Senator Thune and the tax cut for the american people

Senator Thune and the tax cut for the american people

Sen. John Thune [R-SD]: Mr. President, as many of my colleagues have already noted, the jobs numbers today were very bleak and should cause great concern for all of us as we look at steps we can take to get this economy growing again. But that is why the CBO report that came out yesterday also is so troubling because it indicated the Democratic proposal, the stimulus plan before us, would create as few as 1.3 million jobs--as many as 3.9 million, to be fair, but as few as 1.3 million jobs. Well, a trillion dollars is a terrible price to pay for a bill that may create as few as 1.3 million jobs over, I might add, a 2-year period.

It also went on to say, the CBO report did, that it would reduce the GDP growth in the outyears. So not only does it create potentially a very small amount of jobs--1.3 million over a 2-year period--but it also diminishes the amount of GDP growth we would experience in later years.

Now, if it, in fact, does create only 1.3 million jobs, if this trillion dollar plan--again, all based on borrowing from future generations--does create as few as 1.3 million jobs, if you do the arithmetic on that, if you spend $1 trillion, and you only create a little over a million jobs, that is $800,000 per job. Try and think about how you can convince your constituents back in your home States about the need to spend $800,000 to create a single job.

I mentioned this yesterday, but I will repeat it again: For the people in my State of South Dakota, the average annual salary is about $30,000 per year. So to think about spending $800,000 to create a job is something that is going to be very hard to accept for a lot of people around this country, which is why I believe, and so many people around the country are rallying and saying, this is the wrong direction in which to head.

I happen to agree with that assessment, and I think there are some things that could be done that would make this process more fair in terms of including ideas that Republicans have to put forward but, more importantly, to get a product that is more effective--more effective--at creating jobs at a lower cost.

Now, many of us have tried to improve this bill. I supported a McCain amendment yesterday, a comprehensive approach that is much better in terms of addressing the issue and much better focused in terms of job creation at about half the cost of the underlying bill, the majority bill we are debating today. So we tried to make this bill more focused and more fiscally responsible. I think putting the focus and the emphasis on job creation is the right place to be. But many of the efforts we have made to that end have failed. We have also offered amendments to cut much of the wasteful spending out of this bill, most of which have been defeated.

So what I have sort of concluded is, as much as we tried to make this a better bill by cutting wasteful spending, by making the focus on job creation, by trying to reduce taxes on small businesses and middle-income taxpayers, which would get more money back into the economy, and emphasize less spending on Government programs in Washington, DC, where the bulk of this is committed, that is a much better approach, and many of our amendments have been focused in that direction. But, as I said, none have been accepted.

I have one more amendment I have filed and I hope to have an opportunity to call up. It is sort of a last-ditch effort to bring some reason to this whole debate. But what it essentially would do is take the total cost of the Democratic bill--about $900 billion without interest; $900 billion, when you add in the interest costs, as I said before, you get up to about $1.2 trillion or north of that, all of which is borrowed money, borrowed from future generations--but take that total amount of $900 billion and divide it by every tax filer in this country--anybody who files an income tax in this country--and basically write them a check.

Now, it is probably surprising to most of us here what you could do with that. But for an average individual filing a tax return in this country, you could write them a check for $5,143; for a couple filing jointly, $10,286.

Now, to be fair, I also wrote the amendment so anybody making more than $250,000 a year would not be eligible. I tried to make this so you cannot argue this is a tax cut for the rich. So anybody who makes more than $250,000 would not be eligible. All filers who have under $250,000 in taxable income would be eligible under this amendment. You could actually write a check to an individual filing for $5,143 dollars; and to a couple filing jointly, a check for $10,286.

I think that is a lot of money in most people's family incomes and it makes a lot more sense, in my judgment, than spending $900 billion on programs that many of us know will not work, creating new bureaucracies in Washington, DC, at a very high cost per job. As I said, if the CBO numbers are right on the low end--1.3 million new jobs--and you divide that, do the arithmetic on that, you are talking, in round numbers, about $800,000 per job. What kind of sense does that make?

It is pretty clear, in my opinion, and I think in the opinion of most of the American people, this is very misdirected in terms of the mission of this whole thing. The intention is great, but the substance of this particular piece of legislation is very flawed.

I would add one last thing; that is, we talk about economic models and analysis and methodology, but the President's own chief economic adviser put together a methodology about a year ago--a little over a year ago--that said for every dollar of tax cuts you get a multiplier of 2.2 percent increase in GDP. So if you cut taxes by a dollar, GDP increases by 2.2 times.

It seems to me, at least, that you can take that methodology--and it seems intuitive to most Americans--when you reduce their taxes, middle-income families' taxes and taxes on small businesses, which create the jobs in this country, you get a much better outcome in terms of GDP growth, in job creation, than sending a bunch of money into Government programs here in Washington, DC, many of which, I might add, are new programs that will not get up and be started for a very long time. There will be a tail on them. As a consequence, you will not see the result in the short period of time we are trying to target here--the temporary approach to this--that actually creates jobs and helps pull us out of the economic crisis we are in.

That is an amendment I have filed. It takes that total amount--$900 billion--breaks it down on a per-filer basis, and if you are an individual filing, you can get a check for $5,143, and if you are a couple filing jointly, you can get a check for $10,286.

But I wish to see us approach this in a different way. A lot of amendments, as I said, have been offered--some good alternatives. The McCain alternative we voted on yesterday makes a lot of sense to me. It does it at about half the cost, and is a lot more effective at creating jobs. That was defeated, as have been all the other amendments we have offered to make this more fiscally responsible, more focused, and more targeted on job creation.

With that, Mr. President, I yield the floor and thank the Chair.