I get calls--and I am sure every other Senator gets calls--from constituents who are very upset. They are going deeper and deeper into debt because they can't pay 25 or 30 percent interest rates on their credit cards. We bailed out the credit card companies. There was no provision that said: Stop ripping off the American people. Stop these companies from committing usury.
We are working on legislation that would say to these private banks not to charge any more money for the credit they provide than do the credit unions. It is going to be a tough fight because the lobbyists from Wall Street are all over this place. Wall Street spends huge amounts of money in campaign contributions, and it is going to be tough. But I think we need to pass that. I think the Fed needs to be much more active, in terms of what kinds of interest rates credit card companies should be paying.
Today, I am going to focus a lot, obviously, on an agreement reached between the President and the Republican leadership, which I think does not serve the American people well. One of the areas, as I mentioned earlier, where I think we could do a lot better in addressing the crisis of high unemployment in this Nation is by investing the kinds of money we need in our infrastructure.
According to the American Society of Civil Engineers, they graded America's roads, public transit, and aviation with a D. They said we must invest $2.2 trillion over the next 5 years simply to get a passable grade. Unfortunately, in the agreement struck between the President and the Republican leadership, to the best of my knowledge, not one nickel is going into investing in our infrastructure.
Let me tell you why we need to invest in infrastructure. A, that is where you can create the millions of jobs we desperately need in order to get us out of this recession. Second of all, we need to invest in infrastructure because, if we don't, we will become less and less competitive internationally.
According to the National Surface Transportation Policy and Revenue Study Commission, $225 billion is needed annually for the next 50 years to upgrade our surface transportation system to a state of good repair and create a more advanced system. The Federal Highway Administration reports that $130 billion must be invested annually for a 20-year period to improve our bridges and the operational performance of our highways. At present, one in four of the Nation's bridges is either structurally deficient or functionally obsolete. One in four of our bridges is either structurally deficient or functionally obsolete. Yet in this agreement struck by the President and the Republican leadership, to the best of my knowledge, not one nickel is going into our infrastructure. We need to invest in our infrastructure. We need to improve our infrastructure. When we do that, we can create millions of jobs.
The Federal Transit Administration says $22 billion must be invested annually for a 20-year period to improve conditions and performances for our major transit systems. In Vermont, the situation is no different than in the rest of the country. Thirty-five percent of Vermont's 2,700 bridges--nearly 1,000 bridges--are functionally obsolete. In recent years, we have had to shut down bridges, which caused a lot of inconvenience to people who live in those areas, to workers who had to get to work using a bridge. Nearly half the bridges in Vermont have structural deficiencies. Rural transit options are few and far between, making rural, low-income Vermonters especially vulnerable to spikes in gas prices. In other words, in Vermont, and in other areas of rural America, you have one choice in the vast majority of cases as to how you get to work. That one choice is that you get in your car, you pay $3 for a gallon of gas, and that is it. That is because rural transportation in this country is very weak.
We can create jobs building the buses and vans we need, making it easier and cheaper for workers in rural America to get to work. In urban areas, it is no different. Transit systems in Chicago, New York, and even here in Washington, DC, are in disrepair. Let's improve and repair them. That makes us more efficient, more productive, and more competitive, and it creates jobs now. Not one nickel, as far as I can understand, has been invested in our infrastructure in this agreement.
The United States invests just 2.4 percent of GDP in infrastructure; whereas, Europe invests twice that amount.
Here is something I think every American should be keenly aware of and very worried about. I don't have to tell anybody that the Chinese economy is exploding every single day in almost every way. In China, they are investing almost four times our rate--or 9 percent--of their GDP annually in their infrastructure. Years ago, I was in Shanghai, China. I was coming from the airport to downtown as part of a congressional delegation. While we were on the bus coming in, my wife noticed something. She said: What was that? There was a blur that went by the window. Of course, I didn't notice it; she did. It turned out that blur was an experimental train they were working on--high-speed rail, which is now operational there, and other similar prototypes are being developed in China. Here we are, the United States of America, which for so many years led the world in so many ways, and now you are seeing a newly developing country such as China with high-speed rail all over their country, making them more productive and efficient, and in our cities, our subways are breaking down. Amtrak is going 50, 60 miles an hour, and the Chinese and Europeans have trains going hundreds of miles an hour.
This is the United States of America. Maybe I am old-fashioned. I think we can do it too. I think we can rebuild our rail system, make our country more efficient and create jobs.
China invested $186 billion in rail from 2006 to 2009, and according to the New York Times, within 2 years, they will open 42 new high-speed rail lines, with trains reaching speeds of 200 miles an hour. That is China. So I think if China can do it, the United States of America can do it. That is the way to rebuild America, make us stronger and create jobs.
By 2020, China plans to add 26,000 additional miles of tracks for freight and travel, as well as 230,000 miles of new or improved roads, and 97 new airports--97 new airports. Does anybody in America have the same problem I have when you go to the airport, where you are waiting in line and you have to deal with all the problems of older airports? China is building 97 new ones. We are not. If we are going to be effective in the international economy, and if our kids will have decent jobs, it is high time we woke up and began investing in our infrastructure. So that is not only to improve the long-term strength of America, our economic prowess, but it is also to create jobs right now that we desperately need.
Unfortunately, in this bill, this tax agreement between the President and the Republican leadership, there are many billions of dollars going into tax breaks for corporations. But there is not a whole lot of money--in fact, zero dollars--going into rebuilding our infrastructure.
