To fully fund the No Child Left Behind Act for fiscal year 2005 and lower the national debt by closing tax loopholes.

CONGRESSIONAL BUDGET FOR THE UNITED STATES GOVERNMENT FOR FISCAL YEAR
2005

The ACTING PRESIDENT pro tempore. Under of the previous order, the
Senate will resume consideration of S. Con. Res. 95, which the clerk
will report.
The legislative clerk read as follows:

A concurrent resolution (S. Con. Res. 95) setting forth the
congressional budget for the United States Government for
fiscal year 2005 and including the appropriate budgetary
levels for fiscal years 2006 through 2009.

The ACTING PRESIDENT pro tempore. Under the previous order, the
Senator from Nevada, Mr. Ensign, is to be recognized for up to 30
minutes.
The majority leader is recognized.
Mr. FRIST. Mr. President, I have a short statement I will give, and I
assume the Democratic leader will have a statement. Following that, I
ask unanimous consent that the Senator from Nevada be recognized.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
The majority leader is recognized.
Mr. FRIST. Mr. President, I want to open by congratulating the
chairman of the Senate Budget Committee and ranking member and all
committee members for the outstanding work they have done in bringing
this resolution to the floor in a very timely manner. It was a little
over a month ago that the President of the United States transmitted
his proposed budget to the Congress, and the Budget Committee, under
real time constraints, was able to hold hearings and debate, mark up,
and report its own congressional budget plan and bring it to the floor
last Thursday evening.
My experience with budget resolutions on the Senate floor tells me
that

[[Page S2466]]

it will become very hectic, really beginning today and tomorrow and the
next day--over the next 3 days. There is a limited amount of time, as
we all know. There are 27 hours remaining for debate on that resolution
as of this morning. That time will end up passing very quickly,
particularly when we have a recess sitting on the other end awaiting
completion of this resolution.
As I mentioned earlier, we will complete this budget resolution this
week before the recess. Since we have a limited time, I want to right
upfront pay tribute to Chairman Nickles and one other Senator this
morning.
Chairman Nickles, as we all know, will be leaving the Senate at the
end of his fourth term. After 2 years as chairman of the Budget
Committee, this will be the last Federal budget he will manage on the
Senate floor. Last year, with his first budget resolution as chairman,
we were able to complete a budget resolution in record time. Eighty
amendments were offered last year and were all considered on the floor.
That was the third highest ever considered on the budget resolution in
history. In 1998, there were 106 amendments. Last year was the third
highest.

I have had the opportunity to serve on the Budget Committee in the
past and I know it is a very difficult assignment; it is a demanding
committee. But I believe the ranking member would agree with me, while
the ranking member and the chairman have not always agreed on policy,
Senator Nickles has maintained a fair and open and collegial committee
on which to work.
Six years before Senator Nickles was first elected to the Senate, in
December 1974, Sam Ervin, the distinguished chairman of the Committee
on Governmental Operations, wrote:

I have no doubt that the Congressional Budget and
Impoundment Control Act of 1974 will stand as a monument to
the 93rd Congress and its devotion to our constitutional
system of Government.

This is the 30th anniversary of the enactment of the historic
legislation which established the Senate Budget Committee, established
the Congressional Budget Office, and established the procedures that we
are involved in today in considering a congressional budget resolution.
Many did not expect that what at the time was a completely new
process to survive. Indeed, it has survived over the last 30 years. In
a way, over those 30 years, it certainly had its bumps and bruises.
Just down the road from Senator Ervin's home, one Senator, and only one
Senator in this Chamber today, has served on the Budget Committee from
its very beginning, and that is Senator Fritz Hollings. He has been
there from the very beginning. For 2 years, in 1979 and 1980, Senator
Hollings--and this was when Ed Muskie left the Senate to serve as
Secretary of State under President Carter--also served as its chairman.
Just a little bit of budget trivia: As I was looking through the
history, the first reconciliation bill was, indeed, crafted under
Chairman Hollings' leadership in 1980.
Senator Hollings was instrumental in the first major reforms to the
Federal budget process, being one of the authors, along with Senators
Gramm and Rudman, of the Balanced Budget and Emergency Deficit Control
Act of 1985, more familiarly known as Gramm-Rudman-Hollings.
I mention Senator Hollings in part because of this long history, and
I discussed some of it with him last night at dinner. As we all know,
he too will be voluntarily leaving the Senate at the end of this
Congress. So this is his last budget resolution debate on the Senate
floor, and just like the 30 debates before, I am sure he will not
disappoint the Senate with his contribution to this debate over the
next 3 days.
We have begun deliberating a blueprint for next year's Federal
budget, and that is exactly what it is; it is truly a blueprint. For
those who may be observing these proceedings for the first time, it may
appear we are passing laws on spending for our national defense,
education, or health programs, or it may appear we are enacting tax
legislation, but we are not. Listening to the debate it may sound like
it but that is not what we are doing.
It is really not unlike a family sitting around the kitchen table at
the beginning of a new year discussing and estimating how much income
they will have over the course of the next 12 months, how that income
will be spent and how it should be allocated to the basic needs,
whether it is to their shelter, food, or health care, and then how much
they should save for their children's needs. It might be for schooling
or it might be for their own retirement.
That is exactly what we are doing, or it is very similar to what we
are doing, over the course of this week in this 50 hours of debate when
we are adopting a congressional budget plan.
Just like that family sitting around the kitchen table, we are going
to have differences and those differences are going to be expressed.
There will be strong opinions on how our income should be divided among
what people project as demands that will come and demands that we have
today. Once we come to an agreement on a budget plan, which we will in
the next 3 days, just like that family, we will be tasked to implement
it by passing the revenue and spending totals that are assumed in that
blueprint.
We will also be asked to stick to it throughout the year, and so we
will be putting up some roadblocks and some warning signals in our
budget plan to remind us if we get off track or if we begin to go
astray. Indeed, that is the importance of passing this budget
resolution.
There are differences, just like sitting around that table in a
family, when planning a budget. As we have heard over the last several
days, and we will hear for the next 3 days, there will be debate and an
amendment process. The big difference between what goes on here and
what goes on with that family is size, the obvious one. Another
difference is that what we plan here can have a direct impact on that
family sitting around that kitchen table.
Will we keep that family's taxes from increasing next January by
planning our budget here to prevent that child tax credit, now $1,000,
from falling to $700 per child, thus taking $300 per child away from
that family?
Will we plan to keep the 10-percent rate bracket from dropping next
January from $4,300 to $12,000 as a threshold for joint filers?
Will we plan to prevent the standard deduction for that married
couple, and this is known as the marriage penalty tax, from dropping
next January and thereby continuing to penalize them simply because
they are married?
All of these, which we are talking about in the resolution, will keep
families from having to pay more beginning January. In fact, these
three tax items alone could mean the difference of over $13 billion in
additional take-home pay next year for nearly 38 million hard-working
families. Add that up and it becomes over $100 billion in additional
income to those families sitting around those kitchen tables over the
next 5 years. So what we plan for in our own Federal budget can and
will impact the budgets of millions of America's families in a very
direct way.
This is a challenging budget year. We are all aware it is a political
year, with the Presidential election this November, and thus reaching
real consensus on a budget will be difficult under the best of
circumstances, let alone in this Presidential election year.
The deficits we currently face are unacceptable. The budget crafted
by the committee puts a priority on reducing them. We understand why
the deficits are there: recession and war on terror. Through this
budget plan we will cut those deficits in half over the next 3 years.
At the same time, the budget blueprint that we debate from the
committee remains committed to certain priorities. The budget blueprint
assumes spending for our national security will increase over $20
billion next year. That is an increase of about 5.1 percent. It assumes
funding for domestic, or our homeland security, will increase by 15
percent. Both of these increases are essential in our war on terrorism.
Important domestic programs are not ignored. We all know a key to job
growth in the future is one that gives a high priority to education, to
retraining, to learning in schools, the basics of mathematics, writing,
and verbal skills.
Chairman Greenspan recently testified:

By far the greatest contribution during the past century to
our average annual real GDP

[[Page S2467]]

increase of 3\1/4\ percent has been the ideas embodied in
both our human and physical capital. Technological advance is
continually altering the shape, nature and complexity of our
economic processes.

Yes, education has always been, and will continue to be, the key to
our country's economic future, and the blueprint assumes we will
increase funding for disadvantaged children for title I grants to local
education agencies by over 8 percent, up over $1 billion next year,
bringing the total Federal funding for this program to $4.6 billion.
This program is the single largest Federal funding source for the No
Child Left Behind legislation.
The resolution also makes room for increased funding for special
education, or the Individuals with Disabilities Education Act. This
increased funding for special education assumes to go up by $1 billion,
and that is the fourth consecutive year of $1 billion increases,
bringing funding for this special education program next year to over
$11.1 billion.
The resolution allows for a 5-percent increase in veterans medical
care funding, up $1.4 billion, to a total of nearly $30 billion for
these important programs next year.
The resolution also assumes moneys for critical international
assistance programs, a 13.5-percent increase in discretionary funding
in this area, including last year's newly authorized Millennium
Challenge Corporation. Full funding for the HIV/AIDS initiative of $2.8
billion next year is assumed in the blueprint, putting us on the path
to meet our goal of $15 billion over 5 years.
In closing, these are a few of the priorities embodied in this
blueprint. It does not please everyone. How could it? There is no
guarantee that all of the assumptions in the blueprint will be
fulfilled as we move on to the funding legislation that will implement
this blueprint.
The demands are great. The resources at this point in time are
limited. Just like a family making difficult and unpopular challenging
decisions, we, too, will not be able to provide all of the funds some
think are needed for particular programs or needed projects. I believe
it is a solid, strong budget plan, presented to us by the chairman and
the committee and it is one that deserves our strong support.
The ACTING PRESIDENT pro tempore. The Democratic leader.
Mr. DASCHLE. Mr. President, last Friday we were presented with the
latest report on the creation of new jobs in our economy. The
administration predicted about 200,000. In February, unfortunately, we
only created 21,000--180,000 short of what the administration
predicted. If you don't count the increases in Government payroll,
there was actually no job growth whatsoever in the entire year of 2003.
Unfortunately, that could also be said of 2002, and 2001.
The administration's economic forecasts appear to be little more than
wishful thinking. A chart appeared in the New York Times yesterday that
lays out very graphically how inaccurate the job predictions have been.
In his column yesterday, Paul Krugman wrote about this unfortunate
miscalculation in the prediction of jobs. His most graphic illustration
of this miscalculation is entitled ``Promises, Promises.'' It is a
chart. It is easy to understand.
The administration predicted in 2002 the creation of 138 million
jobs. Then in 2003 they corrected that prediction. They said it isn't
going to be 138 million; it will be 135 million. In 2004, they said it
isn't going to be 138 million, it isn't going to be 135 million, now
it's going to be 132 million. Now we find out, in 2004, it wasn't 138,
135, or 132 million; it was 130 million jobs, which means they were 8
million jobs off the mark in predicting where the non-farm payroll
employment rolls would be during the course of their term in office.
From the very first days in office, the Bush economic team has failed
to understand what it takes to create jobs. I might say, as we look at
the job creation, this is American job creation. Unfortunately, I fear,
while we don't have any numbers, the outsourcing job creation probably
does exceed the prediction. I wouldn't be surprised if, under the watch
of President Bush, we have actually seen more than 8 million jobs
created. The problem is, most of them have been in India and China, and
countries in south Asia. It is American jobs we are gauging here, and
it was a prediction that it was American jobs that would be created at
that 138 million level.
We know how to create jobs, but for some reason this administration
has not been willing to commit, in policy or in resources, the effort
that must be made to ensure those jobs are created. We had the most
recent illustration of that a couple of weeks ago. The transportation
bill the Senate has now voted on, on an overwhelmingly bipartisan
basis, we are now told would create 1.7 million jobs in 6 years. South
Dakota would see over 5,000 jobs created; California, 87,000 jobs
created; Texas, 60,000; New York, 61,000; Virginia, DC and Maryland,
45,000 jobs. Thirty percent of our roads and bridges are in a state of
severe disrepair and those jobs would go to dealing with the incredible
problem we have with infrastructure deconstruction.
I think the broad support, 76-21, in the Senate marked yet another
statement about our appreciation of the magnitude, the importance of
that bill; yet what the administration has done in response to our
passage of that bill is to say they would veto it today, veto it
because they say we cannot afford it. We just talked yesterday about
the fact we are spending $27 billion this year to provide those who are
making incomes of more than $1 million a tax break. We can afford to
give millionaires a tax break of $27 billion, but we can't afford the
commitment this country must make in infrastructure.

