Small Business Jobs and Tax Relief Act
Floor Speech
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Ms. LANDRIEU. Madam President, as chair of the Small Business Committee of the Senate, I am pleased to come to the floor to give some supporting remarks for Senator Schumer's small business tax reduction bill. The bill will invest, basically, $20 billion to the bottom line of small businesses--owners of businesses that are dynamic and that are growing. I would like to make that distinction. It is not all small business that will get tax relief. It is small businesses that are dynamic and growing and adding employees or increasing wages.
The bill is smartly and narrowly targeted to motivate and to reward those small businesses, a subgroup of the 28 million small businesses that exist in the country today, many of which are in the Senator's State, Minnesota, that has some very high-growth, high-potential small business development in the medical field, I understand. In my State, it would be those businesses that are growing because of the increased demand for energy and the new technologies that are coming out, not only for oil and gas production, which is important, but also other sources of energy. In Ohio and Michigan, it could be those small business suppliers that are rallying around the emerging and strengthening automobile industry, which President Obama and the Democratic Members of this Congress had so much to do with salvaging.
Our business is not just throwing money against the wind. It is taking precious taxpayer dollars and targeting them to those businesses that are growing. That is why, as the chair of the Small Business Committee, I strongly endorse Senator Schumer's proposal over the proposal that came from the House of Representatives.
The House of Representatives' bill basically is taking $40 billion that we do not have--we do not have the $20 billion either but one is half the cost--taking $40 billion and throwing it at businesses, 50 percent of which, according to the CBO study, will accrue to the highest income earners in the country--over $1 million. It is not targeted. It is just about business profits, which are important. I know businesses are in business to make profits. I have no problem with that. We want our businesses to be profitable. But the Schumer proposal, relative to the Cantor proposal, is targeted to those businesses making a profit and reinvesting it in the business to grow--hiring workers and putting behind this recession we are coming out of--a recession because of poor policies of previous administrations--coming out of this recession to help grow the economy.
We can give tax cuts in a variety of different ways. If we had all the money in the world, maybe we could afford to do both, but we are not that fortunate. We have to make choices. That is what we do on the floor of this Senate every day, make choices, make distinctions between wise ways to spend money and poor ways to spend money.
I suggest, if we have $20 billion to spend, if everybody agrees we have at least that, that the Schumer approach is much more efficient, will be much more effective, will get much more bang for the buck than the Cantor approach.
I commend Senator Schumer for putting his bill on the floor, the Small Business Tax Relief and Job Creation Act of 2012. According to the National Economic Council, the tax credit would provide $20 billion in direct tax relief for businesses that hire new workers or increase wages, and it could encourage an additional $200 to $300 billion in new wages and jobs this year.
This tax credit, as I said, makes sense. It will help create jobs. According to the Congressional Budget Office report released last year, the CBO report from November of 2011, policies that have the largest effect on output and employment per dollar of cost in 2012 and 2013 are the ones that would reduce the marginal cost of hiring. That is exactly what the Schumer bill does.
Firms that make capital investments in 2012 would be allowed to deduct the full value of the investment on their 2012 return. We know this kind of targeted tax cut can spark demand that small businesses have been clamoring for. This tax cut is an extension of a tax provision that expires in 2011 and had yielded an estimated $50 billion in added investments and lowered the average cost of capital for business investment by over 75 percent, according to the National Council of Economic Advisers.
We have had a lot of experience in the Small Business Committee and in the Finance Committee, on which Senator Schumer serves, in the last couple years designing and implementing tax cuts for the middle class, tax cuts for the job creators. Again, if we look very objectively, considering the Schumer proposal costs half as much as the Cantor proposal and will probably do three times if not four times better, it is a no-brainer which one is more effective; that is, the Schumer proposal.
Our hope is if Senators come to the floor and begin to look more carefully at the Schumer proposal versus the proposal that came from the House, they will realize the benefit of the Schumer approach and give it the 60 votes we need to move it forward
and will reject the Cantor approach as being too expensive relative to the other option that is on the table and much less effective. In the event the Senate decides to do neither, which might happen because there have been logjams around here for a while now, I have to say I was very proud of my colleagues Barbara Boxer and Jim Inhofe for working to break the logjams in a spectacular way just 2 weeks ago on the Senate floor when they finally negotiated a 2-year transportation bill, the flood insurance bill, the RESTORE Act, and the student loan reduction bill, which is the remarkable work the Congress did last week.
