Jobs and Growth Reconciliation Act of 2003 - Continued Amendment No. 619

By:  Lindsey Graham
Date: May 14, 2003
Location: Washington, DC

JOBS AND GROWTH TAX RELIEF RECONCILIATION ACT OF 2003—CONTINUED
AMENDMENT NO. 619

The PRESIDING OFFICER. The Chair recognizes the Senator from South Carolina.

Mr. BAUCUS. Mr. President, I urge the Senator, at this late hour, to speak briefly so everybody who wants to speak can. The bewitching hour arrives at about 10 minutes after midnight tonight.

Mr. GRAHAM of South Carolina. With that in mind, I will be very brief.

Mr. President, I do appreciate the opportunity to be recognized very briefly. The reason I want to speak is to recognize the Finance chairman's great job, taking a pretty bad situation and making the best of it. It got off to a rocky start in the Senate about how to craft a tax package to help stimulate the economy. But I am very impressed by what has happened.

Almost everyone has some view of how to cut taxes. That is good for the American public. I am not here to criticize my colleagues on the other side who have put forward tax packages. I think we all see the economy soggy—whatever adjective you want to use—but both parties have a view of getting money back into the economy. That is good.

I congratulate those who have stepped up to the plate to put money back into the economy. I may disagree with your approach. But also I would like to congratulate those Senators who took the road less traveled; that is, saying: We do not need a tax cut. We cannot afford a tax cut. We are in deficits. Now is not the time to take money out of the revenue stream.

We should be retiring the debt. To those Senators, I say, you are absolutely right in terms of having a philosophy that makes sense.

The problem is, if we do not cut taxes, we have shown a propensity, particularly our friends on the other side, to spend the money. That is an overarching thing that I think is well-documented.

It is not a debate as to whether we will take the $350 billion, the $152 billion, the $550 billion, or the $726 billion, and put it on the debt. That is not going to happen. That should happen, but it is not going to happen.

So now the debate becomes, how do we take whatever money we are going to set aside for taxes to create jobs? Because if it does not create jobs, I am not going to vote for it.

Twelve Democratic Senators joined with the President and members of the majority party to cut taxes in 2001 in a very comprehensive manner. A lot has happened since that tax cut: America has been attacked, the defense spending needs have gone up, the Iraq war has come, and a lot of money has been spent. But I would argue that everything we have done to make America stronger, to free the people of Iraq, making us stronger, is money well spent. Let's keep that same theme of spending our money wisely.

The one thing that disappoints me about my friends on the other side is that every amendment they have to offer or every approach to taxes goes after the dividend tax cut. That is the centerpiece of the President's view of how to stimulate the economy. Every amendment being offered takes money from the dividend tax cut to pay for that amendment.

The best example of what is going on here is Senator Dorgan's amendment about repealing the Social Security tax. A month ago we had a chance to do that, and our friends on the other side en masse voted no. We had a chance to expand the budget resolution by doing away with the tax on senior citizens at the 85-percent rate on their Social Security. This tax was put in in 1993 by our friends on the other side. I would argue that offering this amendment now is the best evidence one could point to as to what is going on here. Everything this President is asking for in terms of job stimulus and economic activity beyond helping people put money in their pockets goes to the dividends, double taxation exclusion.

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The Senate Finance Committee has produced a bill that addresses that problem. There will be an amendment on this floor that will basically mirror what the President has asked for. It will take taxation dividends to zero for a 3-year period.

I honestly believe that is the best way to create jobs simply because if you could buy stock and receive a dividend without paying taxes, more people would be likely to buy stock. People say the stock market would go up 10 or 20 percent. I don't know if that is right or not, but that makes sense to me.

The $350 billion tax proposal by Senator Landrieu I disagree with. But you have to understand that the difference between Senator Daschle's plan of $152 billion, the Finance Committee's of $350 billion, and Senator Landrieu's amendment of $350 billion is negligible in terms of the money it takes out of the economy to help people receive tax benefits. So this argument that our President's plan doubles the national debt has to give way to facts. Everybody is wanting to cut taxes.

The point I am trying to make is the American people have to choose between these competing plans. We will have to choose. Here is what I am going to do. I am going to make a choice to take the tax package that was passed in 2001 and accelerate the benefits. Because the reason we haven't received the full benefit of the 2001 tax package is we put everything off in terms of rate reductions. Let's take the money we are putting on the table now and accelerate the rates. Let's accelerate the child tax credit so people will have more money to spend. But let's do something we didn't do in 2001. Let's create a system so that jobs can be created by economic activity.

You will never convince me that if you make an investment in the stock market more attractive, people will not have better jobs, and there will be more jobs for people. That is why I will follow the lead of the President.

I am pleased that I am a Member of the Senate at a time when both parties want to cut taxes.

I yield the floor.

Mr. GRAHAM of South Carolina. I rise today to tell you about an urgent issue in my State that could benefit from the same relief this bill provides for Arkansas schools. The relief is known as "advance refunding."

Just like homeowners, municipally owned utilities are able to refinance or "refund" their bonds. But the Tax Code permits them to do this only once. Imagine if you had refinanced your home at 7.5 percent a few years ago. Having taken that one opportunity, now that rates are at 5.15 percent, you would not be permitted to do another refinancing. You would miss out on this opportunity to refinance.

There is a utility in my State that finds itself just in this position and all of the utility's consumers suffer the consequences. Without an additional advance refunding, it customers face significant rate increases as the utility struggles to remain competitive in the restructured marketplace while paying off debt it incurred to bring electricity to many customers in my State. I want my constituents to enjoy stable rates just as I know yours do, Mr. Chairman. I ask if you would work with me in this conference to provide additional advance refunding relief to meet this urgent need in my State.