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Senator John J. Williams: It means $0.38 a week. Senator John J. Williams: If he gets the maximum credit Senator John J. Williams: under your proposed bill, Senator John J. Williams: $0.38 per week are

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Senator John J. Williams: enough to take him to Senator John J. Williams: the movies twice a month. Senator John J. Williams: One man, one member of Senator John J. Williams: his family can go to the movies

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Senator John J. Williams: twice a month on this tax cut Senator John J. Williams: that you're boosting so much about. Senator George A. Smathers: Well, here's... now I would rather disagree with that Senator Smathers: and say that means $20 to an individual.

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Senator Smathers: And if he has got five dependents, Senator Smathers: why it could mean maybe a $100. Senator Smathers: He can buy a washing machine, Senator John J. Williams: He can take his family and go to the movies, that's great.

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Senator Smathers: And because he buys Senator Smathers: washing machines he Senator Smathers: can put a lot of people to work in Senator Smathers: that particular industry.

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Senator Smathers: It would increase employment. Senator Smathers: It would have a lot of beneficial effects. Senator Williams: It would have some beneficial effects. Senator Williams: and I'm speaking, I'm not arguing about that,

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Senator Williams: but I'm pointing out that Senator Williams: the adverse effect of Senator Williams: a depreciating the value Senator Williams: of the dollar could offset

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Senator Williams: his ability to buy this washing machine. Dwight Cook: There's one other point, gentlemen, Dwight Cook: you haven't referred to yet. Dwight Cook: I understand the compromise measure

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Dwight Cook: would propose the addition again of Dwight Cook: certain business taxes whereby they would Dwight Cook: not be a deficit. Is that being discarded by both of you? Senator Williams: I think that that

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Senator Williams: Senator Smathers will agree with me that Senator Williams: that is not a part of it because whether we Senator Williams: accept the compromise proposal Senator Williams: or whether we accept the committee version,

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Senator Williams: those features, Senator Williams: those income producing features of Senator Williams: the compromise bill are incorporated in Senator Williams: the committee bill and are going to be

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Senator Williams: enacted into law regardless. Senator Williams: And to my knowledge, I have yet to hear Senator Williams: any man on either side of Senator Williams: the aisle express any oppositions

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Senator Williams: to those income producing features. Dwight Cook: Well, aren't there more proposed? Senator Smathers: That's right, except for two. Now of course, Senator Smathers: in both the compromise

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Senator Smathers: feature and the committee bill, Senator Smathers: the continuation of Senator Smathers: cooperation taxes at a rate of Senator Smathers: 52% is recommended as

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Senator Smathers: are the continuation of the excise taxes. Senator Smathers: But in addition, in order to Senator Smathers: be responsible and to not, Senator Smathers: and then to meet the argument that we are

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Senator Smathers: irresponsible and that we Senator Smathers: are bringing on inflation, Senator Smathers: it's proposed in the bill that, Senator Smathers: that there will be a recapture of

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Senator Smathers: some of the dividend provisions and Senator Smathers: the dividend relief which was granted Senator Smathers: last year in the bill which was passed, Senator Smathers: and also that the depreciation,

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Senator Smathers: accelerated depreciation which was Senator Smathers: provided for in the bill last year, Senator Smathers: will be again temporarily Senator Smathers: postponed and thereby

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Senator Smathers: recapture some more money. Senator Smathers: And it's argued by the Democrats Senator Smathers: that thereby this compromise proposal, Senator Smathers: while it would cost the Treasury

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Senator Smathers: some money nonetheless, Senator Smathers: that the net balance would be Senator Smathers: if we adopted all of these features, Senator Smathers: that there would be more money coming into

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Senator Smathers: the treasury than is Senator Smathers: going out in the relief proposal. Senator Williams: Well, again, that's figures Senator Williams: pulled out of the air

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Senator Williams: that cannot be supported. Senator Williams: I think you'll agree they're Senator Williams: not supported either by Senator Williams: the Joint Committee on Taxation

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Senator Williams: or by the Treasury Department. Senator Williams: Now the dividend feature... Senator Smathers: ...I find Senator Smathers: myself and just violent disagreement with my... Senator Williams: Well, now the dividend feature... Senator Smathers: because those

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Senator Smathers: figures were supplied by us. Senator Williams: Might I? Dwight Cook: Senator Williams, could Senator Smathers answer that first point Dwight Cook: then you'll finish?

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Senator Smathers: Let me say that these figures actually were Senator Smathers: supplied to us by a Colin Stamm, Senator Smathers: who is the head of Senator Smathers: the joint staff for

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Senator Smathers: the House Ways Senator Williams: Well I have those figures Senator Smathers: and Means Committee. Senator Williams: right here. Senator Smathers: And, and while he changed them three times, Senator Smathers: each time getting more conservative,

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Senator Smathers: these last figures which Senator Smathers: I have just cited, are Senator Smathers: the most conservative figures and there are Senator Smathers: many other figures who believe actually they would be even more, but...