In the event the Cantor proposal fails and the Schumer proposal fails, I am hoping to offer an amendment that the leadership is considering now that was put together by the Snowe staff and the Landrieu staff over the course of the last several weeks. The only name on this right now is mine, but it has been put together by a variety of Senators who have been working across the aisle for months on items that are very important to the small business community.
Again, we have 28 million small businesses in America; 22 million of them are single employers. In other words, they are self-employed professionals who are doctors, lawyers, landscape architects, architects, other service providers, network professionals, and IT professionals who are working in their own business and employ themselves. They are very valuable. We encourage entrepreneurship in America. We may have more entrepreneurs per capita than any place in the world. We believe in it and we are excited.
We are also excited for our businesses that start with two or three employees, and before we know it they have 200 or 300 employees. Then, when we close our eyes and open them, they have 2,000 employees. That is very exciting. We call them the gazelles. We look for accelerating opportunities.
As I said, we put this package together with the significant input of Senator Snowe and her staff, along with input from Senator Kerry, who has been an extraordinary leader in this way. Senator Merkley, Senator Cardin, and a list of other Senators whom I am going to refer to have been working for years on some of these issues. I wish to make sure I give them the credit for these issues.
First in our package is the very popular and very effective 100-percent exclusion of capital gains for investments in small businesses. It was part of the small business tax extenders package. President Obama has recommended this and Senator Kerry is the lead sponsor, along with Senator Snowe, on the Finance Committee.
Let me give a little background. Until 2009, noncorporate taxpayers were allowed to exclude 50 percent of the gain from the sale of the stock of a qualified small business if taxpayers held the stock for 5 years. The Recovery Act increased the 50 percent to 75 percent and the Small Business Act of 2010 subsequently increased it to 100 percent. As of January this year, it was reverted down to 50 percent and startup investments are no longer entitled to the preferred capital gain treatment.
Our proposal would basically take this up to 100 percent exclusion from the sale of capital gains that noncorporate taxpayers purchased in 2012 and 2013 and hold for 5 years. It has bipartisan support. As I said, Senator Kerry has been the lead advocate. Senator Snowe has worked side by side with him, and along with Senator Moran, Senator Warner, Senator Coons, and Senator Rubio have all called for this provision to be permanent. I wish we could make it permanent. This bill will not make it permanent, but we will extend it for another year and a half.
According to the Kauffman Foundation paper published earlier this year--and the Kauffman Foundation, for those who don't know, is the leading think tank. It is not political at all. It is just a middle-of-the-road, well-respected think tank on small business development. They published a paper earlier this year, the 100-percent exclusion ``boosts the after-tax returns on such investments in startups and should induce substantial levels of new investments in startup firms.'' They further estimate that making this provision permanent would increase risky investments by, conservatively, 50 percent more than the overall cost of the provision. So they are supporting this provision very strongly and would like to see it permanent, but we can only afford in this package to have it for the next year as we again build our way out of this recession.
I guess, from a conservative point of view, one of the good things about this provision--after we vote on the Schumer proposal and the Cantor proposal--it only scores at $4 billion. We get a tremendous benefit for a very small investment of taxpayer money, relatively speaking. Not that $4 billion is chump change, but compared to the $20 billion we are considering for the Schumer package and the $40 billion for the Cantor package, we think we can take that $4 billion and, similar to yeast, make it stretch and grow to affect a lot of people and to spur a lot of investment.
The next provision is the small business tax extenders, the increased deduction for startup expenditures. Again, this has been a Snowe and Merkley initiative. I think Senator Merkley has truly stood up to fight for this.
Under current law, taxpayers can elect to deduct up to $5,000 of startup expenditures in the taxable year in which they start a trade or business. The $5,000 is reduced--but not below zero--by the amount by which the startup costs exceed $50,000.
Examples of potential startup costs: studies of potential markets, products, labor markets or transportation systems; advertisements for the opening of a new business, et cetera; compensation for consultants who help get one's business started.
The Small Business Jobs Act temporarily increased the amount of the startup expenditures entrepreneurs could deduct from their taxes in 2010 from $5,000 to $10,000, with a phaseout threshold of $60,000. Senator Merkley fought to have this provision in the Small Business Jobs Act. This proposal has been repeatedly endorsed by the National Association for the Self-Employed and the National Federation of Independent Businesses.
