Don Nickles

Mr. NICKLES

Mr. NICKLES. Will the Senator yield for a question?

Mr. NICKLES. Will the Senator yield?

Mr. NICKLES. Mr. President, I thank my colleagues. I want to speak a little bit about the conference report and maybe a little bit about Senator Landrieu's amendment. First, I wish to compliment Senator Grassley and Senator Baucus for their leadership on this bill. The FSC/ETI bill was a very complicated bill. The Senate provisions alone--there were 276 provisions--dealt with about $180 billion of tax increases and tax cuts, a very complicated bill, very confusing bill. It had international provisions. But it was very important that we move forward, and we moved forward to basically--I started to say--become compliant with the World Trade Organization because they were imposing sanctions on U.S. exports, fees of 12 percent escalating 1 percent per month going up to 17 percent. So it was important that we resolve that problem. Most people think the conference report solves that situation. I compliment them for it. The bill that came back from conference was a better bill than left the Senate--frankly, a much better bill. There are a lot fewer provisions. There were many amendments that were left out. I know the Senator from Louisiana is upset about her amendment being left out. There were hundreds of amendments left out, some of which have a lot of merit, some probably didn't have merit. I don't happen to agree with her amendment, and I want to touch on that for a second. First, I want to finish on the FSC/ETI bill. The underlying premise of the FSC/ETI bill--which I am going to support, and I urge our colleagues to vote for cloture so we can finish this bill--is that we are going to give a benefit to manufacturers, a lower corporate rate than other corporations. I happen to disagree with that. I used to be a manufacturer. I used to run a manufacturing company, Nickles Machine Corporation. We made engine parts. We sold them around the world. Manufacturers get a lower rate, and we do it in this bill in the form of not a rate reduction but in the form of an exclusion of income. I think a rate would be a much simpler way to go, and I think it should apply to all corporations. What we do in this bill is, we give an exclusion for a certain amount of income, I think 3 percent the first 2 years, 6 percent the next 3 years, and then 9 percent beyond that. The net effect of that for most corporations is, the corporate rate would go into effect 34 percent and then 33 percent and then 32 percent, if you are a manufacturer. If you are not a manufacturer but happen to be a corporation, in other words, you do professional services, maybe an attorney or maybe a doctor or something, or you have an accounting firm or you have a financial firm, if you have financial services, you are going to be taxed at a higher rate. I think we should have a uniform corporate rate. It is a mistake. You have a lot of companies that do both. They are a manufacturer and they provide financial services or they provide other services. So you are going to find them having to segregate their income--this part is manufacturing, this part is financial or other services. That is going to mean asking for a lot of audits, a lot of confusion, and maybe problems with the IRS and future Congresses. Future Congresses also will be dabbling with the definition of manufacturer because there are a lot of people defined in this bill as manufacturers that a lot of us wouldn't think of as manufacturers; i.e., individuals involved in architectural engineering, or individuals or companies that are construction or software companies or oil companies or extraction companies. There are software companies, the film industry. You have a lot of industries that aren't normally thought of as manufacturing and are now defined as manufacturing. When people realize there is a 10-percent lower corporate rate if you are defined as a manufacturer, my guess is you will have a lot of future interest and amendments. The lobbyists will be very big trying to make sure that whoever their client is is defined as a manufacturer. So the number of manufacturing jobs, which has been on a fairly steady decline for the last 40 years--it has bounced up in the last year--will increase dramatically, not because there are more manufacturing jobs, but because more jobs are defined as manufacturing. I don't think that is good policy. I have mentioned that. I know Chairman Grassley and Senator Baucus are well aware of my concerns. I tried to fight that fight along with Senator Kyl. We were not successful. We tried every way we could, but we didn't win on that one. But it is important that we become WTO compliant. It is important that we pass a bill. I don't think we are going to solve the problem I am talking about in differentials in the next 3 months or, frankly, the next 6 months. So I urge our colleagues to vote in favor of it. In relation to the Landrieu amendment, her discussion on it, I appreciate her passion. But no one on her side raised this amendment. I sat in the conference for days. She had her chance. There were hundreds of amendments that were not adopted. I don't happen to agree with the substance of her amendment. But everyone was entitled to have their chance. Chairman Grassley insisted on having the entire Finance Committee represented in the conference. I compliment him for that. It was a very open, fair conference. All Senators who were on the Finance Committee were represented, were there, or could have attended. So again, sometimes you don't win on your amendments. I compliment again Senator Grassley and Senator Baucus. I urge our colleagues to vote in favor of cloture. recusal

