Katrina Housing Tax Relief Act of 2007

As I come to the floor tonight, the first week of December, standing here in the Nation's Capitol of the greatest Nation on Earth, today, and has ever been, I think about our constituents back home in the great State of New Jersey and across the country as well as they look to our Nation's Capitol and expect us to do the responsible things on their behalf and on the behalf of freedom and liberty around the world as well. And a portion of that responsibility, of course, is handling their hard-earned tax dollars as they send them to us here in Washington to administer this government and spending, some of which was just addressed by the other side of the aisle.

For the next hour, I would like to engage in a discussion of these issues and shed some light on them, perhaps pointing out some of the fallacies in some of the arguments that we just heard from the other side of the aisle on these points.

As we begin there, I think there is no place better to begin as to try to address some of those points that have been raised. So at this time I would be honored to have a fellow colleague join us at the floor right now. I yield the floor to Ms. Foxx.

Will the gentlelady yield?

I think the gentlelady makes an interesting but important point at the same time, in that if we see our role here in Congress as to satisfy every desire, wish, whim, and I am not saying education is a whim, but desires, wish, needs, as well of our constituency back at home, in your State and mine, then of course that wish list or the desire list or that need list would go on ad infinitum. Then we can become here, as one may say, as the 51st State, the 51st State legislature, trying to solve every single issue, whether it's building new schools, filling in potholes back at home on the street in front of someone's house, or any other minutia that is back in the States. Obviously, some of these things are quite vital to you and I and our constituents, but the question is where do those dollars and cents come from, where do the responsibilities lie? If we are going to assume at all, then I can tell you that this budget is going to balloon even further than where the Democrats already want the budget to balloon.

But it is, just as you said before, an issue of, and I will probably say it 22 more times before the night is over, an issue of setting priorities, and part of setting priorities is setting what are our responsibilities. So you hit the nail on the head when you begin to look at that, how do you set priorities, what is our responsibility. If we can just hone in on what our responsibility is and if we can get doing those things well first, then everything else comes in time.

I yield back.

I thank the gentlelady from North Carolina, and I do believe that the American public is paying attention; and they are doing better than that, they are reading between the lines. And they know when they are being talked to straight and honestly, just as you have been for the last few moments now setting forth what the record is with regard to what the Republicans' intentions have been and will be in the future with regard to getting the fiscal house in order of this country, and what the actual record has been for the last 11-plus, almost 12, months now, as we stand here under Democrat control.

Some of the numbers, I must say, that we talk about when we discuss this issue are quite large. It is really hard to get your hands around them, to get a handle on them. When you are talking about total spending in 2008 in the fiscal budget of $2.9 trillion, who can imagine that size number? When you are talking even a smaller number about an increase of $118 billion over 2007, $118 billion? We just can't relate to it.

What we have to all bring it right down to is the fact that this is the American public tax dollars at heart, and it does mean dollars and cents to people at home listening to us tonight, working all week long, paying their bills. It does mean something to the American family's budget, how the tax increases that have been proposed by the other side of the aisle are going to impact upon them and their lack of responsibility when it comes to the issue that curbing spending will have an impact upon them as well.

I am very pleased that I have been joined here tonight by another strong stalwart leader on this entire issue of fiscal responsibility. I have the pleasure of serving with him on several committees, but most importantly right now on the Budget Committee where he has been an outspoken critic of wanton expenses and spending, both now under Democratic control but also, too, when the Republicans controlled. So I would like to yield such time as he needs to the gentleman from Texas.

I again thank the gentleman from Texas for your work and for coming to the floor and for the points you make here.

You point out several significant points. One is the dichotomy between what has been said by the other side of the aisle, both before the election and now during the course of the year, and literally just moments ago before I came to the floor this hour as the Blue Dogs were on the floor speaking.

Let me take a moment to remind those here with us what was said by the other side when it comes to fiscal responsibility and their ability to get going rolling forward, because the gentleman from Texas made reference to the point we are likely to see an omnibus bill that none of us had an opportunity to consider, just as has been the case with other bills that have come to the floor.

Back on November 8, 2006, a little over a year ago, Democrat Speaker Pelosi said Democrats are prepared to govern and ready to lead.

Would that be true, whether she was prepared to govern and lead a year ago, here we are a year later, and we are still waiting for their appropriation bills to make the way through the process. Here we are in the second week in December, which means we are already, October, November, December, all those months, a quarter into the next fiscal year, and we are still waiting for those appropriation bills to make it through the House, Senate, and onto the President's desk. Were they really ready to lead a year ago if they can't get it done at this point in time? I guess not.

A year ago their Democrat caucus chairman, Mr. Clyburn, said Democrats offer a new direction which includes fiscal responsibility. If you just put the period after ``they offer a new direction,'' maybe that would be more telling. Their direction is deeper in debt for the country, and therefore for the American family's budget as well, because their solution is always increase taxes.

You might find that odd to think their solution is always to increase taxes if you simply listen to their rhetoric, because back in March of this year their majority leader said there are no tax increases in this budget, referring to the budget which came through the Budget Committee and eventually came to the floor of the House.

If there are no tax increases, why do we know that the tax increases are going up significantly, upwards to $400 billion on the American public because of the bills that the Democrat majority has put through?

I would point out to the gentleman from Texas that just prior to coming to the floor, the other side was speaking. It was the Blue Dog Democrats, and their solution, and you don't have to, as the gentlelady from North Carolina

says, read between the lines. Their solution to this issue of fiscal responsibility is only one-sided, and that is revenue, revenue enhancement, which is a nice way of saying tax increases.

