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Mr. NELSON of Florida. Mr. President, in the midst of all of this tax debate and the partisan wrangling and the gridlock that has ensued--and today we will have another couple of tax votes, and, again, real progress will be stalled--I would like to offer a bipartisan thought that will lead to a solution. As a matter of fact, I think there are over 50 Senators of the 100-Senator body who agree that deficit reduction can be done, and done in a comprehensive way. I think partisan politics, all mixed up in election-year politics of a Presidential election, is getting in the way, and I think that is what we are going to see being played out this afternoon on the floor of the Senate.
What would that solution be? Well, if our target is that we want to reduce the deficit over a 10-year period by at least $4 trillion--that was clearly where the Simpson-Bowles Commission was going; that was clearly where the Gang of 6, which morphed into 45 of us who last summer stood and had a press conference and talked about $4 trillion-plus in deficit reduction, was going--if that is what our goal is, and as others have spoken out here, if we could get that kind of deficit reduction agreement for a 10-year period, what we would have is a shot of confidence into the economy, and we would see this economic engine start to roar more to life, other than the gradual economic recovery we are seeing--indeed, a recovery of 27 straight months of private sector job growth, but albeit a slow economic recovery.
If over 50 of us were to come together and strike that agreement, indeed, that is what we would have, and the stock market would take off, the bank lending would take off, the credit ratings would go up, and all of the incidental things that would flow from that.
You know what. At the end of the year that is what we are going to have to do, and most every reasonable Senator knows that. That is why there are a number of Senators on this side and that side of the aisle who have spoken the same message.
What is that message?
No. 1, that we have to have some spending cuts, but if we are doing $4 trillion-plus, we cannot do it all with spending cuts. We have to have revenue produced.
How do we get the revenue? What over 50 Senators in this body would agree to is we reform the Tax Code in a comprehensive way by starting to eliminate some of the tax preferences, otherwise known as tax loopholes, tax deductions, tax credits, that have ballooned out of control.
The last time I voted for tax reform I was a young Congressman and President Reagan was President. It was 1986. When we reformed the Tax Code back then, the tax expenditures for a 10-year period were worth about $2 trillion to $3 trillion. Do you know, that has ballooned now to over $14 trillion over a 10-year period, just in tax preferences--that is individual tax preference items for different special interests--which means revenue is not coming in. As a matter of fact, there is more going out in tax preferences than there actually is coming in each year in individual income tax.
Well, if we reform it in the way that a lot of us are talking about, then we take that revenue and we do two things with it: No. 1, we simplify the Tax Code and we lower everybody's tax rates--individual income tax rates, as well as corporate income tax rates--and we take the rest of the revenue and pay down the annual deficit.
Now, that is fairly common sense, and it is fairly simple. Of course, to get in and comprehensively reform the Tax Code is going to be quite a task, and the committee that is designated to make the first cut at it would be the Finance Committee, of which I have the privilege of being a member.
We have heard similar statements by a number of Republican Senators. We will continue to hear statements from other Democrats--such as me--about what I just said. And we will hear that because the commonsense people know that is what it is going to take to get our budgetary house in order.
But we are not there. We are in the middle of a partisan war, all wound up in the crucible of an election year for President, and as a result we are going to have two tax votes today that do not pass.
The Republican version of the tax cut is going to be all of the Bush tax cuts from 2001 and 2003. They stay in effect for all levels of income. Oh, by the way, in their bill, they say to make up for that $405 billion that will not go into the Treasury as a result of the continuation of the Bush tax cuts--in 1 year, $405 billion--we cannot do anything with revenue. So they are going to prohibit what half of the Senate knows ultimately is the solution to this problem. That is one version.
The other version is what is being brought forth by the majority leader, which is, give the tax cuts for everybody, including the top 2 percent. But the top 2 percent--above $250,000 adjusted gross income on a joint return--that tax rate will go up a little over 4 percent just on the income above the $250,000 adjusted gross income, not on the income underneath, for which everybody continues to have the continued tax rate. In that same proposal, 97 percent of the small businesses will not get any kind of tax increase. Likewise, if they are a subchapter S corporation, they will have the same benefits of the tax cut up to that level of $250,000.
We heard comment out here about, oh, we have to keep the exemptions on the estate tax up, which I certainly agree with. Well, in this version the majority leader is going to offer, it has no provisions in it on raising the estate tax.
What would be my preference? I am going to vote for the majority leader's proposal, but my preference is that we would take that tax cut up to the level of adjusted gross income of $1 million on a joint return, which would mean far less than 1 percent of the people in this country would be affected by a 4-percent increase in that income above $1 million.
That is my preference. That is what I voted on a year ago. But that is not the choice before us today. So I have no choice but to vote as I just indicated. But at the end of the day, this is not going to solve the problem. It is going to be more political posturing all the way up to the November election. Then in a lameduck session we are going to get down to work. We are going to let common sense and bipartisanship operate, and we are going to solve this deficit problem.
Mr. President, I yield the floor.
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