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“REPUBLICAN 90-10 PLAN” mentioning the U.S. Dept of State was published in the House of Representatives section on pages H9263-H9270 on Oct. 1, 1998.
The publication is reproduced in full below:
REPUBLICAN 90-10 PLAN
The SPEAKER pro tempore. Under the Speaker's announced policy of January 7, 1997, the gentleman from Arizona (Mr. Hayworth) is recognized for 60 minutes as the designee of the majority leader.
Mr. HAYWORTH. Mr. Speaker, and for those who join us from coast to coast and beyond via C-SPAN, we make many historic decisions in this, the people's House, and one made last week is one of the most profound, with far-reaching consequences for the better, for our Nation and our people. Because, Mr. Speaker, last Saturday in this Chamber the majority passed a plan that said, quite simply, it is important that this Congress sets aside $1,400,000,000,000 to save Social Security.
Now, it has been interesting to hear some of the debate that was bandied back and forth; to hear some of the commentators and pundits, but this historical fact is beyond dispute: Never before, Mr. Speaker, in the history of this assembly, did anyone step forward to set aside funds to save Social Security.
Oh, there were efforts to raise payroll taxes, and always it seemed the temptation of raising taxes was something to which previous majorities succumbed. But what this common sense conservative majority did in this Chamber last Saturday provides a common sense plan not only for Social Security but also for tax relief to the American people. Those of us in our common sense conservative majority call it the 90-10 plan, setting aside 90 percent of the projected surplus, again,
$1,400,000,000,000 for Social Security, and using a very modest amount, comparatively, for tax relief for the American people.
Mr. Speaker, I am joined tonight for this special order by one of my colleagues from the Committee on Ways and Means, my classmate who joined me in the new majority in that historic vote in November of 1994 as a newcomer to Congress in the 104th Congress, my seat mate now on the Committee on Ways and Means, one who has worked tirelessly to provide meaningful features of this tax relief plan. At this time I would yield to my good friend, the gentleman from Illinois (Mr. Weller), to talk about what in essence is the centerpiece of this tax relief plan, this very prudent, this long-term profitable plan for the American Nation, the centerpiece of the feature being relief from the marriage penalty. I yield to my friend.
Mr. WELLER. Mr. Speaker, I thank my colleague for yielding me some time to talk about what I consider to be a big victory, not only for the people of Arizona and Illinois but people throughout this country. It is because of the Republican majority in the last 3\1/2\ years that for the first time in 28 years we have a balanced budget. Not only do we have a balanced budget but, beginning today, October 1st, we have a surplus, more tax revenue coming into the Treasury than we are spending.
We have held the President as well as our own leadership's feet to the fires. That freshman class of 1994 said that we were going to come to Washington to change how Washington works. We have succeeded in balancing the budget, and I am proud of that. And it is kind of something new here in Washington, that we actually have more tax revenue coming in than we are spending. We are more than living within our means.
In fact, it is projected today by the Congressional Budget Office that we expect to see over the next 10 years, thanks to a fiscally conservative Congress, a $1.6 trillion budget surplus.
$1,600,000,000,000 in extra surplus tax dollars that are now in the Treasury over the next 10 years because we have held the line on spending. That is a big victory.
I want to point out that the balanced budget that we pushed through Congress last year, and convinced the President to sign, contained no tax increases on the American people. No income tax increases. In fact, we gave, for the first time in 16 years, middle class tax relief to the folks back home.
The gentleman was pointing out, of course, what is a big victory for a lot of people, for all of us that are working Americans, those of us who want to see the contract with working families, the retirement contract that is Social Security, honored. And, of course, we recognize that for people like my mom and dad, and when I think of Social Security we always think about those closest to us, our family, and how government in its ways and actions affect people we love and care about.
When I think of Social Security, I think of my own mom and dad, and I think of my Aunt Mary, and my Aunt Eileen, my Uncle Jack, my Uncle Bob, and members of my family that are seniors, where Social Security is an important part of their lives and their friends and their neighbors. And for them Social Security is in good shape. But for the next generation, my brothers and my sister's generation, for the baby boomers and for those that follow, Social Security is in question.
Because of our concern in this Congress to save Social Security, to ensure that we honor the contract of Social Security for the next generation and future generations, I am proud that we set aside
$1,400,000,000,000 to save Social Security.
I mentioned earlier my sister Pat, when I think of the marriage tax penalty. And I have often asked this question in debate here in the House over the past year, and my colleague from Arizona and others have joined us in this fight to eliminate what we consider to be the most unfair provision in the Tax Code, and it is a simple question: Is it right, is it fair that under our current Tax Code a married working couple with two incomes pays higher taxes than an identical working couple, with an identical income, that lives together outside of marriage? They, instead, pay less. It is just not right that under our Tax Code a married working couple pay more in taxes just because they are married. And I am really proud that the centerpiece of the tax provisions in the 90-10 plan will eliminate the marriage tax penalty for a majority of those who suffer it.
It is really a simple solution in the way that we go about providing tax relief to married couples, eliminating the marriage tax penalty for a majority of married couples that suffer it today. It is estimated that almost 28 million married working couples will benefit from the marriage tax relief provisions in this package.
And it is pretty simple. The standard deduction is a standard deduction we take if we do not itemize. And right now the standard deduction for joint filers, in this case usually married couples always, of course, is not equal to twice what the single filer has. In fact, it is only $6,900. Now, we increase the standard deduction for joint filers to $8,300, exactly twice what a single taxpayer is able to claim. And in doing so, for 28 million married working couples they will see an extra $240 in higher take-home pay, less money they are going to send to Uncle Sam.