How do we know that? The Record proves the case. The chart to my left shows the Republican minority attempted during various appropriation bills that were coming down to say that maybe the solution when your fiscal house is not in order is not always to raise taxes; maybe part of the solution is to rein in spending, something that every family has to do from time to time. When an American family has a problem with their budget and they are not able to make ends meet at the end of the month or week, what do they do? They usually have to rein in spending and set priorities. We suggested that. I know that the gentleman from Texas was part of this process as well to suggest perhaps what we should do is not make any draconian cuts, not say we are going to eliminate this program or that program, although some programs are certainly worthy of being eliminated. We had a much more modest proposal, and that was simply to say can we go for a 1-percent reduction in spending.

What was the Democrats' response to that? Well, on bill after bill after bill after bill, one, two, three, four, five, six, seven of the House appropriation bills proposed by the House Democrat majority, on each case we suggested can we afford a 1-percent across-the-board reduction to try to bring our House in fiscal responsibility.

I would definitely yield.

I appreciate that point. The gentleman is absolutely correct. It is not a reduction in overall spending so we can say today we are spending a dollar and tomorrow we would be spending 99 cents. In fact, today we are spending a dollar and we may be going up to $1.05, let's bring it down to $1.04-something as far as the actual spending. So the actual spending would still be going up, but we were suggesting going up on a slightly lower curve.

Democrats voting in favor of that modicum of fiscal responsibility. Well, we could get into single digits several times, with 10, 7, 11, 13, 11, 11, 11; only 11 votes out of that entire side of the aisle. I'm not sure where any of the Blue Dogs were on that one when they had the opportunity to rein in spending.

You know, I think if I recall correctly, and you can correct me if I'm wrong, the reason they said that they could not be supportive of being more fiscally responsible and support any measure was that we were not being compassionate enough. But the element of compassion in Washington, DC. apparently is measured by simply how much more money you throw at the problem. Whether or not that program is efficient, whether that program has been rated as being adequate and getting the job done, the measure of compassion in Washington is always whether or not you are throwing even more money than the party next to you is doing.

I guess it comes down to a very simply thing like this: at the end of the day they want to be able to go home to their kids or grandkids and say, well, we were more compassionate than those Republicans because we spent more money than they did on a particular problem.

I shall yield, yeah.

Just a quick two points, one on the compassion issue is perhaps it is appropriate when you're dealing with money to say that if I'm taking money out of my own pocket and deciding that I will spend this on a particular program, I can honestly say if I wish to be so boastful that I am being compassionate for that individual.

But we know that the Federal Government is in debt right now. We are involved in deficit spending, which means that we are not only spending more money than we are currently taking in from the current taxpayers in this country, but also we are going into debt borrowing as well. So where are we borrowing from?

Well, we are borrowing from the next generation. So in that hypothetical conversation that a Member from the other side of the aisle must have when they go back to their children and say, well, I was compassionate today because I decided to vote ``no'' on all these fiscally responsible measures that the Republicans propose as far as reining in the spending on this side. Well, the compassion that the father or mother Member would have to say to his child, I am being compassionate because I am simply basically giving you an additional debt on my children, and my children and your children will be obligated for all of these expenses.

Now, to the other point that you were raising as far as the letters and the phone calls that you get from your members or from your constituents who are concerned about what we are doing here and that they are on the brink of foreclosure, or brink of fiscal solvency in their own right, well, that's perfectly understandable, especially in light of all that has transpired over the last 11 months with regard to new taxes that have been proposed by this Democrat majority. And I'll just refer to the chart here for a moment. And if you care to speak on any of these, you're welcome to.

These are new majority proposals, new taxes at every turn. I digress. What was Senator Hillary Clinton's statement with regard as running as a Presidential candidate, which I believe she said something to the effect of, I have more ideas than this country can afford to spend dollars on, or something to that effect. Well, apparently the other side of the aisle, the Democrat side of the aisle, has the same idea, that they have more proposals, more bright ideas to spend on than we

have money in the bank nor does the American family have in their bank as well. But they're going to still go and try and spend them, and they're going to do it by raising taxes.

So what do we have here? One, two, three, four, five, about seven different new tax proposals. Fiscal year 2008 budget $392.5 billion tax increase. Of course the gentleman from Texas recalls that we saw that at the very beginning of this year in about March or April of this year when we saw at that time that was the largest tax increase in U.S. history. The largest tax increase. And where is that going to be on? It's going to be on the backs of American families.

Secondly, $15 billion in new energy taxes. Well, we just passed 2 weeks ago, or last week I guess it was, we passed the energy bill, and that's even in addition to that as far as the tax increases that will be on energy production in this country. $5.8 billion in new tobacco taxes, $7.5 billion, again these are all in billions. If you can't get your hands around it, those large numbers, but that's what we're talking about. $7.5 billion in new taxes in the farm bill. A nickel- per-gallon tax increase on gas for infrastructure. So if we're not already paying enough at the pump and, remember, that also was one of the promises that the gentlelady from North Carolina was referring to before, a whole list, before you came in a whole list of promises made by the new majority that they were going to do.

One of them was an energy policy to reduce the price of gasoline. I can tell you in my neck of the woods prices are higher now substantially than when the majority came in. Now they want to add a nickel tax on top of that. A 50 cent-per-gallon tax, increase on gas for global warming. So now you're up to 55 cents on gas.

New taxes on homeownership by ending mortgage deductions and a new tax on every American with a private health plan. And actually this list is an abbreviated list that can go even further than this as far as taxes on the American public.

And with that I'll yield to the gentleman.

And if the gentleman will yield.

The gentleman and I also, besides being on the Budget Committee, I also have the honor of serving with him on the Financial Services Committee. And one of the issues that we're dealing with right now of course is with the subprime situation, subprime situation as far as the tightening of the credit market of course and the decline of home prices that is probably going to continue for some period of time, peaking with regard to the resets sometime in February or March of next year. But most experts would agree that the price of homes in this country on average will be going down 3, 4, 5 percent; and this will continue during the course of 2008. And it's one of the reasons, as well, why we see consumer confidence beginning to erode, after a substantial period, a lengthy period of where consumer confidence was up.