As part of his ``Startup America'' legislative agenda, President Obama has called for making this permanent. Again, my amendment doesn't make it permanent, but it does make it effective through 2013.
According to a Kauffman Foundation survey, on average, new firms inject about $80,000 into their businesses during the first year of operation. The vast majority of small business owners--between 80 percent and 90 percent--also
invest significant amounts of their own money. I wish to underscore this. The way this amendment came together is we conducted in the Small Business Committee--and had very good turnout--about three or four high-level roundtables, where instead of just having 2 or 3 people testify, we had 20 people at a roundtable show up. For 2 hours, in a very informal setting, they were answering questions, such as: What is the best thing we could do to help you now? What are the barriers to growth? What does a healthy ecosystem for small business look like and what could we do to strengthen and make healthier that ecosystem in America? That is where these ideas came from.
Of course, Senator Merkley picked up on some of this and understood. The Kauffman Foundation was there. They said that even though I have talked a lot on the Senate floor about how small businesses need to borrow money--and many do--when they start a company, they don't want to borrow money unless they absolutely have to because the chances of it not working are pretty significant. Most new startups fail, and so people do not want to go into debt unless they have to or unless they are a little bit more sure their idea is going to work.
The benefit of this proposal is that we are actually rewarding the risk-takers who are digging into their savings and taking second mortgages out on their homes and putting some of their other savings at risk behind their idea. What we are saying is if they do that, we will give a significant tax break, considering it costs about $88,000 to start an average business. So this is targeted to those risk-takers. It is not just taking money out of the Treasury and throwing it at all small businesses. It is taking that money--and this is only $4 billion total--and saying: Ok. Let's target it to those individuals who are putting their lives on the line. They are putting their livelihood on the line and their future on the line. What can we do to support them? I am a very big believer in this provision, and I thank Senator Merkley for bringing it to us.
I see Senator Casey and Senator Shaheen are on the Senate floor to speak and that my time has expired. Since I am going to be on the floor most of the afternoon explaining this amendment, I would be happy to yield the floor.
I see Senator Sessions is here and ask unanimous consent that Senator Casey speak for 10 minutes, Senator Sessions for the next 5 or 10 minutes and Senator Shaheen for 5 minutes.
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Ms. LANDRIEU. Mr. President, I thank my colleague from New Hampshire for not only being such an aggressive and fine and thoughtful member of the Small Business Committee, but for her constant encouragement to me and to Senator Snowe to try to pull together some of the ideas that we all can agree on and move forward.
It may not be the most perfect package, it may not be the most extensive package, but as the Senator from New Hampshire said, it is a package that most all of us can agree to, and it has a pricetag of only $4 billion.
That is a lot of money. But compared to the Republican proposal that has come over here from the House at $40 billion, and the Schumer proposal, which I support because it is much more targeted and much more responsible at $20 billion, this $4 billion amendment could have a tremendous bang, a tremendous leveraging power for its cost. And the two proposals Senator Shaheen explained beautifully actually have zero cost because the 504 program is a program that pays for itself. All we are doing is extending its authorization so people--and there are thousands of them in Louisiana, in Rhode Island, in New Hampshire, and other States--who are caught paying higher interest rates on short-term loans for commercial buildings--and I am sure we all know someone in that category--can now, if this amendment passes, go to their local bank--it is not a government program; it is a partnership with the local banks and through the SBA--and refinance their building and get a longer term loan.
In fact, I am told that this program, this 504 program, is basically taking up the majority of the space in this lending, that still the lenders are very weak. They are not extending credit out in a long fixed rate. They are lending short term. They are lending with adjustable rates. As the Presiding Officer knows, and many others, when a person is starting a small business and taking so much risk, one risk that can be eliminated is the cost of their money. It is very comforting to a small business owner--who has to borrow, who does not have the savings or has run through their savings or the equity in their home and they have to extend and take that risk--to be able to have a fixed, longer term rate.
So again, this proposal came from Senator Isakson, who truly is acknowledged as the expert in this entire Chamber on commercial real estate and on residential real estate. He is known and respected on both sides of the aisle. This is his proposal with Senator Shaheen. I thank him for his leadership.
