thank you, madam president. i want to thank also my colleague from north dakota, senator hoeven. thank you very much. a senator: mr. president? the presiding officer: the senator from north dakota. mr. hoeven: madam president, i rise to speak on the need for pro-growth tax reform rather than a tax increase. president obama's proposed raising taxes. he says we should raise income taxes on individuals and small businesses, that we should raise capital gains taxes on investments and that we should raise the estate tax, meaning raise the death tax on american families. for example, take the estate tax. you've got a farmer right now. he wants to pass his farm on to the next generation for any

value over $5 million he has to pay estate tax. generally, families may be able to do that, may be able to borrow the dollars required and pass the family farm on to the next generation. but under this proposal, that changes instead of paying estate tax on anything over $5 million, now that farm family would have to pay estate tax on anything over $1 million. so think about a farmer in my home state of north dakota or maybe in minnesota or anywhere throughout the midwest. now, how do they pass on that family farm when they're going to have to pay taxes on any value over $1 million? so now they're looking at a situation where they're going to have to sell that farm rather than have their children continue farming an operation that may have been in that family for generations. that's a real problem for our farmers and for small business, for families across this great

country. and it's certainly not going to help our economy. in fact, it will hurt our economy. the president himself has said that we cannot raise taxes in a recession. he has said repeatedly that doing so would hurt the economy and would, in fact, hurt job creation. so let's review our situation right now. our situation right now is that we have 8.2% unemployment. we have more than 41 months where unemployment has been above 8%. we have 13 million people out of work. and we have another 10 million people who are underemployed. so you're talking about 23 million people in this country that are either unemployed or underemployed. middle-class income since this administration has taken office has declined on average from approximately $55,000 to $50,000. food stamp use, food stamp recipients have increased from

32 million recipients when this administration started in office to 46 million food stamp recipients today. home values have dropped on average from $169,000 to $148,000. the economic growth, economic growth in this recovery is the weakest of any recovery since world war ii. last quarter, our growth was 1.9% versus the prior quarter, 1.9%. job creation last month, 80,000 jobs, but it takes 150,000 jobs gaining every month just to hold even with our population growth, just to start reducing that 8.2% unemployment rate. so the facts, those are the facts. they speak for themselves. you can draw your own conclusion. the president's approach to our economy is making it worse.

his fallure to join with us in extending the current tax rates and engage in pro-growth tax reform rather than raising taxes is sitting on our economy like a big, wet blanket. but we can change that. we can change that right now. we do it by extending the current tax rates, the tax rates that have been in effect for ten years. by extending the current tax rates for a year by engaging in comprehensive, pro-growth tax reform and also, of course, by getting control of our spending. business investment and economic activity would respond immediately. look at the latest information from the congressional budget office. now, the c.b.o. projects that the economy will contract, will contract by 1.3% annual rate for the first six months of next year if the fiscal cliff is not

addressed, meaning the current tax rates which go up at the end of the year unless we address this, an increase in taxes and the sequestration. now, if those things are addressed with the approach that we put forward instead of an overall .5% growth next year, you're looking at 4.4% growth for our economy. those are the c.b.o.'s statistics. think of the difference, think of the difference that would make for those 13 million people who are looking for a job. and it just stands to reason because business needs certainty to invest, to grow and to hire people, not higher taxes. and with legal tax and regulatory certainty, businesses in this country would invest. right now, there is more private capital on the sidelines than any time in the history of our

country. private investment capital that businesses would otherwise invest and get this economy growing and get people back to work is sidelined because of the regulatory burden, because of the government spending and the deficit and because of plans like this to raise taxes. it is that situation that is sidelineing private investment and private capital. that means slower economic growth. that means higher unemployment, that means more people without jobs, that means less revenue to reduce our deficit and our debt. so clearly, raising taxes is not the way to go. but president obama says well, wait a minute, everybody needs to pay their fair share. well, everyone needs to pay their fair share. well, of course everyone needs to pay their fair share. but the way to do it is with pro-growth tax reform and with

closing loopholes, and that's exactly what we have proposed, not raising taxes on more than one million small businesses in this country, the very job creators in this country, as the president has proposed. let's take a look at the tax rates for just a minute. we have talked about this. let's look at these tax rates. according to the national taxpayers union, for the tax year 2009, the top 5% of taxpayers paid almost 60% of the tax. one more time, the top 5% of taxpayers paid almost 60% of all the income taxes paid. the top 10% paid 70% of all income taxes and the top 50% paid 98%. the top 50% of taxpayers paid 98% of all income taxes. so what we're proposing is pro-growth tax reform, closing

loopholes. let's extend the current tax rates for one year and set up a process to pass comprehensive pro-growth tax reform that lowers rates, that closes loopholes, that's fairer, that's simpler, and that will generate revenue from economic growth rather than higher taxes. the reality is that along with controlling government spending, that's the only way we're going to balance our budget, that's the only way we're going to get on top of our deficit and our debt, and that's the only way we're going to get these 13 million people back to work, because that's how this american economy works. when we estimate late that private investment -- when we stimulate that entrepreneurial activity, that small business across the country that has made our economy the envy of the world. to be successful, this effort has to be bipartisan. we have to join together in a bipartisan way to make it happen. so let's get started. let's give small business in this country the legal tax and

regulatory certainty, the business climate the environment they need to encourage private investment and innovation and job creation. that's the american way. that's the real american success story. and we can do it. we nd to get started and we need to make it happen now. thank you, mr. president. with that, i yield the floor. a senator: mr. president? the presiding officer: the senator from virginia. mr. webb: mr. president, i would

like to take some time this morning to talk about some recent events in asia that i think would -- but before i do that, i would like to clarify my position on the vote that we are going to be taking this afternoon. first, i want to emphasize that i agree with all those comments that have been made by my democratic colleagues about needing to keep tax cuts in place for our lower income workers, our middle class. i just happen to believe that we need to keep them in place for everyone who is making their income through what we call ordinary earned income. earned income, ordinary earned income is the strongest indicator that a person in this country is actually accumulating wealth, which is the american

dream. it's not necessary that you have wealth, whatever the amount may happen to be. passive income, which is income from capital gains such as investment in stocks, dividends, is one of the best indicators that you actually have accumulated a certain amount of wealth. you have enough money to set aside and invest it. my long belief has been that if we're going to raise taxes on income, in addition to these other things that we have been talking about with respect to tax loopholes and subsidies and those sorts of things, that you really ought to be doing so in the fairest place, and the fairest place is from passive income, not ordinary earned income. and i have said since the day that i announced for the united states senate years ago that i

will not vote to raise taxes on ordinary income of any amount. i gave a rather detailed set of floor remarks several months ago about this issue. i just wanted to share this particular chart with my colleagues today before i begin speaking on the situation in the south china sea. this shows sources of income for the top 0.1%. we keep talking about these people at the top who aren't paying their fair share. well, two-thirds of the money that is being made by the top 0.1% in this country, and that's 140,000 taxpayers, is being made from passive income. it's being made from capital gains and dividends which are taxed at a much lower rate than ordinary income. right now, 15%. so in addition to fixing a

larger tax code, i would just like to say again to my colleagues this is the area where we really should have the courage to make some decisions. i was reading an article in "the economist," this week's edition, pointing out that american profits, corporate profits as a percentage of g.d.p. are actually higher now than they were at the high point before our economic crisis. in other words, corporate profits have gone up to a point that they are now about 15% of our g.d.p., at the same time that our wages have stagnated and gone down. they make one point in here where they said there is an irony that a high share of g.d.p. for profits automatically results in a low share for wages. why? because the people who are

making the money, by running these companies, these executives are selling their stocks, their stock options, taking the lower percentage on capital gains in order to make their money. so i am not going to vote for raising taxes on ordinary earned income, but again i will renew my suggestion to this body that we take a good, hard look at this because this situation is creating the greatest disparity among our people. mr. president, for many years, since well before i came to the senate, i have had the -- the pleasure to work, travel inside east asia in many different capacities. as a marine in okinawa, in

vietnam, as a journalist, as a government official, as a guest of different governments, as a filmmaker, as a business consultant. and what we have been able to do, i think, in the last five or six years to refocus our country's interests on this vital part of the world is i think one of the greatest success stories of our foreign policy. but at the same time, we have to always be mindful that the presence of the united states in east and southeast asia is the guarantor of stability in this region. if you look up here at the korean peninsula, we will see that for centuries there has been a cycle where power centers have shifted among japan, russia, and china. this is the only place in the world where the geographical and power interests of these countries intersect and they

intersect with the korean peninsula being in the middle of it. and we saw earlier, actually the middle of last century, we saw what happened when japan became too aggressive in this part of the world. the japanese fought russia in the early 1900's, they defeated them. this is when they moved into korea, occupied korea, moved into china. this resulted in our involvement in the second world war, and since the second world war, our presence has been the guarantor of stability. we've seen blowups, the korean war where we fought china in addition to north korea, the vietnam war, in which i fought. but generally, the long-term observers of this region, people like the minister of singapore will say the presence of the united states in this

region has allowed economic systems to grow and governmental systems to modernize. we have been the great guarantor of stability. the difficulty that we have been facing in the past ten to 12 years has been how to deal with the economic and international growth of china in this region. before china's expansion when i was in the pentagon in the 1980's, we had seen the reemergence of the soviet union. when i was in the pentagon at that time on any given day, russia's dream of having warm water ports in the pacific had been realized for they would be -- have about 20 to 25 ships in cameron bay, vietnam, as a result of the vietnam war. but for the past 10-12 years the

challenge for us has been to develop the right sort of relationship with china so that we can acknowledge their growth as a nation but maintain the stability that is so vital in this part of the world. the last few years have been very troublesome. there have been a number of issues out here in the south china sea that for a long time our military leaders assumed were simply tactical engagements where chinese naval vessels and fishing vessels would be involved in spats with the philippines off the coast of vietnam, but it became very clear and also in the islands near japan, became clear what we're seeing are sovereignty issues. people were talking for many years about solving the situation in taiwan, the sovereignty issue in taiwan and it was clear, i was speaking about this for many years, there are other sovereignty

issues. once taiwan is resolved. the sinkaku islands which china and japan both claims, the separateleys which are claimed by five -- sprattley's which are claimed by china and the philippines. so we started seeing a resurgence of incidence that became military confrontations over the past couple of years. our secretary of state, this administration, was very clear two years ago, almost to the day, that these situations were not simply asian situations, that they were in the vital interest of the united states to be resolved peacefully and multilaterally. we've been struggling on the foreign relations committee to try to pass the law of the sea treaty where these sorts of incidents which, by the way, are more than security incidents, they involve potentially an enormous amount of wealth in this part of the world.

we've had a very difficult time getting a law of the sea treaty passed, where most of the countries around the world recognize the basic principles of how to resolve these international issues through multilateral involvement. in the absence of a law of the sea treaty, and i think with the resurgence of the chinese, a certain faction of the chinese tied to their military, china has become more and more aggressive. this past month has been very troublesome. on the 21st of june, china's state council approved the establishment of what they call the sansha pretectural zone. this is literally the creation from nowhere of a governmental body in an area that is claimed

also by vietnam. unilaterally. on friday, july 13, because of disagreements over how to characterize the south china sea situation, a -- aseen, the association of southeast asian nations failed to issue a kuhn akay about the south china sea issues, the multilateral resolution of the issues. on july 22, the central military commission of china announced the deployment of a garrison of soldiers to the islands in this area. the guerin son command will likely be placed in the parasel islands, right here, as i say, claimed by vietnam within the economic -- executive economic zone of vietnam. -- exclusive economic zone of

vietnam. july 23, china began implementing this decision. it announced 45 legislators are now to govern the approximately thousand people who are occupying these islands. they've elected a mayor and a vice mayor. they've announced that a 15-member standing committee will be running the pretecture. they've announced that this city that they are creating will administer more than 200 islets, sand banks, and reefs covering two million square kilometers of water. in other words, they have created a governmental system out of nothing, they have populated and guerin sonned -- garrisoned an island that is in contest in terms of the sovereignty and they've announced that this governing body will administer this entire

area in the south china sea. china has refused to resolve these issues in a multilateral forum. they claim that these issues will only be resolved bilaterally, one nation to another. why? because they can dominate any nation in this region. this is a violation, i think quite arguably of international law. it is contrary to china's own statements about their willingness to work with asean to develop some sort of code of conduct. this is very troubling. i would urge the state department to clarify this situation with china, and also with our body immediately. i thank the chair and i yield the floor.

quorum call:

quorum call:

quorum call:

a senator: mr. president? the presiding officer: the senator from kansas is recognized. mr. roberts: thank you, mr. president, for the recognition and i want to speak today to share my concerns over proposed changes in the estate and gift tax provisions of the current tax code. and that's going to be considered within hours here on the floor. like much of the tax code, the estate and gift tax provisions are terribly complex, costly to comply with, have very serious negative consequences, and these negative consequences i think disproportionately harm

farmers and ranchers and worry their lenders. visit with farmers and stockmen today, livestock producers, you better stand back. they are upset, they're frustrated, they're angry, they're concerned, and they're worried. all across farm country we are suffering from a severe drought which is a real emergency, historic in scope, and damage, and in particular for our livestock industry. congress should respond. at the same time, they are facing a farm bill that's in limbo, regulations that defy any commonsense cost-benefit yardstick, and no farmer or their lender can plan in this environment. there is no certainty. in farm country, there is no certainty. but just to split the shingle,

mr. president, now we have proposed changes to the current estate tax, the infamous death tax, if you will, all based, again, on a select few in washington deciding who is wealthy, what's a fair share people should pay in a tax and how you should pay that tax, playing, again, with the politics of envy and class warfare. i think we ought to quit this business. and the classic example is under current law the estate tax is set at 35% on estates over $5 million. if nothing is changed on january 1, 2013, or if you vote for a particular version of these two tax bills that we're going to be considering here in just about an hour and a half, if nothing is changed, the estate tax exemption will drop from $5 million to $1 million and the estate tax rate will jump from 35% to 55%.

