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Mr. GINGREY of Georgia. Mr. Speaker, today I'm here to urge our Democratic leaders to listen to the Republican Party, to listen to the Republican Party's bipartisan plan for taking immediate action on our already ailing economy.
If we let the Bush tax cuts expire, those tax cuts enacted in 2001 and 2003, Americans nationwide will face the largest tax hike in United States history. Indeed, that tax hike will amount to $3.8 trillion, and this at a time when unemployment hovers at around 10 percent and our national debt has hit an all-time high at $13 trillion--yes, $13 trillion with a ``T,'' an unbelievable amount of debt.
We need to freeze Federal spending. We need to cut taxes across the board, for everyone at every marginal tax rate level across the board. The state of the economy today is that 16 million people are unemployed. That equates to a 10 percent unemployment rate. Indeed, it is probably close to 17 percent. Mr. Speaker, if you count people who have just given up, who have been looking over 6 months for a job, there are none to be found, and also the number of people who are employed, yes, but underemployed, it would be close to 17 percent. So, indeed, the Republican Party and our leader says we need to freeze Federal spending, indeed, roll it back to the level of 2008, and cut taxes across the board.
And if we don't do that, Mr. Speaker, many companies that might have been in a position to expand and, therefore, put people back to work will choose not to because of the uncertainties associated with these tax hikes as well as other disastrous Democratic policies like ObamaCare. We need to come together, and we need to pass legislation immediately that cuts spending and kills all of the pending tax increases.
Mr. Speaker, we just returned to Washington, did we not, after 6 weeks in our districts, all 435 of us? I had many opportunities during that 6-week period of time to meet with my constituents face to face, eyeball to eyeball at town hall meetings. We called them America Speaking Out meetings, wanting the American people to know that at least one party wanted to hear from them, wanted to hear from Main Street, and did not want to force-feed on the American people, on our constituents, some grandiose plan that Members of Congress come up with. God knows that plans that Members of Congress have come up with over the last 4 years have certainly not helped one iota.
So I used this opportunity, my colleagues, I used this opportunity to speak to my constituents, but mainly to listen to them and to find out and write it down and bring it back to Washington to share it with my colleagues so we can make a pledge and make a commitment.
Indeed, one person, Mr. Speaker, suggested that why don't you call it this time, rather than a Contract with America that we remember from 1994, why don't you call it a Covenant with America, just like the covenant that God had with Moses and the Jewish people, something that is an absolute pledge of your sacred honor. Sacred honor, you heard my friend from Nebraska, Representative Fortenberry just moments ago on the floor, talk about the Constitution, sacred honor and our sacred documents.
And I think that is what the American people want. I don't think they will accept anything less. They are tired of the same old same old--excessive government spending and higher taxes that are making our country look a lot like Greece, Mr. Speaker.
So, I'm happy to have this opportunity, under the direction of my leadership, to take this time to talk to my colleagues about what we really need to do and what we really need to do in a bipartisan way.
No wonder, Mr. Speaker, that the approval ratings of Members of Congress on both sides of the aisle is 11 percent. People wanted to change 2 years ago.
People wanted a change 2 years ago. They made a change, but, indeed, it was not quite the change that they expected.
I want to refer my colleagues to this first poster, this first slide that I have here in the way of a cartoon, and hopefully all of you Members in the back of the Chamber can see this. It is a china shop, and it shows this depiction of our President going into the china shop talking to the clerk. And the caption is, as the President is speaking, ``Now, give me one good reason why you're not hiring.'' And of course behind the President are all of these bulls, these bulls in a china shop. This bull of cap and trade, this bull of health care reform, breaking all of the china.
Mr. Speaker, to ask the question: Now, give me one good reason why you're not hiring. Well, the American people can give a lot of good reasons why they are not hiring if indeed they have any capital left with which to hire or to expand their business, to increase the square footage, to put in a new product line, and to bring in additional workers for their small business. It is not happening because of bad policy, bad policy coming from inside the Beltway, not bad policy on Main Street.
Mr. Speaker, again as I did these town hall meetings, and I guess we did six or eight of them across the 11th Congressional District of northwest Georgia, nine counties that I represent, a great district, and I guess I would not be unique among us to say I think I have the best district of all 435, but I
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know we all feel that way about our districts. But the people told me, when I asked about the economy, what was concerning them the most, and we discussed the economy, and I asked, Why are we faced with a 10 percent unemployment rate? Why are 16 million people out of work, and why is it getting worse?