Ironically, that is about the difference between where the Senate is
and where the administration wants to go with regard to highway
construction funds. They would rather spend it on millionaires. Many of
us feel very strongly it is important to spend it where we can create
jobs--not jobs in India, not jobs in China, but jobs here at home,
trying to meet that target the administration said was so important,
138 million. They are right. It is important. We need to create those
jobs. But we are not going to do it with the policies that have so far
been articulated by this administration.
Later today, Senator Boxer will be offering an amendment that will
create jobs beyond those we now know could be created in the highway
bill. We are going to allow for an amendment that would discourage the
flow of jobs overseas and give assistance to workers whose jobs have
been actually eliminated in the Bush economy. It would offer tax
credits to companies that create manufacturing jobs by making it more
affordable for small businesses to offer coverage to their employees.
It would discourage the exporting of American jobs by eliminating the
tax advantages for companies that take their plants overseas, and by
prohibiting the Federal Government from dealing with contractors who
outsource the work of their Government contracts to workers overseas.
It would also help workers who are dislocated by global economic forces
by including service workers in the Trade Adjustment Assistance Program
and by extending health care coverage to trade-dislocated workers.
Most of us believe families should not have to lose their health
coverage because of economic forces beyond their control. The amendment
we will be offering today says, while they are still trying to get back
on their feet, they must have the opportunity to access health care in
some form.
Since the administration has come to office, its economic policy has
been to borrow money from foreign bankers, hand it over to the
wealthiest people in the country, and hope for the best. The result is
a $9 trillion meltdown of our fiscal position and now the loss of 3
million jobs.
We need a new direction. Yesterday in the Washington Post the poll
suggested 57 percent of the American people shared that view. We have
come to a point where we must take a different direction. Economists
are worried if jobs are not created soon, Americans could lose
confidence and spur an even steeper downturn in the economy.
We know how to create jobs. Let's pass the highway bill. Let's pass
the Boxer Democratic amendment today. Let's ensure we send the right
message about the direction we want this country to take. We can do
that with this budget resolution and with legislation that has come
before the Senate. I hope, on a bipartisan basis, we can send that
message to the American people.

[[Page S2468]]

I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Nevada is
recognized for up to 30 minutes under the previous order.
Mr. ENSIGN. Mr. President, this morning I rise to speak about the
national defense function of this budget resolution. The resolution
provides $413.9 billion in discretionary spending for our national
defense. This amount represents a increase of almost $20 billion, 5
percent above the 2004 level.
As chairman of the Readiness and Management Support Subcommittee of
the Armed Services Committee, I am keenly aware that today we are a
nation at war. Almost 200,000 U.S. military service personnel are
currently deployed around the world in Operation Iraqi Freedom,
Operation Enduring Freedom, and other military operations in the
ongoing global war on terrorism.
Our soldiers, sailors, airmen and marines remain deployed in Korea,
the Balkans, at sea and elsewhere, protecting American interests and
deterring aggression.
There can be no disagreement on the magnificent manner which our
Armed Forces have answered their nation's call. Their professionalism
and performance have been brilliant, and their willingness to sacrifice
for this country is inspiring.
That is why I am so troubled today by the Democrats' response to
President Bush's weekly radio address last Saturday. That response was
delivered by Senator John Kerry, their party's presumptive Presidential
nominee.

We all know that each Senator has a right to state their opinion on
defense issues. However, when a Senator, or in this case, a party's
presumptive nominee, makes an argument built on a foundation of facts
as distorted as Senator Kerry's was, then the argument becomes more
than an honest disagreement.
He quoted the Secretary of the Army as saying that U.S. forces were
``not prepared'' for the present conflict in Iraq.
This is the exact quote:

The Secretary of the Army admitted that the United States
forces were ``not prepared'' for the present conflict.

But yesterday at the Senate Armed Services Readiness Subcommittee
hearing, the Vice Chief of Staff of the Army, General Casey, testified
that comment ``was taken out of context.'' He stated ``we were very
well prepared, all of the services.''
General Moseley, Vice Chief of Staff of the Air Force, said, ``I
would have to tell you that . . . all airmen, whether they were Navy,
Marine, or Air Force, were exceptionally well prepared. . . . and I
would take issue with anyone that criticized our magnificent airmen.''
General Huly, Deputy Commandant of the Marine Corps, said, ``I
believe we were very well prepared . . . I think that's evidenced by
the fact that we exceeded our expectations, accomplished the mission in
a shorter period of time, with far fewer losses than we even
anticipated ourselves.
Senator Kerry has woven a picture of incompetence and malfeasance by
our military leaders and our President. Nothing could be further from
the truth. It is amazing the different pictures painted by those who
have been there, and those who have not.
I personally visited Iraq last December. As a matter of fact, I was
privileged to have been in the country the day the Third Infantry
Division captured Saddam Hussein. I have to tell you what impressed me
the most was watching our troops go above and beyond the call of duty;
painting schools, rehabbing hospitals, and winning over the hearts and
minds of the Iraqi people, even in the Tikrit region where their safety
was most at risk.
Watching events in Iraq unfold underscores that America is blessed
with more than her fair share of heroes. These men and women are doing
what needs to be done in an extremely hostile environment. And they are
depending on this Congress to pass a budget that gives them the
resources to complete their mission and return home safely to their
families. This budget ensures that the military has the resources it
needs to remain properly prepared and adequately equipped.
In his radio address, Senator Kerry also stated that: ``I will never
send our troops into harm's way without enough firepower and support.''
Strong words, but words alone offer little in this context and in the
overall context of our budget discussions. It is interesting to note
that while Senator Kerry claims to be a devout supporter of our troops,
he was one of only 12 Senators who voted ``no'' for an Iraqi
supplemental that provided that very ``firepower'' and ``support'' he
now claims is so necessary.
The Iraqi supplemental was used to purchase the same body armor and
``up-armored Humvees'' Senator Kerry rails about as being insufficient.
If we had allowed Senator Kerry to make the decision, our troops would
indeed be ill prepared.
Votes have consequences. By voting against the Iraqi supplemental
Senator Kerry voted to undermine the troops in the field and that is
not only inexcusable, it is reprehensible. I hope no Senator would make
such an egregious mistake with respect to the current budget
resolution.
Therefore, I am calling upon Senator Kerry to retract his comments
about our military being unprepared and to apologize to the men and
women of our armed forces for using their sacrifices as political
fodder. It is important to remember that in a democracy there will
always be honest differences of opinion over the difficult decisions
about the best way to fund, train, and equip American forces who are
being sent into harms' way. I appreciate the opportunity to work with
Members on both sides of the aisle to resolve these differences.
On February 24, Senator Levin, ranking member of the Armed Services
Committee, sent a letter to Chairman Nickles and Senator Conrad.
In his letter he stated that ``no one can predict with precision what
these fiscal year 2005 costs will be'' and recommended an increase in
``budget authority for the national defense function by $30 billion in
fiscal year 2005.''
I agree with my distinguished colleague from Michigan when he said
that this is ``the responsible thing to do for our troops and for
budget accuracy.''
This budget takes Senator Levin's suggestions to heart and includes
the supplemental resources necessary to provide for the 200,000 men and
women in our military who are currently serving abroad.
I look forward to working with my Senate colleagues to ensure that we
adequately address the sacrifices of our men and women in uniform, by
passing a budget resolution that provides the resources that will
sustain and improve our military as they fight for security of this
great Nation. By fully supporting this budget, we will send a clear
message of support to our troops, worldwide, and an important message
to the world of America's complete commitment to freedom and security.
I yield the floor.
The PRESIDING OFFICER (Mr. GRAHAM of South Carolina). The Senator
from North Dakota.
Mr. CONRAD. Mr. President, I ask unanimous consent for 5 minutes
before Senator Murray begins her remarks.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. CONRAD. Mr. President, I don't know precisely what Senator Kerry
was referring to in his remarks the other day. But I think we all know
there were deficiencies in terms of resources provided to our troops
going into Iraq and Afghanistan. We have all read the stories
repeatedly of soldiers not having the body armor they needed. We have
all heard of people actually raising money back home in order to get
the body armor for our soldiers in Iraq and Afghanistan. That should
not be. We shouldn't have a circumstance where American soldiers don't
have the best equipment to keep them safe when we have sent them into
harm's way. I think we have all read the stories of our Humvees not
being properly armored to protect soldiers against these bombs that
have been going off.
I remember very well going to Walter Reed Army Hospital visiting
young men who had been badly injured in Iraq. I remember very well
visiting with one young soldier who had been in a Humvee that had not
been properly armored. One of the roadside bombs had gone off, and that
young soldier was terribly injured--blind in one eye,

[[Page S2469]]

lost a leg, an arm. He was badly wounded. As he lay in that bed,
another Senator and I visited him. As we left the room, having visited
that patient, we commented about how it can be that we send into Iraq
Humvees not properly armored against the kind of truck bombs and
roadside bombs that had been used to injure and kill our troops.
I don't know precisely what Senator Kerry was referring to in that
speech. We all know there were serious deficiencies in terms of body
armor for our troops and in terms of Humvees being properly armored
against bombs.
I think Senator Kerry was certainly not out of line in suggesting
that more could have been done to have our troops fully protected on
the battlefield.
I thank the Chair, and I thank especially my colleague from
Washington, Senator Murray, who is such a valuable member of the Senate
Budget Committee for permitting me to speak ahead of her.
The PRESIDING OFFICER. Under the previous order, the Senator from
Washington is recognized to offer an amendment.