mr. president, if we do not act to extend the current death tax structure -- i'd like to eliminate it, repeal it, but at least extend it -- the joint committee on taxation reports that over ten years, the number of small businesses subject to the death tax would increase from about 1,800 folks to 23,700 and the number of farming estates subject to the death tax would increase from about 9000 farmers and ranchers to 25,200. that's more than 20 times that would be hit with this massive death tax hike, a 2,000% increase. it's not just farmers and ranchers than that would be affected. nine times more small businesses would be hit with this massive death tax, 800 -- a 900% increase. 12 times for taxable estates would be hit, a 1,200%

increase. while i support permanently repealing the death tax, if we cannot achieve that goal, how we structure this tax in particular has immediate real-world implications for folks in kansas and across the country. the looming 2013 change to the estate tax law would be a huge disservice to agriculture because it is a land-based capital-intensive industry, few options for paying estate taxes when they come due. the current state of our economy coupled with the uncertain nature of estate tax liabilities makes it tremendously difficult for family-owned farms and ranches to make any sound business decisions. they're on the sidelines of our economy. they're not on the economic playing field. again, there is no certainty. obviously, raising the estate tax burden will strike a blow to

farm and ranch operations trying to transition from one generation to the next. a $1 million exemption -- that sounds like a lot, to some people in this chamber and obviously to some people within this administration, a million bucks, you're rich, you're wealthy. no consideration as to what the personal situation is for that individual, but somebody just determining what a fair share is. and then taking from that individual and redistributing to those that they think deserve it. but the $1 million exemption is not high enough to protect a particular farm or ranch able to support a family and when coupled with the top rate of 55%, that's going to be especially difficult if not impossible for farmers and ranchers and businesses to pass on there where with alto the next intention -- where with withal to the next generation.

yet it is in conflict with a desire to protect and reserve family-owned farms and ranches, individuals, family partnerships and family corporations own 98% of our nation's two million farms and ranches. when estate taxes on an agriculture business exceed cash or other liquid assets, many surviving family partners will be forced to sell land, buildings, or equipment needed to keep their businesses operating. with 85% of farm and ranch assets ill -- ill liquid, producers have few options when it comes to generating cash to general by the way, the estate tax. recent increases in agriculture land values on average 25% from 2010 to 2011, have greatly expanded the numbers of farms and ranches that top the estate tax exemption. how on earth can farmers,

ranchers, and small businesses even plan for this? in order to keep a farm or ranch, businesses operating after the death of the owner, families must plan for the estate tax. but under the majority party bill we will vote on shortly, many more farmers and ranchers will face increased filing, paperwork, other hassles in planning for succession. not to mention employers and c.p.a.'s and estate planners. in fact, if we don't extent the current estate tax the estates required to file paperwork with the i.r.s. rise from about 8,600 to 107,500. that's a lot of time and cost that could be avoided. the planning costs associated with this tax are not only a drain on business resources but also take money away from the day-to-day operations and investing in the business. even with planning, uncertain

tax law combined with changing land values and family situations make it impossible to guarantee that an estate plan will protect a family farm or ranch. this not only can cripple a farm or ranch operations but it hurts all throughout all of our rural communities up and down main street, every business that agriculture supports. the death tax is one of the worst offenders in bringing real complexity to the tax code. and i believe it is one of the most distortive provisions in our system. now, some -- some believe and will point out that the estate tax is an instrument of social justice, that it is designed to limit wealth accumulation and to spread that wealth around. something i think that is contrary to what this country is all about. why do you work?

you work hard to make a difference and you work hard because you enjoy the work and hopefully you get paid for it and hopefully get paid enough that you can at least have enough wherewithal so that your kids and their kids can continue that kind of endeavor if they so choose. but some people say we want to spread that wealth around. even if you hold that i consider a socialistic view -- tough word, it's a pejorative, i know, but i think that applies here -- the estate tax which distorts no end of economic decisions isn't the most efficient method to redistribute the wealth. if you are a wealth redistributor, if you will, in this body, clearly taxpayers responding to the death tax cut back, consume more of the capital, consuming the.

the disincentives the death tax creates in the end leads to fewer jobs, less savings. how do you redrb that? there's nothing to redistribute. in a troubled economy this forced outcome just does not make sense. mr. president, being able to plan for the future is critical. the current uncertainty leads to the repeated provisions of wills and trusts which burdens advisors and taxpayers alike. over and over again, i don't care what farm organization you're talking about, what commodity group, what business group, what small business group, wherever you go in my state of kansas and i think it's the same in regards to other states that members here are privileged to represent, over and over again i've been asked again what congress will do with these provisions. what should a rancher do? how can they pass farms on to their children? i have even been asked for planning purposes -- i'm not making this up -- if this is a goodyear to die.

that's asounding if not outrageous. it may be a good year to die because this egregious change is going nowhere. these two bills we are considering here in just a few moments, they're not going anywhere. we will vote on it in a little while but it's subject both to a point of order, not having originated in the house. they will be blue slipped. that's a fancy word, it's a parliamentary word saying they're going nowhere because bills on taxes have to originate in the house. talk about a real income redistribution nothing burger. that's what we're considering. but it is indicative of what is being considered in this chamber and indicative of what we have to take care of in true tax reform. now, folks in kansas should not have to make such important decisions on the tax law that's changing all the time. we need to repeal the death tax. if this tax cannot be repealed,

it needs to be set in stone, hopefully not a grave stone and not a rate and in a manner that provides certainty. now, while it's important -- what's important to permanently eliminate this very punitive tax, until this can be accomplished, congress should at least extend the current $5 million pemghts he exemption indexing it to reflect land values and spousal transfer and maintaining the top 35% tax rate. finally, mr. president, we pay taxes all of our lives. it just doesn't make sense to be taxed again when we die. i suggest the absence of a quorum, although i note my colleague from illinois is perhaps ready to speak. and i will be happy to yield back any time that i have. mr. durbin: mr. president? the presiding officer: the senator from illinois. mr. durbin: mr. president, i thank my colleague from kansas for yielding. mr. president, in a short time we're going to vote on a tax measure that gives the united states senate a very clear

choice, and here's the choice. at the end of this year a whole battery of tax cuts that were enacted into law years ago will expire. december 31. and the question is what's going to happen next? if we do nothing, a very good thing will happen but also a very bad thing will happen. the good thing is this: if the taxes go up on all americans, virtually all americans for ten years, we will reduce our deficit by $5 trillion, more than any group has been able to suggest or come up with a plan to achieve in any of the meetings that we've been involved in. $5 trillion in deficit reduction. it's an amazing reduction. but, there's another side of the ledger. the other side of the ledger says if you start taxing families now while this economy is in recovery, it's going to slow down the recovery. well, that's natural. people have less money to spend, and many families, working

families living paycheck to paycheck will face a new hardship that they don't have today. they reduce their spending, the economy contracts and we see this recession hang on with high unemployment and businesses failing. so it really is a very faustian choice and difficult choice. reduce the deficit dramatically on one hand by letting all the tax cuts expire but run the risk of going into a deeper recession, maybe repeating what happened a few years ago which devastated our economy. so the president has said let's try to strike the right balance here. when all the tax cuts expire on december 31, let's focus on restoring the tax cuts for that portion of american families and workers who need a helping hand to continue, but let's not go all the way. let's not restore the tax cuts for those in the highest income

categories. and so the president says we can have both. if you follow my plan, we will reduce the budget deficit because we don't give tax cuts to the wealthiest. and still in all, we'll help working families and we'll keep the economy moving forward. he tries to strike that balance. and the balance he strikes is at the income level of $250,000. so everyone will get a tax cut on the first $250,000 of income, even millionaires, but not beyond that. the republicans have a different approach, and they'll offer an amendment. extend all the tax cuts for everybody, to the highest levels of income, well beyond $250,000. not just to the 98% of americans who make $250,000 or less, but 100%. everybody. well, their approach, by extending those tax cuts, will mean no deficit reduction. in fact, their approach would

add about $900 billion to the deficit compared to the president's approach. so they are really basically throwing a bucket of red ink on this conversation, saying we're prepared to add $900 billion to the deficit so that the top 2% of wage earners can get a tax break. but that isn't all. the republican approach which will be offered by senator hatch, the ranking republican on the senate finance committee, goes a step further. i don't understand this part of it. toepts extend the tax cuts -- he wants to extend the tax cuts to the highest income categories, mr. president, but then he very carefully excises, eliminates some of the basic tax breaks that working families use. let me be specific. the hatch bill, hatch-mcconnell bill -- senator mcconnell, the republican leader -- does not extend the earned-income tax credit, child tax credit provisions. and as a result, here's what

happens. the hatch provision which protects the wealthiest in america by saving their tax cut would increase the tax on 11 million working families in america who currently are able to deduct the college tuition expenses of their kids. so while the wealthiest in america will get a break all the way through with the hatch-mcconnell republican approach, 11 million american families will find their tax bills going up if they have kids in college. what kind of message is that? here are the students struggling to get through school, families incurring debt. we create a tax benefit to help those families get through, and the republicans say no, we're going to raise the taxes on 11 million working families. that isn't all. they also raise the taxes on 6 million other families, working families with three or miles-per-hour children, --

three or mother children by $800 million, a change they refuse to make and then turn around, they increase the taxes on families with children. the child tax credit currently in the law allows a break for families with kids. a helping hand because kids can be expensive. and this part of the tax code helps these families. so 18 million american families will see their taxes go up with the hatch-mcconnell republican tax approach that protects those at the highest level of income categories. i don't think that's sensible. i spent a lot of time in the last couple of years talking about this deficit. it's serious. i guess i come from the democratic side of the spectrum, the left side of the spectrum. that's what my values reflect and that's what my voting record reflects, but i'll tell you

this. this democratic senator understands deficits are for real. we cannot continue to borrow 40 cents for every dollar we spend, even for the programs i love, let alone the programs i'm not so crazy about. and so we've got to reduce spending. but you can't balance the budget with millions of americans out of work. we need to get this economy growing and moving forward and creating jobs. people working and paying taxes make this a strong country and start to solve some of our deficit problems just by virtue of the fact that they're working, paying their taxes and raising their families. and so when it comes to these tax cuts, let me tell you, i am passionate about making certain that working families get the break they need. pew trust did a survey, mr. president, last year. here's what they asked working families across america, a real basic question: if you had a family emergency and you needed $2,000 in 30 days?

could you get it? could you come up with 2,000 bucks if there is a major car repair or a pretty routine trip to the hospital or to a doctor's office? that can run into $2,000 in a hurry. a broken arm, or you consider the possibilities. they asked all the working families how many of you could come up with $2,000 in 30 days. half. half of the working families. it means the other half can't. it tells you how close to the edge many people are living. and that's why the president's proposal, the democratic proposal here that gives the tax cuts and tax breaks to the working families makes a difference. 98% of americans will benefit from the president's approach. 2% will pay more. 2%, i think, will pay their fair share. the republican approach means for a millionaire, a person making $1 million in a year -- and just quick math -- that's $20,000 a week in income, $1

million a year. the republican approach would give them a $250,000 annual tax break. at this moment in time when we're dealing with the deficit and we're calling on congress for more spending cuts and we're saying we've got to get it together as a nation. $250,000 a year in additional tax cuts for millionaires? i don't get it. i don't begrudge them their wealth. this country is based on successful people who have led us in business and so many other endeavors. but i also think those people, when you talk to them, are darned appreciative to live in this great country and willing to make it move forward. then they make the argument if you raise taxes on people making $1 million a year, you're going to hit a lot of the -- quote -- "business creators." we looked at that. 97% of small business owners are exempt if you draw the line at $250,000 of income.

97%. i'll concede there are professional corporations and "s" corps, investment fund managers, some accountants, lawyers and doctors, sure, they may be job creators. i don't doubt that. but are we really asking a great sacrifice from someone making $1 million not to get a tax break to the full extent that they did before? i think what we understand is if we're going to help the middle class and working families in america and we're going to move the economy forward, we need a sensible tax policy. i happen to be at -- in a school that maybe not all the democrats agree with. in the bowles-simpson commission i said the only way to get deficit reduction is to put everything on the table, including programs i think are critical, critically important for america's future. i think medicare makes a difference in the lives of 40 million-plus americans, and i want it to be there. and i know it's going to run out

of money in 11 years. think of that. if we don't do a thing here, get caught in political gridlock, the medicare program that 40 million americans-plus depend on is going to run out of money. what excuse are we going to come up with? there is no excuse. we need to sit, look at this program, make it work, make sure it's affordable for seniors. and we've got to do it syrian rather than later -- do it sooner rather than later. social security, you hear so much about social security. let's get the facts out. for at least the next 24 years social security is going to make every promised payment to every retiree in america with a cost of living adjustment. no questions asked. 24 years. you can't say that about many if any federal programs. but the 25th year we're in trouble. we have a dropoff in revenue in the social security trust fund and the payments would have to be cut 30%. if you're wealthy in retirement -- some people are --

the social security check is like a little extra dividend. but for some people it means whether they're going to get by another month and a 30% cut is unacceptable. we need to look at social security. it doesn't add a penny to the deficit but the social security trust fund needs to be stronger longer. we need a bipartisan approach to this. we did it 50 years ago. we can do it now. we need to sit down and make sure that it works. we shouldn't decide that this is out of bound. that's something we should consider. it won't be voted on today, neither medicare nor social security. we're just dealing with the tax side of this conversation. but i happen to believe all of these things need to be discussed. and when it comes to taxes, pretty basic on that. i want to make sure that working families have a tax code that helps them. last week we had a bill. think about this for a second. we had a bill on the floor of the senate, and here's what it said: currently the tax code creates incentives and rewards american businesses that want to

ship jobs overseas. american businesses that want to outsource and ship jobs overseas, the tax code says you'll pay less taxes if you send jobs away. that makes no sense at all. why would we reward the export of american jobs? why would we provide for the deductibility of moving expenses and other expenses related to moving your business out of america and hiring people in another country? so last week senator debbie stabenow of michigan, senator sherrod brown of ohio came to the floor and said let us eliminate the tax incentive to move jobs overseas and let's turn it around. let's create a tax incentive for businesses that want to bring jobs back to america. sounds right to me, doesn't it, that we're creating jobs in this country and discouraging them from going overseas. in the end we had all the democrats voting for it and only four -- four out of the 47 republicans.

four. not enough to break the republican filibuster. when we talk about a tax code, i not only want to help working families, i want to provide an incentive and reward for those good home-based american corporations that are trying to keep good-paying jobs right here in the united states of america. honest to goodness, if we want to tpwhaoubg a store and pick -- want to walk into a store and pick up a product and see made in the u.s.a., we better wake up. what is currently going on is unacceptable. this notion on the other side of the aisle that we shouldn't get in the way of business when they want to makeheir decisions, i may not argue with that premise, but i don't think you ought to incentivize it, subsidize it, provide something in the tax code to encourage it, particularly when it costs american jobs. but last week only four, 4 of the 47 republicans, would join us this that effort. so we came up short. this week we've got to get right twhe comes to our -- when it comes to our tax code in the

future and tax code for families across america. mr. president, one of the things that has worried me greatly as i consider the challenges facing families is their inability to provide for the kids and the way they want to. i think we all know the i ask unanimous consent that further reading be dispensed withs of raising children. we know some of the challenges they face after college. we have come up with an approach. a deduction of child education expenses for those who made it to that level of education, and then part of what some call derice civil obamacare says that families can keep their kids on their own family health insurance until those young men and women reach the age of 26. that makes sense. how many young people coming out of college today struggle to find a job and if they find one struggle to find a job with health care benefits? i can tell you many times i

would call my daughter and son after they got out of college and asked them about health insurance, and my daughter used to say, dad, i don't need that now. i'll get it later. i feel just fine. she never knew and i didn't know what tomorrow would bring. so if we're going to give peace of mind to families, let's make sure we think along the spectrum, the continuum. why would the republican proposal today want to raise taxes on families with children? raise taxes on some 18 million families across america, those with kids? if they could find room for a tax break for the wealthiest, shouldn't they be able to include those families with kids? they may not be the wealthiest, but they are in many cases the neediest, and they are in many cases the most important for our future. and yet the republican approach, the hatch approach, is going to raise taxes on middle-income families with children. that is something that we never should allow to owe skewer.

