Rick Santorum

Mr. SANTORUM

Mr. SANTORUM. Mr. President, on January 31, 1995, I introduced my first bill as a U.S. Senator, S. 3004, the Commercial Aviation Fuel Tax Repeal Act. We are now on the verge of passing a budget which, for the first time in 26 years, will balance the Federal budget and eliminate the Federal deficit. I am proud to note that S. 304 has been incorporated to a great extent into this historic budget. As a result, I wish to take this time to mention the thousands of workers and the many unions and business professionals who have provided consistent support for this crucial piece of legislation. First, I wish to submit for the record a resolution as passed by the National Aerospace Workforce Coalition. Throughout the debate on the aviation fuel tax issue, I worked closely with the National Aerospace Workforce Coalition. This organization consists of local unions and workforce associations. The coalition represents some 42 different unions in 29 States. Many of my colleagues have received letters and phone calls from coalition members in their States. The coalition believes, as I do, that a commercial aviation fuel tax will be extremely harmful to America's manufacturing base. The resolution which I have submitted goes to the heart of the relationship between a tax on jet fuel and commercial aircraft orders, namely, that every increase in taxes on commercial jet fuel will be followed by more cancellations and deferred orders of American made engines and aircraft. The labor unions supporting the repeal of this fuel tax include the spectrum of America's aerospace industrial base. This resolution has been passed by unions representing scientists and engineers, production workers, as well as unions engaged in casting and fabricating the specialized metals used in the production of modern aircraft. Further, I wish to note that the International Association of Machinist and Aerospace Workers, District Lodge 141 passed a similarly worded resolution on October 24, 1995. This union represents 34,000 members at 13 airlines, and their delegates unanimously passed this resolution at their annual convention. The balanced budget which the Senate will pass shortly relieves the airline industry from any unfair tax, but only for a limited time. Currently, the House of Representatives has extended the aviation fuel tax exemption for 2 years and the Senate shall extend it for only 17 months. I am pleased that in these difficult budgetary times both Chambers have recognized not only the unfairness of this unprecedented tax, but the critical need to avoid further hindering a struggling industry. However, absent outright repeal, I strongly believe that any extension of the exemption must run for at least 2 years. I will work hard during the House-Senate conference on the budget to ensure that the extension extends for at least this long. Further, it is critical for the Congress to address broader taxation and fee issues with respect to the airline industry during the next session of the 104th Congress. I will work to hold hearings on this issue in the spring of 1996. The reasons for at least a 2-year extension are clear. U.S. airlines have lost money every year since 1990, with losses for the period totaling almost $13 billion. Almost one-half of all major U.S. airlines have filed for chapter 11 bankruptcy protection during the crisis, including America West, Continental, twice, TWA, twice, Eastern, Pan Am, and Midway. The last three have ceased operations altogether. Cumulative industry debt since 1990 has increased from $9 billion to $46 billion, and the bonds of all major U.S. airlines are rated as junk bonds. Airlines are facing Government-mandated fleet replacement costs to upgrade fleets to quiet technology aircraft that will exceed $15 billion a year through the rest of the decade. Imposing a fuel tax now, at a cost of $527 million a year, would wreak havoc on an industry struggling to survive. In addition, the airline industry has historically paid excise and cargo fees in lieu of any fuel tax. These fees will exceed $6.9 billion in 1995. Imposing a fuel tax absent any broader effort at reassessing these other taxes would be both unprecedented and unfair. Hence, for both fiscal and fairness reasons, an extension of the aviation fuel tax exemption is greatly needed. While we in the Senate have taken steps in the right direction by incorporating S. 304, in part, into this year's budget act, we must continue to ensure that the airline industry is taxed fairly. This industry is one of our Nation's last great manufacturing gains, and its tens of thousands of workers deserve the right to continue to uphold America's predominance in this critical industry. I ask that the National Aerospace Workforce Coalition resolution referred to earlier be printed in the Record. The resolution follows: Aviation Fuel Tax Resolution Whereas our country's airline industry has suffered enormous losses over the last five years, reducing airline employment by more than 120,000 workers and forcing remaining workers to accept reductions in wages and benefits; Whereas several years ago government mandates required the airline companies to pay excise taxes and fees in lieu of a fuel tax, which today collectively amounts to more than 52 cents per gallon of fuel and places our nation's airline companies at a competitive disadvantage; Whereas there is a direct relationship between a healthy airline industry and a healthy aerospace industry, and that only profitable airlines can modernize their fleets with American-built engines and aircraft to help revive an aerospace industry already devastated by drastic cuts in defense; [[Page S 16157]] Whereas over 1,000 commercial aircraft orders have been canceled or deferred in the past five years, because of losses in the airline industry resulting in a cost of 125,000 airframe and aerospace jobs; Whereas every increase in taxes on commercial airline fuel will be followed by more cancellations and deferred orders of American-made aircraft; Therefore the National Aerospace Workforce Coalition urges the Senate to repeal the aviation fuel tax as it will only cause more hardship for American workers and further erode our country's aerospace industrial base.

