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Camp Floor Statement: The Middle Class Tax Relief & Job Creation Act

December 13, 2011

There are four important facts everyone should know about The Middle Class Tax Relief & Job Creation Act:

  1. It will strengthen our economy and help get Americans back to work by lowering that tax burden for middle class families and job providers alike.
  2. It prevents massive cuts to doctors working in the Medicare program to protect America’s seniors and those with disabilities – providing more stability in the doctor payment schedule than there has been in a decade.
  3. It adopts a number of the President’s legislative initiatives, which represents the bipartisan cooperation Americans are demanding. 
  4. It is fully paid for with spending cuts, not job-killing tax hikes.  The CBO tables show the bill saves about $1 billion, and when you add in the Flood Insurance provisions, the savings are closer to $6 billion.

So, it will help families struggling in this economy, it will help the unemployed get and keep a job, it helps seniors, it is bipartisan and it is paid for.  The House should, and I expect it will, overwhelmingly pass this measure, and the Senate should quickly pass it so Americans can get what they truly want this Holiday season – something that helps create jobs while helping those most in need.

While this bill includes the priorities of a number of committees, many of the provisions in H.R. 3630 are within the purview of the Ways and Means Committee. 

This bill will extend for one-year the payroll tax holiday to help middle class families struggling in this economy, while fully protecting the Social Security Trust Funds.  Mr. Speaker, I have a letter from the Social Security Chief Actuary confirming this fact, and I ask unanimous consent that it be inserted into the record.

Without an extension, a worker earning $50,000 would see his or her take-home pay decline by $1,000 in 2012 as compared to 2011. 

Employers are helped, too.  Through an extension of 100 percent expensing, job creators down the supply chain will see more demand for their products.  This will help boost economic activity and job creation.  The President has endorsed both of these tax policies.

The bill will also extend unemployment benefits that are scheduled to expire at the end of the month, but does so while permanently reforming the program and adopting the President’s plan to wind down recent expansions of the program.

Since 2008, extensions of unemployment benefits have added $180 billion to the debt.  We are putting an end to that deficit spending.  This program is fully paid for, and it contains significant reforms, such as:

  • Allowing states to screen and test UI recipients for drug abuse, overturning a 1960s-era Department of Labor ban on doing so.
  • Requiring all unemployment recipients to (1) search for work, (2) be in a GED program if they have not finished high school, with reasonable exceptions, and (3) participate in re-employment services.
  • Implementing program integrity measures such as new data standardization to crack down on waste, fraud and abuse.
  • And, just as we did in connection with welfare reform, we are giving states the flexibility to design their own reemployment programs – similar to the sorts of programs the President has touted like Georgia Works and wage subsidies.

Why are we making these reforms instead of just passing a straight extension?  Because we know that a paycheck is better than an unemployment check.  These bipartisan reforms will help get Americans back to work while providing them with assistance during hard times.  And, that should truly be the focus of our unemployment programs – getting people back to work.

In addition to reforming UI, we extend Federal benefits but reduce the maximum number of weeks of all benefits from 99 weeks to 59 weeks in most states by mid-2012 – this reflects the more “normal” level typically available following recessions.  I should point out that phasing-out 20 of those weeks is the President’s policy.  As a result of this extension, an estimated five million out-of-work Americans will receive an average of about $7,000 in assistance they need in this tough economy.  A “no” vote today is a vote to deny those Americans, who are out of work, those benefits.

We also end UI for millionaires – the bill simply says if you earn one million dollars, you have to pay back your unemployment benefits.  Though not in the jurisdiction of Ways & Means, the bill applies a similar policy to food stamps.  Together these policies save taxpayers $20 million.

Next, the legislation prevents a 27 percent cut to doctors serving Medicare patients and replaces it with one-percent payment updates in 2012 and 2013. The 2-year update is the longest that Congress has provided since 2004, which will give us time to develop a permanent solution. 

In addition to the Medicare “doc fix,” the legislation reforms and extends temporary Medicare payment programs.  Since 2002, Congress has blindly extended as many as a dozen of these programs.  Given that we are running a trillion dollar deficit and borrowing 40 cents out of every dollar we spend, the American taxpayers simply cannot afford to have Congress skip out on doing proper oversight.

That is why we are extending only four of those provisions – and we are making reforms to some and requiring additional studies from the Centers for Medicare and Medicaid Services and the Government Accountability Office to get better data about how they are working.  

These programs are: the therapy caps exceptions process, premium assistance for low-income seniors, ambulance payment add-ons and geographic payment adjustments for physician office visits, sometimes called the GPCI or “Gyp-See.” 

In the healthcare field, the legislation also:

  • Adopts a recommendation from President Obama that reduces subsidies to high-income seniors by requiring them to pay a greater share of their Part B and D premiums.  This single change reduces spending by $31 billion in the next decade.
  • Saves $13.4 billion in wasteful overpayments of Exchange subsidies —similar to previous good-government changes enacted by overwhelming bipartisan majorities and signed into law by the President, and;
  • Repeals provisions in current law that hurt physician-owned hospitals. 

With regard to the nation’s primary welfare program, the legislation extends through September 30, 2012, Temporary Assistance for Needy Families (TANF), which is set to expire on December 31, 2011.

The TANF extension includes bipartisan, bicameral reforms to ensure that taxpayer funds are protected from abuse.  Those reforms include improvements to program integrity and closing the current “strip club loophole,” so that welfare funds cannot be accessed at ATMs in strip clubs, liquor stores and casinos.

In California alone, nearly $4 million in state-issued cash benefits was withdrawn from ATMs in casinos between January 2007 and May 2010.  Another $20,000 in benefits was withdrawn from ATMs in adult entertainment establishments.  I think we can all agree that this reform makes sense for taxpayers and for those on welfare.

Finally, the legislation takes two additional steps to better protect taxpayer dollars.  First it makes a necessary change to the Additional Child Tax Credit program by requiring the individual or at least one spouse to include a Social Security number on their tax return to claim the credit – just as you have to do when filing for the Earned Income Tax Credit.  This will reduce federal spending by $10 billion in the next decade alone.

Second, this legislation reduces Social Security overpayments by improving coordination with States and local governments, incorporating another recommendation from President Obama.  

The Middle Class Tax Relief & Job Creation Act incorporates more than a dozen proposals that the President has either offered, supported or has signed into law in one variation or another.  In fact, more than 90 percent of the bill is paid for with such policies.

The list of job-creating provisions and those that help families is almost too long to list, but let me highlight a few:

  • A bipartisan payroll tax cut for every working American that also protects Social Security.
  • A bipartisan energy project – Keystone XL – that will create more than 100,000 jobs and is supported by both employers and unions.
  • A bipartisan tax cut for small and large businesses to invest now in new machinery and equipment, grow their businesses, and create jobs.
  • Bipartisan reforms to make sense of federal regulations like boiler MACT – which will protect as many as 200,000 jobs.
  • Bipartisan health care reforms that will help ensure a strong health care industry.
  • A bipartisan push for spectrum auctions that will unleash new growth and create new jobs in the technology sector.
  • Bipartisan reforms that help Americans find work faster, instead of just giving them an unemployment check.

This list goes on and on, but, in short, this bill is about jobs, jobs, jobs – creating jobs and helping Americans find a job.  It is paid for, it is bipartisan, and it will help get our economy back on track. I strongly urge my colleagues to vote in favor of the Middle Class Tax Relief and Job Creation Act.