Death Tax Repeal Permanency Act of 2005 - Motion to Proceed

DEATH TAX REPEAL PERMANENCY ACT OF 2005--MOTION TO PROCEED -- (Senate - June 08, 2006)

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Ms. MIKULSKI. Madam President, today the Senate is considering whether to repeal the estate tax. I believe strongly there are problems with the estate tax. Most importantly, it needs to be reformed so it applies to fewer people.

To ensure our Nation's economic competitiveness, government must reward thrift, hard work, and entrepreneurship. It cannot punish those who have saved and worked hard. Instead, we should support our small businesses and family farms--the engine of economic growth in America.

To do this, Congress must raise the exemption for the estate tax. In 2006, estates worth more than $2 million are subject to the tax. This is too low and subjects too many Americans to the estate tax. That exemption needs to be raised. The baby boomers are growing older and approaching retirement, and many have attained some measure of economic prosperity through their years of hard work. They should not be punished for this well-deserved success. Tripling the exemption to $6 million will make sure that the estate tax continues to target an extremely small group of very wealthy Americans. In fact, with an exemption of $6 million per person, or $12 million per couple, less than 50 of all those who pass away in Maryland in 2006 will have to pay any estate taxes at all.

At the same time, I stand for a patriotic pause, which means not passing any new tax cuts until our Nation has paid for the war in Iraq and our troops. The war in Iraq is costing us $2 billion each week. Where is the Iraqi oil that we were promised would help pay for this? There cannot be a change in our revenue stream until the war is over--or paid for by Iraqi oil. If I have to choose between a tax cut or body armor for our troops, I choose body armor. Our first obligation must be to our troops.

War is not the time to be repealing the estate tax. Americans are putting their lives on the line to serve in Iraq and too many are making the ultimate sacrifice for their country. Now more than ever, we cannot afford to repeal the estate tax. But we must reform it.

I am a deficit Democrat. The Federal Government has a $337 billion budget deficit. But that pales in comparison to our Nation's debt, which has risen to $8.3 trillion. It has been estimated that by 2015, each American family's share of our national debt will be $85,000. It affects us all.

I took the tough votes in 1990 and 1993 that led to a balanced budget. They led to the first budget surplus in a generation. But most importantly, those steps put the economy back on track and resulted in 8 years of prosperity enjoyed by all Americans. We created 23 million new jobs and increased wages. Inflation fell and unemployment dropped to historic lows.

Today, Congress must act responsibly. We should not be repealing the estate tax. We should be reforming it so it affects fewer people, protects our small businesses, and so we can keep our Nation strong and secure.

Mr. MCCAIN. Madam President, let me say from the outset that I do not support full repeal of the estate tax. I have consistently voted against repealing this tax because of the impact it would have on the deficit, as well as the possible chilling affect it could have on charitable giving in this country. Having said that, I do recognize the need for commonsense reform of the estate tax structure. However, due to our serious fiscal constraints, we must proceed very cautiously on this and all other federal tax and spending matters.

In his 1906 State of the Union Address, President Theodore Roosevelt proposed the creation of a Federal inheritance tax. Roosevelt explained: ``The man of great wealth owes a peculiar obligation to the State because he derives special advantages from the mere existence of government.'' Additionally, in a 1907 speech he said: ``Most great civilized countries have an income tax and an inheritance tax. In my judgement both should be part of our system of federal taxation.'' He noted, however, that such taxation should ``be aimed merely at the inheritance or transmission in their entirety of those fortunes swollen beyond all healthy limits.''

I agree with President Roosevelt, and I remain opposed to full repeal of the estate tax. I have indicated, for several years now, that I am open to considering a reasonable compromise that addresses the concerns of those on both sides of this issue. What constituted a fortune ``swollen beyond all healthy limits'' in 1907 is very different from the wealth we see today. I don't think it's unreasonable to raise the amount exempted from estate taxes in order to protect America's family farms and small businesses while maintaining the tax for huge fortunes. We need to debate this issue and come to some kind of resolution. As we all know, our colleague, Senator KYL, has worked very hard for a long time to craft an alternative to full repeal. His compromise deserves to be debated and voted on.

To his credit, the majority leader has consistently indicated that, if the Senate can secure cloture on a motion to proceed to legislation dealing with the estate tax, Senator KYL would be recognized to offer his alternative proposal as an amendment. Therefore, I am voting to invoke cloture on the motion to proceed to H.R. 8 so that we can debate and vote on the Kyl alternative. In 2001, I stated that I supported ``estate tax reform that will take into account the effect such reform will have on our robust charitable community. For this and other reasons, I support a $5 million cap with regard to the estate tax cut.'' My position remains unchanged today. Senator KYL's alternative proposal would put that $5 million cap in place. It is a good compromise and is consistent with my longstanding views on this issue.

I want to be clear. This vote should in no way be viewed as a vote in support of full repeal of the estate tax. It is not. It is simply a vote to allow debate and amendments on the issue--with one of those amendments being the alternative crafted by Senator KYL. This vote is consistent with both my longstanding opposition to full repeal of the estate tax as well as my support for a reasonable compromise. Again--I continue to oppose full repeal of the estate tax, but look forward to supporting Senator KYL's alternative proposal.

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