherwise.
       ``(2) Exemption from tax for certain settlement funds.--An 
     escrow account, settlement fund, or similar fund shall be 
     treated as beneficially owned by the United States and shall 
     be exempt from taxation under this subtitle if--
       ``(A) it is established pursuant to a consent decree 
     entered by a judge of a United States District Court,
       ``(B) it is created for the receipt of settlement payments 
     as directed by a government entity for the sole purpose of 
     resolving or satisfying one or more claims asserting 
     liability under the Comprehensive Environmental Response, 
     Compensation, and Liability Act of 1980,
       ``(C) the authority and control over the expenditure of 
     funds therein (including the expenditure of contributions 
     thereto and any net earnings thereon) is with such government 
     entity, and
       ``(D) upon termination, any remaining funds will be 
     disbursed to such government entity for use in accordance 
     with applicable law.
     For purposes of this paragraph, the term `government entity' 
     means the United States, any State or political subdivision 
     thereof, the District of Columbia, any possession of the 
     United States, and any agency or instrumentality of any of 
     the foregoing.
       ``(3) Termination.--Paragraph (2) shall not apply to 
     accounts and funds established after December 31, 2010.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to accounts and funds established after the date 
     of the enactment of this Act.

     SEC. 302. MODIFICATION OF ACTIVE BUSINESS DEFINITION UNDER 
                   SECTION 355.

       Subsection (b) of section 355 (defining active conduct of a 
     trade or business) is amended by adding at the end the 
     following new paragraph:

[[Page 27781]]

       ``(3) Special rule relating to active business 
     requirement.--
       ``(A) In general.--In the case of any distribution made 
     after the date of the enactment of this paragraph and before 
     December 31, 2010, a corporation shall be treated as meeting 
     the requirement of paragraph (2)(A) if and only if such 
     corporation is engaged in the active conduct of a trade or 
     business.
       ``(B) Affiliated group rule.--For purposes of subparagraph 
     (A), all members of such corporation's separate affiliated 
     group shall be treated as one corporation. For purposes of 
     the preceding sentence, a corporation's separate affiliated 
     group is the affiliated group which would be determined under 
     section 1504(a) if such corporation were the common parent 
     and section 1504(b) did not apply.
       ``(C) Transition rule.--Subparagraph (A) shall not apply to 
     any distribution pursuant to a transaction which is--
       ``(i) made pursuant to an agreement which was binding on 
     the date of the enactment of this paragraph and at all times 
     thereafter,
       ``(ii) described in a ruling request submitted to the 
     Internal Revenue Service on or before such date, or
       ``(iii) described on or before such date in a public 
     announcement or in a filing with the Securities and Exchange 
     Commission.

     The preceding sentence shall not apply if the distributing 
     corporation elects not to have such sentence apply to 
     distributions of such corporation. Any such election, once 
     made, shall be irrevocable.
       ``(D) Special rule for certain pre-enactment 
     distributions.--For purposes of determining the continued 
     qualification under paragraph (2)(A) of distributions made 
     before the date of the enactment of this paragraph as a 
     result of an acquisition, disposition, or other restructuring 
     after such date and before December 31, 2010, such 
     distribution shall be treated as made after the date of the 
     enactment of this paragraph for purposes of applying 
     subparagraphs (A) through (C) of this paragraph.''.

     SEC. 303. VETERANS' MORTGAGE BONDS.

       (a) All Veterans Eligible for State Home Loan Programs 
     Funded by Qualified Veterans' Mortgage Bonds.--
       (1) In general.--Paragraph (4) of section 143(l) (defining 
     qualified veteran) is amended--
       (A) by striking ``at some time before January 1, 1977'' in 
     subparagraph (A), and
       (B) by striking subparagraph (B) and inserting the 
     following:
       ``(B) who applied for the financing before the date 25 
     years after the last date on which such veteran left active 
     service.''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply to financing provided after the date of the 
     enactment of this Act.
       (b) Revision of State Veterans Limit.--
       (1) In general.--Subparagraph (B) of section 143(l)(3) 
     (relating to volume limitation) is amended to read as 
     follows:
       ``(B) State veterans limit.--
       ``(i) In general.--A State veterans limit for any calendar 
     year is the amount equal to--

       ``(I) $53,750,000 for the State of Texas,
       ``(II) $66,250,000 for the State of California,
       ``(III) $25,000,000 for the State of Oregon,
       ``(IV) $25,000,000 for the State of Wisconsin, and
       ``(V) $25,000,000 for the State of Alaska.

       ``(ii) Phasein.--In the case of calendar years beginning 
     before 2010, clause (i) shall be applied by substituting for 
     each of the dollar amounts therein by the applicable 
     percentage. For purposes of the preceding sentence, the 
     applicable percentage shall be determined in accordance with 
     the following table:

                                                             Applicable
``Calendar Year:                                         percentage is:
  2006......................................................20 percent 
  2007......................................................40 percent 
  2008......................................................60 percent 
  2009......................................................80 percent.

       ``(iii) Termination.--The State veterans limit for any 
     calendar year after 2010 is zero.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to bonds issued after December 31, 2005.

     SEC. 304. CAPITAL GAINS TREATMENT FOR CERTAIN SELF-CREATED 
                   MUSICAL WORKS.

       (a) In General.--Subsection (b) of section 1221 (relating 
     to capital asset defined) is amended by redesignating 
     paragraph (3) as paragraph (4) and by inserting after 
     paragraph (2) the following new paragraph:
       ``(3) Sale or exchange of self-created musical works.--At 
     the election of the taxpayer, paragraphs (1) and (3) of 
     subsection (a) shall not apply with respect to any sale or 
     exchange before January 1, 2011, of musical compositions or 
     copyrights in musical works by a taxpayer described in 
     subsection (a)(3).''.
       (b) Limitation on Charitable Contributions.--Subparagraph 
     (A) of section 170(e)(1) is amended by inserting 
     ``(determined without regard to section 1221(b)(3))'' after 
     ``long-term capital gain''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to sales and exchanges in taxable years beginning 
     after the date of the enactment of this Act.

     SEC. 305. VESSEL TONNAGE LIMIT.

       (a) In General.--Paragraph (4) of section 1355(a) (relating 
     to qualifying vessel) is amended by inserting ``(6,000, in 
     the case of taxable years beginning after December 31, 2005, 
     and ending before January 1, 2011)'' after ``10,000''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 306. MODIFICATION OF SPECIAL ARBITRAGE RULE FOR CERTAIN 
                   FUNDS.

       In the case of bonds issued after the date of the enactment 
     of this Act and before August 31, 2009--
       (1) the requirement of paragraph (1) of section 648 of the 
     Deficit Reduction Act of 1984 (98 Stat. 941) shall be treated 
     as met with respect to the securities or obligations referred 
     to in such section if such securities or obligations are held 
     in a fund the annual distributions from which cannot exceed 7 
     percent of the average fair market value of the assets held 
     in such fund except to the extent distributions are necessary 
     to pay debt service on the bond issue, and
       (2) paragraph (3) of such section shall be applied by 
     substituting ``distributions from'' for ``the investment 
     earnings of'' both places it appears.

  The SPEAKER pro tempore. After 1 hour of debate on the bill, as 
amended, it shall be in order to consider the further amendment printed 
in House Report 109-330, if offered by the gentleman from New York (Mr. 
Rangel) or his designee, which shall be considered read, and shall be 
debatable for 1 hour, equally divided and controlled by the proponent 
and an opponent.
  The gentleman from California (Mr. Thomas) and the gentleman from New 
York (Mr. Rangel) each will control 30 minutes of debate on the bill.
  The Chair recognizes the gentleman from California.
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, this is a bill that does not deserve the kind of 
rhetoric that is being delivered so far, at least that which I have 
heard on the rule. This bill consists of extending current tax 
provisions. It virtually breaks no new ground. It merely retains those 
structures supported in committee, for example, in a bipartisan way, to 
allow people to continue to utilize current tax privileges.
  I have a hard time when I listen to the rhetoric associated with the 
description of this bill when one of the provisions, for example, is 
the authority to issue qualified zone academy bonds for school 
modernization, equipment in high-poverty areas. I cannot believe my 
colleagues on the other side of the line are opposed to that. Above-
the-line deduction for higher education expenses, in opposing this 
bill, I guess they are opposed to that. Continue the deduction for 
State and local sales taxes due to expire, I guess they are opposed to 
that.
  I could go through and point out a number of items. For example, the 
work opportunity tax credits for hiring individuals who face barriers 
to employment, in addition to the extension. The age limit for eligible 
food stamp recipients is increased from 25 to 35. Maybe they are 
opposed to that.
  I guess when we go through and examine these various provisions, if 
those are items that are reserved for the rich, the millionaires and 
the privileged, I guess I just do not understand it.
  But they are required to attack any bill that allows Americans to 
hang on to their own hard-earned money. That is just kind of 
fundamental, I guess.
  My concern is if they are going to produce the kind of rhetoric they 
are producing on a piece of tax legislation which simply extends 
current law, what are they going to do when we have to rethink the way 
in which we tax people today to make sure that we do not destroy the 
economic engine in this country that produces the quality of life-style 
for each and every American?
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I welcome the opportunity to join with the Republicans 
to send this holiday message to millions of Americans that will be 
affected by this bill, especially to the fraction of 1 percent that 
would be the beneficiaries of a substantial reduction in capital gains 
and corporate dividends. It is true, while this only represents 20 to 
25 percent of the bill, it should be made abundantly clear that these 
benefits would not be effective until sometime in 2009 and 2010.
  Now, I am here on the floor to try to get people to understand that 
this tax cut for the rich is really to grow the economy, and I want to 
make it clear to those people who have lost their jobs

[[Page 27782]]

and not counted among the unemployed, those that are looking at 
automobile plants closing and airlines going bankrupt, that basically 
the economy is good, and it is good because the President told us so. 
And if they do not think that we are moving forward fast enough, then 
they ought to really listen to the President as he shares with us the 
great economic recovery that has happened in Iraq, and if they are just 
a little patient, things will get better here in the United States.
  Now, we all know that whenever we give this type of tax cut that 
there is going to be a tremendous revenue loss, and in the last few 
days, that revenue loss has been something like $100 billion. But fear 
not, because we are not charging all of this to the deficit. It is true 
that as the deficit increases more than history ever expected under 
this administration, that soon 40 percent of the tax revenues that we 
get will be going just to pay the interest on this outstanding debt, 
and that is why our Republican friends believe that we just cannot 
expand the deficit, that we have to cut spending.
  Now, they have looked all over to the to decide where to do the 
cutting. And in this holiday season, I just want to join them in 
letting people know where these cuts are going to take place. But I do 
not want people to worry about it because the President says that the 
economy is booming and the Republicans here say that the tax cuts for 
the rich is for economic growth. So how can one be against that 
formula?
  First of all, if one is a mother trying to raise her children and she 
got support from the local and State government to go after the father, 
or whatever the case may be, to get that money to take care of her and 
her family, not to worry, that this is going to be cut and she will not 
be able to get the money because under this bill, whether people know 
it or not, it is for economic growth.

                              {time}  1145

  Say you are considering using food stamps for your Christmas meal. 
You find out that the food stamps are going to be cut. Not to worry, 
because soon there will be economic growth.
  Maybe you are just a student trying to get a student loan, and you 
really think that you should get some help from your government 
because, after all, we want you to be productive and make a 
contribution to society. Not to worry, these tax cuts are for economic 
growth.
  What I do not understand, with all of the opportunity that we have 
had to take care of economic growth, why do we wait until this time of 
the season and target the least among us in order to do the budget 
cuts?
  It is not as though we do not have $2 or $3 billion in terms of 
expenses in Iraq, which if you did not know lately, you should know 
that victory is in sight and we are winning that too. So we do not want 
you to lose confidence in all of government. If you find out that this 
bill rewards the richest of the people in the United States whose 
income is not going to be adversely affected, or their tax is adversely 
affected for 3 or 4 years, but we have to do something to target the 
poor today, then you have to have some trust in the Republicans, 
because they say we have got to have victory in war, we have got to 
grow the economy, and this is the best thing that ever happened to you.
  Now, the Democrats are not just saying vote ``no.'' We will have an 
opportunity for Members to vote ``yes.'' And unlike the Republicans, we 
thought enough of the alternative minimum tax to include it in 
reconciliation. What does that mean? It means it is protected when it 
gets over to the other side, so we did not have to depend on 100 
Senators sitting down and not objecting. It is in our bill. All of the 
good things that can come out of a bill, we have included, including 
relief for those people that have State taxes.
  And so, my friends in this holiday season, you may find it very 
difficult if you are unemployed, if you are concerned about the 
economy, or the cuts that we have, including Medicaid, which is only a 
$10 billion cut, but you must trust the majority and the Republicans in 
this House, because they, like the President of the United States, say 
the economy is booming. We are going to have victory in the Middle 
East, and this is going to make it easier for you, if not today, if not 
tomorrow, then sometime in the future.
  Mr. Speaker, I reserve the balance of my time.
  Mr. THOMAS. Mr. Speaker, I yield myself 30 seconds.
  Mr. Speaker, perhaps the gentleman from New York (Mr. Rangel) is not 
aware that the Senate has included the alternative minimum tax in their 
reconciliation tax package. They have already voted on it. So there is 
no need to provide any assurance from the House side, because the 
Senate has already included it. But, again, that is reality.
  The economy is not good because the President told us so. Leading 
economic indicators tell us so: the unemployment numbers, the 
productivity numbers. The real problem with my friends on the other 
side of the aisle is that if reality does not coincide with their 
rhetoric, they choose rhetoric rather than reality.
  Mr. Speaker, I yield 2\1/2\ minutes to the gentlewoman from 
Connecticut (Mrs. Johnson).
  Mrs. JOHNSON of Connecticut. Mr. Speaker, I rise today in support of 
the Tax Relief Extension Act. Let me make absolutely clear what this 
bill does. The bill will prevent automatic tax increases on millions of 
Americans and their families.
  Unless Congress acts, individuals will pay higher taxes on their 
savings; businesses will lose valuable incentives to provide research 
in the United States; small businesses will lose the ability to expense 
new equipment, essential to the support of new employees.
  These are all benefits taxpayers have today, and our bill simply 
preserves them. The bill does not increase taxes. The bill does not 
reduce taxes. The bill merely preserves the current tax policy that has 
driven 4.3 percent growth and is creating millions of new jobs.
  According to the IRS in my home State of Connecticut, there are 
550,000 taxpayers who receive dividend income; 153,000 of those have 
incomes below $30,000 a year. Right now they pay 5 percent taxes on 
dividend incomes. In 2008 low-income taxpayers will pay zero taxes on 
dividend income. If we fail to act, however, they will pay taxes as 
high as 25 percent.
  A widow living on $30,000 a year could see her tax bill increase by 
$1,200 a year. That would be wrong. This bill needs to be passed. It 
deserves to be passed. It also needs to be passed and deserves to be 
passed because it extends and enhances the R&D tax credit. At a time 
when other nations are providing or have provided permanent and richer 
incentives for research, we need to recognize the job-producing 
benefits of this tax credit.
  Mr. Speaker, we remain a world leader in patents and discoveries, but 
other nations are closing in. Advances in technology and innovation are 
what drive growth and ultimately create higher standards of living for 
all of us.
  We need to ask ourselves, do we want the next major scientific 
breakthrough to happen in Germany or China? Do we want other countries 
to be the leaders in the patents for the next generation of technology?
  Finally, I would be remiss if I failed to mention incentives for 
small business expensing. Small business is the engine of our economy. 
Our bill allows small businesses to immediately expense up to $100,000 
of equipment. When we first adopted this provision, we saw investment 
in equipment skyrocket, go right straight up. Lowering the cost of 
capital encourages small businesses to invest in machines, trucks, and 
other equipment and hire new people. With 25 million small businesses 
accounting for two of three new jobs created, expensing supports these 
small businesses.
  Mr. Speaker, I urge passage of this legislation.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would just like to say briefly, if the chairman of the 
Ways and Means Committee is saying that the alternative minimum tax is 
in the other body's bill, then he must be saying that the tax cuts that 
we are talking about today are not in the other body's bill.

[[Page 27783]]

  So it is 3-card Molly. The House Republicans passed both of them, one 
on the Suspension Calendar that is not protected here, but is protected 
in the other body; and this bill which provides for relief for the 
taxes for corporate dividends and capital gains, which is protected in 
our bill, but is not in their bill.
  And so what we are doing is shooting dice to see which one will 
prevail.
  Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from Washington 
(Mr. McDermott).
  Mr. McDERMOTT. Mr. Speaker, I got up this morning and here is the 
Washington Post's eminent columnist, David Broder. He begins his story: 
``If the House of Representatives were a person, it would be blushing 
these days. Unfortunately, the House is beyond embarrassment.''
  Now, I used this before, but I wanted to bring it out here again 
because I think we need to demonstrate to people what is going on. We 
have Christmastime, and we have socks. We have poor people's socks and 
rich people's socks. And the rich people need $100 billion in tax cuts.
  The Republicans, for whatever reason, have decided that it is $100 
billion yesterday and today, $100 billion. Now where do you get the 
money for that? Well you have to cut somebody to get it. You have got 
to cut something, or else you are going to drive up the deficit.
  So the first thing you do is take child care away from 300,000 
children. And you put that in the sock, the stocking of the rich. And 
then you have Social Security, SSI benefits for the disabled and the 
elderly. And you take $700 million away from them and put it into the 
rich folks' stocking.
  And then you come to child support enforcement. We do not want 
children who are in divorced families to get money from those deadbeat 
dads. That is not what the Republicans say. They say, let us save $21 
billion. We will take it away from the children in divorces and put it 
in the rich people's stocking.
  And Medicaid. Oh, well, they do not need health care. Why, there is 
$10 billion we can take away from poor people's health care and put it 
in the rich people's stocking.
  And then there is student loans, $14 billion from college students. 
We are going to load it on them. That is the middle class. That is the 
lower-class people who are trying to get through on loans. We take 
their loans and we say, no, no, no, no, the rich people need it.
  And then we have one of the best ones of all: food stamps. Let us 
take food stamps away from 300,000 people; 300,000 people getting food 
stamps. Oh, these are the rich. Oh, but we have to cut them. We have to 
take this away from them.
  You cannot have food stamps, poor people or ordinary people; we got 
to give a tax break to the rich people. And then finally we have foster 
children. Way down here in the bottom of the sock. We have $600 million 
taken away from the program that we took those children out of another 
family and took responsibility for. We have taken these children away 
from a family we have accepted responsibility for in this foster care 
payment, and we cut it and we give it to the rich folks.
  Now, you kind of wonder what might be left down here for the poor 
people. Well, look at that. A lump of coal. The poor people better save 
that lump of coal, because there is nothing in here for their heating 
bills, the LIHEAP program has not been expanded, and all they are going 
to have to heat their house is the lump of coal that the Republicans 
put in the poor people's sock.
  Merry Christmas. I certainly hope you enjoy all the festivities. This 
is a bad bill. Vote ``no.''
  Mr. THOMAS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Wisconsin (Mr. Ryan) to explain to the gentleman from Washington that 
it is not a zero sum game that is what has made the American standard 
of living.
  Mr. RYAN of Wisconsin. Mr. Speaker, I appreciate the gentleman 
yielding me time.
  I also appreciate the fact that the gentleman from Washington is 
willing to acknowledge Christmas here on the House floor. That is a 
nice step in the right direction.
  Mr. Speaker, let us look at the facts. To hear the other side, you 
would think we were taking a chain saw to the budget. What we are 
proposing in the budget is that we increase entitlement spending 6.3 
percent instead of 6.4 percent, saving $50 billion out of a $14 
trillion budget, by rooting out waste, fraud and abuse by reforming 
government.
  But let us talk about these tax cuts. You would think when we cut 
taxes in 2003 we would have lost revenues. Right? That is the intuitive 
thing to say. Wrong. That is not what happened. Since the enactment of 
the 2003 tax cuts, job losses went away. The unemployment rate was 6.1 
percent when we cut taxes. The unemployment rate is 5 percent.
  Since we cut taxes, we have averaged a job creation every month of 
148,000 jobs. Just last month alone we added 215,000 jobs to the 
economy. What happened before we cut taxes? Before we cut taxes, the 2 
years before the tax cut, our economy grew at an average of 1.1 
percent. How fast is the economy growing since the tax cuts? 4.1 
percent. How fast did the economy grow last quarter? 4.3 percent.
  Now, Mr. Speaker, what has happened since we cut taxes is we have 
reversed the job loss, we have reversed the decline in jobs, and we 
have added 4.4 million jobs to the American economy since the 2003 tax 
cuts.
  What happened to revenues? Revenues increased. Yes, that is right. At 
these lower tax rates, at these lower taxes, we increased revenues to 
the Federal Government. Last year revenues went up 14 percent. Just 
this year individual income tax receipts are up 14 percent. Corporate 
income tax receipts are up 47 percent.
  What happened to the deficit, Mr. Speaker? The deficit projection in 
2004 was $521 billion. What is the deficit now? The deficit projection 
now is $319 billion. We dropped the deficit 23 percent last year. We 
dropped the deficit 25 percent last year. The deficit is down because 
tax revenues are up.
  Do not defeat this bill and raise taxes. Let's stop tax increases.

                              {time}  1200

  Mr. RANGEL. Mr. Speaker, I would like to ask the gentleman just one 
question on my time.
  These very important tax cuts or extension of tax cuts you are 
talking about, could you share with me as simply as possible as to when 
they expire, what year?
  Mr. RYAN of Wisconsin. Each of these tax cuts expire between this 
year and the next 2 years. It depends on the tax cut you are talking 
about.
  Mr. RANGEL. The tax cut that we are talking about is the $20 billion 
in capital gains and corporate dividends. Does that not expire in 2009?
  Don't get rattled.
  Mr. RYAN of Wisconsin. Not at all.
  Mr. RANGEL. It is just a simple question. Because there seems to be 
some degree of urgency in this and unless it is a projected gift, then 
these things don't expire this year or next year.
  Mr. RYAN of Wisconsin. If the gentleman will allow me to respond to 
his question.
  Mr. RANGEL. Please.
  Mr. RYAN of Wisconsin. Why is it important that we continue the tax 
relief progress that would expire in 2008 on dividends and capital 
gains? Because those are job creators.
  Mr. RANGEL. I think the gentleman has answered the question. There is 
no urgency in this. You just want to give a projected Christmas gift to 
the very wealthy. So I need some help on this. If I can't get answers 
from you, I will get someone that can give answers.
  Mr. Speaker, I yield 3 minutes to the gentleman from Massachusetts 
(Mr. Neal) to answer some of these important questions, a distinguished 
and acknowledged expert in this on the Ways and Means Committee.
  Mr. NEAL of Massachusetts. Mr. Speaker, I just heard the gentleman 
from Wisconsin talk about job creation. He singled out one month. 22 
million jobs created during the Clinton years. 22 million. Economic 
growth has been paltry and everybody knows it. In addition to which he 
talked about the

[[Page 27784]]

deficit--with a straight face. They have rolled up the national 
deficit, $2.2 trillion we are in the hole. On their time this has 
happened.
  Let me say this and I think it is very important to point out, Mr. 
Speaker, the Republican majority now says, as they did yesterday with a 
straight face, incidentally, well, the Democrats did not do anything 
about the alternative minimum tax when they were in the majority. In 
1994, and I hope that anybody who is listening to this will write this 
number down, when the Republicans took control of the House of 
Representatives there were approximately 200,000 people paying AMT, 
200,000 people. Next year 19.3 million people are kicked into AMT.
  I would like to think, as the gentleman from New York has indicated, 
that I have had some consistency on the issue of alternative minimum 
tax, not only in the committee, but here on the House floor. We did a 
big nothing yesterday about AMT and everybody knows it. 19.3 million 
people next year are kicked into AMT. But the House of Representatives 
had time to repeal the estate tax and now to address the dividend and 
capital gains tax, but they really never have time to do anything about 
AMT. And the reason they do not have time to do anything about AMT is 
pretty simple, it goes to middle income Americans to bear that burden.
  So if we do not have time here to do something for the wealthy, we 
really do not have time to do anything. We are rich and we are not 
going to take it anymore. We watch these numbers as they are presented 
to us. The Republican party, at one time, stood for anti-Communism and 
balanced budgets. Well, Communism is gone and the deficits have really 
soared, all from a party that preaches fiscal discipline. They have 
rolled those deficits up for one reason, after, by the way, robbing the 
Social Security trust fund to pay for tax cuts for the wealthiest. In 
this institution we hear, well, the Social Security trust fund is going 
broke. It is going broke because they took $2 trillion out of it in tax 
cuts during the next 10 years. There is no pressure to do what we have 
to do today. They are contributing to the national deficit, 
contributing to the debt, all under the guise of paying for tax cuts 
for the wealthiest among us.
  Lastly, I defy anybody here to not acknowledge this static. The 
dividend relief bill that we are entertaining here overwhelmingly 53 
percent of that benefit goes to people who made more than $1 million 
last year. That is where we find ourselves now.
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume to 
ask a rhetorical question.
  If the gentleman from Massachusetts (Mr. Neal) voted yes on this 
alternative minimum tax bill yesterday he either was protecting the 
very rich in Massachusetts.
  Mr. NEAL of Massachusetts. Will the gentleman yield?
  Mr. THOMAS. No, it is a rhetorical question.
  Mr. NEAL of Massachusetts. I am happy to participate.
  Mr. THOMAS. Whose time is it, Mr. Speaker?
  The SPEAKER pro tempore (Mr. Gingrey). The gentleman from California 
(Mr. Thomas) has the time.
  Mr. THOMAS. Either he was voting to protect the incomes of the very 
rich in Massachusetts or he exercised a futile procedure.
  There were four Members of his party who voted no. He had an 
opportunity, if he believed it was not real to vote no. He voted yes. 
The problem is they always want it both ways.
  Mr. Speaker, I yield 2\1/2\ minutes to the gentlewoman from 
Pennsylvania (Ms. Hart), a member of the committee.
  Ms. HART. Mr. Speaker, I thank the chairman for yielding me time.
  Mr. Speaker, I rise in support of H.R. 4297 because this legislation 
will ensure that our economy will continue to expand. That is right, 
expand.
  If you would listen to those on the other side of the aisle, you 
would think that we are in a shrinking economy. However, since the 
capital gains and dividend taxes were reduced in 2003, we have seen ten 
straight quarters of what is it? Growth.
  Now, what does growth mean? It means more jobs. It means more 
opportunity. I spoke recently with an entrepreneur group back home, 
women who started businesses in their homes. Most of them have children 
and did not want to be out of the house all the time, very small 
businesses. And you know what they said to me their top priority is? 
Make sure you extend the capital gains cuts. Make sure you make sure 
you pass legislation that will prevent a tax increase.
  That is what we are doing today. Preventing a tax increase on these 
entrepreneurs who, one by one, are creating new jobs in our economy. 
The national economy has produced impressive growth. Our pro-growth 
policy will continue only if we do not increase taxes. In the 10 
quarters prior to the passage of this legislation, we averaged just 1.2 
percent of growth, never exceeded 2.9. In the 10 quarters since, we 
have averaged 3.3 percent of growth and have averaged over 4 percent. 
Now, I think 4 percent growth is better than 1 percent growth. And if 
we do not continue this tax situation and increase taxes, we will see 
our growth go away.
  What does this mean, this business investment that happens because of 
the capital gains reduction, the dividends reduction? It means new 
jobs. In a district like mine where we need new jobs, and I know some 
Members on the other side of the aisle apparently have more jobs than 
they need, we need jobs. This climate is the climate we need for 
growth. We have seen, in fact, unemployment go from 6.1 percent down 
over 1 point to 5 percent.
  Despite challenges that this country has faced over the last couple 
of years, including terrorist attacks and natural disasters, we have 
still seen an increase of job creation.
  Now, if anybody at the end of August and the beginning of September 
expected that we would see 215,000 jobs created in the United States in 
the last month, I do not think you are telling me the truth. But the 
good climate that was created by those cuts made it happen.
  We need to continue good policy. We need to realize what good policy 
is. Good policy is allowing the people to invest their money, create 
jobs, create a strong economy and create job growth. I urge my 
colleagues to continue this situation and not allow a tax increase on 
the American public.
  Mr. THOMAS. Mr. Speaker, I yield the remainder of my time to the 
gentleman from Michigan, the chairman of the Select Revenue 
Subcommittee, and ask unanimous consent that Mr. Camp control the 
remainder of my time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. RANGEL. Mr. Speaker, I yield 30 seconds to the gentleman from 
Massachusetts (Mr. Neal) to give a rhetorical response to the 
chairman's question.
  Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman from 
New York (Mr. Rangel) for yielding me time.
  The chairman did raise a rhetorical question. Let me give a 
rhetorical answer.
  We are all so desperate here after these 10 years of Republican rule 
to do something about AMT we are prepared to vote for any procedure 
that comes before this institution just to hopefully move it along.
  Remember, when the Republicans took control, 200,000 people were 
paying AMT. Next year 19.3 million people will be paying alternative 
minimum tax.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from 
North Dakota (Mr. Pomeroy), a distinguished member of the Ways and 
Means Committee.
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding.
  The preceding speaker on the Republican side said we have got to pass 
this, we have got to continue the pro-growth policies. She was talking 
specifically as she referenced capital gains and dividends. Well, the 
fact is the very tax cuts that she is talking about remain in place. 
They are in existing law for 2006, for 2007, for 2008. Doing nothing 
keeps the very provisions she was

