Floor Statements

Mr. Speaker, I supported H.R. 2143, the Unlawful Internet Gambling Funding Prohibition Act, which passed the House by an overwhelming 319-104 vote in 2003. I also voted in favor of H.R. 3125, the Internet Gambling Prohibition Act, in 2000. I supported reforming Internet gambling then, and I am pleased that Congress has decided to take up this issue again today.

Current regulations on Internet gambling are out of date and ineffective. Forty-eight State Attorneys General have already written to Congress asking for Federal Internet gambling legislation, and many sports organizations have echoed their support. Although States

have passed laws attempting to stem the tide against Internet gambling, it continues to occur with greater frequency, with more and more Web sites being created daily that explicitly target our children. These sites not only take advantage of young Americans who have no means to pay their debts, but also encourage a dangerous, and possibly lifelong, addiction. Equally problematic, online gambling also serves as a tool for criminals to launder money and evade taxes. We must ensure that this stream of funding is closed to those who seek to do harm to the United States.

While it is essential to protect an individual's right to engage in legal and honest gaming, I also believe we have a duty to protect the public from abusive and fraudulent websites that take advantage of minors and exploit the system for their own gain. H.R. 4411 walks the fine line between these goals and provides law enforcement with the tools it needs to aggressively crack down on illegal gambling. I support this legislation and am pleased at its passage through the U.S. House of Representatives.

Mr. Speaker, if I were present for today's vote on rollcall 363, passage of H.R. 4411, the Internet Gambling Prohibition and Enforcement Act of 2006, I would have voted ``aye''. In addition, I would have voted ``nay'' on rollcall 361, the amendment offered by Ms. Berkley, because I feel it would have undermined the intent of the legislation. I also would have opposed rollcall 362, the motion to recommit.

Mr. Speaker, I yield 10 seconds to the chairman of the Appropriations Committee, the gentleman from California (Mr. Lewis).

(Mr. LEWIS of California asked and was given permission to revise and extend his remarks.)

Mr. Speaker, I yield myself 5\1/2\ minutes.

Mr. Speaker, I am pleased to be bringing this bill to the floor today, and I would like to explain why we are doing this, why this is needed.

Just last year, according to the CRS or Citizens Against Government Waste, whichever group you want to talk about, we had over 10,000 earmarks here, totaling almost $28 billion.

Mr. Speaker, not every one of those earmarks came in just conference reports, but many of them did.

Mr. Speaker, we need more transparency and more accountability in how we spend the taxpayer dollars. In particular, Mr. Speaker, we ought to have the ability to be able to have votes on the individual merits of spending items, particularly those that we never have a chance to vote on, things that go into conference reports.

The earmark reform legislation that was passed earlier by this body did a lot to address bringing more transparency and accountability to the spending system as bills come to the floor. This is a perfect complement to that, the legislative line item veto, because after bills are considered, after conference reports are dealt with, we often find out that in conference a lot of things get put into those bills that we didn't get a chance to scrutinize. We ought to be able to vote on those things.

Now, how does this work?

And I want to get to the constitutional point in just a moment. Here is exactly how the process is laid out under this constitutional legislative line item veto: number one, after a bill becomes law, the President identifies an item of discretionary spending, direct spending or special interest tax break in legislation that is being signed into law. The President then submits a special message to Congress, no more than five, asking for the rescission of a spending item or items. After receiving this bill or messages, the House and the Senate have a total of 14 legislative days to bring it to the

floor for an up-or-down vote. If the House and Senate pass the President's rescission request, it is sent to the President and becomes law. If either House votes against it, the rescission is not enacted.

This is far different than the earlier legislative line item veto. This is not your father's line item veto. In fact, I agree with the Supreme Court ruling that said that the earlier line item veto was unconstitutional, because that line item veto, among other things, violated the separation of powers. This protects the prerogatives of the legislative branch, specifically, because this: the action is executed by Congress, not the administration. Under the old version the administration made the decision. Line item veto. That is the end of it. If Congress didn't like it, they would have to come up with a two- thirds vote to override that. That is not how this situation works.

Under this system, the President, who already has similar existing rescission authority, sends a rescission request to the Congress, just like he can do today. Only under this situation, we simply add a fast track authority, like we do with a lot of other legislation, like trade legislation, whereby we can't duck the vote by within 14 legislative days the House and the Senate vote on this, up or down. We decide in Congress. We vote to affirm the rescission. If we choose not to pass the rescission, the rescission does not take place. The money is spent. This is constitutional to the point where the gentleman who argued against the line item veto successfully in the Supreme Court in 1998 came to testify in three different committee hearings, Charles Cooper, as to the constitutionality of this, that this does, in fact, protect the prerogatives of the legislative branch; that this is consistent with the bicameralism and presentment clause in the Constitution, and maintains the separation of powers.

Now, we have worked with a lot of parties. We have worked with Democrats, constitutional experts, Republicans, OMB. In fact, this bill has been so bipartisan in the past, similar legislation has been proposed. In 1993, H.R. 1578 received 250 votes, including 174 Democrats. In 1994, H.R. 4600 received 342 votes, an expedited rescission bill, 173 Democrats. Two years ago, Congressman Charles Stenholm and I, a Blue Dog Democrat, brought it to the floor. We got 174 votes for virtually the same legislation, where we got 45 Democrats.

Now, the gentleman from South Carolina, the ranking member, has brought a lot of good points to the table. He is a gentleman who has watched this process for many years and understands this process very, very well. In particular, he brought six items of concern to the committee 3 weeks ago, which I took very, very copious notes of, which I took to heart. And because of that, we have made six big changes to this bill to try and improve this legislation, because I think the gentleman from South Carolina made excellent suggestions.

We limited time on the President's submission of a rescission request. We limited the number of requests. We wrote a ban on duplicative requests so the President couldn't send a request over and over and over and tie us into knots. We shortened the deferral period to the minimum amount necessary. We clarified that existing entitlements are exempt. Not Medicare, not Social Security, not other entitlements. We put a sunset in here so that we can revisit this law in 6 years to make sure that the balance of power is maintained.

Why is this needed, Mr. Speaker?

I think the success of this tool will be judged more in how much wasteful spending doesn't get put into bills and less on how much wasteful spending we take out of bills. Having this deterrence, having this extra layer of accountability will bring the level of sunshine, transparency and accountability to the spending and taxing process in Congress exactly where it is needed the most.

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

Mr. Speaker, I yield 2 minutes to the distinguished majority whip, Mr. Blunt.

Mr. Speaker, I yield 1\1/2\ minutes to the distinguished gentleman from Georgia (Mr. Kingston).

Mr. Speaker, at this time I yield 1\1/2\ minutes to the gentleman from Utah (Mr. Matheson).

Mr. Speaker, I think the gentleman from Minnesota will be happy to know that under the way this bill works, you cannot go after mandatory programs in the farm bill that already exist. So you cannot go back and take a commodity program out.

Mr. Speaker, I yield 2 minutes to the distinguished Member from Florida (Mr. Crenshaw), a member of the Budget Committee.

