BREAK IN TRANSCRIPT
Mr. CORNYN. Mr. President, I am still trying to wrap my head around President Obama's recent remarks that small business job creators somehow owe their success to the Federal Government. His comment wasn't just wrong, it was actually kind of embarrassing. It showed that the President does not understand the enormous challenges and financial risks entrepreneurs and job creators deal with every day. It also affirmed that the President is going to continue pushing the same misguided big-government economic policies that have helped keep our unemployment rate well above 8 percent for some 41 consecutive months.
I wish to highlight a few of the success stories from my home State of Texas that epitomize what the American dream is all about and to reassure my listeners that the American dream is still alive and well and thriving in the great State of Texas. But first I would like to make a brief point about tax policy because as mundane and boring as tax policy may seem to a lot of people, it actually has a very real impact on the people I am talking about.
There is now an emerging bipartisan consensus that tax reform should involve lowering rates and broadening the base so that our tax system becomes simpler, fairer, and more conducive to strong economic growth. Don't just take my word for it. Look at the President's own bipartisan fiscal commission, the Simpson-Bowles Commission, which reached that same conclusion.
Unfortunately, the President's own fiscal commission's report is inconsistent with the President's current demand that we have to raise taxes. That would mean a large tax increase for many people who are the people we are depending upon to create those jobs. The reason is that many small businesses pay their business income on individual tax returns. They are not major Forbes 500, multinational corporations; they are the mom-and-pop operations that are sole proprietorships, they are partnerships, and they are even sometimes subchapter S corporations. That is just a reference to the Tax Code that means you don't pay corporate taxes, you pay flowthrough business income on your individual tax return. So many people who are small businesses who may reach that threshold of $250,000 or above are businesspeople paying on an individual tax return. If this is an effort to soak the rich, well, the middle class and small businesses are part of the collateral damage.
I would like to remind the President that Americans will spend about $350 billion this year alone just to comply with the Tax Code. That means hiring accountants and that means hiring lawyers just to try to figure out what they owe to the Federal Government. Small business owners face a particularly heavy burden because they can't afford the army of lawyers and accountants to help them figure out what their tax obligations are. Yet these are the folks we are depending upon to get America back to work and to get our economy growing again. But we effectively have a tax system that punishes them for their success. We can and we should do better.
When it comes to dealing with the IRS, small businesses don't enjoy the same resources that large multinational corporations do. According to the World Bank, it is now more difficult to pay business taxes in the United States than in many Western European countries. When heavily taxed, heavily bureaucratic countries such as France make it easier to comply with their tax code than America does, we know we have a problem.
If the President doesn't believe me, perhaps he should spend some time chatting with some of my constituents, people such as Steve Mayo, the owner of Mayo Furniture in Texarkana, TX. Steve's company is a family business that was established about a half century ago. It now employs 130 full-time workers and sells furniture in 25 different States. When I visited with Steve and his employees last year, they were worried about how in the world they were going to comply with the financial burdens of the new health care law, along with other taxes and regulations. They told me it would affect their business and their ability to create jobs and stay competitive. These are the same concerns I have heard about from countless constituents and small business owners all across my State.
We are one of the lucky States. About half the jobs in America have been created in my State in the last 5 years or so. We are fortunate because when it comes to small businesses we are depending upon to create jobs, we asked this very simple question: How can we make it easier for them to create jobs? How can we make it easier for them to start a business? Unfortunately, the message emanating from Washington seems to be--in so many words--how can we make it harder? How can we increase the unpredictability of their investment?
After talking to Steve Mayo, maybe President Obama would like to talk to Diane LaBleu. Diane is a breast cancer survivor in Austin, TX. Diane was creative enough to invent a clothing accessory to help women recovering from a mastectomy. The accessory is known as a Pink Pocket, and it is now being used by women around the world from Austin to Australia.
The story of Pink Pockets demonstrates the power of a great idea. Diane identified a problem facing breast cancer survivors. She came up with a brilliant solution, something nobody else had thought of before. The remarkable success of her invention is a testament to her creativity and her hard work.
The government was not responsible for the success of Pink Pockets or Mayo Furniture. Far from it. Many times all these small businesses want is for government to get out of their way, off their back, and out of their
pocket so they can do what they do best.
The government was also not responsible for the success of STS Coatings, a construction company based in the San Antonio area. The founder of STS Coatings, Cayce Kovacs, reports that she and her husband cashed in their savings to launch their business, which now has annual sales totaling more than $3 million. As Ms. Kovacs recently said:
We were the ones sweating bullets over processing orders and paying our bills, making payroll--not the government. The government did nothing to help my business.
You know who else can say that? Another extraordinary Texan named Frank Scantlin, who founded Sunbelt Machine Works in Stafford, TX, near Houston, some 34 years ago. Frank tells a story that as a child he was so poor he sometimes couldn't even afford to buy shoes, and he had to quit school in the ninth grade in order to support his family. This is a quintessential American success story. Frank persevered and went on to create a business that now has almost 60,000 square feet of workspace and employs 90 people.
All these stories epitomize the American dream that has enticed immigrants from around the world to take a risk, leave everything they had behind, and come and make America their home. We were the one place in the world where they knew if they were willing to work hard and save, that hard work could be rewarded by success.
In the meantime, those of us who depend on those small businesses to create those jobs and prosperity could benefit as well. The owners of Sunbelt, STS Coatings, Pink Pockets, and Mayo Furniture understand their success was not inevitable, and it sure was not guaranteed by the Federal Government. They had to take the hard risks, they had to work overtime, and they had to overcome challenges that many times the government put in their way. In the end, as in so many great American success stories, their hard work and ingenuity paid off. They can, not government, declare with confidence that ``I built this.''
My office has received more than 250 of these stories since President Obama gave his speech in Roanoke. They are the type of stories that have made our country the beacon of prosperity and entrepreneurial energy for so many years. As one Texas business owner put it: ``Rugged individualism is alive and well in the United States.'' I hope we remember that, and I hope the President of the United States remembers that as well.
I yield the floor and note the absence of a quorum.
BREAK IN TRANSCRIPT