[Public Papers of the Presidents of the United States: George W. Bush (2003, Book I)]
[February 13, 2003]
[Pages 165-169]
[From the U.S. Government Publishing Office www.gpo.gov]
Remarks in a Discussion With Small-Business Owners in Jacksonville,
Florida
February 13, 2003
The President. Thank you all. Thanks for the warm welcome. I'm sure
glad I came. [Laughter] It's--I want to talk about some of the
challenges which face our country. A little later on, I'm going to go
speak to those souls who wear the uniform of the United States military
and thank them for their service to the country and tell them we've got
all the confidence in their capacity to help us keep the peace and
promote freedom.
It's clear we have challenges abroad, particularly the challenge to
keep the peace, to secure our homeland, to adjust our way of thinking to
make sure that we do everything we can to say with complete confidence
that we'll protect America. We'll protect this generation of Americans,
and we'll secure the homeland and make the world more peaceful, so that
future generations of Americans can grow up in peace.
That's a big challenge. And equally as big a challenge is to make
sure our economy is strong so that America is a hopeful place, that our
economy is strong enough to make sure the entrepreneurial spirit is
alive and well--and today we're going to talk to some entrepreneurs who
are living the American Dream--that our economy is strong enough to make
sure moms and dads have got the capacity to save and invest for their
children if that's what they choose to do, that our economy is strong
enough so that people who are looking for work can find a job.
And that's also a challenge we face. Today you'll hear me talk about
the plan that I have asked Congress to approve. I want the folks on the
stage up here to share with me and with you and others listening what
that plan means for their lives. In Washington, we spend a lot of time
talking about numbers. I like to remind people that behind each number
is somebody's life and why the plan that I've described to the Congress
is such an optimistic, hopeful plan for every American.
Before I begin, I want to thank
would be your Governor. So he had his 50th birthday on the 11th of
February. I called him and said, ``Happy birthday. Fifty is not quite as
old as it seemed to be, is it?'' [Laughter] But we're proud of him, and
we love him. Actually, I had coffee with Mother
and Dad this morning. And Mother said to make
sure I told Jeb she loved him still, so--[laughter]--she still loves
you. [Laughter]
I want to thank Hector Barreto for
being here as well. Hector is the head of the Small Business
Administration. One of the commitments of this administration is to
promote the entrepreneurial spirit throughout all our country. We want
anybody from any walk of life to realize if they have a dream and work
hard, they can realize their dreams. That's the greatness of America.
And I'm honored that Joe, Joe Dagher,
would invite us into his facility. He had a dream. He realized his
dream. He owns his own business. He can call it his own. And we're proud
of you, Joe, and thanks for letting us come.
So here's my attitude about economic growth and vitality. It's based
upon the principle that if people have more money in their pocket,
they're likely to demand a good or a service. And when they demand a
good or a service, somebody in the marketplace is going to produce a
good or a service. And when somebody meets that demand with production,
somebody is more likely to find work. And so when you couple that with
the understanding that the role of Government is not to create wealth
but an environment in which the entrepreneur is willing to take risks,
it yields this kind of plan.
[[Page 166]]
I believe we ought to cut the rates on everybody who pays taxes, and
I believe that we ought to reduce the income-tax rates. But you know
what's interesting is Congress has already agreed with that plan. In the
year 2001, in the face of a recession, we convinced both Republicans and
Democrats to support a rate reduction. It helped make our recession more
shallow. People did get more money in their pockets, and they did spend
that money.
What's interesting about the rate reduction plan that we've proposed
is that it is scheduled to phase in over time. It takes 5 years to get
the rates down. It takes years to get the child credit up to $1,000 per
child. It takes years to get the marriage penalty reduced to where we
want it to be reduced to.
Now, if the economy is still not as strong as it should be and if
Congress has already recognized that tax rate reduction helps economic
growth, my message to the United States Congress is: Speed up the
growth. If it's good enough 5 years from now, it is good enough today.
This economy needs immediate help, so I will ask Congress, when they
pass the bill, to make it retroactive to January 1st, which means
workers will get money in their pockets immediately, will mean small
businesses will get money to invest immediately. It will have an
immediate effect on today's economy, something I think we need,
something a lot of Americans understand we need, as we--coming out of
recession and recovering from a terrorist attack and as we're finally
getting--washing out of the system those who thought they could lie and
cheat when it came to their balance sheets. We're recovering from three
shocks to the system, and we need a little further wind at the back of
this economy.
Now, that means 92 million Americans will receive an average income-
tax relief package of $1,083. And that's good. And we'll hear from some
of our fellow citizens up here about how much relief this means for
them. And if they feel like it, they may share with us what they intend
to do with it. [Laughter] But one thing is for certain, I will assure
them, is at least I understand the money we're talking about up in
Washington is not the Government's money. See, it's their money and your
money. It's the people's money we're talking about.