We eliminate the marriage tax penalty for a majority of those who suffer it with our simple solution by doubling the standard deduction for joint filers. I think of Joliet, Illinois, in the south suburbs of Chicago. $240, that is a car payment. That is two months worth of day care at a local day care center. That is groceries. That is a little extra money to help pay for school clothes for the kids. And that is real relief.
I am really proud that we made this the centerpiece of the tax provisions in this 90-10 plan. Think about it. We are saving Social Security with $1.4 trillion that was set aside. We are eliminating the marriage penalty for those who, of course, are suffering it, for the majority of those who suffer it. Twenty-eight million married couples will benefit. And there is one additional benefit, too. As my friend from Arizona pointed out earlier when we talked about this plan, what is really exciting is our goal not only to lower taxes for working Americans and working families but also to simplify the Tax Code.
One of the big benefits of doubling the standard deduction to twice that of a single filer is 6 million taxpayers will no longer have to itemize, will no longer have to use a schedule A. And in doing so, filing taxes is going to be simpler for 6 million filers. They will only need to file the 1040 EZ. That is a big victory. I am so proud that we not only save Social Security and eliminate the marriage tax penalty for so many, but this 90-10 plan received bipartisan support when it passed the House last Saturday, and I am proud to be a part of this.
Mr. HAYWORTH. I thank my colleague for the work he has done in focusing attention on the marriage penalty, one of the many features of our Tax Code that was just plain wrong. It did not make sense to penalize married couples, when other couples living out of wedlock were enjoying economic benefits as opposed to those who played by the rules, worked hard and observed the institution of marriage.
There are so many different things that we are offering in this relatively modest package of tax relief. Again, remember, we are setting aside $1,400,000,000,000 of the surplus to stay, to strengthen, to save Social Security, and only 10 percent of the projected surplus would go to tax relief. But in that package I think especially about my district and the seniors who live in my district and the many seniors who find that they have to work. As much as they would like to have the leisure time, their situation demands that they still need to earn an income.
And what we have done, as part of this bill of tax relief, is to increase the amount of money seniors can earn without losing Social Security benefits by increasing that earnings limit; to raise that, understanding that some people, A, enjoy working, they still want to be active, they appreciate the dignity of work, and they do not want to be penalized for working but; B, some folks, quite frankly, need it to make ends work. Why then would we seek to punish those seniors? And that is another area that is so vitally important.
My friend has another point to make, and I would gladly yield to him.
Mr. WELLER. I thank the gentleman. And I often think about seniors who we see working at restaurants, or they operate a small business on the side. We even see them at the arts and crafts shows. And it is just wrong that if we look at the Tax Code that senior citizens who have worked hard all their lives, and seniors are active longer, they are living longer, they want to be active longer, many want to work longer, of course they would like to have a little extra income, and it is really wrong that they are punished for working longer.
So that is why I think that raising the Social Security earnings limit to the level that we raise it makes a big difference for these seniors; that if we do not raise the earnings limit, they will have more of their Social Security benefits taxed away, and that is wrong. So by raising the Social Security earnings limit, we help a lot of seniors in Arizona, in Florida and Illinois.
And one thing I wanted to point out is that, of course, as we work on strengthening Social Security for the long term, a key part of that, I believe, is encouraging people to save for their retirement. And another provision in this tax package that I think is so important, as we help those who work hard and save a little for their retirement, for their future, is the Savers Act portion here.
And of course our colleague, the gentleman from Missouri (Mr. Kenny Hulshof) really had the lead on this. A key member, a new member of the Committee on Ways and Means. His savers exclusion, which was included as part of this package, was a real winner if we want to encourage people to save for their retirement.
Because under this 90-10 plan we allow someone to have their first
$100 in savings interest or dividend income exempt from taxes for a single taxpayer. And we also recognize, so there is no marriage tax penalty, that we allow the first $200 in savings interest for a married couple. What that essentially means is a married couple can have
$10,000 in a bank account or a savings account, and the interest on that is tax free.
Not only do we reward saving for retirement, I would like to point out that is one more way that we simplify the Tax Code. It is estimated that 68 million taxpayers will benefit from exempting the first $100 for singles, $200 for couples from income taxes.
Not only will 68 million taxpayers benefit, but also it helps simplify the Tax Code. There is that Schedule B. That is where we report our dividend interest and dividend income in the taxes. And we helped simplify it because this will allow 10 million taxpayers to simplify their tax filing to the point where they only have to file one form. They will no longer need to itemize.
Think about that. Ten million taxpayers and seven million people will no longer need to file a Schedule B. So 17 million taxpayers will see their tax filing experience, which no one likes, simplified. That is a big victory. I thought it was important to point that out.
Mr. HAYWORTH. One of the things we have learned since coming to the Congress of the United States is just how important it is to listen to our constituents. When I was back home over the district work period, holding in excess of 30 town hall meetings, what I heard time and again from the folks who live in the Sixth Congressional District of Arizona is that they wanted to see now, as we move to the policies of surplus, that we set aside the surplus for three things: that we save Social Security; that we help pay down the debt, the $5.5 trillion debt, which hangs over the heads of our children; and that we understand again a hard and basic truth that has been difficult for folks inside the District of Columbia to understand, and it is a simple statement, very commonsensical, but sometimes the logic escapes people here, and it is this notion: that the funds that come from the pockets of American citizens belong to those citizens, not to the government.