Also, the Senator spoke about the export coordination. Again: zero cost; just smarter government, at no cost. We need more of that around here: smarter government, less spending. That is what Senator Shaheen's proposal does, which is a portion of this amendment, the Small Business Export Growth Act.
Let me reiterate that 95 percent of the world's customers are located outside of the borders of the United States. It might be shocking to people in America to realize this, but we represent only 4 to 5 percent of the population of the Earth. We think of ourselves as the biggest and the best, and we are the best. We are not necessarily the biggest when it comes to population, though.
So there are growing markets all over the world. Mr. President, 95 percent of our customers and a majority of the market are outside of the boundaries of the United States. What we are recognizing is, right now only 1 percent of the 28 million small businesses in America export. Why would that be? One, it can be intimidating for a small business, even though they have a great product, they have a great idea, they have great technology. And India needs that technology or some countries in Africa might absolutely want that product or that service. The small businesses are intimidated. They do not have the accountants, they do not normally have access to high-powered, expensive lawyers and trade executives and experts. So that is what our government--and, frankly, State governments are doing this. Smart governments at the State level--whether it is California, Oregon, Louisiana--all States are now recognizing: Gee, we need to get behind our small businesses in our State and help them to export.
I was very proud to put a substantial investment in the jobs act of 2010, which gave competitive grants to States. And it is remarkable; just a little bit of investment at the Federal level is leveraging a tremendous amount of excitement at the State and local level as those governments accept those grants and then put them to work.
In Louisiana, our department of economic development has been very aggressive in using its step grants. So, again, this is not an additional grant program. This Shaheen-Ayotte proposal has no cost. It is perfecting, coordinating this export initiative by establishing an interagency task force between the SBA, the USDA, and the Ex-Im Bank. It is really encouraging cooperation that now does not exist at the Federal level and requires the SBA, in coordination with other agencies, to conduct one outreach event in each State per year, which I think would really help to motivate our State governments and our stakeholders at the State level to be helpful.
Let me go back to the beginning. We have the SUCCESS Act amendment. I talked earlier about 16 provisions in this amendment. We talked about the 100-percent exclusion of capital gains. We have talked about the increased deduction for startup expenditures, which is Senator Merkley's provisions.
Now I want to talk about the S corp holding period. This has come out of the Finance Committee. Senator Snowe and Senator Cardin have been very strong advocates of this provision. Under current law, when a corporation becomes an S corporation--and there are, of course, benefits to becoming that kind of corporation--right now it is required to hold its business assets for 10 years or pay punitive taxes. In our mind, this 10-year holding period is too long. It ties up assets that could be sold to raise capital. In 2010, in our small business bill, we reduced this holding period to 5 years so businesses would be better able to manage their planning cycles. So this proposal is to extend the 5-year holding period through 2012 and 2013. You know, potentially, if we could afford it, we would like to make this proposal permanent, but in the Landrieu SUCCESS Act amendment, it would extend it through 2012 and 2013 and has a minimal cost.
The next provision is a carryback provision--up to 5 years of general business credits. This is a proposal about which Senator Snowe feels very strongly. The proposal would extend the carryback period from 1 year to 5 years for general business credits earned in 2012 and 2013. It would provide tax refunds to businesses that were previously healthy but are currently running losses.
The proposal would improve the effectiveness of business credits that are intended to expand investment and employment. The provision would allow businesses greater immediate benefit from credits designed to encourage specific types of activity. By providing businesses with greater opportunity to claim business credits, the provision would also give an infusion of cash to businesses, which might promote investment. So that is another provision of our SUCCESS Act.
Section 179 is probably the most popular part of our amendment and, again, Senator Snowe has championed this in the Finance Committee. Many Finance Committee members are completely aware of section 179 in the Tax Code, which deals with expensing that many restaurants and retailers use. Basically, it provides a credit for them if a small business buys machinery and equipment or property contained in or attached to a building other than structural components, such as refrigerators, grocery store counters, office equipment, gasoline storage tanks, pumps at retail service stations, even livestock, including horses, cattle, sheep, and goats, other fur-bearing animals--all of the equipment or products or purchases small businesses make to run their businesses. This would allow an immediate writeoff of up to $500,000 for this kind of property. So, again, it is $2.3 billion over 10 years. It is the most expensive part of this whole amendment, but we think it is $2 billion well invested to encourage those small businesses to make these investments now, to get jobs and expansion opportunities underway.
