"Irvine, CA: Today Senator John McCain addressed the Orange County Forum and made the following remarks: Thank you for that very warm reception. It's an honor to be here with you today. I will attempt to repay your kindness with the mercy of being brief. I have been traveling around the country and talking with Americans about the two greatest challenges facing our nation: reforming our public institutions and defeating the pervasive cynicism with which many Americans view their government today.
This nation has overcome many challenges, two World Wars, a depression, a Cold War and the Civil Rights struggle. These were patriotic challenges. The war against cynicism is the new patriotic challenge for the new century. It's important not because we ought to blindly revere our government. We shouldn't. Precisely the opposite is true. Our government ought to earn our trust and respect by demonstrating its ability to serve the public good rather than its own parochial notion of the good. But our government isn't doing that today.
Too many of our fellow citizens, particularly the young, can't see beyond the veil of their cynicism and indifference to imagine themselves as part of a cause greater than their self-interest. The great unifying values of patriotism have come to be viewed by far too many of us as a sucker's game; expensive and unnecessary risks in a race of every man for himself to protect his or her self-interest. As a conservative, I believe that the job of reforming government -- of making it smaller and less removed from the people it serves -- begins with reforming our tax code. Someone once said that the question in any tax debate is not taxes or no taxes.
The question is who is going to pay the taxes and how big of a burden they must bear. It is this question -- how the tax burden should be distributed among the citizenry-- that should be at the heart of tax reform because it goes to the heart of the kind of people we think we are, and the kind of government we want to have. Ronald Reagan believed this too. He described trying to reform the tax code "a drama with heroes and villains." The heroes, he said, are the citizens across this country who are asking for tax justice. And the villains are the special interests, the "I got mine" gang. In 1986 Reagan battled the "I got mine" gang and won a great victory, not just for the cause of tax reform but for the cause of government reform. The Tax Reform Act of 1986 was a rare example of government striving to live up to its obligation to put the national interest ahead of its own, narrow interest.
While by no means perfect, tax rates for citizens were made lower and simpler, and a host of loopholes for favored special interests were tossed out. Time magazine called it a "political miracle." The New York Times called the bill "historic." And the president and his advisors allowed themselves to dream that its passage heralded a new era in American politics. An era in which the people's trust in their government was restored by politicians just this once doing the right thing. But Reagan's dream of a "second American revolution" of tax fairness and restored public trust died in its infancy. In the thirteen years since the passage of the Tax Reform Act we have squandered his legacy by reloading the tax code with new favors for favored social causes and moneyed special interests.
The result is that today our tax code is once again a bewildering 44,000-page catalogue of favors for a privileged few and a chamber of horrors for the rest of America. And so we find ourselves engaged in yet another great tax debate in Washington. The villains – the special interests -- are back with a vengeance. They've bought themselves seats at the table with campaign contributions. Meanwhile the heroes, the hard working American families who have nothing to give us but their votes, have no voice in the debate. I supported passage of this bill because I believe that the notion that the government knows better than families how to spend their money is absurd.
Americans should be able to keep much more of their hard-earned money to use and invest for themselves and their family's future. But while this bill is a victory for the cause of tax relief, it is a defeat for the cause of tax reform. It contains a tax break for companies that produce electricity from chicken waste, but no tax relief for senior citizens who have to forego some of their Social Security benefits if they must work to make ends meet. It forgoes revenue from people from other countries who fly to the US, but continues for the next six years to extract revenue from Americans who choose to get married. It reduces the excise tax on arrows used for hunting but does nothing to allow Americans to save and invest for their family's future. My problem with the tax bill is not that it's too big, but it's that the special interests get the biggest breaks and they get them right away.
All that American families get are the leftovers. Democrats and Republicans have real differences on the issues of taxes, but the reason we've come full circle from thirteen years ago in the tax reform debate cannot be found in partisan differences. Both parties have been working hard to re-clutter the tax code, and both parties share blame for larding up the current tax bill. The fact is there's an obstacle to comprehensive tax reform in Washington today that is bigger and more formidable than the opposition of a single political party. That obstacle is the way we finance our political campaigns.
For the sake of soft money -- the enormous sums of money given to both parties by just about every special interest in the country – politicians have put tax loopholes for the "I got mine gang" ahead of tax relief for working families. The result is the tax code we have today. A lumbering, incomprehensible behemoth that taxes your salary, taxes your investments, taxes your property, taxes your expenses, taxes your marriage and taxes your death. Whether its tax reform, education reform tort reform or any other of the vital reforms necessary to maintain American greatness in the new century, the sad but undeniable fact of contemporary politics is that as long as the influence of special interests dominates political campaigns, it will dominate legislation as well. Until we abolish soft money Americans will never have a government that works as hard for them as it does for the special interests.
I want to take our politics and our government back from the special interests. I want to take them back from the high-priced lobbyists, the labor unions, the trial lawyers, the corporate giants and endless other influence peddlers that grease their narrow agendas with soft money. Changing this system -- and ending the cynicism and distrust that it breeds among the American people -- is our new patriotic challenge for the new century. Last month we marked an historic first in our campaign. Senator Russ Feingold and I were able to secure a commitment from the leadership of the United States Senate to have a full debate and a straight up or down vote this fall on our proposal to curb the corrupting influence of soft money.