-- to occur. let me just say, this should be a simple vote for everyone across the political spectrum. we ought to agree on two things. first, would end to cut taxes for middle-income and working families. second, we should be responsible stewards of the federal budget, not leave a mountain of debt for our kids. giving tax breaks to the wealthiest people and adding $00 billion to our national debt to do it is not responsible. so let's take this vote and show the american people that we stand with them and their values. we stand for cutting middle-class taxes and putting our debt on a sustainable path for recovery. mr. president, i yield the floor and suggest the absence of a quorum. the presiding officer: the clerk will call the roll. nig quorum call:

quorum call:

whaquorum call:

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quorum call:

mr. reid: mr. president? the presiding officer: the majority leader is recognized. mr. reid: i ask unanimous consent the call of the quorum be terminated. the presiding officer: without objection, the majority leader is recognized. mr. reid: i now ask unanimous consent that at 4:00 p.m. today, the cloture motion with respect to the motion to proceed to s.

4312 be withdrawn, the senate adopt a motion to proceed to s. 3412, a bill extending the 2001, 2003, and 2009 tax cuts for 98% of americans and 90% of all small businesses. that the only amendment in order to the bill be a bill offered to the institute by senators mcconnell and hatch, which is identical to s. 3413, that the amendment not be divisible, that the time until 4:00 p.m. be equally divided between the two leaders or their designees. prior to vote on the mcconnell-hatch amendment, that upon disposition of the mcconnell-hatch amendment, the senate proceed to vote on passage of the bill as amended, if amended. that there be no motion or points of order or amendments in order to the amendment or the bill, that there be two minutes equally divided between the votes. finally, mr. president, that when the senate receives a companion bill from the house providing for the extension of tax cuts as designated by the majority leader, it be in order for the majority leader to proceed to its immediate consideration, strike all after the enacting clause, and insert the text of s. 3412 as passed by the senate in lieu thereof, that

the house bill as amended be read a third time, the statutory paygo amendment be read if needed, and that the amendment be passed with no interconvenienting action or debate. the presiding officer: is there objection? mr. mcconnell: reserving the right to object. the presiding officer: the republican leader. mr. mcconnell: i would ask unanimous consent that the strike the last paragraph, and that a second amendment, the text of which will be at the desk and is the president's small business tax hike. further, that it be considered under the same terms of my amendment and that after the vote on that amendment, the senate proceed to a vote on the mcconnell-hatch amendment as the original request provided for. the presiding officer: is there objection? mr. reid: mr. president, reserving the right to object. the presiding officer: the majority leader. mr. reid: mr. president, the president's bill is the one just before this body that i asked consent on. we have a statement of administrative policy. it's the president's bill, the one we vote on.

i respectfully object to my friends -- friend's suggested modification. the presiding officer: objection is heard to the modification. is there objection to the original request by the majority leader. mr. reid: mr. president, mr. president? the presiding officer: the majority leader. mr. reid: my friend has objected to the last paragraph in my request and he's asked consent to add a third provision, i have objected to the third provision. he has objected to the last paragraph. i would be willing to renew my consent minus the last paragraph, which begins with the word finally and ends with the word debate. the presiding officer: is there objection to the new unanimous consent request? without objection, so ordered. mr. reid: so, mr. president, the vote will occur at 4:00 today on these two amendments. i appreciate very much the republican leader allowing us to arrive at the point where we are. i would tell everyone that the

time until 4:00 is evenly divided, approximately an hour for each side. mr. reid: mr. president, i would ask unanimous consent that if there is a quorum call between now and 4:00, that the time be equally divided between the two sides. the presiding officer: without objection. so ordered. mr. reid: i would note the absence of a quorum. the presiding officer: the clerk will call the roll of the senate. quorum call:

a senator: mr. president, i ask unanimous consent that the call of the quorum be dispensed with. the presiding officer: without objection, the senator from indiana is recognized. mr. coats: mr. president, i'd like to talk about two things here briefly and also yield to my colleague for some remarks.

first of all, while it's beyond our jurisdiction here, perhaps it's a little bit out of line for me to talk about this, i'm just urging the congress, and specifically in this case the house of representatives to follow this body in passing the farm bill, and i do so for a number of reasons, even though i had some problems with the farm bill and i fully understand the issues there that those that believe that -- those policies that directly affect agriculture are being subordinateed to a bill which incorporates about 80% of that bill for federal food assistance. these are nutrition issues which of course are related to agriculture. by the same token, it is a federal program that is significantly different than what the farm bill is designed to accomplish. so about 20% of that bill affects the farmers in our area,

and the other 80% goes to a federal welfare type program for providing food stamps and other nutrition assistance, so i'm hoping that the house, particularly in light of the fact that we are suffering a significant drought, probably the worst drought since 1950, according to the weather records, and getting worse all the time. the temperatures have been in the low 100's all across the midwest, the bread basket of america where we produce most of our grain and feed stock and cornfields and soybean fields and other pastures are burning up with blazing sun and hundreds of degrees every day and no water falling from the skies. so this drought is seriously impacting my state but also a number of midwestern states and essentially the states that produce the bulk of our agricultural products.

they affect not only needed crops to feed -- provide feed stock but also that support our ethanol program and a number of other programs. it's a dire situation, so i'm hoping that the house can resolve its issues and move forward. there are a number of provisions in this farm bill that provide relief to farmers, ranchers suffering from this drought. those are expiring, and so it's important that we pass this bill, we get it past both houses of congress and in the congress, resolved and signed by the president before these provisions expire, and so i'm urging my colleagues in the house where i once served to help with this by moving forward on this farm bill. now, the other point -- the other point i want to make -- and i will yield to my friend in a second.

i just want to introduce this -- is that we are about to face -- we just learned from our leadership, we are about to enter into a short amount of debate before we vote on a motion to address taxes, and this also directly affects our agriculture community, and we'll explain why, but i'd like to yield to my colleague here from mississippi for some comments in this regard. mr. cochran: well, i appreciate what my friend -- mr. wicker: i appreciate what my friend said about the drought. mr. wicker: i happened to be in the state of missouri in the past few days and saw the terrible drought conditions there. i can't think of a worse time with our farm community being devastated by this drought to talk about a huge tax increase on our agriculture community, particularly in the form of the estate tax. i just learned a remarkable thing, and i would ask my

colleagues if this is the state of the bill that we will now be voting on at 4:00 this afternoon. the result of this legislation would be to take the estate tax back up to 55% on all of the value of an estate over $1 million. this would be a devastateing tax increase, and i honestly do not believe that the american people understand that this is the effect of the legislation that our friends from the majority side have brought forward, but if this bill is passed, the way it is currently configured, that would be the result. we would go back to the old law, 55% tax on all the value of these southern and midwestern farms, of any small businesses across the country would go up to 55% over values of a million

dollars. it's an unthinkable result, and i -- i really, frankly, wouldn't be surprised if the phones across the street in our offices are ringing off the walls at this result. i would ask my friend from south dakota if i have misunderstood the effect of this legislation. mr. thune: mr. president, if i might respond to my colleague from mississippi and from indiana, the senator from mississippi is absolutely right. the proposal that we will vote on as presented by the democrats today would allow the death tax exemption to go back down to to $1 million. that's the pre-2001 level. and apply a 55% tax rate on top of that. now, just to give you an example of how that might work in a state like mine, i represent south dakota. the average sized farm in my state is a little under 1,400 acres. if you look at the average -- the value per acre of land and

multiply it by the size of the average farm, you're talking about an average farm between $2 million and $2.5 million in value. so you could be talking about -- this is average. we have a lot of farms that would be impacted in a much more significant way than this, but you are talking about then subjecting about $1.5 million of that farm's value to a 55% tax rate. and 84% of the value of farm assets, according to usda is in real estate. so they're land rich but cash poor. what happens? when the i.r.s. comes calling after someone passes away and says your farm is worth this amount, we're going to assess a 55% tax, they say we can't pay that. we don't have the cash. yes, we have it in land so what do they do? they sell the land. they sell assets. they sell equipment to pay the i.r.s. and here we are trying to promote intergenerational transfer of farms and ranches to keep family farming in this country as part of the backbone

of our economy and this is the absolute opposite of what we ought to be encouraging if we want policies that encourage family farms and ranches to stay in the family. so having a confiscatory tax like this that would apply a 55% tax to assets above a million dollars is going to have a crushing impact on carms and -- farms and ranches in my country and by submit to my colleague from mississippi as well. mr. wicker: if our friend from indiana would continue to yield, this is his time and i don't want to intrude, this is the same effect on mom and pops. on a family business, may have been in the family or generations. we're going to impose a 55% confiscatory tax. i am just speechless that this bill has now gotten to the point where it brings us back to -- to the early punitive estate tax rates which we've gotten away

from. mr. thune: to my colleague from mississippi and again on the senator from indiana's time but to put this in perspective, the proposal in the democrat bill which would take the exemption back down to a million dollars and raise the top rate to 55% would apply to 24 times the numbers of farms and ranches as does current law. in other words, it increases by 24 times the number of family farms and ranches that would be impacted by the estate tax relative to where we are under current law and as the senator from mississippi pointed out lots of mom and pop businesses, 13 times the number of small businesses would be subject to the death tax as is the case with current law. and so, you know, if you look at the impact of this certainly in farm and ranch company, i see our colleague from kansas, senator moran is here who represents a lot of farmers and ranchers like those in my state of south dakota, this is profoundly impactful. it would have a dramatic

impact, adverse, very, very negative impact on frarm and ranch -- farm and ranch country but also on a lot of mom and pop small businesses in this country. mr. coats: i thank my colleagues for joining in on this. they've made their points and -- that i think outline the fact that many of us are stunned with the proposal that is being brought forward for a vote today to proceed on this bill which incorporates a change in the tax law to impose a 55% tax if you die. on all the work and all the profits and all the investment that you've made throughout your lifetime which, by the way, you've paid taxes on over and over and over. the government now can never get enough. so the president is now proposing, being led here by the democrats in the senate, of raising the death tax from 35%, its current level, to 55%.

let me personalize this for just a moment. we have some very close friends who throughout generations have been handing the farm down from one generation to another. and they have suffered through the hard times, the droughts, the hail storms, the tornadoes, they've also benefited from the good times when the rains have come, the soil is good and the yield is good. and yet right now they are suffering in a way they haven't in more than half of a century with this drought that just is unrelenting all across this country and it takes in almost the entire farm belt of the midwest and upper midwest where most of our grain and products are grown. and at a time like this to bring forth a piece of legislation which basically says not only are you being nailed by the weather, and we obviously can't do anything about that except to provide some basic form of

financial help and relief to get through this particular time, that's what i was talking about earlier, but we're going to nail you with a tax that when you die will basically prevent you from passing on your business or your farm to the next generation. and as i said, to personalize it, we have some dear friends, more than one couple and i've talked to people throughout indiana where the pride in holding their ground as part of their extended family covering more than one and two generations, and the work that they have put in in order to preserve that handdown to their children and to -- then to their grandchildren, now goes up in flames. because when they die, they are now imposed if their farm is valued at more than $1 million a 55% tax on the value of

everything over that $1 million. and people say, well, okay, they're millionaires. no, they're not millionaires. they are sitting on property that might be valued that, they might be losing money and for sure this year they're going to lose money. they're not going to make any money this year because they've had to plow their corn under because it happened gotten the rain and moisture it needs and it's not going to grow and we don't know yet the steptd of this -- extent of this disaster. yet to preserve that within the family and hope for better years to come, those won't happen. because they're going to -- as the senator from north dakota said, they're going to have to value their land, the i.r.s. will value their land, at a price which causes them, the only way they can pay for that is to sell their assets. why in the world at a time of an economic drift back into

potentially recession this -- this country is not in good economic shape. we're -- compared to europe we're in better shape but if you look at the numbers, they're not trending the right way. why at a time like this would you walk out onto the floor of the united states senate and put a bill up that is going to raise taxes on people who are already suffering from 35% to 55%? how high does it have to go? how many taxes have to be imposed on the american people before they say that's enough? why don't you clean up your spending process back in washington so we don't have to pay so much in taxes to -- to cover all that you're doing there? i know my colleagues would like to continue to respond to this. i want to turn to my friend and colleague. mr. wicker: if i could make one point because i know my friend from kansas wants to join in here, this could only hurt job creation among small business people and small farmers.

and i can't imagine at a time -- we've had 42 months of unemployment over 8%, the longest in peacetime within modern history. and to put this tax on -- on farms that create jobs and small businesses that create jobs, which is where most of our new jobs come from, is just unthinkable. i can't imagine that it would do anything if it were signed into law as the president wants to do other than make that 8.2% unemployment rate go even higher. mr. coats: i'd like to turn to my colleague from kansas. i didn't name the family but one of the families that's close to us because my wife grew up with her very best lifetime friend, married a farm boy from kansas, and they now run a farm out in norton, near norton, kansas. and we speak with them regularly. and so we have, even though we're city people we have

learned from them the sacrifice that goes into maintaining a farm, the suffering that goes from the whims of the weather, the prices of the crops, and we've seen them struggle and struggle, and this obviously will not be a good year. but this is a farm that's passed down to the third generation. they own a lot of land. but as you know in kansas you've got to own a lot of land because you don't begin to have the soil to get the rainfall that we get in the midwest. so your planning is different. so i know this is a situation that ends the dream that has been passed down from generation to generation because if on the death of the current owners of the farm, the tax on that will force them to sell their land. mr. moran: i thank the senator from indiana for yielding. yesterday in norton, kansas, the temperature was 118.