Mr. NICKLES

Mr. NICKLES. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. NICKLES

Mr. NICKLES. Mr. President, I thank our colleagues for the vote on the last amendment. I especially thank my colleague and friend, Senator Conrad, for his eloquent debate on it, as well as for his support and cosponsorship of the amendment. I think it is a good amendment. I think it helps the budget process. Also, I compliment my friend. It has been a pleasure to work with him on the Budget Committee. This was a good, positive budget change. I thank him for his leadership on this amendment.

Mr. NICKLES. I will not object.

Mr. NICKLES. Mr. President, I move to reconsider the vote and I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. NICKLES. Mr. President, the amendment I am offering today with my ranking member, Senator Conrad, would consolidate jurisdiction for the congressional budget process within the Senate Committee on the Budget and establish shared jurisdiction with the new Committee on Homeland Security and Governmental Affairs over the nomination and confirmation of the Director of the Office of Management and Budget. The amendment would preserve the Government Affairs Committee's jurisdiction over management and accounting measures. Under current Senate rules, jurisdiction over budget process matters is shared with the Committee on Governmental Affairs, a situation that grew out of the creation of the Budget Committee and the modern budget process in 1974. This shared jurisdiction is unique in the Senate, where committees rarely share jurisdiction, and where joint referral of legislation is only accomplished by unanimous consent. Since 1977, the Budget and Governmental Affairs Committees have received joint referral for legislation affecting the budget process pursuant to a unanimous-consent agreement. Under that UC, if one committee acts on a bill the other committee must act within 30 days or be automatically discharged. Our amendment would supercede this consent agreement. We all know the Federal budget process is very complicated. The expertise on this subject clearly resides in the Budget Committee, and Senator Conrad and I believe that is where these issues should be addressed. Over the years, the Governmental Affairs Committee has done little work on the budget process. Although the current jurisdictional situation has not necessarily created significant problems, we believe it is simply unnecessary to have two committees involved in these issues. The Governmental Affairs Committee has a very broad and expansive jurisdiction which the resolution being considered would expand even further to matters of homeland security. Senator Conrad and I believe consolidating jurisdiction over budget process issues within the Budget Committee would eliminate confusion and guarantee that this work is performed by those with the expertise. I encourage my colleagues to support our amendment.

Mr. NICKLES

Mr. NICKLES. I have no objection.

Mr. NICKLES. Mr. President, will the Senator yield?

Mr. NICKLES. I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. NICKLES. My understanding--I will ask the Chair, but it is my understanding the Domenici-Craig amendment was set aside. Under the unanimous consent agreement that was entered into yesterday, there were several amendments to be pending, that are in order. One of those amendments is an amendment I had, dealing with the budget office. I am just trying to get in, too. I have modified it at the request of the chairman of the Government Operations Committee. This is not a significant amendment, but it is an important one and I am trying to advance the movement of this bill, to have a pending amendment. I have now modified it. I have a second- degree amendment pending to it, that Senator Kent Conrad and myself are cosponsoring. It now means that would be the pending amendment to the underlying bill when we go to the regular order on the bill. I would like for us to finish this bill. I know some people wish to speak at length because they happen to be upset about the Homeland Security bill. I may support them in their efforts. That remains to be seen. But I do think it is important we finish the bill that is pending, and there are four or five amendments that are out there. Maybe two or three of those amendments will be agreed to and we can finish the Homeland Security bill in a very short period of time.

Mr. NICKLES. Mr. President, I believe I was recognized. For the information of my colleagues, to help clarify, I believe I understood the underlying Domenici amendment was set aside.

Mr. NICKLES. Mr. President, I call up amendment No. 4041 to amendment No. 4027.

