[Congressional Record (Bound Edition), Volume 154 (2008), Part 10]
[House]
[Pages 13719-13722]
[From the U.S. Government Publishing Office, www.gpo.gov]




   PROVIDING FOR CONSIDERATION OF H.R. 6275, ALTERNATIVE MINIMUM TAX 
                           RELIEF ACT OF 2008

  Mr. WELCH of Vermont. Mr. Speaker, by direction of the Committee on 
Rules, I call up House Resolution 1297 and ask for its immediate 
consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 1297

       Resolved, That upon the adoption of this resolution it 
     shall be in order to consider in the House the bill (H.R. 
     6275) to amend the Internal Revenue Code of 1986 to provide 
     individuals temporary relief from the alternative minimum 
     tax, and for other purposes. All points of order against 
     consideration of the bill are waived except those arising 
     under clause 9 or 10 of rule XXI. 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 bill, as amended, shall be considered as read. All points 
     of order against provisions of the bill, as amended, are 
     waived. 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 equally divided and 
     controlled by the chairman and ranking minority member of the 
     Committee on Ways and Means; and (2) one motion to recommit 
     with or without instructions.
       Sec. 2.  During consideration of H.R. 6275 pursuant to this 
     resolution, notwithstanding the operation of the previous 
     question, the Chair may postpone further consideration of the 
     bill to such time as may be designated by the Speaker.

  The SPEAKER pro tempore. The gentleman from Vermont is recognized for 
1 hour.
  Mr. WELCH of Vermont. Mr. Speaker, for the purpose of debate only, I 
yield the customary 30 minutes to my friend, the gentleman from Texas 
(Mr. Sessions). All time yielded during consideration of the rule is 
for debate only.


                             General Leave

  Mr. WELCH of Vermont. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and to insert extraneous materials into the Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Vermont?
  There was no objection.
  Mr. WELCH of Vermont. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, H. Res. 1297 provides for consideration of H.R. 6275, 
the Alternative Minimum Tax Relief Act of 2008, under a closed rule. 
The rule provides for 1 hour of debate, controlled by the Committee on 
Ways and Means.
  As Americans know, the alternative minimum tax was enacted in 1969 
with a very legitimate intent: to ensure fairness in our tax system by 
avoiding the situation where very wealthy individuals don't pay taxes 
and to close loopholes. It is in the same spirit of fairness that we 
consider legislation today that will keep the middle class out of being 
hit by the alternative minimum tax when it was never intended that they 
would be caught up in its web and who have been because of inflation 
and because of no adjustments in the Tax Code.
  The Alternative Minimum Tax Relief Act of 2008 will provide, one, 25 
million Americans with over $61 billion in tax relief. Two, it offers 
property tax relief to homeowners and expands the child and adoption 
credits to parents. Nearly 50,000 families in my own State of Vermont, 
Mr. Speaker, will see tax relief from this legislation.
  However, in order for the tax relief to be fair, we have to ensure 
that the cost of the tax relief is not simply passed on, the credit 
card debt, to our children, and we have already saddled the next 
generation with $9 trillion in debt, costing us $1 billion a day in 
interest payments, money that could be spent on other, much more 
productive things. Enacting an AMT patch today when we don't pay for it 
would simply shift that $62 billion burden from the middle class on to 
their children and their grandchildren. What we fail to pay today they 
will be forced to pay tomorrow with interest.
  Furthermore, we do pay for this tax relief by improving the Tax Code. 
With the bill's offsets, we are closing two very large tax loopholes, 
one that has benefited very wealthy hedge fund managers at the expense 
of middle class taxpayers, and let me talk about that first.
  The ``carried-interest'' loophole. It is a preferential rate of 
capital gains tax, a 15 percent rate that gets applied to income earned 
by many people who do financial work.

