Pat Toomey

Mr. TOOMEY

Mr. TOOMEY. Mr. Chairman, I demand a recorded vote.

Mr. TOOMEY. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I would point out to my colleagues that this amendment contemplates $1 billion out of a $1,900 billion budget. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from Indiana (Mr. Pence).

Mr. TOOMEY. Mr. Chairman, I yield myself 3 minutes and 15 seconds. First let me say that I recognize the need for the additional defense spending that is in this bill and I support that, and this amendment makes no attempt to offset that necessary increase in defense spending. My concern, however, is the $1.2 billion in nondefense, nonveteran, new spending in the supplemental spending bill. I would point out that last year the Congress and the previous administration increased Federal discretionary spending by more than 8 percent. If we pass this bill in its current form without fully offsetting even the nondefense new spending portion, with sometimes spending reductions elsewhere, then we will have increased spending by approximately 10 percent. In doing so, we will be growing government faster than virtually any other segment of our society. We will be increasing government spending three to four times the rate of inflation. We will be spending away the surplus and that means less money available for tax relief, less money available for debt reduction, a greater chance that soon, perhaps as soon as 2003, we may be dipping back into the Medicare and Social Security funds to pay for all of this spending. To avoid this, we have to draw a line on spending. In fairness, this supplemental bill does attempt to offset part of this new spending, but it does not offset all of the nondefense portion, and one of the offsets does not seem kosher. So this amendment does two things with respect to offsetting the nondefense, nonveteran portion of the spending bill. First, it strikes the rescission of the FEMA funds. Many of our colleagues, including many Democratic colleagues, have discussed during the debate on this bill, as well as during the debate on the rule, that they do not believe it is right to concentrate so much of the offsets in the FEMA account, to cut nearly $400 million from FEMA. The White House has announced its opposition to this rescission. Others feel that maybe this is not a true cut. Some have suggested that FEMA has plenty of money and that this money will never be spent. Well, if that is the case, then it is not a real offset. In either case, this amendment restores the FEMA funding. The second thing is does is it says, let us take all the nondefense, nonveteran spending that is not offset, that is about $1.1 billion, and offset that with an across-the-board \1/3\ of 1 percent reduction in all 2001 nondefense discretionary spending. We provide flexibility for the administration to cut a little more in some cases so that they could cut less or not at all in others. We have done this before in legislation that was signed into law by President Clinton. We leave 100 percent of all defense funding in place, and we leave the 99.67 percent of all nondefense funding in place. I believe the various bureaucrats of the Federal government can survive on 99.67 percent of a budget that is already more than 8 percent higher than last year. This amendment does not attempt to reorder the priorities in the supplemental bill. The committee has decided we need to increase funding in non-defense areas, a number of non-defense areas. We are not contesting those items. What we are saying is if we want to increase spending on those items, that is okay, but pay for it with spending reductions elsewhere. Some opponents of this amendment will say, well, there is no need to do this because it is within the limits of the budget resolution. That is true, but it is beside the point. The fact is, spending is growing too rapidly. We have to draw a line. Mr. Chairman, this amendment will save taxpayers $1 billion this year. It will provide more in debt reduction. It makes it more likely we will avoid spending Social Security and Medicare surpluses, and it restores the funding to FEMA. I urge my colleagues to adopt this amendment. Mr. Chairman, I reserve the balance of my time.

Mr. TOOMEY. Mr. Chairman, I yield myself 15 seconds. I would respond to some of these allegations, Mr. Chairman. First, I would remind my colleagues that our amendment gives discretion to the administration as to how much would be reduced in each area, therefore not specifying any particular program requiring a cut. Secondly, if someone is concerned about restoring funding to FEMA, our amendment restores $384 of the $389 million to FEMA. Mr. Chairman, I yield 2 minutes to my colleague, the gentleman from Arizona (Mr. Flake).

Mr. TOOMEY. Mr. Chairman, I yield 2 minutes to the gentleman from Colorado (Mr. Tancredo).