Mr. Speaker, given that my friend from Wisconsin voted for virtually the same bill 2 years ago when Charlie Stenholm and I had it on the floor, I hope we can count on his support again.

Mr. Speaker, at this time I yield 1\1/2\ minutes to the gentleman from Texas (Mr. Cuellar).

Mr. Speaker, I yield myself 20 seconds to answer what the gentleman mentioned on tax cuts.

The reason we go after tax rifle shots is we do not want to give the President the power of setting policy that Congress has. We are going after pork, tax pork, spending pork, not tax policy. That would be to abrogate our responsibility of setting policy to the executive branch, and we do not want to do that. That is why the bill was written as it is today.

Mr. Speaker, I yield 1\1/2\ minutes to the distinguished gentleman from Delaware (Mr. Castle).

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, at this time I would like to respond to something that the gentleman from South Carolina said. He said under this bill we could go after mandatory programs like Social Security, Medicare, veterans benefits.

Let me be very clear: you cannot with this program go after Social Security, Medicare and veterans benefits as we know it today. We are saying new programs. Why do we say it that way? Why new direct spending programs?

There are 5,000-plus earmarks in the transportation bill just this last year. Why should that be taken off the table? If you did that, then the Bridge to Nowhere would be exempt from the line item veto. I think most people who know this stuff think the Bridge to Nowhere ought to be one of the things that the President would want to go after under the line item veto.

We are talking about new programs, not the existing entitlement programs that we have come to know and enjoy for many of our constituents.

Mr. Speaker, I yield 1\1/2\ minutes to the distinguished gentleman from Colorado (Mr. Udall).

(Mr. UDALL of Colorado asked and was given permission to revise and extend his remarks.)

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, before I yield to the gentleman from Texas, I would simply like to point out I think the gentleman from Maryland said we need to cut more spending. I agree. That is why we should pass this. In fact, the gentleman from Maryland voted for similar legislation that I offered with Charlie Stenholm 2 years ago and two expedited rescission bills that the gentleman from South Carolina authored in the past. So I hope we can enjoy your support this time around.

Mr. Speaker, I yield 3 minutes to the distinguished gentleman from Texas (Mr. Hensarling).

At this time, Mr. Speaker, I would like to

yield 2 minutes to the gentleman from the Appropriations Committee from Illinois (Mr. Kirk).

Mr. Speaker, at this time I would like to yield 2 minutes to the gentleman from Texas (Mr. Conaway).

Mr. Speaker, may I inquire as to how much time I have remaining?

Mr. Speaker, I want to address a few of the concerns that have been mentioned by the other side of the aisle.

First of all, this is a bipartisan bill. If you paid attention, a number of the speakers came to the floor from the other side of the well to speak in favor of this. Actually, three Democrats came to the floor in favor of this bill that we are considering right now, three Democrats I am proud to call friends and supporters and coauthors of this proposal. In fact, we took an amendment of Mr. Cuellar of Texas to improve this bill.

Other speakers have said this gives too much power to the President. Well, let us just remember one thing: the President already has rescission authority today. Today, the President can rescind something, defer spending, and send it to Congress. Here is the problem: Congress just ignores these things. In fact, President Reagan sent $25 billion of rescissions to Congress, and they ignored every one of them.

So we want to make that process work. We are taking the existing authority he has, making it actually shorter in time frame, and we are simply guaranteeing that we are going to vote on it.

I think, if somebody sticks a wasteful pork barrel project like a $50 million rainforest museum from Iowa, a bridge to nowhere, or something like that in a bill in a conference report where we as Members of Congress have one choice, vote ``yes'' or ``no'' on the entire bill, then the President has a similar choice: sign or veto the entire bill.

That is wrong. We ought to be able to vote on that $50 million rainforest museum. This gives us the chance to do that, and this means that we can't duck those votes.

This is a bipartisan bill. It has been so bipartisan in the past that Mr. Spratt has offered very similar legislation. We got 173 Democrats on one of them, 174 on another. Mr. Stenholm and I offered a bill very similar to this 2 years ago; we got 45 Democrats on it. I hope that we will continue to get this bipartisan support that we had been getting.

But more importantly, Mr. Speaker, the American people know we need every tool we can get our hands on to go after wasteful spending. That is why taxpayer watchdog groups are key on voting this bill. The American Conservative Union, the Americans for Prosperity, Americans for Tax Reform, Citizens Against Government Waste, the Club For Growth, Freedom Works, National Federation of Independent Businesses, National Taxpayer Union, Taxpayers for Common Sense, the U.S. Chamber of Commerce all are key voting this vote as a key vote for the taxpayer. Other groups supporting this: ALEC, the American Taxpayer Alliance, Bond Market Association, Business Roundtable, Center for Individual Freedom, Concord Coalition, Association of Wholesale Distributors, National Restaurant Association, 60 Plus, Traditional Values. The list goes on and on.

Mr. Speaker, the American people know we need this tool to go after wasteful spending, taxpayers need this tool so we can do this, and, more importantly, we need more transparency in our process here in Congress.

We passed earmark reform so that Members of Congress have to defend their earmarks when they come to the floor of the House when we write these bills in the beginning. But a lot of this stuff gets inserted at the end of the process in the conference reports; that is why we need to have this deterrent.

I think the success of this bill will be less in how much pork we get out of legislation that we line item veto out, and more in how much pork never gets put into legislation in the first place, because there will be an extra deterrent. A Member of Congress who wants to slip in some big piece of pork barrel spending that he probably couldn't otherwise justify will think twice, because he or she may have to come to the well of the House and the well of the other body to defend that pork barrel spending.

This is good government. This is transparency. This is an added layer of accountability that is right for the taxpayer, and it is constitutional. It protects the prerogatives of the legislative branch. That is why I think this is a good bill. That is why I am pleased to call this a bipartisan bill. That is why I think we should strike this vote for the taxpayer.

With that, Mr. Speaker, I urge a ``aye'' vote for this.

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

Mr. Speaker, I reluctantly raise a point of order to the motion to recommit on the grounds that the motion includes provisions that are not germane to the bill. On those grounds, that is why I raise the point of order.

Mr. Speaker, I will just rise to say that that is evidence of my point of order which PAYGO is outside of the germaneness of this bill. Earmark reform is outside the germaneness of the bill. It is on those grounds that I raise this point of order.

Mr. Speaker, I rise in opposition to the motion to recommit.

Mr. Speaker, I want to commend the gentleman for a very substantive motion to recommit. I would like to go through a number of the provisions he raises and some of the concerns I have with them and why I have to rise in opposition.

Number one, Mr. Speaker, he excludes direct spending from the line item veto. A case in point. When we do the transportation reauthorization bill, that thing contains something like 5,000 earmarks. The bridge to nowhere is one of the most prolific examples of such things. I do not think those things should be exempt from this line item veto tool.