Amendment No. 2719

Mrs. MURRAY. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Washington [Mrs. Murray], for herself, Mr.
Kennedy, Mr. Lieberman, Ms. Mikulski, Mr. Corzine, Mr. Levin,
Mr. Dodd, Ms. Stabenow, Mrs. Clinton, Mr. Kerry, Mr. Harkin,
Mr. Schumer, Mr. Pryor, Mr. Reed, Mr. Dayton, Mr. Kohl, and
Ms. Landrieu, proposes an amendment numbered 2719.

Mrs. MURRAY. Mr. President, I ask unanimous consent that reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

On page 3, line 9, increase the amount by $516,000,000.
On page 3, line 10, increase the amount by $13,244,000,000.
On page 3, line 11, increase the amount by $2,924,000,000.
On page 3, line 12, increase the amount by $516,000,000.
On page 3, line 17, increase the amount by $516,000,000.
On page 3, line 18, increase the amount by $13,244,000,000.
On page 3, line 19, increase the amount by $2,924,000,000.
On page 3, line 20, increase the amount by $516,000,000.
On page 4, line 20, increase the amount by $516,000,000.
On page 4, line 21, increase the amount by $13,244,000,000.
On page 4, line 22, increase the amount by $2,924,000,000.
On page 4, line 23, increase the amount by $516,000,000.
On page 5, line 3, decrease the amount by $516,000,000.
On page 5, line 4, decrease the amount by $13,760,000,000.
On page 5, line 5, decrease the amount by $16,684,000,000.
On page 5, line 6, decrease the amount by $17,200,000,000.
On page 5, line 7, decrease the amount by $17,200,000,000.
On page 5, line 11, decrease the amount by $516,000,000.
On page 5, line 12, decrease the amount by $13,760,000,000.
On page 5, line 13, decrease the amount by $16,684,000,000.
On page 5, line 14, decrease the amount by $17,200,000,000.
On page 5, line 15, decrease the amount by $17,200,000,000.
At the end of Title III, insert the following:

SEC.  . RESERVE FUND FOR NO CHILD LEFT BEHIND ACT EDUCATION
PROGRAMS.

The Chairman of the Committee on the Budget of the Senate
shall revise the aggregates, functional totals, allocations
to the Committee on Appropriations of the Senate,
discretionary spending limits, and other appropriate levels
and limits in this resolution by up to $8,600,000,000 in
budget authority for fiscal year 2005, and by the amount of
outlays flowing therefrom in 2005 and subsequent years, for a
bill, joint resolution, motion, amendment, or conference
report that provides additional fiscal year 2005
discretionary appropriations, in excess of levels provided in
this resolution, for Department of Education programs in the
No Child Left Behind Act (P.L. 107-110).

Mrs. MURRAY. Mr. President, I ask unanimous consent that the
following Senators be added as cosponsors: Senators Kennedy, Lieberman,
Mikulski, Corzine, Levin, Dodd, Stabenow, Clinton, Kerry, Harkin,
Schumer, Pryor, Reed of Rhode Island, Kohl, Dayton, and Landrieu.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mrs. MURRAY. Mr. President, parents, teachers, and students
throughout Washington State and across our entire country are looking
for our help today as they try to implement the No Child Left Behind
Act.
Unfortunately, the budget before the Senate by the Republicans falls
$8.6 billion short of what our schools and our students need this year.
It is yet another broken promise to our schools, our students, and our
families.
We can do better. That is why I am offering this amendment this
morning. I have visited schools in every corner of my State and I know
firsthand that our educators everywhere are working harder than ever to
help their students to meet these new accountable requirements. They
want to do a good job. They want to do what is right. I also know it is
not fair for the Federal Government to leave our schools without the
funding they need to meet these Federal mandates we place on them.
Today our State and local budgets everywhere are stretched thin. Our
local communities cannot afford to make up the difference between what
our schools were promised and what this budget actually provides. That
is why I am offering this amendment today to fully fund the No Child
Left Behind Act. My amendment tells students, teachers, and parents
that the Federal Government will be a full partner with our local
schools as they carry out the new law we passed.
I am not asking for some unheard of amount of funding. I am simply
asking we provide the funding we promised our schools 2 years ago. As
everyone knows, the No Child Left Behind Act increased accountability
for schools so we can ensure that all of our children will receive a
high-quality education. However, accountability is a two-way street. We
cannot demand that schools follow all of these new mandates and look
the other way when it is time to write a check. If we expect our
schools to uphold their part of the bargain, then we have to do our
part and fund these requirements.
Let's not forget, the funding levels in the No Child Left Behind Act
were based on a bipartisan agreement on what it would take to implement
this new law. It is hard to believe we are here 2 years later and the
Federal Government is still not doing its part.
This is especially important today because States are now confronting
the true cost of implementing this law. The only study that looked at
the actual cost to the States of the No Child Left Behind Act was
conducted in Ohio. That analysis estimates that the cost to Ohio of
complying with the law will reach $1.447 billion annually by fiscal
year 2010.
Again, the President's budget request and this Republican budget fail
to live up to the promises we made in this Senate just 2 years ago when
we passed No Child Left Behind. That is why we need to pass this
amendment today. This amendment adds $8.6 billion to function 500 to
fully fund the No Child Left Behind Act and to improve overall funding
for educational programs.
I am sure we will hear those on the other side saying their budget
increases funding for No Child Left Behind by $1.2 billion over last
year. It does. But it is still $8.6 billion short of what our schools
need. That shortfall is going to have real and painful effects on all
of our students unless we fix this budget.
Mr. President, 4.6 million low-income children in this country will
not get the help they need under title I unless we pass this amendment.
In my home State alone, the difference between the President's request
and the promise of No Child Left Behind means 28,000 low-income
students will be left behind.
This budget will result in fewer students being served by a number of
important programs. That is because the Republican budget freezes
funding for programs but those freezes mean real cuts in service when
you factor in that we have rising enrollment and costs to our schools.
At the end of the day, the Republican budget will mean that fewer
students will be served in impact aid, dropout prevention, school
counseling, afterschool, teacher quality, migrant education, and rural
education.

Let me give one example of what those cuts mean for our students.
This budget will leave nearly 20,000 children in Washington State alone
and 1.4 million children nationwide without a safe, adult-supervised
environment

[[Page S2470]]

after school. We can do better. My amendment shows how.
My amendment will live up to the commitments we made to our students
when the No Child Left Behind Act was passed. It fully funds programs
such as title I, English language acquisition, afterschool, and rural
education. If this amendment passes, more than 2 million additional
needy children will be served by title I, as we promised, when we
passed No Child Left Behind.
My amendment will mean more than 38,000 children in Washington State
and 1.4 million students nationwide will have access to safe, adult-
supervised afterschool programs.
My amendment is also fiscally responsible because it also asks for
$8.6 billion in deficit reduction, something many of our colleagues
have talked about.
Our priority should be educating our students. This amendment
reflects that priority because both the education increase and deficit
funding reduction are taken by closing tax loopholes. During the debate
on my amendment, I suspect we will hear a whole list of reasons why we
cannot give our kids the funding we promised them. I want to debunk
some of those plans right now.
We will hear some argue that we have already increased funding for
education to a high enough level. I say to any one of my colleagues, go
to your local schools in your communities and ask them if they agree
with that. See what type of reaction you get. Let's remember, we have
never fully funded the No Child Left Behind Act--never. How can we ask
our schools today to comply with the law when we are not holding up our
end of the bargain?
Let's not forget that the only reason we have reached this level of
funding is because many in Congress pushed and pushed last year to do
better than the President's budget. If we had accepted the President's
funding request, there would be at least $10.7 billion less for
education than was appropriated by Congress and $6.6 billion less for
No Child Left Behind.
Another claim we will hear during this debate is that if my amendment
is accepted, we will come back and ask for more funding next year. That
is exactly what the law called for when we passed it. The requirements
on our schools ratchet up throughout the lifetime of this bill,
including requirements to increase test scores and to have an increased
number of highly qualified teachers that we require under the law. That
is why the funding in the bill was slated to increase annually as well
and why we are now falling further and further behind as we fail to
live up to that commitment. That is why we are hearing from our
teachers in our schools today. As parts of this law become implemented,
they have to live up to them.
If my amendment is accepted, the request for fiscal year 2006 will
not have to play catchup again as we have done for the past 2 fiscal
years.