i read the story where they just watched the thermometer go up degree by degree by degree. and it's now been more than a month in which the temperatures in our state have exceeded 100 degrees. certainly more than a month in which we've had little or no rainfall, most places across our state. the drought is real. and it puts people in a different mood. there's always optimism on a farm. there's always optimism on a ranch. my small business men and women in kansas are optimistic when they get up and go to work every day that it's going to be a better day at the end of the day and tomorrow will be better than this day and next month is better than this month. but i can tell you with the weather pattern that we have had in the midwest this summer, the optimism begins to disappear. and today we come to learn just one more thing that is now going to be oppressive to farmers and ranchers and small business men and women in kansas and across the country. we started this year with a discussion by something the

department of labor did, proposed rules to prohibit restrict a young person from working on a family farm. we've had a series of regulations from the environmental protection agency and others that make it so difficult for a small business person or a farmer to succeed. and now we learn today the proposal that we're going to revert back to days gone by in which a million-dollar estate will be subject to a marginal tax rate of 55%. it has been a series of things in the last year from this administration and this congress that sends a message to farmers and ranchers in kansas and small business men and women in our state and across the country that your value, your work, your work ethic, your efforts will not be rewarded, not only will they not be rewarded but they will be -- we will discourage them. we will not reward the kinds of

things that do you each and every day, the things that you're optimistic about. and the center -- the senator from indiana is so correct. in this sense, that every farmer and rancher i know at the end of the day, their goal is to see that they've done the things that day, not only to feed and clothe and provide energy to the world but see they have a farming operation, a ranching operation that is of the nature that it can be passed on to the next generation of kansas farmers and ranchers. it is -- it is the sense of satisfaction that comes in a farmer's life when the next -- when the son and daughter that follows them has the ability -- nothing is easy in agriculture. there's not a thing any day that's easy on a farm or ranch in kansas or across the country. you're right, our weather patterns, our soil conditions, it takes a lot of drive and effort. it takes stamina and discipline to survive. and much of the day is spent trying to survive. and here we see just a series of

things, as we arrive today to discover that we -- weept to -- we want to increase the tax on people who work hard every day and whose goal it is to sell their sons and daughters, i have a farm or i have a ranch and you can take over where i left off. why is that important? that's the way historically in our state farming has occurred. it's a family farming operation and it's passed down from great grandparents to grandparents to parents to children to grandchildren and there is are great pride and satisfaction that comes from that and we are here today to make certain that the federal government doesn't create one more obstacle toward that goal of making certain that the next generation of kansans have the opportunity to work to earn a living, to feed the world on their own family farm or ranch. and it is so surprising to me that there would be anyone who believes that these individuals, these business

operations, farms or small businesses, ought to be singled out and treated in a way that discourages them from accomplishing that american dream of passing that farm and ranch on to kids and grandkids. and i hope that our colleagues today see the light and understand how important this is in rural america and not only is it important in rural america but what happens in our part of the country determines whether or not we have the ability to provide food and fiber for the country and for the globe. mr. coats: i want to thank my colleague from kansas. i know my colleague from north dakota has arrived, having heard from my colleague from south dakota, and i got the doactas mixed up -- dakotas mixed up. i apologize to senator thune. whether it's the family my wife grew up and knew or whether it's a family down in posey county, indiana, that drew their neighbors together for a meeting just a few months ago, or

whether it's families or business owners of small businesses all across the state of indiana that i've talked to repeatedly who basically are saying i resent being called rich. by the president, who says they need to pay for more in taxes. we've been working our tails off for generations. and we've been paying taxes faithfully for the profits that we've made, the years that we have made profits. and yet we're being classified as some type of elite group that's not paying their fair share. we look back and we read statistics like 47% of americans aren't paying any income taxes, and we're those out creating jobs, building a business; sometimes good years, sometimes bad years. but over a lifetime there's value added to that business, but that value is in machines, it's in buildings, it's in land in terms of farmers.

that gets valuate when we die at a level, which means we can't afford to pass it on to other generations and we have to sell it because the federal government, having taxed us all of our life on the profits that we made, the income taxes, the social security contributions, the medicare contributions, the sales taxes, the personal property taxes, the car taxes, the boat taxes if you have a boat, the excise taxes, the liquor taxes, the beer tax, the sales tax; on and on and on you go. it's not just the income tax. we are being taxed every -- there is not another tax the government doesn't want to impose on the american people. at a time of economic distress when the united states is the only country struggling to stay ahead and perhaps lead the world back into economic growth, at a time when we are seeing some signs of potential double-dip

recession facing us -- the news in the last few days has been dramatically bad -- why anyone kwr-rbgs -- why either party would want to bring a bill to the floor of the united states senate and say you're not paying enough. if you own a small business or if you own a farm you're not paying enough. we think 55% is a fair rate. 55% if you die after you've paid taxes all your life going to the federal government, which is bloated, duplicative. the bureaucracy here is out of control. and congress hasn't lived up to its responsibility to take any kind of sensible fiscal measures that will get us back on track in terms of balancing our budget and not spending more than we take in. all the efforts that took place throughout 2011 and some in 2012, we still have not come up with that program, with that budget arrangement which will put us on the path to fiscal

health. and what is the response from the other side? the response is let's impose another tax. and so at 4:00 today members are going to come down here and vote in terms of whether they want to impose a 55% death tax on people who are already being taxed to death. i'd be happy to -- actually, mr. president, since i need to leave the floor, i will cease here. but then i'm sure my colleague wants to ask his own recognition. spoeup the senator -- the presiding officer: the senator from south dakota. mr. thune: mr. president, i think we have about a half an hour left; is that correct? the presiding officer: the senator is correct. thune i ask unanimous consent that we be -- mr. thune: i ask unanimous consent that we be able to enter into a discussion during the balance of that time. the presiding officer: without objection. mr. thune: i thank the senator from indiana for his very astute observations about the impact of these taxes on hardworking men and women in this country.

and i would say to my colleague from north dakota who is now here and the senator from kansas, both of whom represent very rural states, that this is not an issue that is inconsequential. a lot of people think that people who have $1 million of assets are rich. but as i said earlier, in most farm and ranch operations, the value of that, or 80% of the value of that are in real estate. they may be land rich but cash poor. when you talk about imposing a tax of this size on hardworking farmers and ranchers in this country, you really are getting at the very heart of, as the senator from kansas pointed out, their ability to transfer that farm or ranch operation to the next generation. that's really what's at stake here. the senator from north dakota is here, and the farmland in north dakota is very similar to that of what we have in south dakota except they have energy. they found oil in a few placeness north dakota which

drives those land values up even higher. we would like to see that in south dakota. in either of the dakotas or in kansas you've seen land values go up the past few years and it takes a bigger operation to make it work to survive in modern agriculture. the size of these modern operations in many cases exceed in multiples by amount, the $1 million exemption that would be allowed for under the democratic proposal. everything above that would be taxed at 55% which would be absolutely disastrous for american agriculture today. that's on top of the other taxes. this proposal also raises taxes on about a million small businesses which employ about 25% of the american workforce. it raises taxes on capital gains and defends. then it puts -- and dividends. it puts this death tax back in place with a $1 million exemption. if you look at the number of people who would be subject to the death tax today this

proposal would increase the number of people 24 times, a 2,400% increase in the number of people who would be subject to the death tax, according to the joint committee on taxation. that's the group that studies these issues here and looks at the impact of tax policy. according to the joint committee on taxation, 24 more times farmers and ranchers would be subject to the death tax than today and 13 times more small businesses. that's the scale of the proposal the democrats have put forward. so i would say to my colleague from north dakota, my neighbor, that i assume as he talks to farmers and ranchers in his state, he gets the same sort of feedback i do with people in south dakota, and that is they are very, very concerned about what would be a huge tax increase, so to speak, when someone passes on and tries to pass that operation out of the

next generation. mr. hoeven: that's exactly right. i'm pleased to be here with my esteemed colleague from south dakota as well as my esteemed colleague from kansas. i want to thank the senator from north dakota for the strong points he made here as part of this discussion here on the senate floor. it's certainly about this vote that we'll have on the tax code, its impact on farming and small businesses across this country. also senator coats made a very, very important point just a minute ago and that is with this drought we already have farmers and ranchers, our producers in a situation where they face difficult times because of the drought. i join him in calling on our house colleagues to act on the farm bill. i think it's very, very important that we pass a farm bill as we have here in the senate. i had the opportunity to work on that farm bill with senator

thune from south dakota and others. we passed a good package in the senate. the house ag committee has passed a good package, a good farm package as well. we need that to pass the house floor. we need to get it into conference and get a farm bill done for our producers. i think that's just incredibly important always because good farm policy benefits every american. we have the highest quality, lowest cost food supply in the world thanks to our farmers and ranchers, and particularly now with our farmers throughout the country looking at drought, it is very, very important that they know that we have a sound farm in place both now and for the future. as regards to this vote here in the senate today, whether it's the good senator from kansas, south dakota, indiana and others, this is incredibly important. we're looking at a bill that

essentially is a plan that's been put forward by president obama that will raise income taxes, that will raise taxes on capital gains, and that will raise the estate tax. i was down here this morning, and others have been, talking about the impact on small business that those tax increases will have when we've got 8.2% unemployment. we've had 8% unemployment for more than 40 straight months. and in a, to a large degree people are focused on the increase in the income tax and its increase on small business. but this impact from the estate tax, from the death tax is a big deal, and people need to understand what the ramifications are if that estate tax is increased. and they understand it very well in our states because of the case we're making right here. look at how this affects our farmers and ranchers. you're talking about going from a situation where, when a farmer

or rancher looks to pass on that farm or ranch, right now they're taxed from an estate tax standpoint on the amount above $5 million. and then it's at a 35% rate. but what would this plan that's being put forward today do, that's being put forward essentially by the president, by the other side of the aisle? it would change that to go back to a $1 million -- anything over $1 million is subject to estate tax, and then it's taxed at a 55% rate. so just do the math, and i think that's the point that the good senator from south dakota and kansas and others have been making, is it doesn't work. it just doesn't work. in other words, that family can't borrow enough money to pay off the estate tax and keep the farm because they can't afford to pay back that level of debt. the farming operation won't

sustain it. the ranching operation won't sustain it. you can't borrow that much money to try to keep the farm in the family because you can't afford to pay the debt as a business enterprise it, can't service the debt. so what happens? the only alternative is to sell the farm. so now here you have farmers who have been farming for generations -- their father, their grandfather, grandmother, mother, relatives, all the way back. and now their kids. their kids are farming with them now. their children are involved in that farming enterprise, and they want to continue farming. but that's not going to be an option because they're not going to be able to afford the estate tax. so this is exactly what we're talking about when we talk about how raising taxes will have a detrimental impact on our economy. we've talked about it in terms of small business. we've talked about it in terms of the income tax. we've talked about the ramifications on capital gains

tax. but i think this demonstrates how clearly it truly has an impact across this country on all small businesses. because i think all of us, from our states and from many states, they know these farm families. they know it's not just a job or a vocation. it's a way of life. and it's a way of life that those families have been counting on. and i want to make one further point before i turn the podium over to my esteemed colleague, and that is that these farm families, or any other small business, when you look at the estate tax, keep in mind that they're passing assets. but their entire life, their entire life they have been paying taxes. they have been paying income taxes, sales tax, property tax. they have been paying taxes all the way along. so it's not like they're just handing this stuff on to the

next generation without paying tax, because they're not paying that death tax. they have been paying taxes on it all their lives. and not just one or two taxes. multiple taxes. so this property is taxed their entire life. they worked their entire life to pay those taxes. and then they face a death tax that would force them to sell the business? that's not right. and you know what? that's not right if it's a farm or ranch or, frankly, any other kind of small business in this country, because this country is about small business. that's the backbone. small business is the backbone of our economy. it is the backbone of this country. and that's exactly what we're dealing with. that's why we've put forward an option and we encourage our colleagues to support an option that will continue the current tax rates, that will not raise tax rates. and then we work on extending those current tax rates for a year and we engage in progrowth

tax reform. we close loopholes and we get more revenue for economic growth for a growing, more vibrant economy that puts people back to work rather than from higher taxes. with that i yield the floor to my colleague from south dakota. mr. thune: i appreciate the remarks of our colleague that represents a state composed largely of family farms and ranches and small businesses. it's seupl thraor my state of -- similar to my state of south dakota, similar to senator moran's state of kansas. we share commonalities in terms of the kinds of people, the quality, the hardworking, the backbone, as you said, of our country. and there's a work ethic in the land for people involved in agriculture that really is, you hope gets rewarded. and one of the ways that gets rewarded is when somebody works very, very hard all their

life -- and that's really true in agriculture. there are very few jobs in agriculture that are easy. it is a hard way to make a living. the men and women who are involved in production agriculture have, certainly in my view, among the best work ethics in the country. and you want to see that hard work rewarded. one of the ways you thoep gets rewarded -- you hope it gets rewarded is when it comes time that you pass on is to be able to allow that operation to be handed off to the next generation so they too can benefit from that hard work and build that enterprise, that operation and grow the family farm in a way that is good for our economy generally and certainly good for the economy in places like north dakota, south dakota and kansas. and that's why a proposal like this is so devastating, because you are subjecting, as i said, 24 times more farms and ranches in this country to the death tax than are currently exposed to it under current law. and so this is a dramatic increase in the number of folks

who would be impacted by the death tax. obviously, a significant increase in the amount that people are going to be forced to pay when the time comes, and we -- i think in a time when we are facing unemployment now for 41 months, consecutive months over 8%, 23 million americans either unemployed or underemployed, the one thing we don't need in the middle of this kind of an economy is a big, fat tax increase. and that's what the democrat proposal does, not just on the estate tax but also the marginal income tax rates going up on small businesses on january 1. there would be almost a million businesses who are impacted by higher rates, who do i should say, employ 25% of the workforce in this country, as well as increase in taxes on investment, on capital gains and dividends. so a big, fat tax increase in