Mr. TOOMEY

Mr. TOOMEY. Mr. Speaker, I rise in strong support of the underlying bill and in opposition to the Democratic substitute. The difference between the majority's bill and the Democratic substitute is simple. The majority's bill lowers all fees that all investors pay to the SEC, approximately to the point where the fees collected would about cover the cost of operating the SEC. The Democratic alternative lowers some fees, but much less, leaving American savers and investors forced to continue to overpay fees to pay this overcharge so it can serve as a cash cow for all of government. Our bill provides $14 billion over 10 years in fee reduction because the SEC is poised otherwise to charge $14 billion in excess fees. The Democratic alternative provides less than $5 billion in fee reduction. And one of the things that we have heard this morning is a criticism of our bill because it takes into account only the direct costs of the SEC and not all of the other costs that might be associated with some kind of securities enforcement. Mr. Speaker, I have to say that it does not appear that that provision is the intent of the substitute amendment. I would cite a ``Dear Colleague'' that was circulated by the supporters of the substitute in which they argued that excess securities fees should be spent on elderly housing programs, Head Start, medical research, and transportation infrastructure. In other words, basically all of government. The idea embodied in the Democratic alternative is that this should continue to serve as a cash cow for the rest of government. If the minority wants more money for all of these spending programs to grow government, to grow programs, to increase spending, I think it should be paid in a more straightforward way, in a way in which all Americans are more equal in sharing in the burden, and it should not be hidden in fees charged to investors. Mr. Speaker, it is not fair to do it that way. It is not productive to our capital markets to do it that way. I urge my colleagues to reject the Democratic substitute amendment, and vote for the underlying bill which would be a huge savings for America's savers and investors.

Mr. TOOMEY

Mr. TOOMEY. Mr. Chairman, I thank the gentleman for yielding time to me. My daughter is about to turn 1 year old. It reminds me how fleeting childhood is, how brief is that moment in a child's life to have the opportunity to get the education that a child needs to have the opportunity to live a good life and to have all the opportunities to build a better life that we take for granted. Mr. Chairman, this amendment today really is not for our kids. It is not for affluent children growing up in affluent homes. They have choice. They can move to the school district of their choice; and if they do not like that, they can afford to pay their property taxes and pay a tuition for the private school of their choice. This amendment is for the majority of kids, our constituents who grow up in families where they do not have the luxury that that wealth provides. They have the fewest opportunities. They have the most disadvantages. All this amendment says is if those children are stuck in a school that is chronically failing, if they are languishing in a school for 3 years that is not teaching them, then those parents ought to be free to move that child to a school that will work. It is amazing to me that opponents of this amendment can say that a poor child with few opportunities who is stuck and languishing in a school that is not teaching him will force him to stay in that school. That is what the opponents are saying. I just do not know how we can do that, with good conscience. I know there are powerful special interests that have personal stakes in maintaining the monopoly that they currently have. They do not want any kind of competition to upset what they have going. But frankly, the special interests are not the children's interests. I just have to ask my colleagues not to block the schoolhouse door from the kids who do not have access to the educational opportunities that they deserve. I want to thank the gentleman from Texas (Mr. Armey) for offering this amendment, and I urge all my colleagues to think about all those kids that are in schools that are failing. There are great public schools, but we know there are a lot of schools that are not working. There are a lot of kids that are not getting the education they need and deserve. This amendment would help the kids who need that help the most. I would like to urge my colleagues to vote for this amendment.

Mr. TOOMEY

Mr. TOOMEY. It is not rational. It is not in the interest of anybody to do this, but yet we perpetuate this, even in light of the fact that we have millions of Americans who are uninsured. Clearly, many of those would be better able to afford the insurance if they could deduct it; just as corporations already do. I think what the chairman is suggesting is merely that individuals get the same kind of treatment that corporations already get.

Mr. TOOMEY. Why would we not extend that tax treatment to individuals?

Mr. TOOMEY. Again, I think this is a very important point, because again we have a Tax Code that causes such an inappropriate distortion in our economy. We have a Tax Code that says if a corporation goes out and buys insurance, health insurance for an employee, the corporation can deduct that as a legitimate expense. It is deducted from their tax liability. That is fine. When an individual or a small business, unincorporated small business, goes out and tries to purchase that identical policy, that person cannot deduct it. Now, what is the possible justification for that?

Mr. TOOMEY. If the gentleman will yield once again, that is a very important point. There is an enormous amount of money, by many responsible estimates, as much or more than what is collected from the death tax every year, is spent to avoid it. Now think of how counterproductive that is; to force people to spend that kind of money all to circumvent this onerous tax. The gentleman is exactly right. This money is going to pay attorneys and accountants to set up trusts and all kinds of funds and to pay massive amounts of insurance premiums, which is such a counterproductive use of this capital. This is money that could be invested in our economy to grow the economy, to grow those small businesses, to create more of those jobs that we know these businesses are so inclined to do if given the opportunity. But instead, we force them to allocate resources in a way that makes no economic sense; no sense for their business; no sense for our economy. It is all driven by this terrible flaw in the Tax Code, which is why it is so important that we repeal the death tax in its entirety rather than just create some increase in the exemption. If we just increase the exemption, we have not gotten rid of the problem. We have diminished it somewhat, but the only way to resolve this problem is to repeal an unfair tax.

Mr. TOOMEY. If the gentleman will yield, in my district in the Lehigh Valley and the Upper Perkiomen Valley of Pennsylvania, we have beautiful rolling countryside, farmland and a rural area, within a short distance of the center cities that make up the heart of my district. Many people are quite justifiably concerned about the sprawl that is going on; the development that is extending ever further outward; the congestion that arises as a result of that; the diminution of the quality of the countryside as these developments have gone on. What we have is we have a Tax Code that encourages that. In some ways, the Tax Code forces that kind of development because just as the gentleman points out, it is an economically rational decision in many cases, not a decision a farmer wants to make but an economically rational decision, given the Tax Code, to sell that farm, even though he would much prefer to pass it on to his children. To sell that farm, who is the likely buyer of a farm? It is going to be a developer.

Mr. TOOMEY. During the course of a working person's lifetime, the person pays tax on their income. If there is a little money left over from that and you save it or invest it, you pay taxes on dividend or interest. If you have a capital gain because an asset appreciates in value, you pay a tax on that. If you still manage to have something left over after all those taxes are paid at the end of your life when you die, the government comes in and takes more than half of that. I think to most Americans that is absolutely unreasonable and unfair to have that many layers of tax on the same income, the same savings. But nevertheless that is what we do. What are the ramifications of that? They are extremely negative. One example that is all too common is that small businesses, farms, they might grow to the point where there are assets that are substantial, they may be several million dollars, but very frequently they are not cash, they are not in the form of securities. They are not liquid assets that are available to pay bills. They are investment in plants, in equipment, in factories, in land, in very tangible real property but property that is not liquid. When suddenly the government comes in and says we are going to assess the value of this entire operation, and we want more than half of it now, that forces the heirs to that person's family business or farm to make some very, very difficult and sometimes devastating decisions. Often they have to sell the entire thing to generate the revenue to pay the tax bill. Sometimes they have to sell portions of it. Sometimes, Mr. Speaker, a family is forced to take on a huge amount of debt to pay the tax bill, continue to try to operate the business now with this huge debt that has saddled them and sometimes they have to lay off workers, sometimes they have to cut back on their workforce in order to afford the service on the debt. The point is the Tax Code should not be driving that kind of decision. It should be the economics of the operation that determine whether you sell the operation, take on debt, not a Tax Code that says it is time for the government to take half of their value. That is the kind of devastating impact it can have. It can force farmers to sell their farm, it can force small businesses out of business altogether, and it can force small businesses to have to take on a mountain of debt which their business may not be well equipped to handle. It can have all of these unintended consequences, all in the name of trying to confiscate a person's savings at the occasion of their death. So it is important to remember that this is not just a tax that penalizes those people who chose to be frugal and to save and invest and accumulate an asset over their life, but also they are employees; the contribution that business makes to the community; the revenue that is derived from people who provide goods and services to that business; the ramifications spread out from there, and they do much harm.

Mr. TOOMEY. I know of a number of cases and circumstances in which the effect is devastating. An important point to remember is that the death tax which the gentleman is referring to, which is the tax whereby at the occasion of a person's death the government comes in and confiscates up to 55 percent of everything that person has left over, let us step back and remember that whatever a person has left over is left over after multiple layers of taxation were already paid.

Mr. TOOMEY. One of the best things that I think government could do for business is get out of the way. We share several things in common, one of which is our historical involvement in the restaurant industry. My brothers and I have been in the restaurant industry, I no longer am, but for many years we were in this business, having started a restaurant business from scratch. The regulations are extremely onerous; but even more onerous from my point of view was the tax burden and the Tax Code, both obviously visited upon business owners by the Federal Government. To give my colleague an example, or to put it in perspective, I think of the restaurant business in many ways; it is a simple business. You go out, you buy food, you cook it, and you sell it. It is not terribly complicated. But every year at the end of the year when it comes tax time, I have to hire an accountant and pay a great deal in fees for the accountant to go out and calculate what our tax obligation is. What he sends back to me, or what he used to when I was an owner of these restaurants, would be a stack of documents at least an inch high with instructions to fill out a check for a particular amount, sign the form, send it in and hope for the best. That is what small business owners do every day. There is no reason for that. There is no justification for a Tax Code that is too complicated to understand. There is no justification for a Tax Code that rewards and punishes people with their own money based on whether they behave in a fashion that is approved of by politicians. This is not the way we ought to be doing things. Part of what we need to do is move on and provide meaningful simplification of our Tax Code and more fairness in our Tax Code. When I talk to the people who are still in small businesses back in Lehigh and Northampton Counties and Montgomery County in Pennsylvania, the folks across the Upper Perkiomen Valley and the Lehigh Valley who are creating all those jobs, what they tell me is, Give us some room. Just step back, lower our tax burden, lower the regulatory burden and we will be fine. These folks are not looking for a gift; they are not looking to be given anything except the opportunity to go out and run their own businesses as they see fit. I think they deserve that.

Mr. TOOMEY. Certainly.

Mr. TOOMEY. Mr. Speaker, I would like to thank the chairman for his leadership. And advocating for small businesses, the gentleman understands very well the critical role that small business plays in our economy, that small business plays in our entire society. I am sure he is well aware of the fact that small businesses have in recent years created 80 percent of the new jobs in America. It is very hard to overstate the importance of small business, and so it is fitting that we recognize small businesses this week. I just want to recognize and commend him on his leadership, the hearings that he has held and the attention that he has focused on finding ways that the government can relieve the burden that government imposes on those people creating these jobs and really contributing so much to our economy. I wanted to speak in particular about why today is a big day for small business owners across America and not just small business owners but every single person who is employed by a small business, the people who provide supplies and services to small businesses, the communities that derive tax revenue from small businesses and suffice it to say our entire economy and that is the budget resolution that we passed today. One of the highlights of the budget resolution is the tax relief that is contemplated, it is allowed for by this budget resolution. It is modest tax relief. If you look at it in any historical standards, it is quite modest. If you look at it compared to the size of our economy it is quite modest; but it is important because it is significant, it is across the board, it will provide tax relief for all tax-paying Americans, and it is the most significant tax relief in a generation. Why is it so important? There are a number of reasons, but let me focus on one in particular. The tax relief that we voted to allow today with our budget resolution, if enacted, which I believe it will be and I am sure the President will sign it into law, it is going to lead to economic growth and prosperity. It is going to increase the economic output of our country, and that means productivity of our workers is going to rise, that means workers' wages will go up, that means standards of living will improve and that means a better quality of life for all Americans. That is why this is a big day, not just for small businesses really but for everybody, but especially for small business. Part of what is going to help small businesses in particular is lowering of the marginal rates of taxes. As the gentleman knows, many small businesses, probably most small businesses in America, are taxed using the personal income tax rates, especially those that choose a subsection S designation, which is to say most, they are subject to personal tax rates. When we lower the tax rate that that small business is going to pay, we increase the incentive to work, to save, to invest and to grow that business. Now, the fact is the majority of people in America are going to get up and go to work every day whether or not we lower taxes. That is a fact. But growth occurs on the margin; and many small business owners have flexibility, they have a choice, they have a decision to make. Should they put in extra time, extra work, more effort, more risk, more of their capital at risk, expanding their business, growing their business, should they do that? Or should they spend that marginal savings, time, energy doing other things, spending it with their families, spending it at leisure, spending it doing something else? If you think about it, when we increase the rewards that that small business owner is going to be able to take home by lowering the amount of money we confiscate from him in the form of taxes, when we increase the rewards for working and saving and investing, people choose to do more working, saving and investing. Every single time in our Nation's history that we have had significant across-the-board tax relief, we have seen a corresponding increase in economic activity and economic productivity, in growth and prosperity. That is what is going to happen when we finish through this process and we enact the tax relief that is contemplated by this budget. I am convinced if we continue on this path and we follow through with this budget resolution and we provide this tax relief, and frankly I hope that this will be a floor, not a ceiling, in terms of tax relief, there are many important elements that we could include, that we could add to the tax relief that was proposed by the President, I hope we will because we should, if we do that, we are going to increase the rewards and we are going to increase the incentives and we will see a corresponding increase in the output of economic activity, and that is higher wages, higher standards of living, greater economic growth. That is what this is all about. It is going to give people the opportunity to develop and accumulate capital which gets invested in this economy and really leads to all good things and continued growth in the tremendous engine of growth for our economy which small business has been. I am delighted today to recognize the contribution small businesses make to our economy, to our prosperity, and to recognize also that the budget resolution we passed today is going to help everybody who is an owner, an employee, a provider of services or products for small businesses. That is a big step forward for all of them.

Mr. TOOMEY. Right.

Mr. TOOMEY. It is a question of timing, which is not terribly important to the Federal Government but it is incredibly important to the small business operator who in the example the gentleman just presented is forced to pay a huge tax bill on income that he has not collected yet. Is that correct?

Mr. TOOMEY. It is really a question of timing, is it not, in terms of the Federal revenue on the taxes?

Mr. TOOMEY

Mr. TOOMEY. Mr. Speaker, first of all, this is a very fair and standard rule that is going to allow us to have a substantive debate on the budget, and I certainly hope all of my colleagues will vote ``yes'' to pass this rule, because then we can get on to the substance of the budget itself, and it is a terrific budget that we have before us today. First of all, as all of my colleagues in this Chamber know, Mr. Speaker, we have walled off the Social Security and Medicare surpluses. We are devoting over $2 trillion in the next 10 years to paying off all of the available national debt. We have responsible restraints on the growth of Federal spending and, at the same time increasing, where it is appropriate, such as in health care research and the national defense, which badly needs an increase. Best of all, from my point of view, this budget provides the framework for providing meaningful tax relief from the record high taxes that are being carried by the American people. Frankly, it is modest tax relief. Certainly, if we look at it historically, certainly, if we put this in the context of the size of our economy, this is modest tax relief; but it is very important in that it is tax relief for all taxpayers. It is still the most sweeping tax relief of a generation. Frankly, Mr. Speaker, this tax relief is about freedom. It is about the question of who is going to get to decide how to spend that marginal dollar they earn, the American people who earn it, or politicians in Washington who would like to hoard that surplus tax money and spend it themselves. I am going to be voting for the American people on this one. It is also about economic growth because when we lower marginal tax rates, when we eliminate the death tax, hopefully lower capital gains rate and eliminate a number of other tax reductions, we will take an enormous step forward in providing long-term prosperity for our Nation. Every single time in American history that we have had sweeping tax reduction, we have seen a corresponding acceleration in economic growth and activity. The economy accelerates, take-home wages go up, productivity rises, living standards rise. There is no coincidence; there is no mystery as to why this happens. It is simple. When we increase the rewards of working and saving and investing, we increase the incentives to work and save and invest, and when we increase the incentives, we get more work in savings and investment. That is why this tax relief will help to spur economic growth, that is why it is so good for the American people, and that is why we should adopt the rule and the budget.

Mr. TOOMEY

Mr. TOOMEY. Mr. Speaker, I want to thank the gentleman from Ohio for yielding me this time. Mr. Speaker, I rise today to urge my colleagues to pass H.R. 974. This is a bill that contains a number of very good, sensible provisions. As we have heard, it will allow the Federal Reserve to pay interest on sterile reserves; and we have heard that it will give flexibility to the Federal Reserve in setting reserve requirements which in turn will help in maintaining our monetary policy. This bill also includes language from H.R. 1009 which I introduced to allow banks to pay interest on commercial checking accounts. Now, as we all know and we recall from last year, we passed sweeping modernization legislation, modernizing the legal framework within which the financial services industry is regulated. It was historic legislation. We repealed antiquated laws that dated back to the Depression. But we missed one, we might have missed more than one, but one that we missed was repeal of the prohibition on interest on corporate checking accounts. So today we are going to take that up, among other things. Let me address that specifically as a part of the bill that I had focused mostly on. First of all, repealing the prohibition on interest on business checking is not really for big banks. Oh, it will apply to big banks but as a practical matter, big banks, large, sophisticated financial institutions have the means to circumvent this prohibition and they have done so for years, quite legally, quite appropriately. Through a very sophisticated series of transactions, they can offer implicit interest if not explicit interest. This really is also not for large corporations. As the gentleman from Alabama mentioned earlier, large corporations have ways around this as well. They have sophisticated Treasury operations. They have the ability with extensive full-time staff to make sure they do not have idle cash sitting there not earning interest. What this legislation is really for is small banks and small business. It is for small banks that do not have the means to develop ways to circumvent the prohibition. It will allow them simply to directly pay the interest that they want to pay so that they can compete with the larger institutions and can attract deposits. And it is for small businesses, small businesses that do not have the resources to have a Treasury operation. They do not have the manpower to devote countless hours to making sure there are no idle reserves. What this bill is going to do is it is going to allow those small businesses which struggle so much to provide so many jobs and so much of the vigorous growth in our economy in recent years, it is going to allow them to be a little more competitive and give them a little bit more of a break by allowing them to earn interest on the deposits that they own. It is quite appropriate also as the gentlewoman from New York pointed out that there is no mandate in this bill. This simply allows business and banking institutions to decide amongst themselves without the prohibition of government to decide how much if any interest will be paid on these accounts. But I am confident that market pressures being what they are will develop an habitual interest for these balances as ought to be the case. It is long overdue. I think we are getting to the point where we are going to pass this legislation. I am hopeful that the other Chamber will do likewise. I just want to thank the chairman, the gentleman from Ohio (Mr. Oxley). I would also like to thank the gentleman from Pennsylvania (Mr. Kanjorski) and the gentleman from Alabama (Mr. Bachus) for their leadership in this effort as well as the ranking member, the gentleman from New York (Mr. LaFalce). I urge my colleagues to pass this legislation.

Mr. TOOMEY

Mr. TOOMEY. Mr. Chairman, I thank the gentleman from Arizona (Mr. Flake) for yielding me this time, and I want to congratulate the Republican Study Committee, the staff of the Republican Study Committee, and the gentleman from Arizona for his leadership in putting together an extremely responsible, progrowth, protaxpayer budget that is something that we all ought to be able to support. Let me step back and remind my colleagues. It was a little over a year ago, at the time he was candidate George Bush, that our now President proposed a tax relief plan of about $1.6 trillion, out of what was then expected to be about a $3 trillion surplus. Since then two big things have changed: The surpluses are obviously going to be much larger than that. The consensus estimate is now at least $5.5 trillion in surpluses. The other thing that has changed is the economy has clearly weakened. We need to do more, we can do more, and the budget that we are talking about right now, the Republican Study Committee budget, accommodates a broader, faster, more helpful tax relief package. That is what we need to do. This budget is very responsible. In fact, it is a modest tax relief package. It is only 7 cents of every dollar that is scheduled to come to Washington. It is less than 40 percent of the combined surpluses. It is much smaller than the tax cuts of the 1980s. It is smaller even than the tax cuts that President John F. Kennedy put through in the early 1960s. What we do is we take President Bush's plan and phase it in faster under the Republican Study Committee's budget. We cut marginal income tax rates retroactively to January 1 of this year. We take other elements, and we introduce them into this tax relief package, like allowing families to put more money into IRAs; like repealing the 1993 tax increase on Social Security; like phasing out the alternative minimum tax and fully eliminating the marriage penalty. Those are things we need to do, and this budget would allow us to do that. Let me address the issue of the certainty of the surplus. This has come up many times, and we just heard the previous speaker mention this. Nobody knows for sure exactly how large a surplus can be, but the fact is these are extremely conservative estimates that have been used. The fact is that for the last 3 years every revision has been an upward revision. The fact is we are not helpless victims as to whether or not there is going to be a surplus. We know how to make sure we have the funds available. We are not helpless victims waiting to see whether there is a surplus, as though it were a storm rolling up the eastern seaboard. We know how to make sure this happens: Reduce excessive taxes so the economy can prosper, like it has done every time we have lowered taxes, and control spending. If we do that, there is more than enough money. And we can do that. This budget calls for that. It also provides the freedom and fairness that we as representatives of the working people of America ought to do. I want to congratulate all my colleagues on the Republican Study Committee that put this budget together, and I urge my colleagues to vote in favor of this alternative budget resolution.

Mr. TOOMEY. Mr. Chairman, let me just reflect on what the overall effect on this budget does. It increases spending, but it does it responsibly, not massively, as the Democratic alternative would. It takes all the Social Security and surpluses and puts that aside. It retires all the available debt. Now, after we have increased spending, put all of the Social Security and Medicare money aside, paid off all of the debt, how could we not provide tax relief with the money left over? I have heard my colleagues suggest that the tax package is unfair. Our tax package is the relief for everyone who pays income taxes. Now, does that go back to people in proportion to the taxes they pay? No, a more than proportionate share goes to the lowest-income workers. People making $35,000 a year, a family of four, would pay no taxes at all. There is no question this disproportionately benefits the people at the lower end of the income spectrum. Finally, the biggest and best reason we should be supporting the Republican Study Committee budget is the effect it will have on the economy, the ability it has to unleash economic growth and prosperity. That is what this is all about. The empirical evidence is overwhelming: Every time in American history everywhere around the world when societies lower the burden that government imposes on an economy, when societies lower the tax burden, the taxation and litigation and regulation, those kinds of burdens, the result is economic growth and prosperity. That means more jobs, higher wages, greater productivity, rising standards of living. That is what we are here for. That is what our obligation is as representatives in Congress, to provide that opportunity for the hard- working men and women across America to enjoy their dreams, enjoy the fruits of their labor. That is what our budget does better than any other budget. I urge my colleagues to support the Republican Study Committee budget.

Mr. TOOMEY

Mr. TOOMEY. Madam Chairman, I thank the gentleman for yielding time to me. I would like to respond to this issue of the debt, which is hard to do with a completely straight face after decades in which the Democrats were in control of this Chamber and the other body, and routinely, year after year, there were no surpluses. The money was spent. Social Security surpluses were spent. The debt was run up. Republicans come along, balance the budget, start paying down hundreds of billions of dollars in debt, and put forward a plan which over the next 10 years retires all the available debt, and then we hear that suddenly, somehow, that is not enough. Let me explain something: There is a limit to how much and how fast we can pay down the debt. The numbers that my colleagues on the other side are talking about, I am sorry to say this, but it is just not possible. I would remind them that we have billions and billions of dollars worth of Treasury securities that extend beyond 10 years. Unless they intend to pass a law that would somehow force people to turn in a debt which they own now, bonds which are in their hands, which we cannot do, it is simply not possible.