To the extent possible, working people should hold on to more of their hard earned money and send less of it here to Uncle Sam, and that is the logic and the notion behind tax relief.
Mr. WELLER. The gentleman has brought up a really good point. As we have shared many times in our conversations, we have talked about our districts and the good people we have the privilege of representing, I represent a really diverse district, the south side of Chicago, the south suburbs in Cook and Will counties; bedroom communities like Morris, where I live, and a lot of corn fields and farm towns.
Whether I am at the grain elevator, the union hall or the VFW or a local Business and Professional Women's meeting, I find there is a lot of common concerns, and saving Social Security, eliminating the marriage tax penalty, helping farmers, helping small businesspeople, helping families who want to set aside a little money to help put the kids through college and, of course, this 90-10 plan, accomplishes that.
I had a senior citizen come up to me this last couple of days while I was back in Illinois and he said, Representative Weller, what I am really excited about with that Social Security savings plan and the marriage tax elimination and the other tax provisions in the 90-10 plan, is I remember when President Clinton gave his speech back in January.
Remember that State of the Union speech? The President said, let us save Social Security first and let us set aside the surplus for Social Security? I stood up and applauded and we all did in a bipartisan effort because we wanted to save Social Security.
That senior pointed out, he said, Representative, you folks did twice what the President asked for because when the President said set aside the surplus, there was $600 billion in projected extra tax revenue. Well, nine months later, there is a projected $1.6 trillion extra tax dollars now in the treasury and we set aside $1.4 trillion. That is more than two times what the President asked for. That is going to help us save Social Security not only for today's seniors but particularly for the baby-boomers and the future generations that are looking to Social Security as part of their retirement income.
I thought it was real important to share that experience and that conversation back home.
Mr. HAYWORTH. Mr. Speaker, I would point out one other fact that I hope that American citizens will keep in mind. When the President of the United States graced us with his presence and stood at the podium behind us here, he not only said that every penny should go to save Social Security, we should save Social Security first, but sadly his actions failed to reconcile with that promise. For, even as he made that promise from the podium behind us here, he subsequently spent almost $3 billion in Bosnia, which points up the other basic truth of the pitfall of the great debate that continues in this chamber and across America.
As my constituents tell me, the sad fact is, if we leave money in Washington, Washington spends the money. It belongs to the American people and that is money that should return to their pockets.
Mr. Speaker, we are joined here tonight by another colleague. I look and see another classmate from the 104th Congress, our good friend, the gentleman from Pennsylvania (Mr. Fox), who joins us here on the floor tonight.
Mr. FOX of Pennsylvania. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from Pennsylvania.
Mr. FOX of Pennsylvania. Mr. Speaker, I thank the gentleman from Arizona (Mr. Hayworth) for yielding.
Mr. Speaker, I am very proud of the efforts of the gentleman from Arizona (Mr. Hayworth) on the Committee on Ways and Means to lead the fight to have the tax relief and to help our seniors in saving Social Security. I know we are joined by the gentleman from Missouri (Mr. Hulshof) and also the gentleman from South Dakota (Mr. Thune).
I think it is important that we be able to show this collective bipartisan effort to really help our seniors make sure that Social Security is secure.
I would say to my colleagues it is interesting to note that 60-plus, the fastest growing seniors advocacy group in the United States, has endorsed this 90-10 plan, which does exactly what the American people want. They want a Social Security system that is going to be secure, and with $1.4 trillion being placed in the Social Security trust fund, that is more than twice the amount of money that has been owed from prior Congresses.
The fact that we are able to make sure the marriage penalty elimination is going to help seniors and others, and the fact that the saver's tax exemption is going to help seniors and others, and the fact that reducing inheritance taxes is going to help seniors and others, shows that we have made our first initiative here to make sure that seniors have a Social Security system that is secure; then a modest tax decrease, which I think the American people deserve. It is their money after all.
This is really a great accomplishment. I am hoping that the Senate will move forward, agree with us and then eventually have the President sign the bill as well.
Mr. HAYWORTH. Mr. Speaker, we are joined also tonight by two colleagues from the freshman class of the 105th Congress, two gentlemen who hailed from States where agriculture is of vital importance, and I look to my left, very rarely philosophically do I find this gentleman on my left, but my friend, the gentleman from South Dakota (Mr. Thune) joins us.
Mr. THUNE. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from South Dakota.
Mr. THUNE. Mr. Speaker, I want to thank my friend from the desert, the gentleman from Arizona (Mr. Hayworth), for yielding and thank him for the great work that he has done on the Committee on Ways and Means and our other colleagues on the floor this evening; the gentleman from Missouri (Mr. Hulshof), who authored the small saver exclusion in this bill, which is so critical, too, for a lot of people in this country who are trying to save some money and is going to simplify the Tax Code.
There are a lot of people who will not have to fill out schedule B in the future and that is a significant thing, and the gentleman from Illinois (Mr. Weller), our distinguished colleague, who is responsible primarily for bringing forward and making the crown jewel of this tax cut package the marriage tax penalty relief.
What I would like to do just briefly is touch on a couple of other aspects of this bill which is very important in my part of the country, and that is in the world of agriculture. I might begin by saying that the last time we had a balanced budget in this country I was 8 years old. We have been living in this culture of debt now for the past 30 years, all of my adult life basically. It is just an amazing, I think remarkable, accomplishment.
