[Congressional Record Volume 164, Number 102 (Tuesday, June 19, 2018)]
[House]
[Pages H5278-H5279]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SUCCESS OF THE TAX CUTS AND JOBS ACT
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 3, 2017, the gentleman from Minnesota (Mr. Lewis) is recognized
for 60 minutes as the designee of the majority leader.
General Leave
Mr. LEWIS of Minnesota. Mr. Speaker, I ask unanimous consent that all
Members have 5 legislative days to revise and extend their remarks.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Minnesota?
There was no objection.
Mr. LEWIS of Minnesota. Mr. Speaker, I am here today to bring good
news. Good news that often in this 24/7 media cycle goes unnoticed,
unremarked.
{time} 2015
It is the good news of legislation that works. It is the good news
that creates a growing and rising tide of economic prosperity for all
families, including, most importantly, the children of families who
rely on their parents' income in a growing economy.
I am here tonight to talk about the unheralded success of something
called the Tax Cuts and Jobs Act. Rarely has one piece of legislation
been so successful so quickly, and rarely have so many, at least on one
side of the aisle, predicted its success with so much accuracy.
We are now, according to a number of analysts, including the Atlanta
Federal Reserve, set to grow at over 4 percent the next quarter.
Consider that over the last decade, if not longer, we have barely been
able to scratch the surface at 2 percent GDP growth.
Now, after the Tax Cuts and Jobs Act, after more investment in
America, after more repatriation of profits coming home to invest,
after labor and capital coming together because our Tax Code now
incentivizes labor and capital to come together, we are seeing wages
going up.
We are seeing more capital investment. We are seeing bigger
paychecks. We are seeing economic growth over 4 percent. We are seeing
utility companies offer rebates under the Tax Cuts and Jobs Act because
they have to pass through the savings they got from tax reform to
customers.
It is remarkable how so many of our friends in the fourth estate seem
to have forgotten all the warnings about tax reform and tax relief. Oh,
I remember it well, Mr. Speaker. Last fall, last winter: This is going
to be crumbs. It is going to be Armageddon. It is going to be a
disaster if we pass the greatest tax reform in over 3 decades.
Now, some of us on the other side of the aisle, the Republican side
of the aisle, said: ``Wait a minute.'' Secretary of the Treasury Andrew
Mellon under Calvin Coolidge in the 1920s first embarked on increasing
the return for labor for capital investment, for economic growth. What
happened in the Roaring Twenties? It led to a balanced budget. Then, of
course, in the 1960s--and this is what my colleagues on the other side
of the aisle seem to forget--old-school Democrats like John F. Kennedy
went to The Economic Club of New York in 1962 and said:
What this economy needs in 1962 to break out of the
doldrums is a tax cut.
JFK said in that famous speech: ``Our practical choice is not between
a tax-cut deficit and a budgetary surplus. It is between two kinds of
deficits: a
[[Page H5279]]
chronic deficit of inertia, as the unwanted result of inadequate
revenues and a restricted economy, or a temporary deficit of
transition, resulting from a tax cut designed to boost the economy,
increase tax revenues, and achieve, I believe--and I believe this can
be done--a budget surplus. The first type of deficit,'' Kennedy warned,
``is the sign of waste and weakness. The second reflects an investment
in the future.''
Well, Mr. Speaker, if there ever was an investment in the future, it
is the Tax Cuts and Jobs Act. So JFK got his tax cut enacted after his
tragic death, and what happened in the 1960s? We had lower rates, but
we had more revenue. Now, how is that possible?
Our critics of our tax reform say: Oh, you can't cut rates and have
more revenue.
It is amazing how many people know so little about modern business.
If you are sitting in your local hardware store, if you have unwanted
inventory, what is the first thing you do to move product? You lower
the price. Why? Because you lower the price to sell more goods and
services, albeit at a lower price, but a volume increase for more
revenue.
It happened during the 1978 capital gains tax cut, the Steiger
amendment, when we cut capital gains rates and, actually, revenue went
up. Every single time we have cut tax rates in the modern era, the
``revenue loss'' has been nowhere near the predictions.