Similarly--and I know there has been debate since yesterday on this issue. There may be a small breakthrough. I don't have to tell Americans, least of all the people in Vermont, about what happens when the weather gets cold and you are forced to pay very high prices for heating oil. The time is long overdue for us to make the investments we need to transform our energy system away from coal, away from oil. We are spending as a nation--and everybody in America has to appreciate this--$350 billion every single year--$1 billion a day, roughly--importing oil from Saudi Arabia and other foreign countries, in order to make our economy go and in order to keep people warm.
Let me be very clear. The royal family of Saudi Arabia, which is our major source of oil, is doing just fine. Don't worry about the royal family of Saudi Arabia. They have zillions and zillions of dollars. Maybe it is a good idea that we seek energy independence, that we break our dependence on fossil fuel, and become more energy efficient, which, by the way, investing in public transportation certainly will do, and we move to sustainable energy, such as wind, solar, geothermal, and biomass. Guess what. China is doing that. Many of the solar panels coming into this country are not made in the United States but are made in China. They are big into wind turbines. I think the time is now for us to rebuild our infrastructure and create the jobs we desperately need.
Again, unfortunately, despite the enormous infrastructure needs we have in this country, this agreement, signed by the President and the Republican leadership, does not do that. When we talk about transforming our energy system and moving away from fossil fuel and making our homes more energy efficient and building solar panels, moving toward solar thermal power, in the Southwest of this country--New Mexico, Arizona, Nevada--we have some of the best solar exposure in the entire world. There are estimates that just in the Southwest of this country, on Federal land, we can provide 30 percent of the electricity American homes need, if we move toward solar thermal. We need to invest in our transmission lines.
What we are talking about is massive investment to create jobs, make us energy independent, clean up the environment, and deal with the huge amount of greenhouse gas emissions which are contributing to global warming. That is a win-win-win situation. Yet we are not seeing that in this bill.
I wish to tell you something, Mr. President. I will get into this at greater length later. When we talk about our good friends in the oil industry--and I am not here to make a long speech about BP and what they have done in Louisiana, et cetera. I want everybody to know this. I will get into this at greater length later. Last year, our friends at ExxonMobil--and ExxonMobil has historically been the most profitable corporation in the history of the world. Last year, ExxonMobil had, for them, a very bad year. They only made $19 billion in profit. Based on $19 billion, you might be surprised to know ExxonMobil not only paid nothing in taxes, they got a $156 million return from the IRS. How is that? For those of you who are working in an office, working in a factory, earning your $30,000, $40,000, $50,000, $60,000 a year, you pay taxes.
But if you are ExxonMobil, and you made $19 billion in profits last year, not only did you not pay any taxes this year, you got $156 million in return.
It is not just the large oil companies that do not pay their fair share of taxes. I am going to get into this a little bit later, but when we try to understand why we have such a huge national debt and a $1.3 or $1.4 trillion deficit, it is also important to understand that many large and profitable corporations avoid virtually all of their tax responsibility.
In August 2008, the General Accountability Office issued a report. According to this report, two out of every three corporations in the United States paid no Federal income taxes between 1998 and 2005. We have a $13.7 trillion national debt, and according to a GAO report published in August of 2008 two out of every three corporations in the United States paid no Federal income taxes between 1998 and 2005. Amazingly, these corporations had a combined $2.5 trillion in sales but paid no income taxes to the IRS.
Furthermore, according to a report from Citizens For Tax Justice, 82 Fortune 500 companies in America--I guess that is 82 out of 500--paid zero or less in Federal income taxes in at least 1 year from 2001 to 2003. That is a report from Citizens For Tax Justice. And the Citizens For Tax Justice report goes on to say:
In the years they paid no income tax, these companies earned $102 billion in U.S. profits. But instead of paying $35.6 billion in income taxes, as the statutory 35 percent corporate tax rate seems to require, these companies generated so many excess tax breaks that they received outright tax rebate checks from the U.S. Treasury totaling $12.6 billion.
That is from the Citizens For Tax Justice report.
So when we take a comprehensive look at what is going on in this country, why we have a $13.7 trillion national debt, it is terribly important to understand that while the middle class pays its share of taxes, there are many large corporations that not only are paying nothing in taxes, they are getting rebates from the Federal Government.
I will go into greater length later on, but as a member of the Budget Committee I can tell you we discuss quite often how every single year--every single year--corporate interests and wealthy individuals stash away huge amounts of money in tax savings in the Cayman Islands, Bermuda, and other countries in order to avoid paying their taxes in the United States of America. These are American corporations turning their back on the American people, saying--as Mrs. Helmsley said so many years ago, many of you remember--only small people pay taxes. Only the working stiffs out there pay taxes.
If you are a large corporation and you have a good lawyer or a good accountant, you know what to do. You invest your money in the Cayman Islands and in Bermuda, and you don't have to pay American taxes. But, by the way, as the disclosure report last week indicated, no problem; you get bailed out. When things get bad, you will be bailed out by the American taxpayers. On and on and on it goes. The rich and large corporations get richer, the CEOs earn huge compensation packages, and when things get bad, don't worry; Uncle Sam and the American taxpayers are here to bail you out. But when you are in trouble, well, we just can't afford to help you, if you are in the working class or the middle class of this country.
I want to return for a moment to the agreement that the President and the Republican leadership negotiated because I think that is the issue that all of America is now talking about. The President and the Republican leadership say it is a good deal. Democrats in the House yesterday said: Wait a second. It doesn't look to us like it is a good deal. In fact, we don't even want to bring it up on the floor of the House. In the Senate, I can tell you there are a number of us--I don't know how many--who say: Wait a minute. This is not a good deal for the middle class, it is not a good deal for our kids, and it is not a good deal for our workers. We can negotiate a better deal. The reason we are trying to delay passage of this agreement--and I hope very much it doesn't have the votes here--is we want the American people to stand and say: Wait a second, it makes no sense to us to be giving huge tax breaks to the richest people in this country--literally millionaires and billionaires--and driving up the national debt so our kids can pay more in taxes in order to pay off that debt.
