CONGRESSIONAL BLACK CAUCUS SPECIAL ORDER ON THE BUDGET
Mr. SCOTT of Virginia. I thank the gentleman from New York for yielding, and I join in your remarks for praising Congressman Major Owens, because he, as you pointed out, led the Congressional Black Caucus budget for many years. He showed how you can be fiscally responsible and still address the critical needs of our Nation with a particular emphasis on the least of these and the need to invest in education. So I appreciate your comments.
Mr. Speaker, as the conferees begin to negotiate a budget agreement to fund the Federal Government for the remainder of fiscal year 2014, they should look at the Congressional Black Caucus budget. The CBC budget makes tough choices, but not at the expense of our most vulnerable communities.
The CBC budget cancels the economically disastrous sequester. It protects and enhances Social Security, Medicare, Medicaid, SNAP, TANF, and other vital safety net programs that protect millions of families from poverty. It also reduces our Nation's budget deficit by approximately $2.8 trillion over the next decade.
Mr. Speaker, most of the ideas that have been presented over the past to either cancel the sequester or reduce the deficit almost always involve proposals that cut Social Security and Medicare. These ideas have included changing the way the Social Security benefits are calculated, the so-called chained CPI that cuts the cost of living increases or raises the age of eligibility for Medicare from 65 to 67. These are cuts in those programs.
The CBC budget shows how you can be fiscally responsible without attacking those critical programs that people have paid for during their working years. The CBC budget is able to pay for the cancellation of the sequester and reduce the budget deficit without harmful cuts to Social Security and Medicare. It calls for revenue enhancements totaling $2.7 trillion over the next decade.
Our budget outlines how the House Ways and Means Committee and the Senate Finance Committee can reach this number by highlighting several options that total $4.2 trillion that could be used to reach the $2.7 trillion revenue target. Some of these options include $1.1 trillion by limiting the deductibility of corporate interest payments.
Now, when corporations want to raise money, they can sell stocks or they can sell bonds. If they sell stocks, they make a profit and pay dividends to their stockholders, but they pay tax on the income before they pay the dividends. With corporate debt financing, with bonds, when you pay the interest on the bonds, that is tax deductible.
Why should there be a tax preference for debt financing instead of equity financing? If it was the same and you deny the deductibility of corporate debt interest payments, you could raise $1.2 trillion over 10 years.
You could close special tax breaks and corporate loopholes by limiting deductions for upper-income individuals, closing some of the corporate loopholes, like the gas and oil advantages that they enjoy.
You can raise almost $1 trillion, over $800 billion, by taxing capital gains and dividends as ordinary income. Traditionally, 30, 40, 50 years ago, they were taxed at, actually, above ordinary income for dividends. If you tax them just the same, $880 billion could be achieved.
A surcharge, 5.4 percent surcharge on income over $1 million gets you almost a half a trillion dollars.
A trading speculation tax.
You could also limit the Bush-era tax cuts to that portion of your income, cancel those tax cuts on that portion of your income over $250,000. Only a privileged few make more than $250,000, so that $200 billion could be achieved without being disadvantageous to very many individuals.
Almost another $135 billion can be raised by returning the estate tax exemption to what it was in 2009. You could raise over $300 billion if you reduce it to what the rate was when President Clinton left office.
These are just some of the ideas, and we have listed them specifically, showing over $4 trillion of possibilities for only $2.7 trillion to make our budget add up.
Now, that is a lot of money, but it is in stark contrast to the budget that we actually passed in this House, because that budget calls for closing a gap of $4 trillion. Unspecified, I don't know how in the world they are going to close a $4 trillion deficit because they would have to raise $4 trillion in taxes, or if they are not raising any taxes, spending cuts in the area, in discretionary spending in the area of one-third across the board. Now, we are having trouble dealing with a sequester of about a 10 percent cut across the board. You can imagine how unlikely it would be to achieve one-third across-the-board cuts.
So this budget is real. They are real numbers. The revenue enhancements provided in the CBC budget would allow Congress to totally cancel the sequester, actually pass a jobs bill totaling about half a trillion dollars, which would end the recession by putting millions of Americans back to work, and provide billions more for long-term investments in our economy through education, job training, health care, and advanced science and research.
As I said earlier, these reforms contained in the CBC budget would reduce the deficit by about approximately $2.8 trillion over the next decade when compared to the CBO's baseline. This would put our Nation on a strong and sustainable fiscal path, all without jeopardizing programs that support our seniors and programs that educate our next generation of leaders in business, science, and technology.
The CBC budget would be a wise starting point for the House and Senate conferees, much better than the budget that we passed, because there is that $4 trillion gap that is unexplained. These numbers add up.
It is an imperative that the Congress pass a budget that expands economic opportunity, invests in the American people, and reduces the deficit. The CBC budget presents a concrete plan, in stark contrast to the budget that we passed in the House, because it is backed up by actual numbers; and it adds up, and it shows how we can reduce the deficit while not being forced to make further cuts to vital programs that support our Nation's safety net.
Most importantly, the CBC budget presents a clear path both to economic and fiscal prosperity for our Nation.