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Mr. HATCH. Madam President, I wish to thank my colleague, who makes a lot of very important points here today, and I hope everyone in this body is paying attention.
Back in June I came to the floor to discuss the many items of unfinished business the Congress must take up before the end of the year. Among those items are a number of tax-related issues that simply cannot be put off without inflicting more damage on our economy and on our American taxpayers.
When I spoke on the floor regarding this tax agenda 3 months ago, I used this chart right here.
Sadly, as you can see from this chart, things have not changed since then. We still need to resolve the death tax. As you can see, death tax relief is the third one down listed on the chart. It will expire at the end of 2012. We need to act in order to prevent a hike in the death tax in 2013. Unfortunately, rather than work to prevent an increase in the death tax, a number of my colleagues voted earlier this summer to expand it significantly.
While we have passed a bill through the Finance Committee, the Senate has yet to act on the tax extenders, which expired 9 months ago. As you can see, we have not done the tax extenders, either, on the floor.
We still have not acted to address the alternative minimum tax, or AMT, which is set to hit millions of Americans if we do not act to patch it. That is right there as the second item on this chart. This issue of the AMT, the alternative minimum tax, needs to be discussed in some detail because the failure to resolve the AMT is emblematic of the failure of this administration to take even the most basic steps to protect American families from the tax increases looming at the end of this year. Nearly 4 million families paid the AMT in 2011. Yet, if nothing is done to address the AMT in this session, an additional 27 to 28 million families will be hit with a surprise AMT tax increase on tax day next April. Now, that bears repeating. There are 27 or 28 million families who have heretofore not been hit by the AMT who will be hit if Congress fails to act before the end of this year. But even that does not tell the whole story. More than twice that number, that is, 60 million American families, will have to fill out the AMT--alternative minimum tax--worksheet on their tax forms just to determine whether they owe anything under the AMT. This is a textbook example of the administrative burden and deadweight loss that our complicated Tax Code imposes on the American economy. For those who will be hit by the AMT, this is not just a reality that will hit on April 15 of next year, it is a reality today. Those families ensnared by the AMT are required to make estimated tax payments, and Monday of next week, September 17, the third such payment is due.
The AMT has become a unique burden because of the way it is structured. Unlike most provisions in the Tax Code, the level of income exempt from the AMT is not automatically adjusted for inflation. For 11 years, we have passed legislation to temporarily raise the AMT exemption, which was originally meant for only 155 millionaires who did not pay any taxes. But each time we face an expiration of one of these temporary raises--like we do again this year--we risk seeing the AMT return to its permanent level. Over time, that becomes more and more problematic as more and more Americans have incomes that reach the unadjusted AMT income level. These temporary exemption increases have been enacted to prevent millions of middle-class American families from falling prey to the AMT. But now, the closer we get to the end of 2012 without another AMT patch, the more likely it becomes that the tax will hit an unprecedented number of American families.
Ultimately, we need a permanent fix for the AMT. This annual shell game needs to come to an end. This tax was initially created over 50 years ago to address 155 high-income individuals who paid zero in income taxes--155 people. Because of its poor design, today an additional 27 million Americans, many squarely in the middle class, are now threatened by the AMT.
The President and his allies assure us that AMT relief is a top priority, but that seems to be just more talk. The President's budget proposed a permanent fix to the AMT by replacing it with a so-called Buffett tax, but the President's math just never added up. Supposedly, nonpartisan policy experts and fact checkers have been eager beavers when it comes to criticizing the math in Governor Romney's tax proposal, but maybe they should check the President's math as well.
If we do not eliminate the AMT, it will hit millions and millions of American taxpayers, unjustly so. The President claims a permanent fix is a priority of his. In his fiscal year 2013 budget, he proposed to offset it with the Buffett tax. People treat the President's fiscal year 2013 budget as though it never happened. In some sense, I understand that. It received not a single vote in the U.S. Senate, even with his own party controlling the Chamber. But that said, it is the President's budget. He wrote it. He presented it. He owns it. And how does it add up? Consider the math on his permanent AMT fix. Again, he proposes to replace the AMT--ostensibly helping middle-class taxpayers--with the Buffett tax--ostensibly hurting the evil rich. That sounds great until you look at the numbers. How much revenue loss would there be from a permanent AMT fix? Madam President, $864 billion, to be exact. And how much would the Buffett tax yield? Fifty billion dollars--a little less, actually. So the Buffett tax misses the target by over 94 percent. The President would need to increase his Buffett tax by over 1,600 percent to fill in the gap. There are not enough Pinocchios in all of Disney World to describe the phoniness that is the President's AMT proposal.
