Floor Statements

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4840) to amend the Internal Revenue Code of 1986 to simplify the taxation of businesses.

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

Mr. Speaker, Americans are frustrated. They are frustrated with their current Tax Code, and they should be. The mountains of documents that they face are complicated, confusing, and sometimes contradictory. The effects of this complex code, by the way, are more than just frustration for those of us who are taxpayers. They include decreased levels of voluntary compliance, people cannot figure out the code and they are less likely to comply with it;

increased costs, of course, for the entire taxpayer system; reduced perception of fairness in the Federal tax system; and, of course, increased difficulties at the Internal Revenue Service as they try to administer this unwieldy code. Clearly, we need to make our Tax Code more user friendly, and we should take every opportunity to do so.

Over the last few years, we have done that in some cases, for instance, the expansion of the 10 percent tax bracket, and taking literally millions of taxpayers off the Internal Revenue Code altogether.

But today, Mr. Speaker, I would like to commend my colleague, the gentleman from Illinois (Mr. Crane), for legislation that he has brought to the floor showing his commitment to tax simplification, and particularly focusing on the needs of our small businesses.

H.R. 4840, which is before the House today, the Tax Simplification For America's Job Creators Act, provides provisions that will provide tax relief and simplification for small businesses and small business owners as they plan for the economy, which is now growing.

First, the bill will extend the $100,000 expensing amount provided under what is called section 179 of the Internal Revenue Code. This is an extremely important incentive which was included in the President's 2003 tax relief bill, the Jobs Growth and Tax Relief Reconciliation Act.

It allows small businesses to deduct up to $100,000 immediately, to write that off, not depreciate it over time, as compared to $25,000, which was in law before the 2003 tax relief act. This is for new equipment up to 2006. Therefore, we want to expand that, we want to extend the legislation into 2006 and 2007, and the legislation offered by the gentleman from Illinois (Mr. Crane) does that.

It also expands the definition of who qualifies. Before 2003, those companies who qualified were those that had $200,000 or less of capital purchases per year. We doubled that to $400,000 of capital purchases per year, making this provision something that is more usable for more small businesses.

Expensing, of course, allows small businesses to recover the cost of their investment immediately rather than writing it off over time and rather than requiring them to keep extensive records and track those deductions over several years. This helps reduce the cost of capital, which helps to expand plant and equipment. It also makes it simpler and less costly, less complicated for our small businesses to be able to comply with our Tax Code.

Again, today's bill will provide yet another vehicle that we can use to try to enact this important small business priority that has already passed the House in some other forms, and I commend the gentleman from Illinois (Chairman Crane) for it.

Second, his bill also begins adjusting an important standard which affects small businesses' ability to use the cash accounting system. The cash accounting method is simpler, and it provides under this legislation to convert from the current $5 million threshold to $10 million. So we are expanding the amount that can be indexed for inflation, so that more and more small businesses are not forced into using the accrual method each year.

It is important to understand that forcing businesses into the accrual accounting method has real consequences for smaller companies. Not only must they begin calculating taxes using a different accounting method; they must actually pay tax on the difference in income as measured by the accrual and the cash methods. The bill before us rectifies this situation by indexing the limit so inflation will not force more and more small businesses into the accrual method.

This does not change the $5 million threshold. Mr. Speaker, I correct myself. Rather, it indexes that going forward to inflation to be able to increase that amount. This change will provide $120 million in tax relief to smaller businesses during the coming decade.

Finally, the bill eliminates a number of outdated references in the code. These are so-called ``deadwood provisions.'' This is also very important both because these deadwood provisions that have been identified by the Joint Tax Committee, by the Treasury Department, by others in their reports are important to get out of the code because they do not need to be in it, do not make any sense; but it also creates confusion at the IRS and confusion among taxpayers and has created downstream problems that are difficult to address.

H.R. 4840, in the end, Mr. Speaker, will cut taxes by approximately $1.2 billion for our small businesses, and that figure is over the next decade.

The bill is well within our House-passed budget, and I believe it is very worthy of our support as an important simplification method. I urge my colleagues to support this legislation to help our small businesses, our job creators, our risk takers, who are out there ensuring that this economic recovery continues, and continues strongly.

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

Mr. Speaker, I appreciate the comments of my colleague from Texas. I agree with them.

Mr. Speaker, I yield such time as he may consume to the gentleman from Illinois (Mr. Crane), the author of this legislation on tax simplification.

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

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

I appreciate my friend from Washington's discussion on general tax relief. I suppose at the end he would say he supports this legislation before us because it is not a flat tax, it is not a sales tax, it is not even a fundamental reform. Rather, it is simplification and good, common-sense simplification at that, this one focused on small businesses. The next piece of legislation we will take up focuses more on individuals.

But it is hard to defend the current code. Again, my friend from Texas talked earlier about the compliance costs and referenced Professor Joel Slemrod's reports from the University of Michigan. I think the number is somewhere between 50 and 100 billion now. That is the consensus number; 85 seems to be the one most people are using. Mr. Speaker, $85 billion a year in compliance costs, and over 3 billion compliance hours.

Another interesting statistic is that every year now, tax compliance accounts for about 80 percent of the paperwork burden of the Federal Government. So we do need to do something.

Today is not the silver bullet, but it is a start. It is going into the current code and changing some unfair aspects of the code; in the case of section 179, helping businesses to be able to not just write off their purchases more quickly for equipment, but also to be able to reduce their compliance costs, because they do not have to keep those depreciation schedules over time.

It also takes out some deadwood provisions which come from the Joint Committee on Taxation recommendations, as well as Treasury Department recommendations, which say that these provisions of the code that have not been removed over time, and it must be done by statute by the way, not only cause confusion and complexity, but actually cause some taxpayers to make mistakes that then cause tremendous cost to the tax system over time.