                              {time}  1130

  Right now, under current law, the income earned by many investment 
fund managers at a private equity firm, and hedge funds, are taxed at 
the lower capital gains tax rate. So you have this very unjustified 
situation where some of these folks who are making, in some cases, 
billions of dollars, pay a tax rate lower than the secretaries who work 
in their firms, and they do this when they don't actually put their 
capital at risk but manage the capital of others.
  A second loophole that is closed in this bill stops major oil 
companies from receiving what is called a special domestic production 
subsidy through the Tax Code. As we all know, record gas prices, the 
record cost of a barrel of oil is resulting in oil company profits that 
are unparalleled in the history of this country, in some cases, as high 
as $11 billion in a single 3-month period. So it's clear that those 
companies are doing very well and that they do not need continued 
taxpayer assistance.
  I commend Chairman Rangel and Chairman Neal and the Committee on Ways 
and Means for their excellent work on this legislation, and I encourage 
my colleagues to support the rule and the underlying legislation.
  I reserve the balance of my time.
  Mr. SESSIONS. Mr. Speaker, I want to thank my friend, the gentleman 
from Vermont, for not only yielding me this time to discuss the 
proposed rule for consideration of the alternative minimum tax, but I 
want to thank him for his friendship in the committee and the 
professional nature of the way he conducts himself.
  Mr. Speaker, today we are going to debate a tax increase on America. 
No surprise. The American public has gotten used to this. The tax-and-
spend Democrat Congress, the new Congress, the new way to run 
Washington, D.C. has resulted in not only economic failures here in 
this country the last 18 months but also higher gas prices, the 
inability that we have to control the flow in energy that comes into 
this country and has made us now more than ever to where we have to go 
get our energy overseas, send our money overseas, and not be able to be 
energy sufficient here in this country.

[[Page 13720]]