the middle of an economic, a very fragile economy is the exact wrong prescription, and i would hope, as the senator from north dakota suggested, that our colleagues on both sides will support the alternative that we will put forward, which will extend the rates for all americans so that not any american is faced with higher taxes come january 1 of this year. i think it would be devastating for our economy to do that. certainly it would be devastat devastating to the family farms ranches in places like the midwest and i know my colleague from kansas understands very well because he represents the same kind of people that we do in the dakotas. they're hardworking. all thin they want know is thaty have an opportunity to be able to benefit from that hard work, hopefully pass it on to the next generation when the time comes. mr. moran: i am pleased that the senator joined us because i think he made a very valid point. it is not just the fear of having to pay more taxes but it is the reality you don't have

the income to pay the tax, therefore requiring the sale of the assets, the sale of the farm machinery and equipment, the sale of the land, the sale of the cattle, and so while no one wants to pay more taxes, in this case it is even more onerousness that you have value to assets. you have some wealth in the land and the equipment and the cattle, but never the sufficient income to pay the tax and, therefore, the sale of those assets is required to pay the taxman, a understand, therefore and, therefore, you don't have those assets that i was talking about earlier to pass on to your children and grandchildren. this is not about i don't want to pay anymore taxes. this is the relate that i i don't have the ability at all to come up with the income unless as the senator from north dakota says,gy to the bank and borrow the money. but then i don't have the cashflow to repay the loan and,

therefore, i sell the property. and this, it comes at a time when many kansans, are farmers, and others would complain about how business and agriculture keeps getting bigger and bigger and bigger. the reality is, we would love to have those farming operations, that family-sized farming scale that is so important to the cultural and economic vitality of communities across kansas and across america, but because we have laws like the estate tax, we sell those assets to bigger entities who can better afford and we reduce the number of family farms that most of us believe are so important to who we are as americans and certainly so important to the economy and the cultural nature of rural america. and this comes at a time in which i've heard the discussion here on the floor today about the farm bill, and i know that my colleagues -- the n the senar from south dakota and the senator from north dakota have

encouraged passage of a farm bill by the entire congress. but this farm bill is a reduction in farm bill spending only really on the side of production agriculture, of family farms across kansas, a reduction in the amount of money available under the farm bill of $23 billion. and farmers in kansas tell me they're willing to take their so-called hit to help reduce the country's fiscal condition. we're willing to take the $23 billion out of farm programs, but don't do other things to us that eliminate or reduce our ability to earn a living. and sowed here comes congress -- and so here comes congress, just a few weeks after we pass a farm bill, reducing amount of money available for farm programs by $23 billion saying, oh, let's do something else damaging to agriculture, to farmers and ranchers; let's impose an estate tax in which the threshold is $1 million and the marginal rate is

55%. contrary to what those farmers say, which is we'll take our hit, we'll contribute to getting this country's fiscal house in order, but let us have the opportunity under a free enterprise system to succeed, and now we have one more handicap, one more hurdle towards accomplishing that. and finally, let me say i was on the senate floor yesterday talking about this issue and particularly talking about a tax system. we need dramatic reform in our tax code. the idea that we would be extending the current tax system for the foreseeable future -- this president ought to start over with something much different. i spoke yesterday in favor of the fair tax. but regardless of what the conclusion is we ought to have a simpler, fairer, more understandable tax code, and we ought to have the circumstance in which most taxpayers don't have to seek professional advice to figure out what it is they owe oar to spend their whole time -- or to spend their whole

time as a farmer, rancher, or businessperson trying to figure out what should i do today that will have a negative consequence on the tax bill tend of the year? we as americans spend a huge amount of time and a significant amount of money in which we pay professionals to advise us how to avoid paying taxes. we desperately need a whole new tax code that is fairer, simpler, much more straightforward and being so that we spend our time growing the economy as compared to spending our time trying to figure out how to manipulate the tax code and in the process lose our individual freedoms because we're all about trying to make sure we comply with the tax code as compared to figuring out what it in the best interest of us as family owners and us as business owners. so while it is important that we point out the onerous nature of the estate tax, we ought to remind ourselves that there is a

much more important goal than this congress, this president have been willing to address, and that is scrap this code and get something that makes sense to the american people, that's understandable, affordable, and that pays the necessary amounts to fund those programs required for us to be a successful country. i would yield to the senator from south dakota. mr. thune: i thank the senator from can a i, too, look forward to working with him on fundamental tax reform because that is really what we need to do to get the economy turned around i think you would see tremendous economic growth. i thirled see our economy unleashed if we would reform our tax code in a way that broadens the tax base, lowers the rates -- the senator from kansas talked about the fair tax. certainly another proposal that many people support. but we do need fundamental tax reform. and it would be nice if when we do that we do away with the death tax completely. but that can said, what's being proposed here today, as we've all pointed out, is something that in many cases and in places

like kansas and south dakota and our colleague from wyoming, senator barrasso is now here that represents a rural state, a state where you have a lot of folks with big expanses of land -- is there are many people in agriculture who are land-rich and cash-poor. the senator from kansas pointed out, when you have an operation that exceeds that $1 million threshold that's being proposed in the democrat tax plan, and then everything above that in terms of the value of your assets is taxed at that top marginal rate of 5%, then you are in many cases having to sell pieces of your operation in order to pay the i.r.s. or, worse yet, going to the bank to borrow money, in which case you may not be able to repay it. but this creates all kinds of problems for people who are involved day to day in production agriculture when it comes to keeping that operation in the family. and so i appreciate the senator from cang can kansas's astute i.

i look forward to debating fundamental tax reform. until that comes, we shouldn't be raising taxes. we shouldn't be raising taxes in this type of economy where we've got as many people unemployed as we do we've got sluggish economic growth and we certainly shouldn't be punishing family farmers, ranchers, and small business people with a punitive tax. i would yield to our colleague from wyoming who is here and represents a state much like mine and much like the senator from kansas, who has a lot of people who would be impacted by this draconian tax. mr. barrasso: mr. president, just to follow up on that because clearly in the great state of wyoming, lots of farmers, lots of ranchers, it is our heritage, it is our economy, it is our future, and many people -- and we talk add little bit about that, just to keep these operations going, actually some of them have a job in town,

so they can make enough money to help pay the mortgage, keep things going, but the price of land continues to go up and on paper they may have quite a bit of resources. so to think that we are in the next hour going to vote on a proposal by the democrats to bring back the death tax is something that should be a surprise to all americans, and it's farmers, it's ranchers, it's also small business owners. i think of the movie theater owner in casper who, known for over 20 years, operated on him, fixed his angle when he broke it. then he started with one small theater. sold the tickets, made the popcorn, other people helped him out, made it all work, expanded to a second movie theater. then again and again. and, you know, he built those buildings, built the business, he made it work. he was there early, he was there late. there was with a broom. when i here the president said,

if you have a business, you didn't build it, someone else did, i would ask the president to come to casper, wyoming, to meet the business owners there, meet the guy that has the dry cleaner, meet the florist, meet the person with the carcakes meet this owner of the movie -- with the car wash, meet the owner of the movie theater. then take a look at the ranchers and farmers and hear their stories, hear their life work, hear what they have put together and now see a proposal on the floor of the united states senate that says, we don't care what you did, how hard you worked, what the impact is going to be on leaving this legacy to your family; we are going to bring back the death tax and we're coming four is something that people back home in all of rural america -- and i would think in many, many places around the country -- would find shocking, astonishing and very sad as a commentary of what role washington and government is trying to impose upon their

lives. to take these levels of taxation to much higher levels where death tax hitsalit hits at $1 md at 5% at that level down from where we are now where it is at $5 million and indexed to infl. we see inflation. and a maximum of 35%. i'm astonished that people would actually consider voting for that. but yet that's what the senate majority leader has been proposing, and that's what we're going to vote on within the next -- within the next hour. it's interesting, i was driving through hot springs county, thermopolis, wyoming, area, talking to a farmer he said, i could fight the weather or i could fight the government, but i couldn't fight both p. then he got out of it. a lot of families haven't gotten

out of it and they continue. now, once again, the heavy hand of government comes with this crushing blow in wanting to raise this sort of tax on families all across the country, people who have really built their own businesses, in spite of what the president may say. these are the people that made this happen. you know, after the president's comments last week, i was in thermopolis for a class reunion over the weekend. they have all the different classes come together, a big picnic and cookout in the park. my mother was in the dallas graduated quite a few years ago. we were talk about the family bakery that she had worked at as a little girl. the family lived above the bakery. they got their food from the bakery because they ate what didn't get sold. they worked every day, talked about her father working so very

early in the morning, through the day. for lunch she walked home from school to be able to eat at the bakery. that's a family that built that business. i talked about her. who else worked there? she started to run through the names of the people in the family that built and contributed to this bakery business, it's called the wigwam in therm op list, wyoming. -- in thermopolis, wyoming. they talked about sonny had worked there. there are a lot of farms and ranches. i see my colleague from kansas here, where there was a sonny who worked on that farm or ranch. who else worked there in the bakery? she said shorty worked there, too. i think every community has a shorty that worked in a business that made something happen. who else? sandy. i know there is a sandy in every community. yet the president thinks they didn't do anything. who else? smoky. we have all these different names of people in the family who made this business, put it

together, built it, built it. those are the people that made this business. those are the people that the president seems to have forgotten or never met in the first place. those are the people that built the businesses of this country. it wasn't somebody else. it was them whose parents worked hard, got up early, the kids worked this. everyone in the family participated, everyone contributed. every community in this country has someone like that. and now to see the democrats coming forth with a proposal that says you may have built a business -- or they may not believe that that family actually built the business, and we just want to tax you more when the person that really put the equity, the sweat equity into it dies. the family end up maybe having to sell as we heard the senator from kansas and south dakota and north dakota. and why? well, a lot of it is because this institution can't control the spending, so they're always looking for new ways to tax other people.

the problem is not that we're taxed too little. it's that we spend too much in this institution. congress spends too much. the president always seems to find another way to spend more money. that's what we see. continuing to look for ways to find money to then spend. borrow, spend. grow government bigger and bigger. that's not what built this country, that's not what made this country great. they are families, ranches, farms, small businesses all across this country with the people through their hard work, their dedication, their commitment getting up early in the morning, working all day long, working well into the evening. and i would ask my friend and colleague from kansas, i'm sure that you can think of families and close your eyes and picture those families where folks actually got up before sunrise and worked through the end of the day and after the sun goes down to build something, to make something of themselves, of their family and their community

to contribute to the community, and now we see government with its heavy hand coming to say death tax is here, we want to raise the death tax and we're coming for you. a senator: i certainly thank the senator from wyoming for his comments. mr. moran: it is a reminder. those of us that had the privilege of growing up in small-town america, we know the names as the senator from wyoming indicated. it's one of the advantages of small town life. you see every day those families that own a business, those families that have a farm or a ranch. you know who they are, you know who works there, you know what jobs are created by that business or that farm, and you have the understanding of how important that is in the community if there is going to be jobs in your town. it is that small business person who gets up early, who works

late, who does whatever is necessary to make sure there is success in that business. sometimes they are successful in that, and sometimes they are not. every day, they fight the fight to make certain that they put food on their family's table. they have the ability to save for their children's education for that better life, save for their own retirement. and again, i think just hike we talked about the farmers and ranchers who are willing to forgo things from washington, d.c., to help contribute to getting our debt under control, to get our fiscal house back in order, to make america again what we know it can be, they're willing to forgo those things that washington seems to want to give us, but all they ask is please don't put more burdens on us, don't make it more difficult for us to succeed. andaway see the -- and we see the example today where the democrat tax proposal creates a huge burden upon a huge sector of this economy and upon people who are so important to us as to

whether or not we're going to have jobs created and the opportunity for every american to pursue the american dream. mr. barrasso: mr. president, we yield the floor. suggest the bens bens. the presiding-- the absence of . the presiding officer: the clerk will call the roll. quorum call:

mrs. boxer: mr. president? the presiding officer: the senator from california. mrs. boxer: i ask that the quorum call be dispensed with. the presiding officer: without objection. mrs. boxer: i ask unanimous consent that i be recognized for two minutes, followed by senator cardin. the presiding officer: without objection. mrs. boxer: thank you. mr. president, i think it's important to simplify what is going on here with these two

proposals, the republican proposal and the democratic proposal, and so i'm going to attempt to do that. you have two packages of tax cuts. the democratic package gives everyone, everyone a tax break on their income tax for the first $250,000 of income, so everybody gets that tax break. the main difference is that under the republican plan, they give more to incomes above 250, where we say everybody gets a tax break up to $250,000, and after that we go back to the tax rates of bill clinton. when we created 23 million jobs, when we balanced the budget and created a surplus. now, in order to do this, the republicans don't do some of the things we do for the middle class. an extension of the tuition tax

credit, a generous childcare tax credit. and so that's the difference. their package costs $50 billion more. and if you figure you do this over ten years, you do the math, $500 billion. but let's just take it to one year. that $50 billion of costs, their package, if you didn't go that way and you supported the democratic package, you could use that to either reduce the deficit or to soften the sequester. you have people running all over television. we're ruining the country with this sequester. these are republicans who came up and supported that idea of automatic spending cuts. you could take that $50 billion if you said the upper income would pay their fair share and cut the automatic spending cuts in half, and with that, i would

yield the floor. the presiding officer: the senator from maryland. mr. cardin: i would ask unanimous consent that the privileges of the floor be granted to elizabeth eckenberg during the pendency of today's session. this is senator merkley's. the presiding officer: without objection. mr. cardin: mr. president, i thank, first, my colleague from california. i agree completely with senator boxer. i happen to be on the floor to be able to listen to my republican colleagues as they were talking about the estate tax. i think we have got to clarify what the legislation we're going to be voting on in a few minutes is all about. it's an effort to fully protect about 98% of americans from the uncertainty as to whether their income tax will go up on january 1. that's what this bill is about. there is a lot of other problems that we have, the fiscal cliff that we have been talking about. and i understand the concerns we have with the estate tax. we have a problem with physician

reimbursement under medicare, we have problems with the sequestration orders and the impact it would have on all of our agencies, whether it's national security, whether it's the domestic budget. we have concerns about extending tax provisions for the energy sector of our economy. we have the unemployment insurance additional benefits, the uncertainty as to whether we'll extend those programs. all of those are legitimate concerns, and i hope democrats and republicans could come together with a credible plan to deal with our deficit. that's what we should do. and i can tell you that i have been one of those senators meeting with republicans, meeting with my democratic colleagues. that's what we want to do. we want to give predictability to the american people about a credible plan to deal with our deficit. i was proud to be part of the democrats on the budget committee in the senate. the presiding officer helped. he said look, let us use the simpson-bowles model to try to get a bipartisan agreement on a budget document much earlier this year so that we could come

forward with a credible plan to deal with the deficit. but we're now just a few weeks away when congress is likely to go out of session for the november elections. we have heard in the house that they're talking about leaving the third week of september. so what we're trying to do -- it's a pretty simple bill -- to say that for the overwhelming majority, 98%, let's at least give the certainty to those -- to the people of our country that they know that on january 1, their tack rates won't go up. why do we want to do that? because predictability gives confidence, confidence allows people and consumers to buy and helps to grow our economy. that's why we do it. sure, it's frustrating we can't deal with everything right now. we want to deal with everything, but we're not going to be able to come to that political agreement. can't we at least come to the

agreement to protect the vast majority of the taxpayers of this country. the bill that we will be voting on very shortly says that we won't let the personal income tax rates go up for those whose incomes are up to $250,000. as senator boxer pointed out, every income taxpayer gets the advantage of that. to make a million dollars, you get the lower tax rates on the first $250,000. so everyone gets the advantage. we also -- and i thank the majority leader for putting this into the bill. we also protect the refundable tax credit because we know that american families depend upon that refundable tax credit. that's part of their planning process to know whether or not they can buy consumer goods. we include that in the legislation that we will have a chance to vote on. we include the american opportunity tax credit. the presiding officer very involved in that. that's to help families afford college education.