So in the 1960s, what happened? We had lower rates, and we had a
balanced budget by 1969. Higher revenues grew.
Fast forward to the 1980s. We had the doldrums of the Carter-malaise
era when we were told that the era of prosperity was over. We had to
put on our cardigan sweaters, button them up, and turn down the
thermostat because the good times were not coming back. Get used to it.
Ronald Reagan comes on board. He is pushed by the supply side
movement of 1970s and 1980s, and the Kemp-Roth tax cut. And he enacts
in 1981--in those days, a Democratic Congress when Democrats realized
that economic growth was actually a good thing and you want to
celebrate it, they enact Kemp-Roth, bringing the top rate down from 70
to 50 percent.
Now, there was a delay in 1982, you might recall, but then the tax
cuts finally kicked in, in 1983. By 1984, it was morning in America
again.
Revenues when Ronald Reagan took office were about $580 billion. By
the time the 1980s were over, Federal revenues were almost $1 trillion.
How could it be? How could it be that you cut tax rates and you almost
double revenue?
This is an amazing phenomenon that our critics of tax reform just
won't heed. They won't understand. They don't want to see it. They
don't want to hear it. But it is ironic. What is the first thing that
folks who say they want to reduce teenage smoking advocate? Mr.
Speaker, they advocate raising the taxes on cigarettes. Why? Because
when you raise taxes on something, you get less of it. You get less
activity.
Why is it that if you buy a bond, a 30-year bond or a bond in the
open market that is taxable, you demand a higher interest rate, but if
you buy a tax-exempt bond you will take a lower rate? Because people do
not work for pretax income. They work for after-tax income. And when
you lower the marginal tax rates and you increase after-tax income,
more people work. More people invest.
It happened in the 1920s. It happened in the 1960s. It happened in
the 1980s. And guess what? It is happening right now.
We have a 4.8 percent growth, 4.5 percent growth. Who knows, it may
just be 4 percent growth, but considering that we have been at 1.9
percent growth for so long, this is the miracle that keeps on giving
and yet won't be acknowledged.
Mr. Speaker, I will tell you why it won't be acknowledged by the
other side, because not one of them voted for it. Imagine, a tax bill
that doubles the childcare tax credit; a tax bill that lowers the tax
rates for mom-and-pop pass-through businesses by letting them deduct
the first 20 percent of income; a tax bill that says you don't have to
itemize any more to get a bigger deduction, and we are going to double
your standard deduction; a tax bill that puts America's corporations in
line with the rest of the world, not penalizing America's corporations
compared to the rest of the world.
Now we have foreign profits coming back. We have more mom-and-pop
businesses expanding. And we have a rising tide of economic growth, a
rising tide that lifts all boats.
I thought that is what this body was here to do. We are not here to
pick out groups, pick out winners and losers, to have some sort of
industrial policy where a command-and-control central government
decides who wins and who doesn't. You only gain if you are a political
entrepreneur.
The folks out in the real world, businesses and capitalists, they
invest for an economic return. But government all too often invests for
a political return. We have seen that form of crony capitalism, and it
gave us 1.9 percent economic growth. Now, instead of carve-outs and
loopholes, instead of favoring some States that like to tax their
citizens over States that don't, we have lower rates, broader but lower
rates for everyone, and loopholes for fewer, which means economic
growth is going to be determined by an economic return.
I don't know how else to describe this. It is an amazing success
story in the 115th Congress. Yet you would never know it listening to
the other side, listening to our friends in the fourth estate. It is
the story they don't want you to know.
But I am here to give you good news. The economic growth that is
occurring will keep occurring because people now have confidence. The
green shoots are back. The animal spirits are back. People are excited
to be in America. They feel good about their country. They feel this is
a place where they can fly as high as their wings can take them without
being hindered by the strong arm of the state.
That is what the American Dream is about. That is what the Tax Cuts
and Jobs Act is about. And that is what believing in America is about.
I am proud to have played a part in it, however small, and I am proud
of Congress for passing the Tax Cuts and Jobs Act.
Mr. Speaker, I yield back the balance of my time.
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