Mr. NICKLES. Mr. President, I call up amendment No. 4027.

Mr. NICKLES. Will the Senator yield?

Mr. NICKLES

Mr. NICKLES. Madam President, the District of Columbia appropriations bill for fiscal year 2005, S. 2666, as reported by the Senate Committee on Appropriations provides $560 million in budget authority and $540 million outlays in fiscal year 2005. There is no mandatory funding in this bill. The bill provides total discretionary budget authority in fiscal year 2005, of $560 million. This amount is equal to the President's request, it matches the 302(b) allocations adopted by the Senate Appropriations Committee, and is $18 million more than fiscal year 2004 enacted levels excluding fiscal year 2004 supplemental appropriations. I commend the distinguished chairman of the Appropriations Committee for bringing this legislation before the Senate, and I ask unanimous consent that a table displaying the Budget Committee scoring of the bill be printed in the Record.

Mr. NICKLES

Mr. NICKLES. Madam President, the pending Foreign Operations appropriations bill for Fiscal Year 2005, S. 2674, as reported by the Senate Committee on Appropriations, provides $19.386 billion in discretionary budget authority and $26.728 billion discretionary outlays in Fiscal Year 2005. The bill also includes an additional $43 million in mandatory spending. The discretionary totals are $1.933 billion in budget authority and $250 million in outlays below the President's request. The discretionary budget authority provided in the bill matches the 302(b) allocation adopted by the Senate Appropriations Committee as well as the amount provided in the House-passed bill. The discretionary outlays provided in the bill are $57 million less than the 302(b) allocation and $29 million above the House-passed bill. Section 595 of the bill includes $360 million in 2005 budget authority for Iraqi debt relief and Section 599D of the bill includes $150 million for humanitarian needs in Darfur, Sudan. These amounts are designated emergencies and are paired with a rescission of like amounts of budget authority from the Iraq Relief and Reconstruction Fund, which has an emergency designation. Section 599E of the bill includes an additional $150 million in emergency budget authority for the Global Fund to Fight AIDS, Tuberculosis, and Malaria. There is no transfer or rescission associated with this provision. All three sections are subject to a Budget Act point of order. While I will not raise a point of order on these provisions I do ask the conferees to hold the line on spending in the bill so that it does not exceed 302(b) allocation and to include appropriate offsets for any provisions with emergency designations. I ask unanimous consent that a table displaying the Budget Committee scoring of the bill be printed in the Record.

Mr. NICKLES

Mr. NICKLES. Mr. President, I have heard some statements where people are insinuating that American combat personnel are getting gypped by this bill. That is false. We are giving them a benefit they didn't have before. We are saying they can use combat pay in computing their earned-income tax credit, or not. If it is to their advantage to use it, they can. If it is to their advantage not to use it, they can pass. This is a new provision. This is something they didn't have in the past. They have it now for 2 years. The Treasury advised against this because it is very complicated, very confusing, hard to monitor. I have already complained on the floor tonight about how complicated the EIT program is. It already has a 30-percent error rate, and that is without this confusion. This was done previously. The Clinton administration said not to do it. We repealed it at their request. We are putting it back for 2 years. We are trying to see if we can make it work and be factually accurate in computing taxes. This is a new benefit for combat pay which, incidentally, is not taxed. It is a good deal for American soldiers. It is not a bad deal. I resent the statement implying that they are coming up short. This is a good new benefit for them, and we will see if it works. I thank my colleague from Iowa.

Mr. NICKLES. Mr. President, will the Senator from Iowa yield 1 minute?

