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   It sounds to me as if there is another side of this argument --that getting rid of this unfair, unjust, and immoral tax would actually be an economic benefit to millions of Americans and to the Federal Government, for one. With such economic growth, Federal revenues would grow higher as well. Even Washington would benefit if we could get rid of this tax . But they can't see past the blinds. They say: No, we have to continue to penalize these people; we have to continue to take their money; we dare not to do that.

   Congress can and should help working Americans keep their family assets by eliminating the damaging estate tax . I strongly urge my colleagues to vote to repeal this tax .

   In the next few weeks, the Senate will be considering other important legislation to provide meaningful tax relief for working Americans, such as marriage penalty tax relief. I believe all of these efforts are critical to help ease the tax burden on American families against the marriage penalty.

   Why do they call it a penalty? It is an unfair tax because, if a couple decides to get married, the Government wants to take more money unfairly. It is unjust. The estate tax is not different.

   I know President Clinton said one time at a news conference a couple of years back, well, it might be an unfair tax but Washington needs the money--something in that respect. I am not quoting him word for word. But that was the gist of it; that somehow Washington needed the money even though it was unfair to take it, or it wasn't the right means of extracting more money from Americans, but somehow Washington needed it. Now we need even more because Washington can do better.

   I believe all of these efforts, however, are critical. If we can get rid of the death tax and help to ease or eliminate the marriage penalty tax , it would help ease the tax burden on American families.

   I again quote these numbers. It says here that research shows the repeal of the death tax will create more than

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   I also hope in the second reconciliation legislation Congress can consider and pass tax relief for American seniors by repealing all of the taxes on their retirement benefits.

   Again, this administration and this President decided to increase taxes on the senior citizens receiving Social Security. They increased their taxes in 1993. That is another tax that I think we should repeal.

   We talk about seniors not having enough money; that they have to decide between meals and medicine. They have to do that because Washington has decided to take more of their money. We need to repeal that tax on our senior citizens as well.

   I challenge President Clinton to sign these tax relief measures into law so the American people can keep a little more of their own money for their own priorities and so they can make the decisions on how that should be done.

   Again, I strongly urge my colleagues to vote in support of repealing the estate tax --the death tax --along with these other taxes to give Americans the ability to keep a little more of their hard-earned money.

   I thank the President. I yield the floor.

   The PRESIDING OFFICER (Mr. DEWINE). The Senator from Wisconsin.

   Mr. FEINGOLD. Mr. President, as you know, this is one of those days that you actually look forward to when you are running for the Senate. I had an opportunity to be on the floor for virtually the entire debate today concerning the estate tax . It is actually a very welcome debate. But let me be clear. Democrats, as well as Republicans, welcome the opportunity to eliminate the estate tax for middle-income Americans and families who own small businesses and family farms.

   We, on this side of the aisle, believe that we can completely abolish the estate tax for the overwhelming majority of American families who this tax affects at a fraction of the cost of the Republican proposal. Why is that? It is because, unfortunately, the Republican proposal focuses so much of the revenue that is available on the superwealthy.

   When Senators give examples, as they have done today, they are often using one kind of example that the Democratic alternative would take care of, but their proposal actually spends great amounts of revenue on people who are actually not in the same position as the families which various Senators have described.

   For example, the Senator from Montana, Senator BURNS, came out and very appropriately referred to the various Wisconsin farmers, dairy farmers, hog farmers, and feed farmers. He said this was the purpose of the repeal of the estate tax . But the fact is, you don't need to completely repeal the estate tax for everyone in the United States of America in order to take care of the problem of every family farmer in Wisconsin with regard to the estate tax . In fact, most of them don't face an estate tax at all given the exemptions under current law.

   So this notion that somehow the Democrats are against taking care of the problems of farmers who are land rich and cash poor is simply untrue. It is not the Democratic position. In fact, it is just the opposite.

   Senator GRAMS of Minnesota comes out and gives the example of the family from Idaho that faces a $3.3 million tax burden on the estate tax . He fails to point out that, under the Conrad-Moynihan proposal, that family would get at least substantial estate tax relief, and, we believe, although we would have to check it, perhaps a complete exemption from the estate tax . So the very example that the Senators from the other side of the aisle have used do not support their point. Those examples would be taken care of, I believe, under the Conrad-Moynihan proposal.

   It is really a bit of a bait-and-switch approach. You come out and give the very appropriate examples of families who may need some estate tax relief, but the actual proposal spends a great deal of available revenue in this country on folks who, frankly, are not as desperately in need of this kind of relief.