This is a transfer of wealth. It is Robin Hood in reverse. We are taking from the middle class and working families and we are giving it to the wealthiest people in this country. I believe the agreement struck between the President and the Republican leadership is a bad deal. There may be some good parts to it, but, by and large, it is not a good deal. We can do better, and the American people must stand up and work with us. They must get on their phones and call their Senators and call their Congress men and women. They must make their voices heard and say: Enough is enough. The rich have it all right now--the top 1 percent earns 23 1/2 percent of all income, more than the bottom 50 percent--and it is absurd that we continue to bail out people who do not need any help and who are doing just fine.
I am here to take a stand against this bill, and I am going to do everything I can to defeat this bill. I am going to tell my colleagues and the American people exactly why, in my view, this is not good legislation. Let me just tick off some of the reasons I think this bill does not serve the best interests of the disappearing middle class of this country.
I don't know what kind of telephone calls the Presiding Officer is receiving from Colorado, but I can tell you that in the last 3 days alone, according to my front desk staff both here in Washington and in Vermont, we are over 5,000 telephone calls and e-mails, and I believe well over 98 percent of those messages are against this agreement. I don't know to what degree that is indicative of what is going on all over this country, but I suspect it is not radically different in other States. I think the American people are saying, with a $13.8 trillion national debt, let's not give tax breaks to billionaires and drive up that national debt, forcing our kids to pay more in taxes, and at the same time have Republicans coming forward to start slashing Medicare and Medicaid and Social Security because of this large debt that we are making larger.
I appeal to my conservative friends. I am not a conservative, but many conservatives have spent their entire political careers saying we cannot afford to drive up the national debt, that it is unsustainable. I agree with that. So vote against this agreement because it is driving up the national debt. In a significant way it is doing that by giving tax breaks to people who absolutely don't need it.
Once again, for those people who are earning $1 million a year or more, on average--on average--they will be getting a $100,000-a-year tax break, and for people earning $100 million a year, that number will be a lot higher. Who believes that makes any sense at all?
Let me give some other reasons I think this agreement is a bad agreement. The President says: Well, yes, we are going to extend tax breaks for all, including the top 2 percent. But don't worry, it is only going to be for 2 years--not to worry, it is only going to be for 2 years.
Well, maybe that will be the case. But you know what. I doubt that very much. I have been in Congress long enough to know if you extend a tax break, it is very hard to undo that extension because if we can't tell our Republican colleagues that it is absurd to continue giving tax breaks to millionaires and billionaires--if we can't do it now--what makes you think we will do it in the midst of a Presidential election?
I say that as somebody who admires and likes the President. The President is a friend of mine. But his credibility has been severely damaged. If he is going to go forward, and if he is the Democratic nominee, I suspect he will say: Yes, I extended it for 2 years against my will; but, don't worry, I am going to repeal them after 2 years. Tell me, who will believe him? His credibility has been severely damaged. We are caving in on this issue and we should not be.
The polls show us the American people do not believe millionaires and billionaires need more tax breaks. If the calls to my office are indicative of what is going on in this country, there is overwhelming opposition to that agreement.
So I am saying that while the President says don't worry, that this is only temporary, I don't like it. But it is only 2 years. I have my doubts. I expect in 2 years, if this agreement goes forward, it will be extended again. As you know, Mr. President, they wanted 10 years on this extension of tax breaks for the rich. I have my strong suspicion that is exactly what will happen, if not made permanent. This country cannot afford to give tax breaks to millionaires and billionaires and have the middle class pay higher taxes to pay them off.
I want to say also that while a lot of attention has been focused on the personal income tax issue, that is not the only unfair tax proposal in this agreement. This agreement continues the Bush era 15 percent tax rate on capital gains and dividends.
Let me be clear about what that means. It means those people who make their living off of their investments--if you invest, if you earn dividends--will continue to pay a substantially lower tax rate than the average American person in the working class, middle class--our firemen, our teachers, our nurses. Those people are not going to pay 15 percent. They pay a higher rate than folks who have capital gains and dividends. I think that is wrong. This agreement extends those provisions.
Furthermore--and this is a point that has to be made over and over--this agreement between the President and the Republicans lowers the estate tax rate to 35 percent. Under this agreement, the estate tax will decline to 35 percent. Under President Clinton, when the economy was much stronger, the estate tax was 55 percent.
Now, I know the Republicans have done a very good job in trying to convince the American people this is a so-called death tax; that in every family in America, when a loved one dies, the family is going to have to pay 35 percent, 45 percent, or 55 percent. I have had people in Burlington, VT, come up to me and say: What are you doing? I have $30,000 in the bank that I want to leave to my kids. Why are you forcing my kids to pay such a large tax?
So let me be very clear. The Republicans have done a very good job in totally distorting this issue.
The estate tax is paid only by the top three-tenths of 1 percent of families in America. If you are in the middle class, even if you are modestly wealthy, even if you are wealthy, or if you are poor, if you are lower middle class, you don't pay a nickel in estate tax if somebody in your family were to die and leave you wealth--not a nickel. This applies not just to the rich but to the very, very rich.
What the Republicans have been arguing for several years now is they want to repeal the estate tax entirely. If they were successful in doing that, that would mean increasing the national debt by $1 trillion over a 10-year period and all of the benefits--not some, all of the benefits--go to the top three-tenths of 1 percent; 99.7 percent of the people do not gain one nickel.
What is in this agreement is not what the Republicans ideally want, which is a repeal of the tax entirely, but what they do get is a reduction to 35 percent with an exemption on the first $5 million of an individual's estate.