Now, one of the things--reasons we came to Joe's business is, I wanted to make it very clear to the
American people that tax rate reductions have got an incredibly positive
effect on small businesses. Most small businesses are what they call a
sole proprietorship or a limited partnership or a Subchapter S
corporation. If you happen to be one of those three entities, you pay
tax at your business, on your business profits, at the individual
income-tax rates. And so therefore, by reducing income-tax rates, you're
really affecting small-business growth, and because over half the jobs
in America are created by small businesses, it makes sense to stimulate
that aspect of our economy.
Twenty-three million businesses will receive over $2,000 in income-
tax relief. Now, that means a lot when you start thinking about the
implications. I mean, you've got a one-man shop; $2,000 may mean the
capacity to buy a machine, leverage the money to buy a machine, which
means another job.
One of the things we understand in America, though, is investments
equals jobs, and therefore, one of the things we're going to try to do
is encourage more investment. And so I want to--right now, small
businesses are limited to the deduction of only $25,000 for a capital
expenditure. We want to raise it to $75,000, to encourage small
businesses to buy more equipment.
And so those are two aspects of this plan that makes sense. One is
how to encourage people to have--how do we encourage Congress to let
people have more money in their pocket, for the good of economic growth
and jobs, and what do we do about
[[Page 167]]
stimulating small-business activity and growth.
The third aspect of the plan is really to make the Tax Code more
fair. We tried to address that earlier, by the way. It is unfair to tax
a person's assets twice. That's why I've called upon Congress to get rid
of the death tax. See, really what we want is, we want our small-
business owners to work hard, to keep their vision, to build up their
assets, so they can leave it to whoever they want to leave it to,
without the Government standing in between. Congress passed it. They
need to make that aspect of the tax relief permanent, like they need to
make all aspects of tax relief permanent.
But today I want to talk to you about another unfair aspect of the
Tax Code, and that is the double taxation of dividends. It's fair to tax
a company's profits. What's not fair is when you take--the company takes
those profits and distributes them to one of the owners of the company,
the shareholder, and that person then has to pay tax on it. It means
Government is really interfering with capital. It means there's less
capital in the system for investment. And if investment means jobs, by
nature, getting rid of the double taxation of dividends will make it
easier for capital to accumulate, make it more likely people will find
work.
Secondly, the double taxation of dividends hurts our senior
citizens. It's particularly acute here in the State of Florida. There's
over 10 million seniors rely upon dividend income during their
retirement years. Why would we want to have something unfair in the Tax
Code which also penalizes those who we really need to help after their
retirement?
The double taxation of dividends will also put a premium on good
accounting. In other words, if you're distributing dividends, your whole
growth portfolio, your whole growth agenda will be based upon yield, as
opposed to pie-in-the-sky projections. Of course, people will say,
``Well, gosh, I'm going to invest in this company because I want a share
of their cashflow or share of their profits.'' And therefore, the
company ownership must base its projections on how they treat the
shareholder, as opposed to some pie-in-the-sky prognostication about
what may or may not occur. Growth will occur based upon the certainty of
the dividend being distributed. It will be a really important corporate
reform in America, in my judgment.
So this is what I've asked the Congress to approve. There's a lot of
talk about whether or not this is what they call stimulative, whether or
not it will affect the economy. Of course it will, because over the next
15 months we'll have pumped in $100 billion of additional money into the
private sector. That money will circulate. As that money circulates,
it's more likely somebody is going to be able to find work.
And so I'm here not only to share the details of the plan with you;
I'm here to ask you to contact your Senators and your Members of
Congress, remind them of whose money we're talking about, and remind
them of the philosophy I've just outlined to you as how best to create
jobs. The role of Government is to create an environment in which people
are willing to risk and take risks and to go to work and work hard, and
tax relief encourages that kind of environment.
So we're going to first start off and hear from Sue Butts. Sue is a entrepreneur. She owns her own business. She
owns Supreme Janitorial. She has owned it since 1968. Is that right?
Ms. Butts. Ninety-two.
The President. Ninety-two. Okay. [Laughter]
Ms. Butts. It's been in existence since '68.
The President. You bought it in '92.
Ms. Butts. Ninety-two.
The President. I will just tell you that she
will receive a $3,300 tax reduction if Congress--when Congress passes
this plan. I'm optimistic, by the way, that Congress
[[Page 168]]
is going to get the message. Why don't you tell us? Give us your
thoughts.
[At this point, the discussion proceeded.]
The President. Yes, I think it's important for our fellow citizens
to know that there are ways for Government to incent people to invest,
and this is a good way. I mean, here's a classic example of somebody who
has limited the amount she is going to invest
based upon tax policy. And the idea of raising the limit to $75,000, in
this case, it sounds like, could encourage more investment.
Now, what that means is somebody is going to be tasked with building
the machine she purchases or the equipment she
purchases, and that person will be working. And then, of course, the
people who she hires will have more equipment. And it may mean that she
needs an extra person to deal with the equipment she purchases.
