[Congressional Record (Bound Edition), Volume 157 (2011), Part 12]
[House]
[Page 17700]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              THE FAIR TAX

  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Georgia (Mr. Woodall) for 5 minutes.
  Mr. WOODALL. Mr. Speaker, it's always nice to come to the House floor 
after someone has just said ``God bless America.'' It makes me feel 
good, sir, and I want to associate myself with those remarks.
  Candidly, I'm a little worried about what happens here in this 
country. Mr. Speaker, I know you have the pleasures I do of seeing all 
the folks from across America who come here to see the procedures that 
go on here on the House floor, and I know folks often wonder and 
probably ask you, Mr. Speaker, Where is everybody? What's going on? 
Well, of course, with the exception of those of us on the House floor, 
everybody is in their office watching on the closed-circuit TV so you 
can multitask and do it all. I came down here to bring words to those 
folks who are watching on TV.
  But really, Mr. Speaker, it's about the youngest folks we have in the 
country. It's about the economy that you and I are going to leave to 
the next generation of Americans. And we can do things here in this 
House today that guarantee a better economy in the years to come. Right 
now--right now--I don't tweet. I don't use Twitter. I'm not that 
interesting that I have something to say to folks every moment of the 
day, but if I were tweeting, I would say that right now in the Joint 
Economic Committee there's a hearing on fundamental tax reform, asking 
the question can tax reform boost investment and job creation? And the 
answer is absolutely, it can.
  Here, in this country, what we tax, we destroy. Think about that. The 
power to tax is the power to destroy.
  Mr. Speaker, when I go to speak to high school students, I say, okay, 
I've got a $20-an-hour job working in my congressional office. Who 
wants to come work for me? Everybody raises their hand. I said, I'm 
going to need to tax you about $19 an hour on that, so you're only 
going to get to take home 1. Who wants to come work for me? And all the 
hands go down. The hands go down because they don't want to work for $1 
an hour. They want to keep what they earn.
  The power to tax is the power to destroy. Today, in this country, we 
tax income. We are the only Nation in the OECD that does not have a 
consumption tax. We tax income. And when you tax income, which is 
productivity, you destroy productivity.
  I have a proposal that is the most widely cosponsored fundamental tax 
reform proposal in either the House or the Senate, and it's called the 
Fair Tax. It's H.R. 25 here on the House side. And I have the great 
pleasure of working with so many of my colleagues to push that bill 
forward. It abolishes the income tax in favor of a consumption tax.
  Now, when we're in a tough economy like this, folks say, But Rob, I'm 
cutting back on my consumption. Would we still be able to bring in the 
revenue that we need with a consumption tax? Well, I bring charts. What 
you see here in the blue line is personal consumption, and what you see 
in the red line is personal income. The red line represents what we tax 
in the income tax, and the blue line represents what we would tax in 
the consumption tax. And what you see are two things. Number one, they 
are roughly the same--roughly the same.
  Yes, we can tax consumption and bring in the same revenue we get 
today by taxing income, but when they're different, it's because the 
volatility of the income is greater than the volatility of consumption. 
When you tax income, all you get to tax is income. When you tax 
consumption, you end up taxing income, plus savings people are 
spending, plus borrowing that they're doing. It's a much more stable 
tax.
  Why is that important? Mr. Speaker, what you know in your time here 
in the House, as I know from my time here in the House, is that if you 
give this House more money, we're going to spend it. I don't want to 
spend it. I wish we wouldn't. And I'm going to vote ``no,'' but I'm 
going to lose.
  If you tax something that's volatile, in the boom years, the money 
comes pouring in. Do you think we save it for a rainy day? We don't. We 
spend it. And then when the down year comes, folks are accustomed to a 
high spending level. What do we do? We borrow it from our children and 
our grandchildren and spend it anew.
  Having a stable income stream that doesn't have the highs and doesn't 
have the lows will lead to a better Federal budgeting process. And 
taxing consumption, which is what we take out of the economy, instead 
of taxing the income, which is what we put into the economy, will grow 
it;
  Mr. Speaker, a few years ago, the Joint Tax Committee here did a 
study and said, How would we evaluate consumption tax? We don't even 
have a model for it. How would we do it if we did away with the income 
tax and brought in the consumption tax? They brought in economic groups 
from the left and the right. Of course they disagreed about absolutely 
everything, those groups from the left to the right, all the way across 
the spectrum, except for one thing, Mr. Speaker. Every single economic 
model and group agreed that if we moved to a consumption tax from 
today's income tax, America's economy would grow faster.
  Mr. Speaker, every dollar we can grow, every job we can create, they 
matter today. And I encourage folks to take a look at H.R. 25, the Fair 
Tax, as a mechanism for making that happen.

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