Number two, he reduces the number of messages from five to one. My fear with this change is that it will reduce the effectiveness of this tool. If the President only has one bite at the apple, only one bill he can send, he will only go after one or two earmarks. What if a bill has 5,000 earmarks? What if a bill has 500 earmarks? The President ought to be able to send us more votes so we can go after more earmarks and cut out more wasteful spending. If he only gets to send 1 bill, and he puts 50 pieces in that bill, then the President will be growing his vote coalition against it. Fifty State delegations also vote against it. So I think if you just do one bill, you are going to make this tool very, very small. It will not be nearly as effective because the President will be disincentivized from putting many earmarks in it because they will fall under their own weight. That is why we put five bills so we can go after a great number of earmarks so that we can get maximum output for this.

Now, the other thing, it permits amendments to strike. I understand the intent of this. I think it is valuable, but the problem I have with permitting amendments to strike is that then you are going to ping-pong back and forth with the House and Senate. You will see no end to this.

The reason why we do not allow amendments to conference reports is because conference reports represent a conclusion of a legislative process, the end of a legislative process before a bill becomes law. But that is where a lot of mischief happens, and mischief occurs because people insert earmarks in conference reports. I think by doing this you are going to encourage that. Even if you try to come up with language to streamline the conference report process, I still think this produces those problems.

Lastly, Mr. Speaker, the tax provision. This is one that is worthy of very good debate. Mr. Spratt wants to limit the number of tax beneficiaries from 100 to 10. Let me give you an example. We chose to do it the way we did it so we would go after tax pork, rifleshot tax policy, you know, this tax cut for this person, this tax entity, instead of tax policy. Let me just give you one example. The orphan drug tax credit.

We have the orphan drug tax credit in tax law today because there are a lot of small diseases that do not have a lot of constituencies, that do not have a lot of people--lupus, Duchenne's disease, and you are not going to see pharmaceutical companies engaging in committing millions of dollars in research to cure such small diseases, but we want cures for these smaller diseases, these rare diseases. So we created the orphan drug tax credit. How many people utilize this orphan drug tax credit? Very few, surely not 100, maybe 3, 4 companies. Researchers will research a cure for a rare disease, but if they do the research, they qualify for the tax credit. That is tax policy. Fewer than 100 beneficiaries get it, but we wanted to have a tax incentive so that researchers will commit their dollars to researching and finding cures for rare diseases. That is just one example of how broadening the scope of this goes into tax policy.

The goal of this is not to give the President the power to rewrite policy, to rewrite entitlement policy, to rewrite tax policy. The goal of the legislative line item vote is to give us the tool to go after pork, tax pork.

Now, what we want to accomplish with this, Mr. Speaker, is to give us the tools to go after wasteful spending, wasteful direct spending, wasteful discretionary spending, and wasteful tax pork. The key thing is that we reserve the power. The Executive can give us the bill; the Executive, the President, can pull the pork out; but who makes the decision is Congress. Congress and Congress alone, the legislative branch, are the ones who execute the action.

I think the compromise we have come up with, the base bill, is the right way to go.

And the last point I will make is the gentleman reduces the deferral period to 30 days. Here is the problem with that. That means Congress can pass a huge omnibus appropriations bill in October, as we often do, and then leave for recess until January 20, when the President has the State of the Union address. He is out of session for 3 months and Congress cannot waive the deferral period.

I urge a ``no'' vote on the motion to recommit.

Mr. Speaker, I demand a recorded vote.

Mr. Speaker, I thank the gentleman for yielding.

Mr. Speaker, I just recently read a lecture from the most highly respected scholar on Middle East affairs and Islam in America, Bernard Lewis. He went through Osama bin Laden's original fatwa. He went through a lot of writings of al Qaeda back in the early to mid-1990s, and what they declared is very chilling. They declared that their war was going to be against the two superpowers at the time: the Soviet Union and America. They believed they defeated the USSR in Afghanistan. I would like to think peace through strength is what beat it here and the fact that communism did not work. But they think they beat it.

Now they think they have one last enemy to beat before they can reach their caliphate from Spain to Indonesia: America.

Mr. Speaker, the war on terror did not begin on 9/11. It began on 2/ 26. February 26, 1993, when they first hit us at the World Trade Center. Then in 1996, the Khobar Towers. Then in 1998 at our two embassies in Africa. Then in 2000, the USS Cole. Then in 2001, 9/11.

Mr. Speaker, we are at war. They have declared this war against us long ago. The sooner we realize it, the better we are. The best way to win this war is to play away games and not home games.

The good news on this front is we have not had another 9/11 since 9/ 11. We have not had a major terrorist attack here in America.

If Iraq becomes democratic, if Iraq becomes free, they lose. They cannot win and manifest their distorted belief. They want to have a world like what we saw on display in Afghanistan, the Taliban, throughout the entire Middle East. If democracy and freedom can persist, if it can take root, if it can succeed, as it is succeeding in many parts of the Arab world, the terrorists lose.

And the most important thing in all of this that all of us should have in the front of our minds is will our children grow up in America with the fear of terrorism in the front of their mind or will it be a distant memory in history? I grew up in Jamesville, Wisconsin, as a happy kid. I want my kids to grow up in Jamesville, Wisconsin, with the same kind of happiness, not with the fear of terrorism.

This is a global war, a war we have to win, a war that only America through its leadership can win for the rest of the world. The sooner we wake up to that, the better off we are and the more peaceful life we can leave to our children.

That is why our troops overseas are doing a great job. That is why we have to see this thing through. The terrorists think we are weak because of our freedoms. They think that we do not have the stomach. They think they can turn our public opinion. That is not true.

Let's prove that that is not true, and let's win this war on terror.

Mr. Speaker, today, I take to the floor to reluctantly cast my vote against H.R. 5449. Although I deeply admire the hard work performed by our Nation's air traffic controllers and support their efforts to negotiate a fair contract, I cannot support this legislation. I believe that this bill goes too far and needlessly picks a winner and a loser between the Federal Aviation Administration (FAA) and the National Association of Air Traffic Controllers, NATCA. In addition, this bill will completely remove congressional oversight from this process.

No workers, regardless of their profession, should be forced to accept a contract without having a chance to negotiate the terms. I believe the existing negotiating framework between the FAA and the air traffic controllers is broken and needs to be fixed. That is why I not only cosponsored H.R. 4755, the Federal Aviation Administration Fair Labor Management Dispute Resolution Act, but sent a letter to the Speaker asking for a floor vote on this bill.

H.R. 4755 would have prevented the FAA from instituting one-sided, unilateral contract terms on the labor union. If negotiations were to stall, Congress would have 60 days to review the FAA's last proposal and then decide whether or not more negotiations were necessary. The bill would have prevented air traffic controllers from having to accept a contract they clearly rejected, while at the same time ensuring that negotiations did not remain deadlocked. I supported H.R. 4755 then and I support it now. Unfortunately, this is not the bill that has been brought to the floor today.

H.R. 5449 goes too far and needlessly puts Congress in the position of picking a winner and a loser in this debate. While I agree that the current process is flawed, the role of Congress is to reform the system, not to circumvent it. This bill would further hinder negotiations, prevent real progress from being made, and remove Congress from the process. For these reasons, I cannot support this bill.