This is what they said: Excessive taxation; insufficient liquidity, which means they can't borrow any money. The banks are not lending. The small banks are having to set aside money to cover loan loss reserves and to abide by this mark-to-market accounting principle. People who have loans and are making payments on those loans, all of a sudden these loans are called and they have to come in and put up more collateral. And, of course, the regulators are really cracking down to the lending institutions. Poor mom and pop businesses can't borrow any more money. And if they have some money, or maybe there is someone who is unemployed who has a little nest egg who would like nothing better than to finally start that small business that they have wanted to start for years, they are finally almost forced into a situation. There are no jobs out there, so maybe they have $25,000 or $30,000 saved up and they want to start that little restaurant on the corner. They are not going to do it because of economic uncertainty, not knowing, Mr. Speaker, what is coming next that is going to hurt them rather than help them.
And the last bullet point on this particular slide, Mr. Speaker: Redtape, government mandates. OSHA. EPA. The new health care law. ObamaCare. The requirements for providing health insurance--and not just any health insurance, but one policy dictated by the Federal Government that these people understand they can't afford to abide by, so they don't start that business. So the unemployment rate, it continues and it gets worse.
Mr. Speaker, my colleagues, this next poster that I want to share with you has a lot of verbiage on it, and I know that it is difficult to read, so I will go through the bullet points with you. This is what it says. The latest Congressional Budget Office, CBO, that's the bipartisan accountants hired by the House of Representatives, the director of course is chosen by the Speaker of the House, Ms. Pelosi, but the bipartisan Congressional Budget Office and their economic outlook, the first bullet, this year's deficit is estimated to reach $1.3 trillion. As a share of the overall total economy of this country, the deficit is 9.1 percent, roughly three times the average of the past 40 years. Let me say that again. The deficit for this year, $1.3 trillion, is 9.1 percent of the total economy of the whole country, and that is three times what it has averaged over the last 40 years. Amazing.
The second bullet, the debt held by the public, is projected to rise to $9 trillion, or 62 percent of the economy this year, nearly twice the 40 year historical average. Total debt, including borrowing from the Social Security trust fund and other Federal funds, will rise to $13.5 trillion.
Finally, Mr. Speaker, the CBO also estimates that economic growth will remain sluggish over the next few years and unemployment will remain unbearably high for years to come. The looming tax increases and health care overhaul both contribute to slower growth and fewer jobs.
Colleagues, this next poster that you see basically depicts the slide that I just read to you in regard to the budget doubling and the tripling of the debt held by the public in billions of dollars, and this does not even include the Social Security trust fund that has been raided of about $1.5 trillion that has to be paid back.
So, colleagues, as we spend the next couple of weeks here in Washington before we break and go home before these midterm elections, what do we have to do? The President is talking about, and the Speaker of the House, Ms. Pelosi, and the leader of the Senate, Senator Harry Reid, are talking about letting the Bush tax cuts of 2001 and 2003 remain in place for all taxpayers except those who have an adjusted gross income of $200,000, or $250,000 for a family.
These are the very people who create the jobs in this country because many in that category are small business men and women who are not C corporations; they are subchapter S, or they pay their taxes as individuals. If you let those tax rates go from 33 percent to 36 percent or in some cases go from 36 percent to 39.6 percent and you leave the corporate income tax rate at 35 percent--and I have a flyer that I will show you, colleagues, in just a few minutes comparing the corporate tax rate in this country with other industrialized countries across the globe--it's astronomically high.
So how do we expect to get out of this deep recession, this economic morass, this high unemployment rate of 16 million-plus unemployed by raising taxes on anybody? It makes absolutely no economic sense.
I would urge my colleagues to come together with us in a bipartisan way. Let's do what Leader BOEHNER has suggested, which is to leave the tax cuts in place for everybody at every marginal rate at least for the next 2 years, and let's cut spending this year to 2008 levels.
Mr. KLINE of Minnesota. Will the gentleman yield?
Mr. GINGREY of Georgia. Mr. Speaker, I am very pleased to be joined by my classmate and colleague from the great State of Minnesota, the ranking member of the House Education and Labor Committee, Representative JOHN KLINE. I will gladly yield to Representative Kline.
Mr. KLINE of Minnesota. I thank my colleague. I thank my colleague for his words here this evening and for his leadership on this and on so many issues.
I just found it striking, Mr. Gingrey, that what you are talking about here is not only staggering debt, as the current chart indicates, but that you are talking about taxes. I want to take just a minute to put this into context.
