Service Members Home Ownership Tax Act Of 2009
Floor Speech
SERVICE MEMBERS HOME OWNERSHIP TAX ACT OF 2009 -- (Senate - December 09, 2009)
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Mr. CORNYN. Mr. President, I want to speak briefly about keeping President Obama's promise to the American people when it comes to tax increases in this health care bill.
You will recall on September 12, 2008, he said:
I can make a firm pledge: Under my plan, no family making less than $250,000 will see their taxes increase ..... not your income taxes, not your payroll taxes, not your capital gains taxes, not any of your taxes.
The problem we see, though, is this bill, as proposed, increases taxes for 25 percent of taxpayers earning less than $200,000 a year. That is 42 million individuals and families who will be taxed in a way that violates President Obama's pledge.
According to the Congressional Budget Office, the Internal Revenue Service will need many more agents and workers in order to enforce the Reid bill. It will essentially need to double in size the Internal Revenue Service just to be able to raise those taxes called for in this big job-killing bill.
The possibility of higher taxes is one reason job creators are currently standing on the sidelines. The President had a job summit. Yesterday he spoke at Brookings Institute and talked about initiatives he was going to undertake in order to help create jobs in this country. But the fact is, government doesn't create jobs except to the extent we grow the size of government. What we need to do in this country is to get out of the way, reduce the burden, and limit the uncertainty for the private sector--small business that is the primary job-creating engine in this country.
But the fact is, job creators are nervous--I would strike that; they are not nervous, they are scared--about one job-killing proposal after another coming out of Washington. Not just the spending, not just the debt, but they see things such as this big health care bill and the increase in taxes that go along with it. Then they see the President going to Copenhagen and perhaps trying to obligate our country to some additional financial burdens that are going to make it harder for these job-creators, not easier.
The debt, for example, is one looming disaster. The total public debt now stands at $12 trillion. Before the end of the month, the majority leader is going to come to the Senate floor, presumably on a Defense appropriations bill or some other vehicle, and ask us to lift the debt limit because Congress has maxed out the American people's credit card, and we can't keep running the government unless we increase the debt limit.
Well, a number of us are not going to vote for that increase in debt limit until we receive firm assurances that the administration and the majority are going to get real about this increasing debt and unfunded Federal liabilities in Medicare, in Medicaid, and other entitlement programs.
We are accumulating debt even faster during this fiscal year. For example, in just 2 months--2 months of this year--the Congressional Budget Office says an additional $292 billion in deficits were accumulated. Our deficits will average nearly $1 trillion for every year during the next decade, according to the Obama administration itself. Of course, I mentioned the other unfunded liabilities out there--things such as Medicare.
I understand the majority has somehow cut a tentative deal to try to grow Medicare. Well, if you grow Medicare and grow Medicaid, what does that do to the already $38 trillion in unfunded liabilities? This $38 trillion is three times our national debt. It means, in essence, a debt burden of $32,000 for every U.S. family. Yet my colleagues don't seem desirous of fixing this problem. They seem determined to make it worse.
Yesterday the Washington Post reported on our Nation's deteriorating fiscal situation. They said:
The problem is that, if investors think the United States isn't fiscally responsible--I wonder why they would conclude that? But they go on to say-- they could start demanding much higher interest rates when they bid on Treasury securities.
That is, when they start buying our debt, as a result of all of this spending and the money we have to borrow from China and other countries that buy our debt, those countries could begin to demand higher interest rates.
The Washington Post goes on to say:
The feedback loop could get ugly. The Nation could have to borrow hundreds of billions of dollars just to pay interest on what it owes. This has been touted as a classic path to irreversible national decline.
The Post cited Leonard Burman, an economist at Syracuse University, who said:
Right now, this year, we have $1.6 trillion in debt coming due--and that is before we pass this ill-conceived health care bill.
He said:
That's roughly twice individual income tax revenue. Our only plausible strategy for paying that back is to borrow more money.
The Post also cited David M. Walker, a former Comptroller of the United States, who recently testified:
Our total Federal financial hole is about $10 trillion more than the current estimated net worth of all Americans and the gap has been growing.
Then, adding insult to injury, yesterday Moody's Investors Service said its debt ratings on U.S. Treasury securities ``may test the Triple-A boundaries'' because the government's fiscal status is worsening.
Well, the fact is, this Reid health care bill makes this much worse. My colleagues say the CBO--the Congressional Budget Office--has scored the bill as deficit-neutral. Well, any bill can be called deficit-neutral if you are willing to raise taxes enough and cut programs such as Medicare, both of which this bill does.
The Congressional Budget Office said in their score of the Reid bill:
The long-term budgetary impact could be quite different if key provisions of the bill were ultimately changed or not fully implemented.
Well, what could they mean by that? What they mean is some of the assumptions about the cuts and other things that range over a 10-year budget window, if they don't come true, then all bets are off.
We know the Reid bill relies on budget gimmicks to hide the true cost of this Washington takeover. One gimmick is, for example, not including the Medicare provider fix, the so-called doc fix, which costs $210 billion over 10 years. In other words, this bill leaves that out entirely. I know--I am confident because Congress has only failed to act to reverse those cuts on one occasion--that if we let this cut in provider payments to physicians be fully implemented--a 23-percent cut come January--then many Medicare beneficiaries, including the vastly expanded rolls that would be included under this deal we have read about in the paper, patients will not be able to find a doctor to see them because doctors will not be able to continue seeing patients with a 23-percent cut in the payments they are entitled to under Medicare.
The other issue is the time shift. This is really sort of the classic shell game. The Reid bill starts the tax increases and the Medicare cuts in 2010, but as we know, the expanded coverage doesn't start until 2014. Someone said that is like buying a house, closing on the sale of a house, and being told: Well, you can't move in for 4 years. You have to start paying the bill today, but you don't get the benefits for 4 years.
The Congressional Budget Office score focuses on the budgetary impact to the government, not on the total cost to the American people. The CBO said the Reid bill increases the Federal budgetary commitments to health care. In other words, rather than trying to bend the cost curve as we have heard should be the goal, this makes it worse. We end up bending the cost curve in the wrong direction. The Reid bill will increase premiums for American families purchasing insurance in the individual market. The Congressional Budget Office hasn't yet been given time to estimate the total cost on the economy as a whole.
David Broder, one of the deans of the Washington Press Corps, did a nice roundup of nonpartisan experts last week. He cited Robert Bixby of the Concord Coalition, Maya MacGuineas of the Committee for a Responsible Federal Budget, and he concluded this:
Every expert I have talked to says that these bills as they stand are budget-busters.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. CORNYN. So I hope my colleagues will pass the Crapo motion to commit this bill to the Finance Committee so the President can keep his commitment not to raise taxes on the American people.
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