Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010
Floor Speech
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Mr. VAN HOLLEN. Mr. Chairman, I am pleased to have worked with Congressman Pomeroy and Chairman Levin and others on the amendment that we're going to be voting on later tonight.
While this House recently passed, and Democrats have been fighting, to ensure that tax rates do not go up on 98 percent of the American people, Senate Republicans made it clear that they will raise, that they will raise taxes on every American if they don't get a special bonus tax break for the very top 2 percent.
In order to break that stalemate, President Obama concluded he needed to cut a deal. What this amendment we will be voting on later tonight does is give the American people a better deal. Specifically, it asks all of us to consider this question: In an era of $1 trillion deficits, with our national debt approaching $14 trillion, barely 2 weeks after the bipartisan fiscal commission's ``Moment of Truth'' report, should we really be borrowing $23 billion from China to give the wealthiest 6,600 estates an average tax break of $1.7 million a year?
Think about it: $23 billion for the wealthiest 6,600 estates a year, at a time of fiscal challenge, in a Nation of over 300 million people, without any benefit for job creation or economic growth.
Mr. Chairman, much of the deal negotiated by the White House is defensible. But I would say to my colleagues, if we can't agree now that now is not the time to be giving the top three-tenths of 1 percent a multi-million dollar tax break, we're clearly not serious about bringing down the deficit.
There's another way, and that's in the amendment we will be voting on later today. We can adopt the amendment. It will provide a $3.5 million exemption and 45 percent maximum rate. That's identical, identical to the rates and exemptions that were in effect in 2009 and significantly better than the rates that will take place if we take no action on January 1 when the exemption would go to 1 million and the rate would go to 55 percent. In fact, if enacted, this amendment would represent the lowest estate tax in 77 years up through 2009.
Mr. Chairman, we have to level with the American people. We've got to start somewhere bringing down the deficits. And if we can't settle on the estate tax exemptions and rates that were in place in 2009, which, as I say, were the lowest, the lowest in 77 years, if we can't do that and, instead, we're going to say to the very wealthiest estates, heck, we're going to give you $23 billion over the next 2 years to benefit just 6,600 estates, how can we look the American people in the eye and say we're serious?
Mr. Chairman, I hope when this amendment comes up later today we can make this deal one that truly benefits all the interests of all the people in this great country.
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Mr. VAN HOLLEN. Mr. Chair, after much deliberation, I rise in opposition to today's legislation.
To me, this has never been about the wisdom or necessity of compromise. Like most of my colleagues, I understand the need for compromise, and I fully appreciate the predicament the President found himself in.
While Democrats have been fighting to ensure tax rates do not go up on 98% of Americans, Senate Republicans have made it abundantly clear they are willing to raise taxes on every American this January unless they get a bonus tax break for the wealthiest in our society--and provide a tax-cut bonanza to a handful of super-rich estates.
In order to break the stalemate, the President concluded he needed a deal--a deal that had to balance two of our Nation's very real but competing imperatives: the need to accelerate economic growth, and the need to reduce our national debt.
Some elements of today's legislation strike the right balance. In particular, the middle class tax cuts, unemployment benefits and Recovery Act credits for working families are both economically justifiable and likely to achieve their intended effect.
Unfortunately, other provisions significantly miss the mark. According to the Congressional Budget Office, the $89 billion spent extending tax breaks for upper income earners is unlikely to create jobs. Moreover, I have significant concerns about the structure and long term consequences of the payroll tax holiday.
But the tipping point in this package is the estate tax. In an era of $1 trillion deficits, with our national debt approaching $14 trillion, barely two weeks after the publication of the bipartisan Fiscal Commission's ``Moment of Truth'' report, does anybody really think we should be borrowing $23 billion from China to give the wealthiest 6600 estates an average tax break of $1.7 million a year?
Think about it. $23 Billion. For the wealthiest 6600 estates a year. In a nation of over 300 million people. Without any benefit whatsoever for job creation or economic growth.
I would say to my colleagues on both sides of the aisle that if we can't look this moment squarely in the eye and conclude that now is not the time to be giving the top three tenths of one percent of Americans a multi-million tax break, we are clearly not serious about tackling the monumental fiscal challenges we face.
And I would remind my colleagues that these fiscal challenges are not theoretical. Earlier this week, Moody's warned that today's legislation increased the likelihood of a downgrade to the United States' Triple-A rating over the next two years. Bond prices have fallen sharply and yields now sit at six month highs. If we're not careful, the bond market could easily take away what today's legislation aims to provide.
Many of my Republican colleagues supporting today's legislation profess a commitment to fiscal discipline and balanced budgets, but turn a blind eye to deficit spending so long as it arises from tax cuts. This is not coincidence. The rationale for the inconsistency has been succinctly explained by conservative activist Grover Norquist, who once proclaimed: ``I don't want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.''
After starving government, these same Republicans will undoubtedly be back in the 112th Congress demanding debilitating and draconian cuts in priority investments like education, clean energy and biomedical research. This playbook is as predictable as it is misguided.
Mr. Chair, we simply cannot afford to borrow billions of dollars to perpetuate wasteful and unwarranted tax breaks for our wealthiest citizens at a time of unprecedented and unsustainable national debt--tax breaks that do little for job creation and even less for the economy. I accept the need for a deal. But for our children and our grandchildren, I firmly believe there is a better deal to be had.
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