Tax Loopholes, Exemptions, and Deductions

Floor Speech

Mr. GRIFFIN of Arkansas. Mr. Speaker, I have been listening to some of the speeches here tonight, and I thought I would take a little time to address some of the arguments. But first I would like to just welcome my friend from Wisconsin, Representative Duffy, who joins me here on the floor tonight.

I've been listening, first and foremost, to the discussion of tax loopholes, tax exemptions, deductions. Specifically, I heard a lot of talk about tax deductions for oil companies. Well, I'm glad that the gentleman from the other side raised that tonight because I was thinking, and before I got here in January, for the last 2 years, this House was controlled by Speaker Pelosi and the other side of the aisle. The Senate, down the way here, is controlled by the same party, and the White House, President Obama. Now, if my math is correct, that means that Democrats were in control of the House; they were in control of the Senate; and they were in control of the White House.

Now, Mr. Speaker, it puzzles me that they were in control of all of those parts of government, yet not once did they eliminate these subsidies that they're talking about. They had control of the last Congress, 2 years, and nothing was done. I guess they decided only this year that subsidies for U.S. businesses should be eliminated.

Well, I'm not sure why they didn't do anything about that in the last Congress, but I will say that I am pleased that they understand the House budget that we passed because in our House budget that we passed a few months ago, that's exactly what we voted to do. We voted for a framework that eliminates tax deductions, tax exemptions, credits, loopholes, whatever you want to call them. That's what our budget does. And in doing so, we're following some of the proposals put forth by the President's own debt commission, a debt commission that he has yet to follow; but they recommended some similar proposals.

What we do is we lower the top rate and eliminate a bunch of the deductions that, admittedly, upper income folks take. So we eliminate those. But at the same time, we lower the top rate so that we can be more competitive, and we can have a pro-growth, pro-jobs Tax Code. So what we end up with is a fairer, flatter Tax Code, one that encourages private sector job creation.

You might ask, Mr. Speaker, Well, then, why do you disagree with the President on this particular issue? Well, like I said, we're happy that he's decided to come our way and that he sees the light on tax reform and closing loopholes.

The reason the House leadership is opposed to the President's posture on this in the debt ceiling negotiations is because they want to have their cake and eat it too. The President wants to have his cake and eat it too on this issue. He wants to close all the loopholes, yes; and at the same time, he wants to raise taxes. So he wants to increase taxes two ways; whereas, his own debt commission and our House leadership want to reduce the top rate, close the loopholes so that we have a fairer, flatter, simpler, less complex tax system.

So here's the contrast: we agree on closing the loopholes, although we can't figure out what happened last Congress when the Democrats controlled the House, Senate, and White House and did nothing about it. We did something about it. We approved a budget that addresses precisely this issue. So I just wanted to clarify our position on that.

I see that my friend from Wisconsin would like to say a few words. Please join right in.

BREAK IN TRANSCRIPT

Mr. GRIFFIN of Arkansas. I just want to ask the gentleman, what will it take for folks here to start wondering why businesses are leaving the country? It seems as if they always want to point the finger to someone else or some third party, some external cause. Maybe we should think about the fact that the policies adopted by the Federal Government have an impact. Businesses react to policies passed in this Congress, in the Senate, and particularly to regulations drafted, promulgated by the administration.

At some point we have to say wait a minute. Businesses are leaving, taking their jobs elsewhere. Maybe, just maybe, they're doing it because we're running them off. We need to ask that question.

Back in my district, in the Second District of Arkansas, in Little Rock and the surrounding area, I like to say, we've got big job creators and small job creators, but the common denominator is they're job creators.

I don't ask that people like business or be in business or whatever. I just ask that they acknowledge that businesses create jobs. And if we run businesses off, if we adopt policies that curtail economic growth and chase businesses away to other countries, we're going to lose jobs. That's not hard to figure out.

BREAK IN TRANSCRIPT

Mr. GRIFFIN of Arkansas. I think ultimately the standard for me is: Am I doing things that make the United States more attractive to job creators or less attractive?

We want to be a country where job creators around the world and here say, America is where I want to do business. America is where I want to innovate. America is where I want to create. America is where I want to pursue technological advancement and create jobs. America is the only place to do business. America is the only place to create jobs. That's the America that I want to help create. I don't want to create an America that punishes job creators in such a way that they flee the country. And that's exactly, on many fronts, what we're doing.

I yield to the gentleman.

BREAK IN THE TRANSCRIPT

Mr. GRIFFIN of Arkansas. I appreciate the gentleman raising the issue of Medicare. I'd like to take a few minutes to talk about some of the things I've heard here on the floor tonight.

First of all, if you're just joining us, I can just tell you that a little earlier tonight here on the floor there was a poster being used and the poster showed a tombstone. It showed a tombstone, and it said, "Medicare.'' And the implication was that Medicare was going to be killed; Medicare was going to be eliminated. And nothing could be further from the truth if we take action to save Medicare. If we allow Medicare to continue as it currently is with no changes, it goes bankrupt in anywhere from 5 to 10 years, if we do nothing.

