ESTATE TAX AND EXTENSION OF TAX RELIEF ACT OF 2006--MOTION TO PROCEED -- (Senate - August 03, 2006)
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Mr. OBAMA. Mr. President, I rise to speak about the latest effort to reduce the estate tax for a small fraction of the wealthiest Americans at a cost to all Americans of more than $750 billion. This time our friends in the House of Representatives realized that the Senate would reject such a reckless policy. So rather than scaling back Paris Hilton's tax cut to a reasonable level or suggesting a fair way to pay for their tax cuts, they have done something else. They have decided to hold an increase in the minimum wage hostage to a fiscally destructive cut in the estate tax.
This is cynical politics at its worst. This is government by gimmick. Combining the estate tax with a minimum wage increase and temporary tax cut extenders is not an example of finding common ground or moving to a reasonable compromise; this is an example of political coercion. And the American people are wise to it.
This is simply an attempt to dare members of my party to vote against an increase in the minimum wage which has been one of our long-time priorities.
But why should we have to agree to nearly $800 billion of additional Federal debt--debt that our children and grandchildren will have to pay back in higher taxes down the road--in order to get a long-overdue wage increase for those struggling to make ends meet that would have no negative effect on the Federal budget?
Why should we have to agree to an average tax break of $1.4 million for several thousand wealthy estates in order to add about $1,200 on average to the incomes of several million working families?
Why should we have to agree to a permanent reduction in the estate tax for billionaires when all the tax benefits for students, small businesses, teachers, and neighborhoods will expire under this bill in a year or two?
This bill is not the outcome of a robust policy debate or bipartisan compromise in the public interest. It's not the result of honest tradeoffs. No. This bill is a cynical ploy to say ``gotcha'' to the Democrats. At best it's politically clever, but in no way is it smart.
Increasing the minimum wage would make a significant difference in the lives of this country's most vulnerable workers. The Federal minimum wage has not been adjusted since 1997 and the proposed increase really just keeps workers from falling further behind in their struggle to keep up with inflation. It is shameful that the President and Congress have not acted sooner to raise the minimum wage.
My colleagues on the other side of the aisle know that. So they have tied the minimum wage vote to the estate tax. They have tied the fate of several million working families and their ability to buy food and gas and school supplies to the ability of wealthy heirs to inherit even larger estates tax free.
I am confident that the American people will see through this. By 2009, the estate tax will already be repealed for more than 99 percent of all Americans. For the few estates that are wealthy enough to have to pay the estate tax, they can make unlimited charitable deductions, they can pass along at least $7 million to their heirs tax free, they can take more than a dozen years to pay-off the taxes owed, and the effective tax rate will be fair and reasonable. We could extend that status forever, and members of both parties could claim victory and move on to addressing America's real priorities.
Instead we are here once more, debating tax cuts and adding to America's debt.
Now let's be honest. This is not about saving small businesses and family farms. We can reform the estate tax to protect the few farms that are affected. We can set it at a level where no small business is ever affected. We can even repeal the estate tax altogether for the 99.5 percent of families with less than $7 million in taxable assets that means families with assets almost 100 times greater than the average American household's net worth. That would be compromise. That would be sensible.
Democrats have offered to reform the estate tax in these ways time and time again. But over and over, our offers have been refused, which can only mean that the party in power is really interested in an unprecedented giveaway to the wealthiest of the wealthy.
And don't think for a minute that there is any plan to pay for this. Every proposal to enforce pay-as-you-go rules for fiscal responsibility has been rebuffed. This tax cut will have to be paid for in the years ahead by higher taxes on working families and reduced public services in all of our communities. This tax cut will have to be paid for by higher interest rates on homes and student loans. And this tax cut will have to be paid for by greater dependence on foreign countries.
It's amazing to me how little the Congress has actually accomplished this year and how much time we have wasted on the estate tax. You would think the richest among us were the most oppressed. And even now we are being blocked from dealing with bipartisan pension legislation, not to mention dealing with the costs of healthcare, our real homeland security challenges, or the threat of global warming.
So if the Republicans want to bring up the estate tax yet again to use it as an election issue later, I say go for it. Because there may be no better illustration of how we differ in priorities than this irresponsible vote.
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