Monitoring Big, Beautiful Bill Provisions

Floor Speech

BREAK IN TRANSCRIPT

Mr. GROTHMAN. Mr. Speaker, first of all, due to when I was pushed back to start this, my speech will go a little less than 10 minutes, if anybody is planning around it.

Mr. Speaker, I would like to talk a little bit about the big bill that we just passed and some provisions that should be monitored as we work our way not only through the big reconciliation bill but through the appropriations bills, as well.

First of all, I think it is important that the public and the press corps pay attention to what becomes of the low-income housing tax credits in this bill.

Currently, the low-income tax credits were brought to my attention when I attended part of a seminar in which the speaker was bragging about how much money developers could make off of these low-income housing tax credits. The credits give a developer 10 percent of their value of their project over a 9-year period.

There is a time value of money. Even taking into account the time value of money, it means the government pays for 70 percent of the cost of a project. If we felt there was a shortage of anything else in this society, we would never say the answer is to give a business 70 percent of the cost of their product so that they would produce more.

In a related comment on the low-income tax credit, once you say the government is going to pay for 70 percent of these housing projects, it results in overspending on the part of the developer. These projects in California have sometimes cost $800,000 or almost $900,000 per unit.

That is not the norm, but think of it. The government pays somebody 70 percent of the cost of a building. Is it surprising that these people don't put marble countertops in? Is it even surprising that it costs $800,000 or $900,000 per unit?

How in the world under any circumstances in a budget in which the government is borrowing 26 percent of the amount of Federal spending could we, under any circumstances, allow this program to continue?

Nevertheless, it not only continues, but the House of Representatives for some reason decided to increase the amount of money in these credits.

I also think it encourages a little bit of questionable behavior there because, of course, there is always going to be more demand for these credits because so much money can be made off them. Because there is so much demand, I think sometimes, on a State level, when they dole out these credits, the credits go to a politically favored class. It obviously encourages developers to curry favor with politicians who may directly or indirectly determine who gets these projects.

I hope our sleeping press corps pays attention as to what becomes of this program as it works its way through the process. Right now, we are spending about $12.5 billion a year on low-income housing tax credits.

I want to point out that low income is in the title, but well over half the people who live in these buildings are not meeting sub- to low-income qualifications. Even if one is technically low-income, they could have unlimited assets, as well.

In any event, I really think, in all of my years in public life, the most questionable program I have ever come across is the low-income housing tax credit.

The press corps likes to run down politicians. Here is something they ought to be run down for, so I hope they pay a little more attention.

The next thing I would like to point out is what the Republicans do with the SALT deduction. There are a variety of changes in the tax code that we could make that would affect people's behavior. Because tax rates are so high, any change in the tax code affects people's behavior.

Some people feel we ought to make reductions to encourage more research and development. Other people feel that we ought to--I feel we ought to increase the personal exemption to give a special benefit to people who have more children. Some people feel we should have an across-the-board cut and not influence one behavior or another.

There is a small group of people in this building who apparently feel the number one problem we have is that State and local taxes are not high enough, and they want to bring back a deduction for State and local taxes. Right now, we have a low deduction in there, so they are aiming things at not the poor or middle class. They are really aiming things at the well-off people and encouraging governments, like California and especially New York, to raise their taxes.

Recently, on the radio, I was listening to a guy who, I believe, is running for Governor there. He wants to raise the income tax in New York to 11 percent. It is not surprising, then, that I am sure people, like this person, who want to dramatically increase the income taxes in New York would want those taxes to be tax deductible.

Why a Republican would want to do that, I am not sure. I think it is something we ought to talk a little bit more about.

The next area that is going to be working its way that is affected indirectly by the great big, beautiful bill but will be more directly impacted by the appropriations bills that follow is what happens with the Department of Defense.

Right now, we have close to 900,000 employees who are not uniformed in the Department of Defense. I think one of the great things DOGE did is expose how hard or not hard some of those employees are working. We will see what happens with the overall defense budget and whether Congress is willing to take the step forward and say that maybe we don't need 900,000 employees in the Department of Defense who are not uniformed.

The other thing in the Department of Defense we can look at is what Pete Hegseth, who I think is going to be a great Secretary of Defense, has pointed out. He feels, in today's world, aircraft carriers are maybe not entirely obsolete but are not as valuable as they were 30 years ago. That should be obvious from what happened over the weekend when Ukraine used drones to wipe out some aircraft thousands of miles away in the Soviet Union, showing that the nature of warfare is changing rapidly. Our defense budget should change rapidly with it.

Mr. Hegseth has said we are going to use less combat troops. We certainly need a lot less noncombat troops. He has implied that he feels aircraft carriers are becoming a little bit obsolete. Right now, we have 11 aircraft carriers. We have three more under construction to replace the current aircraft carriers.

I think we have to protect our electric grid. I think we have to protect ourselves against hypersonic missiles. I think Israel is doing a good job at that.

We have to prepare for the next war, not prepare to refight World War II.

I think it is important for our press corps to publicize people who talk about the new type of munitions and the new type of armaments we are going to need in a new war. Given that we are so entirely broke and that 26 percent of our budget is borrowed, we have to make sure now more than ever that our defense dollars are spent wisely and not on things that, to a certain extent, are a little bit outdated.

I hope the press covers whether we still need 11 aircraft carriers and asks Pete Hegseth if he still believes that they are overrated because, in today's world, with hypersonic missiles and drones, as the Russians found out, big stationary things, even temporary stationary things, are sitting ducks.

Looking at the clock here, I think I should probably not deal with my other issues, so I will stop speaking. I believe we have somebody else ready to go.

BREAK IN TRANSCRIPT

Source