Finally, we will hear opponents argue that States and schools do not
really need all of this funding. I disagree. The bottom line is that
our schools do not need more excuses from Washington, DC. They need the
funding we promised and my amendment will provide it.
As I conclude, I want to be very clear what is at stake. This
amendment will determine whether we keep the funding promises we all
made when we voted for No Child Left Behind. Those who vote against
this amendment will have to explain to parents and teachers and
students and families and communities they represent why they refused
to provide the funding we promised in the No Child Left Behind Act.
If any of my colleagues want to argue against fully funding No Child
Left Behind, that of course is their right, but I will fight with
everything I have to give our schools the funding we promised so this
law can work. Our students deserve nothing less.
I urge my colleagues to stand up with all of us who are working hard
to make that law work for all of our students. I urge my colleagues to
vote for the Murray amendment.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, I thank the Senator from Washington for
offering this amendment. She offered it in the committee. This is one
of the most important amendments we will vote on during the
consideration of the budget resolution. The Senator from Washington has
been a strong leader on education issues.
If we are going to have a competitive country for the future, if we
are going to do something about this job loss that is occurring, we
have to have the best educated, best trained workforce in the world.
That is the message the Chairman of the Federal Reserve Board has sent
to Congress and to the United States.
Senator Murray is saying, we ought to put our money where our mouth
is, that we ought to keep the promise of No Child Left Behind, not just
send all the requirements out to the States but send the money along
with it that was promised in order to provide the resources necessary
to make these promises a reality.
I again thank the Senator from Washington for her leadership.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Washington controls the time.
The Senator from Washington.
Mrs. MURRAY. Mr. President, I yield 5 minutes to the Senator from
Maryland.
The PRESIDING OFFICER. The Senator from Maryland.
Ms. MIKULSKI. Mr. President, I thank the Senator from Washington
State. I enthusiastically rise in support of her amendment to fully
fund No Child Left Behind.
This is the 21st century. In our own country, we have to make sure we
are safer, that we have a stronger, more competitive economy. The way
we are going to be safer and stronger is if we get smarter. By
``smarter,'' I mean develop a 21st century workforce. In order to do
that, we need to make sure our elementary, middle, and high schools are
the best they can be.
This is why I support full funding of No Child Left Behind. We need
to focus on achievement. We need to focus on accountability. But while
we are looking to hold our public schools accountable, we need to hold
ourselves accountable in order to bring the resources to our public
schools.
Requirements without resources are an unfunded Federal mandate. If we
want to have a smarter workforce, we need to get behind our public
schools. The Murray amendment really takes us a long way in making sure
we have smaller class sizes, better trained teachers, and all the other
resources that go into that.
College is also an important part of being smarter. I am deeply
troubled that access to college, which has been one part of the
American dream, could now become part of the American financial
nightmare. I will be offering an amendment later on to help families
who want to send their children to college: a simple, straightforward
$4,000 tuition tax credit for every year of college.
Our middle-class families are stressed and stretched. Families in my
own State of Maryland are worried. They are worried about jobs. They
are worried about losing their health care, with costs ballooning. They
are worried about holding down more than one job to make ends meet.
They race from carpools to work and afterschool activities and back
again. But most of all, they want to know can they count on their
public schools, which is what Senator Murray is defending. They want to
know will their children be able to go to college.
I believe the United States of America should provide an opportunity
ladder and we need to make sure one of the rungs in that ladder is
access. That is why I believe a $4,000 tuition tax credit will go a
long way toward giving help to those who practice self-help--the
families who are working and saving to send their children to college,
and young people who are working and saving to send themselves to
college.

Tuition is on the rise at colleges. At my own University of Maryland,
there has been a 30-percent increase over the last 2 years. Tuition for
Baltimore Community College rose by $300 in 1 year. The average cost of
a 4-year public college is about $10,500. If you add the fees and
everything, at University of Maryland it is about $14,000. Those are
not numbers. Those are real costs to real families.
Financial aid, though, is not keeping up with the rising costs.
Today, Pell grants only cover 40 percent of the average costs at 4-year
public colleges. Twenty years ago, it covered 80 percent of the costs.

[[Page S2471]]

Our students are graduating with so much debt it is becoming their
first mortgage. Families and students are looking for help. But I
regret to say President Bush's budget does not offer them much hope.
The Republican budget has all the wrong priorities. It freezes the
Pell grants. It does not offer real tax breaks. Yet at the same time it
gives tax breaks to those who do not need them.
We need to do more. We need to help middle-class families have the
best education out of our public schools to get them ready for college.
But when they are ready to go to college, there should be the financial
help to get them there.
We need to double the Pell grant. We need a larger tuition tax
credit. We also need to make sure families have access to the American
dream.
College education is more important than ever. Forty percent of the
new jobs for the new century will require postsecondary education. This
cannot happen with platitudes. It has to happen with programs. To
compete in the global economy, we have to make sure all of our young
people have 21st century skills. In order to compete in the new world
order, we need to make sure all of our children have 21st century
skills for 21st century jobs. We need to remember the benefits of
education accrue not only to the individual but to society as well.
I stand here with my colleagues to say, if we are going to make
investments, we need to invest in human capital, to create a world-
class workforce. Let's have the best public schools the world has ever
seen and make sure we continue to have access to the American dream.
I yield the floor.
The PRESIDING OFFICER. The Senator's time has expired.
The Senator from Washington.
Mrs. MURRAY. Mr. President, I thank my colleague from Maryland.
Mr. KENNEDY. Mr. President, will the Senator be willing to yield for
a question?
Mrs. MURRAY. Yes.
Mr. KENNEDY. First, I see my friend and colleague from Montana wants
to address the Senate. I would like to comment after he concludes. But
I first of all want to thank the good Senator from Washington for
offering this amendment.
There is varied experience that is brought to the Senate by Members
of this body. But we are listening to a voice who has been a teacher
and also a school board member, and prior to entering the Senate
probably spent more time in the area of education, particularly young
children, certainly, than any other Member of this body.
When she speaks about education and what happens in the classrooms
and to the teachers, she is talking on the basis of a lifetime
experience. She makes a compelling case. I welcome the opportunity to
join with her.
I want to take a moment of the Senate's time and ask whether the kind
of situation we are facing in Massachusetts is typical of what she is
finding in her State or if she has heard about it in other States.
In my own State of Massachusetts, we passed effectively a ``no child
left behind'' bill 4 years prior to the time we passed it here in the
Senate. As a result, over a 7-year period, we find Massachusetts is No.
1 in the country in the fourth grade and No. 1 in the eighth grade. We
reduced the disparities with regard to race more than any other State.
It is because of those accepted concepts which the Senator from
Washington has talked about: smaller class size, well-trained teachers,
supplementary services, parental involvement, evaluation of the
children themselves, and support from the local communities.
These are the things for which she has fought. But when you fail to
do that--I have here before me a copy of the Boston Globe newspaper of
February 19, which talks about what is happening in the region: ``Deep
Cut in School Systems Taking a Toll on Educators.'' It lists school
systems feeling the effects because of the cutbacks, because of the
failure of us to provide for No Child Left Behind, plus what is
happening in the State.
Boston has lost 396 teachers. They have closed six schools. They have
cut the budgets on individual schools and eliminated programs.
For Braintree, they have lost 56 teachers and increased class sizes.
Bridgewater-Raynham Regional has lost 35 teachers, increased class
sizes, added a $175 bus fee, $200 athletic fee, and a $50
extracurricular fee, being paid by parents.
Fitchburg lost 47 teachers, increased class sizes, added a $180
annual bus fee, and raised the athletic fees from $30 to $40.
Haverhill lost 143 teachers, closed 6 schools, increased class sizes,
eliminated full-day kindergarten, added a $250 music fee, and raised
athletic fees from $50 to $300. As we all know, in education, if the
child works in music for 3 to 4 years, their average goes up 50 to 75
points in their test to go on to college.
The list goes on.
Lynn lost 85 teachers, closed 3 schools, eliminated full-day
kindergarten and prekindergarten.
Pittsfield lost 51 teachers, increased class sizes, eliminated
afterschool programs, added a $100 student activity fee.
Let me read this and ask whether this is something the Senator has
seen. Here we have this extraordinary superintendent, Thomas
Giancristiano, who has been in education for 30 years.

Let me read from the story:

On good nights, the superintendent fretted. On the bad
nights sleep vanished. Hours before dawn, thousands of
dollars and cents reeled in his head. Thomas Giancristiano
would lie in his bed in his Peabody home, eyes open and red,
and make deals with the school finance devil.
How many custodians do we need, the Winthrop superintendent
would ask. How many secretaries? If we keep the libraries
closed, can we keep one more kindergarten teacher?

That is what is happening out in the schools. Men and women who have
worked a lifetime trying to educate our children, this is what they are
going through.
Going back to the article, he then saw the cutbacks that took place
in his school district:

It was a hard moment to watch: A confident, likeable,
optimist with 30 years of education experience was faced with
cutting 17 teaching jobs. He chose instead to cut himself.
Giancristiano's voice was steady, his pique never showing.
Only his reddening eyes displayed his anger.
``Either you do not support me, or you do not support your
children,'' he read from notes.

This is happening across the country. This is what this budget is all
about. We have a chance to do something for these schools or we can
provide the additional kinds of tax breaks for the wealthiest
individuals.
The amendment of the Senator from Washington is responsible because
it pays for itself and also helps reduce the deficit. I commend the
Senator. I intend to speak longer, but I am just wondering, since I
listened to the Senator speak and since she is back home every weekend
talking to parents and schoolteachers and superintendents, whether the
kind of stories I mentioned very briefly are happening in her State and
are having a similar kind of impact on the men and women who have
devoted their lives to provide greater educational opportunity to
children in the State of Washington.
Mrs. MURRAY. Mr. President, I thank the Senator from Massachusetts
for defining for all of us what I think we are seeing across our
country in every school and every classroom where the morale among our
educators who are responsible for caring for our children every day has
declined dramatically.
The Senator will remember not that long ago when the Senate passed a
bill to increase class sizes in kindergarten, first, and second grades.
As I traveled around my State at that time, teachers were so
enthusiastic. They were excited about being given the opportunity to
help their young students learn to write and learn to do math so they
could be successful in life.
That atmosphere has changed dramatically. Now you travel around to
classrooms and they are begging and pleading for help. Every teacher
says to me: I want to do the right thing. I want to be accountable. I
want my students to be able to succeed. I want to make this work. But
my class size is twice as large. I get less time with parents. I am
paying more out of my own pocket for basic supplies. We don't have
enough books for all of our students. And even more so, I am spending

