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Public Statements

Middle Class Tax Cut--Motion to Proceed

Floor Speech

By:
Date:
Location: Washington, DC

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Mr. COATS. Mr. President, I wish to talk about two things here briefly and also yield to my colleague for some remarks. First of all, while it is beyond our jurisdiction here, and perhaps it is a little bit out of line for me to talk about this, I am urging the Congress, specifically in this case the House of Representatives, to follow this body in passing the farm bill.

I do so for a number of reasons. Even though I had some problems with the farm bill, and I fully understand the issue, there are those who believe those policies that directly affect agriculture are being subordinated to a bill which incorporates about 80 percent of that bill for Federal food assistance. These are nutrition issues which, of course, are related to agriculture.

By the same token, it is a Federal program that is significantly different than what the farm bill is designed to accomplish. So about 20 percent of that bill affects the farmers in our area, the other 80 percent goes to a Federal welfare type of program for providing food stamps and other nutrition assistance.

I am hoping that the House, particularly in light of the fact we are suffering a significant drought, probably the worst drought since 1950 according to the weather records, and getting worse all the time--the temperatures have been in the low hundreds all across the Midwest, the bread basket of America, where we produce most of our grain and feedstock.

The cornfields and soybean fields and other pastures are burning up with blazing sun in the hundreds of degrees every day and no water falling from the sky. This drought is seriously impacting my State, but also a number of Midwestern States and especially the States that produce the bulk of our agricultural products. This affects not only needed crops to provide feedstock, but also that support our ethanol program and a number of other programs. It is a dire situation.

I am hoping the House can resolve its issues and move forward. There are a number of provisions in this farm bill that provide relief to farmers and ranchers suffering from this drought. Those are expired. So it is important that

we pass this bill, that we get it passed by both Houses of Congress and into conference, resolved and signed by the President.

I am urging my colleagues in the House, where I once served, to help with this by moving forward on this farm bill.

The other point I want to make is that we are about to face--we just learned from our leadership, we are about to enter into a short amount of debate before we vote on a motion to address taxes. This also directly affects our agriculture community and we will explain why. But I wish to yield to my colleague here from Mississippi for some comments in this regard.

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Mr. COATS. I thank my colleagues for joining in on this. They made the point that I think outlines the fact that many of us are stunned with the proposal being brought forward for a vote today to proceed on this bill, which if passed, will put a 55-percent tax, when one dies, on all the work and all the profits and all of the investments they have made throughout their lifetime, which they have paid taxes on over and over and over. The government cannot ever seem to get enough. The Senate Democrats are now proposing to raise the death tax from 35 percent, the current level, to 55 percent.

Let me personalize this for a moment. We have some very close friends who, throughout generations, have been handing the farm down from one generation to another. They have suffered through the hard times, the droughts, the hail storms, the tornadoes, and they have also benefited from the good times when the rains have come and the soil was good and the yield was good. Yet right now they are suffering in a way they have not in more than a half century with this drought that is unrelenting all across the Midwest in this country. It takes in almost the entire Farm Belt of the Midwest and Upper Midwest, where most of our grain and products are grown.

At a time like this, to bring forth a piece of legislation that basically says not only are you being nailed by the weather--and we, obviously, cannot do anything about that except provide some basic form of financial relief to get through this particular time; and that is what I talked about earlier--but we are going to nail you with a tax that, when you die, will basically prevent you from passing on your business or your farm to the next generation.

As I said, to personalize it, we have some dear friends--more than one couple. I have also talked to people throughout Indiana where the pride in holding their ground as part of their extended family, covering more than one and two generations, and the work they have put in, in order to preserve that hand-down to their children and to their grandchildren now goes up in flames because when they die, if their farm is valued at more than $1 million, they are imposed with a 55-percent tax on the value of everything over $1 million.