This legislation also again helps some smaller businesses to be able to take advantage of cash accounting rather than the accrual method, which is a complexity. Therefore, this is a simplification as well.

So I appreciate the gentleman's comments, and what I would say is what we are doing today is, we are taking a very responsible step towards simplification. We are not providing again for the silver bullet. We need to continue to work on that, as we will every year, and I know as we are going forward in this Congress, should we be here on this congressional floor next year talking about these issues, hopefully we will have a more fundamental reform that we can agree on on a bipartisan basis, as we will agree today, I believe, on a bipartisan basis, on these simplifications.

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

Mr. Speaker, I appreciate the gentleman yielding.

I certainly never heard anybody say that section 179 expensing was temporary. What we said was that the bonus depreciation provision was temporary. Section 179, on our side, we have always intended to be permanent and we would certainly hope that it will be made permanent.

What we are doing today is, we are extending it for 2 more years, in 2006 and 2007, that is as compared to bonus depreciation, which was meant as a stimulus, just to correct the gentleman on those two depreciation provisions.

Mr. Speaker, I yield myself such time as I may consume just to respond to my friend from Washington.

For him to say, this does not matter and does not help anybody, I hope he will talk to the small business people in the State of Washington as well as in the State of Ohio that I represent. This does help them.

I was with one of those small business people today talking about section 179 expensing and the importance of being able to plan. And he was absolutely delighted that this Congress is going to pass, once again, legislation to be sure that he can plan for being able to immediately write off not $25,000 a year, but $100,000 a year of new purchases in equipment. This is extremely important.

If the gentleman chooses to vote ``no,'' that is his right, but for him to say it does not affect anybody, I think is inaccurate. That is not to mention the other provisions the gentleman from Illinois (Mr. Crane) talked about, which are also important to small businesses.

To say that this is a bill that does not matter and that it is just something that we do around election time, I think, is not consistent with the fact that in 2003, this same legislation was passed by this Congress. We could not do it for as long a period of time as we wanted to, frankly, because of our friends on the other side of the aisle who did not believe that this legislation should be made permanent.

We would like to make it permanent. It is extremely important to our small business community. It is extremely important to the risk-takers, to the entrepreneurs, who, after all, are creating most of the jobs out there right now. And I would hope that on a bipartisan basis we could at least agree to these simplifications.

We can have the debate later as to whether the gentleman would like to defend the current code and continue to have, again, 3 billion hours a year in compliance costs, $85 billion a year in expenses related to compliance; or whether we do want to look at more fundamental reforms. That would be more controversial and they will need, again, the same kind of bipartisan work that has gone into this legislation here.

But at a minimum, let us at least go into the current code and make some responsible changes to make it simpler for small businesses, which is this legislation before us.

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

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

I would remind my colleague from Illinois that some of the very issues that he raises are currently under consideration by the Congress, including the definition of a child. As he may know, I have introduced legislation to consolidate those definitions into one definition that is currently in the child tax credit conference between the House and the Senate. I fully expect he will have the opportunity to vote on that legislation in this Republican-controlled Chamber, if not this week, then in September; and that will be a major simplification.

I would also remind the gentleman that this complication of the Tax Code, which I agree with him on, is not just the province of one administration. I can remember when he was in the Clinton administration working on the Hope credit, working on the Lifetime Learning credit, working on many other ways to use the Tax Code to achieve social purposes which further complicated the code dramatically; and I would remind him that one of the pillars of the Bush administration tax relief was not just lowering rates for everybody, which is a simplification, not just lowering rates on capital gains which is a simplification, lowering rates on dividend which is a simplification, but also extending this 10 percent tax bracket.

That has focused exactly on the taxpayers that my colleagues are talking about. Lower-income taxpayers they say have got no benefit. Their benefit is total simplification, because 3 or 4 million Americans who are lower-income Americans now are no longer on the tax roles at all. They do not have to look over their shoulder at the IRS because they are off the Federal tax rolls. They pay no income tax at all, and that is simplification that George Bush put through this House and that most of us voted for on this side of the aisle.

With regard to EITC, I would remind my friend that we have actually, in the 2001 bill, streamlined the EITC, not as much as I would like, as we know, because we have talked about that; but their income tax credit has actually in this administration under this Congress been simplified.

So just to put a little bit of clarity around it and some perspective, today we are talking about section 179. We are talking about the expensing, the need to simplify that. I would remind him that the bonus depreciation provision that his colleague from Washington talked about as being temporary, that was also a simplification and simplification not just for small businesses but for all businesses.

So we have done our part in terms of making the code more complicated, both parties over the years; but if he looks back at the record over this Congress and over this administration, there are a number of items which have been very positive in terms of simplification, the most important of which is to take people off the rolls altogether, not having to worry about income taxes and the legislation before us today, again, bringing us back to where we are, taking us from the abstract to the practical.

We have an opportunity on a bipartisan basis to make some sensible changes to our Tax Code, to make it simpler for small businesses to comply with taxes. These are the risks takers. These are the people we want to help, and I commend my colleague from Illinois for bringing this legislation to the floor today.

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

Mr. Speaker, I think this has been a helpful debate to talk about the need for simplification. I am glad to see some of my colleagues on the other side of the aisle are agreeing with us with regard to this underlying legislation with regard to small businesses but also with the need to simplify our code. We have taken steps to simplify, and we need to continue to do that.

It is on the heels of major tax relief in 2001, 2002, and 2003 this administration inherited a failing economy, moving into recession. Then the tragedy of 9/11, the shock of the corporate scandals, the stock market boom busting, a lot of challenges to our economy. And our first focus was economic recovery; and, therefore, the stimulus and the economic recovery tax legislation provided needed tax relief to small businesses, to families, and to individuals around this country.