i was at a university meeting over the weekend, looked at the debt that our college graduates are inheriting as they go through college. well, we extend in this bill the help we give to working families to be able to afford a college education for the children which represents to build this great nation, helps to make us more competitive. we have also included in the legislation the small business expensing because we want to give predictability to small businesses to go out and buy capital assets so that they can turn around and help our economy grow. so i just really wanted to point out, it's a pretty simple choice. do we believe that we should give the predictability everyone agrees on, can't we keep the bill simple and get it done? my republican colleagues want to be able to find some way to vote no, to help the overwhelming majority of the people of this country. a person -- say this again. if you make a million dollars,

you're going to get a $6,000 relief under this bill. isn't that enough? and then let us come together and hopefully use the time, the remainder of this year or early next year, a credible plan to get our deficit under control, to give confidence to the american people that we won't face that fiscal cliff and we'll get our job done. the whole purpose of this, mr. president, is to create jobs. we need to create more jobs in our country. i want to share with my colleagues this photograph that was taken. i was going to ask where do you think this photograph took place. many people sewing and manufacturing clothing. but you can see there is a u.s. flag there. so i guess my next question is when do you think this photograph was taken? the 1920's, 1930's? i remember growing up in baltimore and seeing all the different clothing manufacturers that were located in my city, so perhaps this is an historic

photograph. mr. president, it's not. it was just recently taken in westminster, maryland. it's the english tailoring company. 380 jobs in maryland, producing the finest suits in the world. i say that because we can succeed in manufacturing in america. the last 28 months, we have seen an increase of 500,000 jobs in manufacturing in america. that's the largest growth since 1995 in our country. we've got to fight for our jobs and keep our jobs here in america. english american tailoring union employees, i had a chance to talk with them. they're -- they're happy not because they have a job, because everyone's happy to have a job. they know they have a good job and they have a company that cares about them, and they take pride in the product they are making. made in america. make it in america.

we have. we have in maryland, in the united states. they make the best custom suits i think in the world because it's american made and because it's the best technology, the best quality of any company in the world. let me tell you something else that might surprise you. they had a 15% increase in sales this year. this year. they added an additional 50 employees this year. they're making plans to break ground on a training facility in westminster, maryland. now they have confidence in their ability to produce the right product for america and to create the jobs and keep the jobs here. i could tell you, we've done this over and over again in america. i know my colleagues have taken to the floor to talk about the car industry, auto manufacturing industry. best sales in five years.

chrysler, the sale increase is 34%. general motors up 12%. ford up 5%. 10,000 new jobs by ford motor company. 4,000 coming from mexico back to the united states. make it in america. our u.s. auto manufacturers are making it in america. we can create more jobs if we just create the right climate. help small business -- i agree. that's where most of the job growth will take place. that's where most of the new innovation comes from. so why don't we take up sensible legislation that the majority leader talked about that would reward small companies that are creating more jobs by giving tax credits? i'm also proud about a provision in that bill that increased surety bonds for small companies so they can compete. that's what we should be doing. and we need trade policies. i want to give another bit of good news. i see senator nelson's on the floor and he was instrumental in getting this done. on the citrus trust fund.

we got the wool trust fund and the cotton trust fund also approved by the senate finance committee. why is that important with this contract we have here? you see, this company, english american tailoring, makes quality suits but they have to import the wool because the wool is not available in america. here's what happens. the tariff today on that wool coming into america is higher than the finished suit if it was imported into america, which encourages manufacturing outside of america. that makes absolutely no sense at all. that's why we have a wool trust fund, to correct this inverted tariff so that we can make it competitive to manufacture in america. that's why we have it. and i'm proud that by a unanimous vote, we're recommending that from the senate finance committee. i hope we can find the cooperation on this floor to get

that done. and i also want to make sure that the citrus industry in florida is taken care of, so we take care of the citrus trust fund and the cotton trust fund. because shirts are manufactured today -- my friend from new jersey, senator menendez helped on this, senator schumer's helped a great deal on the wool trust fund -- we make cotton shirts in new jersey. we can make those shirts because we can manufacture more efficiently than other countri countries. but we can't have an inverted tariff. we can't afford to make it more expensive to manufacture than import. and that's what that's about. that's commonsense policies that make sense. we need tax policies that make sense. and senator stabenow's been working hard on bring jobs home act so that we actually reward companies that bring their jobs back to america and we don't allow taxpayers to foot the bill for those who want to take their jobs overseas. bottom line is, mr. president, we can make it in america. we can make it in america. we are doing that in maryland and we're doing it throughout the country.

we need sensible policies. but we also need the confidence of consumers about the take-home pay that they're going to have in order to be able to buy these suits manufactured by english american tailoring or other companies in our community or to buy a car manufactured here in america. they want to do that, but they need the confidence. so don't complicate the bill that we're going to be voting on in one hour. don't make it that difficult. it's a pretty simple bill. it says whether we're going to protect fully 98% of americans from seeing their tax rates go up and their paychecks go down on january the 1st. and help every american, regardless of their income, with their first $250,000 of taxable income. i would hope we would then make a commitment, democrats and republicans, to put aside our partisan differences, listen to

each other and come up with a credible plan that answers not just the issues -- the only issue raised by my republican cleerkz the he is -- colleagues, the estate tax, but also answer questions over physicians and medicare and answers problems of our -- people depend upon government, the sequestration orders. let's get it together and get all that done. but don't let the traditional partisan differences stop us from protecting 98% of americans so companies such as english american tailoring can continue expanding and create more jobs here in america to help our economy grow, because people will be willing to buy the suits knowing there's some confidence in the tax code that allows them to plan for their future. with that, mr. president, i would urge my colleagues to support the -- the efforts that we're going to have in a few moments, and i will yield the floor.

mr. leahy: mr. president? the presiding officer: the senator from vermont. mr. leahy: mr. president, i know we're soon going to be voting on other matters and i see the distinguished senior senator from florida wishes to speak so i will not take long, but there is one area i don' i don't wante to forget about and that's the violence against women act. you know, six months ago, senator crapo and i joined together to introduce the leahy-crapo vil violence against women reauthorization act of 2011. we decided to put victims first, not politics first. so we set aside any partisan differences the two of us might have. we did this so we could tell the senate that even though we come from entirely different

political philosophies, we're united on the need to protect victims. and, mr. president, at a time when they say that this body is deeply divided, an overwhelming majority of the senate, republicans and democrats alike, joined us in that effort and we passed this commonsense legislation with 68 votes. it's a rare feat in the senate today. there are some who say we couldn't get 51 votes to say the sun rises in the east. we got 68 votes to protect victims. we sent a clear message that we have to stop domestic and sexual violence. we will stand together to protect all victims. most of us here had hoped the house republicans would follow our demonstration of

bipartisanship. we gave them an excellent bill. they could have just quickly taken it up and passed it. but unfortunately they put politics first. they drafted a new bill. they have the right to do that but here's what they didmen did. they intentionally stripped out protections for some of the most vulnerable victims, including immigrants, lgbt victims and native women. they took out the key provisions to make campuses and public housing safer. they rejected the input of law enforcement and victims services professionals who tell -- cease protections they needed to desperately save lives. in other words, they said, you know, two victims who were subjected to the same kind of abuse, we might protect this one

but by law, we won't protect this one. i could tell you, mr. president, there's no one in the law enforcement in this country, no matter what their political background, who wants to be put in that position. they believe that a victim is a victim is a victim. they want to protect all of them. in fact, it was so obvious that the actions of some of these house republicans are too much even for some in their own party. nearly two dozen house republicans, including the chair of the crime victims caucus, they stood up, they voted against this restrictive house bill. you know, we could talk about numbers and all those things but i wish those who came up with this restrictive house bill could have been with me last thursday to hear from laura du dunn, a courageous survivor of

campus sexual assault who told us of her own horrendous experience. but she said, i'm stepping forward to tell you about this because i want you to include the senate provisions the house stripped out. she made an impassioned plea for that and for congress to do all it can to protect all the students on campus from the kind of unspeakable violence she encountered. the kind of violence i pray that my daughter, my grand-daughters would never have to face. but then 200 survivors of campus violence at 176 colleges and universities came forward, came forward publicly, and joined her in an open letter to congress calling for the immediate passage of this critical legislation.

and i ask unanimous consent that a copy of the letter be included in the record. the presiding officer: without objection. mr. leahy: now the house republican leadership is hiding behind a procedural technicality as an ciews to avoid debating -- excuse to avoid debating the senate bill. well, that's nonsense. we all know the speaker of the house can waive the technicality called a blue slip. he could allow the house to have an up-or-down vote on the bipartisan senate bill any time. they could do it this afternoon. i've been consistently calling for house action on this legislation since we passed it overwhelmingly three months ago. in fact, last month, senator murkowski and i wrote a bipartisan letter to speaker boehner. we asked him, allow an up-or-down vote. bit last thursday, five house republicans followed suit. they called on speaker baner and majority leader cantor to take -- speaker boehner and majority leader can to her take up the

senate-passed bill and resolve the blue slip problem. because the speaker's hands aren't tied in this matter. he stopped -- he has to stop choosing to hold up the bill instead of choose to let these efforts go forth. the efforts to pass the bill go forth. a "new york times" editorial earlier this week entitled "delay on domestic violence" put it said. it well. it said, "mr. boehner's leadership could break the logjam but that also requires, of course, his republican colleagues to drop their opposition to stronger protection for all victims of abuse." and i ask unanimous consent that the letters -- the editorial be placed in the record. the presiding officer: without objection. mr. leahy: you know, victims shouldn't be forced to waited any longer. the problems and the barriers facing victims of domestic and sexual violence are too, too serious for congress to delay.

i think of my own state of vermont, the very state that it is, but more than 50% of homicides are related to domestic violence. 50%. that's so unacceptable. we know how to identify these cases early. we know how to intervene. we know how to stop these needless deaths. and the senate bill includes important new tools for law enforcement and comiewnsz all over vermont and every other state to do just that. until the leadership, the house republican leadership, stops playing games, the resources do not reach the people who need them now. lives are going to be lost. enough is enough. let's stop this fiction of saying, why we all stand

together to protect this victim but not this other victim, as though somebody's been victimized, somebody's faced this violence. should be treated differently depending upon who they are. put aside the politics. stop picking and choosing which victim get help and which are ignored. you will not find a single police officer who has gone to a scene of domestic violence or abuse who will tell you, well, i don't want to catch the person who did this, but the person who did this, we'll go after them. no. police officers want to protect us all. that's what the leahy-crapo bill does, protect us all. so i hope the house would take up and vote on the bipartisan senate bill because our bill

protects all victims, domestic and sexual violence knows no political party. victims are republicans and democrats and independents. they're rich and poor, they're gay and straight, they're immigrant and citizen alike. a victim is a victim. and helping these victims, all these victims, whether they're in vermont, california, alaska, iowa, oregon, florida, or anywhere else, that has to be our goal. their lives depend upon it. mr. president, we live a privileged life in the senate. just as the house members do. they're not facing this kind of abuse. the lives of millions of americans do face it, their lives are depending upon us not to play partisan games, but to

give law enforcement and all the various organizations the -- to help prevent abuse, give them the tools they need. we've done dunn that here in the senate. it's time for the house to act. i yield the floor. a senator: mr. president? the presiding officer: the senator from florida. mr. nelson: mr. president, in the midst of all of this tax debate and the partisan wrangling, the gridlock that has ensued, and today we will have another couple of tax votes, and, again, real progress will be stalled. i would like to offer a bipartisan thought that will lead to a solution.

as a matter of fact, i think that there are over 50 senators of a 100-senator body that agree that deficit reduction can be done and done in a comprehensive way. i think the partisan politics all mixed up in election-year politics of a presidential election is getting in the way, and i think that's what you're going 0 to see that's being played out this afternoon on the floor of the senate. what would that solution be? well, if your target is that you want to reduce the deficit over a ten-year period by at least $4 trillion, that was clearly where the simpson-bowles

commission was going, that was clearly where the gang of six that morphed into 45 of us that stood up and had a press conference and talked about $4 trillion plus in deficit reduction. if that's what your goal is and as others have spoken out here, if we could get that kind of deficit reduction agreement for a ten-year period, what you would have is a shot of confidence into the economy, you would see this economic engine start to roar more to life other than the gradual economic recovery that we are seeing, indeed a recovery of 27 straight months of private-sector job growth but albeit a slow economic recovery. if over 50 of us were to come

together and strike that agreement, indeed that's what we would have. and the stock market would take off, the bank lending would take off, the credit ratings would go up, and all of the ins departmental things that would -- incidental things that would flow from that. you know, what, at the end of the year, that's what we're going to have to do and most every every reasonable senator knows that and that's why there are a number of senators on this side and that side of the aisle that have spoken the same message, and what is that message? number one, that you have to have some spending cuts but if you're doing $4 trillion plus, you cannot do it all with spending cuts. you have to have revenue

produced. how do you get the revenue? what over 50 senators in this body would agree to is that you reform the tax code in a comprehensive way by starting to eliminate some of the tax preferences, otherwise known as tax loopholes, tax reductions, tax credits, that have ballooned out of control. you know, the last time that -- i was a young congressman and voted for tax reform, president reagan was president, it was 1986, and when we reformed the tax code back then, the tax expenditures for a ten-year period were worth about $2 trillion to $3 trillion. disown that -- disowng that that has -- do you know that

that has ballooned now to over $14 trillion over a ten-year period just in tax preferences. that's individual tax preference items for different special interests, which means revenue is not coming in. as a matter of fact, there's more going out in tax preferences than there actually is coming in each year in individual income tax. well, if you reform it in the way that a lot of us are talking about, then you take that revenue and you do two things with it. number one, you simplify the tax code and you lower everybody's tax rates, individual income tax rates as well as corporate income tax rates.