Economies grow with the circulation of money. And this is a classic
example of how tax policy will encourage investment and the circulation
of money.
And so, thanks for sharing that with us. Congratulations on being a
successful entrepreneur, by the way.
Ms. Butts. Thank you, Mr. President.
The President. James is a installation
supervisor. He is a taxpayer. He is a man who has got a daughter that he
cares a lot about. And he's a guy who is going to have his taxes fall by
20 percent when this plan goes through. You see, there's a lot of
rhetoric in Washington about the--rich this, rich that, class warfare.
This is the kind of guy I'm worried about, and this is what this tax
plan--the tax plan speaks to people like James Thomas. Welcome.
[The discussion continued.]
The President. You've got more to say than that. Here's your chance.
[Laughter]
Mr. Thomas. I'm going to let it rest at
that.
The President. See, here's the thing about--you know, a dad puts
aside money for the daughter. The daughter invests it. It rolls over.
There is a compounding effect when it comes to investments. Money saved
and invested will keep rolling over and rolling over. So the $2,100, by
the time she goes to college 8 years from now, will be significantly
larger than that. And I appreciate you thinking about that. It's very
important for people to make the sacrifices for their children. It's
hard to raise kids. Tax relief will make it easier for people to make
sacrifices. It will help people meet the priorities they've set.
And I want to thank you, James, for that.
Zim is an entrepreneur. He--Zim, tell
us about your business. You've got some of your employees here, too.
[The discussion continued.]
The President. We're in Joe's house, Joe's
business. Joe, tell us what you do. Tell us when you started this
company, why you started the company. And thanks for letting us come by.
[The discussion continued.]
The President. This country must never forget what Joe just said. This is a welcoming society, based upon
allowing people to realize their dreams. I love to be in the presence of
somebody who is realizing their dreams.
We love freedom in America. We love the fact that people are free.
And I want to remind you what I said, Joe, and
I believe this as sure as I'm sitting here: Liberty is not America's
gift to the world; liberty is the Almighty God's gift to mankind. We
just have a chance here in America to protect liberty and freedom. And I
want to thank you for sharing that with us.
Another man who is living the American experience is Joey
Gonzalez, a hard-working man. You recommend
him, don't you? He works for Zim.
[Laughter] Joey, thanks for coming.
[The discussion continued.]
[[Page 169]]
The President. What you just said--you said, your most important job
is not working for Zim, necessarily; your
most important job is to be a loving dad. And I appreciate that example.
[The discussion continued.]
The President. Jodie also works with
Zim. And Jodie, we're proud you're here.
She's married. She's got a little girl who is 9.
[The discussion continued.]
The President. Well, I appreciate you sharing that with us. Thanks.
You're right, some of those pennies are going to the Government, and
they should. I mean, as a matter of fact, I'm now going over to the
base, and we're sending people into harm's way. They deserve the best
pay, the best equipment, the best possible training. And that requires--
there are legitimate uses of Government. But what we're talking about
today is really setting priorities, funding those priorities, but
remembering how to increase revenues. Revenues increase with economic
vitality and fiscal discipline in Washington, DC. Revenues increase by
empowering people and entrepreneurs and small businesses to grow and, at
the same time, saying to Congress, ``Let us focus on important
priorities.'' Remember whose money it is we're talking about. We're
talking about your money.
And I want to thank you all for coming today to give us--give me a
chance to talk about our vision for economic vitality and growth, for
letting people understand that behind every number there is a life that
will benefit, and when individuals benefit or small businesses benefit,
we all benefit. It's the cumulative effect of millions of acts--
decisionmakers in the marketplace, which affects job creation.
This administration is committed to job growth. I want to repeat to
you, so long as any American who wants to work can't find a job, we will
be committed to job growth.
And so I want to thank you for giving me a chance to come and share
this plan with you. This is a realistic plan. It is a hopeful plan. It
is a plan based upon sound principle. It's a plan which will work. It's
a plan that your Members of Congress--Ander
is all right. Don't worry about him; Crenshaw is with us. John
Mica is with us. I don't worry about those two.
But there are some who haven't gotten the message yet, and they need to
hear from you. And you can start right here in the State of Florida,
contacting your elected Representatives and letting them know how you
feel.
I want to thank you for coming. I want you to know that we're
citizens of the greatest country on the face of the Earth. God bless.
Note: The discussion began at 10:28 a.m. in a printing press room at
Dagher Printing. Discussion participants were: Gov. Jeb Bush of Florida;
Joseph Dagher, owner, Dagher Printing; Sue Butts, owner and president,
Supreme Janitorial Services; and Zimmerman Boulos, owner and president,
James Thomas, installer, Jose Gonzalez, installer, and Jodie Beere,
sales assistant, Office Environments and Services.