Executive Calendar - Continued
Floor Speech
BREAK IN TRANSCRIPT
Mr. President, I wish to change the subject slightly. I will be back on the floor next week to defend my good friend and colleague Senator Cassidy's ideas on the reform of healthcare for America. He received a letter today from our Governor and the Secretary of our Department of Health and Hospitals, which, in my opinion, espouses points of view on healthcare that are not in the best interests of the people of Louisiana.
Just for a moment, I want to talk about tax reform because that is the other big issue in front of us.
Like the Presiding Officer, I have been in government for a while. I have great respect for professional economists, but it has been my experience that for every economist, there is an equal and opposite economist, and they are both usually wrong.
Economics today is more art than science. That is why I say it doesn't take an expert economist to see that something is wrong with the American economy.
Mr. President, 2016 was the 11th straight year our economy failed to achieve 3 percent annual growth, which has been our average annual growth every year since 1960. I have heard numerous pundits act like returning to 3 percent growth is something special, something extraordinary. No, sir, look at the numbers. It is just average, and I think the American people deserve better than just average growth, but even average growth is optimistic if we keep hamstringing the men and women who create the jobs in this country.
Our 40 percent business tax rate--let me say that again. Our 40 percent business tax rate and our broken Tax Code are chasing our ideas, our jobs, and our investors into the open, waiting arms of foreign countries. Our 40 percent business tax rate and our broken Tax Code are keeping wages and productivity low, they are crippling our small business women and small business men, and they have to go.
When we are talking about tax reform, I think it is very important that we not forget the primary vehicle--not the only vehicle but the primary vehicle for economic growth in America is the middle class, which is what I want to talk about for a moment, tax relief for ordinary people.
My constituents tell me every day: Kennedy, we look around in our economy today, and we see too many undeserving people at the top getting bailouts, we see too many undeserving people at the bottom getting handouts, and we are in the middle and we get stuck with the bill.
They say: Kennedy, we can't pay it anymore because our health insurance has gone up--thanks to ObamaCare--our kids' tuition has gone up, and our taxes have gone up. I will tell you what hasn't gone up, our wages and our income.
They feel that we in Washington don't listen and we don't care. They feel like they have no voice and no chance, and that anger is understandable.
This bar graph shows U.S. real median household income going all the way back to 1999. We can see where it was in 1999: slightly over $58,000. This is median household income. Of course, it took a dip in 2012 as a result of the recession, but look where we are in 2016. We are practically right where we were in 1999.
The middle class--the ordinary people of America--has made virtually no progress, and they have every right to be angry about that. It has been 16 years since President Bush's tax cuts, since the middle class has gotten a tax break. That is why I wanted to come to the floor today. Somebody has to speak up for the ordinary people of America and for our middle class.
Middle-class families drive our economic engine. We are a consumer economy. Seventy percent of our economy is based on consumers. They buy the goods and services our businesses are selling. They work hard to be able to spend and save and invest. Most middle-class Americans get up every day, go to work, obey the law, pay their taxes, try to do the right thing by their kids, and they are falling further and further and further behind. Now, as they are trying to balance a checkbook, nearly one-third of their income is automatically withheld and sent off to Washington, DC. They never even see it. Come April, they may owe even more on their savings and investments. If you don't believe me, look at the numbers. You think America is broke? Between October 2016 and January 2017--just one quarter--the U.S. Treasury set a brandnew tax revenue record of $1 trillion--$1,084,840,000,000. A lot of that money came out of the hides of ordinary people.
I will give you an example. Right now, if you are a middle-class family in Alexandria, LA--right smack dab in the middle of my State-- you have a household income of $59,000. You have two children. You want your children to have a better future than you had. You claim all your exemptions and you take the standard deduction. You are going to be paying the Federal Government about $3,500 a year.
That is not even counting what that middle-class family has to pay in State and local taxes or their payments to Social Security or Medicare. By the time their bills are paid and by the time they put gas in the car, that doesn't leave them much to work with.
I have an idea about how tax reform can target the middle class and bring ordinary people some badly needed relief. Seventy percent of Americans opt to take the standard deduction when filing their taxes-- 70 percent. They do that because it is simple, it is fair, and it requires less documentation than itemizing. In 2014, this option--this standard deduction--saved taxpayers of America about $217 billion. Yet they are still having trouble getting ahead. If Congress were to make one simple change as we enter upon this endeavor that we call tax reform--I call it tax cuts--like doubling the standard deduction across the board for everybody, including but especially the middle class, that would potentially inject about $600 billion back into our economy over 10 years. That is according to a 2014 CRS report. That would be an immediate shot in the arm to the American economy.
That family of four in Alexandria, LA, whom I just talked about would have their Federal tax bill cut to $1,700, freeing up almost $2,000 of their hard-earned income. That is $2,000 toward a new car, a new lawn mower, fixing their home, putting money back into their business, or saving money for their children's college education. It is pretty simple. It is also $2,000 right back into the economy.
As the cost of earning more is reduced, people will want to work harder. I believe people respond to incentives--not just Americans, but that is human nature. That means more productivity and more growth. It is economics 101. Unless you were throwing a frisbee in the quad, you were in an economics 101 class, and you know that if you give people more to spend and they spend it, the economy is going to grow in the process. I believe, Mr. President, as I know you do, that people can spend their own money better than the government can.
The strength of the middle class was the cornerstone of our past economic growth, and I think it will be the key to our future.
I have said it before, and I will say it again: We do need tax reform for businesses. I repeat: We do need tax cuts for businessmen and businesswomen--not just for the large C corporations but also for the passthroughs, the LLCs, the LLPs, the sub S corporations, and the sole proprietorships and family farms.
If tax reform does not include relief for the middle class, if it doesn't include relief for ordinary Americans, then we will lose a historic opportunity. It will be another generation before we will have this opportunity again, and we will never get our economy back on track unless we can close that loop.
We need to liberate the middle class and their power to spend and their power to save and renew their belief in the American dream. A tax reform policy that provides relief to the middle class, such as doubling the standard deduction--that certainly is not the only way to do it, but it would certainly do the trick--will give people the incentive to work and to save and to invest.
Our economic fate is tied to the health of our middle class. I am not saying that other parts of our great Nation, our economy, are not important, but the bedrock is the middle class. The bedrock is small business. And it is high time that we offer ordinary Americans a tax code that believes in them.
With that, Mr. President, I suggest the absence of a quorum.
BREAK IN TRANSCRIPT
Source