and you take the rest of the revenue and you pay down the annual deficit. now, that is fairly common sense and it's fairly simple. of course, to get in and comprehensively reform the tax code is going to be quite a task, and the committee that is designated to make the first cut at would be the finance committee of which i have the privilege of being a member. you have heard similar statements by a number of republican senators. you will continue to hear statements from other democrats such as me about what i just said, and you will hear that because the common sense people know that that's what it's going

to take to get our budgetary house in order. but we're not there. we're in the middle of a partisan war all wound up in the crucible of an election year for president, and as a result, we're going to have two tax votes today that don't pass. the republican version of the tax cut is going to be all of the bush tax cuts from 2001 and 2003, they stay in effect for all levels of income. and, oh, by the way, in their bill they say that to make up for that $405 billion that will not go into the treasury as a result of the continuation of the bush tax cuts, in one

year, $405 billion that you can't do anything with revenue, so they're going to prohibit what half of the senate knows ultimately the solution to the problem. that's one version. the other version is what is being brought forth by the majority leader, which is you give the tax cuts for everybody, including the top 2%, but the top 2% above $250,000 adjusted gross income on a joint return, that that tax rate will go up a little over 4%. just on the income above the $250,000 adjusted gross income. not on the income underneath,

which everybody continues to have the continued tax rate. and that in that same proposal, that 97% of the small businesses will not get any kind of tax increase. they likewise if they're a sub chapter s corporation, will have the same benefits of the tax cut up to that level of $250,000. and you heard comment out here about, oh, we got to keep the estate tax up, which i certainly -- the exemptions on the estate tax up which i certainly agree with. well, in this version that the majority leader is going to offer it has no provisions in it on raising the estate tax. now, would that be my

preference? i'm going to vote for the majority leader's proposal, but my preference is that you would take that tax cut up to the level of adjusted gross income of a million dollars on a joint return, which would be far less than 1% of the people in this country would be affected by a 4% increase in that income above a million dollars. that's my preference. that's what i voted on a year ago. but that is not the choice before us today. and so i have no choice but to vote as i just indicated, but at the end of the day, this isn't going to solve the problem. it's going to be more political posturing, all the way up to the november election, and then

in a lame duck session we're going to get down to work, we're going to let common sense and bipartisanship operate, and we're going to solve this deficit problem. mr. president, i yield the floor. a senator: mr. president? the presiding officer: the senator from new york. mr. schumer: thank you, mr. president. and i very much appreciate the cogent remarks, sensible remarks of my colleague from florida. he has fought long and hard for the middle class in terms of the taxes and in terms of taxes, and i very much appreciate his hard work on this issue. the citizens of florida should be proud of him. now i rise today, of course, also to talk about the upcoming senate vote on the middle class tax cuts. for weeks, senate democrats have been asking our friends on the other side of the aisle to allow this debate on taxes to happen. leader reid has repeatedly offered to have a simple

up-or-down vote on both the democratic and republican proposals. time after time minority leader mitch mcconnell has declined. fortunately that has now changed. senator mcconnell has, after weeks of delay, relented, and decided he isn't going to filibuster our middle class tax cut bill. that is very good news for the country. the most important thing we can do for the economy right now is to provide certainty to the middle class that their taxes aren't going up. now, i believe there are two reasons that senator mcconnell finally decided to allow this to happen. first, forcing his entire caucus to filibuster this legislation would have been politically disastrous for them. it would have prevented any debate or amendments on the democratic tax cut legislation, meaning the republicans wouldn't have been able to offer their amendment to extend tax cuts for those making -- for those millionaires and billionaires. in other words, a filibuster

would have meant that there would have been only a single vote on middle class tax cuts on the democratic proposal, and that almost all republicans would then have been on record against them. so it's easy to see why that would have been uncomfortable for them. second, mr. president, i truly believe that some of my friends on the other side of the aisle have really and truly looked at the democratic proposal and realized that voting for it is the right thing to do. and i believe that senator mcconnell wouldn't have been able to stop them from voting "no." so faced with widespread concern in his caucus, i believe senator mcconnell decided that an abrupt about-face was in his best interest. so, mr. president, the senate is about to speak. we'reing about to pass a bill that will ensure taxes don't go up for the 98% of americans that

earn less than $250,000 a year. we're going to defeat a proposal that would spend almost $1 trillion providing additional tax cuts for the richest 2% and at the same time allowing tax breaks used by 25 million middle-class families to expire. included in that is something very important to me, and that is the $2,500 credit that middle-class families get to help defray the cost of tuition. to not allow that to move forward whether in this bill, the extenders bill or another bill would be very, very bad policy, hurt the middle class and hurt the future of america. so, we're doing it, and i hope everyone will join us in supporting the democratic bill which has that provision to provide tuition relief, tax relief to help middle-class families defray the cost of tuition. now, mr. president, once the

democratic proposal passes the senate, it will be sent to the house. i am sure that speaker boehner does not appreciate the uncomfortable position that senate dems and republicans have put him in. make no mistake about it, senator mcconnell, to save his caucus from a disastrous vote against the middle-class tax extension, had had to put the speaker in a box. the speak knows that if he puts this bill on the floor, his members will have trouble voting against it. so they've decided to put forth an argument they shouldn't bring it up because of a blue-slip issue. while it's true revenue vehicles have to originate in the house, this is a problem that could easily be remedied. in fact, senator reid tried to do it by unanimous consent earlier today, but unfortunately the minority leader blocked it. but when it comes to blue-slip issues, where there's a will, there's a way. house republicans passed two landmark revenue bills this congress after the senate passed

it: the what i bill and the -- the highway bill and f.a.a. bill. senate convince joined democrats despite potential blue slip issues. the violence against women act but, mr. president, if house republicans insist on blocking our middle-class tax cuts and using the blue-slip issue as an excuse, that is a debate we are willing to have. that is a debate we welcome because, for once we have broken the vice that republicans have had on tax issues for 30 years. they will always conflated tax cuts for the middle class and tax cuts for the very wealthy, but that bill allows us to support middle-class tax cuts without -- without -- giving tax cuts to the very wealthiest

among us who, a, it will not bump up the economy because they don't spend as large proportion of that high income. and, b, could go to deficit reduction. i know lots of very wealthy people who say i don't mind paying more taxes if the money would go to deficit reduction. well, our bill allows exactly that to happen. so democrats are going to be happy to bring the argument to the american people and ask them whether they think obscure procedural rules which the republican party in the house has ignored time and time again are now reason enough to let over 100 million families face a tax hike of $1,600 a year. mr. president, the senate is about to pass the only tax cut bill that has a chance of becoming law. no one thinks it's a good idea to raise taxes on the middle

class. no one. we can disagree about whether the very wealthiest in society should also get a tax break, but we all agree that the middle class should get one. so why hold one hostage for the other? the senate supports middle-class tax breaks. the president supports middle-class tax breaks. the house supports middle-class tax breaks. democrats support middle-class tax breaks. republicans support middle-class tax breaks. instead of fighting over whether the wealthiest in society should also get a tax break, why don't we pass this now, give real relief to the middle class and have the other debate later? middle-class americans who don't want to see their taxes go up support what we are doing. the house should act immediately so the president can sign this bill into law. thank you, mr. president, and i yield the floor.

mrs. boxer: mr. president, parliamentary inquiry. how much time remains on either side? the presiding officer: 9 minutes on the majority side. mrs. boxer: and how many on the minority side? the presiding officer: no time remains on the minority side. mrs. boxer: i would yield two minutes of our time to senator hatch. the presiding officer: without objection. mr. hatch: i want to thank my friend from california for her kindness and for her graciousness in allowing me this little bit of time to make a final remark with regard to this bill that senator mcconnell and i filed. we're going to be taking two votes here today on a critical issue in a few moments. action on the fiscal cliff is long overdue. before we vote, i would like to make three points. first, it has been suggested that the hatch-mcconnell bill fails to extend the earned-income tax credit and child tax credit provisions. this is utterly false. the hatch-mcconnell bill

extends these provisions as they were originally agreed to in 2001. and that agreement actually doubled the child tax credit. democrats are complaining that our bill does not extend the stimulus provisions that expanded these provisions even further phaeupbd them more re -- and made them more refundable. democrats sold the stimulus bill as being timely, temporary and targeted. and now they are holding up tax relief for nearly every income tax payer unless the stimulus provisions that are mostly spending through the tax code are extended yet again. second, the democrats' proposal includes a significant increase in the death tax. the number of death tax filers will increase under their bill by 11 times. this is what they are proposing. 98,300 new filers will now have to fill out estate tax forms, get appraisals, deal with the

i.r.s. and get all of this done within nine months of the death of a loved one. that is the equivalent of one entire mid-sized american city being forced to deal with the death tax every year. third, the democrats' bill is a massive tax increase on small business job creators. it would subject 53% of all flow-through business income in the united states to higher taxes. there is a compromise here -- the presiding officer: the senator's time has expired. mr. hatch: i ask for an additional 30 seconds with an equivalent to the other side. the presiding officer: object snob without objection. -- is there objection? without objection. mr. hatch: there is a compromise. our economy needs relief. businesses and families need certainty and all we are proposing is extending current tax law for one more year so that we can dedicate that year and do tax reform. by contrast, the democratic bill offers nothing but more uncertainty and tax increases on job creators. let's face it, we're talking about 940,000 small businesses

that will be drastically affected by this. many of those provide jobs in our society and will continue to do so if we don't clobber them with the democrat approach. i yield the floor. mrs. boxer: mr. president? the presiding officer: the senator from california. mr. mcconnell: mr. president, would the senator yield for just a moment? mrs. boxer: i would yield. mr. mcconnell: i'm going to use my leader time, but i'm happy to defer to the senator from california first. mrs. boxer: whatever is convenient for you, sir, is fine -plt if you want to speak now, i'll defer and take my 8 minutes. mr. mcconnell: mr. president, let the senator from california go ahead. mrs. boxer: okay, thank you very much. let me say that this is a very important debate. when you look at the two plans -- the republican tax cut plan versus the democratic tax cut plan -- what you see is, one

is for the middle class. that's the democratic plan. one is for our middle-class families. it includes tuition tax credit and enhanced child care tax credit. it's very important that we do that. and the other is a give-away to the millionaires and the billionaires. and it is amazing to me that it isn't enough for my republican friends to give everyone a tax break in this nation of ours, up to the first $250,000 of income. and then say after that we're going to go to the tax rates of bill clinton. in those years, unlike the bush years, we created 23 million jobs, and we created surpluses as far as the eye could see. but my republican friends want to go backward to the bush years, to the trickle-down years. and here's the problem: they do

it on the backs of the middle class. now they claim that our plan will hurt small business owners. let me be clear, mr. president. 97% of small business owners earn less than $250,000 a year, so all that talk about job creators is nothing but talk. it's nothing but a smoke screen for the highest earners in america. and here's another problem. the republican plan adds $930 billion to the deficit over ten years. it's a problem. in one year, the first year, it's a $50 billion add-on to the deficit. now i've heard my republican colleagues cry about sequestration. they don't want it, even though they agree to it, when we made our deal around the debt

ceiling. let's remember that. they didn't want to give an increase to the debt ceiling. they held everybody hostage. we lost our credit rating. even ronald reagan said never play with the debt ceiling. they played with it. they played a game with it. and then to get out of it, they said, okay, we'll sequester if we don't have a debt deal. now they're crying about sequester. well, guess what? if you do the democratic deal, you save $50 billion. you could cut that sequester in half. but oh no, they want to do tax breaks for the wealthy few. this is the deal. look at this chart. this is robin hood in reverse. this is robin hood in reverse. the wealthiest among us get back $160,000 a year under the republican plan. let me repeat that. the wealthiest taxpayers in america will get back $160,000 a

year under the republican plan, while the middle class, they lose $1,100 a year for their tax credits. that is the tuition tax credit. they lose $800 a year from an enhanced child-care tax credit. $500 a year from enhanced earned earned-income tax credit. so our families lose money. our middle-class families. while the wealthiest among us get this enormous tax break. and the deficit goes up. and the debt goes up. so when my colleague, senator hatch, says that the hatch-mcconnell compromise is good, it's not a compromise. it's going right back to the problem that led us to this

situation in the first place. it's going right back to the same policies of george w. bush. remember when george w. bush became president, we had surpluses as far as the eye could see. then he gave these tax breaks to the top 1%. and, by the way, this $160,000, that's the millionaire tax break. they want to give tax breaks to the multimillionaires, to the billionaires, to the multibillionaires. they put no cap on the tax cut whatsoever. you can earn $100 billion, they want to give you a tax break. and there's a cost. there's a cost to the treasury. there's a cost to the debt. there's a cost to the deficit. there's a cost to fairness. there is a cost to the middle class. so i think the american people have weighed in on this one, and they believe that to give a tax

break to the first $250,000 of everybody's income is fair, because then the people above that can pay a little more, the same rates they paid when bill clinton was president, and we need to go back to those days when we created 23 million jobs and when we not only balanced the budget, but we created surpluses as far as the eye can see. the question is, madam president, who are you fighting for? are you fighting for the people who make $1 billion a year? that's who the republicans fight for. they get so emotional about it. or are you fighting for the middle class, the heart and soul of america, the people who live in my towns, the people who live in towns across this nation, the people who get up every day, put one foot in front of the other, and work hard. the people who are trying to

raise their families, the people who want us to be fiscally responsible, not have a tax cut that causes huge deficits. we have been there. trickle down doesn't work. giving to the top, top, top doesn't work. it brought us the worst depression since the great recession. vote for the democratic plan. vote against the republican plan. and let's do what our president said, which is get this country moving forward again. thank you very much. i yield the floor. mr. mcconnell: madam president? the presiding officer: the republican leader is recognized. mr. mcconnell: i'm going to proceed for a few moments on my leader time. the presiding officer: the senator has that right. mr. mcconnell: the vote we're about to take on the democratic plan to raise taxes is interesting for a few reasons. first, it's a revenue measure that didn't originate in the house, so it's got no chance

whatsoever of becoming law. second, it's a perfect example of what you get when you put politics over the people who sent you here. if the democrats truly believed what the president's been saying out on the stump, they'd vote for his plan. but as the vote tally will show, they can barely muster 50 votes on their own plan, let alone his. so for the entire president's talk about supporting a balanced approach to taxes, he evidently can't even get 50 votes for his plan in a democrat-controlled senate when we all know he'd need 60 votes to get it to his desk. so instead of voting on the president's plan, our democratic friends have cobbled together the only thing they could come up with that would muster more

than 50 votes, a purely political exercise and a total waste of time. but to be honest, i can't imagine why they want to vote for either one since both proposals raise taxes on about a million business owners and both raise taxes on investment at a time when the economy is in paralysis. i mean, here's the democratic plan for the economy. we'll get this thing going again. we'll get it going again by raising taxes. let's take more money out of small business and send it to washington. that's how we'll create jobs, they say. let us create jobs. let us create the jobs instead of the small business owners out in america. after all, they don't create jobs anyway. of course washington creates

jobs. you're looking for the legislative equivalent of the president's now-famous view that you didn't build that, this is it. this is it. the legislative equivalent of "you didn't build that." this is it. they don't think you deserve to keep what you've earned because you're not responsible for earning it. they don't think you're entitled to keep what you've earned because, after all, you weren't even responsible for earning it. they are. that's the message democrats are sending with today's votes. that you are not responsible for your success. washington is. so give us your money, and we'll handle it for you. that's their tax plan.