[[Page S2472]]

every single second teaching to this test because my students don't
have art and music and other things that help them be well-rounded
adults.
We can change this. We can make it better. We can do what we promised
2 years ago and fund this and really make a difference in our
children's lives.
I thank the Senator from Massachusetts for his question. I yield 10
minutes to the Senator from Montana.
Mr. BAUCUS. I thank my good friend from Washington.
Mr. President, I don't know what the debate is all about. This is a
no-brainer. It is an absolute no-brainer. All of us, when we are home
talking to our teachers and to our communities, to school boards, know
this is the right thing to do. It is clear. There is no contest. There
is no debate.
Congress passed No Child Left Behind trying to set levels of
accountability. But then Congress did not provide the money to
implement No Child Left Behind. It is contributing to all the cutbacks
in our elementary and secondary schools about which we are hearing. I
hear this constantly at home. I daresay that every Member of the
Senate, when he or she returns home, finds the same comments.
Again, I don't know why we are debating this amendment. It is pretty
clear. I highly compliment the Senator from Washington. I don't know
anybody who believes more and has spent more personal time helping to
educate our Nation's children than the Senator from Washington, who is
a schoolteacher. She is right. We should take our cues from what she is
telling us.
There is another reason to vote for this amendment. How are we paying
for it? Closing tax loopholes. That in and of itself should be enough
to pass the amendment. Also, we are closing tax loopholes to do
something that is good; that is, supporting education.
Education truly is a means of developing our greatest assets. We have
built the strongest, the most diverse economy on the planet, basically
through education. There is more mobility, more opportunity in America,
and one reason is our educational system.
We have pushed the technology horizon. We have developed a quality of
life that is the envy of much of the world. There is no doubt that we
can further improve our economy and our quality of life. But it is
important to note that it is the investment in education that has
essentially brought us to where we are, and it is an ongoing
investment. You cannot stop investing in education. You have to keep
going for obvious reasons.
Fully funding No Child Left Behind is a no-brainer. It is obvious we
should do this. Our people back home want us to do it. If you took a
poll at home, should No Child Left Behind be paid for, the results
would be overwhelming because people at home know what a tight spot
elementary and secondary education is in.
We are not giving our children our best shot. We have a moral
responsibility to leave this place in as good a shape or better than we
found it. That applies to the environment, education, the general
conditions in which the America public finds itself. It is unfortunate
in a certain sense--we are kind of lucky in another--that we have to
accelerate our support for education. Why? Because the world is
changing so quickly. New technologies are developing worldwide so
quickly. We, therefore, have an obligation to accelerate our emphasis
on education generally, and that is at all levels. It is Head Start,
elementary and secondary, continuing, 4-year colleges, graduate
education. It is at all levels.
Clearly, a key part of that is No Child Left Behind. So far this
administration is giving words to the concept. It says vote for No
Child Left Behind, but it has not backed it up with dollars.
A Presidential candidate years ago once asked: Where is the beef? I
will ask the same question: Where is the beef? Where is the support?
Where is the funding?

We have an opportunity to assist our children by providing them with
the necessary resources to help them meet the challenge. Under No Child
Left Behind, Montana was promised $71 million in 2005 to comply with
the new educational standards. What does this budget include? Half of
that, $46 million, and that is a shortfall. Add to that all the other
pressures schools are facing.
Again, this is a no-brainer. I compliment the Senators from
Washington and Massachusetts. Both of them work very hard for
education.
Jack Kennedy once said:

Our progress as a Nation can be no swifter than our
progress in education.

I think we all agree. Funding education is key to maintaining an
American workforce that can compete in the world economy. Education is
critical to keeping jobs and creating new jobs in the United States. A
big problem we know is the offshoring of American jobs. It is very
serious. We deserve to give it an answer.
I don't believe the answer has been given to us thus far by this
administration. We have heard nothing. It is laissez-faire: Let things
happen. So what if people lose their jobs. It is good in the long term.
That is essentially what the administration is saying.
I believe in order to keep our country strong we have to do something
positive. We have to take some action. We must advance policies to help
create new jobs in the United States, undertake measures designed to
keep good-paying jobs in the United States.
Finally, when jobs are lost in trade, we need to retrain workers and
help them get back in the workforce as quickly as possible. That is why
I believe it is right that one of the priority amendments on this side
of the aisle addresses jobs. It is why at the appropriate time I will
offer an amendment that will set us as a country on the path to
accomplishing those goals.
We must begin where the jobs begin. We must adopt policies to create
jobs in America. One of the best ways to do that is by supporting
research. Most of the innovative research done in the United States is
at universities and research institutes which attract students from
across the globe. Over the last 20 years, Federal research funding in
the physical sciences and engineering as a percentage of GDP has
actually declined. It has declined by nearly one-third. I believe we
should reverse that trend, increase Federal spending on basic research.
The money we spend will come back to us many times over in the creation
of new jobs and new industries making products yet to be invented.

If we want to support Federal spending on research, we should support
the National Science Foundation. The NSF funds research and education
in science and engineering through a variety of successful programs. It
accounts for roughly 20 percent of all Federal support to academic
institutions for basic research, a crucial engine of innovation for our
economy.
NSF funds have helped discover new technologies that have led to
multibillion-dollar industries and created countless new jobs. The list
is astounding: fiber optics, radar, wireless communication,
nanotechnology, plant genomics, magnetic resonance imaging, ultrasound,
and, yes, the Internet. All were made possible by work in the basic
sciences and engineering funded by the NSF.
Each year, the NSF helps fund over 200,000 students, teachers, and
researchers. Many of these people take their NSF-supported work into
industry, where they found company startups selling new products and
new technologies. That means one thing: jobs. Fully funding NSF will
lead to more jobs.
When the President signed the National Science Foundation
Authorization Act of 2002, the intent was to double in 5 years the
funding devoted to the NSF. Not fully funding NSF shortchanges
America's future.
The amendment I am offering will fulfill the promise of the NSF Act
and restore funding to its fully authorized levels. That means
providing $7.4 billion in fiscal year 2005, $8.5 billion in 2006, and
$9.8 billion in 2007. All told, that is $7.4 billion above current
levels--certainly money well spent.
Our future depends upon our ability to continue to innovate, and that
depends upon the support we give to America's innovators--our
scientists and engineers. We should fully fund the NSF.
At the same time, we must ensure America's families can afford higher
education, which is an important part of the solution. This is the key
to America's continued prosperity. Education provides the skills
necessary to unleash the creativity of our citizens.

[[Page S2473]]

We should improve, consolidate, and expand the educational tax
incentives that already exist and make them more effective. There are
many ways.
We can expand and extend the deduction for tuition expenses, expand
the Hope and lifetime learning credits, craft targeted incentives for
student pursuing science and engineering careers, and focus on programs
to make it possible for nontraditional students to obtain an education.
These are all good options.
We need to ensure that young Americans are not discouraged from
obtaining postsecondary education because of costs. That is the
American dream, to get an education. We should not discourage it.
Tuition costs have risen considerably in recent years, and our Federal
assistance programs have not kept up.
Increasing tax incentives can help to lessen the burden on students,
and allow students to attend the schools that best fit their needs,
whether 4-year colleges or 2-year colleges, which can also provide
vocational and technical training.

I ask for an additional 2 minutes.
Mrs. MURRAY. Off of the Senator's time.
The PRESIDING OFFICER. The Senator is recognized for 2 additional
minutes.
Mr. BAUCUS. Different students will opt for different types of
training. That is good. We need workers with different skills to fill
all the new jobs that are constantly being created.
One thing is sure: We need to train more engineers. Listen to this,
Mr. President. We train only half as many engineers as does Japan. We
train only half as many engineers as does Europe. We train only a third
as many as does China. Think how many engineers China is going to train
next year and the year after that and the year after that. Where will
we be? Engineers play a critical role in the development of new jobs
and new industries. We should encourage students to pursue training in
this vital field.
We need to help displaced workers to receive the retraining needed to
succeed in a changing economy. There is one thing they can be sure of:
Things will always change. Jobs will change. Workers should be equipped
with the tools to change with these jobs. Education is certainly the
key.
The amendment I am going to offer will put a downpayment of $10
billion into our workforce. The U.S. economy is the most flexible,
vibrant, dynamic in the world. We have to keep it that way. We owe that
to the ingenuity of the American people and their relentless thirst to
create and innovate.
I urge my colleagues to join me in a positive response to offshoring.
It should not be negative; it should not be protectionism. It has to be
positive. I am offering a sound, positive approach. Create jobs in
America by fully funding the National Science Foundation and support
education. That is one of the keys to our long-term prosperity.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma is recognized.
Mr. NICKLES. Mr. President, before my friend and colleague from
Montana leaves, I want to say this amendment increases taxes by $17.2
billion. It increases taxes next year by $13.2 billion.
For the information of colleagues, we are assuming next year, on the
reconciliation, which is all that is going to happen this year--or
maybe all that will happen--that is the total child credit, it so
happens. Some people say, well, this is assuming revenue loophole
closings. That is not accurate. This resolution says increased taxes by
$17.2 billion. We are assuming that the child credit is going to stay
at $1,000 per child. So these two are in direct conflict. I want
everybody to know this is a big spending increase in an area where we
already have big spending increases--enormous, if you go over the last
few years.
In spite of that, it is a big tax increase. In fact, it is a lot
bigger tax increase than the amendment we voted on yesterday. I want
people to know this is a tax increase that is very large.
Mr. BAUCUS. Will the Senator yield on that point?
Mr. NICKLES. Yes.
Mr. BAUCUS. Will the Senator read the first line of the description
of this amendment?
Mr. NICKLES. I am reading the amendment where it says offered by
Senator Murray and ``on line''----
Mr. BAUCUS. Above that, further up.
Mr. NICKLES. The purpose?
Mr. BAUCUS. Yes.
Mr. NICKLES. It says, ``by closing tax loopholes.''
Mr. BAUCUS. Does the Senator disagree that we should close tax
loopholes?
Mr. NICKLES. But that is not what this amendment does. That is the
purpose. The amendment says: ``On page 3, line 10, increase the amount
by $13.2 billion.'' That is increasing taxes, an instruction to the
Finance Committee.
Mr. BAUCUS. By closing tax loopholes.
The PRESIDING OFFICER. The Senators all address each other through
the Chair.
Mr. BAUCUS. The purpose is to close tax loopholes.
Mr. NICKLES. Mr. President, I have the floor.
The PRESIDING OFFICER. The Senator from Oklahoma has the floor.
Mr. NICKLES. I have the floor. I want to make sure my colleague knows
how to understand what these amendments say. If you read lines 1, 2, 3,
and 4, that increases taxes by $17.2 billion over the resolution. Our
resolution assumes continuation of the existing tax law. So this would
increase taxes by $17.2 billion over existing law.
All we are assuming, frankly, in the big amount we have for next
year, since that is the bulk of our tax increase, it happens to be for
the child credit. So I am telling my colleagues, we talk about closing
loopholes--and there are some out there. I know the chairman and
ranking member are trying to do that with the leasing provision. I
happen to support that. But you are spending it as well.
This resolution says increase taxes. The purpose doesn't make law;
the purpose doesn't change the resolution. You can put anything up
there. You could have as a purpose to make everybody feel good and to
have nice incomes in education. That can be your purpose. But when you
are amending the budget resolution, you are saying how much money to
spend and how much money to tax. This resolution says to raise taxes by
$17.2 billion and raise spending by $8.6 billion.
I might also say that it raises spending by $8.6 billion in the first
year. One would think you would not do that for 1 year and drop it
down. So you can assume it would be 8.6 for a multitude of years. This
is really like a $100 billion amendment on the spending side over 10
years, and then on the tax side, I don't know how many. If you multiply
this out over the years, it increases taxes by 17.2 and spending by
8.6.
Mr. BAUCUS. If the Senator will yield, the only way to close tax
loopholes is by raising additional revenue. That is the only way you
can do it. There is no way to close loopholes otherwise. Does the
Senator agree that he will work with me in closing loopholes and if not
by raising revenue in some other way? The purpose of the amendment is
to raise revenue by closing tax loopholes. I assume the Senator agrees
with me that is the best way we should raise the revenue, although
technically we have to have the numbers in here; otherwise, the
amendment serves no purpose.