Mr. Chairman, I rise today to support the Milk Income Loss Contract Program (MILC). Created under the 2002 Farm Bill, the MILC program has been a major success for Wisconsin dairy farmers. I believe it is inherently unfair to set the expiration date of the MILC program one month before the expiration of other farm bill programs. MILC should be on a level playing field with all other commodity programs, so that it will be dealt with equitably under the 2007 Farm Bill.

Mr. Chairman, I thank the gentleman for yielding. I also want to thank Mr. Hensarling for his leadership on budget reform. It is a pleasure to be a coauthor of the Family Budget Protection Act with him.

Mr. Chairman, budgets are about values. Budgets are about priorities, governing philosophies. What this Republican Study Committee budget does, what this Contract with America budget, renewed, does is express our values that the nucleus of the American economy and the American society is the individual. It is the families. It is not the government.

What this budget recognizes is that it is entirely possible not to cut the deficit in half in 5 years. It is entirely pragmatic and possible to eliminate the deficit in 5 years. What we are simply proposing to do is what Congress tried to do and did in 1995. It is not a ridiculous proposition that we can restrain the growth in government to eliminate the deficit in 5 years. We can keep taxes low, and we can restrain the growth of government to do this and reform the entitlements that are in desperate need of reform.

I compliment the gentleman on this budget. I urge its adoption.

Mr. Chairman, I claim the time in opposition.

Mr. Chairman, I yield 2 minutes to the gentleman from Texas (Mr. Hensarling), an esteemed member of the Budget Committee.

Mr. Chairman, I yield myself as much time as I may consume.

Mr. Chairman, I would like to analyze this budget in several different ways. First of all, I want to compliment the Member from South Carolina for bringing the substitute to the floor. That is an important first step, because without competing ideas and competing budgets, we cannot really have a good debate here.

But what is this substitute we are dealing with right here? Number one, if you take a look at this substitute, it has enormous tax increases in it, and that is okay. It just defines the difference between the two parties and the two philosophies that we have.

Why does it have what I just said? Well, this budget claims to want to extend the extension of the child tax credit, extend the marriage penalty relief, 10 percent individual tax bracket, alternative minimum tax rate, estate tax relief, research and development tax credit, extension for the deduction of State and local sales taxes, marriage penalty, all of the kinds of things that we passed in the 2003 tax cuts that we all think are good ideas.

But the question, Mr. Chairman, is do they pay for it? No, they do not. They claim in their budget they have $150 billion set aside for this. Well, if you add up the costs, if you add up what it would take to continue this tax relief, that is $922 billion.

So they put in $150 billion in the budget for this tax policy, when it costs $922 billion. Where do they make up the difference? How do they come up with this $772 billion difference?

Well, that is the little asterisk that they have on their budget. That is the little footnote that they have on their budget. That is the tax gap. What they propose to do is simply this: If we just give the IRS some more money, if we hire more IRS agents, audit more Americans, and crack down harder on enforcement of the Tax Code, we will get this $772 billion.

So just trust us, the budget adds up. We know we are only setting aside $150 billion for the $922 billion of tax cuts we would like to pay for in this budget. So to make up the difference, we are just going to send the IRS after more people, and that is how we make up the additional $772 billion.

Now, the other question you want to ask is, well, are they being more frugal with the taxpayer dollars? Are they spending less money? Well, no this budget does not do this either. This budget spends more money than the majority budget, than the proposed budget. This budget spends $139 billion more.

Well, where do they spend that money? We have heard a lot of talk here on the floor about the need to support our troops. We need to support our soldiers. We need to invest in science and basic research. We need more

mathematicians, more scientists to compete in the global economy and globalization.

Those are not extra funding in this budget. What about our veterans? Our veterans are returning from our wars, from Iraq and Afghanistan, coming back from other tours of duty. We need to work on our veterans. They do not propose any additional veterans spending over the base budget in here. They have $139 billion of more spending in other areas.

So they are not proposing more money for veterans, for science, for defense, which we believe are the top priorities. They are basically sticking with our numbers.

Mr. Chairman, I think what you have here is the same old same old: more spending, higher taxes, and a budget that just does not add up.

Mr. Chairman, I think the base budget that we are passing here today is a good budget. I prefer to do less on spending.

I was here speaking on the Contract with America renewed budget, the Study Committee budget, just a moment ago. But this budget honors our commitment to our troops, honors our commitment to our veterans, makes sure that we do think about the global economy and invest in basic research and science, and, more importantly, this budget budgets for that tax policy so our constituents, the American economy and the American taxpayer does not get stuck with higher taxes.

Gasoline is $3 a gallon. The cost of living is high in America because health insurance premiums are going up double digits a year. The last thing the American taxpayer needs is a tax increase. Yet if this budget were to pass, something tells me that these IRS agents, as smart as they are, as aggressive as they are, as good at doing audits as they may be, these IRS agents are not going to go out and get another $772 billion to make up and fill this hole to prevent those big tax increases from hitting the American people, from hitting the American economy.

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

Mr. Chairman, I yield 2\1/2\ minutes to the chairman of the House Budget Committee, Mr. Nussle.

Mr. Chairman, I yield 3 minutes to the gentleman from Florida (Mr. Crenshaw).

Mr. Chairman, I yield 2 minutes to the gentleman from New Hampshire (Mr. Bradley).

Mr. Chairman, I yield 2 minutes to the gentleman from Michigan (Mr. McCotter).

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, on unpatriotic, irresponsible, immoral, wow, those are big words. First, a couple of facts. Veterans spending, defense spending, homeland security spending, they are increased in the budget. They are not cut. They are not savagely cut. Increased.

Let us talk about the differences between the Spratt Democrat substitute and the majority budget that is on the floor here today.

Number one, we believe it is important that we reform government. Just because we take our taxpayer dollars and spend them on government programs does not mean we cannot always look at reforming government. That is why this budget proposes reconciliation, going and looking and trying to find savings on the 60 percent of the Federal budget that is entitlement. They do not even touch that part of the budget. We are saying let us do it every year. That is important reform, number one.

Number two, we are trying to bring some common sense to the emergency spending process. Far too long in Congress, Congress has been able to declare virtually anything an emergency. Not anymore. We are saying if we are going to do emergency spending, it has to fit a tight definition of what truly is an emergency, an act of terrorism, a natural disaster, an act of war, things like that.

And more importantly, Mr. Chairman, we are going to budget for those emergencies because we always know that there is going to be that hurricane, that tornado, or that flood. That is smart and prudent budgeting. That is what we do. The Democrat substitute doesn't do any of that.

But where is the real difference? The real difference is this: we believe that the money that is made in America is the individual's money. We believe that the fruit of the labor of people who are working hard and paying taxes is theirs. It is their money. That is different from the premise on the other side of the aisle.

Let me explain it. One of the great things we accomplished in the 2003 tax cuts were that we saw that the vast majority of income tax ratepayers, the top ratepayers, were small businesses; yet we were taxing them at 40 percent when we were taxing IBM, Microsoft, and Exxon at 35 percent. So we lowered that tax rate on small businesses, on entrepreneurs, on family businesses and on farmers so they are at least not paying more taxes than the largest corporations in America.

