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Fiscally responsible AMT relief
By Rep. Stephanie Herseth Sandlin
December 14, 2007

As we head toward the final days of 2007, the House of Representatives is again considering important legislation to provide Alternative Minimum Tax (AMT) relief. I strongly support permanent reform of the AMT as well as short-term measures to protect 23 million households nationwide who could be affected next year. The AMT was designed to ensure the wealthiest in our country could not completely skirt their federal tax responsibilities, but it was never intended to impact millions of middle class families, and we need to do something about it.

Unfortunately, however, some in Congress prefer an AMT relief bill that continues an irresponsible pattern of fiscal behavior by adding another $50 billion to our national debt. Although fiscally responsible versions of AMT relief already have passed the House, they have been opposed by the White House and blocked by a minority in Congress, despite strong support for an AMT fix that is paid for. As I told 600 middle school students in Brookings earlier this month, I cannot support efforts to add another $50 billion to our national debt—debt they will inherit—merely because the President and some in Congress lack the courage to make the tough choices necessary to get our fiscal house in order.

We can no longer afford to ignore the price we pay every day for increasing the national debt. Since 2001, we have seen foreign-held debt more than double, rising from $1 trillion to $2.2 trillion by July of this year. China, for example, has upped its holdings of U.S. Treasury securities by almost 500 percent over the same time period.

As a member of the Blue Dog Coalition, I am a strong supporter of the new House pay-as-you-go rules, which require that any new spending or tax cut must be offset, or revenue neutral. I am proud that the House put these rules in place at the beginning of the year, and that every single piece of legislation that has passed the House since then has adhered to them. However, there are too many who want to violate this principle with the AMT, and simply tack on an additional $50 billion to our national debt, and let our children and grandchildren pay for it.

Too many in Congress pay mere lip service to fiscal responsibility and ignore the fundamental fact that it will require tough choices. And in this case, I question how tough the choice really is. I have made what I view as a clear choice: to close tax loopholes and tax shelters to pay for middle class tax relief. Why should Wall Street hedge fund managers be able to avoid income taxes utilizing offshore tax havens as retirement accounts, while firefighters and teachers and others in the middle-class meet their federal tax responsibilities? That was the choice presented to Congress, and I am proud of my votes to pay for AMT relief and close down tax loopholes and shelters.

So when those who oppose paying for AMT relief, thereby preferring to borrow billions more, wrongly suggest that paying for it is unnecessary or would result in massive tax increases, let’s be clear: they would prefer to protect a small few who evade paying their fair share of taxes rather than protecting 23 million families and future generations.

Our nation’s debt has skyrocketed to more than $9 trillion dollars. That works out to more than $30,000 for every man, woman and child in the United States. Today, every minute, the nation’s debt increases $948,907 - or $15,815 every second. And as we continue to borrow billions more from foreign countries like China and Saudi Arabia, we are passing that debt on to future generations.

But, the debt itself is not the end of our budget woes. As anyone who has ever borrowed money knows, it doesn’t come without a cost: interest. At $239 billion this year alone, interest on the debt is now one of the fastest growing components in the federal budget. With the amount we pay in interest alone, we could pay eight million teachers’ salaries for the year, or fill every U.S. gas tank for the next ten months.

The votes in this Congress on AMT relief give those who preach fiscal discipline the opportunity to take actions consistent with their words. I’m proud to have voted twice to fix the AMT in a fiscally responsible manner. I’m proud that the legislation I’ve supported provides tax relief for middle class families and continues the new House majority’s commitment to fiscal discipline. We’ve shown that Congress can cut taxes for millions without adding to the deficit. I’m disappointed that too many in Congress would prefer to take the easy road, and increase the debt, rather than make the tough choices necessary to set our nation back on a fiscally conservative path. If we don’t start making these choices now, we’ll face even harder choices in the future.