Here is a chart which indicates just what I said a moment ago. ``Repealing the estate tax would add more than $1 trillion to the deficit over 10 years.'' It is over $1 trillion, and the beneficiaries of it are just the very wealthy.
Let me give an example of what the repeal of the estate tax would mean. I will read it right off this chart.
Sam Walton's family, the heirs to the Wal-Mart fortune, are worth an estimated $86.8 billion. The Walton family would receive an estimated $32.7 billion tax break if the estate tax was completely repealed.
This is what our Republican friends want.
This agreement between the President and the Republicans certainly does not repeal the estate tax, but it does significantly lower the rates that the richest people, the very richest people in this country, would have to pay.
(Mr. UDALL of Colorado assumed the chair.)
Two days ago, I brought to the floor of the Senate a very simple piece of legislation. I think how that legislation was treated speaks volumes about the debate we are having now. This legislation said that with over 50 million senior citizens on Social Security and disabled vets for the second year in a row not getting a cost-of-living adjustment, a COLA--over 50 million seniors on Social Security and disabled vets not getting any COLA at all--despite the fact their prescription drug costs are going up and their health care costs are going up, they got no COLA. I said I think that in these tough times, it is appropriate that we provide those folks--if we cannot get them a COLA, let's get them the equivalent of a measly 2 percent COLA, a $250 check to all of our seniors and disabled vets. That is what we did, by the way, in the stimulus package. That is all. For over 50 million people, a $250 check costs our government about $14 billion. Yet I could not get one Republican vote in support of that. Republicans say: My goodness, imagine a senior or disabled vet living on $15,000 or $20,000 a year getting a $250 check. What an outrage. We have different priorities, they say. We want to give a $1 million tax break to somebody who earns $50 million a year. That about says it all. If you are very, very rich, the good news is you are going to get more tax breaks. But if you are a senior or disabled vet, we can't get you a $250 check.
I will say that the vote on the floor of the Senate was 53 people in favor of providing that one-time check, 45 against--53 to 45: We won. But here in the Senate, majority does not rule. Republicans filibuster almost everything, and it requires 60 votes. We did not get the 60 votes, and seniors did not get that check. I am going to do my best to see that they do get it. We are going to bring that issue back and back again.
I raise that issue to tell you that one of the very weakest proposals in this agreement, totally outrageous, is the decrease in taxes for the estate tax.
There is another issue I want to touch on. I am going to spend a lot of time on this issue because it has not gotten the coverage and the attention I think it deserves.
This agreement deals with the so-called payroll tax holiday. I know the Vice President and the President and others have been touting this. They say this is really a good thing because it will put more money into the pockets of the working people. What will happen--right now, if you are a worker, you put 6.2 percent into Social Security. It is going to be reduced for 1 year to 4.2 percent. You get the difference, and this is really a good thing. All of us want to see working people have more money in their pockets. That is what we do. That is what we are fighting for.
But let me be clear that while on the surface this so-called payroll tax holiday sounds like a good idea for working people, it is actually a very bad idea. What the American people should understand is that this payroll tax holiday originated from rightwing Republicans whose ultimate goal, trust me, is not to put more money into the pockets of working families; it is the ultimate destruction of Social Security. What they understand is that if we divert funding that is supposed to go into the Social Security trust fund, this will ultimately weaken the long-term financial viability of Social Security. In other words, what we are doing is, for the very first time, diverting money which is supposed to go into the Social Security trust fund and we are giving it to workers today. It is like eating our seed.
Rather than going into Social Security, the President says: Don't worry, this is going to be covered this year by the Federal Government. We have never seen that before. I don't want Social Security to be dependent on the Federal Government because the Federal Government has a $13.7 trillion national debt. And what I worry about is this is not just a 1-year provision; this also could be extended.
Let me quote Barbara Kennelly.
I am glad to see I am joined here on the floor by one of the strongest fighters for working families in the Senate, Senator Sherrod Brown of Ohio. I just want to say this before I ask him a question or before he asks me a question or whatever the protocol is.
I want to quote what Barbara Kennelly, the president and CEO of the National Committee to Preserve Social Security and Medicare, said. This is one of the largest senior citizens groups in America.
Even though Social Security contributed nothing to the current economic crisis, it has been bartered in a deal that provides deficit-busting tax cuts for the wealthy.
Here is the key point:
Diverting $120 billion in Social Security contributions for a so-called ``tax holiday'' may sound like a good deal for workers now, but it's bad business for a program that a majority of middle-class seniors will rely upon in the future.
Barbara Kennelly, president and CEO of the National Committee to Preserve Social Security and Medicare.
I am joined by my very good friend from Ohio, and I want to ask him his sense of this overall agreement.
Mr. BROWN of Ohio. My sense is similar to yours. I was just on a TV show a minute ago. I was asked, the liberals or the conservatives, what they think about this. This really is not a liberal-conservative issue. First of all, the tax cuts overwhelmingly go to the wealthiest taxpayers. We are seeing the kinds of tax cuts that millionaires and billionaires get from the income tax and from the estate tax. But it is also equally important that it blows a hole in our budget deficit.
In some sense, we are borrowing tens of billions of dollars every year now--if this agreement becomes law, we are borrowing tens of billions of dollars every year from the Chinese, and we are putting it on the credit cards of our children and grandchildren for them to pay off who knows when, and then we are giving these tax cuts to millionaires and billionaires. In those simple terms, it doesn't make sense. It doesn't make sense in our relationship with China. It doesn't make sense in the lost jobs that come from that China trade policy. It doesn't make sense in undermining the middle class. It doesn't make sense in terms of fairness in the tax system. It doesn't make sense for our children and grandchildren and the burden they are going to have to bear to pay off this debt. Giving a millionaire a tax cut and charging it to our kids, who are paying taxes on, unfortunately, in the last few years, declining wages, is morally reprehensible.
