J. Thurmond

Mr. THURMOND

Mr. THURMOND. I thank the Chair. (The remarks of Mr. Thurmond pertaining to the introduction of S. 2074 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. THURMOND

Mr. THURMOND. Mr. President, I rise today to join my colleagues in discussing reform of our tax system. I commend the Senator from Georgia, for his leadership on this issue. I wish to address another aspect of our unfair tax system--the estate tax. Today I am introducing a bill to repeal the Federal estate and gift taxes and the tax on generation-skipping transfers. This bill is very simple. It repeals, in its entirety, subtitle B of the Internal Revenue Code of 1986. This repeal is effective for estates of decedents dying and gifts and generation-skipping transfers made after the date of enactment. Mr. President, the Federal estate and gift tax structure is perhaps the most unfair and inefficient revenue source used by our Government. First, these taxes represent multiple taxation on savings and investment. Income is initially taxed when it is earned. If any of that income is saved, the earnings on the savings are taxed. A third level of taxation occurs as capital gains taxes are paid. Finally, after a lifetime of savings and investment, estate and gift taxes are assessed. Estate and gift tax rates are much higher than income tax rates. Second, these taxes inhibit economic growth and job creation. Family owned businesses, farms, and ranches are the source of most new jobs created in the United States. Yet it is these family owned businesses that are most affected by estate and gift taxes. In many cases, family businesses do not have sufficient liquid assets to pay estate taxes upon the death of the owner. Frequently the business is liquidated or they sell the farm. As a result, jobs are lost and economic activity ceases. Estate and gift taxes further stifle economic growth because of the increased cost for capital accumulation. When lifetime savings are taxed at high rates, the incentive to save is reduced. Spending and consumption replaces savings and investment. As a result, wage rates and employment suffer. Third, estate and gift taxes result in economic inefficiencies, as taxpayers attempt to avoid or minimize these taxes, or allocate resources for estate planning. A survey by the Center for the Study of Taxation found that 80 percent of owners of family businesses reported taking some steps to plan for estate taxes. Such mechanisms included life insurance, buy/sell agreements, restructuring family partnerships and trusts, and charitable bequests. According to a report on this survey, 62 percent of the family businesses stated they would not have spent the time or money on estate planning. They did so because they felt estate and gift taxes threatened the survival of their businesses. Mr. President, with all the negative economic consequences resulting from estate and gift taxes, one must ask if these taxes are worth the cost. I, and many others, have concluded they are not. There is a misconception that such taxes only affect the very wealthy and that these taxes generate large amounts of revenue. The fact is, these taxes impact everyone, directly or indirectly. Furthermore, these taxes are a minor revenue source for the Federal Government, accounting for only 1 percent of total Federal receipts. The amounts actually collected must be offset by the billions spent each year for enforcement and compliance activities. Mr. President, it is time to abolish Federal estate and gift taxes. These taxes are unfair and inefficient. They hinder economic growth, destroying family businesses and jobs. They result in resources being diverted to estate planning activities, away from economic growth. These consequences, as well as the actual costs of collecting these taxes, do not justify such taxes or the minimal revenues they produce. I urge my colleagues to support repeal of the Federal estate and gift taxes. I ask unanimous consent that a copy of the bill be printed following my remarks.

Mr. THURMOND

Mr. THURMOND. Mr. President, pursuant to section 304(d) of the Congressional Accountability Act of 1995 (2 U.S.C. sec. 1384(d)), a notice of issuance of final regulations was submitted by the Office of Compliance, U.S. Congress. The notice contains final regulations related to Federal service labor-management relations (Regulations under section 220(d) of the Congressional Accountability Act.) The Congressional Accountability Act requires this notice be printed in the Congressional Record, therefore I ask unanimous consent that the notice be printed in the Record.

Mr. THURMOND

Mr. THURMOND. Mr. President, I ask unanimous consent on behalf of the Governmental Affairs Committee to meet on Tuesday, September 10, 1996, at 10 a.m., for a hearing on the subject: Technical and Management Issues in IRS Modernization.

Mr. THURMOND. Mr. President, I ask unanimous consent that the Committee on the Judiciary Subcommittee on Constitution, Federalism, and Property Rights be authorized to meet during the session of the Senate on Tuesday, September 10, 1996, at 10 a.m. to hold a hearing on Constitutional Implications of the Chemical Weapons Convention.

Mr. THURMOND. Mr. President, I ask unanimous consent that the Subcommittee on HUD Oversight and Structure of the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on Tuesday, September 10, 1996, to conduct a hearing on oversight of the Fair Housing Act and its enforcement.

Mr. THURMOND. Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet on Tuesday, September 10, 1996, at 5 p.m. in executive session, to consider certain pending military nominations.

Mr. THURMOND. Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be allowed to meet during the Tuesday, September 10, 1996 session of the Senate for the purpose of conducting a hearing on Amtrak Service.

Mr. THURMOND. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Tuesday, September 10, 1996, at 9:30 a.m.

Mr. THURMOND

Mr. THURMOND. Madam President, I ask unanimous consent that prior to the two consecutive votes scheduled at 2:15, there be 2 minutes of debate equally divided in the usual form.

Mr. THURMOND. I thank the Senator.