[[Page 27785]]

hyperventilating about just a moment ago.
  But what is the matter then? If we got them and we got them through 
2008, why not kick them out through 2009 and 2010? This is the reason. 
This is the national debt. This fall it went north of $8 trillion.
  I brought this chart to illustrate what a huge burden we are racking 
up for our children. This averages out to $27,000 of debt per person. 
And in this environment, the majority in bringing this bill to the 
floor today after yesterday's vote will be passing $87 billion in 
additional tax cuts that are not paid for.
  Alan Greenspan has got some words of caution on this. He was quoted 
in November saying, We should not be cutting taxes by borrowing. Well, 
when they do not pay for their tax cuts, they are basically borrowing, 
leaving the debt to our children to offset the funding of these tax 
cuts, just what Greenspan warns against.
  Earlier in the month of December, just last week, he says, An 
expected deficit casts an ever larger shadow over the growth of living 
standards. In the end, the consequences for the U.S. economy could be 
severe.
  The dirty little secret in this budget reconciliation plan is that it 
increases borrowing authority for this country nearly $1 trillion, from 
750 to $780 billion of additional debt they will be authorizing to fund 
the tax cuts that they want to commence.
  As they talk about growth, don't believe it. They would not have to 
increase the borrowing limit to this country if this all worked. They 
are adding to the debt to pass tax cuts disproportionately for the 
wealthiest.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Indiana (Mr. Chocola), a distinguished member of the Ways and Means 
Committee.
  Mr. CHOCOLA. Mr. Speaker, imagine if we could bring a piece of 
legislation to the floor of this House that would, over the next 30-
month period of time, result in benefits that every American could 
share in. Things like increasing business investments by 25 percent, 
growing the value of the stock market by over $4 trillion. Creating 4.4 
million new jobs. Reducing the unemployment from 6.3 to 5 percent. 
Having quarterly GDP grow at an average of 4.1 percent. Increase tax 
receipts by $274 billion over a 12-month period of time, a 15 percent 
increase, the largest in 25 years. And decrease the deficit over that 
same 12-month period of time by over $100 billion.
  Mr. Speaker, it would be hard to imagine that we would not all 
support that, but I guess it is not hard to imagine, given the 
conversation here today, but that is exactly what this body did when we 
passed tax relief in 2003. And today we are simply extending these pro-
growth tax policies that have led to this historic economic growth.
  I think, Mr. Speaker, we all understand the benefit of hindsight and 
history is full of valuable lessons. I encourage my colleagues to use 
the benefits of hindsight and the facts of history to support this tax 
relief extension today and the policies that led undeniably to 
opportunities of growth and prosperity for every single American. 
Because not to do so, Mr. Speaker, is the thing that would be truly 
hard to imagine.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas (Mr. Doggett), a distinguished member of the Ways and Means 
Committee.
  Mr. DOGGETT. Mr. Speaker, when this administration took over the 
White House, the United States enjoyed a multi-billion dollar budget 
surplus. But a Republican-controlled Congress proved unable to stay the 
course. Instead, our public surplus has been surrendered--surrendered 
to special interests and their corrupt coterie of cronies.
  Every time Big Oil or Halliburton or some other corporation that 
shifts its jobs and its profits offshore comes up here and asks for 
another tax break, this Congress waves the white flag of surrender. The 
commitment to any fiscal discipline is in full retreat. Now we have 
huge deficits as far as the eye can see.

                              {time}  1215

  At a time of war, Republicans demand no sacrifice from those at the 
top, no sacrifice from multinational corporations; and they demand that 
those at the bottom sacrifice their all.
  Under this bill, the few individuals making over $1 million per year 
are rewarded, on the average, with over $50,000 in tax breaks. So those 
at the top, they can add another fancy foreign car to their fleet. But 
for the many who are earning up to $40,000 a year, that is over half of 
the people of the United States, they get an average of $30, maybe 
enough for a full tank of gas.
  Once again, America sees that a true Republican Christmas is one 
where only the silk stockings get stuffed. And when the bill for this 
lavish Christmas give-away comes due, who is going to pay? Our children 
will pick up the tab in the form of endless national debt and with cuts 
to child care, cuts to assistance to abused and neglected children, 
cuts to child support enforcement, and cuts to student financial 
assistance.
  The tax-writing body in this Chamber has truly become the ``Committee 
on Greedy Ways and Shifty Means.'' And this will be remembered as the 
``Cut-and-Run'' Congress, cutting taxes greatly for the few, while 
running trillion-dollar deficits for the rest of us.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Pennsylvania (Mr. English), a distinguished member of the Ways and 
Means Committee.
  Mr. ENGLISH of Pennsylvania. Mr. Speaker, today we have the 
opportunity to pass a bill that I believe will provide a powerful tonic 
for continued economic growth as a precedent for social justice.
  Since 2003, when much of the current tax policies were enacted, our 
GDP has seen its fastest growth in 20 years, averaging a robust 4.4 
percent growth per quarter. This growth, Mr. Speaker, is attributable 
in part to reduced rates on capital gains and dividends.
  I would like to highlight who in the real world is receiving these 
reduced rates and, therefore, whose taxes we will be raising if we fail 
to extend these existing policies.
  Mr. Speaker, 54 percent of those families receiving dividend income 
had incomes of less than $75,000, and they received an average of 
$1,400 in dividends. Today, families with incomes under $100,000 have 
more than $20 billion in dividend income. In 2005, an estimated 10.3 
million families in the 10 and 15 percent tax brackets will save on 
their taxes because of the existing tax policies.
  So the rhetoric that this tax relief only benefits the wealthy is 
vacant, ideological posturing.
  To let these rates expire would simply be a tax increase on the 
productive sector of the American economy. Not only would the lapse of 
the reduced rates impose a tax increase; it would particularly 
discourage equity ownership among working families, among whom we have 
seen a 91 percent increase in stock ownership.
  To turn back the clock on our tax policies that have benefited 
American workers and encourage more American workers to own a stake in 
their future is simply the wrong thing to do.
  Mr. Speaker, those who oppose this legislation are asking for a 
perverse tax increase on the seed corn of our economy and are 
suggesting that we impose a drag on economic growth at a time when we 
need it the most. We cannot afford not to pass this legislation today 
if we are serious about growing our economy.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Thompson), a distinguished member of the Ways and Means 
Committee.
  Mr. THOMPSON of California. I thank the gentleman for yielding.
  Mr. Speaker, just 2 weeks ago, the majority came down to the floor 
and cut $50 billion from services for middle-class workers, students, 
hungry children, farmers, and single moms. Today, they are back with 
part two, pushing almost $60 billion in tax breaks for Americans who 
need help the least. Sadly, they are trying to peddle this as deficit 
reduction.
  Mr. Speaker, you cannot spend $10 billion more than you cut and call 
it

[[Page 27786]]

deficit reduction. Our constituents know that these numbers do not add 
up, and they also know that these priorities do not add up.
  This bill grows the deficit, and it turns a blind eye to the tax 
increase the middle class will face in just another 23 days. That is 
when the relief for the alternative minimum tax, or the AMT, expires. 
If AMT expires, 16 million new families will start paying this tax next 
year. That is a tax increase.
  This is an issue that hits home for my constituents. California is 
hit harder by AMT than any other State in the country. Almost a quarter 
of the revenues that come from the Treasury from AMT come directly from 
California. If AMT relief is not extended, that number will increase.
  This legislation extends tax cuts that are not even close to 
expiring, cuts that are on the books for another 3 years. It changes 
more than 25 different tax provisions; but somehow, our friends in the 
majority could not find room for AMT relief: 16 million new families 
impacted, 23 days until expiration, zero regard for the middle class.
  I urge my colleagues to vote against this irresponsible legislation 
and support the Rangel substitute. The substitute extends immediately-
expiring tax provisions, and it protects our middle-class families from 
AMT.
  Mr. CAMP of Michigan. Mr. Speaker, I yield 2 minutes to the gentleman 
from Florida (Mr. Shaw), a distinguished member of the Ways and Means 
Committee and chairman of the Trade Subcommittee.
  Mr. SHAW. Mr. Speaker, I thank the gentleman from Michigan for 
yielding me this time.
  I have been listening to the debate here on the floor. I have yet to 
hear anybody from the other side say that the reduction in capital 
gains does not stimulate the economy or say that any of these items are 
bad for the economy.
  All we have heard from the other side is class warfare, who is 
getting what. Well, I can tell you who is getting what, and we can go 
down this thing.
  My folks in Florida want to be able to deduct State and local sales 
taxes. What is wrong with that? People in New York, they can deduct 
their income tax. So why can Floridians not deduct their sales tax and 
other States?
  Research and experiment tax credit, who can be against that? It keeps 
us sharp and competitive in the world market.
  Above-the-line deduction for higher education expenses. Are we 
against allowing people to deduct their education expenses?
  How about an above-the-line deduction for out-of-pocket teacher 
classroom expenses, are you against that?
  All we are hearing about is, well, why are you doing it for capital 
gains and how this is going to affect the top people, the people right 
at the top of the income level. I would like to point out who is going 
to benefit from the reduced rate on dividends.
  Nearly 60 percent of the Americans receiving capital gains or 
dividend income have incomes of less than $100,000; and believe me, 
that is not millionaires, and you can even take it down to $50,000 and 
find one in five will benefit from the capital gains deduction because 
of incomes under $50,000. Those are not millionaires, but let us get 
down to talk about why we are doing it now.
  If we were to allow the capital gains rate to expire and jump back up 
and increase, what we are simply doing is pushing back the increase so 
they do not increase. This is very important, and it is important for 
capital formation. It is important for planning your life and future 
and what you are going to be able to do; and also, I think that it is 
just good sense. It is good for our economy. Our economy has grown 
under this structure, and let us let the economy continue to grow.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  I am so glad to hear my friend from Florida talk about the economic 
growth that we can expect by making certain that the capital gains tax 
cut and the corporate dividend tax cut do not expire. What bewilders 
most people is that this does not expire until 2008. Nobody would be 
adversely affected until 2009, and unless the gentleman does not 
believe he will be in the majority in the next few years, I do not see 
why he would have to say that people who are out of work, who are 
looking for work, who have lost their pension should believe that this 
tax cut that will continue to 2009 is going to help them.
  But maybe the gentleman from Mississippi, who understands that not 
many of his constituents are going to understand this, might clarify 
some of the problems we have.
  Mr. Speaker, it is my pleasure to yield 3 minutes to the gentleman 
from Mississippi (Mr. Taylor), who really knows what economic growth 
should be.
  Mr. TAYLOR of Mississippi. Mr. Speaker, I thank the gentleman for 
yielding me time.
  Last night, about 12,000 Mississippians went to bed in somebody 
else's house or in their carport or in their car or in their tent. They 
are waiting on a FEMA trailer. I did not promise them a FEMA trailer. 
The President of the United States did. He has not fulfilled that 
promise yet. It is over 102 days past the storm.
  As we speak, there are tens of thousands of Mississippians, average 
Joes, who are about to lose their house. See, they lived outside the 
flood plain. They had wind insurance, and a storm of magnitude that has 
not occurred in 300 years either destroyed or flooded their homes.
  Now they have no home. They have a mortgage to pay, and their 
insurance company, which contributes heavily to the folks over there, 
says you are not getting a dime because that was water and not wind, 
but they will use any excuse they can.
  I have introduced legislation to try to help those folks, and it is 
expensive. It is going to cost about $5 billion to help those folks 
hang on to their homes and hang on to their mortgage; and in 102 days 
we have not had a hearing or a vote on it. But if you are a member of 
the political contributor class, the guys who write the big checks to 
the RNC, guys who write a big check to a Congressman here, Senator 
there, we have got a vote on your tax cut that does not even expire for 
3 years.
  You want to know what this House's priorities are? It is not with the 
average Joes. It is with the political contributor class. You call them 
what you want. You can call them rich, but we all know it comes down to 
who writes the checks.
  By the way, the guy on Coleman Avenue whose house washed away, he 
does not write big checks. So maybe that is why you do not listen to 
him. It has been 102 days, and you have done nothing. There is no talk 
of doing anything.
  There are 12,000 Mississippians waiting on a FEMA trailer. So what do 
you bring to the floor? Is it hurricane relief? Is it something to help 
the average Joes? It is a tax break for the wealthiest 1 percent of 
America who, by the way, write the big checks to the political parties. 
Tell me your priorities are not screwed up, because I am going to tell 
you they are.
  Mr. CAMP of Michigan. Mr. Speaker, I yield myself such time as I may 
consume.
  I just want to point out to the Members that yesterday the House 
passed the Gulf Opportunities Zone Act 415-4 which dealt with many 
items to help gulf coast area residents who had been hurt by the 
hurricane, incentives to help rebuild housing, investment to provide 
depreciation and expensing for small businesses, bonding authority so 
that tax-exempt bond authority could help rebuild devastated 
infrastructure in the hurricane zone.
  So this House has acted to help hurricane victims.
  Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Arizona 
(Mr. Hayworth), a distinguished member of the Ways and Means Committee.
  Mr. HAYWORTH. Mr. Speaker, I rise in strong support of the 
legislation precisely because of the challenges outlined by my friend 
from Mississippi.
  As my friend from Michigan just pointed out, yesterday this House 
took steps to reignite the engines of economic opportunity, to deal 
with job

[[Page 27787]]

creation and getting help to the people of the gulf coast. I would 
assure this House, Mr. Speaker, this is not some sort of abstraction.
  As my friend from Mississippi knows, Brother Rex Yancey, the pastor 
of First Baptist Church in Pascagoula, is my wife's uncle. This is not 
some sort of statistic or abstraction. Just as Brother Rex and everyone 
in Mississippi and on the gulf coast are facing challenges, we need to 
work together to make sure the climate of economic opportunity exists 
for all.
  Just as heartfelt as his concern is for his constituents, Mr. 
Speaker, I must correct the record. It does this House no service to 
come to this well, no matter the challenges confronted, and try to 
claim either class warfare or crass political opportunism in a quid pro 
quo. It is beneath the dignity of every Member of this House to suggest 
that somehow this has to do with contributions.
  As my friend from Mississippi knows, the most philanthropic State in 
the Union where people step up to help neighbors in need, that example 
does not fall on deaf ears. I will say economic opportunity is 
important, not only for Wall Street, not only for Main Street but for 
your street, Mr. Speaker, for every street because we understand 
economic opportunity is not exclusive.
  There may be some who believe that this modern economy is some sort 
of caste system. There may be some who always want to fill in the blank 
as follows: tax breaks for the blank, tax breaks for the rich. That is 
their story and they are sticking to it. No hope, no opportunity when 
the facts are otherwise.
  We have had solid economic growth. Revenues to the government have 
actually increased.

                              {time}  1230

  And not only has there been some $69 billion in immediate hurricane 
relief given by this Congress and this government to the storm victims, 
but the promise of future help and economic prosperity as the people of 
the gulf coast get back on their feet.
  Stand up for growth and opportunity. Pass this legislation.
  Mr. RANGEL. Mr. Speaker, I had an old law professor, and he once told 
me, if you don't have the facts going for you, raise your voice. I 
never understood it, but I do now.
  Mr. Speaker, I yield 30 seconds to the gentleman from Mississippi 
(Mr. Taylor) to share with us what economic growth means to him under 
this bill.
  Mr. TAYLOR of Mississippi. Mr. Speaker, I want to remind the 
gentleman that when your house is washed away, your job is washed away. 
You are not looking for a tax break. You are looking for your fellow 
Americans to help you out while your kids are serving in the 
Mississippi National Guard over in Iraq.
  You have not done that for 102 days.
  Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
Illinois (Mr. Emanuel), a distinguished Member of the Ways and Means 
Committee.
  Mr. EMANUEL. Mr. Speaker, I rise today in strong opposition to this 
Republican plan for the wealthiest Americans.
  President Kennedy once said, ``To govern is to choose.'' So let us 
look at the choices. This tax cut falls on the heels of a deficit 
reduction plan passed before Thanksgiving that cut children's health 
care, child care assistance, college aid, child support, and will 
actually increase the deficit by $20 billion. That is what they refer 
to as new math in America.
  What kind of Congress calls this fiscal responsibility? A Republican 
Congress, but of course.
  With all the problems facing middle-class Americans, soaring energy 
costs, coupled on top of skyrocketing health care costs, educational 
expenses, and flat incomes 5 years in a row, what is the solution 
offered by this Republican Congress? Cut capital gains and dividend 
taxes for millionaires.
  It is time for a change in new priorities rather than that same old 
tired failed policies that got America to where it is today.
  This budget cuts $9.5 billion, adversely affecting $6 million 
children's health care. It cuts 40,000 children from nutritional 
assistance. It cuts child care assistance leaving 330,000 children 
without child care assistance. It cuts $14.5 billion from student aid 
and college assistance. It cuts child support collections $4.5 billion.
  This budget gives a whole new meaning to women and children first. 
And what do they do in return? Fifty-three percent of the benefits of 
this tax cut on dividends and capital gains goes to people earning $1 
million or more, and 62 percent of the benefits go to those earning 
$500,000 or more.
  What kind of Congress would throw children over the side to pay for 
more tax cuts for the wealthiest Americans? A Republican Congress, but 
of course.
  These are the wrong priorities for America. We can do better. It is 
time for a change and for a new direction.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Colorado (Mr. Beauprez), a distinguished member of the Ways and Means 
Committee.
  Mr. BEAUPREZ. Mr. Speaker, this has been an interesting debate, as it 
always seems like it is these days in this House. In 2003, I actually 
thought we did some very good things with the tax cuts we implemented, 
and I thought we did them for families back home in all of our 
districts. So on August 2, 2005, I joined with a colleague of mine from 
Colorado, Congresswoman Musgrave, a member of the Small Business 
Committee, and we explored the effect of at least one of those tax cuts 
that we are talking about extending today, section 17, which increases 
the allowable expensing limits from $25,000 on depreciable assets to 
$100,000.
  Now, I think Linda Jones, the owner of Area Rentals back in 
Westminster, Colorado, will be delighted to understand that she is a 
member of a special interest and must surely be rich, by definition, 
because she got a tax break. What she did with that was, in 2003, she 
used $57,000 of the allowable expensing limits to purchase some 
additional equipment that she rents in her store. And because she saved 
a little over $7,300 in tax expense, and that came the same year she 
got a 30 percent increase in her employees' health care costs, she was 
able to maintain coverage for health care for her employees. The very 
next year she used an additional $64,000 of the expensing allowance to 
purchase even more equipment to expand her store, keep jobs, and, in 
fact, increase jobs.
  Ron Lautzenheiser must be among the rich and the special interests, 
too, except he runs a big old tire center back in Fort Collins. When he 
did his calculations, wanting to expand, the increase in expensing 
limits contained in section 179 allowed him to figure out how to do 
that. He added two new stores and went from one big old tire center 
employing but a handful of people to now employing 50 people in three 
stores.
  This is commonsense legislation for the real people back home, and I 
urge its adoption.
  Mr. RANGEL. Mr. Speaker, I reserve the balance of my time, having 
only one speaker remaining, until the other side reaches that point.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Herger), a distinguished member of the Ways and Means 
Committee and chairman of the Human Resources Subcommittee.
  Mr. HERGER. Mr. Speaker, today's legislation contains a number of 
important tax relief provisions, including an expanded research and 
development credit to keep American innovation competitive; and one 
supported by my friend from Wisconsin, Paul Ryan, which would adjust 
the qualified veterans mortgage bond program and expand access to 
affordable home loans for California veterans who served after 1977.
  In addition, the bill before us includes a measure that I have long 
supported to facilitate greater small business growth. Small businesses 
are the backbone of our economy, representing over half of all jobs and 
economic output. The section 17 extension in this bill will enable 
small businesses to write off new capital investment up to

[[Page 27788]]

$100,000 per year, spurring further economic growth and helping to 
generate new jobs.
  In 2003 alone, 4.6 million small businesses used $44.1 billion of 
section 179 expensing. According to the National Federation of 
Independent Businesses' November report, 61 percent of small business 
owners reported capital outlays over the past 6 months, including new 
equipment and vehicle purchases, furniture purchases, existing facility 
expansion, and improvement in new facility construction.
  Small business expensing works and it helps drive job creation in 
areas like my own northern California Congressional District. 
Unfortunately, the current expensing limits are set to return to 
significantly lower levels if we do not extend this provision.
  Mr. Speaker, I would like to thank Chairman Thomas and the members of 
the committee for their support of small businesses, and I urge my 
colleagues to vote for the legislation before us today.
  Mr. RANGEL. Mr. Speaker, I continue to reserve the balance of my 
time.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Illinois (Mr. Weller), a distinguished member of the Ways and Means 
Committee.
  Mr. WELLER. Mr. Speaker, I thank the gentleman for yielding me this 
time, and for his leadership on this issue as well as many others.
  It is good to be in the House doing something that is pretty basic. I 
support this legislation. I would note that if you vote ``no,'' you are 
actually voting to increase taxes because this is legislation simply 
extending current law that expires in the coming year.
  I also want to point out a provision that is very, very important in 
districts like mine, in areas like the Chicago suburban area, because 
it is legislation that addresses the need to revitalize old urban 
areas, to recycle, and to use old abandoned industrial sites. That is 
the brownfields provision.
  I have worked over a number of years with Chairman Thomas and others, 
and we have worked in a bipartisan way, to find ways to encourage 
reinvestment in old abandoned industrial sites. You will find, in many 
cases, that these old industrial sites have environmental 
contamination, and because of that investors would much rather go out 
and buy a cornfield, a greenfield site, and create an industrial park, 
which consumes five to six times as much land, creates urban sprawl, 
and also costs the taxpayers more because you have to replace the water 
and the sewer and the infrastructure and the roads.
  Well, in the coming year, the environmental cleanup provision for 
brownfields, that tax incentive, expires. So we extend that. But we 
also do something more, which I think is very, very important. And, 
really, the recent occurrence of Katrina highlights it, because we have 
often heard about the petroleum contamination in the New Orleans area 
and the need for cleanup. Well, if you think of your own communities 
and the south suburbs of Chicago and rural areas that I represent, we 
can always think of that gas station on a corner that has been closed 
for 20 years and which sat abandoned, with no one buying it.
  And if you ask the local real estate people or the local economic 
development people why, they say, well, they had some petroleum 
contamination there. If somebody buys it, they have to pick up the 
cost. It does not qualify for the LUST program. So the investor who 
purchases that old abandoned gas station has to pick up the cost.
  With this legislation, we expand the brownfields tax incentive to 
include petroleum. So whether it is oil factories, gas stations, 
transportation hubs, or rail yards, we give that opportunity to 
recycle, renew, and revitalize.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas 
(Mr. Sam Johnson), a distinguished member of the Ways and Means 
Committee.
  Mr. SAM JOHNSON of Texas. Mr. Speaker, I am pleased to rise today in 
support of this bill and the resilient American economy. This act will 
build on our legacy of tax relief that is fueling our economy, and will 
extend some very important tax provisions that will keep America's 
economy moving forward.
  Freedom and free enterprise go hand-in-hand. And keeping tax rates 
low so people have more of their hard-earned money in their pockets is 
the right way to go.
  Texans want, need, and deserve to have their sales tax deduction 
extended. It is vitally important for Texas. In Texas, we like to say 
``no new taxes.'' We finance our spending through a sales tax. In 2004, 
we made sales taxes deductible from Federal taxes again, but that 
deduction expires in just a few weeks. My constituents want to keep the 
sales tax deduction. This bill will allow any American to choose to 
deduct either State sales tax or their State income tax through 2006. 
That is a great idea.
  Next, this bill extends the popular research and experiment tax 
credit. Luckily, we fine-tuned it to make it work even better. Many 
companies in our districts will be able to use this new alternative 
simplified credit. They will be able to add good research and create 
new jobs because of it. This extension and expansion of the credit are 
great for American jobs and our economy.
  Finally, we must extend the tax rate reduction on capital gains and 
dividends. This pro-growth policy helped spark the economy that we are 
seeing today. People and companies need to have some certainty for 
making decisions about long-term capital gains and dividend policy. 
Forcing folks to work with short-sighted tax policy just does not make 
sense. We have to change that if we want to see our economy stay the 
course.
  Mr. Speaker, I am proud to support this bill and urge my colleagues 
to support it.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from Ohio 
(Mr. Turner).
  Mr. TURNER. Mr. Speaker, I support H.R. 4297, the Tax Relief 
Extension Reconciliation Act, which provides extensions for incentives 
for brownfields remediation, a vital tool for national economic growth 
and for our Nation's cities. I want to echo the comments of my 
colleague, Jerry Weller, and applaud his efforts for supporting the 
remediation of brownfields.
  Brownfields are found in every State and in every Congressional 
District. Estimates range from 500,000 to 1 million brownfields sites 
across the Nation, covering roughly 400,000 acres.
  Private investment is essential for urban growth. The expensing 
extension is a tool businesses can use to invest in urban 
redevelopment. In fact, it is estimated that brownfields redevelopment 
could generate as much as $1.2 billion annually in new tax revenue for 
American cities.