   This debate is very welcome because it gives us a chance to talk about what is most important. This motion to proceed allows us an opportunity to actually contrast the majority's priorities with those of the American people. This is a thread that has gone through the comments today of many of us on our side of the aisle--Senator DORGAN of North Dakota, to Senator WELLSTONE, to Senator BOXER. They pointed out that this is a great chance to talk about what the priorities are for the American people.

   That is another thing I imagined I would have a chance to

   do when I came to the Senate. We like to deal in specific subjects and try to give a little expertise and show that we know something specific. But there are also days when we come out and, say, take this subject and that subject and compare them and see what is the most important thing for the American people. Fortunately, the debate today has allowed that opportunity.

   By moving to this bill and by trying to pass this bill the way it is written with not just sensible estate tax reform but massive tax cuts for the extremely wealthy, the majority makes clear that it favors tax cuts for the very wealthy above anything else.

   No, the majority's priorities are not those of working Americans.

   Let me begin by discussing the estate tax , and why the majority's plan to completely repeal the estate tax is wrong.

   To begin with, the estate tax affects only the wealthiest property holders. In 1997, only 42,901 estates paid the tax . That is the wealthiest 1.9 percent. People are already exempt from the tax in 98 out of 100 cases. Let me repeat that. Already, under current law, 98 out of 100 cases are completely exempt from the Federal estate tax .

   This year individual estates up to $675,000 are exempt from taxation, and each spouse in a couple can claim that $675,000 exemption. So a couple can already, under current law, effectively exempt $1.35 million from the tax . To add to that, Congress has already enacted useful expansions of the exemption that have not yet taken effect.

   By 2006, individual estates up to $1 million will be exempt and, therefore, couples will be able to exempt $2 million in tax . Had those exemptions been in effect in 1997, more than 44 percent of the estates that paid tax --remembering that most of them didn't pay tax in the first place anyway at that point--those still paying tax in 1997 would have been completely exempt.

   In 1997, Congress also raised the exemption for family farms and small businesses, the ones that the Senators on the other side of the aisle have cited needing relief. In 1997, we raised the exemption for the family farm and small businesses to $1.3 million for an individual and $2.6 million for a couple. Small businesses and farms can also exclude part of the value of real property used in their operations. Those very few businesses and farms that are still subject to tax can pay it in installments over 14 years at below market interest rates.

   In 1997, Congress went a long way toward making the estate tax less of a burden. Already in 1997, the superwealthy were paying most of the estate tax . The wealthiest 1 in 1,000 with estates larger than $5 million paid half the estate tax that year. That is why the Republican idea--and this is the Republican idea not to cut the estate tax , as they will say when they are giving their example--the Republican idea is to repeal the estate tax completely. That is tilted too heavily to the very wealthy. The Republican estate tax repeal would give the wealthiest 2,400 estates, the ones that now pay half the estate tax , an average tax cut just on the estate tax of $3.4 million each. Remember, we are talking about a situation where

   98 out of 100 people get zero, nothing, from this estate tax cut.

   Last month, Forbes magazine estimated that Mr. Bill Gates is personally worth about $60 billion. If, heaven forbid, Mr. and Mrs. Gates were to pass away and the Republican bill was fully in effect, if they otherwise would have paid the same average effective tax rate that the largest estates paid in 1997, then, believe it or not, this bill would give Bill Gates' heirs alone, just for those people in that family inheriting the money, an $8.4 billion tax break; $8.4 billion in revenue that we currently collect would go to this one family.

   Think of how hard we worked on this Senate floor in bill after bill to find

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   As I noted, 44 percent of estates that paid tax in 1997 would have been completely exempt from tax if the exemption were raised to $1 million. Fully 85 percent of the estates would have paid no tax if the exemption had been raised to $2.5 million.

   Senators CONRAD and MOYNIHAN have been working on a proposal that will eliminate the estate tax for most people for whom it would apply today, and to do so for substantially less cost than the majority's bill. I think the Democratic alternative is a good substitute. We ought to pass it. We ought to send it to the President for his signature.

   If the majority fails to adopt that reasonable amendment, however, we will have others. One of the reasons I welcome this debate is because I am looking forward to offering an amendment that will try something else, that will simply maintain the estate tax on estates of $20 million or more. We are talking about estates of $20 million. We are certainly no longer talking about upper-middle-income families. We are talking about estates of $20 million. I don't think we are talking anymore about small businesses the way most people understand that term. In 1997, there were only 329 estates in the country that amounted to more than $20 million. But those 329 estates are worth $25 billion. We are talking about estates that average $75 million each. The majority's estate tax bill gives the heirs of estates such as those 329 multimillionaire estates a tax cut that averages $10.5 million each.

   I am looking forward to this debate to see if the majority can at least keep itself from giving this massive tax cut, averaging $10.5 million each, to the wealthiest 1 in 10,000. We will see.

   The point of amendments such as these is that an estate tax for the superwealthy does, in fact, serve some important social purposes. Yes, some sensible reforms are in order to increase the exemption to the estate tax for middle-income Americans, and certainly to address the special needs of small businesses and farmers. But the majority's position is too extreme. We live in a time of an increasing concentration of wealth. Last September, the Wall Street Journal reported in 1997 the Nation's wealthiest 10 percent owned 73 percent of the Nation's net worth. That is up from 68 percent in 1983. With the stock

   market boom of the 1990s, the wealthiest have done very well, indeed.

   Those who hold this great wealth are in a better position to shoulder some of the costs of our society. An estate tax for the superwealthy makes them help out. It is ironic, just when the very wealthiest are doing as well as they have since the gilded age, the Republicans decide that the very wealthy deserve--and what we most need to do--is another tax break. An estate tax for the superwealthy also serves as a backstop to the income tax , ensuring that some income on which income tax is deferred or avoided is ultimately subject to at least some tax .

   For example, because the income tax law steps up the basis of per capita gains on the value of a piece of property at the time of inheritance, no one pays income tax on capital gains that an individual built up on property the individual owns at the time of death, and, therefore, the estate tax provides the worthwhile social purpose, I believe, that the superwealthy have to at least make up for some of that.

   I think there is a worthy point that has been debated a little bit in the last hour. An estate tax for the superwealthy does encourage charitable giving as Senator BOXER from California pointed out. A complete repeal of the estate tax would land a devastating blow on colleges, churches, museums, and other charitable institutions that rely on donors to leave gifts. The majority's repeal of the estate could well reduce charitable gifts and bequests by $6 billion annually.

   The majority bill would be immensely expensive. The Joint Committee on Taxation projects that the majority bill would cost $105 billion over 10 years. Because the bill is phased in slowly over 10 years, its cost would actually explode even more in the second 10 years. When fully phased in, the bill would cost at least $50 billion a year, or more than $500 billion a decade. In fact, the Treasury Department says the figure would be about $750 billion over the decade.

   Are tax cuts for the superwealthy the first place that we as a Nation want to spend more than half a trillion or three-quarters of a trillion dollars of the surplus?

   Yes, it is true; some of the speakers on the other side have said America's economy is still strong. The Nation is enjoying the longest economic expansion in its history. Unemployment is at lowest in three decades, and home ownership is at the highest rate on record at 67 percent.

   Several causes contributed to the current economic expansion, and it cannot be denied that a key contributor to our booming economy has been the Government's fiscal responsibility since 1993. I am very proud of that, as are many Members. The first tough vote I took was to support the President's deficit reduction plan in 1993. It worked, and it worked very well.

   This responsible fiscal policy means that the Government has borrowed less from the public than it otherwise would have, and will have paid down $300 billion in publicly-debt held by October of this year. The Government no longer crowds out private borrowers from the credit market. The Government no longer bids up the price of borrowing--that is, interest rates--to finance its huge debt.

   Because of our fiscal responsibility, interest rates are, so far, lower than they otherwise would be. Because of our fiscal responsibility, millions of American have saved money on their mortgages, car loans, and student loans. Because of our fiscal responsibility, businesses large and small have found it easier to invest and spur yet more new growth.

   Massive tax cuts like the one before us today I think pose the greatest single threat to that responsible fiscal policy, and to the strong economy to which it has contributed. It is no secret and it has been essentially admitted to by the previous speaker, the Senator from Minnesota: The majority intends to pass--in one bill after another--a massive tax cut plan reminiscent of the early 1980s.

   The majority leader said as much in a Republican radio address over the recess. After rattling off a series of tax cuts, the majority leader said, ``Put all this together and we call it `First Things First' ''

   I think it is supremely ironic that the majority leader chose to use those exact words, ``first things first,'' for in so doing, he echoed what President Clinton said in his 1998 State of the Union Address, when he said, ``What should we do with this projected surplus? I have a simple four-word answer: Save Social Security first.''

   That is, after all, what this debate is about: What should come first?

   As I and other Democrats have said, and demonstrated by our votes, we support estate tax reform for middle-income Americans, small businesses, and family farmers. But as we debate what ``first things'' should come first, shouldn't we remember our commitments to Social Security and Medicare?

   In the decade of 2011 to 2020, just as the costs of the bill before us today will begin to explode, the baby boom generation will begin to retire in numbers. Social Security's trustees project that, starting in 2015, the cost of Social Security benefits will exceed payroll tax revenues. Under the trustees' projections, this annual cash deficit will continue to grow. By 2037, the Social Security trust fund will have consumed all of its assets. Similarly, by 2025, the Medicare Hospital Insurance Trust Fund will have consumed all of its assets.

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