Now we are focused on that, as well as simplification; and it is very important given the fact that we do have an increasingly complex Tax Code and that the burden of compliance with that code is greater and greater, that we on a bipartisan basis focus on this compliance cost and, therefore, on simplifying the code.

Before us today we have a great piece of legislation. It is not the silver bullet, does not do it all; but it helps and it tells small businesses that if they want to go out there and buy new equipment to be able to expand their plant, to hire new people, to keep this economy moving, we are adding jobs, we have economic growth that is the best we have had in 20 years in this country, that we will enable them to write off $100,000 worth of new purchases rather than $25,000 worth of new purchases.

We are telling them that businesses that are a little bit smaller than the very smallest businesses would be able to take advantage of this as well by being sure that the definition of what businesses can qualify is expanded.

Now, this is good legislation. We are also telling small businesses they can use the cash accounting method, which saves them money, which saves them complexity in not having to hire accountants and additional professionals, rather than going to the accrual method. So we are saying we are going to index that to inflation to help small businesses. And, finally, we are saying that our Tax Code has too many provisions that are no longer relevant, deadwood provisions that cause complexity and confusion. We are going to get rid of those provisions in the code, particularly as they affect small businesses.

So, again, I commend my colleague from Illinois for bringing this legislation before us today. This is the first step in a long march towards simplifying our Tax Code, and I would hope that we will have support across the board on a bipartisan basis for this legislation.

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

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4841) to amend the Internal Revenue Code of 1986 to simplify certain tax rules for individuals, as amended.

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

Mr. Speaker, I rise in strong support of the legislation. This is introduced by my friend and our colleague, the gentleman from Georgia (Mr. Burns). This legislation clears up a number of issues that affect the Tax Code and its complexity as it relates to individuals as compared to small businesses. So it is a natural companion piece of legislation to the legislation that we had before us a moment ago on this floor.

Studies have shown that individual taxpayers now spend over 3 billion

hours per year complying with our Tax Code, filling out tax returns, keeping records and so on, and that cost of compliance, as we talked about in the earlier debate, is now exceeding $85 billion a year.

This bill is not the sales tax bill. It is not the flat tax bill. It is not the panacea. It is not the silver bullet, but it is an important and very valuable contribution to the effort of simplifying the Tax Code for individuals.

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

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

Mr. Speaker, I appreciate my colleague from Texas indicating that he is not supportive of these simplifications. But I would say that if we use the argument that we do not need to legislate because it can be done administratively, then we will have a lot of problems in our tax administration system because all that the IRS has the power to do, a lot of the things that we have done in this Chamber, including many of the reforms we did in 1996 when we totally restructured the IRS, we would be waiting forever sometimes.

The gentleman from New York (Mr. Houghton) is retiring from this Congress. We want to get this done before he leaves. The IRS has had since 1982 to make these changes on the 1040EZ and the 1040A, and they have certainly had over the last decade as it has been increasingly evident that they have not adjusted the level for inflation, and we want taxpayers to be able to use this simpler form if they can.

So the argument that they can do it administratively at the IRS and, therefore, we should not touch it seems to me to be an unusual one when there is, as in this case, such an urgent need to make the change.

So I do think the legislation before us is important. I also think that the 6 million Americans, estimated by the IRS by the way, who make a mistake on their filing status because they think that ``head of household'' is folks who are exclusively married, ``head of household'' is the change that we make in this legislation, to say that that is not a change that is meaningful, I think is inaccurate because those 6 million people by indicating the wrong filing status get in trouble with the IRS.

Some of them get audited because of that. That causes enormous problems for those taxpayers, particularly low-income taxpayers who do not have the

professional help to be able to deal with these audits. It also causes tremendous downstream costs to the IRS as they try to untangle the mess that sometimes occurs when somebody chooses the wrong filing status.

So I think this legislation is important. I think it is good legislation. Again, it is not everything. It is not meant to be everything. But I do not think it should be legislation that is not supported by the other side of the aisle.

Mr. Speaker, I yield such time as he may consume to the gentleman from New York (Mr. Houghton), the chairman of the Subcommittee on Oversight. He has devoted himself to simplification. It is his legislation in terms of international tax simplification that has really been at the forefront on a bipartisan basis over the last several years.

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

I would tell my colleague from Massachusetts who had expressed concerns about the so-called birthday rule, we actually took it out of the legislation because of concerns expressed by the gentleman's side of the aisle.

With regard to AMT, I commend the gentleman for his work on that over the years. As the gentleman knows, in 2001 and 2003, we put in place increases in the threshold for the first time in many, many years which has saved millions of taxpayers from having to go into the AMT. We also have an extender bill that passed this House to extend that into the future.

I yield to the gentleman from Massachusetts.

Reclaiming my time, I will tell the gentleman that I actually have had legislation in to repeal the AMT for many years. So I go even further than the gentleman goes in terms of AMT relief. So the gentleman is not the only one who is interested in it; but he has brought focus to it and we appreciate that, as has the gentleman from New York (Mr. Houghton).

I would also say, though, that this Congress has made some progress. It is a tough issue. Because we did not index it, therefore AMT goes to more and more taxpayers every year. By not indexing the threshold, more and more middle-income taxpayers, particularly those with children, get caught in it.

Mr. Speaker, we now have with us the chairman of Committee on Ways and Means, who has worked hard on these tax simplification bills before us, including this individual tax simplification bill that was authored by the gentleman from Georgia (Mr. Burns).

Mr. Speaker, I yield such time as he may consume to the gentleman from California (Mr. Thomas), chairman of the Committee on Ways and Means.