                              {time}  1245

  Brownfields are a major concern to America's cities, and we must 
provide as many incentives as necessary to clean up these contaminated 
sites, bring businesses back into our cities, and continue strong 
economic growth. This extension is an important first step toward 
redeveloping our Nation's brownfields, but much work is yet to be done. 
I urge my colleagues to support this important issue and vote in favor 
of H.R. 4297.
  Mr. RANGEL. Mr. Speaker, I yield for a unanimous consent request to 
the gentleman from American Samoa (Mr. Faleomavaega).
  Mr. FALEOMAVAEGA. Mr. Speaker, I include my remarks on deliberations 
on this bill.
  Mr. Speaker, as a matter of public record, I wish to thank the 
Honorable William Thomas, Chairman of the House Committee on Ways and 
Means, for his unwavering support in saving the jobs of more than 5,000 
tuna cannery workers and the economy of American Samoa for future 
generations. Chairman Thomas is a true friend of our people. He stood 
with us during the Andean Trade debate and he is standing with us again 
on an extension of 936 tax credits for American Samoa until such time 
as a more long-term solution can be put in place once the GAO and Joint 
Committee on Taxation complete their reports regarding the impact of 
Federal tax policy in the insular possessions.
  I also thank the Honorable Charles Rangel, Ranking Member of the 
House Committee on Ways and Means. Congressman

[[Page 27789]]

Rangel is also a friend of American Samoa and has championed our cause 
on each and every trade agreement that has come before the U.S. 
Congress. He also supports our extension of 936 tax credits for an 
additional year.
  At a time when our Nation is faced with paying for the war in Iraq 
and helping the victims of Hurricane Katrina, I know the inclusion of 
American Samoa in H.R. 4297 was no easy task. I also know it was no 
easy task for my Democratic friends to allow this amendment to be 
included when on principle there is disagreement about tax cuts and 
government spending.
  While I appreciate the concerns we share and respect the fundamental 
differences between us, the possession tax credit offered by section 
936 of the Internal Revenue Code of 1986 has encouraged two U.S. tuna 
canneries which employ more than 5,150 people or 74 percent of the 
workforce to remain and invest in American Samoa. More than 80% of 
American Samoa's private sector economy is dependent either directly or 
indirectly on these canneries and a decrease in production or departure 
of one or both of the two canneries in American Samoa could devastate 
the local economy resulting in massive layoffs and insurmountable 
financial difficulties.
  For this reason, I again thank the Chairman and Ranking Member and my 
Republican and Democratic friends for working with me to include an 
extension of 936 tax credits for American Samoa in H.R. 4297. Only 27 
provisions were included and most tax credits were only extended for a 
year due to budgetary concerns and, in the case of the possession tax 
credit, pending reports which will guide the Committee next year.
  Again, given how serious this issue is for American Samoa, I urge 
support of H.R. 4297 and I thank the Chairman for supporting my request 
to include language in the conference report to provide for the 
development of a comprehensive long-term policy for American Samoa once 
the GAO and the Joint Committee on Taxation complete their reports.
  Mr. RANGEL. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, we have now come to the conclusion of this debate, and I 
want my colleagues to know that if you are looking for some of the 
things that are worthwhile that are in the majority's bill, we have an 
opportunity in the substitute to take care of it. But if you really 
believe this is the time for America to give a $20 billion tax cut to 
these people who will not be affected until 2009, why would they want 
to give this incentive to less than 5 percent, 1 percent of the richest 
people that we have in our country, and do it in this Christmas season?
  So you have an alternative. You can take care of the wealthy in years 
ahead, since this does not expire this year, or you can do what they 
have not done and that is to take care of those people who find 
themselves subjected to an alternative minimum tax only because the 
majority has not seen fit to give them relief in a decade. And so as 
this number has increased, instead of taking care of them in the bill 
that is before us, they have decided to just send a message over there 
to tell the Senate if you would like, by unanimous consent, and if no 
one objects, then you can take care of the AMT problem.
  We do not do this as Democrats. We take care of it up front. We take 
care of the military, we take care of those people from Hurricane 
Katrina, and we take care of the job credits that are important. We 
take care of those things that are important in our substitute.
  In this holiday season, we really do not believe that you ought to 
take $10 billion out of health care for the poorest people in this 
country. We do not believe that you should, in order to pay for this 
bill, that you should cut food stamps. We do not believe that students 
that have been getting help from this great government of ours should 
be adversely affected to pay for this tax cut.
  So we ask you to really consider in this holiday season these 
families that have kids in foster care, these families that are having 
their benefits not being received because we are letting them down. You 
just weigh this and ask, is there any equity involved in this? If you 
want to give these tax cuts, why do you not wait until the thing 
expires? Perhaps we will have a new Congress. Perhaps there will be new 
equity. Perhaps it can be discussed. Perhaps the committee members, 
Democrats and Republicans, would come together and find out not what is 
just good for the wealthy, but what is good for the strength of this 
great Nation of ours.
  One of the greatest threats to our national security is poverty. One 
of the greatest threats to our national security is the inability to 
get an education. The people who died in Hurricane Katrina did not die 
because of their color. The hurricane was color blind. But they died 
because they were poor. Why can we not invest and make certain that all 
Americans, black and white, Republicans and Democrats, can this holiday 
season say Congress did the right thing and not the political thing?
  Mr. CAMP. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, the bill before us today extends important tax relief 
for families and small businesses all across this country. Much of the 
relief in this bill is already in current law and will expire next 
month. If we do not pass this bill, Americans will be hit with tax 
increases.
  The tax relief in this bill goes directly to the issues of poverty 
and education that the gentleman from New York mentioned. This bill 
will allow America's teachers to receive tax deductions on out-of-
pocket classroom expenses. Students will be able to use tax incentives 
to enhance the affordability of higher education. Employers will be 
eligible for incentives for hiring low-income Americans transitioning 
from welfare to work, getting on that first rung of the economic 
ladder, and States and local governments will continue to be able to 
qualify for tax credit bonds to help repair schools, purchase school 
equipment and train teachers in economically distressed areas.
  These are just a handful of the important tax benefits this bill will 
provide to low- and middle-income Americans and small business owners.
  This bill is also a big win for our Nation's economy; and without a 
strong economy, we will not see families achieve the kind of economic 
independence they need to realize the American Dream. This bill 
reauthorizes and strengthens the research and development tax credit 
amendment which passed the committee with a unanimous vote. It is a 
valuable tool in promoting U.S. businesses to innovate.
  When I hear about distressed manufacturers in Michigan, one of the 
main issues they are competing on is to innovate and find the newest 
technology to remain competitive in a global economy. Michigan's 
economy, my home State, is closely tied to the ability of Michigan 
companies to make a sustained commitment to long-term, high-cost 
research. The manufacturing sector in the United States is the highest 
user of the research and development tax credit. Michigan, for example, 
is one of the top 10 States in reported research and development 
activity with more than 1,300 companies performing research and 
development in that State.
  This bill is a positive piece of legislation across the board. It 
helps small and low-income businesses and working families, as well as 
helps our manufacturers to rebound, and also our high-tech community to 
stay competitive in a global economy. I urge my colleagues to support 
this legislation and vote ``yes'' on the bill.
  Mr. LARSON of Connecticut. Mr. Speaker, I rise in support of the 
Democratic alternative to H.R. 4297, Tax Relief Extension 
Reconciliation Act that would provide real tax relief to working 
families and help the economy grow.
  The underlying bill is more of the same--more fiscally irresponsible 
policy. The President's policy of ``stay the course'' is not working; 
it's not working in our foreign policy, domestic policy, budget policy 
or tax policy. More of the same is just not working and now is the time 
for a new direction.
  Unlike the reckless tax bill on the floor, the Democratic alternative 
would help more Americans help themselves and ensure that as a country, 
we move forward together. Among other things, the Democratic measure 
would exempt every family making less that $200,000 from the 
Alternative Minimum Tax (AMT). The Democratic measure would also 
provide $42 billion in targeted tax cuts including, deductions for 
state and local retail sales

[[Page 27790]]

taxes, deductions for college tuitions expenses, a research and 
development tax credit, a small business expensing tax credit, and a 
larger earned income tax credit for the families of those serving in 
Iraq. Most importantly, the Democratic alternative would be fully 
offset instead of pushing the country further into debt like the 
Republican bill.
  The truth is that more than one-half of all taxpayers would get less 
than $30 in tax relief from this bill, while those who make over a 
million dollars a year would get an average tax break of $32,000. 
Supporters of the capital gains and dividends tax cuts have tried to 
characterize them as offering benefits that are more broad-based than 
AMT relief. However, in reality, households with incomes between 
$100,000 and $500,000 would receive 87% of the benefit of AMT relief, 
compared to 62% of the benefit for capital gains and dividends tax 
cuts.
  Where are the priorities of this House? What message are we sending 
to the American people? It's time for a new direction because more of 
the same failed policies aren't working. Americans deserve better. I 
urge my colleagues to join me in rejecting the underlying bill and 
supporting the Democratic alternative that would provide real tax 
relief and strengthen our country.
  Mr. STARK. Mr. Speaker, I rise today in strong opposition to H.R. 
4297, yet another tax break for the richest among us at the expense of 
those who have the least.
  The Republicans want to cut taxes by $94.5 billion. How do they pay 
for these cuts? Before Thanksgiving they voted to cut $50 billion from 
programs that help the poorest Americans. The conclusion is obvious: 
They are paying for the tax cuts for wealthy Americans by cutting 
programs for working Americans.
  Under the tax break package presented today, a family of four 
surviving on $30,000 a year will get an average of $50 extra in their 
tax return next April. Meanwhile, a millionaire will gain an extra 
$51,000.
  Lets just see what kind of lifestyle enhancement these tax cuts can 
buy:
  The $30,000 working family of four can use the extra $4.16 they 
receive each month to buy any one of the following: 1.75 gallons of 
gas; a half-pound of cheese; one gallon of orange juice; two loaves of 
white bread; three grapefruits; or for those indebted to the NRA, 6 
bullets for a .44 Magnum.
  People making over $1 million get a tax break of $4,250 a month, that 
they could use to purchase one of the following: leases on four BMW 
750i sedans; 17 iPod nano's; a 50 inch flat screen plasma TV; a five 
karat diamond tennis bracelet; or a 10-day European cruise. Or, if they 
wanted to, they could pay the monthly health insurance premiums for 
four families.
  If the Republicans want to cut taxes, they should pay for it. We 
could save billions by pulling our troops out of Iraq. That could pay 
for Katrina relief and stop cuts to important programs for working 
families. Instead of handing out holiday tax breaks to rich Republican 
campaign donors, we should be rolling back Bush's tax breaks for 
millionaires to better fund important programs like Medicaid and 
student loans.
  Also, Republicans need to drop the ``fiscal conservative'' moniker. 
These tax breaks combined with last month's cuts on programs for those 
in need will rack up $44 billion in new debt. The fiscal disciplines of 
the Republican party apparently means we drive our nation into debt and 
send the bill to our children and grandchildren.
  The numbers don't lie. The Republican priority is tax breaks for the 
rich, nothing more. They will cut programs for the poor and increase 
the deficit by billions of dollars to get their way. I urge all my 
colleagues to stop this insane fiscal policy by voting ``no'' on this 
bill.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, we have before us a very 
important piece of legislation, H.R. 4297, the Tax Reconciliation Act. 
It is very important to understand this piece of legislation within the 
big picture the Republicans are painting here. Just last month, the 
Republicans passed a bill called ``The Deficit Reduction Act.'' This 
was a spending cut bill that slashed funding to many vital programs my 
constituents depend on, including to Medicaid, student loans, food 
stamps, and child support programs. The Republicans lectured us on the 
need to make sacrifices to control the national debt. By passing the 
spending cut bill, the Republicans actually asked the poor, the 
downtrodden, the disabled and the young to sacrifice on behalf of the 
rest of the country.
  Now we are faced with the Tax Reconciliation Act, which will actually 
add $86 billion dollars to the deficit over the next 5 years. This 
proposed tax cut will not help the poor and middle class, either. An 
estimated forty percent of the tax cuts will go to families with 
incomes of $1 million or more, and 84 percent of the major tax cuts in 
this bill will go to the richest 20 percent of families.
  In fact, under this bill, over 17 million middle class Americans will 
face a tax increase next year from the Alternative Minimum Tax (the 
AMT)! An important aspect of this bill is the House's failure to 
adequately address the AMT. The Alternative Minimum Tax was enacted 
over 35 years ago to ensure that the richest Americans would pay their 
fair share of income tax. Unfortunately, when the AMT was enacted, 
Congress neglected to index the tax rates to inflation. The AMT has now 
begun to add an extra burden to middle class taxpayers at an alarming 
rate. The senate bill provides $30 billion for AMT relief to the middle 
class, while the House Republican leadership could only find $2.8 
billion for this cause.
  Republicans couldn't find the money to adequately pay for AMT relief 
for the middle class. They can't find any money for tax relief for 
those affected by hurricane Katrina in the Gulf Coast. Last month, the 
Republicans couldn't find the money to spare the elderly from Medicaid 
cuts, to spare the students from loan increases, or spare our children 
from child care cuts. They couldn't find the money because they are 
choosing to extend the dividend and capital gains tax cuts for the 
richest in our country.
  This is not how we take care of our own in Texas, and this is not how 
we do things in the United States. The Republicans are launching an 
unabashed attack on the American way by ignoring the neediest in our 
country to give tax cuts to the richest.
  Mr. Speaker, the decision to vote up or down on this legislation 
isn't a blurry line involving political ideology; it isn't a debate of 
Republican vs. Democratic philosophy. The priorities in this bill are 
misguided. Congress should not be providing additional tax breaks for 
the rich less than a month after huge spending cuts aimed at the most 
vulnerable. Congress should not be providing tax cuts for the rich in a 
time of war! In the end, this tax bill will either exacerbate our 
already large federal deficits, or will force even deeper cuts in 
critically important domestic programs. I am strongly opposed to this 
legislation, and I implore my colleagues on both sides of the aisle to 
vote against these unreasonable cuts and instead consider the revenue 
neutral Democratic alternative.
  Mr. BACA. Mr. Speaker, I ask unanimous consent to revise and extend 
my remarks.
  Mr. Speaker, this bill is easy to describe--tax cuts for millionaires 
and tax increases for the middle class. This bill misses the biggest 
tax cut priority of this Congress--the alternative minimum tax, or AMT.
  The AMT was designed to prevent the wealthy from avoiding Federal 
taxes by taking too many exemptions, but it was never adjusted for 
inflation. Therefore, many middle-class American families are being 
affected and penalized.
  Yet, instead of solving the problem of the AMT and helping middle 
class families, this bill only focuses on helping the rich get richer 
by extending capital gains and dividend tax cuts that don't expire 
until 2009!
  This tax cut means that taxpayers with incomes below $40,000--the 
majority of taxpayers--will get about one percent of those cuts, an 
average of $3 a year. Those with incomes above $1 million--one in 500 
households will get 53 percent of the cuts, an average of $38,000 per 
year.
  Mr. Speaker, even by this Republican Congress' standards, this tax 
cut legislation is insulting. And because this bill will add $1.9 
trillion to the deficit it is doubly so.
  That is why I support the Democratic alternative that would instead 
fix the AMT for couples making less than $200,000 per year, reducing 
middle class taxes instead of increasing them. Further, the Democratic 
alternative would be fully paid for by slightly reducing recent tax 
cuts for those making more than $1 million per year. America needs 
fiscal discipline like we had during the Clinton years. The $5.6 
trillion surplus projection from 2001 is now a $3.5 trillion deficit--a 
swing of $9.1 trillion!
  Tax cuts to millionaires have dropped revenues from 20.9 percent of 
the GDP in 2000 to just 16.3 percent, while spending has increased 1.4 
percent.
  Mr. Speaker, the Blue Dog Coalition has the message right--we need to 
restore fiscal discipline. Defeating this bill would be a good first 
step.
  Ms. MATSUI. Mr. Speaker, as we begin debate on additional tax cuts--
H.R. 4297--we must consider them in the larger context of the 
challenges this nation is facing and the impact these tax cuts will 
have, on our ability to face these challenges as well as future 
challenges. Our decisions must always prioritize protecting the future 
of this nation for our children and their children.
  Over the Thanksgiving recess, I participated in a program in my 
district that sought to increase early literacy by incorporating 
reading

[[Page 27791]]

into doctors' visits. During my visit, I read to these children--who 
are about my granddaughter Anna's age--about ``Clifford the Big Red 
Dog.''
  It is truly a wonderful program, and as I recall the joy and 
animation on each child's face with every turn of the page, I am 
reminded just how important the decisions we make today are . . . 
because we are merely stewards of this nation for them--and we must act 
as such. Are we being wise stewards in choosing to pass another tax 
cut--on top of the nearly $2 trillion in cuts we have already passed?
  Congress has already transformed a $5.6 trillion surplus into a more 
than $3 trillion debt.
  Yet, we are still financing the war in Iraq and the reconstruction 
from the war in Afghanistan. Regardless of your view on our nation's 
military policy over the past five years--we must pay for the wars and 
their subsequent cleanup, yet to date they have been financed by 
deficit spending. And we have only just begun the rebuilding efforts in 
New Orleans, Gulfport and other Gulf Coast cities struck by Hurricane 
Katrina.
  Which brings us back to the legislation we are considering today. 
There are many positive provisions in this bill. They would create an 
even better future for our children and grandchildren, like my 
granddaughter Anna--particularly the provision to strengthen and extend 
the research and development tax credit. I am a strong supporter of 
this investment.
  Unfortunately, the centerpiece of this bill--the dividends and 
capital gains tax cut extensions--is unnecessary at this time. Not only 
do these cuts not expire until 2008, they primarily help the same 
individuals who have already benefited lavishly from the previous 
rounds of tax cuts.
  So we are at war, we are in debt and yet again we are cutting taxes 
without fully paying for it. The path we are beginning to turn down, as 
begun by this budget package, may ultimately include tax cuts that will 
far outstrip the some $50 billion worth of unwise spending cuts. Just 
the tax cuts in this bill will add at least $6 billion to the deficit 
and it seems more may be added outside this reconciliation process.
  Sadly, it seems the only Americans asked to sacrifice are the brave 
men and women in uniform fighting in the Middle East and our children 
and grandchildren, like my Anna, who will bear the burden of our 
massive debt. This defies historical precedent and common sense.
  We do, however, have an opportunity to make a decision that will 
return us to the path of fiscal responsibility. Ranking member Rangel 
has offered a pragmatic and effective substitute bill and I am glad 
today's rule will allow a vote on it.
  This alternative will extend the tax cuts that expire at the end 
ofthe year and provide a muchneeded AMT patch. And the Democratic 
alternative will be paid for by taking back a small portion of the tax 
cuts that benefit families earning more than $500,000. Simply, we 
extend only what is necessary and we pay for it--Anna and other future 
generations deserve no less.
  I urge my colleagues to embrace the principle of shared sacrifice and 
reject this tax reconciliation package in favor of the responsible 
Democratic substitute.
  Mr. VAN HOLLEN. Mr. Speaker, today we are presented with Act II of 
the Republican majority's ongoing and tragically misguided 
reconciliation saga.
  In Act I, we learned who the majority felt most deserved to bear the 
brunt of their spending cuts: poor citizens who rely on Medicaid, 
hungry people who turn to food stamps and families trying to afford 
college.
  Now in Act II we are learning where they propose that money go: for 
tax breaks, that are targeted primarily to benefit the top 1% of the 
wealthiest Americans. And what is the net result? An even bigger 
deficit that will have to be paid for by our children.
  Let me be clear: In a properly prioritized budget, I believe there is 
room for targeted, fiscally responsible tax relief. And that's 
precisely the kind of tax relief Democrats are offering in our 
substitute today.
  The Democratic alternative extends all of the tax cuts set to expire 
next year--including such items as the deduction for college tuition 
expenses, incentives for brownfields cleanup and the 15-year 
depreciation schedule for certain small business expenses. Moreover, 
unlike the Republican package, Democrats provide guaranteed alternative 
minimum tax relief--so that 16 million middle-class taxpayers won't be 
unfairly ensnared by the AMT. Finally, and importantly, the Democratic 
substitute is completely paid for--and won't add a dime to the Federal 
deficit.
  By contrast, when considered in its entirety, the Republican 
reconciliation package will actually increase the deficit--at a time 
when the nation's debt is already running over $8 trillion. 
Additionally, when faced with the choice of whether to use the 
reconciliation process to protect AMT relief for middle-class taxpayers 
or tax breaks for the wealthiest investors, the Republicans chose to 
leave AMT relief unprotected while extending tax -breaks on capital 
gains and dividends that don't even expire until 2008--tax breaks over 
half of whose benefits flow to those who made over $1 million last 
year.
  Mr. Speaker, during a time of war, in the aftermath of a catastrophic 
hurricane, with 45 million Americans lacking health insurance and 
skyrocketing home heating costs projected this winter, this majority is 
proposing to take from those with the least, give to those with the 
most--and tell our children they will have to pay for it all later.
  Mr. Speaker, we can do better. In fact, I would submit that--in this 
season above all seasons--we are required to do better.
  I urge my colleagues to reject this bill and support the fiscally 
responsible Democratic substitute.
  Mr. UDALL of Colorado. Mr. Speaker, as we debate this bill, we must 
remember it is only part of a brew based on the Republican leadership's 
budget recipe.
  Just before Thanksgiving, they twisted enough arms to put the first 
ingredients into the mixing bowl by passing a bill to cut more than $50 
billion over five years from Medicaid, student loans, and many other 
programs of great importance to millions of Americans.
  Today, they want to continue by adding some good things--including 
extensions of well-targeted tax cuts like the research and development 
tax credit and small business expensing tainted by some unwholesome 
provisions, especially the premature extension of preferential rates 
for dividends and capital gains.
  The result, just in time for holiday parties, will be a full-bodied 
one-two punch.
  And while some may find it intoxicating, it will have a nasty 
aftertaste for many, will leave everyone with a bad budgetary 
headache--because it will actually increase the deficit--and will stick 
future generations with paying the tab.
  So, Mr. Speaker, count me out. I thought the original recipe was 
wrong. I did not vote for the first part of the mixture. And I will not 
vote for this bill.
  That doesn't mean I am opposed to tax cuts. As I said, there are good 
things in this bill, and I support them. That's why I voted for the 
substitute.
  The substitute would have exempted every family making less than 
$200,000 from the alternative minimum tax--something that should be a 
priority but that is not included in the bill before us. Adoption of 
the motion to recommit would have had the same effect.
  The substitute also included $42 billion in tax cuts over five years 
targeted to spur economic growth by extending the most pressing tax 
provisions that are now scheduled to expire this year.
  However, unlike this bill, the substitute did not include extension 
of things that will not expire this year--including the preferential 
rates for dividends and capital gains--or the changes to international 
tax rules.
  Unfortunately, the Republican leadership was not willing to follow 
that more reasonable approach, and is insisting on sticking with their 
own recipe.
  But the Senate has passed a quite different tax measure, and 
differences between that bill and this one will have to be resolved in 
conference. So, while I cannot support this bill I am hopeful that the 
conferees will insist on a new and better mixture that will deserve 
support.
  Mr. ETHERIDGE. Mr. Speaker, I rise in strong opposition to this 
latest wasteful Republican tax bill and in strong support of the Rangel 
substitute. The Rangel bill is a responsible effort to extend needed 
tax relief and protect middle class Americans from the Alternative 
Minimum Tax (AMT), but the underlying legislation is the latest 
installment of the failed Republican budget policies that have 
devastated this country's finances and much of our economy.
  I strongly believe that Congress must return to the values of 
balanced budgets to restore growth and opportunity to our Nation's 
economy. I am tremendously proud that in my first term in the U.S. 
House, Congress and the White House worked together in a bipartisan 
manner to balance the budget for the first time in a generation. That 
responsible budget helped usher in a period of robust, broad-based 
economic growth and produced record budget surpluses.
  Unfortunately, the current White House and Republican Leaders in 
Congress replaced that budget discipline with record deficits, 
exploding national debt and unbalanced budgets in perpetuity. This bill 
represents more of the same. The current Republican tax cuts will