Mr. SANTORUM

Mr. SANTORUM. I would love the Senator from New Jersey--I know he is a Rhodes scholar--but redefine for me, please, how someone who does not pay taxes----

Mr. SANTORUM. Will the Senator from Oklahoma yield for a question just so I understand the point he just made? It is an interesting point. I am not too sure I was fully aware of it. What the Senator is suggesting is that the earned income tax credit for low-income Americans actually pays out money in excess of all their Federal tax obligations. Is that correct?

Mr. SANTORUM. The new definition of what is a tax increase is when the Federal Government does not pay out more money to you, and you already do not pay, that is a tax increase. So if you are entitled to get more welfare--let us call it what it is. It is a welfare check. It is a check not to offset taxes, but it is a cash payment to families or to individuals. If you were expected to get more money, then by not giving them more money, we are giving them a tax increase even though they do not pay taxes.

Mr. SANTORUM. On his time, I would love to have him answer that question.

Mr. SANTORUM. That is an amazing statement. How can anyone call not getting more money from the Federal Government when you pay no taxes a tax increase?

Mr. SANTORUM

Mr. SANTORUM. I would be glad to.

Mr. SANTORUM. Mr. President, I withdraw my amendment.

Mr. SANTORUM. The Joint Tax Committee is the official estimator?

Mr. SANTORUM. Will the Senator yield? Is the Office of the Treasury the official estimator of the tax provisions in the U.S. Congress?

Mr. SANTORUM. That is why we will have debate tomorrow.

Mr. SANTORUM. If the Senator will yield, the Senator from New Mexico and the Senator from Delaware have on numerous occasions come to the floor and discussed the tax cut and suggested that 90 percent of the benefits of the tax cut go to people under $100,000. If that is correct, that means only $23 billion, roughly, $24 billion, roughly, goes to people over $100,000. I do not know how you come up with a figure of $50 billion for those over $250,000.

Mr. SANTORUM. Where does the Senator from North Dakota come up [[Page S 15553]] with a $50 billion figure for those making over $250,000? I would love to see the estimate.

Mr. SANTORUM. The money is a credit toward the trust fund. That trust fund surplus, like the aviation fund surplus, like the highway trust fund surplus, is part of the overall budget and is used for accounting purposes--for accounting purposes--to offset other deficiencies in other areas of the budget, for accounting purposes.

Mr. SANTORUM. It is, as the Senator from North Dakota knows very well, what we are looking at as accounting practices to determine what the overall assets and liabilities are for Government; what you are doing is trying to play games.

Mr. SANTORUM. Mr. President, we have a certification from the Congressional Budget Office that says that the budget comes into balance by the year 2002. The Senator from North Dakota is under the false assumption because we have trust funds they are not part of the Federal Government. They are part of the Federal Government like the highway trust fund is, like the aviation trust fund is. Just like we have a number of trust funds in this budget. To suggest that they are not part of the Federal Government and should not be considered just does not look at reality. The reality is this is all part of the Federal Government. The Social Security Administration is a Federal Agency run by the Federal Government. To suggest somehow they should not be included in a Federal budget, I think, flies in the face of fact.

