Military Construction and Appropriations Act, 2008

Floor Speech

MILITARY CONSTRUCTION AND APPROPRIATIONS ACT, 2008

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Mr. CORNYN. Mr. President, the August recess has given us all an opportunity to return to our constituents and reconnect with the people of our States and listen to what is on their minds, not just what we hear inside the bubble in Washington, DC. For my part, the issues I encountered wherever I went in Texas were concerns about the economy, about jobs, about Government spending. Many people are concerned, and given, unfortunately, the recent history of the Congress and the budget that has already passed, I don't blame them for their concerns. There are some very real reasons they should remain concerned about taxing and spending in the Congress.

Mr. President, you will recall that in 2001 and 2003, when Republicans were in the majority, Congress passed well-timed tax relief that helped the economy overcome the fallout from corporate accounting scandals of the late 1990s, the bursting of the tech bubble, and the horrific attacks of September 11, 2001. This well-timed and important tax relief put money back into the pockets of working families all across America, in the pockets of small businesses and entrepreneurs, and as a result, the economy has bounced back in an incredible and impressive way. Items such as bonus depreciation and the $100,000 expensing have allowed entrepreneurs and small businesses to grow, not only helping their owners and their families but also creating jobs for their community.

We doubled the child tax credit for working parents. We provided tax relief to all taxpayers from higher marginal tax rates. We reduced the marriage tax penalty and protected millions of taxpayers from the alternative minimum tax. We also provided capital gains and dividends tax relief for small investors, which have helped increase economic activity and fill the Government's coffers.

We continue to benefit from this tax relief we are enjoying by seeing 8.2 million new jobs created, nearly 6 years of uninterrupted economic expansion, and surging tax revenues that have far outpaced projections and helped lower the deficit. In fact, last month, the Congressional Budget Office reported that the budget deficit will fall by more than one-third this year and is almost $20 billion lower than its previous estimate. Meanwhile, it was reported that the economy grew by 4 percent last quarter alone.

Unfortunately, there are some on the other side of the aisle who want to fix what is not broken and roll back the progress we have made with the tax relief passed in 2001 and 2003. Instead of talking about tax relief for hard-working Americans, there are those who are talking about raising taxes on Americans. Instead of talking about supporting the American entrepreneurial spirit, some are talking about expanding the size of Government and increasing Government spending.

First, we passed a budget a few months ago that contemplated the largest tax increase in our Nation's history, not as a result of the vote of Members of the Congress but by allowing the temporary tax provisions I mentioned a moment ago to expire without taking a single vote. This budget stacked the cards against taxpayers by making it easier for Washington to raise taxes. Then the Senate considered tax policies on a so-called Energy bill that produced no new domestic sources of energy. Instead, it would have reinforced America's dependence on foreign energy sources. At the same time, we have seen legislation pass that raises taxes that especially hits low- and middle-income individuals hard.

Next, we saw proposals rejected that would have forced Congress to err on the side of the people by making it more difficult for the Senate to raise taxes. For example, a 60-vote point of order against legislation that raises income taxes that overwhelmingly passed the Senate but was later stripped out during the conference committee on the budget.

In addition, some on the other side of the aisle have proposed to raise the Federal gas tax at a time when the price of gasoline remains around $3 a gallon. They have also proposed legislation that slaps what I believe could accurately be called a competition tax on America's entrepreneurs and small businesses by making it more difficult to keep capital at home and to attract capital from abroad. After all, capital formation is the lifeblood of domestic job creation.

Finally, some have actually advocated rolling back the 2001 and 2003 tax relief that has done so much good for American businesses and provided my home of Texas with historically low unemployment rates.

As this chart shows, American workers will have to work 79 days just to pay for their Federal taxes this year. And that, of course, is on top of the 41 days to pay their State and local taxes--which we can see far exceeds any other category, whether it is housing and household operation or health and medical care or transportation, clothing, or other items. They are far exceeded by the Federal tax bite taken out of the average taxpayer's paycheck.

We have been treated to an interesting debate during the Presidential primaries already to see how leading Presidential candidates compare on various tax issues. We have seen proposals from the top Democratic candidates to actually raise the individual tax rate to 39.6 percent from 35 percent. We have seen proposals from the top Democratic candidates to tax private equity, carried interest at higher ordinary income rates, and we have seen a proposal to preserve the death tax.

On the other hand, top Republican candidates have proposed to preserve the tax cuts, including the 35 percent top rate, preserving the lower capital gains rate for carried interest, and we see on the bottom the difference in the way the top Democratic candidates for President and top Republican candidates for President would treat capital gains and other taxes.

Invariably, it seems as if the differences are between those who would take more of a tax bite out of the hard-earned income of the American taxpayer and spend more on Federal Government and those who believe the people who earn the money deserve to keep more of what they earn. This tax relief has given rise to an unprecedented expansion of the economy and job creation beyond some of our wildest dreams.

The politics of tax and spend has unfortunately crept back into Washington and threatened to undo a lot of good work that has been done over the past several years. One rather confusing example is the recent passage of the reauthorization of the Children's Health Insurance Program. This bill increased the CHIP budget by 300 percent, effectively raising taxes to cover the expenditure. But this program has also increased the scope of CHIP coverage to include families of four with an income of more than $80,000, some 400 percent of the poverty level. This creates the double standard of such families being in need by CHIP standards but wealthy under the Tax Code. Our laws should never contain such a ridiculous double standard.

This battle for higher taxation and fiscal irresponsibility is nowhere more evident than it is with the confirmation of Jim Nussle as the head of the Office of Management and Budget, a nomination we will be voting on later today. Despite the progress and economic boom that I have described, many Members of Congress are fighting against this nomination, even though this former chairman of the House Budget Committee was a major architect of these successful tax policies which I have described. The House majority leader even remarked that from 2001 to 2006 Congress had ``pursued the most fiscally irresponsible policies.'' And while our current economy seems to contradict that statement, the American taxpayer must certainly disagree.

Congressman Nussle has a long and well-established history of financial responsibility and is considered by many to be a leading expert on budget issues and the Federal budget process. Congressman Nussle has worked hard to try to pass meaningful earmark reform, even before it became a popular political rallying cry. He was instrumental in writing the welfare reform bill, and he successfully passed six budgets. Finally, Congressman Nussle has been repeatedly praised for his work on taxes by national organizations such as Americans for Tax Reform, the National Taxpayers Union, Citizens Against Government Waste, the Council for the Committee on Government Reform, and the National Tax Limitations Committee.

As we move forward, the last thing we should do is to reverse the policies that have helped bring around America's economy, reduced the deficit and put more money in the pockets of Americans. Indeed, we must pursue economic policies that encourage growth and protect the interests of America's taxpayers. The best way to do that is by maintaining the tax relief that has already helped millions of hard-working Americans and by confirming Jim Nussle as head of the Office of Management and Budget.

Mr. President, I yield the floor and suggest the absence of a quorum.

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