Federal Aviation Administration Extension Act of 2010
Floor Speech
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Mr. SANDERS. Mr. President, I am aware that yesterday, by a vote of 83 to 15, the Senate voted to ask for cloture on the tax agreement reached between the President and the Republican leadership. I was in the minority, and I wish to very briefly--I spoke on the issue at some length the other day. I will be a little bit briefer this afternoon. But I think it is important to explain why I and a number of us and many Americans think this is a bad agreement and that, in fact, we can do a lot better.
Just a few points. No. 1, this country has a $13.8 trillion national debt. Our middle class is shrinking, and it is unconscionable to me that we are in the process of providing huge tax breaks to the wealthiest people in this country to drive up the national debt, which our kids and grandchildren will have to pay off. I think that is absolutely wrong.
During the Bush Presidency alone, the wealthiest 400 Americans saw their income more than double, while their income tax rates dropped almost in half from 1992 to 2007.
The richest 400 Americans now earn, on average, $345 million a year and pay an effective tax rate of 16.6 percent.
The bottom line is, given all the problems facing this country, lowering taxes for people who are extraordinarily wealthy, whose incomes are soaring, whose tax rates are going down, should not be a major priority of the Senate.
Let's be very clear. If we continue to borrow money now to give tax breaks to those people who do not need it, our kids and our grandchildren will be paying higher taxes in the future. We should not be doing that.
Here is a point I wish to emphasize. I know the President and many of my colleagues are saying: Hey, don't worry about it. This extension of tax breaks for the wealthy is only for 2 years. I wonder if my Republican friends would agree with me that it is not their intention to only make this extension for the wealthy for 2 years. I am quite sure 2 years from now they will be on the floor, maybe along with some Democrats, saying: Oh, no, that is not enough. We have to extend it again. So anyone who thinks we are only extending tax breaks for the wealthy for 2 years I think--maybe I am wrong--is sorely mistaken. I think we are talking about extending the tax breaks to millionaires and billionaires into the indefinite future.
That is not just what I am thinking. Here is what Dan Bartlett, a gentleman who was President Bush's former communications director, said to the well-known columnist, Howard Kurtz, just recently, last week, December 3, 2010:
We knew that, politically, once you get it [the tax cuts] into law, it becomes almost impossible to remove it. That's not a bad legacy. The fact that we were able to lay the trap does feel pretty good, to tell you the truth.
My Republican friends know it. In 2 years, you will be back to extend it, and that is what we are voting on. Let's be clear about it. We do not know what the future brings us, but if, in fact, we do end up extending the tax breaks for the next 10 years, as our Republican colleagues want it, it will increase the national debt by $700 billion and would give a tax cut of over $100,000 a year to people earning more than $1 million.
It doesn't make a whole lot of sense to me.
We should also be clear that this agreement between the President and the Republican leadership also continues the Bush era 15-percent tax rate on capital gains and dividends, meaning that those people who make their living off of their investments will continue to pay a substantially lower tax rate than firemen, teachers, nurses, and police officers. Does that make sense? Well, maybe it does to some people; not to me.
This agreement also includes a horrendous proposal regarding the estate tax. Under the agreement between the President and the Republicans, the estate tax, which was 55 percent under President Clinton, will decline to 35 percent with an exemption on the first $5 million of an individual's estate. This decline in taxes in the estate tax applies to the top three-tenths of 1 percent. This is not just the tax breaks for the wealthy; this is a tax break for the very, very, very wealthiest people in this country. At a time when we have a record-breaking deficit, if that makes sense to some of my colleagues, that is fine. It surely does not make sense to me, nor do I think it makes sense to most of the people in this country.
The Congressional Budget Office has estimated that this estate tax giveaway would increase the deficit by more than $68 billion. And while this extension is for 2 years, there is little doubt in my mind that our Republican colleagues will continue to push for lower and lower estate tax rates in the future, on their way to eventually repealing the estate tax permanently. I would remind my colleagues that last year, some of us brought to the floor an amendment that said maybe at a time when our seniors and disabled vets have not gotten a COLA for the last 2 years, maybe we should give them a $250 check. This is for people trying to live on $14,000, $15,000, $16,000 a year. We didn't get one Republican vote--not one Republican vote--but when it comes to huge tax breaks for billionaires, the top three-tenths of 1 percent, I guess there is a lot of support for that. Again, it may make sense to some people; not to this Senator.