So when you think about the economic situation of the American family right now, energy costs going through the roof. I heard a figure the other day, I think they said on average American homeowners are going to spend around $2,000 more this year just to heat their homes. There's 2,000 bucks more out of their wallets. That's in addition to more money out of their pockets for gasoline, going to and from work. And that's in addition to the fact that the values of the house in certain pockets of this country will be going down. Their financial situation for the American public is being constricted.

And what is the solution that we are hearing from the other side of the aisle while the family budget is being tightened like that?

Well, it's Uncle Sam reaching out and saying, can we have, Washington, have 2, $3,000 more so we can spend it down here on who knows what. And some of those who-knows-whats, you remember earlier on in this year, with all the pork spending that was coming from the other side of the aisle, you recall this discussion of some of the pork that was thrown into legislation, $50 million for wild blueberry subsidies, farm bill, $17 million for the National Sports program, $20 million for the National Writing Project, $6 million for unused plane tickets, $36,000 for Kentucky to protect bingo halls and on and on infinitum.

Anyone who listens to the gentleman from Texas or the gentleman from Arizona talk about earmarks will know about the wasteful spending that goes on here. But that's what's going to continue to go on so long as Washington is controlled by the other side of the aisle that says we can continue to spend without limitation because we are not setting those priorities. But we will be willing, the Democrats will be willing to reach out and take more money out of the family's pocket. So that really is the issue here at home.

And I always remember this expression from the gentleman from Texas: the focus has got to be on the family budget and not on the Washington budget. The other side of the aisle obviously has misplaced that axiom and has put the focus entirely on the Washington budget, as opposed to the Federal, the individual budget.

Again, if you were here earlier when the other side of the aisle was saying that their solutions to the fiscal dilemma that we're in right now and the problems need to be addressed in a fiscally responsible manner, never once during that entire hour discussion, and never once during any of our hearings that I can recall in the Budget Committee, have we heard from them the basic suggestion that the answer lies in the spending side of the equation as opposed to revenue.

In Washington, we really do have a spending problem, not a revenue problem. The revenue continues to come in at unprecedented rates, and that despite the fact that we had tax cuts going back as far as 2003, despite the fact that we lowered the tax rates for Americans so that they can keep more money in their pockets. The amount of revenue coming into Washington continues to go up, most times over the last several years, actually in the double-digit range year over year.

So it's not a revenue problem that we have experienced. It is a spending problem. I'm just waiting for the day that the other side of the aisle begins to realize that and will begin to work with us on some of these issues that you and I and others in the RSC as well have decided is the appropriate approach, reining in this budget as the family does.

And to get an idea, again, as to how that all plays out or actually where that all comes from, I gave you before a list, just a partial list of the tax increases that would be coming down the pike under the new Democrat majority.

Let's look at it as you would look at your own income tax return in a way. Part of the tax increases that you will see will go from the top to the bottom. So you can say compassion to either the richest or the poorest. The ordinary income tax at the top rates will be going up, 35 percent to 39.6 percent. Capital gains tax, which are not only for the rich, it's for our senior citizens as well who are relying on their retirement accounts, the annuities that they have put away during the course of their life, their pensions and the like which are invested, and now they're taking those funds out as far as capital gains. That's what they're living on on a fixed income. What do we see there with capital gains, 15 percent to 20 percent. That's a 5 percent increase, or actually a 30 percent increase over the 15 percent.

Dividends, likewise, increase 15 percent up to 39.6 percent, more than a double increase there.

Estate taxes. Well, estate tax, of course, is something we've debated on this floor for a long time, for the small farmer, for the small business person. Their taxes are going to go from 0 percent to 55 percent, basically making a lot of small farmers and little families when they sit down at the end of the year saying we may actually have to sell our business to hold on, and this is why.

Finally, for the lower income tax bracket, child tax credit from $1,000 to $500. Now, to people who actually really need that money, that extra $500 can be crucial. That could be a month's rent payment. That could be a food bill. That could be a car payment. They're reducing it from $1,000 down to $500.

And finally, the lowest income earners, the bottom income individuals and families in this country, they, too, will be bearing the brunt of the tax increases and the prolific spending that we see down here by seeing the lowest tax bracket go from 10 percent to 15 percent. Percentage-wise, of course, that's a 50 percent tax increase when you think about it, from 10 percent up to 15 percent, as far as a percentage increase.

So from the richest to the poorest will all be suffering, and the dollars and cents, as you make out, the gentleman from Texas, very well, comes out to how they pay their bills at the end of the month.

I yield back.

I thank the gentleman again.

You can see this sort of going on in a microcosm from the State that I'm from, the great State of New Jersey, where a poll was done a month or so ago I understand that said if you had the opportunity, would you leave the State, and 50 percent of the respondents said, yes, they would. If you look at the actual demographic numbers over the last year, between 72- or 76,000 New Jerseyans have left the State of New Jersey. One of the reasons why they indicate they've left the State is because taxes are so high. They cannot afford to live in that State. So the individuals leave, the families leave, businesses leave the State, which will cause obviously a death spiral, if you will, to the overall economy of the State of New Jersey if it's going to continue.

I'm sure the gentleman would like to have them. I would like them to stay in the State of New Jersey and just see that our fiscal house is set in order in the State of New Jersey, where the Democrats just raised the sales tax by a penny and corporate taxes as well, and property taxes continue to go through the roof.

But that's a microcosm of the United States of America as well. People are doing what Ronald Reagan once said, and that is they're voting with their feet and leaving the State. Businesses will be doing the exact same thing as we begin to see taxes go up across the board in the United States if those hard decisions are not being made of prioritization.