[[Page 27792]]

cost our budget $81 billion over ten years, while at the same time, 
Republican Leaders have proposed devastating cuts to the Farm Bill, 
food stamps, child support enforcement and Medicaid. Furthermore, H.R. 
4297, the Tax Reconciliation Bill, raises the taxes of nearly 17 
million middle class families in America, by leaving out a provision to 
extend the higher AMT exemptions that expire in a few weeks.
  In contrast, the Rangel substitute would exempt from AMT increases 
every family with taxable income under $200,000 per year. It includes 
$42 billion in tax cuts over five years targeted to spur economic 
growth through the Research and Development tax credit, small business 
expensing and other initiatives. The Rangel bill maintains budget 
discipline by paring back the President's tax cuts for those with 
annual taxable income above $1 Million. Finally, the Rangel bill keeps 
our word to the families of our soldiers in Iraq and Afghanistan by 
maintaining their eligibility for the Earned Income Tax Credit.
  I urge my colleagues to support the Rangel substitute and vote 
against H.R. 4297.
  Mr. HOLT. Mr. Speaker, today we return for part two of the budget 
reconciliation bill. Just before Thanksgiving, the Republican majority 
cut investments in education, American competitiveness, and programs 
for the needy. Today, they will give a tax cut to the top 1%. It is a 
reverse-Robin Hood value system. Apparently, the Republican leadership 
thinks that the middle class is not working hard enough. They believe 
that the middle class needs to work harder so that the top 1% can take 
home more money.
  Today, Mr. Speaker, we have a moral decision to make. I believe it is 
immoral to cut $50 billion from Medicaid, food stamps, student loans, 
child care payment enforcement, and foster care in order to pay for a 
$56 billion tax cut for capital gains and dividends.
  People with income of more then one million dollars--the top two-
tenths of one percent of the population would get $32,000 dollars. Most 
tax filers, those with income below $40,000, would get $7. Those with 
income above $1 million--not just those worth more than a million, but 
those who have income and stock market earnings of more then $1 million 
each year--would receive about half of this $56 billion tax cut. Worse 
yet, you may have noticed that if we cut taxes by $56 billion and cut 
spending by $50 billion, we have increased the debt. We have gone from 
a projected 10-year surplus of $5.6 trillion to a projected deficit of 
$3.5 trillion. With the deficit projected to rise to $640 billion by 
2015, this is no time to pile on even more. This bill will force us to 
borrow more from China. This is more debt we will force our children 
and grandchildren to pay interest on. And for what? So the wealthiest 
1% can get an even larger tax break.
  Mr. Speaker, I believe there are problems with our tax system. I have 
supported tax cuts in the past and I have worked with Members on both 
sides of the aisle to achieve them. However, today we are ignoring a 
tax problem that affects my constituents greatly. Many of my middle 
class constituents are forced to pay the Alternative Minimum Tax (AMT). 
This year, 3.5 million taxpayers will owe AMT. Yesterday's AMT tax bill 
was just a sham, and is likely to go nowhere. With this package, 
Republicans knowingly and deliberately have removed the AMT correction 
and thereby will increase the taxes on more than 17 million middle-
class working families next year by failing to extend the higher 
exemptions for the Alternative Minimum Tax (AMT) that expire in several 
weeks. If we fail to include this in budget reconciliation, it will 
grow to 19 million taxpayers next year. More than half of all couples 
with two children and income between $75,000 and $100,000 will have to 
pay AMT next year. This is wrong and should be addressed.
  We could solve this problem today by slightly reducing the recent tax 
cut for those making more then $1 million a year. Republicans are so 
determined to extend tax cuts for the wealthy that they are willing to 
deny relief to the middle class.
  Mr. Speaker, these votes ae about our priorities and values. I ask my 
colleagues to change the priorities of this Congress.
  Mr. HIGGINS. Mr. Speaker, I rise to express my opposition to the 
irresponsible tax reconciliation bill the House passed earlier today. I 
strongly support tax relief, but I oppose this bill because it does not 
target tax relief to middle class families, because it is paid for by 
slashing health care and education programs and because it will 
needlessly increase our national debt.
  Mr. Speaker, this tax bill is the second half of a misguided budget 
reconciliation package that raids the wallets of my Western New York 
constituents and gives their money to those making over a million 
dollars. The first half of the budget reconciliation occurred last 
month, when the Majority passed a series of devastating spending cuts 
to health and education programs in order to free up funding for these 
tax cuts. That means that these tax cuts are paid for by cutting $11 
billion from Medicaid at a time when over 45 million Americans are 
without health insurance. They are paid for by throwing 300,000 people 
off food stamps when hunger in this country is on the rise. They are 
paid for by slashing $14 billion from student loan programs when the 
cost of college tuition is skyrocketing. And they are paid for by 
cutting child support enforcement and foster care programs.
  Mr. Speaker, the tax reconciliation bill is paid for out of the 
pockets of the middle class, yet working families receive little of its 
benefits. If this bill were a serious attempt to provide real tax 
relief to the middle class it would include an extension of the 
alternative minimum tax (AMT) fix. The AMT fix is set to expire at the 
end of the year, and without an extension taxes will increase on the 17 
million middle class families who will be snared by the AMT. Yet this 
legislation does not include AMT relief. Instead, the centerpiece of 
this bill is a reduction of tax rates for capital gains and corporate 
dividends. Mr. Speaker, taxing investment income at a lower rate than 
earned income is rewarding wealth, not work. A fairer bill would have 
reduced taxes on the paychecks of the middle class working families who 
most need and deserve it.
  Mr. Speaker, not only does this reconciliation package slash programs 
for working families and fail to target tax relief at the middle class, 
but it does nothing at all to reduce the federal budget deficit or the 
national debt. In fact, this package increases the deficit because it 
reduces spending by $50 billion and cuts taxes by $56 billion. In other 
words, this so-called ``deficit reduction'' package actually increases 
the deficit to the tune of $6 billion! Maybe this fiscal approach 
explains why the Chairman of the President's own Commission on Tax 
Reform said recently that he was not worried by tax policies that 
increase the national debt because we can always borrow some more from 
China. But I refuse to pass this bill and saddle the elementary school 
children in Jamestown and Buffalo with that debt.
  Mr. Speaker, I support tax cuts. I supported the AMT stand-alone bill 
because the bulk of that relief goes to middle class families, and I 
will continue to support tax cuts for working Americans. I am not 
philosophically opposed to tax cuts for upper income Americans. But 
there is a proper time for everything, and at this juncture--when we 
are running record budget deficits, when we are funding our troops in 
Iraq, and when we are incurring huge costs to recover from Hurricane 
Katrina--at this juncture, we cannot cut taxes to the rich and increase 
the burden on the middle class. Buffalo won't hear it and neither will 
I.
  Ms. BALDWIN. Mr. Speaker, like many of my colleagues, I spent much of 
the Thanksgiving recess holding office hours throughout my 
congressional district to listen to the concerns of my constituents. 
Understandably, I heard how worried they are about skyrocketing energy 
prices, our lack of progress in Iraq, rising health care costs, and the 
recently passed budget cuts that predominately hurt the poor.
  One need look no further than the tax bill on the floor today to see 
why many Americans are frustrated and disappointed with the work of 
this Congress. Republicans just don't seem to get it. Instead of trying 
to make progress on the pressing issues facing American families, House 
Republican's top priority is passing this $56 billion tax bill that 
primarily benefits wealthy investors. H.R. 4297 is truly shameful as it 
clearly puts enriching the wealthiest Americans before the biggest 
concerns of working Americans.
  The centerpiece of the Republican's tax bill today is a $20 billion 
provision that would extend tax rate cuts for investors who receive 
capital gains or corporate dividends. According to Citizens for Tax 
Justice, the vast majority of Americans would receive no benefit at all 
from this tax provision.
  Specifically, 78 percent of Americans would get no tax benefit from 
the capital gains and dividends provision, while an additional 10 
percent would get less than $100. In my home State of Wisconsin, the 
wealthiest 1 percent of taxpayers (those with an average income of more 
than $1.3 million) would receive 43 percent of the tax benefits, or an 
average tax cut of $18,523 in 2009 and 2010 combined.
  This bill does contain a number of tax measures I strongly support, 
such as the extension of the important research and development tax 
credit, the state sales tax deduction, and the college tuition tax 
credit. These provisions are good for our Nation and working families, 
but they should not be simply used as ``sweeteners'' to garner more 
support for

[[Page 27793]]

the underlying bill and more tax cuts for investors.
  I find it heartless that Republicans would bring this bill to the 
House floor right after they I passed a Budget Reconciliation bill that 
makes harmful cuts to health care for children and the elderly, food 
stamps for needy families, student loans, and child support 
enforcement. Let us be clear: these $50 billion in budget cuts were 
made solely to pay for these tax cuts for the wealthiest Americans. How 
can any Member of this Congress who has an ounce of compassion--justify 
making college students, the poor, children, and the elderly shoulder 
the cost of providing more tax cuts for the wealthy? I certainly 
cannot.
  In Wisconsin, 91,000 children lack health insurance, up over 7% in 
just the last year. American families are struggling with soaring costs 
for fuel, housing, health care, child care, and college. Yet today, 
this Congress again turns a deaf ear to those concerns--not to reduce 
the deficit, not to pay for the war in Iraq, not to help the hurricane 
and tornado victims of 2005, but simply to satisfy those whose greed 
has no bounds.
  Mr. Speaker, H.R. 4297 is a sad indication of who House Republicans 
are fighting for in this Congress. It should come as no surprise as we 
have seen the very wealthiest Americans receive special tax breaks 
every year since President Bush took office. The question today is 
whether this House will ever stand up for the many, not just the few, 
with budget and tax policies focused on need, not greed? I strongly 
urge my colleagues to vote against this bill.
  Mr. LANGEVIN. Mr. Speaker, today I rise in strong support of the 
Rangel Substitute to H.R. 4297, the Tax Reconciliation Act and in 
opposition to the underlying bill. Instead of stopping a tax increase 
for the middle class in 2006, Republicans have chosen to keep taxes low 
for the wealthiest Americans in 2009. What kind of priorities favor the 
wealthy in the future over working families today? We can ill afford 
the continued ``tax cut and spend'' mentality that has marked the House 
during the last few years. Without a change in fiscal policy, future 
generations will be buried under a mountain of debt created by 
Congress.
  The bill before us today has many provisions I support, including the 
extension of the research and development tax credit, small business 
expensing, the deduction of higher education expenses, and brownfield 
sites expensing. In fact, I am a cosponsor of a bill to make the 
Research and Development Tax Credit permanent, as it keeps American 
companies competitive and provides a strong incentive for businesses to 
invest in the future and create jobs. I also support other provisions 
in this bill that help make college more affordable to millions of 
students and allow teachers to deduct out-of-pocket expenses.
  Unfortunately, the Republicans did not stop there. H.R. 4297 also 
includes a two year extension of the capital gains and dividend tax 
cuts, which are not scheduled to expire until 2008. Nearly half of 
these tax cuts will go directly into the pockets of the 1 in 500 
taxpayers who earn more than $1 million per year. The contrast is 
stark: those who earn less than $40,000 will see an average tax cut of 
$7, while those earning more than a million will save an average of 
$32,000 in taxes.
  While Republicans claim that the dividend tax cut boosts the economy, 
the facts are not on their side. The Federal Reserve Board recently 
released a report declaring that the dividend tax cuts of 2003 have not 
boosted the stock market. To quote the report, ``We fail to find much, 
if any, imprint of the dividend tax cut news on the value of the 
aggregate stock market.'' There you have it: the Nation's top 
economists have determined that dividend tax reduction does not boost 
the stock market or increase wealth for shareholders.
  Most disingenuous is the fact that just three weeks ago, the House 
voted to cut Medicaid, student loans, foster care assistance, and food 
stamps under the guise of deficit reduction. However, today, we are 
voting for tax cuts that cost more than the money saved from the 
spending cuts. The Republicans have exposed their real agenda: they are 
robbing the poor to pay the rich.
  This year, we have a projected deficit of more than $300 billion. In 
addition, we will spend billions more in Iraq and Afghanistan, as well 
as rebuilding the Gulf Coast in the wake of Hurricanes Katrina, Rita, 
and Wilma. We simply cannot afford all of these emergency expenses 
while cutting taxes for the richest Americans.
  Thankfully, there is an alternative. The Rangel Substitute includes 
all the noncontroversial tax extensions I mentioned earlier and also 
contains three important provisions not found in H.R. 4297. First, the 
substitute drops the capital gains and dividend tax cuts in order to 
fix the Alternative Minimum Tax (AMT). The substitute would eliminate 
AMT liability for individuals who earn less than $100,000 and joint 
filers with incomes below $200,000, cutting taxes for 16 million 
families. Without this provision, more than half of all families with 
two children and incomes between $75,000 and $100,000 will be saddled 
with the AMT. This tax increase hits the middle class, and the 
Republicans are content to sit idly and let it happen. The Democratic 
AMT fix is similar to the Senate-passed tax reconciliation legislation, 
which would ensure a speedy conference and protect taxpayers before the 
provision expires at the end of the year.
  In addition, the substitute extends the tax-free status of combat 
pay. While our military personnel are risking their lives abroad to 
keep us safe, the least we can do is prevent burdening them and their 
families with a huge tax increase.
  Best of all, the substitute is fully offset, and will not add a dime 
to the national debt. The Rangel substitute will revive the economy, 
relieve the tax burden on working families, encourage companies to 
invest in the future, and create jobs. The Republican bill will hand 
out money to rich people and increase the deficit.
  The Rangel Substitute is a common-sense alternative that prevents a 
tax increase on working families, honors our troops, and does not cost 
a dime. We need responsible tax policies instead of the reverse Robin 
Hood approach taken by Republicans. I urge my colleagues to join me in 
supporting the Rangel Substitute and opposing the underlying bill.
  Mr. COSTELLO. Mr. Speaker, I rise day in opposition to H.R. 4297, the 
Tax Relief Extension Reconciliation Act. I do so because I do not 
believe we should be cutting taxes for the wealthiest Americans while 
we are at war and at the same time cutting programs for our most 
vulnerable populations and adding to the staggering debt load of our 
children and grandchildren. This bill is not fiscally responsible, and 
we neglect the ramifications of the budget priorities of the majority 
party to the detriment of the country.
  Governments on every level--from local to Federal--are running record 
deficits; the number of uninsured Americans is on the rise; people 
continue to go without heat, food or shelter as an abnormally cold 
winter persists; and the cost of health care and education continue to 
rise. The tax cuts contained in H.R. 4297 overwhelmingly benefit 
affluent investors in the wake of the House cutting programs for the 
poor by $50 billion in the name of deficit reduction. We continue to 
spend over $6 billion per month in Iraq and cut taxes while asking the 
least well off to pay for it. It's reverse Robin Hood--taking from the 
poor and giving to the rich--and this is something I cannot and will 
not support.
  We must take stock and look at the reality of our fiscal situation--
deficits are rising with no end in sight--while the poor, the sick and 
the elderly pay the price. I believe tax cuts can be part of a 
reasonable approach to the Federal budget, but that we have reached a 
point with our deficit and debt where we must exercise extreme caution 
in using them. As Robert Bixby of the nonpartisan Concord Coalition was 
quoted in today's Washington Post, ``If they (Republicans) want to cut 
taxes, fine, but they are going to have to cut spending by at least 
that much to help the deficit, and clearly they are not willing to do 
that. They (Republicans ) have to start looking reality in the face.'' 
The $5.6 trillion surplus that existed in 2000 has been squandered. 
Future generations will pick up the tab.
  The Republican tax cut bill is bad policy and I urge my colleagues to 
join me in voting no on H.R. 4297.
  Ms. ROYBAL-ALLARD. Mr. Speaker, I rise today in strong opposition to 
H.R. 4297, the Tax Reconciliation bill. Cutting taxes for the super 
rich, and ignoring the needs of the poor and middle class, as this bill 
does, is a dangerous deviation from fiscal and moral responsibility.
  As with every American, I too would like to see my taxes cut. 
Therefore my opposition to this bill does not stem from a deep-seated 
hostility toward the concept of tax cuts. Rather, my opposition is a 
plain and simple recognition that these proposed tax cuts are the wrong 
kind of cuts at precisely the wrong time.
  Why are they wrong kind of tax cuts? Because they primarily benefit 
the super rich with little tax relief to middle class and poor 
Americans who need tax relief the most.
  Why do they come at the wrong time? Because today our Federal 
Government is unable to meet the most essential needs of the majority 
of Americans. For example, 45 million Americans are without health 
insurance, too many American families cannot afford to send their 
children to college, and our American communities continue to be 
vulnerable to terrorist attacks here at home due to the under-funding 
of many essential homeland security programs.
  Instead of investing in American families, this bill condones massive 
cuts to essential

[[Page 27794]]

health, education, and programs designed to help women and children. 
And instead of fully funding programs such as those designed to support 
our emergency first responders in the case of a terrorist attack, we 
are using that money to pay for tax cuts for the super rich.
  Add to this reality a costly war in Iraq, unprecedented spending for 
hurricane relief in the Gulf, and the escalating budget deficit, and it 
is very clear that now is the wrong time for these kinds of cut taxes.
  Mr. Speaker, the Democrats have a fair and responsible solution. It 
is fair because, instead of cutting taxes for the super rich, our 
substitute bill is designed to put hardworking middle-class Americans 
first in line for tax relief. For example, our substitute bill protects 
the majority of American families who will negatively be affected by 
the Alternative Minimum Tax. It is responsible because it avoids 
further reckless spending by eliminating the extension of capital gains 
and dividend tax cuts that will add to the enormous deficit that will 
have to be paid by future generations.
  As a grandmother myself, I believe it is morally reprehensible to 
leave my grandchildren to bear the burden of debt-relief because we 
spent our money on more tax cuts for the wealthy today.
  To set the right course for future generations, we must make it our 
priority to improve the quality of life for all Americans; not just the 
lives of the privileged few. This tax-cut bill before us is needless, 
reckless spending and should be rejected.
  Mrs. MALONEY. Mr. Speaker, after five years of setting records for 
weak job creation, the President is giving us a rosy outlook for our 
economy. What he fails to mention in his economic pep talks is the 
elephant sitting in the room--this administration continues to set 
record debts and deficits, long-term, structural problems that will bog 
us down for generations to come.
  What is our response as a Congress to this fiscal mess? A bill that 
would cost $81 billion over 10 years. A bill that would pile on to the 
deficit that is projected to be $3.5 trillion over 10 years. I suppose 
the thinking is compared to $3.5 trillion, what's another $81 billion? 
Only in Washington.
  What's worse, the middle class--the foundation of our Nation and our 
economy will be largely ignored by the bill before us. It's bad enough 
that working Americans have already been left behind in our economic 
recovery.
  But this bill will essentially raise taxes on 17 million American 
middle-class families by failing to protect them from the Alternative 
Minimum Tax. Make no mistake, they will not get real protection from 
yesterday's fig-leaf AMT bill, and they will get nothing from the bill 
before us today.
  We are considering more of the same. More debt, more deficits, more 
working Americans who are ignored.
  I urge my colleagues to vote ``no'' on this bill and ``yes'' on the 
sensible Rangel substitute, which will allow us to really fix the AMT, 
help the middle class and help working Americans.
  Mr. MOORE of Kansas. Mr. Speaker, I rise today to express my 
opposition to H.R. 4297, the FY05 tax reconciliation bill.
  I do not oppose tax cuts, and in a more stable fiscal climate I could 
support reduced tax rates for capital gains and dividend income. What I 
do oppose is borrowing money to pay for tax cuts, and particularly for 
tax cuts that do not expire for another three years.
  In 2001, I was one of only 28 House Democrats to vote for President's 
Bush's 2001 tax cuts that reduced marginal income tax rates. Since 
2001, however, our country's fiscal condition has dramatically reversed 
course. In 2001, the Congressional Budget Office (CBO) predicted that 
the 10-year budget surplus would be $5.6 trillion. That projected 10-
year surplus of $5.6 trillion has deteriorated into a projected $3.9 
trillion deficit during the same period. In FY2005, the Federal 
Government ran a budget deficit of $319 billion, the third largest 
deficit in our Nation's history.
  Further, on February 17, 2004, the national debt of the United States 
exceeded $7 trillion for the first time in our country's history. On 
October 21, 2005, the national debt of the United States exceeded $8 
trillion for the first time in our country's history. That is an 
increase of $1 trillion in our national debt over the last 2 years. It 
took our country 193 years, from 1787 to 1980, to rack up $1 trillion 
in debt, and just under two years, from 2004-2005, to match that level 
of borrowing.
  An $8 trillion national debt comes down to nearly $27,000 per person 
in our country, and that is simply unacceptable. The first rule of 
holes is that when you're in a hole and you don't want to go deeper, 
stop digging. It is now past time that we stop digging our country 
deeper and deeper into debt, leaving our children and grandchildren to 
pay a steep price for the deficits and debt we are adding to today.
  Mr. Speaker, H.R. 4297 extends several tax relief measures, including 
reduced rates for capital gains and dividend income, that I support and 
would vote for in a balanced, revenue neutral measure. I support: the 
saver's credit; small business and brownfields expensing relief; the 
Work Opportunity Tax Credit; the research and experimentation credit; 
deductions for higher education and classroom expenses; the exclusion 
for active financing income; and 15-year depreciation rates for 
restaurant equipment and improvements to leased property. 
Unfortunately, the Joint Tax Committee estimates that H.R. 4297 will 
cost $56.1 billion over the next five years, and the CBO estimates that 
extending the dividend and capital gains tax reductions alone would 
cost approximately $160 billion from FY2008 to FY2015.
  Further, unlike the Senate tax reconciliation bill, the House version 
of this legislation does not address what is arguably the most 
significant looming tax concern for middle-class American families, 
namely the growing number of Americans who are forced to pay the 
alternative minimum tax (AMT). While reduced rates for capital gains 
and dividend income will not expire for another three years, AMT relief 
is scheduled to expire in less than one month, at the end of this year.
  If AMT relief is allowed to lapse, the number of taxpayers subject to 
the AMT will increase from 3 million in 2004 to 21 million in 2006. The 
Congressional Budget Office estimates that extending AMT relief and 
indexing it for inflation would reduce federal revenue by $191 billion 
over the next five years. This is an immediate problem that Congress 
and the Administration need to work together to fix in a responsible, 
bipartisan way, before millions of Americans are hit with large, 
unexpected tax increases.
  Mr. Speaker, I will continue to work with my colleagues in both 
parties to advance commonsense, bipartisan approaches to solving our 
country's fiscal problems. I urge my colleagues on both sides of the 
aisle to act as soon as possible, in a fiscally sound way, to prevent 
serious consequences for current and future generations.
  Mrs. DAVIS of California. Mr. Speaker, weeks after passing a spending 
bill that failed to reflect our national values, we are repeating our 
mistakes with today's tax cut bill.
  We are once again ``robbing Peter to pay Paul''--only this time we 
have picked the worst possible time to do so.
  The holiday season is supposed to be a time for giving.
  Only this year, it has become a time for giving primarily to the 
wealthiest 20% of American families.
  Upper-income families will not lose much under last month's spending 
cuts bill.
  But they will benefit greatly from today's tax cut package.
  Conversely, lower- and middle-income families will suffer great 
losses under the spending cut bill . . .
  . . . yet stand to gain very little from today's tax bill.
  That's what I call ``Scrooge-onomics.''
  We continue to dig ourselves deeper and deeper into debt.
  The bill before us today comes with a price tag of $56 billion, with 
no means to offset that cost.
  And what do we get in return?
  If you are not among the top tier of wealthiest Americans, not much.
  Thirty-six percent of the cost of this bill goes towards extending 
reduced tax rates for capital gains and dividends.
  That's $20.6 billion dedicated to tax breaks that aren't even 
scheduled to expire until 2008.
  That's $20.6 billion that could be spent on education, worker 
training, affordable housing, or improving the quality of life for 
service members and their families.
  It is fiscally irresponsible to spend $56 billion we do not have on 
those who do not need it.
  And it is unwise to further complicate an already complex tax code to 
do so.
  That is why I am supporting the Democratic substitute to this bill.
  This substitute still extends vital tax cuts but includes offsets to 
pay for the cost, taking the burden off American taxpayers.
  It extends the Work Opportunity Tax Credit and the deduction of 
higher-education expenses.
  It extends the research and experimentation credit and the expensing 
of brownfield sites.
  It protects millions of California's taxpayers by extending sorely 
needed alternative minimum tax relief.
  And, importantly for my district of San Diego, California, it extends 
a critical provision allowing military personnel to elect to include 
combat pay as earned income.
  This allowance will expand the pool of armed services personnel 
eligible to receive

[[Page 27795]]

the earned income credit, and it will even increase this credit for 
some military families.
  The brave men and women who sacrifice time with their own families to 
protect ours deserve no less.
  Although this bill would be out of place at any time of year, it is 
unconscionable during the holiday season.
  A nation as prosperous as ours should never ignore its weakest 
citizens for the sake of tax cuts for the wealthy.
  I do not believe this bill reflects our priorities as a nation.
  I know it does not reflect my own values.
  Yet it does represent the true colors of the majority party.
  In the spirit of giving, I hope you will join me in opposing a bill 
that regards only the wealthy as worthy of receiving.
  Mr. MEEHAN. Mr. Speaker, I rise today to oppose the Republican tax 
bill.
  As we approach the end of the year, I wonder `How will this year be 
remembered?' For the deepening quagmire in Iraq? Will we remember 2005 
as a year of hardships? For Katrina, for Rita?
  Certainly this has been a year of great economic difficulties for low 
and middle income families. The poorest residents of the gulf coast 
were most affected by the devastating hurricanes, and the poorest 
Americans have shouldered a disproportionate share of the burden in 
Iraq.
  The Republican tax bill is just another example of the disdain the 
Majority in Congress has for its low and middle income citizens. 
Recently, this Congress cut Food Stamps, student loans, child support 
and Medicaid.
  Now the Administration is rewarding the rich. In the proposed tax 
cuts, over 50% of the Capital Gains and Dividends Rate Cut will benefit 
people who make more than one million dollars. The 55% of American 
households that make less than $40,000 will get a tax break of only $7 
while the households that make more than $1 million will receive an 
average tax break of $32,000.
  I support responsible spending, and balancing the budget, but this 
tax cut and the budget cuts of last month accomplish neither of these 
goals. In fact, these bills will actually increase the deficit by $16 
billion. And at what benefit? So that some of our wealthiest citizens 
can save a few extra dollars?
  President Bush has gone on the offensive. He is touting an improved 
economy by pointing to job statistics from this most recent quarter. 
But the economy is not improving where we need it to. Middle class 
Americans are worse off than they were 4 years ago. The average two-
earner family needs to work more to pay for health care, housing, 
college, and transportation than they did in 2001.
  Middle class families are forced to work more and save less. This 
means less time to spend with family and less money to put away for 
retirement.
  This is not how I want to remember 2005. I don't want to remember 
2005 as a year that the government heaped unnecessary burdens upon 
American families. Stealing from the poor and middle class and giving 
to the rich, while increasing the deficit, is hardly responsible. I 
urge you to vote no on the Republican tax cuts.
  Mr. LEACH. Mr. Speaker, reluctantly I rise to oppose a bill which has 
a number of provisions I support and others which I might have been 
inclined to back in a different economic and historical context. But 
this Congress jeopardizes America's fiscal house as it continues to 
``pay'' for a war with tax cuts. This is, after all, the first time in 
our history--and perhaps the history of the world--in which a 
government has sent soldiers into combat at the same time it has 
reduced the public's tax burden. And just as war cannot be paid for 
with tax cuts, social balance cannot be maintained if the costs of 
rebuilding one region of the country devastated by hurricanes are 
coupled with the reduction of support for needy citizens in other 
areas.
  I am an advocate of tax simplification--the replacement of a 
deduction-centric tax code with a simplified lower rate system. But I 
have doubts about taking the radical step of eliminating social 
progressivity with a flat, single-rate tax. The complexity of the 
current system is the result of a myriad of tax rules, not the fact 
that rates are slightly staggered. What has been missed in today's 
debate is that the taxation of dividend income at substantially lower 
levels than earned income means that the working middle class will be 
taxed at much steeper rates than upper-income citizens. The approach on 
the table today will not only eliminate tax progressivity, it will 
create an inverted tax system, one that is profoundly regressive.
  No tax system can stand the test of common sense if a high school 
principal, electrician, or registered nurse are taxed at a higher rate 
than a billionaire who receives his income from dividends. Yes, there 
is an argument that taxing dividend income may, in some cases, 
represent ``double'' taxation, but this concern is not as compelling as 
many assume because the deduction-oriented tax codes allow many large 
companies to have negligible income tax liabilities. This is why, 
according to a University of Michigan study, many of America's largest 
estates have been subjected to surprisingly little, if any, taxation in 
the accumulating years.
  Priorities are askew. When Congress attempts to cover the cost of 
man-made wars and nature-made hurricanes while expanding tax breaks 
that disproportionately benefit higher income individuals, it is forced 
to limit spending on programs for low-income students and our needier 
citizens to keep the fiscal deficit from skyrocketing.
  As long as this war continues, Congress is obligated to keep its eye 
not only on fiscal responsibility, but social justice. If it does not 
pay attention to fairness, the kind of internal strife that has broken 
out in recent weeks in France and the kind of internal division which 
was evidenced in the wake of Katrina in New Orleans will be magnified 
at great social cost.
  A thriftier government may be a credible goal, but Congress is 
obligated to pay for whatever commitments it makes. I did not vote for 
the Iraq war primarily because of policy rather than expense concerns. 
But there is a cost dimension and the burden of responsibility for 
funding public commitments falls at this time particularly on those who 
chose to authorize this war. Failure to accept this responsibility 
weighs down the public balance sheet and pushes payment of debt 
obligations to future generations.
  Accordingly, I am compelled to register my opposition to the fiscal 
irresponsibility implicit in this resolution.
  Ms. McCOLLUM of Minnesota. Mr. Speaker, I rise in strong opposition 
to the irresponsible Republican tax giveaways proposed in H.R. 4297. 
The Republican bill provides tax cuts for the wealthy few in our 
society by slashing critical services for vulnerable Americans and 
adding to our already exploding deficit.
  I am appalled that the majority party has slashed food stamps, health 
care and student loans for vulnerable and middle-income families to pay 
for tax breaks for the Nation's most fortunate. The top priority--63 
percent of the spending--in the Republican tax reconciliation bill is 
to extend capital gains and dividend tax cuts from 2008 to 2010.
  Forty-five percent of the benefits of this provision will go to 
millionaires. In addition, this bill, even combined with the 
devastating cuts, will add $81 billion to the deficit over the next 10 
years.
  The Republican bill focuses on benefits for their wealthiest 
contributors and fails to address tax changes that are necessary for 
the middle class. This bill does not include a provision to protect 
families from tax increases from the alternative minimum tax. I 
supported the 1-year fix on the AMT that this House passed because this 
is a critical issue for families in my district. However, this 
provision should have been included in this reconciliation package and 
should have been a priority for this Congress.
  In total, the Republican reconciliation package includes tax 
increases of up to $3,640 for middle income families due to the 
alternative minimum tax, increases of $5,800 per student for their 
college education, and a loss of access to health care and nutrition 
for many struggling families. It also adds to a spiraling deficit 
already projected to reach $640 billion by 2015. At the same time, 
Republicans will provide an average tax break of $32,000 to the wealthy 
few. This is an outrage and should be an embarrassment for this 
Congress.
  Mr. Speaker, America can do better. Congress should put forward a 
budget that is fiscally responsible, prioritizes our families, and does 
not threaten our children and grandchildren's future by increasing the 
Federal deficit.
  I urge my colleagues to reject this irresponsible, immoral budget 
plan.