I know Senator Sanders has been on the floor 2 hours now talking about this and how important it is and really analyzing it and educating about it and all that. I think about the economic policy, too, that this embodies.
Nine or 10 years ago, Senator Sanders and the Presiding
Officer, when he was a Member of the House, Senator Udall from Colorado, and I and others voted against the Bush tax cuts of 2001 and 2003, principally because those tax cuts overwhelmingly went to the wealthy and ended up adding to our national debt. We had a surplus then. We sure don't now. We had the largest surplus we ever had in 2001. It blew a hole in that. But we passed those tax cuts under the belief, those who supported it--President Bush and Senator McConnell and so many others--under the belief that that kind of trickle-down economics would grow our economy.
In the 8 years--and this is not partisan, this is not opinion, this is fact--from January 1, 2001, to January 1, 2009, President Bush's 8 years, we actually had private sector job loss in this country. Contrast that with a different economic policy--January 1, 1993, to January 1, 2001, the Clinton 8 years. Again, this isn't partisan, this isn't opinion, this is fact. During the Clinton 8 years, we had 21 million private sector jobs created--21 million private sector jobs created--and literally zero private sector jobs in the Bush 8 years of trickle-down economics.
Why would we blow a hole in the budget, which this bill does, for our kids to pay off? Why would we continue an economic policy that clearly did not work for this country? It didn't work for the middle class. We saw middle-class wages--not only no job increase during those 8 years, except for the people at the very top, we saw actual wage stagnation or worse. Most Americans did not get a raise during the 8 Bush years. Most Americans simply saw their wages flat or in many cases decline. The superwealthy saw a big increase in their incomes and in their net assets. And now we are going to give a tax break to them.
This is not class warfare. Lots of people I know have a lot of money. I don't have any ill will for them. But why would we help those people who have done so very well and then have our children pay for it?
Senator Sanders just mentioned the letter from Barbara Kennelly from one of the largest seniors organizations in the country and what this will mean for Social Security. Here is my fear. If this is passed, we are going to see our budget deficit increase, according to the Congressional Budget Office, about $900 billion because of this package, $800-some billion over the next couple of years.
As soon as it is signed by President Obama, even though it was negotiated with the Republican Senate leadership and overwhelming numbers of Republicans in the Senate and House--I assume they are going to vote for it--they are going to say: Look at the huge budget deficit President Obama created. From that day on, they are going to go after ways to cut the budget. That is OK. I agree we need to deal with spending and taxes and the whole picture.
But I also know from watching Republicans--I saw them in the House when they moved toward Medicare privatization in 2003, 2004, and 2005. They had some success. Fortunately, we were able to beat back most of it. I remember that in 2005, after President Bush was reelected in a very close race, he spoke repeatedly about privatizing Social Security. I know that is what they want to do. In the 1990s, Speaker Gingrich--fortunately beaten back by President Clinton--tried to privatize Medicare.
That is the way they cut the budget, they go after Medicare and Social Security. So this vote on this package--to me, we need to call the President, write the President, work with the President to say: No deal, and this has to be something very different from what it is now because it will cause huge deficits our children and grandchildren will have to bear. It will not help the economy appreciably because we saw what the trickle-down economic policies of the Bush years did. It does not help the middle class enough.
So it is pretty clear to me how this jeopardizes Social Security, how it jeopardizes Medicare, how it will force more cuts and more pressure on those programs that have lifted so many people into the middle class. In 1965, when Medicare was first passed, half of the senior citizens in this country had no health insurance--half of the seniors had no health insurance. Today 99 percent of seniors have health insurance, something like that.
I know we are a country now that has created a strong middle class. We have seen that middle class--because of these tax cuts for the wealthy, trickle-down kind of economic policy, we have seen the middle class shrink in the last few years. I do not want that to keep happening. That is why I am very concerned about this. That is why I am working with the Senate to say: No deal. We need to much more seriously focus on not running up a huge debt, on making sure Social Security is protected, on an economic policy that works for the middle class, on a tax policy that is fair to the middle class.
That is why Senator Sanders' work is so important on the floor today, taking the floor for a longer period than anybody I have seen since I have been in the Senate, in a filibuster kind of setting, where he is raising these questions, asking these questions, educating the public, talking to people all over the country, in this Chamber and outside to change this policy.
Mr. SANDERS. If I could interrupt my friend from Ohio and ask him a question, it is on an issue the Senator dealt with last night. Talk about the kind of priorities we have seen in the Senate recently, where just a couple of days ago the Senator and I worked very hard to try to make sure seniors on Social Security and disabled vets were able to get a $250 check at a cost of $14 billion, we could not get one Republican vote for that, while at the same time Republicans are pushing tax breaks of over $1 million a year for the richest people in this country. Does that seem----
Mr. BROWN of Ohio. It tells a story. I came to the floor right after that vote. I had supported it all along. I cosponsored Senator Sanders' effort to bring that to the floor, for the $250 check for all seniors and all disabled veterans, I might add, not just Social Security beneficiaries. But I came to the floor right afterwards because I was pretty amazed.
I know there is partisanship here. I know some people think their whole view of the world is to give tax cuts to the richest people of the world and it will all trickle down and we will all do better, it will lift all boats. That is a pretty good economic theory you might have learned at Harvard or you might have learned at Johns Hopkins near here or wherever. But it does not work. It is a nice theory, but it does not work to lift all boats.