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

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

Mr. Speaker, I appreciate the gentleman's defense of the alternative minimum tax. We just fundamentally disagree. We do not think there ought to be an alternative minimum tax. We think we ought to change the code. If Members think people should not get preferences in the code, change the preferences. Let us be honest about it.

But I am glad the gentleman is honest about it and saying he supports it, and it was done in a Democrat Congress and he would like it to continue. I would also say that the gentleman's attempt to imitate a southern accent, and my colleague from southern Texas can confirm this, is as bad as his analysis of the underlying legislation before us. This is not everything, but it is a good bill.

Let us talk about the facts. We have had a lot of interesting conversation about what it does and does not do, but let us get to the facts. Number one, it clarifies a misleading part of the code which has to do with a filing status title. It will help about 6 million Americans who file the wrong way because it is misleading.

It is going to help with regard to letting people use the short 1040EZ and 1040A tax forms, which will help save millions of dollars and also millions of hours of taxpayer work in terms of putting their taxes together.

Finally, it eliminates a bunch of deadwood. The ``head of household'' filing status, which is the first thing it does, is generally for single taxpayers with dependents, we changed it to say that, ``single head of household.'' That makes it clear to the vast majority of married taxpayers that they are not eligible.

Again, about 6 million of them a year inappropriately choose that filing status when they should not, and it causes great problems to them and to the IRS. In fact, the IRS gets over a million calls a year just about filing status. At any given time, there are 18 million people who might be subject to audit because they choose the wrong filing status. Being subject to audit, especially to lower-income taxpayers, is devastating, and so we are trying to help those people.

It also expands the 1040EZ and the 1040A by allowing taxpayers with up to $100,000 in taxable income, rather than $50,000, and who have interest payments, to be able to use these shorter forms.

What is the difference? The normal tax forms takes on average 28.5 hours to fill out. The 1040EZ, 3.5 hours. That is a huge time savings for Americans who do not have enough time to do the things that they want to do, to take that time away from filling out taxes. Again, it is a tremendous savings of money and time.

Yes, the IRS may be looking at this, but they have not done it, and it is the right thing to do, so let us do it. It has not been adjusted since 1982.

Finally, getting rid of some of these deadwood provisions is extremely important, cleaning up the code for individuals because people make mistakes based on these inaccurate provisions in the code. We have gone through it using the Joint Committee on Taxation, professional analysis, to determine what is appropriate and what is not.

This is good government legislation. I urge my colleagues on both sides of the aisle to strongly support this.

Mr. Speaker, I yield for the purpose of making a unanimous consent request to the gentleman from Minnesota (Mr. Ramstad).

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

Mr. Chairman, I rise today to express my support for H.R. 4818, the FY 2005 Foreign Operations Appropriations bill, and I want to commend Chairman Kolbe and Ranking Member Lowey for including $20 million for the Tropical Forest Conservation Act. This is the amount requested by President Bush in his FY 2005 Budget submission.

The TFCA is based on the previous Bush administration's Enterprise for Americas Initiative, and authorizes the President to restructure debt in exchange for conservation of threatened tropical forests worldwide.

Tropical forests are important. They absorb carbon dioxide from the atmosphere to help reduce greenhouse gases. They help regulate rainfall on which agriculture and coastal resources depend, and their plants are a vital source of new medicines, including treatments for cancer.

Regrettably, about 30 million acres of tropical forests (an area larger than the State of Pennsylvania) are lost each year because many countries are forced to exploit timber and other natural resources to generate revenue to pay their external debt.

Seven TFCA agreements have been concluded to date: Bangladesh, El Salvador, Belize, Peru, the Philippines, Panama and Colombia. These agreements have generated more than $70 million in long-term income tropical forest conservation and will contribute to the conservation of 40 million acres of tropical forests. Private donors have contributed more than $5 million to TFCA swaps, leveraging the U.S. government funds. Active deals are currently being negotiated with Jamaica and Sri Lanka. Several other countries that have expressed interest or are eligible for TFCA.

On June 24th, The International Relations Committee unanimous approved H.R. 4654, a bipartisan bill I introduced with our colleague, Tom Lantos, and 32 other cosponsors to reauthorize TFCA through FY 2007. That bill was developed with the Bush administration, the Nature Conservancy, the World Wildlife Fund, Conservation International and the Wildlife Conservation Society. We expect H.R. 4654 to come to the floor in the near future.

TFCA is a worthy program that is working well. The Bush Administration is a strong proponent of the Tropical Forest Conservation Act, and it has bipartisan support in the Congress. I again thank the leadership for providing the funding in H.R. 4818 so TFCA can continue to protect some of the world's most threatened natural resources.

Mr. Speaker, there has been a lot of discussion on this floor over the past year about the tax relief we passed last year for the American people, for our families, small businesses and investors. In fact, even this morning I heard again how we could not afford this tax relief, how it was wrong, how we should not have done it. I have heard again and again how it has robbed our Federal Treasury.

It should be interesting to note, then, that we have just learned that the tax receipts coming into our government this year are higher than they were before we put these tax cuts in place. Why? Because the tax relief is working to stimulate the economy and increase revenue. More people are working. Salaries are higher. Corporate revenues are higher. This means the economy is strong. Robust job growth has led to more taxpayers and more taxable income. Those are facts. Tax collections this year are $48 billion higher than last year. In June our receipts were 11 percent higher than our receipts of June a year ago.

Earlier on the floor, one of my colleagues said, Gee, the other side is talking about how the economy is good. They are using statistics.

Well, yes, we are using statistics because that is what the American people care about is how their jobs are doing, how the job growth is coming. Nationwide more than 1.5 million jobs have been created in the past 10 months. This means that we are creating not just jobs but good jobs. The pessimistic view is simply wrong. Real wages are up 11 percent since December of 2000. Payroll tax revenues are up. We are creating real jobs, good jobs. This will continue because of the tax relief.