The American people should make no mistake about it. The reason we are where we are is thanks to their hard work but also to the Republican majority in this Congress who when they were elected, when they came in in 1994 and we joined them in the 1996 and 1997 session of Congress, set upon a path of getting our fiscal house in order, making the hard decisions about spending and lowering taxes, which in the end has actually raised revenues so that we are in a position now to bring some additional tax relief.
Let me just briefly say on behalf of the farmers and ranchers of the country, and certainly those that I represent in South Dakota, that this is a wonderful plan for agriculture. The estate tax relief that is in here, the death tax relief which allows farmers and ranchers and small businesspeople to pass on their operation to the next generation without having to deal at the same time with the Internal Revenue Service and the undertaker, is, I think, a real tribute to the work that was done by this committee and a real asset and a real benefit to the producers of this country.
The health insurance deduction for self-employed individuals is critical. There are so many people in this country who are not able to deduct the premiums that they pay for health insurance policies and this allows for that to happen; an average benefit of about $382 to some 3.3 million people in this country who will benefit from that provision in the bill.
There is a small business expensing provision which will allow farmers and ranchers again the benefit of increasing the amount that they can expense out, and also a loss carryback provision for those who are experiencing losses, and there are a lot of them in my part of the country right now who, due to the price disaster, are losing money. It has been a tough couple of years, but they can take those losses and offset them against more profitable years and get a refund this year, which will tremendously help the cash flow situation and the problems that they are facing in trying to deal with the working capital they need to stay in business.
These are all provisions, in addition to income averaging which makes permanent that provision that allows farmers to spread out their income over time, and thereby lessen their tax liability in any one year. Farming and ranching is a very volatile industry when it comes to the income that they generate, a lot of ups and downs.
There are many provisions in this that are good for agriculture, and I think it is just remarkable at the same time we were able to dedicate
$1.4 trillion to saving Social Security and be able to help the farmers and ranchers of this country who desperately need help right now, who are trying to recover from the economic crisis they are in, in the form of tax relief.
I think this is a wonderful package and one that I hope we can move forward in the Congress, and I want to give credit to those of my colleagues who were instrumental in the Committee on Ways and Means and my friend, the gentleman from Pennsylvania (Mr. Fox) here as well who is on the floor this evening. I look forward to moving this and advancing it in the process in the hopes that we can make it the law of the land and help out those people across this country who have worked hard to give us the surplus and who deserve to have some of it back.
Mr. HAYWORTH. Mr. Speaker, let us not forget that a previous liberal Congress put upon the American people the largest tax increase in our history. Indeed, to quote a member of the other body on this hill, a liberal Senator from New York State, he said it was not just the largest tax increase in American history but the largest tax increase in the history of the world.
If there is one primary difference, it is this: Our common sense conservative majority believes that, Mr. Speaker, the folks who live in this country, who work hard and pay the bills, have worked very hard for the money they earn. They need to hold on to more of it and send less of it here to Washington.
My friend, the gentleman from Pennsylvania (Mr. Fox), has one point that he wants to bring out and I am happy to yield some time to him.
Mr. FOX of Pennsylvania. In my discussion previously, and I wanted to add on to what the gentleman from Arizona (Mr. Hayworth) said earlier, I had spoken, of course, of the programs to strengthen Social Security but also talked about modest tax decreases. I may have inadvertently said another word, but it is decreases and the tax cuts that are so important to our constituents back home. It is their hard earned money and we want to not only make sure that passes, but the private prepaid tuition plans are excellent. The bond value caps can help us with affordable housing, and also to help us with the school construction. All by having tax cuts, we are helping our communities. It is the opposite of what we had in the prior forty years with democratic rule, with tax increases which actually hurt us from having more jobs in the private sector.
Mr. HAYWORTH. Mr. Speaker, now to my right, fittingly, although he stands at the other microphone here in the well, it is another newcomer in this 105th Congress, the gentleman from Missouri (Mr. Hulshof), who has played a major role on the Committee on Ways and Means in bringing the tax bill to the floor and seeing its subsequent successful passage here in this chamber.
Mr. HULSHOF. Mr. Speaker, will the gentleman yield?
Mr. HAYWORTH. I yield to the gentleman from Missouri.
Mr. HULSHOF. Mr. Speaker, I thank my friend, the gentleman from Arizona (Mr. Hayworth) for yielding.
Mr. Speaker, the gentleman from Pennsylvania (Mr. Fox) has it just right. There is so much about this tax cut package that is to like. When we had this debate last week, as the gentleman knows, there was a lot of discussion and a lot of rhetoric being thrown around by our friends on the other side, especially when we talked about Social Security.
The beauty of this particular provision is that we want to take 90 percent of the projected surplus and put it aside to save Social Security; surplus funds, not monies needed to balance the Federal checkbook.
In fact, I came, Mr. Speaker, to this very floor and caused, I think, a little consternation because I had ten one dollar bills in my hand and I said, we have been talking in trillions and billions of dollars and sometimes that is a difficult concept to grasp, these numbers with so many zeroes. Let us think of it this way, and I had ten one dollar bills.
We wanted to take nine of those ten and fold them up and put them in our pocket and put that aside to save Social Security, to make sure that Social Security is there not just for today's seniors but for tomorrow's as well. Simply, what we want to do is take one dollar of the surplus funds, one dollar out of ten, and leave it in the pockets of those who earned it.
I am troubled by the statements made at the other end of Pennsylvania Avenue and talks of potential vetoes. In fact, the White House even said that we were, quote, squandering the surplus, squandering the surplus, by letting the American taxpayer keep what is rightfully his or hers.