What did the Democrats decide to do? Raise those taxes. Let's make sure we raise taxes on family farmers, raise taxes on small businesses so that that small business in America, the job-creating engine of America, pays higher taxes than Exxon and Microsoft and IBM. That is wrong. I think that is immoral. I think that is irresponsible. Yet that is what they are proposing to do.

You know what they are saying to the rest of America? You know what they are saying to the families that are getting a per-child tax credit, people who are married and who aren't paying a marriage penalty any more, people who are trying to save to send their kids to school, people who are saving for their IRAs or their pensions or their 401(k)s? You know what they are saying? They are saying to those people, if you don't want a massive tax increase, if you don't want a huge tax increase, we have to make sure we go after deadbeat tax cheats. And if we can collect more money from tax cheats, then we won't raise your taxes.

But if the government can't collect money from tax cheats, if the IRS can't do a good enough job and go get an extra $772 billion, then we are going to raise your taxes. That is what their budget proposal is. And on top of that, they propose even more spending.

Reject tax increases, reject high spending, and, Mr. Chairman, let us hold the line on domestic spending. Let's fund our veterans, let's protect our troops, let's support the war on terror, and let's not raise taxes. Defeat the Spratt substitute and support the majority budget.

This is Pat Toomey, President of Club for Growth, a conservative advocacy group. He was one of the most conservative Members of Congress for many years here, I believe, all through the nineties.

Here is Pat Toomey in the Philadelphia Inquirer last Monday:

``Republicans have abandoned the principles of limited government and fiscal discipline that historically have united Republicans and energized the Republican base. Too many Republicans have gotten too comfortable in office.''

That is Pat Toomey. That is not Tim Ryan. That is not Kendrick Meek.

Mr. Toomey went on to say:

``There is a very high level of frustration and disappointment among rank-and-file Republicans when they see a Republican-controlled Congress engaging in an obscene level of wasteful spending.''

We see it day in and day out: $9 billion in Iraq, nobody knows where it is; $16.3 billion, corporate subsidies to the oil companies; $16.3 billion of public tax money that hardworking citizens sent down here, the Republican Congress took that money and gave $16.3 billion of it to the energy companies. Wasteful spending, corporate welfare, time and time and time and time again. The family budget would not allow for money just to be spent. You ask yourselves, where did it go?

Former House Speaker Newt Gingrich, another third-party validator, talking about the Republicans. This was at the end of March:

``They are seen by the country as being in charge of a government that can't function.''

That is not me. That is Newt Gingrich, the father who gave birth to the Republican revolution. When Newt Gingrich is saying this, when Pat Toomey is saying this, we have a real problem in our country.

What Democrats have tried to do, Mr. Speaker, time and time and time again is implement rules of the House that will constrain spending by saying, if you want to spend money, you either need to cut it from a program that we currently have or you need to raise the revenue somewhere, but it has got to be budget neutral. It is called PAYGO, pay-as-you-go. We have tried to do this.

Mr. Spratt, the ranking member on the Budget Committee, tried to offer an amendment, rollcall number 87, on March 17, 2005. Not one Republican voted for it. Again, this is rules that we can put in place here that won't allow you to spend more money than you have. Or if you are going to spend it, you have got to get it from somewhere. Democrats offered an amendment here. Mr. Spratt offered a substitute amendment again on March 25, 2004. Republicans shot it down. Charlie Stenholm when he was here tried to do it. Dennis Moore of Kansas tried to do it. Time and time and time again, Mr. Speaker, the Democrats want to put these fiscal restraints in place. So it doesn't matter if there is a Republican Congress or a Democratic Congress, the rules are in place. These rules were in place all throughout the nineties. That is why we had surplus money. That is why we made the targeted investments, focused in certain areas that yield results, that yield tax money.

Investments in education, you get a good return on that. We had a study done at the University of Akron, Mr. Speaker, a few years back, this was on State tax money in Ohio, but when the State spent $1 on tax money that went towards higher education, they got $2 back in taxes. Education is a great investment. Let's make this investment. Let's invest and do it in a way that we can get a good return on our money down the line. But today the Republican Congress has just been tied up in knots with the special interests, the oil companies, the energy companies, the health care industry. Time and time again they are given public tax dollars in the form of corporate welfare. Stop the corporate welfare. Stop the corporate welfare and let's move forward.

But I want to say that it is not me, Mr. Speaker. It is not me. It is Pat Toomey. It is Newt Gingrich. It is a lot of the conservatives, or some of the conservatives that are still left on the Republican side. All we want to do is get this country back together. Because where we are getting the money, because we are running deficits, how do you plug the hole? You got to go borrow it. The Republican Congress continues to borrow from the Chinese government, from the Japanese government, from OPEC countries.

This is really happening. This is one of the K Street fairy tales. This is like a K Street fairy tale. The Republican majority is borrowing money. As we run these deficits and they give millionaires tax cuts, $42,000 they are going to give them more next year. As they do that and we run these huge budget deficits, we can't fill the gap, so this Republican Congress and this Republican President, they are going to OPEC to borrow money from OPEC to help plug the hole. Can you imagine? It is like you are making it up. It is another K Street fairy tale that we have here. Running huge deficits. Gas is $3 a gallon. You not only give the oil companies $16.3 billion in corporate subsidies, but you also borrow money from OPEC countries to help plug the deficit because you are giving tax cuts to millionaires.

Now, I am not opposed to giving middle class people a tax cut. I am not opposed to giving a small business a tax cut. But I am against giving a millionaire $42,000 back when you are fighting two wars, your average people are struggling, tuition costs have doubled in the last 5 years, and you are giving Bill Gates another tax cut? That just doesn't make any sense. I don't care what your party affiliation is. That is irresponsible. That is irresponsible governing. And until we get the Republican Congress out and the Democratic Congress in, we are not going to be able to fix this thing, because we have tried. Mr. Spratt has tried. Mr. Sabo has tried. We have all tried.

But, Mr. Meek, as you know, we are having a very difficult time doing it.

Mr. Speaker, I yield my time to the gentleman from North Carolina (Mr. Hayes).

Madam Speaker, I rise in opposition to the motion to instruct. May I inquire as to how much time is left?

Madam Speaker, I yield myself such time as I may consume.

I appreciate a lot of what the two gentlemen have said, the gentleman from Georgia and the gentleman from Tennessee. A lot of it I agree with. And the Blue Dogs traditionally here in Congress have been joining with a lot of us fiscal conservatives on this side of the aisle to work for some of these budget reforms, and I hope in the future, in this session, that we could see a merger on budget process reforms to improve the quality of our budgets that we have here.

Tonight, we are talking about this motion to instruct. This motion to instruct I think is misguided in a few ways. Number one, I think it is hitting the wrong target. If the problem is with the budget that we pass and the results of those budgets, then the target ought to be the budget resolution. The budget resolution has already passed.

I think it is very noteworthy to point out the fact that last year's budget resolution, and we are negotiating this year's now, but last year's budget resolution, for the first time since modern budgeting, actually reduced domestic spending. It reduced nonsecurity discretionary spending. So we actually passed one of the most frugal budgets ever passed since we created the 1974 Budget Act here in Congress.