Mr. Speaker, I thank the gentleman for yielding me time, and I appreciate his clarification and also the clarification of the gentleman from New York (Mr. Crowley) as this legislation before us relates to the issue of importation of prescription drugs.

I do rise in very strong support of the U.S.-Australian Free Trade Agreement. As the gentleman from New York (Mr. Crowley) has said, we have a long-standing friendship with Australia. We also have a lot of economic interest and move forward with this particular legislation. Knocking down barriers always leads to a fairer and a more healthy relationship between countries

and for better economics between both countries.

In this case, this bipartisan agreement will give a boost to our large and growing investment links with Australia and will help strengthen the U.S. economy. President Bush and Ambassador Bob Zoellick deserve a lot of credit for moving forward strongly with this particular agreement and for their continued determination on bilateral agreements in general.

This agreement will help small business and manufacturers quite a bit in my home State of Ohio. Australia is now number 11 in terms of countries to which we export. Total exports are now valued at $389 million. Ohio primarily exports high-value products to Australia, aircraft engines and parts, auto parts, forklift trucks, pet food, household appliances. If the Free Trade Agreement was in effect last year, we would have seen over 93 percent of those exports, including again some of these manufactured high-quality, high-value exports, 93 percent of them would have entered Australia duty free.

Ohio's exports to Australia directly support about 1,800 good-paying jobs in Ohio. And, by the way, there are 17 Australian-owned companies in Ohio, which also employ roughly 1,800 people. 1,300 of those positions, by the way, are in manufacturing.

Trade with Australia supports countless other high-paying jobs in areas such as transportation, finance and advertising. This agreement is good for Ohio. It is good for jobs. It is good for relations with one of our great friends, Australia. Opening markets across the globe to Ohio businesses is the key to keeping our Buckeye economy strong.

The U.S.-Australia Free Trade Agreement is also important because Australia and the U.S. share a lot of similar goals in terms of international trade. We are both supporters of achieving trade liberalization in the current round of trade talks. We are both pursuing market access through regional and bilateral trade agreements. Another reason to support this agreement.

With overwhelming support today, we will be helping to fulfill President Bush's vision of a world that trades in freedom.

Mr. Speaker, I rise to honor the memory of Army Sergeant Charles A. Kiser, a brave soldier, who died Thursday, June 24, 2004, in an explosion near Mosel, Iraq. Sergeant Kiser is a native of Clermont County, OH, an area I represent.

Sgt. Kiser grew up in Amelia, OH, attended St. Bernadette School, and began competing in track in the third grade. He graduated from McNicholas High School in 1985, where he was a champion sprinter and later a member of the University of Cincinnati's track team. It is said that he was one of the most talented sprinters ever at U.C. Several of Sgt. Kiser's records still stand at U.C., including the 300 yard dash indoors and the 300 meters.

After a year at the University of Cincinnati, he left to join the Navy. He spent 7 years in active duty, mostly in Italy, where he met his wife, Debbie, who was also in the Navy. Sgt. Kiser followed that with 7 years in the Naval Reserve.

They settled in Wisconsin, and had two children, Alicia and Mark. Two years ago, Sgt. Kiser joined the Army Reserve and trained at Ft. McCoy, Wisconsin. He left for Iraq in late 2003 with the 330th Military Police Detachment, based in Sheboygan.

Close to his family, Sgt. Kiser grew up with six women: his mother and five sisters, all of whom still live in the Clermont County area. Last night, there was a community-wide celebration of Sgt. Kiser's life at the Clermont County Courthouse in Batavia.

All of us in the Cincinnati area are grateful for Sgt. Kiser's service to our country, and express our deepest sympathy to his family and many friends.

Mr. Speaker, June is National Homeownership Month. Stronger families, better schools, and homeownership produce healthy neighborhoods and communities.

When people own their homes, other benefits follow, such as economic security and family stability. Over the years, home values have generally increased, making them a good investment and a great way for families to build up assets that can be used for everyday needs, unexpected setbacks, and even helping to send a child to college.

Neighborhoods where people own homes are more stable. People tend to take better care of property they own and care more about the rest of the neighborhood as well. Homeownership also leads to a more vibrant community because home sales attract grocery stores, restaurants and other small businesses that add stability and job opportunities.

With all these benefits, it is discouraging that there are some areas in our country where the homeownership rate is very low. In my home state of Ohio, the City of Cincinnati's homeownership rate is 39 percent, far below the national average of 68 percent. And even in the rural areas of my district where the percentage of home owners is higher, we are still well below the national average.

Ohio has a shortage of affordable homes in inner-city and rural areas. This is also true in many other states. To help address this problem, Representative Ben Cardin and I introduced H.R. 839, the Renewing the Dream Tax Credit Act, which is based on a proposal advanced by President Bush. The measure would make a tax credit available to developers or investors that build or rehabilitate homes for sale to low- and moderate-income buyers in these areas. H.R. 839 has the support of nearly 300 House members, and would make it more attractive for developers to create affordable housing in urban and rural areas in which the need is greatest.

Mr. Speaker, when people buy a home, they make an investment in that community. Enacting H.R. 839 will help make homeownership achievable for more Americans.

Mr. Chairman, I would like to submit this letter which I sent to Secretary Norton. This letter concerns an amendment to H.R. 4568 regarding winter use of snowmobiles at Yellowstone and Grand Teton National Parks and the John D. Rockefeller, Jr., Memorial Parkway.

Congress of the United States,

House of Representatives,

Washington, DC, June 18, 2004

Hon. Gail A. Norton,

Secretary of the Interior, U.S. Department of the Interior,

Washington, D.C.