People say they are millionaires. No, they are not. They are sitting on property that might be valued at that, but they might be losing money. For sure, this year, they are not going to make any money because they have had to plow their corn under because it hasn't gotten the rain and moisture it needs and it will not grow. We don't yet know the extent of this disaster, but to preserve that within the families and hope for better years to come, that will not happen because, as the Senator from South Dakota said, they are going to have to value their land--the IRS will value their land at a price that the only way they can pay for that is to sell their assets.

Why in the world would they do that at a time of economic turmoil and cause a drift back essentially into recession? This country is not in good economic shape. Compared to Europe, we are in better shape, but if you look at the numbers, they are not trending the right way. Why at a time like this would you walk onto the floor of the United States Senate and put up a bill that will raise taxes on people who are already suffering from 35 percent to 55 percent? How high does it have to go? How many taxes have to be imposed on the American people before they say that is enough? They are saying: Clean up your spending process in Washington so we don't have to pay so much in taxes to cover all you are doing there.

My colleagues would like to continue to respond. I want to turn to my colleague

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Mr. COATS. Mr. President, I now turn to my colleague from Kansas, and I tell him about one of the families very close to us--my wife grew up with her lifetime friend, who married a farm boy from Kansas. They ran a farm near Norton, KS. We speak with them regularly. Even though we are city people, we have learned from them the sacrifice that goes into maintaining a farm, the suffering that occurs

from the whims of the weather, the prices of the crops. We see them struggle and struggle, and this obviously will not be a good year. But this is a farm that has been passed down to the third generation now. They own a lot of land.

As the Senator knows, Kansas has a lot of land. And they didn't get the rainfall we did. I know this is a situation that ends the dream that has been passed down from generation to generation because on the death of the current owners of the farm, the tax on that would force them to sell their land.

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Mr. COATS. Mr. President, whether it is the family my wife grew up with and knew or the one in Posey County, IN, who brought their neighbors together for a meeting a few months ago or whether it is a family or business owner or small businesses across the State of Indiana that I have talked to repeatedly, they basically say: I resent being called rich by the President, who said they need to pay more in taxes.

We have been working our tails off for generations, and we have been paying our taxes faithfully for the profits we made--the years we have made profits. Yet we are being classified as some type of an elite group that is not paying their fair share. We can look back and we read statistics, such as 47 percent of Americans aren't paying any income taxes, while we are out there creating jobs, building a business--with sometimes good years, sometimes bad years--over a lifetime. There is value added to that business, but that value is in machines, it is in buildings and land, in terms of farmers. Yet that gets evaluated when we die at a level which means we can't pass it on. We can't afford to pass it on to other generations and we have to sell it. The Federal Government, having taxed us all our life on the profits we have made--the income taxes, the Social Security contributions, the Medicare contributions, the sales taxes, the personal property taxes, the car taxes, the boat taxes, if one has a boat, the excise taxes, the liquor taxes, the beer tax, the sales tax and on and on and on it goes--it is not just the income tax we are being taxed on. There is not a tax that government doesn't like or want to impose on the American people.

Why would anyone, of either party, at a time of economic distress--when the United States is the only country struggling to stay ahead and perhaps lead the world back into economic growth, at a time when we are seeing signs of a potential double-dip recession facing us, and the news in the last few days has been dramatically bad--want to bring a bill to the floor of the Senate that says you are not paying enough if you own a small business or if you own a farm. You are not paying enough, so we think 55 percent is a fair rate--55 percent if you die, after you have paid taxes all your life to a Federal Government which is bloated and duplicative.

The bureaucracy here is out of control. Congress hasn't lived up to its responsibility to take any kind of sensible fiscal measures that will get us back on track in terms of battling our budget and not spending more than we take in. Throughout all the efforts that have taken place throughout 2011, and some in 2012, we still have not come up with a program, with a budget arrangement which will put us on the path to fiscal health. Yet what is the response from the other side? The response is: Let's impose another tax. So at 4 o'clock today, Members are going to come down and vote in terms of whether they want to impose a 55-percent death tax on people who are already being taxed to death.

I will yield the floor, but then I am sure my colleagues will want to ask for their own recognition.

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