Mr. THURMOND. Mr. President, I rise today as an original cosponsor and in support of the Defense of Marriage Act. This needed legislation is a straightforward approach to protect the rights of the individual States to determine policy decisions appropriately within their borders. Simply stated, this bill provides that no State be required to recognize a same-sex marriage that may have been given effect in another State. Additionally, this bill reaffirms the 200-year-old Federal policy in this country concerning the use of the words ``marriage'' and ``spouse''--a marriage is the legal union of a man and a woman as husband and wife, and a spouse is a husband or wife of the opposite sex. Mr. President, I can say without reservation that the fine people in my home State of South Carolina should not face the possibility of being forced to legally recognize same-sex marriages. This bill is needed to protect the right of every State to make their own determinations concerning the definition of a legal marriage. Article IV, section 1 of the Constitution provides that full faith and credit be given in each State to the public acts, records, and judicial proceedings of every other State. Additionally, the Congress is granted the power to prescribe the manner in which State acts are given effect in other States. The Defense of Marriage Act is wholly consistent with the Constitution and protects the sovereignty of the States to make their own decisions concerning same-sex marriages. Mr. President, I am amazed that we have reached the point in this country where the Congress must adopt this type of legislation to protect the sanctity of marriage. Because it is needed, I support the Defense of Marriage Act which reaffirms the notion of marriage as it has been recognized throughout 5000 years of civilization--marriage as a legal union between one man and one woman, as husband and wife.

Mr. THURMOND

Mr. THURMOND. Mr. President, this Defense authorization bill has been done from the very outset in a very bipartisan spirit. Senator Nunn, I am sure, will speak on that side to that effect. We have worked together, Republicans and Democrats, to bring into the Senate a bill that we feel is fair and just. The House has already passed this particular bill. The President has said he will sign this particular bill. I urge all Senators to vote for this bill and show support for our Armed Forces, the men and women who are sacrificing by serving our country and risking their lives to protect the liberty and freedom of this country.

Mr. THURMOND. I can assure Senator Leahy that the cap imposed by section 1304 applies only to funds made available to the Department of Defense for humanitarian and civic assistance. It was not intended as a U.S. Governmentwide cap. It does not apply to funds that are made available to other Federal agencies such as the Department of State or the Agency for International Development.

Mr. THURMOND. I move to reconsider the vote.

Mr. THURMOND

Mr. THURMOND. Mr. President, I agree with Senator Nunn and believe this year's bill is designed to move forward with this very important program. Section 123 of the Conference Report contains a prohibition on the obligation of funds for modifications or upgrades for EA-6B aircraft until funds have been obligated for a reactive jammer program, a report has been received, and 30 days have elapsed from the date of the receipt of the report. Specifically, section 123(a) prohibits the obligation of funds for modifications to EA-6B aircraft until a certification that some or all of such funds have been obligated for a reactive jammer program for EA-6B aircraft. Only research and development funds have been authorized and appropriated for the reactive jammer program and, as I understand it, the funds mentioned in this section refer to those research and development funds for initiation of a reactive jammer program. Does the Senator from Georgia interpret the section as I do?

Mr. THURMOND

Mr. THURMOND. Mr. President, I yield the able Senator from Oklahoma such time as he may require.

Mr. THURMOND. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. THURMOND. I want to express my appreciation to the able Senator from Idaho for the kind words he had to say about my service as chairman of the Armed Services Committee. Senator Kempthorne has been a devoted, able member of that committee and has rendered the defense of this country great service. Our country is indebted to him for all that he has done to promote a strong defense in this Nation. Again, I am proud of his friendship and proud of his service to his Nation. Mr. President, I understand this has been cleared on the other side of the aisle. I have been authorized to yield back all debate time on the Defense authorization conference report.

Mr. THURMOND. I suggest the absence of a quorum.

Mr. THURMOND. I now ask for the yeas and nays.

Mr. THURMOND. Mr. President, I believe the vote on this bill is set for 2:15 tomorrow; is that correct?

Mr. THURMOND

Mr. THURMOND. Mr. President, I rise today to recognize Vice Adm. Edward M. Straw, U.S. Navy, who will retire on October 25 after a distinguished 35-year career. Admiral Straw will relinquish control of the Defense Logistics Agency, which is also known as the DLA, on the day he retires. He has served as Director of the DLA since 1992. DLA is the largest combat support agency in the Department of Defense. If it were a private company, it would be the 78th largest company in the Fortune 500. Admiral Straw's performance in directing 50,000 civilian and military members, and in managing $14 billion in annual funding, has been recognized both inside the Department of Defense and in the private sector as a model of highly effective management. Under his leadership, DLA became one of the first Federal agencies ever to win a Ford Foundation Innovations in Government Award. During his tenure, Admiral Straw reengineered and completely revamped the DLA. His fine efforts have saved our $10 billion to date, and are expected to yield an additional $20 billion in savings and cost avoidance over the next 6 years while significantly improving responsiveness to customers. Admiral Straw began his military service in 1961 when he was commissioned upon graduation from the U.S. Naval Academy. He served numerous sea duty assignments and held senior policy positions within the Department of the Navy. These include Vice Commander, Comptroller and Chief Financial Officer of the Naval Supply Systems Command, and Director of Supply Policy and Programs on the staff of the Chief of Naval Operations. In 1994, he organized and successfully conducted the Defense Performance Review. He will also receive the Society of Logistics Engineers' annual Founders' Award for 1996, later this year. Mr. President, our Nation owes Admiral Straw its appreciation for his truly distinguished service. I wish him and his wife, Chris, continued success and happiness in all future endeavors.

Mr. THURMOND

Mr. THURMOND. Now, Mr. President, I ask unanimous consent that there be a period for morning business with Senators permitted to speak for up to 10 minutes each.

Mr. THURMOND

Mr. THURMOND. Mr. President, I suggest the absence of a quorum.