I believe we're getting near the end of our time here. I will extend a hand to the other side of the aisle, as we continue this debate during the course of the week, to the Blue Dogs or any other Members who came down to the floor during this night or other nights as well who are looking for fiscal responsibility. If we can come to an agreement that the answer is not raising taxes but, rather, reining in spending, I believe it was the RSC a year ago that came up with a list of, correct me if I'm wrong, approximately a half a billion dollars in savings in overall spending by the Federal Government. We'd be glad to share that information with the Democrat majority if they would just take even just less than 5 percent of that to rein in their spending to keep it under the control of where the American public would like to have it.

I thank the gentleman from New Jersey for leading this Special Order this evening. I thank him for his leadership on behalf of the people of New Jersey and behalf of the people of New York. The gentleman from New Jersey (Mr. Garrett) never loses an opportunity to fight for the family budget.

And we know that families are struggling during this Christmas season; we know that their energy bills have increased. We know the price at the pump is high. Home heating oil for those, particularly in the Northeast, not in my part in the country in Texas, they face challenges there. They face challenges in trying to deal with their health care costs.

And what is the answer of this new Democrat majority? Well, it is the same answer as all Democrat majorities: tax more and spend more.

I am unacquainted with any society in the history of the world that somehow has taxed its way into prosperity. And, ultimately, more spending leads to more taxation; and this is a Congress that continues to spend more and more and more. Already, the Federal Government is spending on average over $23,000 per family of four, Mr. Speaker. And this is the highest level, the highest level since World War II on an inflation-adjusted basis. And yet this Democrat majority wants to spend even more of the people's money.

Earlier in the year, in their budget they had the single largest tax increase in American history that, when fully implemented over a 5-year period, is going to add $3,000 per year for an average family of four.

Now, I wonder, Mr. Speaker, what will that extra $3,000 in taxes taken away from American families to be given to the Federal Government, what is that going to do to the hopes and dreams of the average American family? How is that going to help them fill up their F-150 pickup trucks? How is that going to help them pay their home heating oil bills? How is that going to help them send a child to college? Well, the answer is that it is not.

Often, when we are having spending debates in the Nation's Capitol, Mr. Speaker, we are not really debating how much we spend, but we are debating who is going to do the spending. Is it going to be American families? Are they going to be allowed to keep what they have earned, what they have worked hard for? Are they going to be able to keep the bread on their table? Or are they going to have to give even a larger share to Washington? Notwithstanding the fact, notwithstanding the fact that they are already paying on average $23,000 per family of four.

Now, when you come to the floor of the House, you often hear our Democrat colleagues decry how we are not investing in this budget function or we are not investing in this budget function enough. Well, people are entitled to their own opinions; they are just not entitled to their own facts. And if you look over the last 10 years, for example, the international affairs budget has increased 130 percent; the energy budget, 293 percent. Now, transportation, 71 percent; health, 79.4 percent. And the list goes on and on. And in that same 10- year period, the family budget has grown by about 34, 35 percent. And so you have government on average growing over twice the rate of the family budget, and inflation over that same period has been just a little over 2 percent. So if you wanted to keep the same government that you had, you would have grown it at 2 percent a year; and, instead, it is being grown at closer to 6 to 7 percent.

Ultimately, American families will not be able to pay this bill. More and more taxes are being imposed on them. And so every time one of our Democrat colleagues comes to the floor to suggest another great new government program to be added to the other 10,000 programs, Federal programs that are already on the books, it puts pressure on the family budget. And, again, it is not fair to their dreams, their hopes, their aspirations for their families, on top of this $3,000 a year increase to the average family of four that will be phased in over 5 years in their budget. They have gone through and offered to increase taxes at least half a dozen times on American families and the American economy.

We passed H.R. 6, $7.7 billion over 10 years; H.R. 976, $1.3 billion over 10 years; H.R. 1562, $241 million over the next 10 years; H.R. 2419, $12.1 billion, and the list goes on and on and on.

Again, as Americans are striving to pay for their health care costs, their transportation costs, their education costs, why should they be giving more money to Washington, D.C.? And at this time when they are trying to make ends meet on top of the tax increase in their budget, on top of at least seven or eight tax increases propose this year, you have the chairman of the Ways and Means Committee, the gentleman from New York (Mr. Rangel), propose what has now become known in the press as the mother of all tax increases.

He will put a huge, almost 30 percent tax on millions of small businesses all across this Nation. Ninety percent of all Americans will pay more taxes under this bill. It will bring in an estimated $3 trillion taken away from American families and American small businesses. This threatens millions of jobs.

If we truly care about the American family and the economic perils and struggles that they face, then we want to make sure, number one, they keep the job that they already have instead of sending jobs overseas through excess taxation, regulation and litigation. And again, all of this spending ultimately has to be paid for, and it has to be paid for by a larger tax burden on

the American family and a job-killing tax burden on American small business.

So here we are when most American families are trying to put together a budget so they can participate and make sure that all of the children and grandchildren are taken care of at Christmas, and here we have a Democrat majority in Congress who are trying to pass an even larger budget, the largest budget in the history of the Federal Government, taking more money away from their Christmases, taking away the goodies in their stockings to feed this ever-increasing, tax-and-spend beast that they have created.

Again, I am unfamiliar with any society in history that somehow has taxed its way into prosperity, and that's what all this spending is resulting in now. So I am happy to join the gentleman from New Jersey to come to the floor now and make sure that the American people are seeing what is happening.