So we are on a path of being very frugal with the taxpayers' dollars. But what this motion to instruct is about is the tax bill. More importantly, this discusses cutting taxes. And the claim in this motion to instruct or the inference in this motion to instruct is that we shouldn't be cutting taxes; that we should take pressure off of cutting taxes. It is very important to point out that this tax bill really doesn't cut taxes, it simply stops taxes from being increased. It stops tax cuts from going away.

What we did in 2003, and it is important to remember, we came in to a recession in this country. We had the Enron scandal, the dot com bubble burst, the recession hit, 9/11. We got hit really hard as an American economy. The American people got hit hard. What is so wonderful about the story that has occurred since 2003 is the resiliency of the American people, the American entrepreneurs, the families, the farmers, the businesses, and of the American economy.

But there is one thing that happened in 2003 to get that going, to get our economy back on track, to get our budgets going in the right direction, and that was the tax cuts. Now, this chart shows where we were as an economy prior to the tax cuts that occurred in 2003.

Now, if you take a look at the left side of this chart, the average economic growth rate in America, the 10 quarters before, going back to 2001, the 10 quarters before the tax cuts was 1.3 percent. This is where the recession was. We had very anemic growth. We were losing hundreds of thousands of jobs in America every month during this recession.

So what did Congress do to respond to this? Congress did cut taxes and cut taxes across the board. We cut taxes on families, cut taxes on businesses, cut taxes on savings for seniors, cut taxes on capital formation which creates jobs, like capital gains and dividends and business expensing. But what happened after those tax cuts? Since the enactment of these tax cuts, the unemployment rate fell from 6.3 percent in June of 2003, the high, to 4.8 percent. Since the enactment of these tax cuts, we have gained nearly 5 million net new jobs in America. What this shows you is the average growth rate of our economy for the 10 quarters since the tax cuts has been 3.9 percent.

So take a look at what happened in America. We had the recession, the dot com bubble, the 9/11 terrorist attack, and we went into a recession and our economy was sputtering. We were growing at an average of 1.3 percent and losing hundreds of thousands of jobs. When we cut taxes on the American people, on the American economy, we had a huge rebound right away. Right away the economy kicked into gear, produced jobs and has grown at an average rate of 3.9 percent, faster than the national average for the history of our economy. Five million new jobs were created.

Now, one of the other things that occurred was during that time, because of the dot com bubble, because of the Enron scandal, the stock market really fell. And who really got hit by that were seniors and savers. There are so many seniors that I have talked with in my district, in the first Congressional District of Wisconsin, who literally saw their savings portfolio, in

that period of 2001 to 2003, cut in half; wiped away by 60 percent.

One of the things we were so worried about was the fact that senior citizens and their pension plans and their 401(k)'s and their IRAs had so much less value in their savings that they had much less to live on. So we went immediately to act, and what we did was we reduced tax rates on capital, tax rates on the things that stocks matter, which is capital gains and dividends.

What happened after that? Since the enactment of these 2003 tax cuts, the Dow Jones Industrial Average increased by 27 percent and now is back to where it was before the crash of the market. So we were able to build back that growth in savings for most of the seniors who rely on that, for the pension funds, for the 401(k)'s, so people could get their retirement savings back.

Those are some of the fundamental tax cuts that are in this tax bill. See, if we do nothing, taxes go up. If this motion to instruct would see its way through, taxes would go up. The effect of this motion to instruct is to say, do not prevent these tax increases. And if you do want to prevent these tax increases, you will have to raise taxes somewhere else to prevent these other tax increases. I think that is bad economic policy.

Now, where we need to improve is on spending. We need to bring the deficit down, and that is where the three of us are going to agree. That is where the gentleman from Georgia and the gentleman from Tennessee and I will clearly agree. Our deficit is too high. Our debt is far too high and we have to get it going in the other direction.

But, what has happened since 5 million net new jobs were created since 2003? What happened since the economy grew at such a faster rate? What actually happened was revenues increased. So when we cut tax rates, you would have thought that revenues would have gone down. In fact, the budget estimators here in Congress and in the administration said, we know that if you cut taxes, we think revenues will go down. Even though that may happen, it is important to get us out of the recession.

So back then we used this estimating measuring stick and our estimates predicted that revenues would go down if we cut taxes. We still cut taxes because we wanted to get people back to work. But what happened was the opposite occurred. Revenues went up. Revenues from capital gains taxes went up, even though the rate was lower. Revenues from marginal income tax rates went up, even though the rate was lower. Revenues from corporations surged by 47 percent last year alone, even at lower tax rates.

What happened was, just last year alone our tax revenues went up 15 percent. The year before they went up. So as a consequence of that, the budget deficit went down by 23 percent in 2004 and went down by 25 percent in 2005 from their projections. So the budget deficit projections actually went down because revenues went up, because people went back to work. They went from collecting unemployment to having a job and paying taxes.

That is good economic policy. It is good budget policy. And to reverse that by raising taxes would be bad economic policy but also bad budget policy. Where we need to focus is on the spending side of the ledger.

If you want to put it into perspective, the size of these tax cuts, and I want to rephrase that again, the tax cuts are simply preventing tax increases, the size of these tax cuts are $70 billion out of a 5- year budget that will spend $14 trillion. Next year's tax cuts, or to put it another way, to prevent tax increases from occurring next year amounts to $11 billion out of a budget that will spend $2.7 trillion.

Let me just read a list of some of the tax policies that would go away if this were to see its way through.

AMT relief for personal tax credits; State and local sales tax deduction. That is a huge issue in States like Tennessee and Texas and others. Research and development tax credit, a big job producer. Above- the-line deduction for higher education expenses; work opportunity tax credit; the welfare-to-work tax credit; savings accounts; enhanced 179 expensing for small businesses that allows small businesses to write off investments in their plant and equipment so they can create new jobs. Brownfield expensing to clean up environmental catastrophe areas; capital gains and dividends, the very tax cuts that have actually increased economic growth, produced jobs and increased tax revenues to the Federal Government.

So, at the end of the day, I think we are going to have a difference of philosophy when we talk about this. We may agree on the need to reduce spending. I hope we have agreement. But what we do not agree on this side of the aisle is the wrong thing to do to the American taxpayer today is to raise their taxes.

The problem here is not that Washington taxes too much; the problem here is that Washington spends too much. That is what we should focus on. The pressure should be on spending, not on raising taxes. I am sorry, but the effect of this motion to instruct would be to do just that.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield 1 minute to the gentleman from Georgia (Mr. Scott).

Madam Speaker, I yield myself such time as I may consume.

I hope the gentleman appreciates the fact that I yielded him a minute to beat me up some more.

I yield to the gentleman from Georgia.

Reclaiming my time, a couple of points.

Number one, as a percentage of this economy, this is not the largest deficit we have had in history, which is the statistic that matters. But you know what? This deficit is too big because it is a deficit, period.

Number two, if you do not pass this tax bill, taxes automatically go up. That means they are increased. Here is what this tax bill does: It prevents these tax cuts from going away. Said another way, it keeps taxes where they are so they do not automatically increase because the law requires that taxes go up next year, the year after, and the year after that.