There are so many things in this particular provision. The gentleman from Illinois (Mr. Weller) is exactly right. When trying to at least make a down payment on the elimination of the marriage tax penalty, we have much further to go, but certainly when my wife and I a few short years ago stood at the altar and said I do, it was not I do want to pay more in income tax, and yet that is the plight of many married couples in this country.
Simply by investing in the institution of marriage, their tax bill has gone up. I think that this provision does a good job of trying to level the playing field.
As the gentleman from South Dakota (Mr. Thune) talked about, farmers and ranchers who are having a difficult time right now in this country, there is relief for those farmers and ranchers, small businesspeople, with the death tax. All of those things are addressed, as the gentleman from Pennsylvania (Mr. Fox) talked about, the head of our economic development back in Missouri wrote a letter on behalf of our governor, a democratic governor as it turns out, urging us to increase the private activity bond cap because of the affordable housing issue. It is addressed in this bill.
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One of the things that I want to visit about is something that we have worked on specifically that would leave that dollar of that surplus money in the pockets of the low and middle income people in this country, and that is those who try to save, those people who try to put away their pennies and nickels. When you think about it, Mr. Speaker, they are being punished for their thrift.
I happen to have a 1040 form over here, modified just a bit, with a big circle and a slash. But when you think about, and I know this is maybe painful for you to think about April 15th of each year, but when you think about having to pull out the files and start to fill out your 1040, as we do most spring months, obviously most taxable income of most Americans is wages and salaries.
But when you consider that those of us that are able to put aside a little bit into a money market account, or maybe an interest bearing checking account, and any interest that we earn is being taxed, it is included in taxable income. And you carry it down here and you are being taxed on that amount, as you are the rest of your income, when many other countries actually provide some more incentives for their citizens to save and invest.
What this bill does is simply allow an exclusion up to $400, if you are a married couple, as the gentleman has been talking about with married couples, allowing joint filers to exclude up to $400 of interest or dividend income, to not be taxed, to put that back perhaps into other investments.
The Congressional Research Service has recently done a study just on this small saver provision that said this proposal would really benefit the low and middle income taxpayers, because it hits them more proportionately than it would somebody down at Wall Street. Of course, having thousands of dollars in investments a $400 exclusion is not likely to help that individual very much.
As the gentleman from South Dakota talked about a moment ago, not only is this good in a broad-based way as far as providing relief for millions of taxpayers, the small saver provision is helping 68 million taxpayers, but, more importantly, it is an issue of simplification.
I know a year ago when we had the debate about taxpayer relief of 1997, one of the constructive comments was this was not something that added to simplification of the Tax Code. This bill we passed in the House does just that.
As the gentleman talked about, how many millions of taxpayers will not have to itemize any longer, just because of the marriage tax penalty elimination? I know that certainly millions of taxpayers will no longer have to fill out this Schedule B form, the interest and dividend income exclusion. So we are simplifying the Tax Code.
By not requiring those additional calculations and forms, some I think 10 million Americans will no longer have to file a 1040, they can file a 1040 EZ just because of the small saver provision. Seven million will not have to trouble themselves with the Schedule B if this small saver provision is signed into law by the President. So not only are we providing broad-based relief, we are simplifying the Tax Code, which I think is something even our friends on the other side support.
Mr. HAYWORTH. I thank my colleague from Missouri. As we take a look at the many different provisions, and as I hear my colleagues remark on the different provisions that benefit hard working Americans, Mr. Speaker, I am reminded again of the many town halls that I have held back in the 6th District of Arizona, and I hear from people, and perhaps we ought to change the nomenclature, because we so often casually refer to small business. I think, Mr. Speaker, we should change that notion and redefine small business as essential business, because really those essential businesses, not with thousands upon thousands of employees, but those smaller enterprises, sometimes called mom and pop operations, indeed form the backbone of our economy, for those essential businesses, or, in common nomenclature, those small businesses employ more people than the corporate giants.
Especially for those Americans who are self-employed, how much I have heard at town hall meetings, ``Congressman, I am self-employed. When can I deduct my health insurance costs like the big guys in corporate America?'' And this bill does that, allowing for 100 percent deduction of health insurance premiums for the self-employed, including so many of our hard working constituents down on the farm.
My colleague from Illinois, raised on a farm, understands what this means. How vital it is that we accelerate that, how important it is for so many Americans who have waited for so long to enjoy what others in corporate America at least have not taken for granted, but have benefitted from in years past with our Tax Code.
The gentleman from Illinois.
Mr. WELLER. Mr. Speaker, I would like to thank the gentleman from Arizona for yielding. The point the gentleman is making is such an important one. We often talk about small business, and I consider small business to be Main Street, and, of course, two-thirds of the jobs that are created in our Nation and our economy every year are small business.
I meet on a regular basis with a group of women entrepreneurs in the south suburbs, and they made a point to me that I took to heart, a lesson. They said when you think about small business issues, small business issues are women's issues, because the majority of new businesses that are created and started every year today, the majority of them are started by female entrepreneurs. In the State of Florida, two-thirds of new entrepreneurs are female, are women entrepreneurs.
I think that is why what we did last year with restoration of the home office deduction is so important, because many of the women entrepreneurs, they start a business in the home.
Of course, then the health insurance issue is so important, not just to women entrepreneurs, but to male entrepreneurs and all small business people and farmers and entrepreneurs. When you think about it, our goal is to make sure that health insurance is affordable for everyone. Our goal is giving everyone access to affordable health care. Of course, we should really work to achieve that goal.