There is a process, and process ultimately leads to policy. We had a process in place that was supposed to pass separate spending bills so Members of Congress could actually read the bills. Wouldn't that be a novel idea, that you actually have an opportunity to read the bill before you vote on it. And Democrats would absolutely come to the House floor and criticize and excoriate Republicans if they didn't pass these bills on time, and now they have passed one out of a dozen. So they are going to roll them all into this thing called an omnibus, and the only bus quality about it is it is a fiscal bus; it is going to flatten the American taxpayer.

So, soon we will be presented with a thousand-page bill that we have hours to read that will be filled with pork-laden special interest projects which this Democrat majority claimed they were going to clean up. But instead, they have made it worse with all of their special earmarks, be it the tribute to the chairman of the Ways and Means Committee who takes $2 million of American family money to create a museum to himself; be it the gentleman from Pennsylvania who set up what the Wall Street Journal has referred to as Murtha, Inc., where now companies go out and hire lobbyists, and if they locate in his district, all of a sudden earmarks appear. There is no transparency there. There is no accountability there. But all of this is going to get wrapped up into one great big omnibus bill.

So when many of us would like to be with our families, and many of us have our families back home in our districts, not in Washington, D.C., instead we are here doing what we have to do, and that is protect the American families out there from this tax-and-spend machine that threatens their education and housing dreams, threatens their health care dreams, to ensure that the Federal budget does not grow beyond the ability of the family budget to pay for it.

Already the unfunded obligations of the Federal Government are in excess of $144,000 per individual, and yet the Democrats keep on spending along. There will be a day of reckoning. And so I am sure that the Democrats will come to this House floor and say we are only debating $22 billion in this omnibus spending bill.

Number one, I hope I am never in Washington so long that I have concluded that $22 billion is not a lot of money. $22 billion is more than we are spending on veterans health care in this Nation. It is a lot of money. And due to this artifice called baseline budgeting, that is going to grow in 5 years to be a $200 billion figure, imposing again thousands of dollars of taxes on the average American family when they are struggling to make ends meet.

And so this debate is really about two different roads. One road leads us to the largest tax increase in American history to be followed by an even larger tax increase in American history, one that threatens our children and grandchildren with a lower standard of living. And that is not my words. Those are the words of the comptroller general, the chief fiduciary officer of the Federal Government. He said right now the government we have, and I paraphrase, the government we have, if left on automatic pilot, no new spending programs, no new benefit increases, threatens the next generation with either, one, a doubling of their tax burden or, two, a Federal Government that consists of little more than Medicare, Medicaid and Social Security. And yet the Democrats won't reform these programs. They keep on taxing and they keep on spending.

I don't plan to be a party to that. There is another path. It is a path to fiscal responsibility. It is a path to make sure that the Federal budget does not grow beyond the ability of the family budget to pay for it. That is why Republicans will come to this House floor to make sure that this omnibus doesn't run over the American taxpayer and to make sure that the American people can have greater freedom and opportunity than we have had before. But to do that, we have to put America on the path of fiscal responsibility and to live within a budget.

Don't let the Federal budget grow beyond the family's budget to pay for it. You cannot grow government at 6 and 7 and 8 percent a year and have the family budget grow at 3 percent a year. You can't sit here and tax American families at 3 and 4 and $5,000 more per year and then somehow claim that you have the Nation's priorities right. The priority of this Nation ought to be protecting the pocketbooks and security and freedoms of the American family.

So again, I thank the gentleman from New Jersey. He is one of the stellar leaders in this body in fiscal responsibility. He is a man who is always committed to principle, a real workhorse in this institution, and I am honored to be on the House floor tonight.

Would the gentleman yield on that one point?

Correct me if I'm wrong, but isn't that really a 1- percent reduction in the requested increase? And so, for example, the Democrats may have suggested that some account grow by 6.7 percent, and this amendment said no, let's let it grow at 5.7 percent instead. So what we are calling a reduction, was that not really a reduction in the requested increase? Because at the end of the day, the Federal budget was still going to grow.

Would the gentleman yield on that point?

It is interesting. Rarely do you come to the House floor that somebody says, don't you have compassion? Don't you want to take money away from this American family and hand it over to this program over here?

And, again, I want our society to spend more money on education. I want them to spend more money on health care. I want them to spend more money on housing. I'm just not indifferent as to who does the spending. I want American families to do the spending. They want the Federal Government bureaucrats to do the spending after taking a huge hair cut for all the waste and fraud and abuse and duplication that takes place in the Nation's Capitol.

What I hear from my constituents, and I have the great honor of representing the Fifth Congressional District of Texas, which is Dallas and east Texas, and I hear from people like the Kirkendahls in Garland who wrote me: ``Congressman, at this point, between taxes and utilities we are at the breaking point of being able to keep a home. If we have an increase of over $2,000 per year in taxes, it may well be the straw that broke the camel's back.''

Well, where is the Democratic compassion for the Kirkendahl family as they try to keep their home?

I heard from the Taylor family in Forney, Texas also in my district: ``Dear Congressman, I'm on the verge of foreclosure after 15 years in my house. I won't be able to make it if taxes continue to rise.''

Well, where is this Democrat compassion for the Taylor family in Forney? I'm having trouble seeing it.

And so they forget about the people who actually do the work and pay the taxes, because it's their dreams once again. And so compassion, I believe that compassion ultimately shouldn't be measured by the size of a government check. It ought to be measured by the size of a paycheck. And all this Democrat spending is fueling more taxes, which will kill the jobs, kill jobs in this American economy. We start replacing paychecks with welfare checks; there's no compassion in that.

And I'll yield back to the gentleman from New Jersey.

Well, I thank the gentleman for yielding once again. And it is sometimes difficult for people to understand billions and trillions of dollars. But they certainly understand hundreds and thousands of dollars coming out of their paycheck. And so to put this in some kind of context, this largest single tax increase in history that was part of the Democrat budget resolution earlier this year, that equates to roughly $3,000 per year per family of four tax increase, $3,000. So I hope people all across America who are listening to this debate will listen very closely and write their Members of Congress, call their Members of Congress, e-mail their Members of Congress.