Mr. SANTORUM. If the Senator from North Dakota will yield for an explanation. I intended to withdraw the amendment. The Senator from Mississippi wanted to speak briefly, and then I was going to withdraw the amendment.

Mr. SANTORUM. Mr. President, we just witnessed on the Senate floor the President's revised balanced budget getting no votes; his plan to balance the budget over 10 years getting no votes on the U.S. Senate floor, no support on either side of the aisle. Nobody on the other side of the aisle, and rightfully so, I might add, defended his balanced budget. All I suggest to the Democratic National Committee, which is running a television ad saying that the President has a balanced budget, that it is now, I think, apparent that the President does not have a balanced budget and that nobody believes he has a balanced budget. So quit running ads on national television saying he does have a balanced budget. There is no support for phony numbers in the U.S. Senate from either side of the aisle, and I commend my colleagues on both sides of the aisle for standing up and sending a very clear message down Pennsylvania Avenue that we are tired of the President running around campaigning and not coming back here to work on a serious balanced budget resolution and reconciliation. We have the opportunity, as a result of the 1994 elections and the movements in this House and Senate, to pass a balanced budget. No more phony-baloney politics, but real deficit reduction, real balanced budgets. Mr. President, 0 to 96; 0 to 96, I think that is a pretty clear message to the President and his TV commercial that the Democratic National Committee has out which says--as they read the text, there is an image of the President sitting at his desk working on a balanced budget plan. I suggest that the President actually do go to his desk and actually do start working on a balanced budget plan and not try to pull the wool over the American public's eyes on a budget that does not balance, on a plan that does not do what he is claiming it does. I am hopeful that the message will be sent to the President and to the Democratic National Committee that these kinds of ruses that are trying to be pulled on the American public have no place in a serious dialog about solving the great fiscal problems of this country. I want to commend both sides of the aisle for delivering that message loud and clear this afternoon to the President of the United States that his budget is phony, his budget does not work; that he needs to get serious about balancing this budget; that he needs to come to the Hill and sit down and work on a bipartisan basis to solve this problem; and that the campaigning has to end and being President and presiding has to begin today. We are ready to go. We are going to start tomorrow. We are going to pass a budget. We are going to pass a reconciliation package, and I hope at that time that the President will hear the call, will hear 0 to 96 on his phony plan and come here and get serious about the business at hand. I yield the floor. Mr. DORGAN addressed the Chair.

Mr. SANTORUM. We are trying to get this Government solvent to pay back----

Mr. SANTORUM. I suggest no one is taking that money and using it without replacing it with an interest-bearing note required by law. There is no raiding of any pension fund going on here. To suggest otherwise is a deliberate attempt to scare people, when, in fact, the Senator from North Dakota knows very well that money is only as secure as the solvency of this Government.

Mr. SANTORUM. Mr. President, I move to reconsider the vote by which the amendment was rejected.

Mr. SANTORUM. Mr. President, one additional comment. The Senator from Kentucky and I just had a conversation. I want to give the Senator from Kentucky and the Democrats credit for not defending the President's budget. He is absolutely right, he is not defending the President's budget because the President is not using the right numbers, so I give credit to the other side for not standing up and defending this budget. I think they are showing character in not doing so. I think, hopefully, that is a message that will be sent to 1600 Pennsylvania Avenue. Mr. President, I ask for the yeas and nays.

Mr. SANTORUM. I will be happy to yield.

Mr. SANTORUM. I reclaim my time, and I encourage that we defeat this amendment. I will be happy to take an up-or-down vote. If the Senator from Kentucky will allow an up-or-down vote, we can do that. If the Senator requires me to table, I will be happy to do that.

Mr. SANTORUM. If I can reclaim my time, I am sure the Senator from New Mexico will present the letter from the Congressional Budget Office Director which certifies the budget does balance in 7 years. I do not know where the Senator from South Carolina got his information.