     Amendment in the Nature of a Substitute Offered by Mr. Rangel

  Mr. RANGEL. Mr. Speaker, I offer an amendment in the nature of a 
substitute.
  The SPEAKER pro tempore (Mr. Gingrey). The Clerk will designate the 
amendment.
  The text of the amendment is as follows:

       Amendment in the nature of a substitute printed in House 
     Report 109-330 offered by Mr. Rangel:
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE, ETC.

       (a) Short Title.--This Act may be cited as the ``Tax Relief 
     Extension Reconciliation Act of 2005''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in

[[Page 27796]]

     this Act an amendment or repeal is expressed in terms of an 
     amendment to, or repeal of, a section or other provision, the 
     reference shall be considered to be made to a section or 
     other provision of the Internal Revenue Code of 1986.
       (c) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title, etc.

         TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006

Sec. 101. Allowance of nonrefundable personal credits against regular 
              and minimum tax liability.
Sec. 102. State and local general sales taxes.
Sec. 103.  Research credit.
Sec. 104. Qualified tuition and related expenses.
Sec. 105. Certain expenses of elementary and secondary school teachers.
Sec. 106. Qualified Zone Academy Bonds.
Sec. 107. Tax incentives for business activities on Indian 
              reservations.
Sec. 108. Deduction for corporate donations of computer technology and 
              equipment.
Sec. 109. Availability of medical savings accounts.
Sec. 110. 15-year cost recovery for leasehold improvements.
Sec. 111. 15-year cost recovery for restaurant improvements.
Sec. 112. Taxable income limit on percentage depletion for oil and 
              natural gas produced from marginal properties.
Sec. 113. District of Columbia Enterprise Zone.
Sec. 114. Possession tax credit with respect to American Samoa.
Sec. 115. Parity in the application of certain limits to mental health 
              benefits.
Sec. 116. Election to include combat pay under earned income credit.
Sec. 117. Work opportunity credit.
Sec. 118. Welfare-to-work credit.
Sec. 119. Extension of expensing of environmental remediation costs.
Sec. 120. Temporary relief from the alternative minimum tax.

  TITLE II--REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES WITH 
                        INCOMES OVER $1,000,000

Sec. 201. Reduction in benefit of rate reduction for families with 
              incomes over $1,000,000.

                  TITLE III--MISCELLANEOUS PROVISIONS

Sec. 301. Modification of active business definition under section 355.
Sec. 302. Veterans' mortgage bonds.
Sec. 303. Capital gains treatment for certain self-created musical 
              works.
Sec. 304. Vessel tonnage limit.
Sec. 305. Clarification of taxation of certain settlement funds.

         TITLE I--EXTENSIONS OF CERTAIN PROVISIONS THROUGH 2006

     SECTION 101. ALLOWANCE OF NONREFUNDABLE PERSONAL CREDITS 
                   AGAINST REGULAR AND MINIMUM TAX LIABILITY.

       (a) In General.--Paragraph (2) of section 26(a) (relating 
     to special rule for taxable years 2000 through 2005) is 
     amended--
       (1) in the text by striking ``or 2005'' and inserting 
     ``2005, or 2006'', and
       (2) in the heading by striking ``2005'' and inserting 
     ``2006''.
       (b) Conforming Provisions.--
       (1) Subsection (i) of section 904 (relating to coordination 
     with nonrefundable personal credits) is amended by striking 
     ``or 2005'' and inserting ``2005, or 2006''.
       (2) The amendments made by sections 201(b), 202(f), and 
     618(b) of the Economic Growth and Tax Relief Reconciliation 
     Act of 2001 shall not apply to taxable years beginning during 
     2006.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 102. STATE AND LOCAL GENERAL SALES TAXES.

       (a) In General.--Subparagraph (I) of section 164(b)(5) 
     (relating to application of paragraph) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 103. RESEARCH CREDIT.

       (a) Extension.--
       (1) In general.--Subparagraph (B) of section 41(h)(1) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (2) Conforming amendment.--Subparagraph (D) of section 
     45C(b)(1) (relating to special rule) is amended by striking 
     ``December 31, 2005'' and inserting ``December 31, 2006''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to amounts paid or incurred after December 31, 
     2005.
       (b) Increase in Rates of Alternative Incremental Credit.--
       (1) In general.--Subparagraph (A) of section 41(c)(4) 
     (relating to election of alternative incremental credit) is 
     amended--
       (A) by striking ``2.65 percent'' and inserting ``3 
     percent'',
       (B) by striking ``3.2 percent'' and inserting ``4 
     percent'', and
       (C) by striking ``3.75 percent'' and inserting ``5 
     percent''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.
       (c) Alternative Simplified Credit for Qualified Research 
     Expenses.--
       (1) In general.--Subsection (c) of section 41 (relating to 
     base amount) is amended by redesignating paragraphs (5) and 
     (6) as paragraphs (6) and (7), respectively, and by inserting 
     after paragraph (4) the following new paragraph:
       ``(5) Election of alternative simplified credit.--
       ``(A) In general.--At the election of the taxpayer, the 
     credit determined under subsection (a)(1) shall be equal to 
     12 percent of so much of the qualified research expenses for 
     the taxable year as exceeds 50 percent of the average 
     qualified research expenses for the 3 taxable years preceding 
     the taxable year for which the credit is being determined.
       ``(B) Special rule in case of no qualified research 
     expenses in any of 3 preceding taxable years.--
       ``(i) Taxpayers to which subparagraph applies.--The credit 
     under this paragraph shall be determined under this 
     subparagraph if the taxpayer has no qualified research 
     expenses in any one of the 3 taxable years preceding the 
     taxable year for which the credit is being determined.
       ``(ii) Credit rate.--The credit determined under this 
     subparagraph shall be equal to 6 percent of the qualified 
     research expenses for the taxable year.
       ``(C) Election.--An election under this paragraph shall 
     apply to the taxable year for which made and all succeeding 
     taxable years unless revoked with the consent of the 
     Secretary. An election under this paragraph may not be made 
     for any taxable year to which an election under paragraph (4) 
     applies.''.
       (2) Coordination with election of alternative incremental 
     credit.--
       (A) In general.--Section 41(c)(4)(B) (relating to election) 
     is amended by adding at the end the following: ``An election 
     under this paragraph may not be made for any taxable year to 
     which an election under paragraph (5) applies.''.
       (B) Transition rule.--In the case of an election under 
     section 41(c)(4) of the Internal Revenue Code of 1986 which 
     applies to the taxable year which includes the date of the 
     enactment of this Act, such election shall be treated as 
     revoked with the consent of the Secretary of the Treasury if 
     the taxpayer makes an election under section 41(c)(5) of such 
     Code (as added by subsection (a)) for such year.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 104. QUALIFIED TUITION AND RELATED EXPENSES.

       (a) In General.--Subsection (e) of section 222 (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (b) Limitations.--Paragraph (2) of section 222(b) (relating 
     to applicable dollar limit) is amended by striking 
     subparagraphs (A) and (B), by redesignating subparagraph (C) 
     as subparagraph (B), and by inserting before subparagraph (B) 
     (as so redesignated) the following:
       ``(A) 2006.--In the case of a taxable year beginning in 
     2006, the applicable dollar amount shall be equal to--
       ``(i) in the case of a taxpayer whose adjusted gross income 
     for the taxable year does not exceed $65,000 ($130,000 in the 
     case of a joint return), $4,000,
       ``(ii) in the case of a taxpayer not described in clause 
     (i) whose adjusted gross income for the taxable year does not 
     exceed $80,000 ($160,000 in the case of a joint return), 
     $2,000, and
       ``(iii) in the case of any other taxpayer, zero.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to payments made in taxable years beginning after 
     December 31, 2005.

     SEC. 105. CERTAIN EXPENSES OF ELEMENTARY AND SECONDARY SCHOOL 
                   TEACHERS.

       (a) In General.--Subparagraph (D) of section 62(a)(2) 
     (relating to certain expenses of elementary and secondary 
     school teachers) is amended by striking ``or 2005'' and 
     inserting ``2005, or 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to expenses paid or incurred in taxable years 
     beginning after December 31, 2005.

     SEC. 106. QUALIFIED ZONE ACADEMY BONDS.

       (a) In General.--Paragraph (1) of section 1397E(e) 
     (relating to national limit) is amended by striking ``and 
     2005'' and inserting ``2005, and 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to obligations issued after December 31, 2005.

     SEC. 107. TAX INCENTIVES FOR BUSINESS ACTIVITIES ON INDIAN 
                   RESERVATIONS.

       (a) Indian Employment Tax Credit.--
       (1) In general.--Subsection (f) of section 45A (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.

[[Page 27797]]

       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply to taxable years beginning after December 31, 
     2005.
       (b) Accelerated Depreciation for Business Property on 
     Indian Reservations.--
       (1) In general.--Paragraph (8) of section 168(j) (relating 
     to termination) is amended by striking ``December 31, 2005'' 
     and inserting ``December 31, 2006''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply with respect to property placed in service after 
     December 31, 2005.

     SEC. 108. DEDUCTION FOR CORPORATE DONATIONS OF COMPUTER 
                   TECHNOLOGY AND EQUIPMENT.

       (a) In General.--Subparagraph (G) of section 170(e)(6) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to contributions made in taxable years beginning 
     after December 31, 2005.

     SEC. 109. AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.

       (a) In General.--Paragraphs (2) and (3)(B) of section 
     220(i) (defining cut-off year) are each amended by striking 
     ``2005'' each place it appears in the text and headings and 
     inserting ``2006''.
       (b) Conforming Amendments.--
       (1) Paragraph (2) of section 220(j) is amended--
       (A) in the text by striking ``or 2004'' each place it 
     appears and inserting ``2004, or 2005'', and
       (B) in the heading by striking ``or 2004'' and inserting 
     ``2004, or 2005''.
       (2) Subparagraph (A) of section 220(j)(4) is amended by 
     striking ``and 2004'' and inserting ``2004, and 2005''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.
       (d) Time for Filing Reports, Etc.--
       (1) The report required by section 220(j)(4) of the 
     Internal Revenue Code of 1986 to be made on August 1, 2005, 
     shall be treated as timely if made before the close of the 
     90-day period beginning on the date of the enactment of this 
     Act.
       (2) The determination and publication required by section 
     220(j)(5) of such Code with respect to calendar year 2005 
     shall be treated as timely if made before the close of the 
     120-day period beginning on the date of the enactment of this 
     Act. If the determination under the preceding sentence is 
     that 2005 is a cut-off year under section 220(i) of such 
     Code, the cut-off date under such section 220(i) shall be the 
     last day of such 120-day period.

     SEC. 110. 15-YEAR COST RECOVERY FOR LEASEHOLD IMPROVEMENTS.

       (a) In General.--Clause (iv) of section 168(e)(3)(E) 
     (relating to 15-year property) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 111. 15-YEAR COST RECOVERY FOR RESTAURANT IMPROVEMENTS.

       (a) In General.--Clause (v) of section 168(e)(3)(E) 
     (relating to 15-year property) is amended by striking 
     ``January 1, 2006'' and inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 112. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR 
                   OIL AND NATURAL GAS PRODUCED FROM MARGINAL 
                   PROPERTIES.

       (a) In General.--Subparagraph (H) of section 613A(c)(6) 
     (relating to oil and natural gas produced from marginal 
     properties) is amended by striking ``January 1, 2006'' and 
     inserting ``January 1, 2007''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 113. DISTRICT OF COLUMBIA ENTERPRISE ZONE.

       (a) Period for Which Designation Applicable.--Subsection 
     (f) of section 1400 (relating to time for which designation 
     applicable) is amended by striking ``December 31, 2005'' both 
     places it appears and inserting ``December 31, 2006''.
       (b) Tax-Exempt Economic Development Bonds.--Subsection (b) 
     of section 1400A (relating to period of applicability) is 
     amended by striking ``December 31, 2005'' and inserting 
     ``December 31, 2006''.
       (c) Zero Percent Capital Gains Rate.--
       (1) In general.--Subsection (b) of section 1400B (relating 
     to DC Zone Asset) is amended by striking ``January 1, 2006'' 
     each place it appears and inserting ``January 1, 2007''.
       (2) Conforming amendments.--
       (A) Paragraph (2) of section 1400B(e) (relating to gain 
     before 1998 and after 2010 not qualified) is amended--
       (i) by striking ``December 31, 2010'' and inserting 
     ``December 31, 2011'', and
       (ii) by striking ``2010'' in the heading and inserting 
     ``2011''.
       (B) Paragraph (2) of section 1400B(g) (relating to sales 
     and exchanges of interests in partnerships and S corporations 
     which are DC Zone businesses) is amended by striking 
     ``December 31, 2010'' and inserting ``December 31, 2011''.
       (C) Subsection (d) of section 1400F (relating to certain 
     rules to apply) is amended by striking ``December 31, 2010'' 
     and inserting ``December 31, 2011''.
       (d) First-Time Homebuyer Credit for District of Columbia.--
     Subsection (i) of section 1400C (relating to application of 
     section) is amended by striking ``January 1, 2006'' and 
     inserting ``January 1, 2007''.
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall take effect on January 
     1, 2006.
       (2) Tax-exempt economic development bonds.--The amendment 
     made by subsection (b) shall apply to obligations issued 
     after the date of the enactment of this Act.

     SEC. 114. POSSESSION TAX CREDIT WITH RESPECT TO AMERICAN 
                   SAMOA.

       (a) In General.--Subparagraph (A) of section 936(j)(8) 
     (relating to special rules for certain possessions) is 
     amended by inserting before the period at the end the 
     following: ``(before January 1, 2007, in the case of American 
     Samoa)''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 115. PARITY IN THE APPLICATION OF CERTAIN LIMITS TO 
                   MENTAL HEALTH BENEFITS.

       (a) In General.--Paragraph (3) of section 9812(f) (relating 
     to application of section) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Effective Dates.--The amendment made by subsection (a) 
     shall take effect on the date of the enactment of this Act.

     SEC. 116. ELECTION TO INCLUDE COMBAT PAY UNDER EARNED INCOME 
                   CREDIT.

       (a) In General.--Subclause (II) of section 32(c)(2)(B)(vi) 
     (defining earned income) is amended by striking ``January 1, 
     2006'' and inserting ``January 1, 2007''.
       (b) Special Rule.--The amount of any refund to which an 
     individual is entitled by reason of amendment made by 
     subsection (a) shall not exceed the aggregate liability 
     reflected in the individual's tax account (determined by 
     taking into account the taxable year and all prior taxable 
     years).
       (c) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 117. WORK OPPORTUNITY CREDIT.

       (a) In General.--Subparagraph (B) of section 51(c)(4) 
     (relating to termination) is amended by striking ``December 
     31, 2005'' and inserting ``December 31, 2006''.
       (b) Increase in Age Limit for Food Stamp Recipients.--
     Clause (i) of section 51(d)(8)(A) (relating to qualified food 
     stamp recipient) is amended by striking ``25'' and inserting 
     ``35''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to individuals who begin work for the employer 
     after December 31, 2005.

     SEC. 118. WELFARE-TO-WORK CREDIT.

       (a) In General.--Subsection (f) of section 51A (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to individuals who begin work for the employer 
     after December 31, 2005.

     SEC. 119. EXTENSION OF EXPENSING OF ENVIRONMENTAL REMEDIATION 
                   COSTS.

       (a) In General.--Subsection (h) of section 198 (relating to 
     termination) is amended by striking ``December 31, 2005'' and 
     inserting ``December 31, 2006''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to expenditures paid or incurred after December 
     31, 2005.

     SEC. 120. TEMPORARY RELIEF FROM THE ALTERNATIVE MINIMUM TAX.

       (a) In General.--Section 55 (relating to alternative 
     minimum tax imposed) is amended by adding at the end the 
     following new subsection:
       ``(f) Exemption for Individuals for Taxable Years Beginning 
     in 2006.--For any taxable year beginning in 2006, in the case 
     of an individual--
       ``(1) In general.--The tentative minimum tax of the 
     taxpayer shall be zero if the adjusted gross income of the 
     taxpayer (as determined for purposes of the regular tax) is 
     equal to or less than the threshold amount.
       ``(2) Phasein of liability above exemption level.--In the 
     case of a taxpayer whose adjusted gross income exceeds the 
     threshold amount but does not exceed $112,500 ($225,000 in 
     the case of a joint return), the tax imposed by subsection 
     (a) shall be the amount which bears the same ratio to such 
     tax (determined without regard to this subsection) as--
       ``(A) the excess of--
       ``(i) the adjusted gross income of the taxpayer (as 
     determined for purposes of the regular tax), over
       ``(ii) the threshold amount, bears to
       ``(B) $12,500 ($25,000 in the case of a joint return).
       ``(3) Threshold amount.--For purposes of this paragraph, 
     the term `threshold amount' means $100,000 ($200,000 in the 
     case of a joint return).
       ``(4) Estates and trusts.--This subsection shall not apply 
     to any estate or trust.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

[[Page 27798]]



  TITLE II--REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES WITH 
                        INCOMES OVER $1,000,000

     SEC. 201. REDUCTION IN BENEFIT OF RATE REDUCTION FOR FAMILIES 
                   WITH INCOMES OVER $1,000,000.

       (a) General Rule.--Section 1 (relating to imposition of tax 
     on individuals) is amended by adding at the end the following 
     new subsection:
       ``(j) Reduction in Benefit of Rate Reduction for Families 
     With Incomes Over $1,000,000.--
       ``(1) In general.--If the adjusted gross income of a 
     taxpayer exceeds the threshold amount, the tax imposed by 
     this section (determined without regard to this subsection) 
     shall be increased by an amount equal to 1.45 percent of so 
     much of the adjusted gross income as exceeds the threshold 
     amount.
       ``(2) Threshold amounts.--For purposes of this subsection, 
     the term `threshold amount' means--
       ``(A) $1,000,000 in the case of a joint return, and
       ``(B) $500,000 in the case of any other return.
       ``(3) Tax not to apply to estates and trusts.--This 
     subsection shall not apply to an estate or trust.
       ``(4) Special rule.--For purposes of section 55, the amount 
     of the regular tax shall be determined without regard to this 
     subsection.
       ``(5) Termination.--This subsection shall not apply to 
     taxable years beginning after December 31, 2010.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.
       (c) Section 15 not to Apply.--The amendment made by 
     subsection (a) shall not be treated as a change in a rate of 
     tax for purposes of section 15 of the Internal Revenue Code 
     of 1986.

                  TITLE III--MISCELLANEOUS PROVISIONS

     SEC. 301. MODIFICATION OF ACTIVE BUSINESS DEFINITION UNDER 
                   SECTION 355.

       Subsection (b) of section 355 (defining active conduct of a 
     trade or business) is amended by adding at the end the 
     following new paragraph:
       ``(3) Special rule relating to active business 
     requirement.--
       ``(A) In general.--In the case of any distribution made 
     after the date of the enactment of this paragraph and before 
     December 31, 2010, a corporation shall be treated as meeting 
     the requirement of paragraph (2)(A) if and only if such 
     corporation is engaged in the active conduct of a trade or 
     business.
       ``(B) Affiliated group rule.--For purposes of subparagraph 
     (A), all members of such corporation's separate affiliated 
     group shall be treated as one corporation. For purposes of 
     the preceding sentence, a corporation's separate affiliated 
     group is the affiliated group which would be determined under 
     section 1504(a) if such corporation were the common parent 
     and section 1504(b) did not apply.
       ``(C) Transition rule.--Subparagraph (A) shall not apply to 
     any distribution pursuant to a transaction which is--
       ``(i) made pursuant to an agreement which was binding on 
     the date of the enactment of this paragraph and at all times 
     thereafter,
       ``(ii) described in a ruling request submitted to the 
     Internal Revenue Service on or before such date, or
       ``(iii) described on or before such date in a public 
     announcement or in a filing with the Securities and Exchange 
     Commission.

     The preceding sentence shall not apply if the distributing 
     corporation elects not to have such sentence apply to 
     distributions of such corporation. Any such election, once 
     made, shall be irrevocable.
       ``(D) Special rule for certain pre-enactment 
     distributions.--For purposes of determining the continued 
     qualification under paragraph (2)(A) of distributions made 
     before the date of the enactment of this paragraph as a 
     result of an acquisition, disposition, or other restructuring 
     after such date and before December 31, 2010, such 
     distribution shall be treated as made after the date of the 
     enactment of this paragraph for purposes of applying 
     subparagraphs (A) through (C) of this paragraph.''.

     SEC. 302. VETERANS' MORTGAGE BONDS.

       (a) All Veterans Eligible for State Home Loan Programs 
     Funded by Qualified Veterans' Mortgage Bonds.--
       (1) In general.--Paragraph (4) of section 143(l) (defining 
     qualified veteran) is amended--
       (A) by striking ``at some time before January 1, 1977'' in 
     subparagraph (A), and
       (B) by striking subparagraph (B) and inserting the 
     following:
       ``(B) who applied for the financing before the date 25 
     years after the last on which such veteran left active 
     service.''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply to financing provided after the date of the 
     enactment of this Act.
       (b) Revision of State Veterans Limit.--
       (1) In general.--Subparagraph (B) of section 143(l)(3) 
     (relating to volume limitation) is amended to read as 
     follows:
       ``(B) State veterans limit.--
       ``(i) In general.--A State veterans limit for any calendar 
     year is the amount equal to--

       ``(I) $53,750,000 for the State of Texas,
       ``(II) $66,250,000 for the State of California,
       ``(III) $25,000,000 for the State of Oregon,
       ``(IV) $25,000,000 for the State of Wisconsin, and
       ``(V) $25,000,000 for the State of Alaska.

       ``(ii) Phasein.--In the case of calendar years beginning 
     before 2010, clause (i) shall be applied by substituting for 
     each of the dollar amounts therein by the applicable 
     percentage. For purposes of the preceding sentence, the 
     applicable percentage shall be determined in accordance with 
     the following table:

Calendar Year:                                Applicable percentage is:
2006.........................................................20 percent
2007.........................................................40 percent
2008.........................................................60 percent
2009........................................................80 percent.

       ``(iii) Termination.--The State veterans limit for any 
     calendar year after 2010 is zero.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to bonds issued after December 31, 2005.

     SEC. 303. CAPITAL GAINS TREATMENT FOR CERTAIN SELF-CREATED 
                   MUSICAL WORKS.

       (a) In General.--Subsection (b) of section 1221 (relating 
     to capital asset defined) is amended by redesignating 
     paragraph (3) as paragraph (4) and by inserting after 
     paragraph (2) the following new paragraph:
       ``(3) Sale or exchange of self-created musical works.--At 
     the election of the taxpayer, paragraphs (1) and (3) of 
     subsection (a) shall not apply with respect to any sale or 
     exchange before January 1, 2011, of musical compositions or 
     copyrights in musical works by a taxpayer described in 
     subsection (a)(3).''.
       (b) Limitation on Charitable Contributions.--Subparagraph 
     (A) of section 170(e)(1) is amended by inserting 
     ``(determined without regard to section 1221(b)(3))'' after 
     ``long-term capital gain''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to sales and exchanges in taxable years beginning 
     after the date of the enactment of this Act.

     SEC. 304. VESSEL TONNAGE LIMIT.

       (a) In General.--Paragraph (4) of section 1355(a) (relating 
     to qualifying vessel) is amended by inserting ``(6,000, in 
     the case of taxable years beginning after December 31, 2005, 
     and ending before January 1, 2011)'' after ``10,000''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 305. CLARIFICATION OF TAXATION OF CERTAIN SETTLEMENT 
                   FUNDS.

       (a) In General.--Subsection (g) of section 468B (relating 
     to clarification of taxation of certain funds) is amended to 
     read as follows:
       ``(g) Clarification of Taxation of Certain Funds.--
       ``(1) In general.--Except as provided in paragraph (2), 
     nothing in any provision of law shall be construed as 
     providing that an escrow account, settlement fund, or similar 
     fund is not subject to current income tax. The Secretary 
     shall prescribe regulations providing for the taxation of any 
     such account or fund whether as a grantor trust or otherwise.
       ``(2) Exemption from tax for certain settlement funds.--An 
     escrow account, settlement fund, or similar fund shall be 
     treated as beneficially owned by the United States and shall 
     be exempt from taxation under this subtitle if--
       ``(A) it is established pursuant to a consent decree 
     entered by a judge of a United States District Court,
       ``(B) it is created for the receipt of settlement payments 
     as directed by a government entity for the sole purpose of 
     resolving or satisfying one or more claims asserting 
     liability under the Comprehensive Environmental Response, 
     Compensation, and Liability Act of 1980,
       ``(C) the authority and control over the expenditure of 
     funds therein (including the expenditure of contributions 
     thereto and any net earnings thereon) is with such government 
     entity, and
       ``(D) upon termination, any remaining funds will be 
     disbursed to such government entity for use in accordance 
     with applicable law.