Do you really want that $3,000-per-year tax increase on your family? Can you afford that, to send more money to Washington, D.C. when they're already spending an average of $23,000 per family of four, the highest level since World War II?

I'd be happy to yield to the gentleman.

I thank the gentleman for yielding once again. And although I haven't kept a running tally, to the best of my knowledge, I'm unacquainted with any Federal program that has met its demise in this Congress. Instead, when you think about the 10,000 Federal programs that are already on the books, this Democrat majority is adding to them, with the exception of one agency in the Department of Labor that's supposed to provide accountability to labor union bosses to make sure that they don't misuse labor union funds. That was the only single agency that I'm aware of that has received a budget decrease of roughly 10,000 Federal programs, one to ensure the integrity of labor union funds to be protected from misuse and fraudulent use and criminal use by labor union bosses.

And so, again, the tax and spend machine goes on. And American families have to decide for themselves as they watch this debate during the holiday season what's going to be best for their families. Do they want to have a tax

increase in the neighborhood of $3,000 per family of four? Is that going to help them? Will sending that money to Washington help them with their fuel bills? Will sending that money to Washington better help them send their children to college? Will sending that money to Washington help them meet their mortgage payments, particularly if they have an adjustable rate mortgage and it resets?

We're talking about the here and now, but we also have to look at the future. As the gentleman was talking about, we hear the word ``compassion'' thrown on this floor frequently. People will quote scripture and talk about what have you done for the least of these. I always thought the least of these were those who do not vote and those who have yet to be born. They're the ones who tend to get ignored in this process.

So why now with all of this spending that the Democrat majority is doing, where is it leading us? Well, let me quote from the Chairman of the Federal Reserve, Ben Bernanke: Without early and meaningful action to address the growth of the Federal budget, particularly entitlement spending, the U.S. economy could be seriously weakened with future generations bearing much of the cost. Again, where is the compassion there?

Let me quote from the Brookings Institution, not exactly a bastion of conservative thought: The Nation's fiscal situation is out of control and could do serious damage to the economy in coming decades, sapping our national strength, making it more difficult to respond to unforeseen contingencies and passing on an unfair burden to future generations. Again, the least of these.

The General Accountability Office: The rising costs of government are a fiscal cancer that threatens catastrophic consequences for our country and could bankrupt America.

And these aren't my words. These aren't the words of the Republican minority. I mean, this is the Chairman of the Federal Reserve, the head of the General Accountability Office, the liberal Brookings Institution.

I thank the gentleman from New Jersey in talking about how terrible these tax increases are going to be on the American family, but it will be not only in direct terms to having a lesser paycheck, it also threatens the very existence of their paycheck.

I toured a small business in my district about a year ago called Jacksonville Industries. They're kind of an aluminum dye cast manufacturer, and before we had passed tax relief, they were on the verge of having to lay off two people.

And when I look at what's happening in capital gains and dividends, which really help fuels job creation, you can't have capitalism without capital.

Because of the tax relief the Republican Congress has passed, they were able to go out and buy some new machinery. I don't recall what it's called, and I don't exactly know what it does, but it was big and it was noisy, and most importantly, it made them more competitive. And because they were more competitive, and I want to say they had about 20 workers, instead of laying off two workers, they hired two new workers, all because of tax relief. Tax relief allowed them to invest in the American free enterprise system.

And so instead of having four people who could have been on unemployment and four people who could have been on welfare and four people who could have been on food stamps, instead, you had four people who had jobs, who had a future, who put a roof over their head, who put groceries on the table because of a paycheck, and yet the Democrat tax increases threaten that very paycheck.

Now, they offer compassion. Oh, we have this welfare check over here. We're going to increase the government budget over here. But you cannot increase the Federal budget without decreasing the family budget, and that's what this debate is going to be about this week.

Which path do you want to be on? Do you want to be on the path of increasing the Federal budget, threatening future generations with bankruptcy, with this fiscal cancer that's going to grow throughout our Nation, or do you want to be on the path where the Federal budget doesn't grow beyond the family budget ability to pay for it, a budget that doesn't include tax increases at a time when American families are struggling to pay their health care bills, their heating bills, their housing bills?

That's what it really is. It's a debate about two different paths. Now, they may look small to Democrats. They claim $22 billion isn't a lot of money. Maybe $22 billion today, and that is a lot of money, but that's quickly going to grow to $200 billion, and within a generation that's going to cause a doubling of taxes on the next generation. And children and grandchildren of America, if we don't stop this and stop it this week, will have a lower standard of living, less freedom and less opportunity, and that's why it so's critical that we win this debate this week.

Would you be happy to tell the citizens of New Jersey who are fleeing the high taxes that they can come to the Lone Star State where we have low taxes and great economic growth? We'd be happy to have them.

Thank you so much, Congressman Garrett. I appreciate your putting together this Special Order tonight and focusing on spending and on where we are here, as you said, in the second week of December in the greatest country in the world.

I was listening for a few minutes to our colleagues who preceded us, who called themselves the Blue Dog Democrats, and I was really fascinated to hear them talk about how fiscally responsible they have been, and I know that you're going to talk a little bit later about the total tax increases that they have proposed, the total spending that they have proposed. And I am fascinated that our colleagues can stand

here and talk about being fiscally responsible, I think, and assume that nobody is adding up what it is they are doing. And they show their charts about the debt and how much each person is responsible for that debt, and I am intrigued that if you look at the record, you would see that most of the Blue Dogs vote every time for these fiscally irresponsible bills that are being brought up. So I want to say to the American people, if they believe that these folks have been fiscally responsible, then I have got some swampland in Mexico that I'd like to sell them.