Now, some of us have done something to save Medicare. What did we do? Well, we came up with a plan as part of our budget in the House to save Medicare for future generations.

Now, what other plans are out there? Right now, none. The Senate doesn't have a budget. The Senate doesn't have a plan to save Medicare. The President's budget doubles the debt in 5 years, triples it in 10 years, doesn't even deal with entitlements.

It got zero votes in the U.S. Senate and does nothing to save Medicare. In fact, it was so silent on Medicare and entitlements that the President had to come and give a Mulligan speech after we proposed our budget in the House. He gave a speech saying, Well, what I really meant was, and he laid out some ideas, not enough specifics--so few specifics, in fact, that the Congressional Budget Office said, We can't analyze that speech; we can't score that speech, not enough specifics.

So the Senate doesn't have a plan to save it. The President doesn't have a plan to save Medicare. We have a plan to save Medicare.

So what has happened? What has happened is the folks on the other side of the aisle made a conscious decision to attack our plan to save Medicare, and by doing so they engaged in a fiscal fantasy. What does that mean? Well, it means that they compare our reform with the way things are now with Medicare. They say, You're ending Medicare as we know it. Well, the problem with that is Medicare as we know it, on the path that it's currently on, goes bankrupt.

It would be one thing if they were comparing their reform plan to save Medicare with our reform plan to save Medicare, but they're not because they don't have a plan. So they prefer to compare our plan with the way things are now, even though they know the way things are now is going away. In fact, I'd like to read just a couple of quick quotes here.

President Obama has said: "If you look at the numbers, Medicare in particular will run out of money and we will not be able to sustain that program no matter how much taxes go up. I mean, it's not an option for us to just sit by and do nothing.''

Now, that's President Obama acknowledging that Medicare is going bankrupt, acknowledging that we must do something to save it, yet he hasn't proposed a plan to save it.

And another quick quote, Senator Lieberman, former Vice Presidential candidate nominee for the Democrat Party, now an Independent, he said: "The truth is that we cannot save Medicare as we know it. We can save Medicare only if we change it.''

That is the hard reality, and that is what we are trying to do is save Medicare. And that is precisely what we did in our budget that we adopted this year. If you're 55 or over, there's no change. If you're under 55, you would be in the new program, as Medicare would be constituted, what we call Premium Support. If you're 55 and over, as the gentleman said, there are no changes to you. We give folks time to transition to a new way of living under Medicare, a different kind of Medicare, but what we think would be more effective at reducing cost by putting in some market forces and saving Medicare for future generations.

I yield to the gentleman.

BREAK IN TRANSCRIPT

Mr. GRIFFIN of Arkansas. When I look at those charts, I ask myself: How big does our debt have to get before the other side of the aisle joins us in getting our fiscal house in order? How big? It is $14 trillion now--$16 trillion, $20 trillion, $50 trillion? How big does it have to get before the other side of the aisle admits that we are spending too much money?

I will tell you, I have been studying some of the details of our budget and how we got into this mess. I would be remiss if I did not comment on something I heard earlier today. Someone said: Well, the Bush tax cuts created our debt. That's how we got into debt.

Completely untrue. I took a chart that showed our revenue year by year as a percentage of the economy. And after 9/11, certainly the economy slowed down and our revenues, our tax receipts decreased significantly. But I can tell you that by 2007, our tax receipts were back up to about 18.5 percent of GDP. In 2007, and that was before the meltdown of the housing market in 2008, but that was while we had the Bush tax cuts in place--18.5 percent.

Now, what is interesting, if you go back and look at the mid-1990s, there were some years that had a higher percentage of GDP for revenue, but there are several years that are below that. My point is whatever contribution tax rates have had on revenue, the primary driver of how much revenue we get a particular year is whether we are having economic growth. That is the primary driver. That is the primary determining factor of how much money comes into the coffers of the United States Government.

The idea that we got in this mess because we are somehow as Americans not taxed enough is ludicrous. All you have to do is look at the spending pattern and the trajectory of the debt that you just put up there. It follows the same path, revenue relatively steady over the decade at an average of 18 percent of GDP. And expenditures--spending--off the charts, particularly in the last few years.

I just want to be real clear here, both parties are to blame. The Congress is to blame. The House is to blame, the Senate, the White House. There is plenty of blame to go around. There is plenty of blame to go around. That's not the issue. The issue is how we fix it. And we first have to recognize that we have a spending problem.

BREAK IN TRANSCRIPT

Mr. GRIFFIN of Arkansas. I just want to close by mentioning the discussion of the debt ceiling. What I would say to the President tonight is that this House has put forth a plan. We have a plan in the form of our budget. But we also have a plan in the form of our Cut, Cap, and Balance where we cut spending and we cap spending in the future and we move toward a balanced budget. We passed that here in the House the tonight. That's a plan. That's a plan that we can debate. We can discuss. The President can criticize. But what we haven't seen from the President is a plan. A plan of his that we can look at and study and that the American people can consider.

I would just ask the President to put his ideas out there. Come out of those rooms and put his ideas in public and let us analyze them and discuss them and let the American people examine for themselves.

Source