  But now I find out that the excuse for raising taxes on Americans 
today is that there's a loophole in the tax law--a loophole--and 
unintended consequences. The bottom line is that it's the tax law, it 
was therefore reasoned, and the opportunity for us to grow our economy 
and build jobs and have job creation and to protect the American 
consumer is why these were parts of the tax law. It is not unintended 
consequences, it is not a loophole, it is the law, the tax law of the 
United States that I am very proud of, and I am disappointed to see 
that the Congress today will be debating new tax increases on the 
American people.
  So I rise in strong opposition to this closed rule, yet another 
closed rule by this new majority that we have here, and to the 
underlying legislation, which takes the baffling approach, once again, 
of raising taxes on Americans and on the American economy during a 
downturn of our economy, rather than taking a way to prevent a tax 
increase on hardworking and unsuspecting middle class taxpayers, which 
sets the stage for even more job-killing tax increases in the very near 
future just to prevent the current low-tax policies that Republicans in 
Congress worked so hard to pass and to support on behalf of American 
taxpayers.
  I think it's interesting, Mr. Speaker, that when Republicans bring 
tax bills to the floor of the House of Representatives, we are able to 
tout how many jobs our tax bill will create, how many jobs the economy 
will create. I have never, ever heard of a Democrat tax-and-spend bill 
that then touts how many jobs will be created, because they don't. They 
kill jobs. They kill jobs in America every time we do what we are doing 
today with the new Democrat majority to raise taxes on America.
  Under the Democrats' flawed policy of pay-as-you-go logic used to 
defend this legislation, in just 2 short years--when a number of 
critically important tax policies like the $1,000 Republican tax credit 
and the Republican lower tax rate on income and capital gains and 
dividends are set to expire, that created job growth--the new Democrat 
majority pay-as-you-go rules will require more than $3.5 trillion in 
tax increases, and that is what they stand for today, increasing taxes 
on the American people, killing jobs all across the country, and yet 
they want to blame President Bush. Just incredible.
  It makes no sense to me why we are hamstringing our economy and 
saddling working families with higher taxes when revenues aren't the 
problem. Washington is already collecting more taxes as a percentage of 
GDP than the historical average over the last 40 years.
  We don't have a revenue problem. We have a spending problem. What 
Washington really has is a spending problem that this new Democrat 
majority can't fix and can't solve because they are all about taxing 
and spending. Federal spending is higher by nearly $530 billion more 
than the Congressional Budget Office's 2000 projection for the year 
2007. So going back to 2000, and they projected how much money we would 
need to spend, we are $530 billion more this year, thanks to a new 
Democrat majority, making increased spending the main reason why 99 
percent of our Nation's worsened budget picture over the last 7 years 
is occurring. We have got a downturn in the economy because we are 
raising taxes and spending to support a bloated government.
  Mr. Speaker, the American people have known for a long time that 
Republican Members of Congress support an economically responsible 
solution to solving the alternative minimum tax problem. Just contrast 
this year's Republican budget proposal, which prevented expansion of 
the AMT for the next 3 years and achieved full repeal in 2013, with the 
Democrat budget. If you compare them, the Democrat budget, which jammed 
a $70 billion tax increase into our economy to pay for simply a 
temporary 1-year fix, and did nothing about AMT for the next 5 years 
after that. A 1-year fix, raising taxes $70 billion, rather than fixing 
the problem.
  Mr. Speaker, taxpayers are already aware that last month, House 
Republicans unanimously supported a clean AMT patch without tax 
increases to prevent more than 25 million families--including 21 
million families who didn't owe AMT in 2007--from paying an additional 
$61.5 billion that's going to come due this next April, just like we 
did in December of last year and just like we will continue to do if 
Republicans once again become the majority party in Congress.
  What taxpayers may not realize is that House Democrats used to be for 
the same thing--at least that was until they won the majority. And with 
it came the opportunity to salivate, to get all this money, and to 
couple what used to be a bipartisan, commonsense tax prevention policy 
with massive, unnecessary tax hikes that burden this country, and for 
18 months we have seen the promise of higher taxes, and it's killing 
our economy. As recently as last December, the House passed a ``clean'' 
AMT patch, without crippling the economy with tax increases, by an 
overwhelming majority of 352-64.
  The only thing worse than House Democrats' tax-and-spend flip-flops 
on this issue is the fact that their comrades in the other body--
including Finance Chairman Max Baucus--have already recognized the 
reality that at the end of this day, the AMT patch will not be paid 
for, and that this cynical exercise meant to provide political cover is 
in fact dead-on-arrival the moment it passes this House. But let it be 
said: It's another opportunity for the new Democrat majority to show 
how much they want tax increases to ruin our economy.
  The cost of this political gamesmanship is really quite simple: the 
exposure of millions of middle class taxpayers to an average tax 
increase of $2,400, and the increased likelihood of a repeat of last 
year's mismanaged process in which the late enactment of the patch 
prevented the IRS from processing AMT-affected returns until about 4 
weeks into the filing season. It was a disaster this year as a result 
of the new majority.
  What is worse, Mr. Speaker, is how the Democrat Congress proposed to 
raise the additional $61 billion of additional taxes just to prevent 
this tax increase. That's right. We are going to have a tax increase on 
the tax increase on middle class families who were never intended to 
pay this.
  First, and rather unsurprisingly, this Democrat ``Drill-Nothing'' 
Congress helps repeal a tax deduction that helps American companies to 
produce energy for American consumers, but they are going to take that 
advantage away from consumers. It will only hurt energy exploration in 
this country, and now what we are going to see is that the American 
consumer will pay more at the pump.
  While this proposal is laughable at best for everyone tuning in on C-
SPAN across America today, it is about par for the course for the 
Democrat Party that also thinks that suing OPEC, not increasing the 
supply of American energy, will help bring down prices for consumers.
  Second, this bill increases taxes on entrepreneurs that create jobs 
and improve failing companies, and raises the long-term capital gains 
rate on them from 15 to 35 percent, or even higher. So the people that 
are the ``goose that are laying the golden egg'' are once again 
slaughtered by this new Democrat proposal.
  Once again, I know that most people around this country watching this 
debate understand that raising taxes on job creators reduces jobs and 
hurts our economy. But don't worry. You can blame President Bush for 
that, for the actions of this Congress.
  Unfortunately, this proposal is not a surprise, coming from a 
Democrat Congress that believes when real estate and credit markets are 
at their weakest, that is the optimal time to raise taxes and send our 
economy over the edge.
  Finally, the bill goes back on America's word by increasing taxes on 
transactions with treaty countries by mandating a new reporting 
requirement on private companies so that the IRS can know directly how 
much is being paid to merchants every year, including the Social 
Security or tax identification numbers associated with those 
transactions.

[[Page 13721]]

  Mr. Speaker, I have got to hand it to the new Democrat majority. 
Every single week, they find out a new way to assault the taxpayer, 
every single week they find a way to raise taxes, to increase spending, 
and more rules and regulations. They did it again this week. 
Congratulations to the new Democrat majority.
  Mr. Speaker, I strongly oppose this tax increase, and I will tell you 
that I will continue to stand up on the side of taxpayers and middle 
class Americans who say enough is enough.
  I reserve the balance of my time.
  Mr. WELCH of Vermont. Mr. Speaker, I am the last speaker on our side. 
I will reserve the balance of my time until the gentleman from Texas 
has an opportunity to close.
  Mr. SESSIONS. I thank the gentleman.
  Mr. Speaker, I will tell you--you've already heard me say it--this 
massive tax increase, once again, not only on the economy, but on 
Americans, could be done a different way. It could be solved. It could 
be solved by following through on promises that were made by both 
parties to do something about the AMT.
  We've got to do something. We continue to see middle class Americans 
caught in the crossfire. Today, we see it's not just a crossfire with 
inability to solve the problem, it's partially solved for 1 year by 
raising $61 billion worth of new tax increases on Americans that they 
will have to pay this next April.

                              {time}  1145

  Mr. Speaker, since taking control of Congress in 2007, this Democrat 
Congress has totally neglected its responsibility to do anything 
constructive to address the domestic supply issues that have created 
skyrocketing gas, diesel and energy costs that American families are 
facing today. As a matter of fact, gas rose 10 cents a gallon across 
America just in the last few days.
  So, today, I urge my colleagues once again to vote with me to defeat 
the previous question so this House can finally consider real solutions 
to the energy problems and the high costs that we are facing. If the 
previous question is defeated, I will move to amend the rule to allow 
for consideration of H.R. 5656, which would repeal the ban on acquiring 
advanced alternative fuels, introduced by my good friend Jeb Hensarling 
of Texas back in March, almost 3 full months ago.
  This legislation would reduce the price of gasoline by allowing the 
Federal Government to procure advanced alternative fuels derived from 
diverse sources like oil shale, tar sands and coal-to-liquid 
technology--in other words, marketplace answers--just by allowing the 
government to do that.
  Section 526 of the Energy Independence and Security Act of 2007, 
which this Democrat Congress passed, places artificial and unnecessary 
restraints on the Department of Defense in getting its fuel from 
friendly sources, like coal-to-liquid, oil shale and tar sands 
resources that are all abundant in the United States and Canada. 
Needless to say, it raises grave national and economic security 
concerns.
  Mr. Speaker, this new Democrat Congress wants us to spend hundreds of 
billions of dollars to go build another Dubai. They want consumers in 
this country to pay higher costs. By doing so, it is a national 
security issue. We must do something. Adding alternatives to the supply 
chain is what is important.
  Mr. Speaker, Canada currently is the largest U.S. oil supplier. It 
sent 1.8 million barrels per day of crude oil and 500,000 barrels per 
day of refined products to the United States in 2006. According to the 
Canadian Government, about half of the Canadian crude is derived from 
oil sands, with the oil sands production forecast to reach about 3 
million barrels a day in 2015. Section 526, passed by this Democrat 
House, choked this flow of fuel from one of our Nation's most reliable 
allies and economic partners, and it increased our military's reliance 
on fuels from unfriendly and unstable governments around the world.
  Mr. Speaker, I ask unanimous consent to have the text of that 
amendment and the extraneous material inserted into the Record prior to 
the vote on the previous question.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. SESSIONS. Mr. Speaker, I urge my colleagues to vote for our 
military, for energy independence for Americans, and to help American 
consumers in this time of need and to support our economy by increasing 
the amount of oil we import and produce from friendly and reliable 
sources like Canada and from our own American, buy-American proven 
resources, these advanced alternative fuels, by voting to defeat the 
previous question.
  Mr. Speaker, I yield back the balance of my time.
  Mr. WELCH of Vermont. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, my friend from Texas characterizes a bill that will 
provide tax relief to 25 million Americans as a tax increase, and it is 
just flat out wrong. There are 25 million Americans. These are folks 
who earn between $40,000, $50,000, $60,000 a year, who, if we do not 
pass this legislation, will find themselves essentially being the 
target of legislation that was intended in 1969 to have millionaires 
pay their fair share.
  We are talking about soldiers returning from Iraq and Afghanistan who 
get a job as a police officer or as a carpenter. We are talking about 
some our school teachers all across the country. We are talking about 
sanitation workers who are struggling hard on $40,000 or $50,000 a 
year, oftentimes with two people in that family who are working, 
raising three or four kids. We are saying in this legislation that we 
are going to protect you, because we know you need to have that money 
to pay your bills.
  We also have to level with the American people. This is going to be 
$61 billion in tax relief for those incredibly hard-working Americans 
who are getting clobbered by these $4-plus gas prices. They can't fill 
up their tank. They have got cars or SUVs or trucks that they have to 
drive, and they don't have the money to get something that is a little 
bit more fuel efficient. A lot of them have long commutes. This 
legislation is going to give them the opportunity to keep a little bit 
more money in their pocket so they can make it from one end of the week 
to the other and can pay their bills.
  Now, the question is for this Congress, do we pay for it, or do we 
put it on the credit card? As to what my friend from Texas is 
characterizing as a tax increase, let me go through it, because I think 
Americans have a commitment to fairness, and I think Americans know a 
very commonsense proposition, and that is we have all got to bear the 
burden. We all have to pay our share of the load.
  There are two very glaring situations in the Tax Code, and attention 
should be paid to them, and it is overdue. One is this hedge fund 
exemption, where folks who make an awful lot of money pay at a capital 
gains rate. What is unfair about it? If you are a financial advisor, if 
you or I ask someone to help us figure how to invest our money, we pay 
them a fee, and of whatever earnings they get, they pay a regular tax 
rate just like any other American. Whatever that rate is--15, 20, 35 
percent--that is what they pay.
  If you are a hedge fund executive and you make billions, because of 
this provision in the Tax Code, which I am calling a loophole, they get 
to pay at a 15 percent rate. That is costing the treasury billions of 
dollars, and it is also a glaring unfairness, because you literally 
have a situation where the hedge fund manager who is doing the same 
work as another financial advisor down the street pays one rate, 15 
percent, while the other person doing the same work, working just as 
hard but who is perhaps making less money, pays 35 percent.
  You also have this bizarre situation where the person making this 
immense amount of money pays a much lower tax rate than the secretary, 
than the back office help in that very same firm. I think most 
Americans see a

[[Page 13722]]

basic fairness, and let's have the income tax rate apply to earned 
income. That is what this provision does.
  The second question is on the oil company exemption, and I am using 
the word ``loophole.'' What is a ``loophole''? I think, commonly, you 
know it when you see it. What a ``loophole'' is in this case is giving 
taxpayer benefit to very successful companies that do very well in what 
they do--explore for oil, sell it. We are taking money from the 
taxpayers of America to give it to major American and foreign oil 
companies. These are mature industries that are making hundreds of 
billions of dollars, and they don't need taxpayer help.
  So this legislation provides 25 million Americans with tax relief, 
and it is the folks who need it. It asks other Americans, the hedge 
fund executives, to pay at the income tax rate, and it has oil 
companies foregoing what has been an incredibly good deal--tax credits 
that they get at the expense of the American taxpayer.
  I urge a ``yes'' vote on the previous question and on the rule.
  The material previously referred to by Mr. Sessions is as follows:

       Amendment to H. Res. 1297 Offered by Mr. Sessions of Texas

       At the end of the resolution, add the following:
       Sec. 3. Immediately upon the adoption of this resolution 
     the House shall, without intervention of any point of order, 
     consider in the House the bill (H.R. 5656) to repeal a 
     requirement with respect to the procurement and acquisition 
     of alternative fuels. All points of order against the bill 
     are waived. The bill shall be considered as read. The 
     previous question shall be considered as ordered on the bill 
     and any amendment thereto to final passage without 
     intervening motion except: (1) one hour of debate on the bill 
     equally divided and controlled by the chairman and ranking 
     member of the Committee on House Oversight and Government 
     Reform; and (2) an amendment in the nature of a substitute if 
     offered by Representative Waxman, which shall be considered 
     as read and shall be separately debatable for 40 minutes 
     equally divided and controlled by the proponent and an 
     opponent; and (3) one motion to recommit with or without 
     instructions.
                                  ____

        (The information contained herein was provided by 
     Democratic Minority on multiple occasions throughout the 
     109th Congress)

        The Vote on the Previous Question: What It Really Means

       This vote, the vote on whether to order the previous 
     question on a special rule, is not merely a procedural vote. 
     A vote against ordering the previous question is a vote 
     against the Democratic majority agenda and a vote to allow 
     the opposition, at least for the moment, to offer an 
     alternative plan. It is a vote about what the House should be 
     debating.
       Mr. Clarence Cannon's Precedents of the House of 
     Representatives, (VI, 308-311) describes the vote on the 
     previous question on the rule as ``a motion to direct or 
     control the consideration of the subject before the House 
     being made by the Member in charge.'' To defeat the previous 
     question is to give the opposition a chance to decide the 
     subject before the House. Cannon cites the Speaker's ruling 
     of January 13, 1920, to the effect that ``the refusal of the 
     House to sustain the demand for the previous question passes 
     the control of the resolution to the opposition'' in order to 
     offer an amendment. On March 15, 1909, a member of the 
     majority party offered a rule resolution. The House defeated 
     the previous question and a member of the opposition rose to 
     a parliamentary inquiry, asking who was entitled to 
     recognition. Speaker Joseph G. Cannon (R-Illinois) said: 
     ``The previous question having been refused, the gentleman 
     from New York, Mr. Fitzgerald, who had asked the gentleman to 
     yield to him for an amendment, is entitled to the first 
     recognition.''
       Because the vote today may look bad for the Democratic 
     majority they will say ``the vote on the previous question is 
     simply a vote on whether to proceed to an immediate vote on 
     adopting the resolution . . . [and] has no substantive 
     legislative or policy implications whatsoever.'' But that is 
     not what they have always said. Listen to the definition of 
     the previous question used in the Floor Procedures Manual 
     published by the Rules Committee in the 109th Congress, (page 
     56). Here's how the Rules Committee described the rule using 
     information form Congressional Quarterly's ``American 
     Congressional Dictionary'': ``If the previous question is 
     defeated, control of debate shifts to the leading opposition 
     member (usually the minority Floor Manager) who then manages 
     an hour of debate and may offer a germane amendment to the 
     pending business.''
       Deschler's Procedure in the U.S. House of Representatives, 
     the subchapter titled ``Amending Special Rules'' states: ``a 
     refusal to order the previous question on such a rule [a 
     special rule reported from the Committee on Rules] opens the 
     resolution to amendment and further debate.'' (Chapter 21, 
     section 21.2) Section 21.3 continues: Upon rejection of the 
     motion for the previous question on a resolution reported 
     from the Committee on Rules, control shifts to the Member 
     leading the opposition to the previous question, who may 
     offer a proper amendment or motion and who controls the time 
     for debate thereon.''
       Clearly, the vote on the previous question on a rule does 
     have substantive policy implications. It is one of the only 
     available tools for those who oppose the Democratic 
     majority's agenda and allows those with alternative views the 
     opportunity to offer an alternative plan.

  Mr. WELCH of Vermont. Mr. Speaker, I yield back the balance of my 
time, and I move the previous question on the resolution.
  The SPEAKER pro tempore. The question is on ordering the previous 
question.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. SESSIONS. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this question will be postponed.

                          ____________________