I felt like, in listening to them, that I was like Alice in Wonderland, where the language means the opposite of what it is, or 1984, particularly 1984, where white is black and black is white. That is what it feels like when you're listening to them talk about being fiscally responsible. It's unbelievable.

One thing I do agree with them, it is about priorities, and it's obvious that their priorities and our priorities and the priorities of the American people are two different things. For one thing, our colleague used the example that we could be building 12,000 new elementary schools. Well, the Federal Government has absolutely no business building elementary schools. There is absolutely nothing in the Constitution which gives us any right to be involved in education, and particularly in building buildings at the local level.

I am astonished at some of the things that they say, again, and assume that nobody is going to question them.

Well, I hope you will repeat that 22 more times tonight, and we need to be repeating that every single day. It's one of the issues I talk about over and over again, what are our priorities, what is the role of the Federal Government. As you say, we could be seen as a 51st State and be trying to deal with every single issue, but the Constitution is really clear about what our role is, I think.

As you point out, here we are in the middle of December, and what has this Congress accomplished? So much was promised by the majority last year when they were running for office and condemning Republicans for being profligate spenders and being irresponsible about the way we spent money. I will tell you that we can't hold a candle to what it is they want to do.

I think it was bad enough that Republicans before I got here ballooned the budget beyond where it should have been. And I have to say that I understand why the American people got upset with us last year, why we lost our majority. They felt that we were profligate spenders, as I said. But the Democrats promised something different. We are standing on our principles now, and they are stunned by that. We are earning our way back into the majority by living up to the image and the reputation that Republicans have had over the years of being careful with the way money is spent.

And, of course, today I heard other Democrats talking about the fact that this was going to be a cut in the budget. Well, only in Washington is a smaller increase than what they want considered a cut or level funding considered a cut. The increase in what the President asked for, and again I know you are going to go into much greater detail about this, a 3.1 percent increase in spending overall was requested by the President; and yet, the majority party is saying that the fault is with the White House and it refuses to negotiate, that the President won't negotiate with them. They say we are engaged in political posturing. If that isn't the pot calling the kettle black, I certainly have never seen that. They are totally surprised by the fact that the President and we are standing on our principles.

They think they can get by with simply increasing spending. They asked for $22 billion plus a lot of money in emergency spending; so then they come back and say, well, we will just split the difference. It will only be $11 billion and you should compromise with us. And the fact that we don't want to increase spending that much more over the 3.1 percent requested by the President stuns them. So the way they get around it is, here we are again the middle of December, and they have not passed the appropriations bills that we should have passed. And I want to talk some about what they promised they would do and what they have done. And we have compiled a list of promises.

On November 8 of last year, Speaker-elect Pelosi said: Democrats are prepared to govern and ready to lead.

Here we are, only one appropriations bill that has passed, and that is the Defense bill. Thank goodness that has happened.

Another Democratic promise: open, honest, and ethical Congress. Speaker-elect Pelosi: we will make this the most honest, ethical, and open Congress in history.

And what do we get? We get bills brought on the floor at the last minute, thousand-page bills. We get no time to read them, and we are asked to vote on them.

We are also told by the Blue Dogs and by others that they believe in something called PAYGO. Now, PAYGO, they would have you believe, is a way for us to get back fiscal responsibility. Well, I want to say that if you look up PAYGO in the dictionary, it means new taxes. That is what PAYGO means to them, new taxes. It doesn't mean cutting spending. And it only applies to a very small part of our budget, but they want to try to fool the American people into thinking that it means something different than what it means.

They criticize the Senate for having passed an AMT bill last week, which is a clean bill. It simply delays the increase in taxes that would go to about 23 million Americans, something they have never paid. And to the House, the fiscally responsible way to do this is to add new taxes to other Americans to, quote, pay for, that is, offset, taxes that have never been paid by another group of Americans.

That is some of the most twisted logic that I have ever heard in my entire life. I know that these people never could have taken logic in high school or in college.

They also promised no more borrowing from Social Security. But what that means is that the money that is currently being spent from the Social Security fund will not be spent from the Social Security fund. But that is not what they are doing. They are spending that and a whole lot more. And Rob Andrews last year, or this year, promised that we would not borrow any more money from the Social Security fund. Every one of their promises has been broken, and they are taking us down a very fiscally irresponsible budget.

The energy bill that was passed last week is a no-energy bill. It included nothing to increase domestic energy production. As Christmas approaches, 5,000 troops are going to return from Iraq; but they are holding hostage the bipartisan legislation to fund key benefits for them and their families. It has

been 6 months since the House overwhelmingly passed the veterans and troops funding bill and 3 months since the Senate did the same, but they have put that bipartisan bill into this omnibus bill that we are going to be dealing with, which will have billions in wasteful, unrelated pork.

We are seeing a tremendous problem here with only one of the 12 appropriations bills passed, a year wasted while they have brought before us unnecessary bills to vote on and while they have voted 41 times on measures to withdraw from Iraq, and they have let the important work of this Congress go by the by.

I hope again that the American people are paying close attention and reading between the lines on the things that they are saying, and I am going to yield back to my colleague from New Jersey (Mr. Garrett).

Mr. Speaker, I am pleased to rise in support of H.R. 1562, the Katrina Housing Tax Relief Act of 2007, which was introduced by my friends, the chairman and ranking member of the Committee on Ways and Means.

It is unfortunate that we continue to deal with the aftermath of the devastating hurricanes of 2005. The imprint left by Hurricanes Katrina and Rita on the Gulf Coast has been well documented. Unfortunately, the slow pace of recovery has also been well documented, despite substantial efforts by the Ways and Means Committee and the Congress as a whole to provide direct and indirect support to the rebuilding efforts.