     For purposes of this paragraph, the term `government entity' 
     means the United States, any State or political subdivision 
     thereof, the District of Columbia, any possession of the 
     United States, and any agency or instrumentality of any of 
     the foregoing.
       ``(3) Termination.--This subsection shall not apply to 
     accounts and funds established after December 31, 2010.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to accounts and funds established after the date 
     of the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to House Resolution 588, the 
gentleman from New York (Mr. Rangel) and the gentleman from Michigan 
(Mr. Camp) each will control 30 minutes.
  The Chair recognizes the gentleman from New York.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we have a Democrat substitute that really is not in 
sharp

[[Page 27799]]

conflict with the Republican bill. Many things we tried and include and 
did suggest in the brief time we had to work on this bill. Basically, 
what we have done, though, is to pay more attention to the middle class 
that really are the victims of the alternative minimum tax than we pay 
attention to the richest of America who do not find their Republican 
tax cuts being threatened until 2009. Why did we do this? Is it merely 
a technicality? It is a very important difference.
  Yes, we voted on the Suspension Calendar to provide relief for these 
people, not as much as we do in our substitute; but people have to 
understand the Suspension Calendar in the House is not protected under 
the other body's rules. They protected those people that they wanted to 
protect, those enjoying capital gains and will continue to enjoy 
capital gains and corporate dividend tax cuts until 2009. Why would 
they not include right in this bill, that would be protected on the 
other side, I do not know their political reasons.
  But I do know this: what we refuse to do is to give tax cuts that 
would extend the deficit. We do not do that to generations that follow. 
Nor do we hit the poor who are sick or the kids that want to go to 
school or the foster kids or those kids that are dependent on money 
from their fathers who have abandoned their mothers. We do not do it in 
this season, nor do we do it anytime, because there is a difference in 
what we believe in.
  I am suggesting this: if Members support the substitute, you are 
supporting deductions for State and local taxes, real estate taxes, the 
deduction for college tuition, the research credit they talk about that 
we agree is so important, the work opportunity tax credit, tax 
incentives for the District of Columbia and for Indian reservations, 
15-year depreciation period for leasehold improvements and restaurant 
improvements, qualified zone academic bonds, the brownfields cleanups, 
and several other important, but minor, provisions.
  What I am suggesting is that the major decision of those of you who 
will have to vote is whether or not you want to give $20 billion of tax 
relief to people who would not need it until 2009 at the expense not 
only of the deficit but at the expense of the poorest among us; or 
whether you want to take the good things that we could find in this 
bill, not increase the deficit and not cut the programs for the poor, 
and have a Democratic substitute that makes sense to the American 
people and, hopefully, to the House of Representatives.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would say to my friend from New York that we have 
dealt with the AMT issue. In our legislation, we did not choose to 
raise taxes, as the gentleman's substitute does, to the tune of $40 
billion. So because of that, the AMT is done outside of the 
reconciliation process.
  When I hear so many on the other side of the aisle talk about high-
income earners, I remind Members that many small businesses in the 
United States file as individuals. So when they have this $40 billion 
tax increase, that is really on small businesses and the families that 
those small businesses support. According to the Treasury Department, 
80 percent of the people affected by the $40 billion tax increase in 
their substitute are small and entrepreneurial businesses. That is the 
engine of job creation in America, and that is why our economy has 
recovered, because we have helped those small businesses.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from 
Michigan (Mr. Levin), a distinguished member of the Committee on Ways 
and Means.
  Mr. LEVIN. Mr. Speaker, the issue here is priorities and choices. 
There are some similarities, but the differences are vast. Let us look 
at the whole picture here, the whole picture.
  You have an alternative minimum tax that is going to hit millions of 
people if we do not act. We have $45 billion in extenders on which 
there is basic agreement. We have a reduction in the capital gains and 
dividends tax which continues for the next few years. We have proposed 
budget cuts. We also have the alleged, by the Republicans, need for 
fiscal discipline.
  So what are their choices, because you cannot really do everything. 
So here is their choice: extend the dividends and capital gains 
reduction that continues in any event, extend it to 2009 and 2010 even 
though over 50 percent goes to people making $1 million a year. That is 
their first choice.
  Their second choice is budget cuts: cuts in student loans, cuts in 
child support. And I want to say to my colleague from Michigan, 
administrative money for child support goes to raise money for 
children, not for bureaucrats. It is 4 to 5 dollars for every dollar we 
provide in administrative support. Essentially, what the Republicans do 
is to reduce the amount of money going to kids over the next 10 years 
by $24 billion.
  Their choice also was to leave out the AMT from this bill, but then 
they bring up a bill yesterday, do not pay for it, and it can be 
objected to in the Senate and may not happen at all. So their choice is 
clear: tax relief that goes to people making a million bucks or more 
and cutting student loans, cutting food support for people who need it, 
and cutting child support which will mean reductions of $24 billion 
over the next 10 years. That is what the choices are here.
  Mr. Speaker, they do not even maintain fiscal discipline, because if 
the AMT thing were to happen, it would be unpaid for and would add to 
the deficit. Our substitute has very different priorities. I urge its 
adoption.

                              {time}  1300

  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
Pennsylvania (Ms. Hart), a distinguished Member of the Ways and Means 
Committee.
  Ms. HART. Mr. Speaker, I rise in opposition to the Democrat 
substitute. This proposal actually does not continue some very 
important provisions for low income Americans. It does not extend a 
savers credit which actually allows a match for savings for poorer 
people by the government. Their substitute does not include an 
expensing provision for small businesses that allows them to use more 
of their money instead of sending it to the government so that they can 
grow their business and create jobs. It does not allow a provision that 
provides tax benefits to those who clean up brownfield sites to 
encourage new job creation in some of our older towns. It does not 
include the most important provision, which is the reduced rate on 
capital gains and dividends that has created all of these new jobs.
  Now, you do not have to be an economist to understand these lines. On 
the left-hand side, you see all the bars below the line. On the right-
hand side, all the bars are above the line. And what do those bars 
represent? Well, on the first half it is from January 2001 until we 
passed the capital gains and dividends tax reductions.
  Interestingly enough, taxes were high, investment was low. These bars 
show job losses. All of the bars underneath the line are job losses. We 
passed the capital gains cut, the dividends cut, what happens? 
Businesses save more of their money, reinvest, create jobs. All the 
bars above the line, they show an average job gain, per month, since we 
passed the capital gains and dividends cuts of 148,700 jobs. That is 
just an average. As you can see, some months were higher than others, 
but across the board we created almost 150,000 jobs a month as a result 
of a provision that the Democrat substitute would cancel.
  I urge my colleagues to cancel the Democrat substitute.
  Mr. RANGEL. There must be some chart around to show how many people 
were pushed into poverty during that same period of time and our wages 
have been reduced, but we have it in the back if any of our Members 
would like to use it.
  Mr. Speaker, I yield 3 minutes to the gentleman from Maryland (Mr. 
Cardin), a distinguished Member of our Ways and Means Committee.

[[Page 27800]]


  Mr. CARDIN. Mr. Speaker, let me thank the gentleman from New York for 
yielding me this time, and thank him for putting together a substitute 
that makes sense, that is an important bill. Yes, it is important to 
extend the expiring tax provisions, and the Rangel substitute does 
that. Research and development, the work opportunity tax credit, all 
the important tax provisions that will expire, the substitute extends 
those provisions. That is important.
  The Rangel substitute does another thing that is extremely important. 
It deals with the alternative minimum tax affecting 16 million of our 
taxpayers of the 19 million that are under the alternative minimum tax. 
That is very important to get done. And the Rangel substitute deals 
with that. The Rangel substitute deals with other inequities in the Tax 
Code, correcting them and getting them done right. But the substitute 
does one more thing that is very important to be done, and that is it 
is fiscally responsible. It does not add to the national debt. We have 
huge deficits, and where do you think we get our money in order to pay 
the bills? Money is coming, not from foreign investors or U.S. 
investors, it is coming primarily from foreign-owned banks who are 
buying our currency not because it is a good investment, they are 
buying it in order to have a favorable exchange rate with the U.S. 
dollar so that they can send more products here into the United States.
  It is important that we be fiscally responsible, that we do not add 
to the deficit. The Concord Coalition, a nonpartisan group that is only 
interested in trying to deal with the national debt, said that tax cuts 
need at a minimum to be offset, that we should not add to the deficit 
through the tax bills.
  The Rangel substitute pays for these tax reliefs. It is fiscally 
responsible. It not only provides relief in the Tax Code that we need 
to provide for the taxpayers of this country, it does not burden this 
Nation and the future generations. And by the way, it is also good for 
growth. Our deficit hurts growth in this country. The Rangel substitute 
is sensitive to the need for us to make sure that we are on the right 
glide path to create jobs in our economy. Mr. Speaker, this is the 
right thing to do. We want to provide tax relief, but we should do it 
in a way that does not burden our children and grandchildren.
  I urge my colleagues to support the Rangel substitute.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas 
(Mr. Brady), a distinguished Member of the Ways and Means Committee.
  Mr. BRADY of Texas. I appreciate my colleague from Michigan, his 
leadership in helping boost our economy, extend this tax relief. I 
strongly support the original bill over the substitute. The substitute 
takes a step backward in how we treat our soldiers and how we treat our 
families, small businesses that are affected by the alternative minimum 
tax, compared to legislation that this House passed just yesterday, we 
treated soldiers better, by providing them immediate cash refunds on 
their tax treatment. I do not want to step back from that today in the 
substitute. We help 2\1/2\ million more families and small businesses 
with their alternative minimum tax yesterday, again, almost nearly 
unanimously.
  I do not want to step back from that with this substitute. And the 
original bill provides three provisions that are really helpful for a 
lot of families in this country. It extends for 1 year the sales tax 
deduction, which provides every family in the country a choice to 
deduct either their state and local income taxes or their State and 
local sales taxes. What it means is sales taxes, as you know, add up a 
great deal, add up fast for families. This tax relief just stretches 
the family paycheck a little farther and prevents hundreds of millions 
of dollars of tax increases on families that would start right after 
this Christmas holiday. That would be unfair. The original bill extends 
this. This also provides help to universities that receive dollars, 
higher education from the public higher education utility fund that 
extends a provision that helps provide more higher education dollars 
for certain universities. And then it also, for 10 states, allows more 
veterans to get low interest home loans in order when they come back 
from the war in Iraq and the war on terrorism to get an opportunity to 
get that first home. That is very important to a state like Texas. I 
strongly support the underlying bill as very important tax relief for 
this country.
  Mr. RANGEL. Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from 
Tennessee (Mr. Tanner), an outstanding member of this committee who 
truly understands the problem of the deficit.
  Mr. TANNER. Mr. Speaker, I think the American people just want to 
hear us try to get along and give them the level, be on the level with 
them, give them straight talk.
  What has happened here in the last several years is we have reduced 
revenues with bills like this and increased spending. Now, you can do 
that for a little while, and all of us have done it from time to time, 
I assume, with our credit cards. But you cannot do it forever and every 
American knows that.
  To give you some recent history, in 2002, we had to increase the debt 
limit of money that we could borrow by $450 billion in this country. In 
2003, we had to increase it again by $984 billion. In 2004, again, by 
$800 billion. And in the budget resolution, it is not in this bill, 
they propose another $781 billion increase in the limit that we can 
borrow.
  Now, what that means is, since 2001, the Federal debt has grown from 
5.6 to $8.1 trillion. This is available on www.publicdebt.treas.gov. Do 
not take my word for it. Go, please, look it up. In 2004, 16 of 23 
Federal agencies could not provide an acceptable audit. That is 
available at www.gao.gov. Right now, mainland China and Hong Kong have 
accumulated over $300 billion worth of our debt. That data is available 
on the Treasury Department's Web site. Again, this is not an argument. 
This is fact. Go look it up. I said the other day when I was talking, 
things are so bad with our borrowing out of control that if China 
attacked Taiwan, we would have to borrow the money from China to defend 
Taiwan. 16 percent of all the taxes we collect now in this country go 
to pay interest. And it gets worse by the minute. Interest on the 
public debt grew more rapidly than any other spending category in the 
Federal Government last year. In 2005 we paid in checks $184 billion, 
in checks. If you assume that we continue to do these tax bills without 
paying for them, the GAO projects that in the year 2040, every dime 
collected by this government will go to pay interest on past 
consumption on interest only debt.
  Now, what does that mean? Where are we now? This is hard to imagine, 
but so far, in this fiscal year, we have borrowed $130 billion and 
spent $39 billion on interest in just the first 2 months of this fiscal 
year. November's $22 billion payment was the largest ever. Debt 
interest grew more rapidly in the first 2 months, 38 percent, relative 
to the same rate last year. The Federal Reserve is raising interest 
rates and has 12 times. Really, all I am saying is this. We are on an 
unsus-
tainable financial glide path and every reputable economist will tell 
you that. We want to work with the Republicans. We want to try to do 
tax relief when it makes sense and makes more commerce happen and so 
forth. But we cannot do it because we cannot reach the real problem.
  You know what the problem is around here? You let the PAYGO rules 
lapse in 2002. We do not have meaningful enforceable budget caps. We do 
not have a balanced budget amendment that has ever been voted on. And 
what we have is a failure of not only communication but a failure of 
management of the budget process. And we are getting deeper and deeper 
in trouble by the minute.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from 
Missouri (Mr. Blunt), the distinguished majority leader.
  Mr. BLUNT. Mr. Speaker, I am in opposition to the substitute because 
I am for the underlying bill and I am for the things it has done for 
our economy. One of the great changes that this bill showed in what 
happens in the Federal Government is a belief that people are better at 
solving economic problems

[[Page 27801]]

than government is. When the tax structure that we are voting today to 
extend was put in place, the determination was made that we were in a 
difficult economic time, and the way to get out of that difficult 
economic time was to trust the people, not to come up with some big 
complicated government program, but to trust the people to let them 
keep more of their money, to put some minor incentives in the Tax Code 
to do whatever they wanted to do sooner, rather than later, but no 
incentive in the Tax Code to do a specific thing.
  The incentive was to trust the American people to see what we could 
do to get the economy growing again and going again, and that is what 
has happened. But this is no time for that to stop. This is no time to 
say we should put the brakes on this economy, just because the 
unemployment rate is lower than the average of the 1970s, 1980s and 
1990s. It is still 5 percent. We should want it to be lower than that. 
Just because income to the Federal Government increased last year at a 
rate three times the projection, the highest increase in Federal 
Government ever without a tax increase, how did that happen? It 
happened because the economy was working. It happened because more 
people had jobs, that $100 billion that came in in the fiscal year that 
ended September 30 that we did not anticipate, did not come in by 
accident. It came in because of a strong and growing economy. What the 
underlying bill does is say, let us not increase taxes. Let us keep the 
tax structure that is growing this economy in place. Let us send a 
signal that that tax structure is in place, at least until 2010, and it 
makes a difference.

                              {time}  1315

  I was listening to the debate earlier, and so much of the debate 
earlier was about wealthy Americans. Amazingly, those same Americans 
yesterday were the upper middle class. Overnight somehow the upper 
middle class became wealthy Americans.
  But not just the upper middle class benefits from this. All Americans 
benefit from this in their own way. In the reduction in the capital 
gains rate, one out of five people that take advantage and benefit from 
the capital gains rate has an income below $50,000. Fifty-eight percent 
of the people that have a benefit from that have an income below 
$100,000.
  The capital gains, I know these people, as other Members do. The 
janitor at school who has figured out how his renters help him pay for 
two rental houses, and every time the pipes freeze, he is crawling 
under that rental house. It has depreciated down to where the value for 
tax purposes may not be very high, but it is everything that man or 
woman had been able to accumulate, and that person benefits greatly 
from this 15 percent rate. Why raise that rate back? Why send a signal 
that that rate is going to go back?
  The dividend tax, six times as many companies are paying dividends to 
people that own the company today as were paying dividends in just 2003 
when we made that change. And the numbers are about the same. For the 
dividend rates, one out of four people that benefit from that tax make 
under $50,000. Fifty-nine percent of the people that benefit from that 
tax make under $100,000. Those are the same people that on this floor 
yesterday we talked about how important it was they not be negatively 
affected by the alternative minimum tax. I agree with that. So did 
everybody but four people on the floor of the House that voted 
yesterday.
  I agree that we ought to continue these tax policies that are working 
for America. That means we need to reject the substitute, even a 
substitute from my good friend (Mr. Rangel), and move to the underlying 
bill and keep this economy growing.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  I have all the respect for the majority leader, and it is true that 
he knows some of these people that have gone from upper middle income 
to become higher-income people, and there are other people in this 
country that have seen middle-income people slip into the rolls of 
poverty. So in order to have a more well-balanced bill, we concentrated 
on the middle class by putting the alternative minimum tax into this 
bill to make certain that when it gets to the body, it is protected and 
we do not have to depend on just one of those people over there 
rejecting it for this higher tax cut, which, of course, does not 
adversely affect anybody, as the majority leader said, until 2009.
  Mr. Speaker, I yield 3 minutes to the gentleman from California (Mr. 
Becerra), a hardworking member of the Ways and Means Committee.
  Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, I urge the Members of this body to support the Rangel 
substitute.
  If we recall the words of a famous President this country had, a man 
of heroic proportions, Harry Truman, he said, ``The buck stops here.'' 
And, unfortunately, we are forgetting the words of Harry Truman because 
today it seems like the mantra of the leadership in this House of 
Representatives is the buck stops with your children or perhaps your 
grandchildren, because we are in a portion of our Nation's history 
where we have run up national deficits bigger than we have ever seen in 
our life. We run up deficits in 1 year that it would have taken 200 
years of Presidents to run up in the history of this Nation.
  Mr. Speaker, in a time of disasters, Rita, Katrina, on and on; in a 
time of massive deficits; and in a time of war, it is irresponsible to 
run up the Nation's debt. It is irresponsible to then give money to run 
up this debt and give it to the wealthiest Americans in this Nation. 
Mr. Speaker, it is irresponsible to put debt on top of massive debt 
when we know at the end of the horizon there is still more debt that 
will come in the years to come: $27,000 is what each and every man, 
woman, and child in this country owes as a result of our Nation's debt.
  It is irresponsible, Mr. Speaker, to take Social Security surplus 
money, which the President said back in 2001 he could protect and never 
touch as he moved forward with these tax cuts. It is irresponsible, Mr. 
Speaker, to take those Social Security surpluses and then contribute 
them to the wealthiest Americans. In essence, we are gifting the Social 
Security surplus moneys contributed by working Americans; we are 
gifting that to the wealthiest Americans in this country through these 
tax cuts.
  Mr. Speaker, it is irresponsible to move forward with these tax cuts 
at the same time that we are telling American families, mostly middle 
class that rely on student loans so they can send their young men and 
women to college, their young daughters and sons are going to have to 
pay $5,000 more a year in their student loans so we can take care of 
the 1 percent wealthiest Americans in this Nation in these bills. It is 
irresponsible, Mr. Speaker, to move forward in that way.
  It is irresponsible then to further say we still need to make more 
cuts and we need to go into the foster care program and take $600 
million out of the foster care program which helps us take a child out 
of an abusive home and move that child into a safe setting. It is 
irresponsible to take $5 billion out of a child support system that 
says to deadbeat dads that we are going to take money from them, we 
need to enforce that, to take $5 billion, make it into cuts, and 
therefore make it more impossible for us to get those deadbeat dads to 
help the mothers who are taking care of their sons and daughters in 
this country. It is irresponsible.
  Mr. Speaker, it is responsible when we have a Democratic substitute, 
as Mr. Rangel has, that says we are going to cut taxes, but in a 
targeted way, for the middle class, in a responsible way by making sure 
we pay for it so we do not increase the size of the deficit. And that 
is what should pass, Mr. Speaker.
  President Truman was right. The buck stops here. Let us do it today 
for ourselves. Let us not leave the debt to our children.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Virginia (Mr. Cantor), distinguished member of the Ways and Means 
Committee.

[[Page 27802]]


  Mr. CANTOR. Mr. Speaker, I rise in opposition to the substitute and 
in favor of the underlying bill.
  I want to talk about some of the allegations that have been brought 
up in this debate. One is the fact that perhaps by continuing the tax 
policies or extending the reduction in tax rate, especially in the area 
of tax dividends and capital gains tax, that somehow we are aggravating 
the deficit. I think that the evidence is pretty conclusive that we 
have seen a tremendous stimulus and tremendous growth in revenues 
because of this tax policy.
  If I could quote the Chairman of the Federal Reserve Board, back in 
June of this year he said: ``I do think that there are parts of the 
existing recent tax changes, especially with respect to eliminating 
part of the double taxation of dividends, which I think enhances 
economic growth, enhances the tax base and, therefore, tax revenues, 
and that it is good economic policy.''
  The second point that I think is being made in favor of the 
substitute and opposing the underlying bill is saying that the 
extension of the reduction in tax rates on cap gains and dividends 
somehow is a tax cut for the rich. I could not disagree more. And, in 
fact, our own Joint Committee on Taxation, on the AMT extension's 
impact, compares the two, the one that we acted on yesterday and the 
one today. The AMT extension impacts 14 million taxpayers; 62 million 
taxpayers benefit from reduced rates on cap gains and dividends. And 
per the most recent IRS data, 96 percent of taxpayers hit by the AMT in 
2003 had adjusted gross incomes in excess of $100,000. So it is clear.
  Furthermore, the Joint Economic Committee says that 60 percent of 
those paying capital gains taxes earn less than $50,000 annually; 85 
percent earn less than $100,000 annually.
  This is about jobs. This is about creating jobs for America's 
families, and I urge rejection of the substitute and passage of the 
underlying bill.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentlewoman from 
Ohio (Mrs. Jones), a distinguished member of the Ways and Means 
Committee.
  Mrs. JONES of Ohio. Mr. Speaker, I would like to compliment my 
chairman, Mr. Charles Rangel, for his leadership on this issue.
  I am glad to be on the Ways and Means Committee and glad to have the 
opportunity to talk about some of these taxing issues.
  It just amazes me that the majority can stand here and have the gall 
to tell veterans that they are going to treat them better, to tell the 
people of America that they are better at solving problems than the 
government and so we are going to give them two cents back to pay for a 
$100 bill; to have the gall to say that we are not going to create 
bigger government and then they created the biggest institution ever, 
the Homeland Security Department; and that has not taken care of poor 
people across this country, particularly the victims of Katrina and 
Rita as it goes on.
  But can you imagine they will not tell the American people the truth. 
They will not tell them that last week we reduced programs so that this 
week we could extend taxes that do not even need to be extended. Can 
you contemplate that the extension of the capital gains dividends is 
going to cost us $50.7 billion over the next 10 years.
  Now, work with me for a moment. If you work with me, you could 
understand that with that $50.7 billion, 12,571,089 people could have 
health care coverage; 959,230 elementary school teachers could be paid; 
7,331,106 Head Start places for children who need a head start could go 
back to school; 32,565,528 children could receive health care; and, 
more importantly, we could build 6,514 new elementary schools in these 
United States.
  But, instead, we are going to extend taxes beyond this year when we 
are still at war in Iraq and we are spending billions of dollars a day 
to give the Iraqi children what we will not even give our children 
right here at home.
  My math works better than that. See, I know one plus one equals two. 
I understand that it is these United States that is supposed to be 
taking care of our babies and giving them a chance to go to school and 
giving them a chance to go to college. And for them to have the gall to 
say that a janitor sitting on a stool is going to save some money or 
get some money on capital gains, give me a break.
  You know it is not the janitor sitting on the stool; you know it is 
the man who owns the janitorial company.
  Mr. CAMP of Michigan. Mr. Speaker, and the $40 billion in taxes in 
the Democrat substitute certainly will not give many Americans a break.
  Mr. Speaker, I yield 3 minutes to the gentleman from New York (Mr. 
Reynolds), a distinguished member of the Ways and Means Committee.
  Mr. REYNOLDS. Mr. Speaker, I thank the gentleman from Michigan for 
yielding me this time.
  Mr. Speaker, I rise today in strong support of H.R. 4297, the Tax 
Relief Extension Reconciliation Act of 2005, and in opposition to the 
Democrat substitute.
  Mr. Speaker, the Ways and Means bill before us today addresses a 
number of important priorities that are broadly supported by Members on 
both sides of the aisle. These include tax savings for higher education 
expenses, small business tax relief, tax incentives for research and 
development by U.S. companies that create good jobs. The bill also 
includes an extension of the lower rates for capital gains and 
dividends, an important priority for the ever-growing investor class 
that will keep our economy strong and our domestic job base growing.
  Mr. Speaker, as a lead sponsor of the Stealth Tax Relief Act of 2005, 
the legislation designed to prevent massive increases in the 
alternative minimum tax, or AMT, from sneaking up on millions of 
unsuspecting taxpayers next year, I want to take just a moment to 
comment on the Democrat substitute. Just 24 hours ago, the House passed 
my bill by an overwhelming bipartisan vote of 414-4. Together we sent a 
strong, unmistakable signal to our colleagues across the Capitol that 
extending the temporary AMT relief that is scheduled to expire in just 
a matter of weeks is an important priority that must be addressed.

                              {time}  1330

  But what does today's Democratic substitute do? Yes, it provides 
relief from AMT. To pay for it, the Democratic substitute increases 
taxes on families and on small businesses that create so many jobs in 
our community.
  Mr. Speaker, just yesterday all but four Members of the Democratic 
Party supported AMT relief in the House for our hardworking middle 
class without increasing taxes. But today, just 24 hours later, our 
friends on the other side of the aisle are back singing a familiar tax-
raising tune, one that always leaves families with less money in their 
wallets on April 15, and small businesses with less money on their 
balance sheets. The Democratic substitute should be defeated.
  Mr. Speaker, earlier in this debate, a colleague on the other side of 
the aisle claimed that the Republican majority has done little to fight 
the AMT since winning the House in 1994. To the contrary. Our 
Republican majority has repeatedly provided temporary AMT relief since 
we took control, an effort which we continued yesterday with the 
passage of the Stealth Tax Relief Act.
  I would further remind my friends on the other side of the aisle that 
in 1999 the Republican Congress sent a bill to the President's desk 
that would have repealed the AMT entirely. Unfortunately, no Democrats 
in the House supported that bill, and President Clinton vetoed it.
  Finally, I would remind Members that in 1993, as an era of the 
Democratic control was coming to an end, one of the last things that 
our friends on the other side of the aisle did was to provide a 
retroactive increase for the AMT without indexing the exemption levels.
  Mr. Speaker, I urge passage of our bill and defeat of the Democratic 
substitute.
  Mr. RANGEL. Mr. Speaker, I agree with my distinguished friend from 
New York (Mr. Reynolds) that the Republicans did send a signal to 
protect the alternative minimum tax. We want to do a lot more.