The Senate has never in its history had such a debate and taken such a vote before. The opponents of campaign finance reform continue to insist that the voters, particularly Republican voters, don't care about this issue. But most Americans care very much that the Lincoln bedroom has become a Motel 6 where the President of the United States serves as the bellhop. Most Republicans are outraged when our party abandons the fight to make government smaller and closer to the people it serves. And Americans are and should be outraged that they are denied tax relief because their elected leaders can't see beyond their political ambitions.
President Clinton, of course, has promised to veto the tax bill passed by Congress. This represents a squandered opportunity. Political points are being scored; headlines are being written; and careers are being made. But not much is getting done to provide the American taxpayers the relief they deserve and need. The sad fact is that after all the sound and fury of the tax debate, the President's veto assures that not one dime of tax relief for working American families this year unless we elected officials muster the courage to put the political Kabuki theater aside and agree on doing something more meaningful for America, than staking out political battle lines.
The latest reports project a nearly $3 trillion federal budget surplus over the next 10 years. About two-thirds of the projected surplus comes from Social Security payroll taxes. Our first priority must be to lock up the Social Security Trust Funds to prevent Presidential or Congressional raids to pay for so-called "emergency" spending or new big government programs. After locking up the Social Security surpluses, I would dedicate 62 percent of the remaining $1 trillion in non-Social Security surplus revenues, or about $620 billion, to shore up the Social Security Trust Funds, extending the solvency of the Social Security system until at least the middle of the next century.
The President promised to save Social Security, but he has since proposed or supported spending billions of dollars from the surplus on other government programs, depleting the funds needed to ensure retirement benefits are paid as promised. Next I would also reserve 10 percent of the non-Social Security surplus to protect the Medicare system, and use 5 percent to begin paying down our $5.6 trillion national debt. And with the remaining $230 billion in surplus revenues, plus about $300 billion raised by closing unfair corporate tax loopholes and ending unnecessary subsidies, I would provide meaningful tax relief that benefits Americans and fuels the economy. That means more than $500 billion in tax relief over 10 years, targeted toward lower- and middle-income Americans, small enterprises and families.
My plan would also expand the 15 percent tax bracket to allow as many as 17 million more Americans to pay taxes at the lowest rate. And it would do what the Senate has so far failed to do: provide much-needed incentives for saving. Restoring to every American the tax exemption for the first $200 in interest and dividend income would go a long way toward reversing the abysmal savings rate in this country. Most important, I would eliminate immediately the Social Security earnings test. This tax unfairly penalizes senior citizens who choose to, or have to, work by taking away $1 of their Social Security benefits for every $3 they earn. There is no justifiable reason to force seniors with decades of knowledge and expertise out of the workforce by imposing such a punitive tax.
I want to briefly discuss one other subject relating to taxes with you. This is not necessarily a tax CUT as much as it is a tax PROTECTION. Two years ago, I had the privilege of being the Senate sponsor of legislation championed in the House by your Congressman, Chris Cox. I'm talking about the Internet Tax Freedom Act, which imposed a three-year moratorium on taxes on all transactions conducted over the Internet. A three-year moratorium on Internet taxes is a good start, but it's just a start. I want to expand the Internet Tax Freedom Act into a permanent ban against using the Internet as a cash cow with which to grow government. This was the original goal, and I intend to work to make sure that goal is achieved. Internet commerce has helped fuel one of the strongest economic expansions in history.
One of the primary reasons that e-commerce has grown at such a tremendous rate is that the government has not been able to slow it down by saddling Internet transactions with additional, onerous and unnecessary taxes. Politicians at every level of government see in the Internet a bonanza. If I am elected President, I pledge to you that I'll make sure that the internet will remain a haven free of special taxes. And as e-commerce continues to grow, so too will the tax relief of the Internet Tax Freedom Act.
This is tax reform that will continue to grow, year after year, allowing consumers from all fifty states and around the world to use their hard-earned dollars to become part of a global marketplace. As our society prepares to enter the next millennium, that's the kind of tax reform we need. This is tax reform that benefits the working man and woman, the small business owner and the entrepreneur, not the special interests who flood Washington with their big-dollar contributions. This is tax reform that will encourage economic growth, not porkbarrel projects for the highest bidder. We are blessed to be Americans, not just in times of prosperity, but at all times. We are a part of something noble; a great experiment to prove to the world that democracy is not only the most effective form of government, but the only moral government. And, at least in years past, we felt more than lucky to be Americans.
We felt proud. But, today, we confront a very serious challenge to our political system, as dangerous in its way as war and depression have been in the past. And it will take the best efforts of every public- spirited American to defeat it. This country has survived many difficult challenges: a civil war, world war, depression, the civil rights struggle, a cold war. All were just causes. They were good fights. They were patriotic challenges. Now, we have a new patriotic challenge for a new century: declaring war on the cynicism that threatens our public institutions, our culture, and, ultimately, our private happiness. It is a great and just cause, worthy of our best service.
Thank you for listening."