Ultimately, the AMT needs to go in its entirety. It will probably go as part of comprehensive tax reform. Unfortunately, President Obama and his campaign are undercutting the prospects for tax reform every day with their dishonest attacks on Governor Romney's tax proposal, a key element of which has been endorsed by the Chairman of the President's own Export Council even as his desperate campaign attacks that same feature. But absent a permanent AMT fix, a temporary patch is both a viable and a necessary option.
So here we are, with all of these must-address measures. We have the AMT, tax extenders, the death tax, sequestration, and, of course, the expiration of the 2001-2003 tax relief that threatens to throw our economy into another recession. Yet, at a moment crying out for Presidential leadership, we get campaign partisanship. The President and his allies only seem concerned about getting past the next election. At a time when serious solutions to our fiscal crisis are demanded, they offer no plans of their own. We hear that we need to stay the course, but the course we are on has provided us with four straight trillion-dollar-plus deficits and a debt that threatens not only our long-term but immediate fiscal well-being.
The President's suggestion that we can solve these problems by cutting defense spending and raising taxes on the wealthy is a parody of serious fiscal policy. It might be good for a bumper sticker, a college sociology seminar, or an Occupy Wall Street sit-in, but the numbers do not add up.
The President's mantra is that tax increases on the rich are all that is necessary to pay every bill and balance every budget. That is not an oversimplification. If you watch the President's campaign commercials, the only thing he says about balancing the budget is that he wants to ``ask the wealthy to pay a little more.'' If that is truly the extent of the President's plan for solving our fiscal crisis, he is either being dishonest or he needs to invest in a new calculator.
Let me give an example. Our Nation currently faces what some, including Federal Reserve Chairman Ben Bernanke, have called a fiscal cliff. With tax relief scheduled to expire at the end of this year, our Nation faces the possibility of being thrown into another recession. According to the CBO, that outcome is a certainty if the tax relief signed by both Presidents Bush and Obama is allowed to expire under current economic conditions. Yet, rather than working with the Republicans in Congress to extend that tax relief--tax relief that originally passed with bipartisan support and was extended in a similar fashion in 2010--President Obama has opted to hold American taxpayers hostage in order to extract a tax increase for those making more than $250,000 a year. And why? Not to help the economy and not to reduce the deficit but for electoral votes. The President and his supporters claim these tax increases are necessary if we are to get our fiscal house in order, but if you do the math, the President's proposal would only raise enough revenue to reduce this year's deficit by 5 percent. It would be just enough to fund the government's activities for about a week.
Whether we are talking about the Buffett tax in the context of the AMT discussion or the President's fixation with raising the top marginal tax rates in the midst of a historically weak economic recovery, it is clear that the President and his allies in Congress are not serious about addressing the issues most important to the American people. These issues will not go away after the election, but the President has offered no positive program for getting us out of this mess. And I have gotten quite a kick out of them saying Governor Romney should be more specific on what he is doing. Where is the President's plan? What is he going to do? How are we going to get out of this fiscal mess? Not a doggone thing being said except things that do not add up mathematically--to borrow a very important phrase by a person from the Democratic Party during our convention.
Now, the President might envision himself as this century's Franklin Roosevelt, but in this campaign the only thing President Obama has to offer is fear--fear itself. His failure to offer solutions does not just have a theoretical impact, this failure of leadership hits real people in a real way. Do not just ask those making their quarterly tax payments on Monday. Ask any small business owner whether they are worried about their taxes going up next year. Ask any American who is having trouble making ends meet if they are concerned that Congress has neglected to address so many issues that will dramatically impact their financial well-being.
When the Senate recesses next week until after Election Day, I wonder what my colleagues in the majority will tell their constituents when they are asked why Congress has not acted on these items. This checklist right here that we were talking about before, all of those are important. We have to do those. My guess is they will say it all had to wait until after the election. That is all they can say because if they were to come clean, they would have to admit that they did not want to pass any of these things. They were more interested in campaigning on our tax problems than on fixing them.
If we go until the end of the year without addressing these pressing issues, the wound to our Nation's economic and fiscal well-being will be entirely self-inflicted. These are matters that could have and should have been addressed months ago, and we need to address all of those issues. That we have arrived at this point--three-quarters of the way through the year--without fixing these problems should be an embarrassment to the President and those in Congress who are supportive of his agenda.
I yield the floor.
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