Twenty-six national business groups, such as the NFIB, the U.S. Chamber of Commerce, the National Association of Home Builders, and the National Association for the Self-Employed, have endorsed this and have sent a letter to us with very enthusiastic support.
The next section is expanding access to capital for entrepreneurs. This was actually mentioned in President Obama's State of the Union Message to us when he talked about his small business proposals. He outlined maybe half a dozen things, a few of which we have implemented and a few of which we have not yet implemented. This was on his bucket list, if you will. And I am a strong proponent of this provision.
We created a small business investment company in a bipartisan way decades ago. It has been one of the most successful programs created to spur business development in the country. It basically operates on a sustainable level and does not cost the Federal Government anything. It is like venture capital--not really like venture capital--it is like an investment; not a bank but a nonbank investment company that was created many years before I became chair of this committee. It is something that was done through Democratic and Republicans administrations because it worked.
All this does is raise the statutory cap from $3 billion to $4 billion, and it increases the amount of leverage of licensees from $225 million to $350 million. They are bumping up against that $3 billion cap. It has been very successful. We would like to take it to the next level. And, of course, some of the most successful funds within SBIC are bumping up against their $225 million cap per fund. So this is one of the great ideas that came out of our roundtable. Again, not only does President Obama support it, it has my strong support and Senator Snowe's, the ranking member of the Small Business Committee.
The next provision would be the SBA 504 refinance. This extends for a year and a half the ability of the SBA 504 Loan Program. We talked about this. Senator Shaheen spoke about this, and I have already explained it. So this is really the Isakson-Shaheen-Snowe proposal.
The next is the small business lending activity index. This is something I have put forward. We have talked with the banks and the SBA. They are all on board and accepting of this concept. It is a way to measure the small business lending activity that is being done at the city-State level through the 7(a) and 504 Lending Program.
It was very curious to me, when I became chair of this committee, that we did not have the measurements in place to actually judge whether some of our programs were really working. Were they working really well or working moderately or were they very weak? So I have instructed my staff and we have been working together to see in every way if we measure and really record the activities of the Small Business Administration. It is only a $1 billion agency, one of the smaller agencies of the government, but that billion dollars comes from taxpayers and we want to make sure that money is spent well and wisely.
So this legislation, again, is at no cost. It can be done within the current budget. It will be called the lender activity index. It will be posted on the SBA Web site. It will have the name of the bank, the number of SBA loans made by each bank, the total dollar amount of SBA loans, the ZIP Code of bank activity, the industries lent to, so we can sort of see how our banks are lending and to what areas, the stage of the business cycle, and then whether it was a woman-owned, minority-owned, or veteran-owned business, if that information can be obtained. It is very simple. We made sure the language is easy for the banks. They already have to report this data; it is just not in a useable format. This will require them to put it in a useable format.
The next is access to global markets. This is what Senator Shaheen spoke about. So the major part of this bill is tax cuts to businesses and then some oversight of the SBA, tightening up, coordinating our export strategy. And then the next and final part of this--or next to last part of our amendment is basically access to mentoring, education, strategic partnership.
In our roundtable--I am not going to go into all of the details of these items, but the bottom line is that in our roundtable, experts--business owners and the Kauffman Foundation and others--came to us and said: Senator, you are right, businesses need capital. You are right, we need access to global markets. You are right that we need a fair tax code. But what businesses also need is technical advice and support and training, and we need more education, entrepreneurship education.
The Small Business Administration is not the education agency, so we have been very careful not to mission creep. We have designed a couple of proposals that can encourage better activity within the SBA to form partnerships with nonprofits and even for-profits, not-for-profits, and schools to promote entrepreneurship appropriately. The Federal Government can be a model. It is only one model. But we believe technical training is important. We have partners already established--the women's small business centers and minority business centers. Getting them to be more effective and providing additional counseling is very important.
