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Veterans Tax Credit

Floor Speech

By:
Date:
Location: Washington, DC

Mr. DeMINT. Madam President, I want to speak for a few minutes about the proposed veterans tax credit. I know what I am about to discuss will not make me very popular. I will probably be accused of not supporting veterans by the politicians pandering for their votes, but I am not going to be intimidated into voting for something that may make sense politically but is inherently unfair, and it is not going to work. The measure the Senate is now considering at President Obama's urging is to offer tax credits to employers who hire unemployed veterans. It might sound like good politics, but it is not good policy.

We have learned over the past few years since President Obama took office that employers hire based on their long-term plans, not short-term stimulus. It costs an employer about $63,000 a year to create an average private sector job. A new tax credit for a couple thousand dollars is simply not enough to increase employment. We have to recognize the fact that businesses are not going to hire until the government gets out of their way and creates a stable environment where businesses can thrive.

Let's be clear: I want veterans to have work opportunities. Once a man or woman has completed his or her service to our country, I hope they are welcomed into the job market. But veterans are not hired simply because they are veterans. By and large, they demonstrate admirable qualities that are invaluable in the workforce, such as selflessness, hard work, and dedication to improving oneself. Many other Americans who are suffering in this same bad economy--such as single moms, young graduates, and minorities--also demonstrate these same commendable character traits. The best way to get our veterans back to work is by doing what will help the economy and get all Americans back to work. Sadly, this tax credit does not do that.

The government has tried offering credits to hire particular categories of people many times before. A Government Accountability Office report studied the targeted jobs tax credit that was passed back in 1978. The credit was intended to encourage companies to favor the disadvantaged in hiring, but a followup study found that it was not ``effective or economical'' in helping the targeted group. The program was eventually allowed to expire.

Unfortunately, that tax credit was quickly replaced with the welfare-to-work and work opportunity tax credits in 1996. The Urban Institute-Brookings Tax Policy Center studied these credits, which were intended to help the needy, low-income veterans, inner-city youth, and ex-felons. But it found that the credits had ``not had a meaningful effect on employment rates among the disadvantaged.''

President Obama signed another law, the Hiring Incentives to Restore Employment Act, in March of 2010 to give companies a tax credit to hire unemployed workers. There is no evidence this encouraged employers to hire, as unemployment has remained stubbornly high since President Obama came into office, especially over the last year while this credit was available.

Despite the overwhelming evidence that these tax credits do not stimulate hiring for targeted groups, the Obama administration continues to push Congress to pass another tax credit, this time exclusively for veterans. By using a politically sensitive group the day before Veterans Day, the Democrats are hoping they can trick Republicans into further complicating the Tax Code, when we should be doing everything possible to simplify it.

If we want to help veterans and all Americans, we need to get serious about fixing our economy. There are almost 14 million unemployed Americans and another 10 million underemployed and discouraged workers who need work. We need a simpler tax code that businesses can navigate, not a more complicated one, riddled with incentives for employers to hire one particular group over another. The endless morass of tax credits and loopholes is exactly what is wrong with our Tax Code. We should also repeal ObamaCare and Dodd-Frank, which are proven job killers. We will have a chance to vote on that later today. We need to open more domestic energy resources.

The answers are right in front of our faces. But, instead, we are pandering to different political groups with programs that have proven to be ineffective. We are giving more false promises to Americans in order to benefit political ends.

All Americans deserve the same opportunity to get hired. I cannot support this tax credit because I do not believe the government should privilege one American over another when it comes to work. I am deeply thankful for the courageous and selfless service of our veterans. They have performed for our country a service, and we will always be indebted to them. Above all, I am thankful for their sacrifices to protect freedom and equal opportunity in America. But we do not pay them back for their service and sacrifice with false promises of government programs that have been proven not to work.

Let's be honest with our veterans and with all Americans and do what we need to do to fix this economy.

Thank you, Madam President. I yield back and suggest the absence of a quorum.


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