Mr. NICKLES. I want to compliment my colleague, Senator Grassley from Iowa, and also Senator Baucus from Montana. I want to thank them for their leadership. I also want to thank every Senator who voted for the 2001 tax cut and for the 2003 tax cut. I especially want to thank and acknowledge the work of my colleague and friend who is retiring from the Senate, Senator Zell Miller, because if he had not been courageous, particularly in 2003 when he cosponsored the bill we are extending today, we would not be here and families would not have had the tax relief. I also want to compliment President Bush because he pushed for it and he got it. He pushed for it in 2001. We got part of it in 2001 but not much of it. We basically completed it in 2003, and American families got real tax relief. Now we are extending it. I heard one of my colleagues just say: Well, this is worth $600 for an average American family. Let me just give the facts. For a family who has taxable income of $58,000, this is real relief. If they have $58,000 and most of it is taxable income--most of us consider that middle income--and I have heard a lot of rhetoric: Well, those Bush tax cuts are only for the wealthy, they only benefited the fat cats. Let me just give the facts. I love facts. If they have taxable income of $58,000, if they have two kids, the bill we are going to pass tonight will save them $600 because the $1,000 tax credit which we passed in 2001, accelerated in 2003, would revert back to $700, a difference of $300 per child. So that is $300 per child they will save. The $1,000 tax credit per child happened because we passed the tax bill in 2001 and in 2003. The marriage penalty relief for the couple who has taxable income of $58,000 will save $911. Why is that? Because we basically take the 15-percent bracket for individuals and we double that amount for couples. That means a couple who makes $58,000 will still be paying 15 percent. Above that amount, their taxable income, they pay 25 percent. If we do not pass this bill today, that amount they pay the higher bracket on is much lower. It is actually anything above $49,000. The delta of that is $9,000, a difference of 10 percent. So that is over $900 in marriage penalty relief for middle-income families. The 10-percent expansion expires, and we continue that. That is $100. If that is added together for the family of four, middle-income America, making $58,000 of taxable income, this bill will save them $1,611, to be exact. That is a big savings. That is a 26-percent tax increase if we do not pass this bill. We will save them $1,600 by passing this bill. Basically, by passing this bill we are confirming that the bill we passed last year worked and middle-income Americans do quite well by it. I hope a lot of our colleagues who voted against the bill in 2001 or against the bill in 2003 will vote for the bill tonight because this confirms we are helping middle-income Americans. We are helping them a lot, not a couple of hundred dollars. I have heard some people say what we did for middle income was nothing, it was peanuts. This is not peanuts. This is $1,600 for a lot of families all across America. So I compliment President Bush, especially because I think that without his leadership, it would not have happened. I thank those colleagues of ours, Democrats and Republicans, who passed this bill in 2001. And particularly I want to thank Zell Miller because he was helpful in 2003 in passing this bill we are extending tonight. We passed that bill, if my colleagues will remember, with the Vice President breaking the tie. It was a very contentious, very difficult challenge. The President asked me to sponsor the bill and I was happy to do so. We did some other good things in that bill, such as reducing the tax on capital gains to 15 percent, reducing the tax on distributions from corporations to 15 percent because we taxed distributions from corporations higher than any other country in the world. We tied Japan with the highest ranking. We partially eliminated double taxation and made it much more reasonable and responsible, so that was positive. Incidentally, I might say when we introduced that bill in early 2003, the Dow Jones was 7700. Today the Dow Jones is over 10,000. The NASDAQ is up over 40 percent from when we started pushing this tax bill last year, so the tax bill has worked. There have been 1\1/2\ million new jobs created since we passed that bill. So we have had some positive, good signs. This is a positive, good bill. Some people have complained and said we didn't do enough. Oh, we shortchanged the military combat personnel. That is not correct. Some people want to greatly expand earned-income tax credits or expand refundability so the Government will write more checks. The earned-income tax program is a program that is one of the most error-prone programs in the Federal Government. It is over a $30 billion program where we are writing checks--not a tax credit, we are writing checks in almost all cases--and there is a 30-percent error rate. Some people wanted to expand that and make more people eligible for more money, more refundability. That is, not only are we going to take care and make sure you get a credit so you pay less taxes, but we are going to write you a check for taxes you didn't pay. I don't agree with that. I oppose that. I don't think we should use the Tax Code for a welfare program. We have now a situation with the EIC where a person can get the Federal Government writing them a check for 40 percent of the money they are earning. To expand upon that and build that even more I think is irresponsible, when you have an error rate in the program of 30 percent. So that is the reason why there are some objections. I just mention that. The complicated--anyway, I don't need to go too much further. I am pleased we are here tonight. I am pleased we are passing this package. I think this confirms that what we did in 2001 and 2003 has worked. We have helped American families. One final comment. I have heard many comments that I wish we would pay for this program. I have heard several people say that. We are continuing the tax relief we gave last year. If we don't do that, there is going to be a tax increase. How many times do you hear the same colleagues say, when we want to continue to spend, Oh, wait a minute, we want to pay for that? Pay for the same amount of spending? For new spending? Never. As a matter of fact, we stopped $1.7 trillion in new spending. Most of the people saying we have to pay for these tax cuts never want to pay for that new spending. They voted against amendments to stop that new spending, or they voted against budget points of order that did stop new spending. I find it kind of interesting they only want to pay for anything that is called tax cuts, but they never want to pay for spending increases. It is a little ironic, a little interesting. I happen to have the facts and the votes and I am happy to share that. I have votes on every Member, every vote people have cast on spending provisions over the last several years. The budget actually has worked. The budget we passed enabled us to have the tax cuts that enabled American families to keep more of their own money. I might say we do have good news on the budget. The deficit figures are coming down by over $100 billion, just by the last estimate. So we have made good progress. The economy is starting to work. I heard some people say incomes are down. Frankly, incomes are up. Jobs are up. Receipts are up. CBO has been underestimating revenues. Before, they were making mistakes where they were overestimating for a couple of years. Now they have been underestimating because the economy is growing faster. Corporate receipts are exceeding expectations. So the changes we made by reducing capital gains and dividend taxes are helping the economy grow. These family-friendly tax cuts are helping American families. We are giving tax relief to taxpayers and that is what we should be doing in this bill. We are also giving continued assistance for people who do not pay taxes. We still have a very extensive refundability portion in this bill as well. I urge our colleagues to vote for this bill. It is good news for taxpayers. It means for the American family which has taxable income of $58,000, they are going to save $1,600 on their tax bill for next year. That is positive, good news for American families and American taxpayers.