Finally on this amendment, access to government contracting is another method for small businesses to be able to grow. Governments--whether it is Federal, State, or local--are huge purchasers of goods and services, and if our contracting laws are right and if they are enforced, then small businesses in America will have an opportunity to get started by competing for government contracts or to grow by receiving government contracts. And they are more likely to grow. If a big business gets a contract from the government, they can sometimes absorb that contact and make their company more efficient, giving more work to the people who are already there. And there is nothing wrong with that; that is business. But when a small business gets a government contract, most of the time it results in additional hiring because small businesses have to be lean and agile. So they might have five people but they have a lot of expertise. They land a contract from the government that they are most certainly qualified to do, and then they have to hire. So they have to hire 10 people to carry out that contract, which is why I have been very supportive--Senator Cardin has been a champion on this issue and Senator Levin as well--of giving small businesses an opportunity for contracting. That will really help.
In conclusion on this amendment--I see other Members coming to the floor. I wish to speak for another 5 or so minutes. I came to the floor today to support the underlying bill, which is the Schumer tax cut provision that is targeted tax relief to small businesses in America. I hope our Members will support that.
If for any reason they don't support that, or even if we do, we will still have an opportunity, I hope, to vote on the Landrieu amendment. I say that humbly because this amendment has been put together by Senator Snowe and her staff with me and members of the Small Business Committee on both sides of the aisle. We picked up some great ideas from individual legislation that had been filed, and it got unanimous consent and review, talking to many people.
So we don't believe it is controversial. We know it doesn't cost that much--$4 billion--and we believe it will have a tremendous and immediate impact on small businesses in America.
I wanted to give that explanation. We have received a tremendous amount of support today from a variety of organizations.
I see my colleague on the floor. I will yield the floor at this time and perhaps will take a few more minutes before 6 o'clock.
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Ms. LANDRIEU. Mr. President, there are a few other things I would like to say.
I wanted to take a minute to respond to something that Senator Rubio said earlier, and Senator Sessions, while I was on the floor. I have great respect for those two Members, but he came to the floor with a fairly critical diatribe, if you will, against some of President Obama's policies. I have not been a great supporter of the President's energy policies, and I actually appreciate some of the views Senator Rubio holds about the fact that we need to drill more in this country.
I want to show something I think Florida should be mindful of and suggest that the Senator from Florida could start making that speech at home in Florida because Florida is one of the States that virtually produces no energy, from any source. It has been a bone of contention with me for many years that we have had Senators come to the floor and talk about what so-and-so doesn't do and what so-and-so doesn't do.
I want to remind the Senator from Florida that the gas that keeps the lights on in Florida actually comes from the Mobile Bay. These are the pipelines that Mississippi and Alabama and Texas--9,000 miles of pipelines and drilling--have off of our shore and onshore to provide gas and lights to Florida.
This is a chart that is very interesting. Before America can be energy independent or energy secure, each State should be energy secure, or each region. The country is not made up of smoke and mirrors; it is made up of 50 States. If every State and every region would do its part, either producing or conserving or a little of both, we could actually get there. But I get a little tired of the lectures criticizing us--particularly from States that neither conserve nor produce.
California gets a little bit of a break, even though they consume more energy than any State. They are a net consumer of energy. We are down here, a net producer. The States that produce more energy than they consume are Wyoming, West Virginia, Louisiana, New Mexico, Alaska, Kentucky--and North Dakota should be on here now because this was some years ago. Probably Montana also would be on here now.
The Senator from Florida is coming and lecturing everybody about producing, and his own State produces virtually nothing and consumes everything. I wanted to say that I find that offensive. California gets a little bit of a pass from me because if we look at another chart, they do more to sort of consume energy through government regulations, which I know the other side doesn't like. They think we don't need any regulations, and that is their view. California has a lot of regulations--maybe too much for me as well--but they are doing a lot to conserve. Florida doesn't. Maybe if Florida started doing a little drilling, it would help the United States to be more energy independent.
My second point: I want to answer something Senator Sessions said. I will try to find my document on that in a minute. Senator Sessions came to the floor a few minutes ago and talked about the cost of the health care bill. The health care bill has some expensive components to it. The purpose of the health care bill, remember, Mr. President--because the occupant of the chair was in the middle of that battle--was designed to reduce the overall cost of health care for the Nation because the percentage of the gross national product going to health care was moving up dramatically and frighteningly--from 12 percent a few years ago to 14 percent, to 16 percent, and it was on its way to 19 percent. It was on its way to 19 percent before Barack Obama got sworn into office.
