Senate Floor Speech
Senator Kay Bailey Hutchison
July 29, 1999 -- Page: S9666

MRS. HUTCHISON. Dr. Greenspan said: If it is a choice of tax cuts versus spending, he takes tax cuts. Paying down the debt is exactly what the Republican plan does. So I think it is very important we keep Dr. Greenspan's comments in context.

If you look at the President's plan, he takes $1 trillion and spends it. The Republican plan takes the same $1 trillion and gives $792 billion back to the people who earned the money, and we have a cushion for spending on issues such as Medicare and education in the rest of the $1.3 trillion in surplus that comes from income tax withholding.

The Republican plan takes all of the payroll taxes that we heard the Senator from North Dakota talk about and puts that into Social Security reform and stability. So when we are talking about a lockbox, we are saying all the payroll taxes for Social Security that people pay in will be set aside for Social Security. That is $2 trillion. That is exactly what the President's plan sets aside for Social Security.

It also has the effect of paying down debt by about 50 percent, according to the estimates. So you pay down debt and you stabilize Social Security with $2 trillion that is set aside from the payroll taxes that people pay in.

But for the other $1 trillion we are looking at that comes from income tax withholding, we have very different plans. The President would spend it. The Republicans would let the people who earned it keep it, and we would hold the rest in abeyance for spending on Medicare, education, national defense.

Why do we want the people who earn this money, who work so hard for it, to be able to keep it? Because we believe the people who earn it need the relief for their own purposes--for them to decide how they want to spend their money. The typical American family is paying more in income taxes in peacetime than ever in our history--38 percent in income taxes. A 10-percent across-the-board tax cut is fair to everyone. Because when people paid their taxes last year--they know what they paid, and they can take 10 percent off that. That is the most fair of all tax cuts, to let people keep more of what they earn. In fact, our tax relief package is less than the tax increases that President Clinton put in place in 1993. At that time, President Clinton said he was going to tax the rich and he put in that category people on Social Security who earned $34,000 a year. That is what he declared as rich. I think these people deserve a break, and that is what we are trying to give them.

We are giving marriage tax penalty relief. This morning at my constituent coffee, I met a schoolteacher and a football coach. I am going to estimate they earn about $35,000 and about $40,000 apiece. They get hit right square between the eyes with the marriage penalty because when you put their incomes together, they go into a new bracket. They are earning, then, $65,000 to $70,000 for a family of four.

That is wrong. We should not tell people because they get married that they owe more in taxes, just because they got married.