This is a big step, because by giving the self-employed, the entrepreneur, the same tax deduction that the big corporations on Wall Street get, it is an issue of fairness. We are working to bring fairness to the Tax Code by helping these entrepreneurs, which I pointed out earlier the majority of are female-owned enterprises, that is a big victory.
But the 90-10 plan is good for education, and helping our schools and those who want to send their kids to college and local schools has been a priority in this Congress in the last four years that I have had the privilege of serving here.
I think it is important to note that some of what some people say are the smaller provisions in this tax package actually are pretty important.
Last year we gave tax exempt treatment to prepaid college tuition programs for state universities, such as the University of Illinois and the other state universities in the State of Illinois that offer them. States like Pennsylvania and others do as well. But we bring fairness to the Tax Code by extending that same tax exempt treatment to the small private colleges, schools such as St. Francis and Olivet Nazarene University and Lewis University in the district that I have the privilege of representing now will be able to offer prepaid college tuition programs and help parents who want to send their kids off to college in a few years be able to make the tuition much more affordable. That is a big victory.
I also represent a growing suburban and urban district. One of the challenges we have in the older urban areas is the school buildings are older. We have maintenance, and we want to wire them with fiber for computers, and keep the technology up as well as keep the roof from leaking, they need help.
Last year we passed a school construction bond program as part of the tax package. We also provide over $1 billion in school construction bond assistance to not only the old urban schools in need of repair, but also help those suburban school districts in need of adding additional classrooms. I think that is very, very important.
Of course, raising the bond cap, as my colleague from Missouri pointed out, it is so important. We provide for a 50 percent increase. That is to be a big help in states like Illinois, not only helping to provide affordable housing for working and moderate income families, but also in helping infrastructure, such as helping expand our schools.
I think it is important to point out that this tax package helps married couples, family farmers, small business people and entrepreneurs, and also those who want to send their kids off to college, and helps schools add on additional classrooms and keep the roof from leaking.
Mr. HAYWORTH. I thank my colleague from Illinois for raising this part of this very human equation, because there is a temptation when we start talking about tax bills and tax relief to somehow put on the green eyeshade and pull out the calculators or the slide rules and deal with numbers, and, please, do not get me wrong, the numbers are important, Mr. Speaker, especially the $1.4 trillion which we pledged to set aside for Social Security.
But, moreover, there is a concept here that my colleague from Illinois touched on, and it is this: There are those in this city who still fail to learn the lessons of history, who would still have us believe that a centralized bureaucracy can make decisions for your family, for your school district, sadly I suppose ultimately for your children in a lot of ways, and I think our new common sense conservative majority says this: That we believe education is too important to leave up to Washington bureaucrats. There is no way that folks inside this beltway can micro-manage education. Indeed, sadly, one need only look to the schools inside this District of Columbia to see what disarray can befall an educational system at the hands of big government solutions and more and more spending with less and less accountability.
So what we are saying in this tax bill is for local school districts, to have provisions that they can use for capital improvements, for construction, for renovation. As my colleague from Illinois points out, that is the key. We understand that not all the answers exist inside the Beltway in Washington D.C., and we are better served when we transfer money, power and influence out of Washington and back home to people on the front lines, living their lives, educating their kids, and seniors in the dignity of retirement.
Mr. HOLSHUF. Mr. Speaker, if the gentleman would yield, there is another provision in this bill that I think has not been getting a lot of attention, and I know last year when we were debating tax relief, that we heard the mantra, the weary mantra from the other side, ``tax breaks for the wealthy.'' Yet in this particular bill, a colleague from the class of 1994, the gentleman from Oklahoma (Mr. Watts) working with another colleague from Missouri, a neighbor of mine, the gentleman from Missouri (Mr. Talent) from the 2nd Congressional District, the Watts-
Talent Community Renewal Provision, again, to set up I think 20 separate empowerment zones, especially in these areas, you were talking about the schools, but especially in these inner-city areas that have become blighted, where we have seen businesses that have fled from those inner-cities to the suburbs. This particular provision would have zero capital gains for private industry that chooses to go back into the inner cities, to revitalize and renew those communities. That provision is in this bill as well and has not been getting much attention.
Again, I think what all of these very strong provisions, I dare say that I do not understand how the White House can talk about vetoing, and that is casting aside this very good tax package, with all of the things included, plus this very important community renewal provision that has been cosponsored by the gentleman from Oklahoma and the gentleman from Missouri.
Mr. HAYWORTH. Again, there are so many positive provisions of this bill that I think all of us on this floor stand in amazement to hear the mindset of those on the left who, after 40 years time, never set aside a single penny for Social Security, Mr. Speaker. That is right, zero, zip, zilch, nada, not even an idea of how to set aside funds to save Social Security.
Yet to hear the tired old chorus, they would have you believe some sort of cynical mumbo-jumbo that this is something that Americans are not entitled to. It is some sort of gimmick.
No, Mr. Speaker, I think all of us on the floor and those of us who voted for this common sense tax policy say quite the contrary: This is not a gift to the American people. This is money that belongs to the American people. We do not sit here and deign to give them a pittance of what they sent in to Uncle Sam. It is their money to begin with.
So, Mr. Speaker, tonight as we continue to review these provisions, let us respectfully take issue with those who time and again come to this floor, or sadly on an annual basis to the podium behind us here, and display a mindset that would seem to suggest that tax relief for working people is candy or dessert or some special gift, as if it is an accident.