Mr. NICKLES. Mr. President, I enjoy working with my colleague from
Montana on the Finance Committee, and I am one who is more than willing
to close loopholes. I also tell my colleagues that my friend from
Montana and the Senator from Iowa have used almost every loophole
closer, multiple times.
I am happy to close loopholes, but this amendment does not close
loopholes. This amendment tells the Finance Committee to raise taxes by
$17.2 billion, period. The Finance Committee can do it any way they
want. I am just telling the Senator that is exactly what it says.
What we have assumed is we are going to allow the child tax credit to
go forward. Maybe that is not a correct assumption. Maybe families are
not going to get to keep the present tax law. Maybe the child tax
credit will be reduced from $1,000 to $700. Maybe the marriage penalty
relief we have in the year 2004 will not happen in 2005. I am afraid,
if this amendment is adopted, it will not happen.
Ms. LANDRIEU. Will the Senator yield?
Mr. NICKLES. Not just yet. My point is--and I have not even alluded
to the

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education issue, and I am going to hand that to Senator Gregg who knows
far more about education than this Senator--no matter what level we had
in this resolution, I was more than confident somebody would say that
is not enough for education. I have looked at the total education
function we have, and it totals $97.6 billion. That does not include
the additional $5 billion--yes, it does. That includes the $5 billion
Senator Gregg has put in for higher education reauthorization.
I looked at what we spent. That is $97 billion. In 1990, we spent $39
billion, almost three times as much. In the year 2000, we spent $49
billion. It is right at twice as much as we spent in the year 2000. We
have had dramatic increases in education--dramatic increases--including
the last several years. But no matter what that amount is, people are
going to say that is not enough and, oh, yes, we want to increase taxes
a lot more and throw a lot more money at it. I am just not sure that is
the correct result we should be following.
I want everybody to know this is a tax increase. I want everybody to
know this is a humongous increase in this program. I have not figured
the percentage.
Ms. LANDRIEU. Will the Senator yield?
Mr. NICKLES. With this additional money, it is a 40.6-percent
increase. For everybody who says we want to balance the budget, how do
you balance the budget and simultaneously increase programs by 40
percent? This fictitious point of let's close loopholes, if there are
loopholes out there, I am sure the chairman and the ranking member of
the Finance Committee want to close them because they have a lot of
demands. I am all for closing loopholes, but that doesn't fly. The
amendment says raise taxes by $17.2 billion.
Ms. LANDRIEU. Will the Senator yield?
Mr. NICKLES. I yield the floor.
The PRESIDING OFFICER. The Senator from Washington controls the time.
Mrs. MURRAY. I yield to the Senator from Louisiana 10 minutes.
The PRESIDING OFFICER. The Senator from Louisiana is recognized for
10 minutes.
Ms. LANDRIEU. I thank the Chair. Mr. President, I thank my friend
from Washington.
I wanted to ask the Senator from Oklahoma, before he leaves, since he
has gone on record several times this morning as to what loopholes he
would agree to close, would he for the record indicate or give us some
idea what some of those loopholes would be and how much money could be
generated by those loopholes, because there are many people in
Oklahoma, Louisiana, Massachusetts, and Washington who would be
interested in identifying those dollars so we could apply them to
fulfill the promise the President made to fund education. As the Budget
chairman, I am very interested in what specific loopholes he would be
willing to close.
Mr. NICKLES. To answer my colleague's question, in the budget
resolution we assume $20 billion of revenue loopholes and that,
frankly, is to pay for the tax cuts we have in this bill.
Ms. LANDRIEU. Can I clarify? The loopholes the Senator from Oklahoma
is supporting are going to fund additional tax cuts for those at the
higher end of the tax cuts?
Mr. NICKLES. The Senator is absolutely incorrect. The loopholes we
are closing basically will pay for extending present law. What we
assumed in this budget resolution is continuation of present law, plus
the AMT fix.
Ms. LANDRIEU. I thank the Senator from Oklahoma. I have the floor. I
want to make clear for the record, as the Senator from Oklahoma just
clarified, he and the administration are willing to close loopholes,
but only if the savings from those loopholes go to make permanent the
tax cuts that drain the education budget and leave our children at
risk. I am glad we got that cleared up.
Let me begin the remarks I wish to make this morning.
The Senators from Massachusetts and Washington are absolutely correct
about the dire situation in our States and communities all across the
Nation. They are also correct that one of the strongest aspects of the
American dream--and I could argue the strongest aspect of the American
dream--is the dream parents have for their children, the dream
Americans share that no matter how tough their life has been, no matter
how shortchanged they might have been when they started, they work hard
because they want their children to get the kind of education that will
help them be the human beings parents dream their children can and
should be and to make their communities stronger.
When this administration took office, they noted that dream. The
President said:

The time has come for excuse making to end. With this No
Child Left Behind Act, we have committed the Nation to higher
standards for every public school, and we have committed the
resources necessary to help children achieve those standards.
We want accountability with results, and we are willing to
fund it.

That is what was said, but is not what was done. Budgets are
difficult to put together. This document does not look very thick, but
this document is a blueprint. This document sets a course for the
Nation. This document, if it is not written correctly, cannot meet the
promises I have just described.

You know what, Mr. President, this document does not meet that
promise. This document does not provide the money promised to every
Governor, every superintendent, every teacher, and every parent in this
Nation. This document is short $9 billion, and not one Senator on the
other side is willing to close one loophole to fill that hole. They are
only willing to close loopholes to give more tax cuts. That is the
debate on this floor, and that is the choice the American people are
going to make in the next election.
With the surplus disappearing, with the war at hand, with the war on
terrorism perhaps escalating, the question is, Do we want to make some
adjustments in our plans to provide tax cuts or do we want to provide
some tax cuts and fund education, invest in homeland security, and
support our troops? That is the issue. But this administration, faced
with the facts of declining and evaporating surpluses, faced with the
facts of a war that is costing more than we anticipated, faced with
those facts, chooses to ignore the facts and put out a budget that goes
straight dead ahead 100 miles an hour into deficits and in doing so
robs the opportunity, pulls the rug out from under every
superintendent, every Governor, and every teacher because they are
struggling in the schools.
This is what the President says, but this is not what he does. This
is what the President says:

Once failing schools are identified, we will help them
improve. We'll help them help themselves. Our goal is to
improve public education. We want success, and when schools
are willing to accept the reality that the accountability
system points out and are willing to change, we will help
them.

We are doing this in Louisiana. We have received accountability. We
have identified our schools which are failing. We believed the
President, but when we turned to him to ask him and this administration
to help us hire new teachers, help us to train the teachers who need to
be certified by a date certain the President and the administration
forced us to do in this act, when we asked them please help us put on
two new classrooms in these schools because we have to meet these new
goals, they said we do not have any money, because he wants to extend
the tax cuts permanently. He will close the loopholes, but not for
them. Sorry, kids, we cannot close the loopholes. I have to close the
loopholes for people who need tax cuts.
Now I am going to talk about the increases in education. I know
Senator Kennedy is going to speak about this and he knows these numbers
better than I do. I will admit, and I understand and know--so don't
anybody bother coming to the floor to tell me I do not understand--
there is increased funding in education. I am clear and so are the
people in my State that the Federal Government has increased funding.
That is not the point. The point is, the increases have not been what
the administration promised and do not help us meet the new goals that
have been mandated on every county and every parish in this Nation.
I will also say, if the Senator from New Hampshire wants to come to
the floor and debate this issue--and as Senator Murray knows very
well--the increase in education in 2001, which was

[[Page S2475]]

the last budget of the previous administration, was 19 percent. That is
how much the increase was. The next year is 2002, which was 18 percent.
In the years of the President's budget, which is right here--this is
the administration's budget and this is the chairman's mark. The
chairman's mark is a little different than the President but it is
basically the same document. These are the increases they provide: 19
percent, 18 percent, down to 6 percent, 5 percent, and 3 percent. The
outyears look even bleaker.
They put No Child Left Behind basically in here, and as we can see,
they pulled the rug out from everybody. That is what this election is
going to be about.
I know I only have a couple minutes remaining, but I want to say I
know, not because I represent and am a leader from my State and I
travel just like Senator Murray does all over her State, how angry
people are about this. The front page of the Washington Post yesterday
issued a poll that says 57 percent of the American people polled all
over the country do not think the country is going in the right
direction.
This budget sets the direction, and 57 percent of the people know
what is in this budget, not in every line but they are getting the
general gist of it. They do not like it, and I do not blame them. There
are many things it does, but one thing it does is it breaks the promise
to their kids, and when you start fooling with people's children and
you start upsetting the dream people have for their children and their
education, there is going to be a repercussion from that.
In conclusion, to use the President's own words: The time for excuse-
making has come to an end. We have committed to our schools and our
children. We have said if we ask for accountability and results, the
Federal Government will be there, will be a reliable partner, and this
administration has made different choices.
I end with a quote from another President. We have had many great
Presidents in our history, thank goodness, and we had a great one in
President Kennedy who said:

I believe we possess all the resources and talents
necessary, but the facts of the matter are we have never made
the national decisions or marshaled the national resources
required for such leadership.

He was speaking about the space program.

We have never specified long-range goals on an urgent
timetable, or managed our resources and our time so as to
insure their fulfillment. . . . [L]et it be clear that I am
asking the Congress and the country to accept a firm
commitment to a new course of action--a course which will
last for many years and carry very heavy costs . . . if we
are to go only half way, or to reduce our sights in the face
of difficulty . . . it would be better not to go at all.

