May 10, 2006

Mr. Speaker,

I rise today in strong opposition to the Republican tax reconciliation conference report. I’d like to say it was an honor to sit on the conference committee, but this backroom deal was cut without any input from House Democratic conferees. The predictable result is a Republican agreement that benefits millionaires at the expense of working families.

You don’t have to dig far into this bill to realize it helps the rich get richer, while doing little for hard working American families. The extended dividends and cap gains tax breaks didn’t even expire until 2008, but Republicans wanted to reward their rich campaign donors before the November elections. As a result, people making over $10 million get an average capital gains and dividends tax breaks of about $500,000 a year. These cuts give families making under $50,000 a whopping $10 tax cut. It is clear where the Republican priorities lie.

Some will say that other tax cuts in this bill help the working class. The facts don’t support that argument. Families struggling to get by on less than $20,000 a year get only $2 in average tax breaks from this bill. Average middle income households only get $20. Where could all these tax cuts go? The answer is simple, those making over $1.6 million – the top 0.1 percent of all taxpayers – get $82,000 a year in tax breaks from President Bush and their Republican friends in Congress.

In sum, this tax reconciliation bill is a $70 billion boondoggle for America’s wealthiest taxpayers. Wouldn’t it make a little more sense to spend this money to help people in need? We could easily eliminate the entire $39 billion in cuts Republicans made last fall to programs like Medicaid, student loans and food stamps. That would leave us $31 billion to fully fund Bush’s No Child Left Behind education plan and provide every child in the country with health insurance. There might even be some money left over to help decrease the budget deficit mess Bush has gotten us in.

It is clear this bill benefits the rich at the expense of the working class, but that isn’t the whole story. Just as Bush lied about weapons of mass destruction to lead us into the quagmire in Iraq, Congressional Republicans are lying about the true cost of this legislation. This bill pays for the tax cuts for the wealthy by actually raising some taxes in the short-term. Many of the so-called “revenue raisers” in the bill will actually end up being huge tax breaks in future years. One specific provision allows people to cash out traditional IRAs and convert them into Roth IRAs. This raises revenue in the first few years, but will cost up to $1 billion dollars a year starting in 2013. Who benefits most from this future tax break? You guessed it…families making over $150,000 a year.

Regardless of what some may say, tax cuts for the wealthy do not generate economic growth, jobs or increased wages. The only people that win under the Republican reconciliation plan are the millionaires who receive all the tax breaks. It is immoral to give a millionaire an extra $100,000 while we’re taking Medicaid benefits away from a family of three making under $15,750.

I urge all my colleagues to stand up for the working class and vote against these irresponsible and immoral tax breaks for the rich.