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Indeed, Mr. Speaker, the group here on this floor right now and other colleagues in this majority were sent to Washington precisely because the American people understand that they are not selfish for wanting to provide for their own families; that they are not selfish for wanting to have a greater control of their own destiny and their own futures; that they are not selfish for saying to Washington bureaucrats, we earned this money. We want to see a strong Federal Government, but not a government powerful enough to take away everything we have. That is the difference. Tax relief is not selfish; tax relief undergirds the notion of individual freedoms and a sense of responsibility.
I yield to my friend from Pennsylvania.
Mr. FOX of Pennsylvania. Mr. Speaker, I thank the gentleman from Arizona. The fact is that we would not be having this happy situation of a possible tax decrease if it were not for the fact that an historic balanced budget was adopted by the Republican-led Congress which has led to reduced costs for mortgage interest for the home, reduced costs for car expense loans, and reduced costs for education expenses. That has helped to spur the economy, have helped to increase employment, more people having jobs. The whole economy, we have seen it in the stock market, we have seen it in Wall Street, and we have seen it on Main Street, and that has led to the opportunity for what I believe should be a bipartisan tax decrease and a Social Security system that will be strengthened because of the passage of this bill.
We thank those of our colleagues who are on the Committee on Ways and Means for their leadership in starting the committee process.
I yield back to the gentleman from Arizona.
Mr. HAYWORTH. Mr. Speaker, it is just a common sense notion. Money does not belong to Uncle Sam, it belongs to the hard-working people of the United States, and those hard-working people ought to hang on to more of it and send less of it here to Washington.
The gentleman from Illinois.
Mr. WELLER. Mr. Speaker, I thank the gentleman from Arizona for yielding.
I think one good point to make, I was of course walking down the street in Joliette the other day and the President had just given a little talk, and, of course, he said we should not ``squander'' was his term the surplus on anything except his priorities. What I found interesting is that the President ignores that we are setting $1.4 trillion, or $1 trillion, 400 billion in surplus tax revenue to set aside to save Social Security, and, of course, the remaining 10 percent we give back to the American people.
What the President for some reason does not want us to know is that I, growing up on the farm, as my friend from Arizona, I say, judge someone not by what they say, but by what they do. The President says we cannot squander surplus tax revenues on a tax cut for families because we have other things we want to use it for.
The President opposes what is a pretty modest tax cut, a $16 billion tax cut next year, but he turns right around and proposes spending $20 billion of the surplus tax revenues on defense spending and on the State Department and other things that he feels are important.
So he does not want to give back to the taxpayer that extra tax revenue; he wants to spend it. And that is why it is so important that the 90-10 plan be enacted. Because what is exciting I think really for the folks back home is the 90-10 plan, by setting aside 90 percent of the budget, the surplus, extra tax revenue for saving Social Security and giving the other 10 percent back in tax relief is we prevent those politicians who ran up the massive deficits over the last 28 years from spending it. I think that is a big victory.
I also would like to point out another provision in this tax bill. I think that it is also very important, one of those we do not hear about as much. All of us here, the 4 of us here are strong supporters of welfare reform, and whether one is liberal or conservative on welfare reform, I think we all agree that we want to have jobs there for those who are on welfare so that they can raise themselves up and become an active part of the community and a taxpayer and join the work rolls and get off of the welfare rolls. One of the key provisions that is in this legislation is we continue, and we extend, a streamlined work opportunity tax credit, a tax incentive for the private sector to give those who are on welfare an opportunity for a job. That is a big victory, I believe.
I think of the area in the south side of Chicago and in the south suburbs, where many communities are impoverished, older industrial communities, and there are those, even though the economy has been pretty good, who are still on welfare, who would like to have a job, and because of the work opportunity tax credit, we have now seen thousands of Illinois welfare recipients having the opportunity to go to work. In fact, I can think of about 6 companies that have provided almost 3,300 jobs in the Chicago area to former welfare recipients, giving them the opportunity to lift themselves up and go to work. That is a big victory.
That is why this tax package is so important. The President and his friends would like to spend the surplus on the State Department and military missions in Europe and so-called other spending priorities that the President has, but that is $20 billion next year he would like to spend of the surplus. We are saying, now, wait a second. What we spend here should go through the regular appropriations process, should be under the budget rules and be part of the budget. Instead, that extra tax revenue we should give back and use it to save Social Security.
That is what is exciting about the 90-10 plan. Under that plan we help save Social Security by setting aside $1.4 trillion, $1 trillion, 400 billion in extra tax revenue that goes to save social security, and the rest we give back. Eliminating the marriage tax penalty for the majority of those who have suffered, helping family farmers in Illinois, helping small businesses in Illinois, helping schools in Illinois, helping those on welfare in Illinois go to work, and helping those who want to send their kids to college in Illinois. That is a big victory for the kids back home.
That is why I think it is so important that we continue to work for bipartisan support. We need to convince the President that it is the right thing to do. We want to eliminate the marriage tax penalty and we want to eliminate those other unfair provisions in the Tax Code. We want to save Social Security and eliminate the marriage tax penalty. It should be a bipartisan effort. My hope is that the President will join with us.
One message I have heard time and time again back home, and that is that the seniors always say, let us keep the politics out of Social Security. Republicans and Democrats should work together to save Social Security and they should also work together to eliminate the marriage tax penalty as well.
I yield back to the gentleman from Arizona.