[[Page 27803]]

  Mr. Speaker, I yield 3 minutes to the gentleman from Washington (Mr. 
McDermott), who can explain the difference between what you want to do 
and what we want to do in this substitute.
  Mr. McDERMOTT. Mr. Speaker, you say one thing for political cover, 
and then you do another thing for your friends. That is what we are 
doing here today.
  Just last month the Speaker said, ``I will tell you that the most 
mean-spirited thing we can do is leave our children with a debt they 
cannot pay.'' That came from the Speaker. That did not come from our 
side. That is the authority of the majority in this House.
  Well, the words were right. But, you know, the Speaker knows, and I 
know him well, he went to a college where you know about the Bible. And 
there is a Bible verse that says, by their deeds ye shall know them. 
And it is the deeds out here that really make the difference.
  Now, the difference between what happened yesterday and what is 
happening in the gentleman from New York's bill is very simply this. 
Yesterday you sent a signal. You sent a press release. You sent a 
message out up into the ether knowing, absolutely knowing, it would not 
pass, because it is not protected in the Senate. You know that. You 
know how to run this place.
  You can confuse the people, but you cannot confuse anybody who knows 
what is going on in here. The fact is that the gentleman from New 
York's proposal is one that puts it in law and protects it so that we 
can do something about the AMT.
  Let me say something about the AMT. I bet you most people listening 
to this do not know what AMT stands for. It stands for alternative 
minimum tax. It was put in in 1986 because there were people at the top 
of the scale who were not paying one single penny of tax.
  So it was decided in this body that everybody who benefits from the 
United States of America should pay some taxes for a civil society. The 
failure to index that tax has allowed it to creep down to people making 
$75,000 or $100,000; and suddenly, instead of being a few people at the 
top, it is now 14 or 20 million, depending on how you want to figure. 
That was never the intent.
  From 1994 to the present, you have allowed it to go from covering 
200,000 people to 14-plus million people. You want to use that as an 
excuse for trying to get rid of the tax structure. And we know that it 
was intended and you know it was intended to tax everybody in this 
country.
  The repeal that you tried to put through here under Clinton was an 
attempt to let the top off taxes at all. You simply wanted to give them 
an internal tax holiday if they could figure out how to manipulate the 
tax structure. The average janitor does not have a way to manipulate 
the system.
  And that is why the gentleman from New York's (Mr. Rangel) is the 
only honest way if you want to protect the middle class. I urge your 
vote for the alternative minimum tax proposal.
  Mr. CAMP. Mr. Speaker, the current rate structure of the AMT was 
created by the Democrats in 1993 with no Republicans supporting the 
bill.
  I yield 2 minutes to the gentleman from Texas (Mr. Hensarling).
  Mr. HENSARLING. Mr. Speaker, unless we enact H.R. 4297 and defeat the 
Democratic substitute, Americans will receive a most unwelcome 
Christmas gift from the Democrats, a huge automatic tax increase. This 
will cost families billions of dollars and jeopardize millions of their 
jobs.
  Mr. Speaker, let me tell you just about a few of those jobs that 
could be lost in my east Texas district if the Democrats have their way 
in raising taxes. Hugh Dublin owns a small business called East Texas 
Right of Way in my district. He specializes in the leasing of land.
  Due to tax relief, his company has grown from two full-time employees 
to four full-time employees. His two new employees are called Dan and 
David. They were unemployed. They were out of work. But due to the 
expansion of this business, they were able to start new careers.
  The Democrats now want to raise taxes on Hugh Dublin and his small 
business. They want to jeopardize Dan and David's paychecks and replace 
them with welfare checks, and this they call compassion.
  Eddie Alexander owns Triple S Electric in Henderson, Texas, an 
electrical contracting business. Since the passage of our economic 
growth program with tax relief, he has been able to hire two more full-
time employees, Jared and John, both of whom were out of work, but both 
now provide homes for their families. The Democrats want to raise taxes 
on Eddie Alexander and his small business.
  They want to jeopardize Jared and John's paychecks and replace them 
with welfare checks, and this they call compassion.
  Gil Travers owns Travers & Company, a home building company in 
Athens, Texas. Due to the housing boom from tax relief, they have had 
to hire three new workers, Jan, Calvin and Christy. They were all 
previously unemployed. They have been hired to help clean up all of the 
job sites from the new homes.
  But the Democrats now want to raise taxes on Gil Travers and his 
small business. They want to jeopardize Jan's, Calvin's, and Christy's 
paychecks and replace them with welfare checks, and this they call 
compassion.
  Mr. Speaker, tax relief has credited 4.4 million new tax-paying jobs 
with a future: 4.4 million hardworking Americans can now provide for 
their families this Christmas. And more than just providing food and 
shelter, these jobs are providing new-found hope and opportunity. We 
cannot go back. We must prevent this Democratic tax increase.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from 
South Carolina (Mr. Spratt).
  Mr. SPRATT. Mr. Speaker, over the last few days we have seen a flurry 
of tax cuts on the House floor: three yesterday, another one, a big 
one, today. And over the last 6 months, four other bills have been 
enacted that have tax cuts and concessions built into them, for 
example, the Energy Policy Act.
  By breaking all of those tax cuts into small pieces and by burying 
them in other bills, not tax bills, the audit trail very quickly 
becomes hard to follow. It is hard to see the forest for the trees. 
Hard to see in the aggregate how all of these different tax cuts add 
up.
  So let us look at the revenue scorecard over the last 6 months, 
bearing in mind that every delay of revenues cut is a dollar added to 
the deficit. First of all, the highway bill: $500 million. The Energy 
Policy Act: $6.9 billion over 5 years. The Katrina Emergency Tax Relief 
Act: $6.1 billion over 5 years. The Stealth Tax Relief Act, the 1-year 
extension, or patch, to the AMT adopted yesterday: $31.2 billion. 
Today's bill: $56.1 billion. The bill we adopted yesterday, a 
miscellany of small tax cuts, but it adds up to $153 million. And 
finally the Gulf Opportunity Zone Tax Act which was passed yesterday: 
$7.1 billion.
  The total amount of all of these tax cuts comes to $108 billion. So 
if you pass this bill today, the total impact that you will have taken 
with today's vote and recent votes comes to 108.
  But wait, it is not over yet. Because there is a provision in this 
bill, a provision in our substitute, a provision in yesterday's bill 
that indicates something has got to be done about the alternative 
minimum tax. We are going to have to fix the alternative minimum tax. 
If you fix it for 5 years, not 1, the aggregate effect of this fix, of 
all of the other tax cuts along with it, comes to $301 billion over 5 
years.
  That is the sum total that these tax cuts will add to the deficit, 
$301 billion if you fix the AMT next year and the following years the 
same way we are fixing it this year. So the net effect on the deficit 
is $301 billion in all political reality.
  So every Member here who is in earnest about the deficit should be on 
notice. You have a choice: you can vote for the underlying bill and add 
$301 billion to the deficit over the next 5 years, or you can vote for 
this bill and provide middle-income tax relief and not add a dime to 
the deficit.
  Here, in effect, is what your choice is. We stand at a crossroads 
today that

[[Page 27804]]

CBO has depicted as follows on this particular chart. You can take this 
path here with $319 billion, or you can take this path here, and by 
2015, we can be nearly out of deficit.
  On the other hand, you can take the path that this bill would take, 
and you will be $640 billion in deficit in 10 years. The Democratic 
substitute is morally and fiscally far and away the better choice, 
particularly if you want to balance the budget and eradicate the 
deficit.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
Tennessee (Mrs. Blackburn).
  Mrs. BLACKBURN. Mr. Speaker, I rise to support the underlying bill 
and to oppose the substitute. And this is the reason why: my state, 
Tennessee, has seen more than $250 million in taxpayer savings a year 
from the sales tax deduction we passed in 2004.
  The Tax Relief Extension Act that we are passing today will extend 
that. There is no excuse not to support this matter of tax fairness for 
States like mine. It is great for our economy; it is great for 
Tennessee's Main Streets. And those hundreds of millions of dollars are 
being pumped back into those local economies.
  My State should not be penalized for choosing an alternative tax 
system. It is a better tax system. We want to keep it. I know many of 
my friends who are Blue Dogs supported the tax cut, and I hope that 
they are going to join us today and vote for the majority's bill. 
Tennesseeans are watching this vote.
  Mr. Speaker, I do not know how many different ways we are going to 
have to talk about this economy and the fact that it is booming, jobs 
creation, home sales up, productivity soaring; but some never let facts 
get in the way of their political agenda.
  If you read the New York Times, the Washington Post, or listen to 
many of my colleagues, you believe that our economy is dismal and we 
have not created a single solitary new job. One important thing the 
Federal Reserve noted: since we passed these tax relief measures in 
2003, American households have increased their nest eggs, their 
retirement security, their savings by $10.5 trillion, $10.5 trillion 
net worth development by American households.
  Finally, Mr. Speaker, this bill before us today, this bill has a 
provision that helps our Nation's songwriters. As chairman of the 
Congressional Songwriters Caucus, we worked to correct an inequity in 
the Tax Code that penalizes them when they sell their life's work. The 
bill solves that.
  I thank my friend from Kentucky (Mr. Lewis) and Chairman Thomas for 
their work on this issue.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from 
Maryland (Mr. Hoyer).

                              {time}  1345

  Mr. HOYER. Mr. Speaker, here we are just 2 weeks after House 
Republicans claimed that they were restoring fiscal discipline to the 
federal budget considering a tax bill that will make our deficits worse 
and drive our Nation even further into debt.
  In 5 short years, the Republican party's failed economic policies 
have instigated $1.57 trillion in budget deficits and added $3 trillion 
to the national debt. By the way, during the last 4 years of the 
Clinton administration, we added not a nickel to the national debt and 
all 4 years we had a surplus.
  Even Alan Greenspan, the chairman of the Federal Reserve, is sounding 
the alarm. He recently said, ``We should not be cutting taxes by 
borrowing.'' That is what we are doing. But with this bill Republicans 
are doing precisely that.
  Now the Republican response will be as predictable as it is wrong. 
They will claim that tax cuts pay for themselves, but at long last can 
we dispense with this supply-side snake oil. Last month the incoming 
chairman of the Federal Reserve told the Senate, ``I think it's unusual 
for a tax cut to completely offset the revenue loss.''
  That is President Bush's appointee to the Federal Reserve. And the 
Comptroller General of the United States, David Walker, recently 
stated, ``Anybody who says you're going to grow your way out of this 
problem, (deficits and debt) would probably not pass math.''
  Even the President's Council of Economic Advisers admitted in 2003, 
``Although the economy grows in response to tax reductions, it is 
unlikely to grow so much that lost tax revenue is completely recovered 
by the higher economic activity.''
  That is why we have $1.75 trillion in additional deficits in 5 years 
and $3 trillion of additional debt.
  So my Republican friends can stop pretending that the tax cuts in 
this bill will somehow magically pay for themselves. You are suggesting 
cuts twice as large as you were prepared to cut in spending. They will 
not.
  Finally, let me say that this tax bill perfectly illustrates the 
Republican party's misguided priorities. Its centerpiece is the capital 
gains and dividend cuts from 2008 to 2010. Who do you think benefits 
from that? Certainly not those making less than $50,000 a year. They 
will receive 3 percent of the capital gains tax cut. The fact is 80 
percent of the capital gains tax cuts go to those with incomes more 
than $200,000; and more than 50 percent goes to those with incomes over 
$1 million.
  Meanwhile, this majority has refused to address the alternative 
minimum tax within this bill, thereby exposing nearly one-third of 
taxpayers making between $75,000 and $100,000 to higher taxes next 
year.
  I urge my colleagues: Vote for fairness.
  Vote for fiscal sanity.
  Vote for the Democratic alternative.
  Mr. CAMP. Mr. Speaker, I yield 3 minutes to the gentleman from 
Missouri (Mr. Hulshof), a distinguished member of the Ways and Means 
Committee.
  Mr. HULSHOF. Mr. Speaker, I thank the gentleman for yielding me time.
  Mark Twain is probably the most famous constituent from my district 
and I think it was his quote that said, ``There are lies, there are 
damn lies, and there are statistics.''
  I would say probably folks that are back in my district are home from 
school today because we had snow. Maybe people are taking a break from 
Christmas shopping and tuning into the debate, and I suspect folks are 
a little perplexed and a little confused. I do not know what the middle 
class is in Los Angeles or Cleveland or New York City or Baltimore or 
Seattle; but I think that at least in my congressional district, if a 
family is making about $50,000 a year, they probably think themselves 
to be middle class.
  The Democratic substitute for that sector of folks making $50,000 or 
less, the Democratic substitute helps less than 200,000 taxpayers. Less 
than 200,000 taxpayers are helped by the Democratic substitute that are 
trying to sit around the kitchen table and pay their bills, wondering 
how they are going to pay for Christmas presents for their kids.
  If we extend the capital gains and dividend tax rate, almost 8 
million American taxpayers making $50,000 or less, the underlying bill, 
nearly 8 million taxpayers will be benefited, and I think the choice is 
clear.
  Now, let me say to my friend, and he is my friend from Maryland, he 
talked about failed economic policies. Well, over the last 2 years, 
since capital gains and dividends reductions were put into law, we have 
averaged a 4 percent growth to our GDP. 4,400,000 jobs have been added 
to our economy. Homeownership is up at an all-time high. Government 
revenues have increased 10 percent a year since the reduction in the 
cost of capital.
  The gentleman from Maryland talks about priorities. Earlier we heard 
from the chairman of the Democratic Congressional Campaign Committee, 
and in his usual acerbic way, brought up the specter of politics. The 
chairman of the DCCC talked about politics with his usual acerbic, and 
yet what I find interesting as we get close to the conclusion of this 
debate, there has been a very concerted effort by my friend from 
Maryland to reach out to the business community in an effort to make 
some political gains in the 2006 election.
  After the CAFTA vote, when only 14 of our colleagues on the other 
side voted for increasing our opportunities for trade. There has been 
somewhat of a, reported at least, concerted effort to reach out to the 
business community.
  This will be an interesting vote because we have with the Democratic

[[Page 27805]]

substitute a tax increase of $40 billion on businesses. And the 
underlying bill which, in fact, continues to reduce the cost of 
capital, so are we going to deny enhanced expensing for farmers and 
manufacturers? Are we going to tell those laborers and manufacturing 
companies not to purchase, not to invest, not to expand their plants. 
That is the choice. And for those again that at least talk to the 
business community, I think the choice is clear. Reject the substitute 
and vote for the underlying bill.
  Mr. RANGEL. Mr. Speaker, I yield for the purpose of making a 
unanimous consent request to the gentlewoman from Texas (Ms. Jackson-
Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, because the Republican tax 
bill raises the deficit $3 trillion and because of the valuable aspect 
of the substitute deductions for State and local retail taxes and other 
provisions for working Americans, I rise in support of the substitute 
and oppose the underlying bill.
  Mr. Speaker, we have before us a very important piece of legislation, 
H.R. 4297, the Tax Reconciliation Act. It is very important to 
understand this piece of legislation within the big picture the 
republicans are painting here. Just last month, the Republicans passed 
a bill called ``The Deficit Reduction Act.'' This was a spending cut 
bill that slashed funding to many vital programs my constituents depend 
on, including to Medicaid, student loans, food stamps, and child 
support programs. The Republicans lectured us on the need to make 
sacrifices to control the national debt. By passing the spending cut 
bill, the Republicans actually asked the poor, the downtrodden, the 
disabled and the young to sacrifice on behalf of the rest of the 
country.
  Now we are faced with the Tax Reconciliation Act, which will actually 
add $86 billion dollars to the deficit over the next 5 years. This 
proposed tax cut will not help the poor and middle class, either. An 
estimated 40 percent of the tax cuts will go to families with incomes 
of $1 million or more, and 84 percent of the major tax cuts in this 
bill will go to the richest 20 percent of families.
  In fact, under this bill, over 17 million middle class Americans will 
face a tax increase next year from the Alternative Minimum Tax (the 
AMT)! An important aspect of this bill is the House's failure to 
adequately address the AMT. The Alternative Minimum Tax was enacted 
over 35 years ago enacted to ensure that the richest Americans would 
pay their fair share of income tax. Unfortunately, when the AMT was 
enacted, Congress neglected to index the tax rates to inflation. The 
AMT has now begun to add extra burden to middle class taxpayers at an 
alarming rate. The senate bill provides $30 billion for AMT relief to 
the middle class, while the House republican leadership could only find 
$2.8 billion for this cause.
  Republicans couldn't find the money to adequately pay for AMT relief 
for the middle class. They can't find any money for tax relief for 
those affected by hurricane Katrina in the gulf coast. Last month, 
Republicans couldn't find the money to spare the elderly from Medicaid 
cuts, to spare the students from loan increases, or spare our children 
from child care cuts. They couldn't find the money because they are 
choosing to extend the dividend and capital gains tax cuts for the 
richest in our country. They also choose to pass the burden of paying 
for these tax cuts on to our children in the form of a huge deficit.
  This is not how we take care of our own in Texas, and this is not how 
we do things in the United States. The Republicans are launching an 
unabashed attack on the American way by ignoring the neediest in our 
country to give tax cuts to the richest.
  The Democrats have instead offered an amendment in the form of the 
substitute that is much more fiscally responsible and equitable. The 
Democratic Substitute extends for one year all temporary tax provisions 
that expire at the end of this year, similar to the majority's bill. 
The major difference, however is that the Democratic substitute 
addresses the problem of the AMT by eliminating all liabilities for 
middle class individuals. This will reduce the number of individuals 
that pay the AMT next year by 16 million people, to just over 3 million 
people. This provision would cost about $45 billion dollars, but would 
be fully offset by rolling back a portion of the tax cuts that would 
otherwise go to those with annual incomes of over $1 million for joint 
returns and $500,000 for other returns. The Democratic substitute, 
unlike the Republican option, is a fiscally responsible bill that goes 
to help those who really need it instead of the very rich.
  Mr. Speaker, the decision to vote up or down on this legislation 
isn't a blurry line involving political ideology; it isn't a debate of 
Republican vs. Democratic philosophy. The priorities in the republican 
bill are misguided. Congress should not be providing additional tax 
breaks for the rich less than a month after huge spending cuts aimed at 
the most vulnerable. In the end, this tax bill will either exacerbate 
our already large Federal deficits, or will force even deeper cuts in 
critically important domestic programs. I am strongly opposed to this 
legislation, and I implore my colleagues on both sides of the aisle to 
vote against these unreasonable cuts and instead consider the revenue 
neutral Democratic alternative.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York (Mr. Fossella).
  Mr. FOSSELLA. Mr. Speaker, I thank the gentleman for yielding me 
time. I rise to support the underlying bill and to oppose the 
Democratic substitute.
  The numbers three, four, and five come to mind. Three is basically a 
reflection of what our inflation rate is at; four for the percentage of 
which our economy is growing on an annual basis; and five for 
unemployment rate that exists in this country with historic lows.
  One way we can ensure that that number five comes even lower and that 
number four goes even higher is to support the underlying legislation. 
Why? Because it is proven to work. When you reduce the taxes and the 
penalties on the accumulation of capital, what we see is an economy 
that grows. So whether you are a small business owner in Staten Island 
or a small business owner in San Francisco, you are able to put more 
people to work and we watch our economy grow and grow and grow.
  My concern with the Democratic substitute is multi-fold. One is if 
you are sitting at home, for example, and you are waiting for your 
retirement, and in several years when your nest egg is about a half a 
million dollars, which is not that much money anymore for some folks I 
know living across the country, if the Democratic substitute prevails, 
you are looking at basically sending another check for $25,000 to the 
Federal Government. That is if you support the substitute.
  In addition, if you happen to be receiving dividends, and I know many 
people across the country in so-called investor class receive dividends 
on a regular basis, if the Democratic substitute prevails, you will be 
paying upwards of 20 percent more in taxes to the Federal Government. 
Not to mention the fact that the AMT, which penalizes upwards of 80 
percent of the people I know who filed in Staten Island and Brooklyn, 
are getting punished by the AMT, the Democratic substitute does not 
adequately address what the House passed yesterday.
  In conclusion, if we are for a pro-growth economy, if we are for 
bringing the unemployment rate down even further, if we are watching 
for our economy to grow even greater, if we are basically placing our 
faith in the American people and the entrepreneurs and the small 
business owners across country, let us not punish them with higher 
capital gains rates and dividend rates.
  Mr. RANGEL. Mr. Speaker, I reserve the balance of my time.
  Mr. CAMP. Mr. Speaker, I yield 4 minutes to the gentleman from 
Louisiana (Mr. McCrery), distinguished member of the Ways and Means 
Committee.
  Mr. McCRERY. Mr. Speaker, I thank the gentleman for yielding me time.
  Mr. Speaker, it is a curious application of tax benefits that have 
been left out of the minority substitute. Let me just go over a few of 
those because I think you will agree with me that it is curious which 
ones are left out.
  The savers credit for low income families. My friends on the other 
side of the aisle continually stand up for low income families and to 
their credit, why on earth would they leave out a strong incentive for 
low income families to save? They do. They leave out the savers credit. 
And that goes only to lower income families in this country. Generally, 
those on the other side of the aisle harp about the--I will not say 
evils, but the excess profits, some of the bad things that big business 
does in this country, and yet they leave out the tax benefit for small 
businesses in

[[Page 27806]]

this country, something known as section 179, expensing to help small 
businesspeople cope with the costs of keeping their businesses up to 
date, modernizing their businesses so that they can compete, so they 
can compete in the market place, sometimes with those big bad 
businesses. They leave that out.
  Tax benefits for cleaning up brown-
field sites. Brownfield sites are dirty sites, polluted sites where 
business has gone away. There is pollution there. They are usually the 
champions of the environment, cleaning up the environment. But they 
leave out that tax benefit to encourage cleaning up these dirty 
polluted sites. Very curious.
  Now, certainly there are a couple that they leave out that I can 
understand. They leave out an extension of the active finance section 
of subpart F. That is a lot of big words. What that means is this 
particular tax provisional allows companies in this country who conduct 
financial operations to compete on a level playing field with their 
competitors overseas. That is what this does that they leave out of 
their bill. It allows American companies to compete effectively with 
companies overseas. They leave that out. But then they, as I said, they 
do not particularly like big business.
  The one that gave them the most glee, of course, by leaving it out 
was capital gains and dividends. You have heard all the rhetoric, and I 
am sure you are confused about who benefits from these. The Joint Tax 
Committee, the committee that is vested with crunching the numbers in 
this Congress, has produced these statistics: For the capital gains 
tax, one in five Americans who claims capital gains on his tax return 
has income below $50,000. Fifty-eight percent of those who claim 
capital gains on their tax return have incomes below $100,000. Somewhat 
different from the statistics you have heard from the other side.
  Dividends are even better. One in four, 25 percent of Americans who 
have dividend income have incomes below $50,000; 59 percent have 
incomes below $100,000.

                              {time}  1400

  Nearly 60 percent of Americans who claim either capital gains or 
dividend income have incomes of $100,000 or less. That is basically 
middle class.
  Another thing that the minority sometimes likes to do, I think, is 
tax. They like taxes, and they want to increase taxes; and when they 
can double tax, boy, that is a real joy. That is what dividends do. 
That income has already been taxed once at the corporate level. They 
want to tax it again at the individual level as high a rate as 
possible.
  So those are the things they leave out of this bill, Mr. Speaker; and 
I hope we will reject the substitute.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Texas 
(Mr. Brady), a distinguished member of the Ways and Means Committee.
  Mr. BRADY of Texas. Mr. Speaker, it is, I think, a terrible mistake 
to leave out tax relief for dividends. These are the usually small 
amounts of money that go to people, many seniors, who have invested in 
a company; and these are the dividends that help ease their retirement.
  Back a few years ago, we saw a number of Wall Street companies go 
under, the Enrons, the WorldComs, all those dot-com technology 
companies. They had big stock prices. They had great pieces of paper 
saying they were wonderful companies, but the fact of the matter is 
they were built on thin air. What we did under this legislation is we 
said to the companies, prove that you have a solid profit-and-loss 
statement, you have real assets, show us the money; pay it out in 
dividends, we will lower the cost, lower the taxes on those dividends.
  Since we created this tax legislation, now Fortune 500 companies, one 
out of four that did not provide dividends in the past, are now 
providing real money to real people who have invested in them. In other 
words, we have changed the culture from what is good this quarter and 
what is good for my stock price to what is the best long term, real 
growth, solid businesses in America. We have changed the culture of 
Wall Street because of this dividend tax relief.
  It is very important we not go back to the bad old days of high stock 
prices but built on thin air. We need businesses that are in it for the 
long term, that pay cash to real people, that when my mom or your mom 
or some other senior invests they know they are going to get a chance 
for a solid dividend that they can actually keep because they invested. 
This dividend relief, Mr. Speaker, is vitally important.
  I oppose the Democrat substitute. I support keeping in dividend 
relief, both for our seniors and our investors, and to keep Wall Street 
honest.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from Florida 
(Mr. Shaw), a distinguished member of the Ways and Means Committee, 
chairman of the Trade Subcommittee.
  Mr. SHAW. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Very briefly, since the tax rate on capital gains and dividends was 
reduced in May of 2003, the economy has grown at an average rate of 4.1 
percent; 4.4 million new jobs have been created; government tax 
receipts have increased 10 percent annually.
  Now we are coming to a situation in 2008 where the capital gains rate 
is going to go up to 20 percent; dividends go back to ordinary income.
  What effect is this going to have on the economy to all of the sudden 
have that increase that we are looking at? The question has been, and I 
think it has been raised, as to what is the hurry, why do it. We want 
them to be able to have a tax rate that people can count on, one that 
people can look into the future as far as they could. I would like to 
extend it even further than that, but under reconciliation we are 
limited to the budget window.
  I think this is a good bill. I ask all the Members to reject the 
substitute and support the base bill.
  Mr. RANGEL. Mr. Speaker, it is my distinct honor to yield the 
remaining time to the gentlewoman from California (Ms. Pelosi) to close 
on our side, who represents the minority at this historic time.
  Ms. PELOSI. Mr. Speaker, I thank the distinguished gentleman from New 
York, our ranking member on the Ways and Means Committee, for yielding 
me the time. I thank you and our colleagues on the committee on the 
Democratic side for the excellent work you did in putting forth the 
Democratic alternative today. You have made an excellent case for your 
substitute and indictment against what the Republicans are doing.
  Let us talk about what is happening here today. A few weeks ago, 
right before Thanksgiving, there was a bill on the floor which was the 
Republican budget bill. So bad was this bill in terms of it not 
representing the values of our country that the religious community 
gathered in the rotunda of the Capitol of the United States, and they 
prayed that this Congress would make the right decisions and reject the 
Republican budget proposal.
  They asked some questions about why we would be giving tax cuts to 
the wealthiest people in our country while taking food out of the 
mouths of America's children. They said they were going to draw a moral 
line in the sand because a budget should be a statement of our national 
values, and what we care about in our country should be reflected in 
that budget.
  Today, we are talking about a tax bill which is hand-in-glove part of 
the reconciliation that the Republicans are putting forth. So 
embarrassed were they by their own budget and so embarrassed were they 
by this tax bill that they had to have 3 weeks come between the two of 
them so that the American people would separate the cause and effect of 
what they were doing with their budget bill that was poor in its 
values, poor in its priorities and increasing our deficit because of 
this tax bill today.
  Yesterday, they engaged in another sham, which was to pretend that 
they were giving alternative minimum tax relief for middle-class 
families in America. If they cared about middle-class families in 
America, they would have put that in this bill today which has the full 
protection as it goes over