Mr. NICKLES. Mr. President, I am going to assume the Senator from Iowa is going to yield me 10 minutes.

Mr. NICKLES

Mr. NICKLES. Mr. President, the pending Legislative Branch appropriations bill for fiscal year 2005, S. 2666, as reported by the Senate Committee on Appropriations provides $3.688 billion in budget authority and $3.808 billion in outlays in fiscal year 2005. Of these totals, $113 million is for mandatory programs in fiscal year 2005. The bill provides total discretionary budget authority in fiscal year 2005 of $3.575 billion. This amount is $403 million below the President's request, it matches the 302(b) allocations adopted by the Senate Appropriations Committee, and is $50 million more than fiscal year 2004-enacted levels excluding fiscal year 2004 supplemental appropriations. I commend the distinguished chairman of the Appropriations Committee for bringing this legislation before the Senate, and I ask unanimous consent that a table displaying the Budget Committee scoring of the bill be printed in the Record.

Mr. NICKLES

Mr. NICKLES. Mr. President, section 312 of S. Con. Res. 95, the Concurrent Resolution on the Budget for Fiscal Year 2005, as given effect by section 14007(b)(2) of Public Law 108-287, permits the Chairman of the Senate Budget Committee to make adjustments to the appropriate allocations and other budgetary levels when certain conditions relating to wildland fire suppression are met. These conditions having been met, I ask unanimous consent to have a table printed in the Record which reflects the revised 302(a) allocations to the Senate Appropriations Committee. The revised allocations for discretionary budget authority and outlays are the appropriate levels to be used for enforcement during consideration of the fiscal year 2005 appropriations bills.

Mr. NICKLES

Mr. NICKLES. Mr. President, the pending Military Construction appropriations bill for FY 2005--S. 2674--as reported by the Senate Committee on Appropriations, provides $10.003 billion in budget authority and $9.995 billion outlays in FY 2005. This amount is $449 million above the President's request. It matches the 302(b) allocations adopted by the Senate Appropriations Committee and is $159 million more than FY 2004 enacted level. There are no mandatory programs in the bill. I ask unanimous consent that a table displaying the Budget Committee scoring of the bill be printed in the Record.