that's their plan for the economy and for jobs. fortunately for the american people, there's another approach. next week house republicans will pass a bill that drew broad bipartisan support in this body just 19 months ago, and it would draw broad bipartisan support today. if democrats were more concerned about what's best for creating jobs than they were in centralizing power right here in washington and pleasing their liberal base. now the republican proposal is to do no harm. and to commit to the kind of serious tax reform that we all know we need. that's the vote senate republicans are proud -- proud to take today. and house republicans will take

next week. it's the plan senate democrats and the president would support if they were serious about jobs. so the democratic plan is to raise taxes on nearly a million business owners, and in a notable departure from the president, threaten tens of thousands of family farmers and ranches with a death tax of 55% at the end of the year. that's their plan. that's their idea of an economic stimulus. that's the bill they'd rather vote on than the president's proposal. and it is absolutely the last thing we need right now.

the good news is that this new convoluted democratic bill will never make it to the president's desk. never make it. the bad news is they'll also vote down the one tax plan that should make it to his desk. madam president, we can do better than this. it's time for the democrats to work with us on rewarding success, rewarding success, and not punishing it. i yield the floor. the presiding officer: under the previous order, the cloture motion is -- mr. hatch: madam president? the presiding officer: under the previous order, the cloture motion is withdrawn and the motion to proceed to s. 3412 is agreed to. the clerk will report. the clerk: calendar number 467, s. 3412, a bill to amend the internal revenue code of

1986 to provide tax relief to middle-class families. mr. hatch: madam president? the presiding officer: the senator offered an amendment. mr. hatch: i call up amendment number 2573 and ask for its immediate consideration. the presiding officer: the clerk will report. the clerk: the senator from utah, mr. hatch, for himself and mr. mcconnell proposes an amendment numbered 2573. mr. hatch: i ask for the yeas and nays. the presiding officer: is there a sufficient second? there appears to be. the clerk will call the roll. vote:

vote:

vote:

vote:

the presiding officer: are there any senators in the chamber wishing to change their vote?

the president of the senate: if not, the yeas are 45, the nays are 54. the amendment is not adopted. the clerk will read the -- mr. reid: mr. president? the president of the senate: if we could have order. mr. reid: mr. president, republicans' tax hike on the middle class has just been defeated. their plan would have raised taxes by about a thousand dollars for 25 million middle-class families. while giving millionaires an average of $160,000 pay

benefits, tax benefits, a tax break. let's look at that. what their bill would do is raise taxes for 25 million middle-class families by about a thousand dollars a year, and it would give millionaires $160,000 tax break. those numbers are staggering. their bill would have raised taxes on parents trying to pay for college, on families, especially large families with children, so it's no wonder a majority of the united states senate opposed that legislation. in just a short time, there will be a bill that will pass to cut taxes for 98% of americans, including every middle-class taxpayer and more than 97% of small businesses. this plan, proposed by president

obama, would cut taxes for 114 million american families. theirs raises taxes for 25 million middle-class families. this is the only bill that has a chance of becoming law, so it's the only plan that would actually give a middle-class family the security of avoiding their fiscal cliff. the house should take this legislation up and pass it. president obama believes we must keep taxes low for 98% of americans. democrats agree, so does a majority of americans. mr. president, the majority of americans, including the majority of republicans around this country, believe taxes should remain low for the middle class, but the top 2% should pay their fair share to reduce the debt. the bill the senate is about to pass respects the will of the american people, including a majority of republicans in america outside the halls of

this congress. members of congress, the republicans, disagree with the majority of republicans. the president, of course, has said he will sign the bill immediately. now republicans are threatening to hide behind yet another arcane procedural maneuver to stall this crucial legislation. they are threat toning do something. this will get the attention of the american people. they will say oh, no. mr. president, they are threatening to do something called we're going to blue slip this because revenue was originated in the house of representatives. mr. president, my colleagues have very short memories. senate republicans are all too happy to bypass the procedural hoop when it suits their purposes. they're willing -- they're willing to go around it when it's time to reauthorize f.a.a. they're willing to sidestep it

when we pass the violence against women. we did that here in the senate. they're willing to dodge it when we pass the transportation bill, which is so important to this country. but now their excuse for stalling a tax cut for 98% of the american people is an old procedural trick that the american public does not understand and rightfully so. if republicans in the house fail to act on this bill, taxes will rise by $2,200 for the typical middle-class family of four. that's $2,200 less to spend on gas, groceries, rent and life in general for these people. this tax hike on ordinary families couldn't come at a worse time, just as our economy is doing its utmost to get back on its feet. republicans should not force middle-class families off their fiscal cliff to protect more wasteful giveaways to millionaires and billionaires, an average of $160,000 a year per millionaire.

democrats believe this country can't afford more budget-busting giveaways for the top 2% of earners. mr. president, again, republicans in america agree with us. it's only here in the senate that the republicans don't agree. but that's a debate we're willing to have. house republicans need not hold tax cuts for the middle class hostage in order to have that debate. they can and should pass our middle-class tax cut immediately. once we give middle-class middle-class families security, we can spend the next five months debating whether wealthy families need more tax breaks. we know how the american people feel -- just like we do. mr. mcconnell: mr. president? first of all, let me welcome the vice president here today, our good friend who served for so many years in the senate. it reminds me of the negotiatio that he and i conducted in december of 2010. i got a call from the vice president one day and he said the president thought we ought

to talk over the possibility of extending the current tack rates for everyone because the economy is not doing very well and the worst thing we could do would be to raise taxes on anyone in the middle of this economic situation. i said mr. vice president, i think that's something we would be interested in. and so the vice president and i negotiated for a period of time and agreed that because the economy was not doing well in december, 2010, we ought to extend the current tax rates for everyone. i can remember the signing ceremony. i was there. the majority leader was not. the speaker of the house was not. the president made a speech in signing an extension of the current tax rates for everyone that i could have made myself. 40 members of the senate on the democratic side voted for it. now, today my colleagues, the

economy is growing slower than it was in december of 2010. so we know this is not about the economy. we know this is about the election. we all know there is an election going on. there is a politician from time to time that practiced here in the senate. i'm not offended by that. but what the american people, i think, would like to hear from us is a response to the economic situation. this proposal guarantees that taxes are going to go up on roughly a million of our most successful small businesses. over 50% of small business income, 25% of the work force will be affected by it. it guarantees the taxes go up on capital gains, on dividends,

which provides the income for a huge number of our senior citizens. this is a uniquely bad idea. it may poll well, as my friend, the majority leader, indicated, but of course the fact that he needed to mention that illustrates the point. this is more about the election than it is about the economy. so i would predict there would probably be bipartisan opposition to this proposal. i'm sure a few arms have been twisted in order to get the result. vice president is at a disadvantage, he can't speak, being an occupant of the chair. but in this particular instance, in this particular instance, he is actually better not to because he would have the dilemma of trying to explain the difference between the economic situation the country confronts today and the condition the country confronted in december

of 2010 when the economy was doing better. so be grateful, i say to my friend, the vice president. this is a debate i don't think you would want to lead. so with that, my colleagues and friends, i urge a no vote on this very, very bad idea for the u.s. economy. mr. reid: mr. president? mr. president? in 2010, the country was staring at what had taken place the prior eight years. eight million jobs lost. what's happened in the years since 2010 that my friend, the republican leader, talks about? this administration has created 4.5 million jobs. we haven't -- we haven't filled the hole all that we lost during the eight years of the prior president, but we've made some progress. we all acknowledge we need to do more, but don't ever compare, don't ever compare today with

2010. now, mr. president, first of all, everyone understands all you folks who love to give tax cuts to the millionaires, our bill does that also. the first $250,000 that they make is -- they are treated just like a middle-class family. now, i would also point everyone to this. i've talked about the republicans around the country supporting this legislation. of course they do. they know the deficit needs to be handled and they know that about a trillion dollars is what our legislation will do to fill the hole of the debt. but, mr. president, also people who are in this great country of ours, who have done so well, they understand that they are supposed to contribute more. they know that. my friend doesn't like to hear polls, but let me give him

another one. 65% of these really rich people are willing to pay more taxes. again, the people who are unwilling to do this are people who signed a pledge for this person, grover norquist. and remember, there was a little vacillating about a month ago, so he came up here and had somebody renew their vows with him. so, mr. president, we are on the side of the angels. we're on the side of the american people because this legislation that is going to pass is what is good for the american people. i ask that we have a vote now. mr. mcconnell: mr. president, let me briefly add -- let me just briefly add. i listened carefully to what my friend, the majority leader, said. he once again was making it clear this is about the campaign -- about the campaign and not about the economy.

but if you listen carefully to the rhetoric, what essaying here is these million businesses didn't create this success, that we somehow need to take this money because we'll spend it better on their behalf. now, i know my colleague is going to get the last word, and that's fine, i'm happy for him to have it, but the fact of the matter is this -- the economy is in worse shape today than it was in december of 2010, worse shape today. the growth rate is slower. the president signed this bill, advocated its passage back then because the economy didn't need to get hit with a big tax increase. the growth rate is slower today. the economic situation remains largely the same. the worst thing we could do in the middle of this economic

condition is to pass this tax increase. now, my friend, the majority leader, can have the last word and then we'll be happy to go to a vote. mr. reid: mr. president? mr. president? the vice president: the majority leader. mr. reid: they may have different newspapers in kentucky than i read. i get my nevada clips every day. i try to read some papers from back here. we have now 28 months, 28 months of job growth in the private sector, 20 months in a row. that's pretty good. now, mr. president, this legislation is about the debt. it's about the debt. we have to do something about the debt, and we have tried mightily to do that. we have tried mightily. we had the conrad-judd gregg legislation. seven people who were republican senators who cosponsored that wouldn't vote for it and allow me to get it on the floor because they had adopted the republican leader's philosophy

that the most important thing we can do is defeat president obama for re-election. then we went to simpson-bowles, which was a program we put together when we couldn't get that legislation, it was so good, by two of our best financial minds in the senate, judd gregg and kent conrad, and simpson-bowles didn't make it. then we had a series of talks with the president and this speaker. always, we could never quite get it done. why? even though my friend, and i care about him, john boehner, said i want to do big things, not little things. one of the little things he couldn't do is get his caucus to make just a little bit of revenue so we could make a big deal, the grand bargain. then we tried the biden talks. the majority leader of the house of representatives walked out on those talks. th then we had the super committee. a week before, by statute, patty murray and her troops were

supposed to offer legislation, i got a letter signed by virtually every republican senator saying no thanks, grover wins again. no revenues. so, mr. president, this is about our country, about doing something about a debt. it will contribute about a trillion dollars to the debt. that's not bad. mr. mcconnell: mr. president? mr. . mr. reid: here we go again. mr. mcconnell: i heard my good friend the majority leader say this is about the deficit. this would produce about enough revenue to operate the government for about a week. this would produce about enough revenue to operate the government for about a week. this is not about the deficit or the debt. this is about the campaign. we all know there's a campaign going on, but why don't we do

serious legislating here? no budget, no appropriation bills, no d.o.d. authorization bills. when are we going to actually pass things in the senate? this is a uniquely bad idea for the economy. the good news, i can say to to the american people, it isn't going to happen. today. it ought not to happen any time. this is part of the fiscal cliff that we're facing at the end of the year. the chairman of the fed is concerned about it, the congressional budget office, which republicans certainly don't run, is concerned about it. we've heard talk on the other side we should have thelma and louise economics. just drive the country right off the cliff. all get in the car and go right off the cliff together. and see what it's like.

look, the american people know a campaign is going on but why don't we in here try to do something important for the country now? the campaign will take care of itself. this is not a serious piece of legislation because it's not going anywhere, and thank goodness it's not going anywhere because it would be bad for the economy. the single worst thing we could do to the country. mr. reid: mr. president? the vice president: the majority leader. mr. reid: required reading for decades now has been george orwell. college students now read it just like i did when i was in college. george orwell. he came to the conclusion that we would arrive at a time where up was down and down was up. and that's what my friend the republican leader has done. if there were ever a statement that's orwellian, it's his. we haven't done the

appropriation bill. do you think, just stop and think just a minute, do you think 85 filibusters had a thing to do with that? 85. we haven't done a budget. that is poppy cock. we have one. we did it, and my republican friends, i appreciate it, voted with us. we have our numbers right now and we could have done every appropriation bill, senator inouye marked them up, chairman inouye but we can't do them because we have to overcome 85 filibusters. and for my friend to talk about let's do something important, please. is this bill we're going to pass important? you bet it is. and he said it wouldn't pay for the government for a week or whatever the number was. mr. president, over ten years it's a trillion bucks. one year, a hundred billion. that's even in las vegas not chump change. i wish we would vote now.

the vice president: the question occurs -- excuse me, the clerk will read the bill for a third i'm. the clerk: calendar number 467 a bill to amend the internal revenue code of 1986 to provide tax relief to middle-class family. the vice president: the question occurs on the passage of s. s. 4212. the clerk will call the roll -- is there a sufficient second? there is a sufficient second. the clerk will call the roll. vote: