H 5740 CONGRESSIONAL RECORD — HOUSE June 8, 1995

the Page Board on which I continue to serve

as Member Emeritus.

The Class of 1995 is a splendid and remarkable group of young Americans. They have

unfailingly distinguished themselves in

every area of their page experience. Successful and useful lives are easily predictable. I

am proud to have been a page and proud to

be a friend of the Class of 1995.

God bless you and stay in touch.

Now, with that, Mr. Speaker, that

concludes my remarks. Once again I

want to thank the pages for their service and extend every good wish to them

for their future success and for their

careers.

OFFICE OF SUPPORT AIRCRAFT

THE SHOCKING AUDIT OF THE

fThe SPEAKER pro tempore (Mr.

KIM). Under a previous order of the

House, the gentleman from Oregon [Mr.

DEFAZIO] is recognized for 5 minutes.

Mr. DEFAZIO. Today Senator GRASSLEY and I received a very important report from the U.S. General Accounting

Office. We asked for an audit of the Office of Support Aircraft of the Department of Defense, and what we received

in this audit is shocking. The Department of Defense, which is required to

keep administrative aircraft adequate

to meet the wartime needs of the United States of America, made use of 48

such aircraft during the Persian Gulf

war, maintains over 500 aircraft, 10

times what they used at the height of

the Persian Gulf war and, last year

they spent $378 million on these support aircraft.

There are some notable problems

with their use of these aircraft. There

is no centralized control. Each and

every service determines who and when

people will be eligible to use these aircraft. Frequently, one-star generals

and lower-ranking civilian officials

from the Department of Defense, instead of using their chauffeurs and

their automobiles, their limousines and

their drivers, to go to Andrews Air

Force Base to catch a jet, opt to take

a helicopter at the cost of $1,400 to

$1,600 an hour. According to the GAO,

they save between 5 and 15 minutes instead of spending $30 on a cab. They

spend $400 to $1,600 to operate a helicopter. I think it is more for their ego

than it is for any support purposes, and

that is what the General Accounting

Office has found.

We also have the fact that we are

providing now for the commander in

Korea, C-U-S-F-K, as he is called, a

four-star general, we are going to provide him with a luxury pallet. That is

something which can be inserted into a

jet aircraft as this general is required,

often, to come back to Washington,

DC, to receive orders, and the current

$350,000 luxury pallets—I think that

most Americans would like to live in a

$350,000 house, but this general does not

think that a $350,000 luxury pallet is

adequate to put in an airplane so he

can fly back in comfort to Washington,

DC. No, he needs a $750,000 pallet so

that this general can fly back and forth

to Washington, DC, in extraordinary

luxury at probably seven times the average median price of houses for most

Members of Congress, $750,000 for a luxury pallet for one general.

b 1645

It is time that the generals in the

Pentagon and the civilians in the Pentagon entered into the real world, the

world of limitations, the world where

you do not go first class-plus when you

are not on an urgent mission. And the

GAO identifies that most of these missions were not urgent missions.

In fact, they also find that not only

are these aircraft used to transport

generals, as I said, every one-star general in the Pentagon can take a helicopter and then get a private jet any

time they want. They do not have to

justify it or compare it to commercial

rates. They do not even have to compare it to first class rates with a chauffeur-driven limousine. They can just do

it, because it is there. And there are no

controls.

We not only use it indiscriminately

for Pentagon brass and for officials at

the Pentagon, we are carting around

the cadets at our academies to football

games and swim meets. We had one

football game in Hawaii. The Air Force

played the University of Hawaii. The

taxpayers of the United States of

America spent $270,000 to transport Air

Force cadets to the University of Hawaii football game. Now, is that not

wonderful?

My hometown university, the University of Oregon, went to the Rose Bowl

this year, something that only happened once in the last quarter of a century. It is our second time. Nobody

asked the State of Oregon to support

the students of the University of Oregon or the alumni of the university of

Oregon and spend hundreds of thousands of dollars to transport them.

People made their own way.

But no, not when it comes to the Air

Force Academy. Was it a particularly

important game in Hawaii? Why did we

spend $300,000 on transporting? It had

something to do the with the fact the

game was in Hawaii. They spent a total

of $2 million transporting cadets to and

from sporting events last year, many

times at the cost of $2,000 per student.

Those same students could have flown

first class and each student could have

had a chauffeur-driven limousine and

had their meals and hotels paid for, for

less than it cost to transport them, and

this does not include the cost of the

crew on the ground and other incidental costs, wear and tear on the airplane. These are only the actual operating costs of the plane.

So it is time the Pentagon came to

reality here. I have introduced with

Senator GRASSLEY legislation that

would reduce the support aircraft to

that which is needed, truly needed by

the military, 50 percent, save $200 million next year and every year thereafter.

ALTERNATIVES TO OUR CURRENT

TAX SYSTEM

The SPEAKER pro tempore. Under a

previous order of the House, the gentleman from Michigan [Mr. SMITH] is

recognized for 5 minutes.

Mr. SMITH of Michigan. Mr. Speaker, I rise to discuss the need to change

the tax system.

Mr. Speaker, James Madison, one of

the architects of the Constitution, once

warned that we must keep our laws

simple. Our freedom is in danger, he explained, when laws become so complicated that no one knows what they

mean and change so often that no one

can predict what they will be in the future.

Our Tax Code in the United States

provides an example of what happens

when we ignore Madison’s warning.

Today, thanks to the bold leadership of

Chairman BILL ARCHER, we can now

discuss fundamental changes in our

Tax Code, including even the elimination of the income tax.

As a former chairman of the Senate

Finance Committee in Michigan, I had

the opportunity to deal with several alternatives to our current tax system.

Among these alternatives was a consumption tax, a sales tax with our industrial processing exemption, and a

flat-rate income tax. I would like to

simply make a few comments about

our experience in Michigan.

Michigan is the only State in the Nation with a consumption tax. We call it

the single business tax. It has been in

effect since 1975. A couple of points

that come from this experience are,

first of all, if a consumption tax is

adopted at the national level, it must

include a deduction for capital acquisition. That is full expensing of the cost

of machinery and buildings. Michigan’s

capital acquisition deduction has been

the most successful element of our consumption task. It increases productivity and encourages business and job expansion.

Second, the tax base should be determined using a subtractive method of

calculation. Michigan uses the additive

method to get the value added, and it

has given us some problems. While it is

going to yield the same base as the

subtractive method, it has created a

great deal of confusion among businesses. The tax is viewed as our income

tax by many businesses and results in

such questions as why can not I deduct

wages? Why do I have to pay a tax even

though I do not have profit? These

types of questions would be eliminated

if the tax was calculated using the socalled subtractive method.

Third, the primary problem with a

consumption tax is that the tax is hidden in the final price of the product.

This creates a danger that the government can raise the rate without individual taxpayers being aware of it.

This is what has happened oftentimes

in Europe. However, our experience in

Michigan has been that since the business tax rate has not been increased

since 1976, it has not been a problem. In
June 8, 1995 CONGRESSIONAL RECORD — HOUSE H 5741

fact, it was recently reduced by a small

amount.

One major problem with a sales tax is

that it tends to become a turnover tax.

It is important that only the final sales

are taxed. For example, we should not

tax the sale of rubber sold to Goodyear

Tire, for example, and then tax the full

value of the tires when they are again

sold. This fundamental concept is clear

in theory, but there are numerous difficulties in actual implementation that

we have pretty much solved in our

Michigan system. The problem with

services is especially severe.

Finally, the flat rate income tax has

some important advantages. It is simple, it has the same economic effect as

the ideal consumption or sales tax, and

the taxpayer, if withholding is eliminated, will be very knowledgeable

about the rate.

There are two negatives with a flat

tax, as I see it. First, it would not

allow the repeal of the 16th amendment

and dismantling of the Internal Revenue Department, and thus special interests could again come and complicate the existing Tax Code.

Second, there are problems with the

tax treatment of U.S. exports. While

the economic effect of the Armey flat

tax is identical to a value-added tax,

GATT may preclude us from removing

a flat tax on our exports while governments using a VAT could remove the

tax on their exports.

In summary, each alternative to the

current income tax system has

strengths and weaknesses, but each

method is far superior to our current

invasive system that we have today. In

‘‘The Wealth of Nations,’’ Adam Smith

spoke against the income tax, saying

the necessary invasion of privacy to

enforce tax would be too much for citizens to bear. Today his words ring true,

and we must move forward with this

opportunity to replace the current tax

system.

previous order of the House, the genThe SPEAKER pro tempore. Under a

ftleman from Illinois [Mr. LIPINSKI] is

recognized for 5 minutes.

[Mr. LIPINSKI addressed the House.

His remarks will appear hereafter in

the Extensions of Remarks.]

previous order of the House, the genThe SPEAKER pro tempore. Under a

ftleman from California [Mr. RIGGS] is

recognized for 5 minutes.

[Mr. RIGGS addressed the House. His

remarks will appear hereafter in the

Extensions of Remarks.]

SETTING THE STAKES ON THE

BASKETBALL CHAMPIONSHIP

fThe SPEAKER pro tempore. Under a

previous order of the House, the gentlewoman from Texas [Ms. JACKSON-LEE]

is recognized for 5 minutes.

Ms. BROWN of Florida. Mr. Speaker,

I ask unanimous consent that I be recognized ahead of Ms. JACKSON-LEE for 5

minutes.

The SPEAKER pro tempore. Is there

objection to the request of the gentlewoman from Florida?

There was no objection.

Ms. BROWN of Florida. Mr. Speaker,

will Ms. JACKSON-LEE join me, and my

colleague from Orlando, Mr. MCCOLLUM

from Florida.

Mr. Speaker, I yield to the gentlewoman from Texas [Ms. JACKSON-LEE].

Ms. JACKSON-LEE. Mr. Speaker, I

thank the gentlewoman for yielding.

Mr. Speaker, I join my colleagues,

GENE GREEN and KEN BENTSEN from the

great city of Houston and the great

State of Texas in a full-throated support of defending our world champion,

yes, you might be thinking, Houston

Rockets.

To Ms. BROWN and Mr. MCCOLLUM,

who are from Florida, and their Orlando constituents, all of you have

much to be proud of in their young

Magic team, a team that promises to

be a strong NBA contender for years to

come—in the future. But I am confident that in this instance, the veterans experience of Hakeem the Dream,

Clyde the Glide, and the rest of the

tested Rocket squad, will be a decisive

advantage over the strong shoulders

and young, young legs of Shaq, Penny,

and the talented Magic lineup.

The Houston side of this friendly

wager offers a basketball signed by all

of our team, but particularly our allstar center. And our staffs, now, listen

to this, are prepared to provide the

Floridians when you lose with a delicious Texas barbecue meal. We do not

think that this will happen, that we

would have to prepared that for you,

but, however, in the good spirit of good

sportsmanship, we look forward to receiving a signed ball from Magic and,

as well, I look forward to enjoying a

delicious meal prepared by your staffs

in the true Floridian style, and I know

you know how to get a good meal

going.

So I hope you will accept this friendly wager for the Houston Rockets

World Champion to do it again.

I yield to Mr. MCCOLLUM.

Mr. MCCOLLUM. I thank you both

for yielding. I must say having Orlando

Magic, with CORRINE BROWN and I representing Orlando, we are mighty

proud of them, and we are ready to step

up to the challenge that you have just

made to us.

We understand the talent the Houston Rockets have, and we saw them

last night as they won a very, very

close game. I think, however, the closeness of that game and the excitement

of it just proves how evenly competitive these teams are. And it is our

judgment, and I am sure CORRINE

BROWN and BILL MCCOLLUM will both

agree, that when the chips are down

after the whole series is completed, our

young Magic are going to surprise your

Houston Rockets and we are going to

be able to be the ones receiving the

meal.

We are more than happy to provide a

basketball if indeed we are on the short

end of the stick, but we do not think

we are going to be. We have got Penny

Hardaway, we have got Shaq and Anderson and Scott and Shaw and Grant

and a whole list of others, Bowie and

Royal, and I could go on down the list,

Turner.

Those are players who have never

had the chance to be where they are

today, with the exception of Grant,

who was with the Bulls for a few years,

and they are hungry. And we got a feeling that they are just as hungry, and in

fact more than we are for a meal, they

are hungry for the championship.

We are looking forward to the next

few games as we meet the challenge

you have offered. We are proud in Orlando of our Orlando Magic.

For the moment I will yield back to

my colleague, CORRINE BROWN.

Ms. BROWN of Florida. Ms. JACKSONLEE, not only do we accept your challenge, I am prepared to raise it.

Ms. JACKSON-LEE. Oh, my goodness.

Ms. BROWN of Florida. Not only do

we stand by our men in Orlando, the

Magic, but we will throw in a couple of

Disney tickets and Universal Studio

tickets. And I understand we have

some of the sweetest corn in the country. We are prepared to provide sweet

corn and peanuts. And someone from

your delegation asked for an alligator.

But what we are prepared to do, is the

Houston team will be alligator bait.

Mr. MCCOLLUM. If the gentlewoman

will yield, before that, about the corn,

we have zellwood sweet corn in season

right now. If we do not make it, and we

think we will, we are going to bring

some of that up here and we are going

to serve you some of the best sweet

corn you have ever eaten.

Ms. JACKSON-LEE. My goodness, it

looks like two on one. But my colleagues who are in absentia will join

me in accepting the challenge. We have

got beets, we have got good fruit, we

have a variety of other talent going on

in our great State, along with Sam

Cassell, Kenny Smith, Mario. We have

got a whole list of those on the fine

Houston team. I do realize that all of

this that we are betting on the friendly

wager will go to charity for all of our

good efforts in our respective States.

But I tell you standing here in the

well, I am feeling embellished and

strong to accept your challenge, for the

world champion Houston Rockets will

do it again.

Ms. BROWN of Florida. We will see

you tomorrow night at 9 o’clock in Orlando.

Mr. MCCOLLUM. We will indeed. And

we look forward to seeing you in a couple of games after that too. We are sure

we are going to be around right to the

end, and we are looking forward to this

challenge.

Ms. JACKSON-LEE. Thank you. We

are all very optimistic.