Dear Secretary Norton: I am writing regarding winter use of

snowmobiles at Yellowstone and Grand Teton National Parks and

the John D. Rockefeller, Jr., Memorial Parkway.

As you know, this week the House of Representatives voted

narrowly to defeat an amendment to the House Interior

Appropriations bill, which provided for a total ban of

snowmobile access to the parks. I voted against the

amendment, but only with the understanding that the National

Park Service intends to implement a plan that ensures the

protection of the wildlife and natural beauty of these

American treasures for current and future generations.

I believe the concerns of snowmobile emissions and noise at

the parks are valid and must be addressed. I realize that the

newer ``four-stroke'' snowmobiles reduce emissions and noise

significantly. While I believe these advances in snowmobile

technology merit reconsideration of winter use at the parks,

I believe the Park Service must carefully consider the short

and long-term alternatives. I seek your assurance that NPS

will determine an appropriate winter use plan that balances

the need to protect the parks' unique environment with

appropriate means of access, even if that includes the

snowcoach only alternative.

I understand the Park Service is considering alternatives

that include one that would allow only snowcoaches, and

others that include restrictions on the number of snowmobiles

that may enter the parks each day, technology requirements,

guiding requirements, and where snowmobile travel is

appropriate. I do believe our parks should be accessible. But

if an alternative that includes snowmobile access is to be

implemented, I think it is critical that such access not

detract from the experiences of those who prefer to explore

the parks in other ways.

I appreciate the Park Service's efforts to find a balanced

solution that I hope will enhance the experiences for

everyone who visits these magnificent parks. Thank you for

considering my comments as NPS moves forward with its short

and long-term winter use revisions.

Sincerely,

Rob Portman,

Representative.

Mr. Speaker, I rise today to honor a friend and constituent, Joseph A. Pichler, who retired on June 24, 2004 as Chairman of the Board of The Kroger Company, which is headquartered in my hometown of Cincinnati. He has been an exemplary leader in academia, business and our community.

After earning an undergraduate degree from Notre Dame and a Master's and Ph.D. from the University of Chicago, Joe taught for 15 years at the University of Kansas School of Business, and served as Dean for six years. From 1968 to 1970, he was Special Assistant to the U.S. Department of Labor's Assistant Secretary for Manpower.

Joe has had a truly extraordinary business career, bringing energy, hard work and leadership to every assignment. Before his election as Kroger's Chairman, Joe served the company as Chief Executive Officer; President and Chief Operating Officer; and Executive Vice President. Joe joined Dillon Companies in 1980 as Executive Vice President, and was elected to Kroger's Board of Directors when Dillon merged with Kroger in 1983.

Joe has pursued community service in our area with equal enthusiasm. He heads the Cincinnati Center City Development Corporation's (3CDC) working group that created a new development strategy for Cincinnati's Washington Park area. For many years, Joe and his wife, Susan, have volunteered in the historic Over-the-Rhine neighborhood near Kroger's headquarters building, and we worked together on the new National Underground Railroad Freedom Center.

Last year, Joe asked me to help craft a legislative solution that would allow Cincinnati's ``One Stop'' Employment Center to continue serving clients in the Over-the-Rhine area. Since then, other Ohio counties have received similar legislative assistance. Joe's role in keeping these key job training facilities open cannot be overstated.

All of us in Cincinnati congratulate Joe on his retirement from Kroger and wish him the best in the new challenges ahead.

Mr. Chairman, will the gentleman yield?

Mr. Chairman, I wanted to rise to congratulate the chairman on balancing difficult competing interests in this legislation. Once again, I think we will see on final passage what a good job he has done.

But in particular, I want to thank him very much for helping with regard to our energy needs at the Port Smith Gaseous Diffusion Plant. Once again, he has provided the President's request and has been instrumental in being sure that we have not only jobs in southern Ohio but that the centrifuge technology moves forward, which is so critical to our Nation's energy security.

So, again, I rise to congratulate the chairman, and I look forward to working with him going into the future, and congratulate him on his bill and strongly support it this afternoon.

Sequential Votes Postponed in Committee of the Whole

Mr. Speaker, I rise today to announce that I am joined by Tom Lantos and 28 of our colleagues in introducing a bill to reauthorize the Tropical Forest Conservation Act (TFCA) through FY 2007. This bipartisan conservation incentive program helps to protect the world's most valuable tropical forests through ``debt-for-nature'' mechanisms.

This bipartisan reauthorization we are introducing today was developed with the Bush Administration, the Nature Conservancy, the World Wildlife Fund, Conservation International, and the Wildlife Conservation Society. The Administration and these highly respected environmental organizations are to be commended for all of their excellent work on the TFCA and this bill.

In the 105th Congress I, along with our former colleagues Lee Hamilton and John Kasich, introduced the legislation that established the TFCA. It was overwhelmingly approved and enacted in 1998. The TFCA was reauthorized in 2001 through the end of this year.

The TFCA is based on the previous Bush Administration's Enterprise for the Americas Initiative (EAI) that allows the President to restructure debt in exchange for conservation efforts in Latin America. The TFCA expands on the EAI and allows protection of threatened tropical forests worldwide. A conservative estimate of 39.5 million acres of tropical forests will be protected by TFCA agreements since its enactment in 1998.

The United States has a significant national interest in protecting tropical forests in developing countries. Tropical forests provide a wide range of benefits. They harbor 50-90 percent of the earth's terrestrial biodiversity. They act as ``carbon sinks,'' absorbing massive quantities of carbon dioxide from the atmosphere, thereby reducing greenhouse gases. They regulate rainfall on which agriculture and coastal resources depend, and they are of great importance to regional and global climate. Furthermore, tropical forests are breeding grounds for new medicines. Twenty-five percent of prescription drugs come from tropical forests. The United States National Cancer Institute has identified over 3000 plants that are active against cancer. Seventy percent of them can be found in rainforests.