I am getting tired--and the American people are getting tired--of the same diatribe coming from the other side of the aisle about how the cost of the Affordable Care Act is causing the country to go off the edge. This country was going off the edge before President Obama even became President. They know that. But they are just bound and determined to keep talking about the same old thing day in and day out, about how the Affordable Care Act is wrecking America. The only thing wrecking America is their stubbornness.
I want to put this into the Record. When President Clinton was President, as you know, it was the last time we had a surplus. It was the Republican President and the Republican leadership that turned that surplus into a
deficit. The ship had already hit the iceberg before President Obama took his oath of office. Now they want to blame the entire deficit on the Affordable Care Act.
When the Affordable Care Act is implemented--now that the Supreme Court has said it is most certainly constitutional--instead of fighting it every step of the way, it would, in the long run, save money.
They want to talk about this tax, tax, tax, tax. I want
to call what they do the ``no care tax,'' because that is the Republican position. Before there was the Affordable Care Act, people in America were losing care rapidly. Small businesses were dropping their insurance. They could not afford it anymore. These premiums have been going up for a long time. The Affordable Care Act didn't drive the premiums up; they were going through the ceiling. We had to do something to try to stop it.
When President Obama came into office, and we saw that the trends were going up, in our efforts to try to get the budget back into balance it was obvious that we had to do something with health care. But they keep talking about tax, tax, tax. I remind them that before we passed the Affordable Care Act, there was a tax on every insurance policy that people in America had because it was a tax for the uninsured. It was about $1,200. That tax was on the backs of the American people before President Obama ever became President, before we even began debating the Affordable Care Act.
The other cost that was going on in this country was the people who didn't have Medicare, who didn't have Medicaid, and didn't have insurance--and it was a rising number of people without insurance. And as States cut back on their Medicaid, a rising number of people who didn't have Medicaid went to our hospitals, our private hospitals, our public hospitals, and our not-for-profit hospitals. Do you know what the Republicans want to tell them. Just treat those people for free. There is no one to reimburse you for this cost. Medicaid will not reimburse them because they are not 65. They don't have private insurance. And the Governors cut back on Medicaid because they can't bear to go look for some tax loopholes that people might not need in order to provide working Americans with health care.
They are too busy campaigning for their next election, so they told all the hospitals: You all go ahead and take care of these people for free. So when a non-paying customer went to a hospital, whom do you think picked up the tab for that? The paying customer.
So before President Obama became the President, before we started trying to figure out a way out of this terrible mess, there was a huge tax on the backs of the American people and a huge debt having to be paid every year by every hospital in America. Why don't they talk about that? They don't.
I hope the American people will listen because I am so tired of that same old speech. I have heard it for 3 years--before the debate, during the debate, and I guess we are going to hear it up to the election. I hope the American people will listen. Don't let them talk about the tax that is supposedly in this bill. The Affordable Care Act is alleviating a tax burden. It alleviates a terrible tax burden, an invisible tax that has been on the American people, and a heavy burden on the backs of the taxpayers--and immoral in some ways, as well--with working Americans working 50, 60 hours a week, and when they get sick, they have nowhere to turn.
Instead of putting their proposals on the table, they decided they wanted to block and tackle and stop and not contribute anything. I think the country will make a good decision. I think the country likes the fact that their kids can stay on their health care plan until they are 26, and they like the fact that when they get sick with cancer or diabetes they cannot be kicked off their health insurance. Particularly businesses would like it if the States would step up and cover some of these lower wage workers, and the burden would not fall on us.
For every Governor--and mine may be one--who rejects the expansion of Medicare, who do they think has to pick this up? It is the small businesses.
The burden should be shared for our lower income workers broadly, not on the backs of businesses that are struggling. That is the way we designed this program. The Federal Government said: We know it is tough. We know it is an expansion. Do you know what. We will pick up the 3 years 100 percent to give you some time, to help you so you can look at your Tax Code, and you might be able to find out and let me get this one more thing off my chest. Who made up the rule that the Federal Government is in charge of the health of every American citizen? Do Governors have any responsibility for health? Are we supposed to just do everything up here? Do mayors and Governors have any responsibility for the health and welfare of the people they serve? I suggest the Governors--some of them--get off the campaign trail, get back to their offices, and start putting health care legislation together--particularly some of the Republican Governors.
I am glad I said that. I am happy to turn over the microphone. I suggest the absence of a quorum.
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