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Senator Williams: Might I just comment on those figures? Dwight Cook: Senator Williams. Senator Williams: Because you Senator Williams: raised the question, Senator Williams: now that dividend picture,

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Senator Williams: the no argument about that. Senator Williams: There's about $400 million Senator Williams: involve the first year. Senator Williams: And that was the report

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Senator Williams: given to our committee and I think we're Senator Williams: in agreement. And that would Senator Williams: represent a savings from the Senator Williams: two point three that your

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Senator Williams: first proposal and bring it Senator Williams: down to around two billion. Senator Williams: Now as to the accelerated Senator Williams: appreciation features

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Senator Williams: that you're going to strike Senator Williams: out of the existing law. Senator Williams: Don't overlook the fact Senator Williams: that as you strike it out,

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Senator Williams: what you're proposing to restore Senator Williams: the old law. And under the old law, Senator Williams: under accelerated depreciation Senator Williams: or the amortization certificates,

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Senator Williams: your large corporations, Senator Williams: and large corporations Senator Williams: only, were getting Senator Williams: a five-year amortization program,

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Senator Williams: which was repealed under the 1954 Act. Senator Williams: And I don't think Senator Williams: that you are saving any money. Senator Williams: In fact, I think that it's more

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Senator Williams: expensive except that you're Senator Williams: taking away from the right of Senator Williams: a farmer, under Senator Williams: the existing law, to write off

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Senator Williams: and to depreciate his tractor, Senator Williams: and his combine, or his Senator Williams: barn at the same rate Senator Williams: as large industries have been able to do.

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Senator Williams: And you're saying that no, Senator Williams: you can't depreciate Senator Williams: that tractor at the rate that Senator Williams: the manufacturer can depreciate

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Senator Williams: his plant, and that you do not save any money. Senator Williams: You're merely going back and Senator Williams: taking away from the small businessman Senator Williams: and the farmer the right to

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Senator Williams: depreciate his implements at the same rate Senator Williams: the large fella did and you're going Senator Williams: back and saying to the large corporations, Senator Williams: we'll go back and give it to

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Senator Williams: you better than you got it under the existing law. Senator Smathers: You know for a Senator Smathers: fella who talks like that. Senator Smathers: I would have almost Senator Smathers: thought that you would have

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Senator Smathers: supported this depreciation proposal last year. Senator Williams: I did support it in the committee because Senator Williams: I said that it was a good feature Senator Smathers: But... Senator Williams: even though I thought it was unwise at that time. Senator Smathers: But anyway, because...

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Senator Smathers: I tried. Senator Smathers: Well I was one of those who supported Senator Smathers: last year and for many of Senator Smathers: the reason which you have enumerated.

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Senator Smathers: But on the other hand, we have learned by Senator Smathers: having this feature in Senator Smathers: our tax bill now for almost, Senator Smathers: our tax program for one year

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Senator Smathers: that actually the people that are Senator Smathers: getting the most benefit out of it are the Senator Smathers: giant corporations who are permitted to, Senator Smathers: as you know,

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Senator Smathers: take this accelerated depreciation Senator Smathers: and thereby that, Senator Smathers: that's where most of the loss to Senator Smathers: the Treasury is resulting from.

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Senator Smathers: It's not from the farmer. Senator Smathers: After all, we're trying Senator Smathers: desperately to help the farmer. Senator Smathers: We're trying desperately to help

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Senator Smathers: the small businessmen, Senator Smathers: and that's the whole purpose Senator Williams: But, might I interrupt? Senator Smathers: of this particular program. Senator Williams: The progress, Smathers

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Senator Williams: you're not doing that. Senator Williams: You are repealing the right of the farmer and the Senator Smathers: Well, that... Senator Williams: small businessman Senator Williams: to depreciate his

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Senator Williams: at this accelerated rate. Senator Smathers: Thats... Senator Williams: But you are restoring the right of Senator Williams: these major corporations to Senator Williams: go back where they can

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Senator Williams: get not eight or Senator Williams: ten percent depreciation rate, Senator Williams: but they can get twenty percent Senator Smathers: Let me... Dwight Cook : Gentlemen, you are accelerating the rate of

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Dwight Cook : the technicalities here for Dwight Cook : an average listener as you go along. Dwight Cook : Could I reduce this Dwight Cook : to an over simple question?

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Dwight Cook : Would it be a good idea to make changes in Dwight Cook : the tax laws whereby you wouldn't Dwight Cook : have any more of the deficit, Dwight Cook : but the man making

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Dwight Cook : the least amount of income would Dwight Cook : get more of a cut and Dwight Cook : businesses would get less. Senator Smathers: Well, that's exactly what

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Senator Smathers: we're proposing to do. Senator Smathers: We think that in view of Senator Smathers: what happened last year and all the Senator Smathers: tax relief that was granted because

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Senator Smathers: such a large percentage of that went to Senator Smathers: business and at that time Senator Smathers: it was deemed that was the best way to help Senator Smathers: the economy was to spur

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Senator Smathers: business investment which would bring Senator Smathers: about greater expansion of Senator Smathers: plants and thereby more jobs. Senator Smathers: But we've now seen that what we need,

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Senator Smathers: on the other hand, Senator Smathers: is a larger consumer purchasing power. Senator Smathers: And the way to do that is to help Senator Smathers: those people in the low income groups.

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Senator Smathers: And that's what this particular proposal, Senator Smathers: Democratic proposal would do. Dwight Cook : Okay, Mr. Williams? Senator Williams: Might I say to Senator Senator Williams: Smathers, my good friend here

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Senator Williams: that all that sounds very well, Senator Williams: were it not for the inconsistent record, Senator Williams: of the Democratic Party in the past. Senator Williams: As I pointed out yesterday,

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Senator Williams: when the Democratic Party took Senator Williams: control of the government in Senator Williams: 1932, personal exemptions Senator Williams: were one thousand dollars

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Senator Williams: and every married family had $2500. Senator Williams: Under your administration, your gradually Senator Williams: whittled that away to $500 in 1948. Senator Williams: It was over the veto

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Senator Williams: of the Democratic president Senator Williams: that the Republican Congress Senator Williams: raise that the $600. Senator Williams: And throughout the entire record of

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Senator Williams: our income tax laws for the past 41 years, Senator Williams: the history shows that the Senator Williams: Democratic Party has never, Senator Williams: when they were in power, raised exemptions.

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Senator Williams: They talk about it when they're out of power. Senator Williams: But the historical record Senator Williams: is that you have never Senator Williams: raised exemptions at

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Senator Williams: anytime that you were in power, Senator Williams: the historical record is that there had been Senator Williams: 15 tax increases and Senator Smathers: Yeah. Senator Williams: 13 of those took place under the Democratic party Senator Smathers: Let me just say this...

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Senator Williams: And on only two occasions Senator Williams: in the past 50 years, Senator Williams: have you ever got a record of Senator Williams: having passed a tax reduction bill.

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Senator Smathers: Let me just say this, of course Senator Smathers: he talking about an increase for the, Senator Smathers: over the past 20 years when we Senator Smathers: had three wars and obviously

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Senator Smathers: everybody voted for tax increase Senator Smathers: because we had to do it in Senator Smathers: order to be responsible. Senator Smathers: But let me just say this, I want Senator Williams: These were not attributed to wars.

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Senator Smathers: to say this. Today Senator Smathers: the administration, Senator Smathers: the Republican administration is Senator Smathers: face-to-face with an opportunity to

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Senator Smathers: help the little man by this tax proposal. Senator Smathers: If he wants to help, this is the time to Senator Smathers: prove it and they can Senator Smathers: support it if they want to.

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Senator Williams: We want to help the taxpayers Senator Williams: and we will help them if Senator Williams: the Democratic Party will only come along Senator Williams: and vote for a reduction

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Senator Williams: in these appropriations. Senator Williams: And we give to the American people Senator Williams: a bonafide tax reduction which Senator Williams: will be paid for out of

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Senator Williams: earned income and not from borrowed money. Senator Smathers: We have supported reduced appreciation Senator Smaters: and we will go further this year. Dwight Cook : Okay gentlemen Dwight Cook : One sentence from each of you. Dwight Cook : What is the Senate going to do Senator Smathers?

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Senator Smathers: It's going to be very close. Senator Smathers: It's hard to predict. Dwight Cook : [Laughs] Senator Williams? Senator Williams: I cannot help but think that Senator Williams: the Senate is going to stand by

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Senator Williams: a sound fiscal policy and defeat Senator Williams: this proposal as it has been sponsored. Dwight Cook : Thank you for your discussion, gentlemen. Male voice 1: You've been listening to

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Male voice 1: the leading question with Male voice 1: Dwight Cook and his guests Male voice 1: today, Senator George Smathers, Male voice 1: Democrat of Florida,

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Male voice 1: and Senator John Williams, Male voice 1: Republican of Delaware, Male voice 1: debated this week's leading question. Male voice 1: Should there be a tax cut?

00:09:07.880 - 00:09:14.230

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Male voice 1: Democrat of Michigan, debate Male voice 1: the president's school construction plan. Male voice 1: The Leading Question is produced by Male voice 1: Nancy Hoffman and presented by

00:09:21.200 - 00:09:28.010

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