Mr. HAYWORTH. Mr. Speaker, I thank my colleague and would just reiterate his comments on welfare and welfare-to-work and what this tax bill does in providing those opportunities to extend the work opportunity tax credit and the welfare-to-work tax credit. It is so vital, because indeed, there has been a disconnection in this city with the rest of America, because this city has, and those in the Federal Government and the bureaucracy, have measured compassion by the number of people added to the welfare rolls. We say true compassion, Mr. Speaker, is exactly the opposite. True compassion is moving people off welfare and on to work.
Almost 4 million Americans have left the welfare rolls and are now gainfully employed. That is true compassion. Those are true results. And they go a long way, and this tax package will help further that endeavor.
The gentleman from Missouri.
Mr. HULSHOF. Mr. Speaker, I appreciate the gentleman yielding. I know our time is drawing short.
In addition to one of the provisions in the bill that does not get a lot of air play, if you will, is the credit that we provide companies in this country to invest in research. Mr. Speaker, my friend from Arizona knows that technology is the key for America remaining on the cutting edge of being a world leader. In the past we have provided certain credits, tax credits for businesses who try those new ideas, who put into practice, as they ordinarily would, those innovative plans off the drawing board that they try to put into action. And that tax credit of course has expired, but now we include that tax credit, that research and development treatment so that companies and businesses, not just the big ones, but the mom and pops that think they can build a better mousetrap, that they can also have access by bringing those plans off the drawing board to make sure that we remain the most competitive among other nations across the planet, and it is something that does not get again very much discussion, but something I think that is very critical and crucial that is included in this tax plan.
Mr. Speaker, as a final point I would say to my friend and allow the gentleman to conclude, my colleagues here this evening, most of them were elected I think in the elections of 1994. As a new Member, someone who is just about to conclude his first term, there seems to be a universal attraction here in Washington between a pot of unspent money and a Washington politician. If we do not set aside this surplus money to save Social Security as we are doing, 90 cents out of every dollar, putting that aside, and then allowing 10 cents out of a dollar remaining in the pockets of the taxpayers who earned it, if we do not take the measures now, those affirmative actions now to shield off those surplus funds, it will be spent. It will be spent on big government, it will be spent on Washington.
So I very much applaud and support our efforts last week of taking 90 percent of projected surpluses, strengthening Social Security, shoring it up for the future. Again, not just for today's seniors, but for future generations of seniors, while at the same time of putting that 90 percent towards Social Security, and allowing 10 percent to remain in the pockets of the taxpayers who send it here to Washington. They deserve no less than that.
I appreciate the gentleman for allowing me to spend some time with him this evening.
Mr. HAYWORTH. Mr. Speaker, I thank my colleague from Missouri, also my colleagues from Illinois, Pennsylvania and South Dakota, for coming to the floor of the people's House to discuss the people's solution, grounded on 2 realities, Mr. Speaker. Number 1, our firm conviction that the money in the pockets of American citizens belongs to those citizens. Not to Uncle Sam, not to the Washington bureaucrats, not to a burgeoning Federal Government, which has grown leviathan through the years, but instead to the people of the United States who deserve to hang on to more of their hard-earned money and send less of it to Washington.
The second notion is this firm conviction, that to fulfill the social contract, time-honored over years in this century, we believe it is vital of the surplus we are projecting to set aside 90 percent of that surplus, $1 trillion, 400 billion to save Social Security. In stark contrast to our liberal friends who, during 40 years time in the majority, never quite found the time or the inclination to set aside 1 penny. We believe we owe it to today's seniors and future generations to save $1 trillion, 400 billion which will be devoted exclusively to saving Social Security.
Mr. Speaker, I suppose it really comes down to the policies of hope and prosperity versus the politics of fear and class-envy. Indeed, one year ago the President of the United States journeyed out of the District of Columbia across the river to the Commonwealth of Virginia where on a Sunday before a statewide election he proceeded to lecture the people of Virginia, essentially telling them that if they wanted their car tax reduced, they were being selfish. For all his alleged political acumen, sadly, the President was mistaken and his advise to Virginia voters last year was overwhelmingly rejected with the election of Governor Gillmor who has worked to reduce that unfair car tax.
Now, for all 50 States and the District of Columbia, we reaffirm this basic notion. That money should remain in the pockets of hard-working Americans, not as some cynical stunt as those on the left would have us believe, but because it is the right thing to do.
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This 90/10 plan provides, again, another modest attempt to ensure that Americans hold onto more of their money, thereby strengthening the institution of marriage, thereby strengthening the family, thereby strengthening local control of issues such as education, thereby strengthening seniors, who have seen the handcuffs taken off of the earnings limits; in short, to offer something to all working Americans, because, after all, Mr. Speaker, it is their money.
Mr. Speaker, in closing, I would address, through the Chair, the other body and those in the executive branch of government to join with us; to remain committed to the notion of a smaller, more effective Federal Government; to stay true to the notion of Americans holding onto more of their hard-earned money.
We would ask that, in a bipartisan way, even with the reality of a pending election in a little more than one month's time, that we join together. For if we do not, Mr. Speaker, again, what we have done is offered a clear choice to the American people: Do they want to stand up for a plan that recognizes that we should save social security by setting aside $1,400,000,000,000, and at the same time offering tax relief, reaffirming the promise of our individual freedoms and individual endeavors, and the fact that it is our money? Or do we want to return to the tired, old ways of the Washington bureaucracy, and the notion that Washington, D.C. knows best?
Mr. Speaker, the choice is crystal clear. But even now, while we rejoice in difference, we would ask people to cooperate, because after all, the American people have the most to gain.
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