So Senator Sanders' effort was to provide a $250 check, one time, at a cost of $14 billion. But one time, not continued $14 billion--one time for seniors who had not had a cost-of-living adjustment in 2 years. It just seemed to make so much sense when the average senior in this country gets about a $14,000-a-year Social Security check. I think that is about $1,200 a month. That is not their entire income for most seniors, but it is a big part of it. Many seniors live only on that. Many more seniors live on that, but only another couple $300, $400 a month.
There is not inflation maybe for people my age so much in this country, but if you are older and you have a lot of health care costs, there is inflation because the health care costs seem to go up higher than maybe anything but higher education, and maybe as much as that. So it was important that $250 be provided, we think, to every senior in the country and every disabled vet.
What was so amazing about it was that 42 Republican Senators signed a letter saying they would do nothing, nothing in the Senate, until tax cuts for the rich were approved, until they were signed into law.
Now, I have never seen Senators engage in a work stoppage or a strike. I mean, it was not quite a strike, which it is probably illegal for us to strike. I do not know, maybe. But it was a work stoppage.
They are saying: We are not doing anything until you give tax cuts to my rich friends, and I might say also to many people in the House and Senate whose income is in that bracket too. I am not accusing them of that, to be sure, but they were there for their rich friends and their biggest contributors and the wealthiest people in this country. But they were not there for a senior citizen living on $1,200 a month that could use that extra $250.
I have met too many seniors, and I know the Presiding Officer, when he travels to Colorado Springs or he goes to Cimarron or he goes to Denver, I know he hears seniors say: I cut my pills in half because I need my prescription to run for 2 months rather than 1 because I cannot afford it. Or I skipped my medicine today because my house is too cold, and I do not have enough heat. We know seniors make those choices. We make choices here, and the choice we made is 42 Republicans made it and blocked it because we need 60 votes. We had a majority of voters, an easy majority, for Senator Sanders' effort, 53 votes, 53 votes to do this, the $250, but we need 60 votes.
So 42 Republican Senators engaged in their work stoppage saying: We are not doing anything until we get these tax cuts for the rich. They said no to seniors. I am amazed by that, the callousness. I guess I am even more amazed when you consider--what is today, the 10th--when you consider in 2 weeks it is Christmas Day. That does not seem to bother them. It does not seem to bother them on unemployment benefits. And 85,000 Ohioans, a week and a half ago, lost their unemployment benefits--85,000. Their holiday season is ruined.
But I guess all of us will go home. I want to go home and be with Connie and my kids on Christmas. My children are grown. We have one grandchild. I want to be with him for as much of Christmas as I can. But we have a job to do today, this week and next week and this month and this year; and that is to extend unemployment benefits to people who have lost them, who are looking for jobs as hard as they can in a great majority of cases, and extending the tax cuts for the middle class and doing the right thing. So far, we have not done that.
I need to go to the airport. But I want to yield back to Senator Sanders for his work today. I hope next week, when we come back on Monday, we are prepared to do whatever it takes to say no deal on this one and to make this work for the middle class, make it work for Social Security beneficiaries, make it work for unemployed workers.
Mr. SANDERS. I thank my good friend from Ohio, one of the real fighters for working families in the Senate, not only for coming down here but for his years of efforts. But he makes a very important point. We have a job to do and the job is--I know some people do not believe it. It is a rather radical concept. But our job is to represent working families, the middle class, and not the wealthiest people in this country.
I have four kids, six grandchildren. I look forward to spending the holidays with them. But you know what. We have a job to do, and if it means staying here through Christmas Eve, through New Year's, that is our job. And let's pass a proposal that works well for ordinary families and not just for the wealthiest people in this country.
I wanted to thank Senator Sherrod Brown for coming down.
What I want to say now is, when you look at this agreement, we have talked now about the absurdity, in the middle of a time when we have a $13.7 trillion national debt, of giving tax breaks to people who do not need it. Senator Brown and I have talked about the dangers inherent in this payroll tax holiday and what it might mean for the future of Social Security. But I also wanted to make another point; that is, that there are many billions of
dollars in this proposal going to a variety of business tax cuts. Some of them, in fact, might work; some of them, in fact, might not work. But what is very clear is, if your goal is to create as many jobs as possible for every dollar of investment, this particular approach is not very effective.
When we talk about tax breaks for corporations and companies, what we should be aware of is that corporate America today--today--is sitting on close to $2 trillion in cash. They have that cash on hand. The problem is not that they do not have the money, the problem is that working people do not have the money to buy the products these guys are producing. I believe, and not just me but I think a variety of economists from across the board, it makes a lot more sense if we are serious about creating jobs to invest in our infrastructure.
I say that for a number of reasons. When you put money into roads and bridges and public transportation, you are creating, for every dollar you spend, far more jobs than giving a variety of tax breaks. That is an economic fact.
Second of all, when you are investing in our infrastructure, not only are you creating jobs short term, you are leaving the country with long-term improvement that increases our competitiveness in a very tough global economy. I mentioned a moment ago, and we will get back to it later, China is investing huge amounts of money into high-speed rail, into their roads, into their bridges. Yet if you drive around certain parts of America, you think we are a Third World nation. You have roads with all kinds of potholes. You have bridges which you cannot go across. You have rail systems where trains are going slower--there is a study out there that I am going to get to later--where somebody said that decades and decades ago, it took less time to go from various parts of this country to the other on trains than it does today because our rail beds are in such bad shape.
So if we are going to make our country competitive, we have to invest in infrastructure. It creates jobs. It adds long-term value to this country. Unfortunately, in this agreement, there is, to the best of my knowledge, not one nickel going into infrastructure. It is important that we, in fact, add provisions which do invest in our infrastructure and create jobs.