As part of that effort, the Congress enacted the Gulf Opportunity Zone Act of 2005. Among its provisions, the measure authorized a tenfold increase in Section 42 low-income housing tax credits for States in the Gulf Opportunity Zone. At the time, our hope was that putting a fast expiration on those credits would lead to the rapid rebuilding of this much-needed housing. Our experience, however, has shown otherwise. Delays in getting necessary permitting and insurance, combined with the high cost of materials and a shortage of skilled labor, have created a situation in which many of the allocated credits are likely to go unused by the current December 31, 2008, deadline.

The good news for the GO Zone is that credits not used by the end of 2008 will not be lost. Instead, they will revert back to the State for future allocation. But the difficulties on the ground create uncertainty as to whether these projects will be placed in service by the end of 2008.

Witnesses at an Oversight Subcommittee hearing earlier this month warned that many deserving projects that had been allocated credits in Louisiana and Mississippi by the State housing agencies are going unfunded and therefore will not be built by the end of next year.

The measure before us makes several changes to the rules governing low-income housing tax credits in the GO Zone. These changes expire at the end of 2010. Hopefully, the modifications we are making today will allow the States to get these housing projects financed and constructed long before that sunset date.

It is my understanding from the Joint Committee that the cost of this bill is not the result of additional credits being used. Rather, it is that credits will be used more quickly than expected under current law.

Under these circumstances, I believe the changes in the bill before us are an appropriate response to the unique and unprecedented challenges in the gulf coast region and will help ensure that goals of the 2005 legislation are met. Unique circumstances sometimes require unique solutions.

Finally, I would like to comment on a provision of the bill being used to offset these costs. As originally considered by the committee, the measure would slightly alter the circumstances under which the government can levy the assets of an employer for unpaid employment taxes. During committee considerations, questions were raised about the provision, and I am pleased that the bill we are considering today contains an important modification to the provision that ensures that employers who unknowingly fall behind in their payment of employment taxes are properly protected.

On that count, particular thanks are due to the chairman, the staff of the IRS and the Treasury and the staff of the Joint Committee on Taxation for their help in working through this difficult but important issue.

Mr. Chairman, let me again express my appreciation to you and your staff for working across the aisle to craft this measure that I hope will make it possible for thousands of residents of the gulf States to go home soon.

Mr. Speaker, I reserve the balance of my time.

At this time, I yield such time as he may consume to the distinguished gentleman from New York, a member of the Ways and Means Committee.

(Mr. REYNOLDS asked and was given permission to revise and extend his remarks.)

Mr. Speaker, I yield such time as he may consume to the gentleman from Louisiana (Mr. Boustany).

Mr. Speaker, I yield back the balance of my time.

I thank the gentleman for yielding.

Mr. Speaker, I rise in support of H.R. 1562, the Katrina Housing Tax Relief Act of 2007.

I am extremely grateful to Chairman Rangel, Ranking Member McCrery, Mr. Lewis, Mr. Camp, and the members of the Ways and Means Committee for their bipartisan support of this bill and for bringing it to the floor in this expeditious manner. As Chairman Rangel stated, it represents this Congress ``doing our part,'' he said, ``to make things right and that begins with helping people get back to their homes.''

Few needs are greater in the city of New Orleans and surrounding areas than affordable housing. One New Orleanian who currently resides in a FEMA trailer 1 hour north of the city surmises that many people want to move back to the city, but after looking at the rental prices has said, who could afford that? In the gulf coast, Katrina destroyed over one-quarter million homes. More than 30 percent of these losses involved affordable housing losses, most of which were rental properties.

Post-Katrina, the average rental payment in New Orleans has risen 70 percent. Before Katrina, Mary Wright of our city paid about $300 in rent. Now she pays triple that amount. There are folks who were paying about $500 in rent are now paying $850. New Orleans' population has diminished to only 237,000 residents from 437,000 before the storm. It is not because residents do not wish to return. It is because many cannot afford to return. The lack of affordable housing has caused not only a problem for citizens wishing to return, but it is also a problem for developers, planners, and investors who are strapped in their options to increase affordable housing. The lack of quality affordable housing that is sustainable discourages the return of a workforce and the restoration of the economy of the city.

The Low Income Housing Tax Credit is of great assistance to helping our people of the gulf region return home. The credits will be competitively awarded to qualified developers who are then put under the constant scrutiny by our State housing authority to ensure that the buildings that are built are quality affordable housing. The safeguard in the system also provides for 30 years of high-quality housing, and for 15 years the rental properties developed using these tax credits must be maintained as affordable units. Should the properties not continue to meet the criteria specified when receiving the reward, the IRS will recapture the tax credits.

In December of 2005, Congress passed the Gulf Opportunities Zone Act, and among other much needed tax incentives it included a significant increase in housing credits for the Gulf States, and a 130 percent basis boost in which they treated all regions as difficult to develop areas, thus allowing them more funding for rebuilding.

The gulf coast faces many obstacles to redevelopment. Extending the placed-in-service deadline for both the credits and for the treatment of difficult to develop areas will remove one of them by giving planners and developers in these communities a reasonable time to effectively reinvest in that community.

Finally, mortgage revenue bonds have provided over 3.5 million lower- income Americans affordable homeownership opportunities and another 1 million with rental housing opportunities. Since Katrina, they have backed many homeowners but their utility has been limited in that these bonds are typically for first-time home buyers only. Provisions in this legislation waive this requirement for those whose homes were damaged by the hurricanes. This will assist with the rebuilding efforts, allowing mortgage revenue bond proceeds to go towards refinancing home loans, to free up funds for the reconstruction of homes and renewal of families.

We need to do everything we can to facilitate recovery, and this bill removes critical obstacles to rebuilding the homes, rental properties, indeed the very life blood of the families of the gulf region. I urge passage and full support of this legislation.