So the concern we have is that because we lowered taxes, got economic growth going again, created new jobs, it actually increased revenues to the Federal Government and lowered our deficit projections. The concern we have is let us focus on spending, not taking more money out of the pocketbooks of our constituents. Let us not take a bigger bite of the paychecks of the workers of America by taking more of their tax dollars. Let us prevent these tax increases from hitting the American people and let us focus on the real problem, spending.

So if you try to defeat this tax bill, you are basically saying we want taxes to increase. Or if you want to offset it, you are saying to prevent tax increases we need to increase taxes. That does not make a lot of sense.

So the point is we have probably a fundamental disagreement. We believe that we should not raise taxes on people. We believe that the more money a person has in their paycheck, the more money a person has in their pocketbook and wallet and their business, the more successful they are going to be, the more freedom they have, the more prosperous they will be and the better our economy will be. And its impact on our budget deficits is a beneficial one, usually, because it means there are more revenues coming to the government.

Nevertheless, we should not look at it as an opportunity to spend. We should look at this good economic news we have right now, the fact that the economy is growing, people are going back to work and paying taxes, we should look at this as a moment to make sure we do not spend as much money so we can reduce the deficit and pay down our debt. That is what it is all about at the end of the day.

Madam Speaker, I appreciate the dialogue and the debate. I urge a no vote on this motion to instruct.

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

Mr. Chairman, after long deliberation and discussion with the bill's author, I decided to vote ``aye'' on H.R. 4437. This bill is far from complete, and far from being ready to become law. Yet, it has become clear that Congress will deal with immigration reform through several stages in a long process during the next session of the 109th Congress. I supported H.R. 4437 to begin this process, so we can ultimately achieve comprehensive immigration reform.

Among the provisions I believe are instrumental toward achieving such reform are the reforms to secure our borders. Border security is no longer simply an issue of illegal immigration. It is an issue of national security, where we are vulnerable to terrorist infiltration. This proposal offers a comprehensive way to address this threat.

However, I have several concerns with this legislation that must be addressed in order to receive my support for a final, comprehensive solution to fixing our broken immigration system.

First and foremost, the provision in H.R. 4437 that makes undocumented alien status a federal felony is totally unacceptable. Prior to the bill's passing, I received a commitment from the author, Chairman Sensenbrenner, that this provision will be removed. Second, the employer verification system proposed in this bill is unworkable and must be fixed. Third, a final bill should include the creation of a secure, legal channel by which foreign workers needed to keep the United States' economy growing may enter and leave the country. And, finally, we must bring into the open, in a reasonable and fair manner, the millions of immigrants who are living in our communities without any documentation. Failure to address all of these issues will simply prolong our broken immigration system.

Because Congress is so divided on how to achieve comprehensive reform, it has become clear to me that such reform will occur in stages over the course of the next year. I look forward to working with my colleagues in both political parties to make sure the final version of this legislative effort is one we can all be proud to support.

Mr. Speaker, let us talk about the fact that that same CBO report did say that child support payments will increase, yes, increase.

Mr. Speaker, what are we doing with child support payments? What we are simply saying is that we have a Federal Government match. What the Federal Government match is spending on child support with State governments is 50 percent for food stamps, for Medicaid, that is what we are proposing here.

When we passed welfare reform, we increased the match for child support to 66 percent. What happened: child support collections went way up; welfare case loads way down. Yet we still have a higher match than normal even though our case loads are way down. What we are simply trying to do is reform government to save money and still meet the needs of the people.

What about Medicare. This motion to instruct says let us gut the Medicare Advantage Program. What is the Medicare Advantage Program? Do you ever hear that line when you do a town hall meeting with senior citizens that say we on Medicare ought to get the same health care you in Congress get? That is the Medicare Advantage Program. We are simply saying to seniors, if you want to have comprehensive health insurance like we have in Congress, like other Federal employees have, you should get that.

What does this motion to instruct do? It compromises that entire program.

Mr. Speaker, what about all these issues? Food stamps, Medicaid, Medicare, child support, all of that spending is increasing in this bill. What does this budget do? This budget proposes to increase spending over 6.3 percent but not 6.4 percent, the current projection.

Let me say it another way. We are proposing to save $45 billion out of a $15 trillion budget over the next 5 years. We are proposing to increase spending 6.3 percent instead of 6.4 percent, and that sounds like a draconian cut.

I have also heard speakers say that we are proposing deep tax cuts. Mr. Speaker, here is their definition of deep tax cuts: we are not raising taxes. What we are proposing to do in this budget is to not raise taxes. We are proposing simply to keep taxes where we are today. When we had a recession 2 years ago, when the Dot-com bubble burst, people lost their savings when the market went down. We lost hundreds of thousands of jobs; we had 2 years of economic growth no higher than 1.3 percent, and we cut taxes.

What happened after we cut taxes, 4.5 million jobs were created. The stock market came back. Our stock market savings portfolios, our savings for seniors grew 23 percent. We are averaging 148,000 new jobs being created every month. We created 215,000 just last month alone. Our economy grew 4.3 percent last quarter alone. We raise taxes; we hurt jobs. It is a difference in philosophy.

The Democrats are saying raise taxes and do not do anything to control spending. We do not want to raise taxes; we want to control spending and balance the budget.

Mr. Speaker, will the gentleman yield?

Does the CBO report also not say that child support payments will go up from one year to the next?

The gentleman just answered my question, child support payments will go up.

Mr. Speaker, I thank the gentleman for yielding me this time.

Mr. Speaker, I cannot think of anything more scary, anything worse than working one's lifetime, working hard every day and then seeing their pension go before them, seeing their pension get terminated. That is the worst possible thing that could happen to a worker and to a family.

We have a system that needs fixing, Mr. Speaker. We have a pension system that has some loopholes where companies could not put money in their pension plan when they needed to, to make them funded, and then we have a system that disincentivizes companies from putting more money in their pension plan to prefund the workers and employees when they have one and they have the will to do so. That is wrong, and that needs to be fixed.

Yet, on the other hand, Mr. Speaker, as this legislation was being drafted, we want to make sure we get to a time where companies fully fund their workers' pensions. Getting to that transition was difficult, and I want to thank the chairman of the Ways and Means Committee, Mr. Thomas; the chairman of the Education and the Workforce Committee, Mr. Boehner, for working with us to address our concerns specifically on behalf of the auto sector. Because of this, the issues surrounding credit balances, plant shutdown benefits and those things that were raised by the auto sector, by the UAW, have been addressed in this legislation, are being addressed in this manager's amendment.

I opposed this bill in committee. I was the only Republican to do so. But, Mr. Speaker, we have fixed this legislation. This legislation is good for labor. This legislation is good for management. But, most importantly, this legislation is good to the employees and the workers of America.

I encourage and I ask for a yes vote on this bill because it is fixed. It is good, and it should pass.

Mr. Speaker, I appreciate the gentleman yielding me time.

I also appreciate the fact that the gentleman from Washington is willing to acknowledge Christmas here on the House floor. That is a nice step in the right direction.

Mr. Speaker, let us look at the facts. To hear the other side, you would think we were taking a chain saw to the budget. What we are proposing in the budget is that we increase entitlement spending 6.3 percent instead of 6.4 percent, saving $50 billion out of a $14 trillion budget, by rooting out waste, fraud and abuse by reforming government.

But let us talk about these tax cuts. You would think when we cut taxes in 2003 we would have lost revenues. Right? That is the intuitive thing to say. Wrong. That is not what happened. Since the enactment of the 2003 tax cuts, job losses went away. The unemployment rate was 6.1 percent when we cut taxes. The unemployment rate is 5 percent.

Since we cut taxes, we have averaged a job creation every month of 148,000 jobs. Just last month alone we added 215,000 jobs to the economy. What happened before we cut taxes? Before we cut taxes, the 2 years before the tax cut, our economy grew at an average of 1.1 percent. How fast is the economy growing since the tax cuts? 4.1 percent. How fast did the economy grow last quarter? 4.3 percent.

Now, Mr. Speaker, what has happened since we cut taxes is we have reversed the job loss, we have reversed the decline in jobs, and we have added 4.4 million jobs to the American economy since the 2003 tax cuts.

What happened to revenues? Revenues increased. Yes, that is right. At these lower tax rates, at these lower taxes, we increased revenues to the Federal Government. Last year revenues went up 14 percent. Just this year individual income tax receipts are up 14 percent. Corporate income tax receipts are up 47 percent.

What happened to the deficit, Mr. Speaker? The deficit projection in 2004 was $521 billion. What is the deficit now? The deficit projection now is $319 billion. We dropped the deficit 23 percent last year. We dropped the deficit 25 percent last year. The deficit is down because tax revenues are up.

Do not defeat this bill and raise taxes. Let's stop tax increases.

Each of these tax cuts expire between this year and the next 2 years. It depends on the tax cut you are talking about.

Not at all.

If the gentleman will allow me to respond to his question.

Why is it important that we continue the tax relief progress that would expire in 2008 on dividends and capital gains? Because those are job creators.

Mr. Speaker, I thank the chairman for yielding, and

for his hard work on this. Also I want to start off, Mr. Speaker, by thanking the Democrats on the committee for working so hard and diligently with us.

This is a bipartisan bill. This is a bipartisan trade agreement. We will see votes from a lot of Democrats and a lot of Republicans when this comes to a vote. Why is that? Mr. Speaker, I think this is a very important step in the right direction for our country. This is a very important precedent-making event. What we are accomplishing here is the first trade agreement in this region since the 9/11 Commission published their findings, since we launched the Middle East Free Trade Area Initiative, since 9/11.

Now, let us just say it is controversial what our country is doing in Iraq. I think it is safe to say that. That is a part of our war on terror, has controversy. Well, what are we trying to accomplish there? We believe that freedom and democracy are the best ultimate tools in the war on terrorism. We believe that our children and grandchildren will be more safe and secure here in America and around the world, if other people are free, if other people have the ability to determine their own destiny and their own futures.

What does this have to do with that? A trade agreement with the United States with these countries, with Bahrain, in particular, helps secure that future. By seeing the leadership of Bahrain, the first country in the Gulf to do this, gravitating and taking the leadership, for rule of law, transparency in its legislature, changing its government to a constitutional monarchy, having a directly representative parliament, giving women the right to vote, given women elected positions in government, giving woman elected positions in the ministry, in the cabinet level, having the rule of law, having transparency, all of those things are the necessary and key foundations and building blocks to freedom and democracy.

That is ultimately how we win against the war on terrorism. This is the way we do it on a bipartisan basis. This is the opportunity for Republicans and Democrats to go forward with one voice, one face, one message as Americans going overseas, going forward confidently to win the war on terror and help encourage the spread of freedom and democracy. That is why this is an important trade agreement.

Is Bahrain significant from an economic value? It is a small country relative to other economic trade partners. Is this trade agreement in and of itself a good deal for us? Absolutely. Zero tariffs on manufactured goods. Zero tariffs on our agricultural goods. Fair trade rules. This agreement improves labor standards.

The Bahrainees have already shown leadership in their region in this area. In 2000, they passed a very sweeping labor reform law. They have since committed to passing even more sweeping labor reform laws. So we are already seeing tremendous progress being made. This is a country, Mr. Speaker, that has really shown leadership in this region against the grain, against pressure from their neighbors across the causeway in Saudi Arabia and elsewhere in the Gulf.

This is a country that has been our friend and ally for over 100 years, that has hosted our 5th Fleet naval base from which we do all of our Naval operations in the Iraqi theatre, in the Afghani theatre, come from Bahrain, from our 5th Fleet.

This is a country that has stood with the United States through thick and then in helping us stop money laundering for terrorists, in helping us with our military, in standing with us for democracy in the Middle East. It is an important ally. It is an ally that has done a lot, that has shown leadership, that has risked a lot to stand with us for democracy and freedom, that is gravitating towards these kinds of reforms.

The vision that this trade agreement represents, Mr. Speaker, is a vision of spreading trade, free markets, capitalism and democracy and freedom throughout the greater Middle East. This is the road map to the future of the Middle East.

And that is why it is so important. This is a bipartisan movement. That is why I just want to say one more time how thankful I am to the ranking member of the Ways and Means Committee, the gentleman from New York (Mr. Rangel) for working very hard to meet this agreement, and the gentleman from Maryland (Mr. Cardin) as well, for working hard to meet this agreement so that we can stand here today as Republicans and Democrats in favor of this very important trade agreement.

Mr. Speaker, we have heard throughout this debate a lot of reference to the trade deficit. I think it is important to look at that. When you look at our Nation's trade deficit, we enjoy a very large surplus in services, and our trade deficit comes from a trade deficit in manufactured goods.

Mr. Speaker, according to the latest statistics, 94 percent of our trade deficit comes from countries we do not have a free trade agreement with. A free trade agreement like this agreement helps us get fair trade rule so we can trade honestly with each other; and, yes, get an advantage so we can create more jobs, send more exports, and have better paying jobs here at home. I will just repeat that statistic one more time: 94 percent of our manufactured good trade deficit comes from countries we do not have a trade agreement with.

But it is more than that. Trade combines people. What is important about this agreement is beyond the economic value which is very substantial. It is about the human value.

You see, Mr. Speaker, we have good relations between our governments. Our 5th Fleet is located in Bahrain. We have great relations between our diplomats and the Bahrainees, between our President and the emir.

What this agreement proposes to do is put American people in contact with Bahrainee people, put Americans in contact with Muslims, put Americans in contact with Arabs in the Gulf so we can better understand each other. Trade is about individuals combining to join in mutually beneficial behavior and activity and business arrangements, to help their families and help create jobs and grow their economies.

But more than that, trade will help our people better understand the people we do not understand as well. We need a better understanding of people in the Arab world. We need a better understanding of Muslims. This is important because of the climate we face in the world. That is why it is important that we pass this agreement so that the American people can join and bond in friendship with the Bahrainee people in the Gulf Coast in the Middle East so we can have a better understanding of each other. As we understand each other better, we can better secure peace and security for our children.