Another point that should be made when we look at this so-called compromise agreement established by the President and the Republican leadership is that in the agreement there is an extension of unemployment benefits for 13 months. Now, there is zero question, in my mind; that is something that absolutely has to be done. Right now--Senator Brown made this point--we have millions of Americans who have, through no fault of their own, lost their jobs. Maybe their plants went to China. Maybe their companies could not get the loans they needed to stay in business. Small businesses are going under, big businesses are shutting plants. No question we have to extend unemployment benefits.
But what bothers me is that this provision in this agreement, which is a good provision, suggests that this is a hard-won compromise; that the Republicans conceded something and they agreed to a 13-month extension of unemployment benefits. But here is the fact. The fact is, for the last 40 years, when unemployment rates have gone above 7.2 percent, Republicans and Democrats, in a nonpartisan way, have come together to say, of course, we are going to extend unemployment. This is America. We are not going to let working families who are suffering hard times because, through no fault of their own, they have lost their jobs, we are not going to let them lose their homes or not enable them to feed their families. This is America. We are not going to do that.
Republicans have said that for 40 years. Democrats have said that for 40 years. Democratic and Republican Presidents, leaders in the House and Senate, have said that. So to say: Oh, my goodness, the Republicans made a major concession; they are going to allow the extension of unemployment benefits for 13 months, that is not a concession. That has been bipartisan public policy for the last 40 years.
Now, I have been expressing to you and to the American people why I think this is not a good agreement,
why I think this agreement should be defeated and why I believe we can put together a much better agreement.
I do want to be clear. There are positive aspects to this agreement which should be maintained in an improved proposal. Let me mention some of them. This proposal, in addition to extending unemployment benefits for 13 months, extends the middle-class tax cuts. That is obviously something we have to do. The reality is that the middle class is collapsing. During the Bush years we saw a $2,200 decline per year in median family income. Working families are hurting. There is no question. To not extend that tax cut for 98 percent of America would be a travesty. So we have to maintain those tax cuts, and that is a positive thing in the agreement which obviously any future agreement must maintain.
Also in this agreement is the earned-income tax credit for working Americans, a very important provision, and the child and college tax credits are also in this agreement. These proposals will keep millions of Americans from slipping out of the middle class and into poverty, and they will allow millions of Americans to send their kids to college. I am not here to say to the President or the Vice President that there are not any good proposals and parts of this agreement. There are. But we can do much better.
What the President says--and he makes a valid point--show me the votes; he is good at counting. We tried a proposal here, where we only got 53 votes, which said we are going to extend the tax breaks for the middle class and not the very rich. The President knows, as everybody else knows, that around here Republicans filibuster everything. We need 60 votes, and he said: Show me the votes. This is what I would say: What our job right now is about is reaching out to the American people from one end of the country to the other, from California to Vermont, including a lot of our very conservative States. Frankly, it is not a conservative approach to substantially increase the national debt by giving tax breaks to billionaires. How many times have we been here on the floor hearing our Republican colleagues give long speeches about the danger and the unsustainability of a $13.7 trillion national debt and a $1.4 trillion deficit? We have heard it day after day. That is their mantra. If they believe that, why are they voting for a proposal that substantially increases the national debt for the very unproductive reason of giving tax breaks to the richest people who don't need it?
The reason we have to defeat this proposal and fight for a much better one is, I would hope that people throughout this country, from Vermont and Colorado, and many of our conservative States, would come forward and say: Wait a second. I do not want to see my kids and grandchildren pay more in taxes because we have borrowed money from China to increase the national debt in order to give tax breaks to millionaires and billionaires who have done extraordinarily well in recent years and, by the way, have seen a significant decline in their effective tax rate.
I know the Chair has heard wealthy people such as Warren Buffett make the point over and over again that what he really pays in taxes, his effective tax rate, is lower than his secretary's. All over this country we have examples where very rich people are able to stash money in the Cayman Islands, take advantage of all types of loopholes, and are paying rather low effective tax rates, in many cases lower than police officers or firemen or teachers or nurses. Opposition to this agreement should be tripartisan. We should have conservative Republicans, liberal Democrats.
I am an independent progressive. I can tell my colleagues in the last 3 days my office has received probably close to 3,000 phone calls, 98 percent of them against this agreement, probably higher than 98 percent, and a huge number of e-mails also overwhelmingly against this agreement. I suspect--I don't know it for a fact--that this is the kind of message the American people are sending us all over America. But they have to continue to do so. They have to make it clear so we can win over at least a handful of Republicans and some wavering Democrats and say: Wait a second. We are not going to hold hostage extending middle-class tax breaks in order to give tax breaks to billionaires. We will not hold hostage extending unemployment for workers who have lost their jobs by giving tax breaks to people who don't need it.
If the American people give voice to what they are feeling, that this is not a good agreement, that we can do a lot better, I think we can defeat this proposal, and we can come back with a much better proposal which protects the unemployed, extends unemployment benefits, protects the middle class, extends the Bush tax cuts for 98 percent of the population, and protects a lot of important programs, making college more affordable, making childcare more affordable, and helping us transform our energy system.
There is a lot we can do if we defeat this proposal. We are not going to do it inside the beltway. Republicans are very united. But what we have to do is win at least a handful of them and some wavering Democrats to say: Mr. President, Republican leadership, you guys have to involve Congress in this discussion.
I was pleased yesterday that the Democratic caucus said: Sorry, we are not bringing that proposal onto the floor. I applaud Speaker Pelosi and the Democratic caucus for saying so. That took courage. Congressman Welch from the State of Vermont played an important role. Congressman Peter DeFazio played an important role. I congratulate him. I congratulate the caucus for saying we can do better than we are doing.