We have been suffering with a struggling economy. We have watched the gross domestic product decline each quarter for the last three quarters. As you know very well, we have been looking at unemployment above 9 percent for 16 consecutive months, and this is after the passage of the trillion-dollar stimulus bill that the President said would keep unemployment below 8 percent. We have been at 9 percent or more and at 9.6 percent most recently, and now there is a proposal to impose the largest tax increase in American history on January 1, which is, of course, what will happen unless Congress takes action, unless the majority party in this body brings forth legislation that will keep that from happening.
I just wanted to join with my colleague, with Leader BOEHNER, with everybody on this side of the aisle, and with a growing number of our colleagues on the other side of the aisle who say let's don't do that, who say let's don't raise taxes on any American. Particularly to the point you were making earlier, let's don't raise taxes on the job creators. We are trying to create jobs. We are trying to let the private sector create jobs at the same time the majority party here is talking about imposing a crushing tax increase on the very people on whom we are relying to create those jobs.
So I just wanted to stop by to applaud your efforts here, to thank you for doing this today, and to add my voice to a growing number in this body who say let's don't do this.
Madam Speaker, let's don't do this.
Mr. President, let's don't do this.
Let's do not add to the tax burden of those who are creating the jobs in the private sector. Let's don't increase taxes on anybody in America. I think we need to say that loudly and clearly, and I have increasing hope that our colleagues on the other side of the aisle will recognize that that is a terrible thing to do in this economy and that we must move quickly.
As my colleague knows very well, there is an election coming. Congress will go into recess again here in 3 weeks or maybe 4 weeks or sometime, and I don't think we should leave and go into recess until we have taken care of this issue.
Again, I thank my colleague, and I yield back my time.
Mr. GINGREY of Georgia. Mr. Speaker, I thank so much my colleague from Minnesota, Representative Kline, for dropping by and for pointing out the things that we have been talking about.
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Quite honestly--and he alluded to the fact, I think, that we are beginning to get a little bit of bipartisanship on this issue. In fact, I was hoping, Mr. Speaker, that there would be a colloquy today between Majority Leader Hoyer and the minority whip, Representative ERIC CANTOR from Virginia. I wanted to hear what Mr. Hoyer might have had to say about this.
I've been reading in the newspaper--and maybe some of my colleagues have seen these articles, too--that maybe the Democratic leadership, represented so much so, of course, by Majority Leader Steny Hoyer and hopefully by the leader, the Speaker of the House of
Representatives, Ms. PELOSI, would begin to sort of go our way on this. I know a lot of Democratic rank-and-file Members, particularly those, Mr. Speaker, of the conservative wing of the Democratic Caucus--the so-called Blue Dogs--are very concerned about increasing taxes on anybody at a time such as this.
As Representative Kline pointed out, the tax increase of letting every one of those marginal rates go back up to the pre-2001 level basically eliminates the 10 percent tax bracket, and it expands the 15 percent tax bracket. I pointed out earlier that it raises the 36 bracket to 39.6, 33 to 36, 28 to 33, and 20 to 28.
In addition to that, what is expiring is the Child Tax Credit of $1,000, which will go back to $500, Mr. Speaker. The tax on dividends, which under the current law and enacted in 2003, is 15 percent, but if we let that expire, that tax rate on dividends will go to whatever one's marginal rate is, and if you happen to be at the 39 percent tax rate, that will be the tax on dividends. Many, many of our seniors are relying on dividends--on dividends and their Social Security--as their only sources of income. To tax that at nearly 40 percent, in some cases, is just cruel. It is unconscionable.
So, again, I do thank my colleague for weighing in on this; and this current slide, my colleagues, kind of shows that. The blue line on the graph shows the Democrat projection with the stimulus spending that was enacted and passed in February of 2009. So we're talking--what?--a year and a half ago. It was $862 billion, I believe, in that stimulus program that was supposed to get our economy back on track. That money, by the way, was money borrowed--yes, borrowed, in large part, from China and Japan. We hear that concern voiced so often. Yet that's what we did. We borrowed $862 billion, a lot of it from China and Japan, to stimulate our economy.
The pledge from the administration, from President Obama and from Congress was that this is what we need. If you pass that, our pledge to the American people is this unemployment rate, which was at 7.6 percent back a year and a half ago, will not get above 8 percent. We will stop this hemorrhaging of jobs by creating all of this spending for shovel-ready projects. I don't know how much of it went to that, but it was probably less than 5 percent of the $862 billion. Here, the graph depicts it.
So in the first quarter through the third quarter of 2009, that unemployment rate, which was 7.5 to 7.6 percent, wasn't going to go any higher. This is what the projection was going out to 2013. It was that our unemployment rate, because of the stimulus package, would gradually come back down to traditional levels of 4.5 to 5 percent, which was essentially full employment.
But this is what happened, my colleagues. The red line is what happened, unfortunately. And here we are in the third quarter of 2010, and what is our unemployment rate? Darn close to 10 percent. In fact, a couple of quarters ago it was over 10 percent. And as I said earlier about the unemployment rate, it's really worse than 10 percent, because many people have been out there beating the pavement, wearing out that shoe leather trying to find a job for 6 or more months, and they are still unemployed. And a lot of them, unfortunately, have just given up. Many of the jobs that we saw were census workers. That work has been completed, and unfortunately they're back in the ranks of the unemployed.
My colleagues, what I've been talking about, of course, in this next slide depicts it--the Bush tax cuts and what to do with them. The first bullet, ``Democrats are poised to let the 2001 and 2003 tax cuts expire at the end of this year.'' The effect of that would be a $3.8 trillion tax increase that will affect every American who pays income taxes. Unfortunately, only about 53 percent of Americans do pay income taxes, and that's part of our problem. But how in the world could we do this to the hardworking, tax-paying people?
Go back to that first slide of the bull in the China shop. Colleagues, that's what we're talking about. You break a lot of dishes when you raise taxes $3.8 trillion over a 10-year period of time. And answer this question for me--rhetorically, of course. What tax increase ever created a job? I don't think one ever did, and I don't think one ever will.
I spoke a little earlier about the corporate tax rate. Why is our corporate tax rate higher than--I don't know the total number of countries that we have here listed along the X-axis, but it's about 20, 25--Iceland, Ireland, Poland, Czechoslovakia, Hungary, Turkey, Switzerland, Korea, and on and on and on? And our corporate tax rate, effective, is almost 39 percent. That's the green column. Only Japan, at 40 percent, has a higher corporate tax rate than the United States. That makes no sense. We can't compete in the global economy with taxes like that.
I had talked a little earlier about the different tax rates and what will happen if we let the tax cuts, the lower rates, expire and we go back to those rates prior to 2001. I talked about dividends going from a 15 percent rate to, in some cases, a 39.6 rate. I didn't mention capital gains, but capital gains are now at 15 percent. That will go back up to 20 percent. And we, of course, talked about ordinary income and how those tax rates will go up for every marginal level.
We mentioned the Child Tax Credit of $1,000 per child, which will go back to $500 per child. I did not mention, but it's on this slide. I didn't talk about the marriage tax penalty, which under the current law had been eliminated, but starting January 1 of 2011, that marriage tax penalty kicks back in, costing a couple an additional $595 a year. That might not sound like a lot of money to Members sitting in this Chamber, Mr. Speaker, but it's a lot of money for a man and woman in their retirement twilight years on a fixed income. And, of course, I did mention that the lowest tax bracket marginal rate of 10 percent would completely be eliminated.
Well, let's get back for a few minutes to what I think we can do in a bipartisan way. This particular slide, Mr. Speaker, says it's the Republican plan. But you know what? I wish I had changed this slide before I got here on the floor this afternoon and scratched that out and put the ``Bipartisan Plan.'' Because other than the point that my people made to me at town hall meetings during the August recess about wanting us to do something about the economy, stop taxing them and regulating them to death, leave them alone, give them the opportunity to show their entrepreneurial skills, they said this, too: Why is it that you men and women in the Congress can never seem to work in a bipartisan way and do something for us, all of you? We love you, Congressman Gingrey, but you're part of the problem, too. You're all worried, it seems to us, about the next election, and you don't seem to be thinking about the next generation.
And I had to look them in the eye, eyeball to eyeball, and say, You know what? You're right. And my pledge, if I become part of the majority in 2011, is that we will work in a bipartisan way. And I hope my leadership is listening, and I hope that that will be part of their pledge.
So this poster really should scratch out the ``Republican Plan'' and put ``Bipartisan Plan.'' And I don't know why in the world we couldn't all agree on this. And we ought to do it now, not wait to see who's in control. The American people, I don't think--in many instances, they don't care who's in control as long as we're doing the right thing, as long as we are doing the right thing.
But this slide says, number one, freeze all of those tax rates for 2 years. We're in a desperate situation.
Is that asking too much to not increase the tax burden on the American people and small businesses and corporate America for 2 years? And secondly, cut spending back to 2008 levels.
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