[[Page 27807]]

to the Senate. They know that that bill they passed yesterday has no 
weight in the Senate. It does not have the protection of the 
parliamentary process on the Senate side, and the same applies to what 
they did to try to give the illusion that they were helping our men and 
women in combat so that they would qualify for the low-income tax 
credit. If they cared about them, they would have them in the bill 
today.
  This budget, as I said, should be a statement of our national values; 
and while we talk about that, let us talk about what those values are.
  America has always cherished the value of opportunity, and one place 
where that is possible for more Americans is in the issue of education. 
Taking these two bills together, we are giving tax cuts to the 
wealthiest people in America while we are putting a burden on our young 
people by saying that they will pay $5,800 more in their student loans 
so that we can give tax cuts to people making over $1 million a year. 
That is not a statement of our national values. That takes from our 
children their opportunity when we should be expanding it.
  Fairness. Fairness has always been a cherished American value. 
Fairness. We see that during the last 5 years, these 5 years of the 
Bush administration, 7 million more people in our country go to sleep 
hungry, without adequate food, because they cannot afford to buy food. 
Seven million more people, an increase of 12 percent, and what does 
this combination of reconciliation in order to give tax cuts to people 
making over $1 million a year, that cuts food stamps and takes many 
tens of thousand of children off the school lunch program do? As the 
religious community said, how can we as a country give tax cuts to the 
wealthiest and take food out of the mouths of our children? That is not 
about fairness. Fairness is an American value.
  Community. America has always been about community. Alexis de 
Tocqueville said it about the origins of our country, and community 
means safe neighborhoods, the safety of our people, homeland security 
and the rest. We are not putting adequate resources to COPS on the Beat 
or anything else in order for us to give these tax cuts at the high 
end. That is not about community. That is totally unfair, and it is 
diminishing opportunity.
  Let us take the value of responsibility, personal responsibility, 
fiscal responsibility, which should be the order of the day in this 
conversation here. The combination of their tax bill and their budget 
bill in reconciliation, which I do not blame them for separating by 3 
weeks because it is a total embarrassment with that, they are 
increasing the deficit. They are increasing the deficit by $20 billion 
in order to give tax cuts to the wealthiest Americans. They are putting 
the burden of debt on America's children, individual debt with their 
student loans and fiscal debt in terms of our national debt and what 
our kids will be burdened with.
  It is just totally irresponsible and at the same time increases the 
deficit. Democrats support pay-as-you-go. No deficit spending. If 
something is important to you, figure out how to pay for it, but do not 
make my children and grandchildren have to pay for it or anybody's 
children and grandchildren have to pay for it.
  Every opportunity I get I want to sing the praises of the Clinton 
administration. Coming out of that administration we were on a 
trajectory of 5.6 trillion with a TR, dollars in surplus. In the years 
of the Bush administration, that has been almost fully reversed, over 
$4 trillion in deficit, a swing of around $10 trillion, an incredible 
burden on the future, a tax on our children's future.
  And this is the party of fiscal responsibility? Republicans have 
completely abdicated that. The Democrats are the party of fiscal 
responsibility. We showed we can do it then. We can do it again. We 
should not today be catering to this appetite for deficits that the 
Republicans cannot seem to get over. It is just absolutely immoral, 
immoral for us to heap those deficits on our children.
  I want to commend my colleagues on the Democratic side for what they 
have done and put into their proposal. The House Democrats are 
committed to an America that works for everyone, not just the 
privileged few.
  Our Democratic substitute reflects the values of community by 
shielding the middle-class Americans from the alternative minimum tax 
in a bill that really counts, not in some suspension of yesterday that 
has no weight in the conference with the Senate; and it provides tax 
relief, the Democratic alternative does, for our soldiers in combat in 
the bill. That really matters as well.
  The Democratic substitute demonstrates fairness by not adding to the 
deficit; and it creates opportunities, spurring economic growth, 
generating jobs and supporting our small businesses.
  Our Democratic members on the committee have eloquently made an 
indictment against this budget which is immoral because of the $70 
billion in tax cuts, mostly for America's wealthiest. The Republican 
budget decimates the very initiatives that middle-class Americans rely 
upon to get ahead. The poor suffer, the rich benefit, the middle class 
is paying the bill.
  The number of people without health insurance has increased 4 years 
in a row. People are hungry, a 12 percent increase. The number of 
people who do not have health insurance has grown. They are cutting $45 
billion in Medicaid, a health insurance program that is mostly for 
America's poor children, many of them Katrina survivors.
  Alexis de Tocqueville talked about community in America. He wrote 
back to the French: ``America is great because America is good. If 
America ever ceases to be good,'' he concluded, ``America will cease to 
be great.''
  This is a moment that no one in this body wants to hasten. We all 
want America to be great and America to be good. Together, we can do 
better by returning to our fundamental values to maintain America's 
goodness by rejecting this immoral tax bill.
  Mr. CAMP. Mr. Speaker, I yield myself 2 minutes.
  Actually, in a few minutes we will have a vote on two tax bills, and 
we have heard a lot of debate this afternoon about the two approaches 
the bill takes, and I certainly appreciate my friends on the other side 
for recognizing the need for tax relief.

                              {time}  1415

  In fact, in many important ways these bills are very similar. Twenty-
two provisions in our underlying bill were taken by my friends on the 
other side and put into their bill. I guess imitation is the sincerest 
form of flattery.
  For example, the income tax deduction for State and local taxes; the 
research and development tax credit, so important to our high-tech and 
manufacturing sectors of our economy; the above-the-line deduction for 
higher education expenses; and the bonds for school modernization 
equipment and teacher training; as well as the enhanced charitable 
deduction for computer donations to schools. These are provisions that 
we have that are the same.
  What the Democrat substitute does not include is the extension of a 
saver's credit for low-income families; the expensing for small 
businesses so small entrepreneurs can grow their companies, buy the 
equipment, increase their businesses and hire more people; cleaning up 
brownfields sites so we can continue economic development in so many 
small towns and communities in our Nation; as well as helping our 
domestic manufacturers finance those large equipment sales overseas so 
we can export more.
  Also capital gains and dividends. We have heard a great deal about 
that this afternoon. That tax provision, that benefit, has helped 24 
million American families in this country. Twenty-five percent of those 
families have incomes under $50,000 a year. Are those the rich we hear 
talked about so much on the other side? Fifty-seven percent, almost 60 
percent of the families have incomes under $100,000 a year. Are those 
the very rich our friends on the other side are so worried about us 
assisting?
  What is irresponsible is the part of the Democrat substitute which 
raises taxes. Forty billion dollars in tax increases. And 80 percent of 
those taxes, that tax burden, would fall on small

[[Page 27808]]

entrepreneurial businesses. I urge a vote against the substitute and in 
favor of the underlying bill.
  Mr. Speaker, I yield the balance of my time to the gentleman from 
California (Mr. Thomas), the distinguished chairman of the Ways and 
Means Committee.
  Mr. THOMAS. Mr. Speaker, actually, I do not need 12 minutes, I only 
need 10 seconds. This bill is a----
  Mr. RANGEL. Parliamentary inquiry.
  The SPEAKER pro tempore (Mr. Bass). Does the gentleman from 
California yield for a parliamentary inquiry?
  Mr. THOMAS. No.
  Mr. RANGEL. Does the gentleman from California? A parliamentary 
inquiry is no longer the Speaker's responsibility?
  Mr. THOMAS. Mr. Speaker, who has the time?
  The SPEAKER pro tempore. The gentleman from California is recognized.
  Mr. RANGEL. Well, I just wanted to know how many closing speakers 
they had.
  The SPEAKER pro tempore. The gentleman from California has the time.
  Mr. THOMAS. Mr. Speaker, it is obvious the gentleman from New York 
wants to make sure you do not hear this.
  As I said, you do not need 12 minutes to say this: If you vote 
``yes'' for the Democrat substitute, you are increasing taxes over 5 
years by $40 billion.
  That is the single largest tax increase since they were in the 
majority in 1993.
  Mr. CAMP. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. Pursuant to House Resolution 588, the 
previous question is ordered on the bill, as amended, and on the 
amendment by the gentleman from New York (Mr. Rangel).
  The question is on the amendment offered by the gentleman from New 
York (Mr. Rangel).
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. RANGEL. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The vote was taken by electronic device, and there were--yeas 192, 
nays 239, not voting 2, as follows:

                             [Roll No. 619]

                               YEAS--192

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Becerra
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Butterfield
     Capps
     Capuano
     Cardin
     Cardoza
     Carnahan
     Carson
     Case
     Chandler
     Clay
     Cleaver
     Clyburn
     Conyers
     Cooper
     Costa
     Cramer
     Crowley
     Cuellar
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Doggett
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Gonzalez
     Gordon
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Herseth
     Higgins
     Hinchey
     Hinojosa
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick (MI)
     Kind
     Kucinich
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Leach
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren, Zoe
     Lowey
     Lynch
     Maloney
     Markey
     Matsui
     McCarthy
     McDermott
     McGovern
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Melancon
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore (KS)
     Moore (WI)
     Moran (VA)
     Nadler
     Napolitano
     Neal (MA)
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Salazar
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Schakowsky
     Schiff
     Schwartz (PA)
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Wasserman Schultz
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Wilson (NM)
     Woolsey
     Wu
     Wynn

                               NAYS--239

     Aderholt
     Akin
     Alexander
     Bachus
     Baker
     Barrett (SC)
     Barrow
     Bartlett (MD)
     Barton (TX)
     Bass
     Bean
     Beauprez
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boren
     Boustany
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Burgess
     Burton (IN)
     Buyer
     Calvert
     Camp (MI)
     Campbell (CA)
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole (OK)
     Conaway
     Costello
     Crenshaw
     Cubin
     Culberson
     Davis (KY)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     Dent
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Drake
     Dreier
     Duncan
     Ehlers
     Emerson
     English (PA)
     Everett
     Feeney
     Ferguson
     Fitzpatrick (PA)
     Flake
     Foley
     Forbes
     Fortenberry
     Fossella
     Foxx
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gohmert
     Goode
     Goodlatte
     Granger
     Graves
     Green (WI)
     Gutknecht
     Hall
     Harris
     Hart
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Hulshof
     Hunter
     Hyde
     Inglis (SC)
     Issa
     Istook
     Jenkins
     Jindal
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Kanjorski
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Kuhl (NY)
     LaHood
     Latham
     LaTourette
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas
     Lungren, Daniel E.
     Mack
     Manzullo
     Marchant
     Marshall
     Matheson
     McCaul (TX)
     McCollum (MN)
     McCotter
     McCrery
     McHenry
     McHugh
     McKeon
     McMorris
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Murtha
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Oberstar
     Osborne
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Poe
     Pombo
     Porter
     Price (GA)
     Pryce (OH)
     Putnam
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reichert
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Sabo
     Saxton
     Schmidt
     Schwarz (MI)
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (NJ)
     Smith (TX)
     Sodrel
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner
     Upton
     Visclosky
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Westmoreland
     Whitfield
     Wicker
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--2

     Brown-Waite, Ginny
     Hastings (WA)
       

                              {time}  1442

  Messrs. SAXTON, SOUDER, MURPHY, RYUN of Kansas, GILLMOR, OBERSTAR, 
VISCLOSKY and Mrs. NORTHUP changed their vote from ``yea'' to ``nay.''
  Messrs. OLVER, JEFFERSON, HOLDEN, and RAHALL changed their vote from 
``nay'' to ``yea.''
  So the amendment in the nature of a substitute was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Bass). The question is on the 
engrossment and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.


                Motion to Recommit Offered by Mr. Rangel

  Mr. RANGEL. Mr. Speaker, I offer a motion to recommit.
  The SPEAKER pro tempore. Is the gentleman opposed to the bill in its 
present form?
  Mr. RANGEL. I am, Mr. Speaker.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:

       Mr. Rangel moves to recommit the bill H.R. 4297 to the 
     Committee on Ways and Means with instructions to report the 
     same back to the House forthwith with the following 
     amendments:
       Strike section 203 (relating to capital gains and dividends 
     rates) and redesignate succeeding sections accordingly, and 
     strike the item in the table of contents relating to section 
     203 and redesignate the items relating to succeeding sections 
     accordingly.

[[Page 27809]]

       Insert after section 117 the following new section (and 
     amend the table of contents accordingly):

     SEC. 118. TEMPORARY RELIEF FROM THE ALTERNATIVE MINIMUM TAX.

       (a) In General.--Section 55 (relating to alternative 
     minimum tax imposed) is amended by adding at the end the 
     following new subsection:
       ``(f) Exemption for Individuals for Taxable Years Beginning 
     in 2006.--For any taxable year beginning in 2006, in the case 
     of an individual--
       ``(1) In general.--The tentative minimum tax of the 
     taxpayer shall be zero if the adjusted gross income of the 
     taxpayer (as determined for purposes of the regular tax) is 
     equal to or less than the threshold amount.
       ``(2) Phasein of liability above exemption level.--In the 
     case of a taxpayer whose adjusted gross income exceeds the 
     threshold amount but does not exceed $112,500 ($225,000 in 
     the case of a joint return), the tax imposed by subsection 
     (a) shall be the amount which bears the same ratio to such 
     tax (determined without regard to this subsection) as--
       ``(A) the excess of--
       ``(i) the adjusted gross income of the taxpayer (as 
     determined for purposes of the regular tax), over
       ``(ii) the threshold amount, bears to
       ``(B) $12,500 ($25,000 in the case of a joint return).
       ``(3) Threshold amount.--For purposes of this paragraph, 
     the term `threshold amount' means $100,000 ($200,000 in the 
     case of a joint return).
       ``(4) Estates and trusts.--This subsection shall not apply 
     to any estate or trust.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

  Mr. RANGEL (during the reading). Mr. Speaker, I ask unanimous consent 
that the motion to recommit be considered as read and printed in the 
Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from New 
York (Mr. Rangel) is recognized for 5 minutes and a Member in 
opposition to the motion to recommit will be recognized for 5 minutes.
  The Chair recognizes the gentleman from New York.
  Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
Massachusetts (Mr. Neal).
  Mr. NEAL of Massachusetts. Mr. Speaker, I want to thank the gentleman 
from New York (Mr. Rangel) for offering this motion to recommit today.
  The Rangel motion to recommit is about two things: truth in budgeting 
and truth in borrowing.

                              {time}  1445

  In almost 14 years now on the Ways and Means Committee, we have 
spoken of addressing the alternative minimum tax issue. There has been 
a lot of talk and not a lot of action. And you are going to hear in a 
couple of seconds, well, yesterday, we took up the Alternative Minimum 
Tax. What we did yesterday was a procedural maneuver that allowed 
everybody to cover themselves, but will have very little reality as it 
addresses alternative minimum tax.
  The gentleman from New York's motion to recommit goes right to the 
heart of the matter. You can, in a few minutes, cast a vote on really 
doing something about alternative minimum tax.
  Now, the next thing we are going to hear today is this: The Democrats 
were in charge for 40 years and did not address the alternative minimum 
tax issue. In 1994, a couple of 100,000 people paid alternative minimum 
tax in America. On January 1, that number kicks up, next year, to 19 
million people who will begin to pay alternative minimum tax. Mr. 
Rangel's proposal addresses this issue, and we pay for it, as I 
indicated at the outset of my remarks, honestly. The dividends and 
capital gains proposal does not even expire until the year 2008. And 
yet, we are doing that instead of doing alternative minimum tax.
  Now, this Congress had time, in the last 5 years, to repeal a series 
of taxes on the American people, all, by the way, for upper income 
groups. We certainly had plenty of time to repeal the estate tax. We 
had time to address dividends and capital gains. But we did not have 
time to address alternative minimum tax other than with Band-Aid 
approaches. Today, you have a chance to do something. Mr. Rangel's 
proposal lacks complexity. You can, in the next couple of minutes, 
choose between fixing AMT or extending dividends and capital gains cuts 
for the wealthiest among us. And by the way, when we hear the other 
side say that these cuts to middle income people for dividends and 
capital gains, the dividend proposal that they have ought to be 
understood in this light. More than 50 percent, I believe, 53 or 54 
percent of their dividend proposal, goes to people who made more than 
$1 million last year. Alternative minimum tax is a middle class issue 
across this country and we can do something about it.
  Embrace Mr. Rangel's proposal. Give him a positive vote on AMT. But 
most importantly, give those 19.3 million Americans next year some much 
needed relief in alternative minimum tax.
  Mr. RANGEL. Well, Mr. Speaker, you can take away our right to go to 
conference, our right to amend bills, but one thing you cannot take 
away is our right to vote. We have a game called 3 Card Molly in New 
York. You never know which one is under the shell. So they have an 
opportunity to say that they want to help the wealthiest Americans, but 
they like to give a whole lot of talk to those people who, through no 
fault of their own, except the ineptness and the inability of the 
Republicans to correct it, they got caught in the alternative minimum 
tax. Now, they will scream out that they took care of it on the 
suspension bill. Well, you do not have to be a parliamentarian to know 
when you send something to that other side and put it on the suspension 
calendar, you had better send a prayer over with it because any one guy 
can stand up and say I object.
  But when you cover it because you believe in it and put it in the 
reconciliation bill, it means that is what you really want to do. At 
the end of the day, when we vote, all we are saying is, we ask the 
conferees, whenever they might meet, that they are instructed by this 
House to take care of those who really deserve the tax privilege the 
most. Take care of those who were not really thrown into this thing 
because of increased income, but were thrown into the alternative 
minimum tax that was not supposed to capture them, but they got there 
because of inflation.
  In 3 Card Molly, you do not know what is going to happen. But we will 
know at the end of this vote something that John Lewis knows that they 
said in the civil rights movement, and that is, which side are you on? 
What a great opportunity. Take away everything you want. Take away our 
votes, our opportunity to express ourselves, give us rules that you 
like to give us. But, on this vote, at the end of the day, people might 
ask how did you treat the alternative minimum tax? Some people might 
say, well, it did come up in the House. It was not important enough to 
put in the reconciliation bill and it was not important enough to allow 
a lot of debate. We put it on the suspension calendar because it was 
not paid for and we did not think it would be controversial. And so, 
with all of the debate, what is going to happen when you get back home 
is did you protect those that were most vulnerable. Forget about the 
poor. Forget about the rich that you are giving the incentives to. Just 
ask, on this one thing, no matter what happens in conference, where was 
the alternative minimum tax protected? It is protected in our motion to 
recommit.
  Mr. THOMAS. Mr. Speaker, I rise in opposition to the motion to 
recommit.
  The SPEAKER pro tempore (Mr. Bass). The gentleman is recognized for 5 
minutes.
  Mr. THOMAS. Mr. Speaker, I do not need to mention yesterday or the 
414 who voted to fix this problem. I would tell my friend from New York 
that you only need 60 votes outside of a reconciliation to pass this. 
But I do want to mention 1985. The Tax Reform Act of 1985, under their 
watch, said this: ``Other regular tax itemized deductions such as those 
for State and local taxes paid and for certain investment expenses, are 
not allowed for minimum tax purposes.'' I assume they did that 
knowingly. They were the ones who did it.
  In 1993, they passed the largest tax increase on the American people 
and

[[Page 27810]]

had a chance to adjust it again then. I will say that we have made 
progress today. This is an appropriate motion to recommit. It does not 
kill the bill. The gentleman from Massachusetts said this is about 
upper income groups. In fact, there was an editorial recently that said 
it is between the rich and the very rich. But I do want to mark the 
landmark comment of the gentleman from Massachusetts who said this was 
about middle income people. And on page 2 of the motion to recommit, 
``For purposes of this paragraph, the term `threshold amount' means 
$100,000 and $200,000 in the case of a joint return.'' So $200,000 is 
now middle income. I believe that is correct. They are the ones who 
have always said those are the very rich. Now, the other thing you need 
to understand, it is this business of how many people are going to fall 
under the alternative minimum tax. Do you know why?
  The reason, in 1994 that there were so few people who fell under the 
alternative minimum tax is because the regular tax was so high. What 
has happened in 2001, 2002, 2003 and 2004 we have driven down the 
rates. And because we have lower taxes, there are more people who fall 
under the alternative minimum tax. Do we need to address it? Of course. 
But the vote today is far more fundamental than that. This vote, if you 
vote yes, gives money to rich people to spend on consumption. Surely, 
you know that pure consumption does not move the economy very much. 
What they want to do is deny people the opportunity to invest and to 
save to supply fuel to the engine of the economy so we can continue 
with the lowest unemployment rate and the highest productivity rate 
than we have seen in years. This vote is very simple. A yes vote, 
consumption, not much bang for the buck. A no vote, investment and 
savings and a lot of bang for the buck. Vote no on reconciliation, yes 
on the bill. If we have limited dollars to spend, spend them for the 
highest and best purpose.
  The SPEAKER pro tempore. Without objection, the previous question is 
ordered on the motion to recommit.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. RANGEL. Mr. Speaker, on that, I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 and clause 9 of rule 
XX, this 15-minute vote on the motion to recommit will be followed by 
5-minute votes, if ordered, on passage of the bill and on suspending 
the rules and passing H.R. 1400 debated yesterday.
  The vote was taken by electronic device, and there were--yeas 193, 
nays 235, not voting 5, as follows:

                             [Roll No. 620]

                               YEAS--193

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Barrow
     Becerra
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Butterfield
     Capps
     Capuano
     Cardin
     Cardoza
     Carnahan
     Carson
     Case
     Chandler
     Clay
     Cleaver
     Clyburn
     Conyers
     Cooper
     Costa
     Costello
     Crowley
     Cuellar
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Doggett
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Gonzalez
     Gordon
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Herseth
     Higgins
     Hinchey
     Hinojosa
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick (MI)
     Kind
     Kucinich
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren, Zoe
     Lowey
     Lynch
     Maloney
     Marshall
     Matsui
     McCarthy
     McCollum (MN)
     McDermott
     McGovern
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Melancon
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore (KS)
     Moore (WI)
     Moran (VA)
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Salazar
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Schakowsky
     Schiff
     Schwartz (PA)
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tanner
     Tauscher
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Wasserman Schultz
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                               NAYS--235

     Aderholt
     Akin
     Alexander
     Bachus
     Baker
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Bean
     Beauprez
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boren
     Boustany
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Burgess
     Burton (IN)
     Buyer
     Calvert
     Camp (MI)
     Campbell (CA)
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole (OK)
     Conaway
     Cramer
     Crenshaw
     Cubin
     Culberson
     Davis (KY)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     Dent
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Drake
     Dreier
     Duncan
     Ehlers
     Emerson
     English (PA)
     Everett
     Feeney
     Ferguson
     Fitzpatrick (PA)
     Flake
     Foley
     Forbes
     Fortenberry
     Fossella
     Foxx
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gohmert
     Goode
     Goodlatte
     Granger
     Graves
     Green (WI)
     Gutknecht
     Hall
     Harris
     Hart
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Hulshof
     Hunter
     Hyde
     Inglis (SC)
     Issa
     Istook
     Jenkins
     Jindal
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Kanjorski
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Kuhl (NY)
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas
     Lungren, Daniel E.
     Mack
     Manzullo
     Marchant
     Matheson
     McCaul (TX)
     McCotter
     McCrery
     McHenry
     McHugh
     McIntyre
     McKeon
     McMorris
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Murtha
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Poe
     Pombo
     Porter
     Price (GA)
     Pryce (OH)
     Putnam
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reichert
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schmidt
     Schwarz (MI)
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (TX)
     Sodrel
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner
     Upton
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Westmoreland
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--5

     Boozman
     Brown-Waite, Ginny
     Hastings (WA)
     Markey
     Smith (NJ)

                              {time}  1513

  So the motion to recommit was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Bass). The question is on the passage of 
the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. STARK. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--yeas 234, 
nays 197, not voting 3, as follows:

                             [Roll No. 621]

                               YEAS--234

     Aderholt
     Akin
     Alexander
     Bachus
     Baker
     Barrett (SC)
     Barrow
     Bartlett (MD)
     Barton (TX)
     Bass
     Bean
     Beauprez
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehner
     Bonilla
     Bonner
     Bono

[[Page 27811]]


     Boozman
     Boren
     Boustany
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Burgess
     Burton (IN)
     Buyer
     Calvert
     Camp (MI)
     Campbell (CA)
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole (OK)
     Conaway
     Cramer
     Crenshaw
     Cubin
     Cuellar
     Culberson
     Davis (KY)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     Dent
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Drake
     Dreier
     Duncan
     Ehlers
     Emerson
     English (PA)
     Everett
     Feeney
     Ferguson
     Fitzpatrick (PA)
     Flake
     Foley
     Forbes
     Fortenberry
     Fossella
     Foxx
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gohmert
     Goode
     Goodlatte
     Gordon
     Granger
     Graves
     Green (WI)
     Gutknecht
     Hall
     Harris
     Hart
     Hastert
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Hulshof
     Hunter
     Hyde
     Inglis (SC)
     Issa
     Istook
     Jenkins
     Jindal
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Kuhl (NY)
     LaHood
     Latham
     LaTourette
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas
     Lungren, Daniel E.
     Mack
     Manzullo
     Marchant
     Marshall
     McCaul (TX)
     McCotter
     McCrery
     McHenry
     McHugh
     McIntyre
     McKeon
     McMorris
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Poe
     Pombo
     Porter
     Price (GA)
     Pryce (OH)
     Putnam
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reichert
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schmidt
     Schwarz (MI)
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (NJ)
     Smith (TX)
     Sodrel
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Westmoreland
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                               NAYS--197

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Becerra
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boehlert
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Butterfield
     Capps
     Capuano
     Cardin
     Cardoza
     Carnahan
     Carson
     Case
     Chandler
     Clay
     Cleaver
     Clyburn
     Conyers
     Cooper
     Costa
     Costello
     Crowley
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Doggett
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Gonzalez
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Herseth
     Higgins
     Hinchey
     Hinojosa
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick (MI)
     Kind
     Kucinich
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Leach
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren, Zoe
     Lowey
     Lynch
     Maloney
     Markey
     Matheson
     Matsui
     McCarthy
     McCollum (MN)
     McDermott
     McGovern
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Melancon
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore (KS)
     Moore (WI)
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Salazar
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Schakowsky
     Schiff
     Schwartz (PA)
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Upton
     Van Hollen
     Velazquez
     Visclosky
     Wasserman Schultz
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--3

     Brown-Waite, Ginny
     Franks (AZ)
     Hastings (WA)

                              {time}  1523

  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Stated for:
  Mr. FRANKS of Arizona. Mr. Speaker, on rollcall No. 621 (final 
passage H.R. 4297), had I been present, I would have voted ``aye''.

                          ____________________