Regrettably, tropical forests are rapidly disappearing. It is estimated that 30 million acres (an area larger than the State of Pennsylvania) are lost each year. The heavy debt burden of many countries is a contributing factor because they must resort to exploitation of their natural resources (particularly the extraction of timber, oil, and precious metals) to generate revenue to service their external debt. At the same time, poor governments tend to have few resources available to set aside and protect tropical forests. The TFCA addresses these economic pressures by authorizing the President to allow eligible countries to engage in debt swaps, buybacks or reduction/restructuring in exchange for protecting threatened tropical forests on a sustained basis.

The debt for nature mechanisms in the TFCA have proven to be an effective, market-oriented means to leverage scarce funds available for international conservation. The host country places an amount in its tropical forest fund that typically exceeds the cost to the U.S. government of the debt reduction agreement. Furthermore, because these tropical forest funds have integrity and are broadly supported within the host country, conservation organizations are interested in placing their own money in these tropical forest funds producing additional leverage of Federal conservation dollars.

Seven TFCA agreements have been concluded to date: Bangladesh, El Salvador, Belize, Peru, the Philippines, Panama and Colombia. These agreements have generated more than $70 million in long-term income commitments for tropical forest conservation. Private donors have contributed more than $5 million to TFCA swaps, leveraging the U.S. government funds. Active deals are currently being negotiated with Jamaica and Sri Lanka. Several other countries have expressed interest in the program including Guatemala, Ecuador, Paraguay, St. Vincent, Botswana, Costa Rica, the Dominican Republic, India, Indonesia, Brazil, and Kenya.

This bill will improve the TFCA and reauthorize it at $20 million in FY 2005, which is included in the President's budget request; $25 million in FY 2006; and $30 million in FY 2007.

The Tropical Forest Conservation Act is an excellent program that is working well and worthy of reauthorization. I urge all members to support this important, market-oriented approach to conserving the world's most threatened tropical forests.

Mr. Speaker, I thank my chairman for allowing me to speak this morning, and it is true, this is a non-binding exercise. On the other hand, it is a very important debate, and it is a philosophical difference.

I appreciated the comments from my colleague from Wisconsin talking about the need to get the deficit down. I think what we have learned over the last couple of decades is the only way to get the deficit under control is to grow the economy and restrain spending. We learned it in the 1990s. We are relearning it now, and what is exciting to me is the fact that part of that, which is restraining spending, we are doing with regard to the budget and the budget that the House passed and based on the deeming resolution will keep our spending under control in the House this year. That is very important, keeping spending at about 4 percent, trying to keep it close to what the family budget is is extremely important.

Second, we are growing the economy, and there is an incredible story out there. It is probably the most underreported story of the year. The only economic indicator that is not improving right now is what we are hearing from the other side of the aisle about the economy. Jobs are increasing, fastest growth in 20 years. The unemployment rate is now 5.6 percent in this country, down from 6.3 percent. That makes it lower than the average unemployment in the vaunted 1990s, in the 1980s or the 1970s. People are going back to work.

Just last month, we created over 225,000 new jobs in this country. We have created over 1.4 million jobs in this country in the last 9 months. People are going to work, and not only are

jobs increasing but they are good jobs. Wages are going up. Wages are going up faster than they did in the 1990s. We are seeing actual take- home pay going up. We are seeing productivity high, inflation low, interest rates are low. We are seeing the economy that is the envy of the rest of the industrialized world.

Part of the reason for that, I believe a big part of it, is that this Congress has taken the right steps in terms of fiscal policy, keeping spending under control and growing the economy by smart tax relief that provides incentives for growth. That is what the Bush tax cuts were all about. That is what is under attack today.

If my colleagues are to vote for the gentleman from Wisconsin's (Mr. Obey) amendment, my colleagues are showing that they have a philosophical difference with that. Instead, my colleagues believe that just as the economy has turned, just as jobs are coming back, just as we have seen real growth and real wages, that we ought to be repealing the very tax relief that has led to that. I do not get that.

Here is a chart showing that today there are more Americans working than ever before. Employment is at a record high in May of 2004, 138.8 million people. Here is what unemployment would be without the tax relief that we passed in the last 3 years. Again, 5.6 percent unemployment today. Without the tax relief, we believe it would be over 7 percent. Now, what does that translate into? Over 2 million jobs. Over 2 million jobs.

I just think it is crazy that at the point at which we are turning the corner, we are bringing back jobs, things are going so well, that again the rest of the world is looking up and saying now America is the engine of economic growth again, that the people back home who punch a time clock every day are seeing their wages going up, that we would want to jeopardize that.

Increasing spending is, again, a philosophical divide. We can talk about whether we should be increasing spending within the allocation we have for homeland defense, intelligence and so on as we did yesterday on the floor of the House, but let me show my colleagues what would happen with the gentleman from Wisconsin's (Mr. Obey) amendment.

He said it is an increase in spending of about $14.2 billion next year. Well, over a 10-year period, that is $150 billion. Here is the spending increase that is in the legislation that is before us today or in the resolution before us. Again, we are not going to get the deficit under control unless we restrain that spending. Adding another $150 billion over 10 years is not the solution, $194 billion over 10 years. It is more than 150.

Now, let us talk about the tax increase. The tax increase, the gentleman from Wisconsin (Mr. Obey) said, is $18.9 billion in fiscal year 2005, and it is, but we have to take that over 10 years, too. Let us look at the 10-year number there. We are talking about individual income tax increases by $269 billion, over $250 billion over the next 10 years.