Let me be frank: We are not going to do better unless the American people stand up and help us. We are going to need a lot of phone calls, a lot of e-mails, a lot of messages so that all of our colleagues in the House and Senate understand the American people do not want to see their kids having to pay off the debt incurred by giving tax breaks to billionaires.
This agreement doesn't come out of the blue. It comes within a context that frightens many people. Many Americans have a sinking feeling that there is something very wrong in our country today. I know my father came to this country at the age of 17 without a penny in his pocket. He became the proudest American one could ever see. He didn't have much of an education, but he knew this country gave him a great opportunity. That is the American story. That is what it is all about. To millions and millions of families, whether they came from other countries, whether they just made it on their own--I know we have heard the majority leader Harry Reid talking about his experience growing up in a desperately poor family--that is what America is about. But there are a lot of folks out there who believe there is something wrong, and the facts back them up.
What is going on in this country is the middle class is collapsing. Poverty is increasing. I have four kids and six grandchildren. I am not worried about me, but I am worried about what happens to my kids and my grandchildren. We have some wonderful young pages here, and we worry about their futures as well. We don't want to see our kids and grandchildren be the first generation in the modern history of America to have a lower standard of living than their parents. We don't want to see this country's economy move in the wrong way. We don't want a race to the bottom. We want to see our kids live healthier and better lives than we do, not have to work longer hours, not getting a lower quality of education or less education. That is not the history of this great country.
I want to talk about one aspect of what is going on that does not get the kind of attention it deserves. There are obvious reasons why, having to do with who owns the media and corporate control of the media, having to do with who provides the campaign contributions that elect Members of the House and Senate, having to do with all the lobbyists who surround this institution. Wall Street and the oil companies spend hundreds of millions of dollars on campaign contributions. The issue I wish to discuss is who is winning and who is losing in this economy. I come from New England. Everybody follows the Celtics. We follow the Red Sox, the Patriots. What everyone asks is, who won the game? Did the Patriots win or lose? That is what we want to know.
In fact, in America, it is pretty clear in the economy who is winning and losing. The vast majority of people, working people, middle-class people, low-income people are losing. That is who is losing. It is clear who is winning. The wealthiest people are doing phenomenally well. They are winning the economic struggle.
In America today--we don't talk about this too much, but it is time we did--we have the most unequal distribution of wealth and income in the industrialized world. I haven't heard too many people talk about that issue. Why not? Our Republican colleagues want huge tax breaks for the richest people, but the reality is the top 1 percent already today owns more wealth than the bottom 90 percent. How much more do they want? When is enough enough? Do they want it all? We already have millions of families today who have zero wealth. They owe more than they own. Millions of families have below zero wealth. We are living in a situation where the top 1 percent owns more wealth than the bottom 90 percent. The top 1 percent owns more wealth than the bottom 90 percent. That is simply unacceptable.
This is something we must be absolutely ashamed about and have to address, instead of giving tax breaks to billionaires. Maybe we should appreciate the fact that about 25 percent of our children are dependent on food stamps. We should understand that in the industrialized world, the United States, as this chart shows, has the highest rate of childhood poverty. Is this America? Is this America? The United States today has over 20 percent of its kids living in poverty. In Finland, the number is about 2 or 3 percent; Norway, maybe 4 percent; Sweden, maybe 4.5 percent; Switzerland, 6 percent, whatever it may be. But here we are. If people are watching on television, what they are seeing is the red line. Here is the United States, well over 20 percent. Here is the Netherlands in second place. It looks to me like about 7 percent. This is the future of America. So we are sitting here talking about an agreement which says: Let's give huge tax breaks to billionaires. And here is the reality. We have a rate of childhood poverty far surpassing any other country on Earth.
This is the other half of the equation. What do my colleagues think happens when we have millions of kids living in poverty? What do my colleagues think happens when we have kids who are dropping out of school when they are 13 or 14? I talked to a fellow in Vermont who runs one of our jails. He said about half the kids who drop out of school end up in the penal system. That is what happens. The result is, the highest rate of childhood poverty in the industrialized world, and then what we end up with is more people behind bars than any other country on Earth.
China is a Communist totalitarian society, much larger than the United States, which is a democratic society. We have more people in jail than China and more people in jail than any other country. So what we end up doing, which seems to be not terribly bright, is spending perhaps $50,000 a year keeping people in jail because they dropped out of school. They never found a job. They got hooked on drugs or whatever. We pay to put them in jail rather than investing in childcare, in education, in sustaining their families.
So when we look at the context in which this agreement was reached, we have to see that it takes place at a time when the rich are already doing phenomenally well, while we have the highest rate of childhood poverty in the industrialized world.
During the 8 years of President Bush, the wealthiest 400 Americans--that is not a lot of people, 400 families--saw their income more than double while their income tax rates dropped almost in half. So you have 400 families--all of whom are already multi-multimillionaires--where during the 8 years of President Bush their income more than doubled while their income tax rates dropped almost in half.
I would say to my colleagues in the Senate, we do not have to worry about these guys. They are doing just fine. They do not need an extension of tax breaks. The wealthiest 400 Americans now earn, on average, $345 million a year, and they pay an effective tax rate of 16.6 percent. How is that? All right. The top 400 wealthiest people in this country earn $345 million a year, and they pay an effective tax rate of 16.6 percent. They do not need an extension of tax breaks.
By the way, for the United States of America, this effective tax rate of 16.6 percent, on average, is the lowest tax rate for the very rich in America that there has ever been. So we have already given the wealthiest people in this country the lowest effective tax rates in the history of our country, at least since they have been keeping records. That is what we have done. So the idea of giving these guys--who are doing phenomenally well, who already own more wealth than the bottom 90 percent--more tax breaks is totally absurd.