There is also an issue I wish to spend a moment on which I think has not gotten the attention it deserves, and that is that this agreement contains a ``payroll tax holiday'' which would cut over $114 billion in Social Security payroll taxes for workers next year. While on the surface this sounds good, it is actually a very dangerous idea. This payroll tax holiday originated from conservative Republicans. Our Republican friends think this is a good idea, because for many of them--not all--the goal is to choke off money going into Social Security to divert money that should go into the Social Security trust fund and over a period of time weaken the solvency of Social Security. Once again, while this is supposed to be a 1-year payroll tax holiday, frankly, it is hard for me to imagine that it will not be continued next year. I suspect it will go on and on, and for many of our conservative friends who want to destroy Social Security, I think they are feeling pretty good about it. I think they are on their way. Less and less money is going to go into the Social Security trust fund and that, in fact, is what they have on their minds.
While the administration claims the money lost from this proposal will be paid back through the general fund of the government, this proposal would leave Social Security dependent on government revenues rather than the direct contributions of workers who have successfully funded this program for the last 75 years. And once you are into Federal funding for Social Security, let me tell you, it will be cut and cut and cut and you are talking about the beginning of the end for Social Security. So I have very real concerns about that. Frankly, maybe it is a 1-year program. I doubt it very much. I think it will be extended.
Further, while some of the business tax cuts in this agreement may work to create jobs--maybe some won't--economists I think from all ends of the political spectrum believe that the much better way to spur the economy and create jobs is to spend money rebuilding our crumbling infrastructure. No debate. We need trillions of dollars of work to rebuild our roads, bridges, water systems, levees, public transportation, our rail system. I think most economists believe when you put money into infrastructure, not only do you increase the long-term productivity of our country and our international competitiveness, you also create jobs a lot faster than many of these business tax cuts do.
Furthermore, one of the other reasons I am voting against this agreement is that I know the President and some of the Republicans said, Well, we reached a compromise on extending unemployment benefits. Well, I don't believe that was a compromise. The truth is that while it is morally unacceptable that we would turn our back on millions of workers who in the midst of this terrible recession have for a very long period of time not been able to find a job--obviously we have to extend unemployment benefits, but to say it is a compromise that our Republican friends came along with, this is something I don't accept. The truth is that for the past 40 years under both Democratic and Republican administrations, under Republican leadership in the House and Senate, and Democratic leadership in the House and Senate, whenever the unemployment rate has been above 7.2 percent, unemployment insurance has always been extended. In other words, this has been for decades bipartisan policy. Republicans and Democrats have said, You can't leave people to lose everything, leave them to lose their dignity, not being able to take care of their families when unemployment benefits are not allowed. This is not a compromise. This is just an extension of 40 years of bipartisan policy.
Furthermore, there are a number of additional extenders in here dealing with ethanol, dealing with NASCAR, dealing with tax breaks to oil and gas companies, dealing with rum producers in Puerto Rico and the Virgin Islands that I think, to say the least, have not gotten the kind of discussion they deserve.
Are there positive aspects of this agreement? Of course there are. Extending middle-class tax cuts to 98 percent of Americans, the earned income tax credit for working Americans, and the child-in-college tax credits are all extremely important, and that is something we have to do. But when we look at the overall package, we must put it in a broader context. What will the passage of this legislation mean for the future of our country?
The bottom line is, as I think most Americans know, the middle class is in a state of collapse, poverty is increasing, people on top are doing phenomenally well. We need to put people to work and put them to work right now. I think the fastest and best way to do that is to address our crumbling infrastructure.
Second of all, when we have the most unequal distribution of income of any major country on Earth--the top 1 percent earn more income than the bottom 50 percent--giving tax breaks to people who don't need it--and in fact, ironically, there are millionaires and billionaires out there who are saying we are doing great. We don't need a tax break. Use it to deal with the poverty rate among our children. Use it for education. Use it for health care. We don't want it. We don't need it. We are throwing it back.
So I think, and I believed from the very beginning, that we could reach a much better agreement than we have reached right now.
I intend to vote no on this agreement, and I hope as many of my colleagues as possible will do the same.
With that, Mr. President, I yield the floor.
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