I know, again, we have a philosophical difference on who should be paying. Let me just make the point that if those tax returns that the gentleman from Wisconsin (Mr. Obey) talked about, that he wants to affect, over 75 percent of those tax returns have business income. Why is that? Because 90 percent of small businesses in this country are not C corporations. They are so-called pass-through entities. What does that mean? They pay taxes at the individual level.

So part of what my colleagues are doing, there is no free lunch around here. When they are saying they are going to go after the rich, who are they going after? They are going after a lot of businesses. These are the entrepreneurial businesses, the small businesses that are pass-through entities, so-called subchapter S companies, sole proprietors, LLC companies, partnerships that are creating the jobs out there.

Look, in our districts, it is not the large companies that are creating these net new jobs. It is these companies. It is the entrepreneurial companies that are taking a risk, that are pass-through entities. Ninety percent of small businesses pay taxes at the individual level. We are hitting them hard if we do this.

Again, let us not take this risk. Let us go back to what we know works. Let us restrain our spending. Let us grow this economy. Let us not go back to taxing and spending. That does not work. It is going to hurt our economy. It is going to hurt the very workers the gentleman from Wisconsin (Mr. Obey) said he would like to help.

Mr. Chairman, I thank the chairman of the Committee on the Budget for yielding me time, and I thank him for bringing this resolution to the floor.

What we are talking about in this resolution is not so much budget process reform, although we will have an opportunity through various amendments to get into that issue. What we are talking about here is enforcing the budget we have.

I think what the Committee on the Budget reported out and what is before us on the floor today is the right way to do it, and that is putting a cap on discretionary spending and having PAYGO apply to mandatory.

I was going to talk a little about the importance of growing the economy to our budget, but I think we have really gone over that in the previous debate. Instead, let me talk for a minute about what my friend from Maryland was just saying with regard to tax relief.

If in 2001 we had applied PAYGO to the tax relief, which was in effect, by the way, we would not have the economy we have today. That is what I believe. I believe that the economic growth we have seen over the last year, and remember now, we have added 1.4 million jobs to our economy in the last 9 months, we have the best growth in 20 years; we are the envy of the entire industrialized world; we are growing jobs; we are increasing wages; we are seeing real growth, which is resulting in higher revenues, which is why CBO is going to come back later this year and tell us our deficit is not as big this year as they thought it was going to be, because more revenue is coming in. If we had PAYGO on taxes in 2001 and applied it, we would not have put the tax breaks in place. That is my belief.

Second, there is a bias in our system right now. Think about it. With regard to spending, the gentleman said it is hard for him to vote for cuts in spending. It is not hard for any of us to vote for increases in spending. We do it all the time. Then it becomes a baseline. Then, in terms of the budgetary consequence, it continues, forever.

There is no budgetary consequence once an appropriation, an authorization, expires; but there is when tax relief expires. When tax relief expires, there is a budgetary consequence.

We have to find a way to account for it. That is a bias within our system. And to add PAYGO to both would, therefore, be unfair, both because the tax cuts, unlike spending, add directly to economic growth. And it is incredibly important, we can have that debate without having the PAYGO, but have that debate, an honest debate. Second is the fact that in our current system, let us face it, there is a bias right now in favor of spending.

I thank, again, the chairman for bringing this to the floor. I think it is a responsible approach to just enforcing the budget we have, to be sure the chairman of the Committee on Appropriations can do his job, and do it well.

Mr. Chairman, I would tell the gentleman two things. Number one, at that time we were working on a bipartisan basis to try to get a balanced budget agreement through the Congress, which we did support. We wanted a cap on spending, you wanted it on taxes, and we came up with a compromise in order to get that 1997 balanced budget agreement through, which was a good agreement in the sense that it restrained spending. That part of it was good, and the economy grew; and I think we should learn from that.

Today, what we are trying do again is to get this economy growing and restrain spending through these caps. That is the key.

Mr. Speaker, I am here also to talk about our economy. The gentleman from Michigan (Mr. Camp) just talked about all the positive economic indicators. I guess one could say the only economic indicator that is not positive are the statements from the presumptive Democrat nominee for President. And I do not know why he is doing it because it hurts the economy to badmouth the economy, to talk it down. It reduces consumer confidence at a time when we need to be sure that consumers are confident about where we are.

Before me, others talked about the fact that our unemployment numbers have gone from 6.3 percent down to 5.6 percent. That is lower than the average in the 1970s, 1980s, or 1990s. 1.4 million jobs have been created in the last 9 months.

Let me talk about those jobs. These are good-paying jobs. After tax income increased at a strong 4.9 percent annual rate in the first quarter of this year. Think about that. Hourly compensation in the last year has gone up 2.7 percent. That is faster than the 1.5 percent in the 1990s and people talk about its great growth. Average weekly earnings increased 2.5 percent from the same period a year ago.

So this notion that somehow we are creating jobs but they are not the right jobs or not increasing income are just wrong. Income is up. Productivity is up. Jobs are up.

Mr. Speaker, some politicians who are serving their own special interests are bad-mouthing this economy, but it is strong and good. It can get stronger if we take the right steps here in Congress.

Mr. Speaker, yesterday I was absent attending meetings in my Congressional District in Ohio and missed the votes on rollcall No. 276, on H. Res. 591, designating Community Banking Month; rollcall No. 277, on H.R. 4363, the Helping Hands for Homeownership Act; and rollcall No. 278, on H. Res. 660, Congratulating Randy Johnson with the Arizona Diamondbacks on pitching a perfect game.

Had I been present, I would have voted ``yes'' on rollcall No. 276, ``yes'' on rollcall No. 277, and ``yes'' on rollcall No. 278.