That is what I am saying. If we have set a course by this budget, we
owe it to our parents, to our teachers, and our children to stay the
course, and if we are not ready to go the whole distance, we should not
have started. That is the promise that has been broken.
I yield the floor.
The PRESIDING OFFICER. The Senator's time has expired.
The Senator from New Hampshire.
Mr. GREGG. Mr. President, I have been talking with the manager of the
bill on the Democratic side, and he suggested maybe we should enter
into some sort of time agreement on this amendment. I see there are a
number of people on his side who want to speak. Is there something the
Senator recommends?
Mr. CONRAD. I would say first to the people on our side, we are now
getting in a real jam and we are also getting further toward vote-arama
in a way I think is probably not something we want to do. I recommend
we agree to an additional hour on each side, 2 hours equally divided.
Mr. GREGG. Mr. President, I recognize that probably is a disadvantage
for us because the other side has been going now for an hour, and
although we are probably more succinct and more persuasive in less
time----
Mr. CONRAD. That is what we were counting on.
Mr. GREGG. It is still not necessarily a fair division of the time. I
would agree to some sort of time limit that gave us a little extra
time. If the other side wants to go for an hour and we go for an hour
and 15 minutes, which would be 2 hours and 15 minutes on this
amendment, that would give them an additional hour--they have already
done an hour--and we would get an hour and 15 minutes.
Mr. CONRAD. Would that be acceptable if we took an additional hour on
our side and an additional hour and 15 minutes on their side?
Mrs. MURRAY. It is acceptable to me.
Ms. LANDRIEU. Is there any additional time that could be available?
This is such an important amendment. Could we take an hour and a half?
Mr. CONRAD. We had hoped to do this in 2 hours. We have already spent
an hour, and this would be an additional 2 hours 15 minutes.
Ms. LANDRIEU. I understand.
Mr. CONRAD. It would be agreeable on this side.
Mr. GREGG. I ask unanimous consent that debate on this amendment be
for an additional 2 hours and 15 minutes with an hour on the minority
side and an hour and 15 minutes on the majority side.
The PRESIDING OFFICER. Is there objection?
Mr. CONRAD. I ask that there be no second degrees.
The PRESIDING OFFICER. Is there objection to the unanimous consent
request? Without objection, it is so ordered.
Mr. CONRAD. Is Senator Reed seeking time?
Mr. REED. Yes.
Mr. CONRAD. Will Senator Murray give time off the amendment?
Mrs. MURRAY. I yield to the Senator from Rhode Island.
The PRESIDING OFFICER. The Senator from Rhode Island is recognized.
Mr. REED. Mr. President, I rise in support of the Murray amendment to
fully fund the No Child Left Behind Act. This is an important
amendment. It will keep our commitment to educational reform in the
United States.
There are two keys to the success of the No Child Left Behind Act:
effective implementation by the Department of Education and robust
funding. Both are presently lacking.
Without the needed resources, we will not meet the law's goals of
closing achievement gaps and ensuring an excellent education and
opportunity for all children.
When the President signed the No Child Left Behind Act into law 2
years ago, he pledged to support greater Federal investment in
education. That pledge has not been kept by this President. He has
proposed eliminating some of the No Child Left Behind Act programs,
cutting others and only increasing title 1 by $1 billion. That is over
$7 billion short of the authorized level of $20.5 billion.
The No Child Left Behind Act was a fundamental change in the way we
do business. Part of that change was a commitment to fund all of our
aggressive ambitions to help every child succeed. What has been left
are the requirements on children but insufficient resources for school
systems throughout this country to implement them.
It is no wonder general assemblies across this country, in Utah, in
Virginia, Republican assemblies, are revolting against these
provisions, not because it is not a good effort at reform. Rather it is
because we have not provided the resources to accomplish the reforms.
Senator Murray's amendment would provide the needed resources.
I believe we have to go ahead and fund these programs, and we will
not do so unless the Murray amendment is accepted. I urge support of
the Murray amendment. This is not just about giving individual
opportunity to every child. That is central and crucial. This is also
about our economic future. If we do not fully fund education now in the
elementary and secondary years, we will fall further behind in a very
competitive world economy. This is about giving every child a chance
and making sure our economy and our society works. I commend the
Senator for doing that, and I yield the floor to Senator Murray.

The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Mr. President, the other side is not ready to go. I
yield to the Senator from Massachusetts.
The PRESIDING OFFICER. The Senator from Massachusetts.
Mr. KENNEDY. Fine, if that is the desire. Mr. President, I ask 10
minutes on the Murray amendment.
The PRESIDING OFFICER. The Senator is recognized for 10 minutes.

[[Page S2476]]

Mr. KENNEDY. Mr. President, I mentioned a moment or two earlier what
is happening in my own State, in Massachusetts, in the school districts
all across that State, a State that was attempting to enhance
educational opportunities for the children of Massachusetts. They
relied upon the commitment that the Federal Government made a few years
ago, some 3 years ago, to try to complete the commitment of that State,
in partnership with the Federal Government, in enhancing educational
opportunities for the children in our State and in States across this
country.
The Murray amendment addresses the nature of the commitment that the
administration made to not just the Members of the Senate but to the
children and to the parents and to the school districts across the
country; that is, we were going to have reform and the resources to
make the reform take hold.
What we are talking about is a budget of $2.4 trillion, and the issue
is can we find $8.6 billion in that $2.4 trillion. Education is either
important or it is not. If we ask families all across this country,
people would say, I would think you would be able, in a budget of $2.4
trillion, to find the $8 billion to make sure we are going to fund No
Child Left Behind. It should not be that big a deal. It is a question
of priority.
The Senator from Washington stated what her priorities are. I agree
with them, and I think most families in this country would say we can
afford that, if it is going to make a difference in the quality of the
education of the children of this country.
Let's review very quickly the bidding, what has happened in the
period since we passed No Child Left Behind. Since we passed the No
Child Left Behind bill in 2002, let's be frank about where the funding
is and where it has come from. When we passed No Child Left Behind, the
administration asked for $1.3 billion. We raised that up to $4.8
billion during the period of the negotiation. That legislation would
not have passed at $1.3 billion. It would not have passed. I can tell
you that. I know that.

Then the next year the administration came in for less than $1
billion and we were able to raise that up $3 billion more. That is the
record. That is the increase right here, as a result of Democratic
amendments to the appropriations, right there.
Last year, in the Omnibus bill, the administration asked for a $900
million cut and we increased it $1.9 billion.
We will hear from the other side, look at the increases we have had
in this area. They are the result of the amendments from this side. We
want to continue it. If you like what we have done, vote for the Murray
amendment.
Look at what this amendment does right here.
Mr. GREGG. Will the Senator yield on that point?
Mr. KENNEDY. Not just yet, if I have 10 minutes. I will at the end of
my time.
Here we are, the cost of the Bush tax cut for those making over
$337,000 in 2005--$45 billion. It is $45 billion.
Look at what the Murray amendment has, $8.6 billion. That is in
addition to what was added, in terms of the Budget Committee--$8.6
billion. This is $45 billion.
The issue is choices. The issue is priorities. The issue is, as a
matter of national urgency, is it more important to give $45 billion
for those making over $337,000 in 2005, or to provide the full funding
for the children of this country? That is the choice. That is the
decision we are facing.
The Murray amendment says let's get that money. We can certainly
afford $45 billion--with that budget.
Let's look at what happens if we do not do this, if we do not accept
the Murray amendment. What is going to be the impact on the children of
this country?
I tried, in just the couple of minutes, to tell what the human impact
was on a superintendent who has for 30 years been committed to
improving the quality of the life of the children in his district. He
was restless. He couldn't sleep. Finally, rather than face the
additional cuts he was going to have to provide in this system, he
actually resigned. That is happening in schools all across this
country. Those are the real stories. That is what is really happening.
If we look at it in the broad sweep of what this means, this chart
tells it. Under the Bush budget going out the years from 2005 to 2013,
you are going to leave 4 million children behind. Under the Murray
amendment and the follow-on, all the children will be addressed; no
child will be left behind.
I was absolutely amazed, listening to the other side, saying if we go
and approve the Murray amendment this will be a 40-percent increase.
Imagine that, a 40-percent increase, thinking this body will never go
for a 40-percent increase. In fact, even with that, that will only mean
60 percent of the total funding for No Child Left Behind. We are
requiring 100-percent performance by those children. We are expecting
100-percent performance by the teachers. We are expecting 100-percent
performance by those people who are providing the supplementary
services, and we in the Congress say you do it on 60 percent of the
money.

It is like in this Nation, if we passed a voting rights act to apply
to all of the country and we say it is not going to apply to 10 States.
We will have Social Security for America but we are going to leave 10
States out.
We really didn't mean it when we said we were going to really address
the needs of the 12 million children who fall into the category of
title I. We didn't really mean it for all of them. We said it in the
bill. We require it in the legislative proposal that in 12 years they
have to be proficient--except you are not funding it. What sense does
that make?
It would have been like President Kennedy saying, you are going to go
to the Moon, and we appropriate enough money to go up 50 miles and say
we have had a success. You either do it or you don't. We were either
serious at the time when we passed No Child Left Behind, like we were
on voting rights, like we were on Social Security, like we were on
Medicare, and like we were on going to the Moon. Or we are not. That is
what the issue is. That is what the issue is in the Senate. Either
children have that priority or they do not. The Democrats believe they
do.
We find there is more than enough money in here right now to be able
to do it. There is more than enough money in here to be able to do it.
I am glad to yield to my friend from New Hampshire if he still has a
question.
Mr. GREGG. I will try to recall it.
Mr. KENNEDY. Mr. President, I will be around for a little while. I
know there are others who want to speak. I will withhold the remainder
of the time but I will be around, ready to answer any questions. I
thank the Senator.
The PRESIDING OFFICER. Who yields time?
Mr. GREGG. Mr. President, I appreciate the comments of the Senators
supporting the position represented by Senator Murray. But I do believe
it is important to understand from where we come and where we are
going, relative to educational spending in this country, and
specifically in this Congress, and who is accountable for what.
Because, obviously, the representation coming from the other side is
that this President and this Republican Congress has not been as
committed to education as we should have been.
It is a hard case to make, honestly, in light of the history of
educational spending.
Let us return to the scene of the crime, as they say in the business
of reviewing evidentiary facts. The scene of the crime is the Clinton
administration, its spending on education, and its woeful efforts in
the area of special education and title I. The scene of the crime is
the Clinton administration and its failure to address the fact that for
generations low-income children had been left behind in this Nation.
That is what this is about. You can throw out all the numbers you
want. But the issue is whether we as a Nation will continue to abandon
the low-income child and leave him or her in school systems which
simply shuttle him or her through, meaning when he got to the end of
his or her academic career--if you can even call it that--in our school
systems, he or she was unable to participate in the American dream
because she couldn't read and he couldn't write relative to their
peers.
The President of the United States, George Bush, came into office and
he

[[Page S2477]]

said, Let us do something about this. Let us address the issue of the
fact that so many children in this Nation for generations have been
shuttled through the system. He proposed the No Child Left Behind Act
as a way to address that. The No Child Left Behind Act is not only
about money in a tangential way. No Child Left Behind is really about
the philosophy of whether a low-income child should enter the school
system at a level at which they are not competitive with their peers
and be left in that school system for the rest of their academic career
and come out at a level that is not competitive with their peers.
The No Child Left Behind Act is an issue of whether we are going to
try to take the children in this country who come from a low-income
family and give them a shot at the American dream by bringing their
education up to a level where they at least know what they need to know
in order to participate in our society, which is a very academically
oriented society--a society which depends disproportionately on your
educational ability in order to obtain success.
The President proposed the concept which was to say to local school
districts throughout this country, You decide, school districts, what
children in your school know in the third grade, in the fourth grade,
in the fifth grade, in the sixth grade, in the seventh grade, or in the
eighth grade. You decide. We as a Federal Government are not going to
tell you. You go out as a community, you sit down and brainstorm and
decide what your fourth graders should know, what level of math, what
level of composition capability, what level of English. Then once you
decide that, you set up a process, a regimen, where you evaluate
whether the children in your school system are meeting those
obligations, are meeting those standards, are learning English at the
level and writing and spelling at the level you, the local school
district, decide is appropriate.
One of the key things the President said was don't cover up the low-
income child by putting them in a large group with all the other
children in the school system--what is called disaggregation. Let us
look at these different groups, whether they come from minority
backgrounds, whether they come from low-English backgrounds, or low-
income backgrounds. Let us find out what each group of children
actually is learning.
Let us not say just because fourth graders in the school system which
has a lot of kids and who come from average income families that are
doing well on the scores as a gross number, but that school system is
working well when we know for a fact the low-income kids in that school
system are still being left behind--disaggregation.
We set up a system. The President proposed a system where we go out
and say to the local school, You find out, you find out, parents,
teachers, and principals, what children should learn in these
elementary school grades and say whether the children by income groups
or by ethnic groups are learning.
Those two ideas were rather radical. But the radical idea was we were
actually going to tell the parents in the school system whether their
children are being taught, whether they are learning at a level that is
going to bring them up to their peers. Low-income parents--most of
whom, by the way, are single parents struggling to make ends meet--are
finally going to know whether their children in that school system are
learning what is necessary in order to make them competitive as defined
by that school system and as defined by their peers. If the parent
finds out their child is in a school system that is not teaching that
child, then we are going to give the parents some tools to try to
correct that problem. We are going to allow public school choice. We
are going to allow extra help for low-income kids so they can be
brought up to speed if they aren't up to speed with their peers. We are
going to allow the school districts to go into schools, which
unfortunately have systemic failures, or large percentage failures, and
put more resources into those schools to try to correct their problems.
This was the idea. It was revolutionary, and it has fundamentally
improved education in this country. Everywhere you go in this country
today, school districts are addressing the issue of whether the
children are learning, whether the low-income kids are learning,
whether they are being assessed, and the information is being put out
to the public and the public is making assessments as to whether it is
right.
This bill has been one of the most creative and aggressive bills we
have ever passed as a Congress, or even the States, in the area of
trying to correct what has been a fundamental problem in which our
public school systems, regrettably for years, were passing low-income
kids off and not giving them a shot at the American dream. It is
working.
We incessantly hear from the other side about the failure of the
bill. Why are we hearing that? Is it really because it has not been
funded? No. It is because there is an educational establishment out
there which does not like the fact it is being held accountable. This
isn't about funding. This is a raw attempt by the educational
establishment to try to undermine the No Child Left Behind Act law
because they do not like the fact they are being held accountable. They
do not like the fact low-income kids are finally getting a chance, are
finally learning something, or are being told they have to learn
something.
That is what this debate is about. Let us not try to color it with
money because it is not about money. Let us get into the money issue to
prove that is not the case.
If money were the issue, the prior administration would have poured a
lot more money into this program than they did. They did not. If money
were the issue, the school systems in this country would not have
enough money to do the assessments that are the essence of this whole
bill. They not only have enough money to do the assessments, but they
have more than enough money to do the assessments under this bill. If
money were the issue, the money we have already put in the pipeline
would have been spent. There wouldn't be any available.

What we find is there are literally billions of dollars of money in
the pipeline which have not been spent as a result of the fact this law
has been aggressively funded.
Let me put it in context. The last time the President of this country
was a Democrat and the Congress was Democratically controlled was 1995.
You would have thought at that time, if you listened to the rhetoric
around here, title I and the programs under title I which still existed
at that time--the No Child Left Behind Act obviously wasn't the law--
would have been funded right up to the authorization amount. That is
all we have heard about from the other side on this bill.
Surprise. It wasn't. It wasn't even close to the full authorization
amount in 1995. Not only that but the increases which flowed into the
account under a prior administration were minuscule in key areas such
as title I and special education.
I heard the good Senator from Massachusetts come down here and say
all the new money that has gone into title I, or most of it, is the
result of the fact they offered amendments on the other side and those
amendments made the changes in these programs and added all of this
extra money. I appreciate the fact he at least gives credit to this
administration for putting a larger amount of new dollars into the
education accounts. That is nice, because it is true. There has been a
huge infusion of new dollars into the education accounts.
This chart shows that in real terms. I appreciate the fact the
Senator from Massachusetts basically acknowledged it. The last year of
the Clinton administration, it was $42.2 billion in education accounts.
As of this year, there will be $58.7 billion in education funding,
which shows the rather dramatic increase.
Ms. LANDRIEU. Will the Senator yield?
Mr. GREGG. I will yield when I finish my statement. I would be happy
to.
If we go to title I, we will see in the last year the Presidency and
the Congress were controlled by the Democratic Party, there was $6.7
billion spent on title I. When the Republicans took over the Congress,
by the way, that started to move up. In the years since President Bush
has come into office, that number has jumped dramatically, so we are
now up to $13.3 billion being spent on title I.

[[Page S2478]]

The same is true of IDEA, which is a more startling number because
the Clinton administration never proposed increases in IDEA until the
last year and they were the result of a Republican Congress forcing
those increases into the Clinton administration. Again, the IDEA
numbers went down during the first years of the Clinton administration
and started to go back up when the Republicans took control of the
Congress. I was very involved when we demanded $1 billion a year. This
President has proposed more increases in the first 3 years in IDEA
funding--$1 billion each year onto each prior year--than the Clinton
administration proposed in their entire 8 years in office. This is an
example of that during the Clinton administration. IDEA funding was
increased by $1.4 billion over their 8 years. In three years in office,
President Bush has increased that money by $3.7 billion.
It brings me back to a side issue. I found it entertaining that
basically if we listen to the Senator from Massachusetts, he said all
this new funding which has flowed into the various accounts--and it has
been dramatic, as shown by the first chart, into special education and
title I--it was a function of amendments offered by the Democratic
leadership and the Democratic membership of this Congress. I point out
I am not aware the Democratic Party controlled the Congress for these 3
years and it certainly did not control the Presidency, so I am not sure
how they managed to do that. The fact is we could not pass the
amendments unless the President agreed to them, signed the bills, and
the Republican Congress agreed to them and passed it.
What can be pointed out is when the Clinton administration and the
Democratic Congress did control the issue of funding, had unilateral
control of the issue over funding because they had both Houses of
Congress and the Presidency, their accounts went down. It was not until
a Republican Congress and a Republican Senate made it its No. 1
priority under Senator Lott, Senator Specter, and other Members of this
Congress that we started to see the IDEA funding go back up
dramatically.
This is a very substantive point because it makes the case that what
we are hearing from the other side is truly politics, the politics of
education, not the substance of education. The substance of education
is whether a low-income child in America today is better off in the
system than they were 3 years ago. There can be no question but that
child is. Finally, after years and years and years, we are finding out
whether that child is being educated at the same level as his peers,
through assessment, and when we find that out and if we discover that
child is not being educated up to his peers, we put in place systems to
address that.

It is also important while we are on this topic to address the nature
of this amendment. The amendment does not actually say the funding will
go to education. The amendment sets up a reserve fund. The only thing
the amendment actually does is raise taxes. It raises taxes by $17
billion and puts that money in an account. That account may or may not
get spent. What we do know is it will raise taxes.
What does $17 billion in new taxes account for? We heard from the
other side it will go against those wealthy Americans who are making
too much money and we need to tax them some more. That may
philosophically be what they want to do, but as a practical matter that
is not the effect this amendment would have. The proposals which are
most at risk today in the tax laws do not impact wealthy Americans;
they impact moderate- and middle-income Americans. It is the child tax
credit that lapses, it is the marriage tax penalty which goes back into
place, and it is the 10-percent bracket which gets kicked back out if
we do not extend the tax reductions which are on the books.
Ironically, the $17 billion of higher taxes which this amendment is
going to force on the American people is probably going to be borne
primarily by people who are married, because the spousal deductions and
the marriage tax penalty, if not extended, add up to $15.7 billion, an
ironic joining of numbers but clearly a logical place where it will
occur. If the $17 billion tax increase occurs, it will occur as a
result of these extenders not being put in place. Therefore, the
spousal tax, which is $15.7 billion and which basically says if you are
married you should not have to pay more than if you were separated,
will end up being most likely the place I suspect this tax increase
will occur.
This amendment is unique in that it does not really impact the
education accounts because it puts it into reserve. It does, however,
raise taxes, and most likely on married people.
While we are on the subject of how well funded No Child Left Behind
is, we should go into some specifics. The No Child Left Behind part of
title I--and what we have are charts that reflect how significantly we
have increased funding under title I since President Bush came into
office. Over the 8 years President Clinton was in office, he raised the
dollars into title I by $2.6 billion. In the 3 years since President
Bush has been in office, we have seen a $4.6 billion increase or almost
twice as much, at least 70-percent higher funding levels from President
Bush as from President Clinton.
The argument is made that is still not enough, that we should be
funding this to the full authorized level. I have been around this
place for 11 years and I think I understand we do not fund at
authorized level and everyone in this institution understands the
authorized level is a statement, not a number. It is a goal. But it is
not necessarily the goal that will be reached.
What proves that beyond any serious doubt is the fact when the
Democrats did control both the Presidency, the House and the Senate,
they did not fund title I at full authorization. If there is
credibility to their argument today, they would have had to have funded
the authorization at its full level back when they controlled the
Congress. But there is not credibility to their argument because they
did not do that.
In fact, when we look at the level of funding increases that occurred
during their administration when they had the Presidency and when they
held the Senate, it was pretty much flat funded, and it has only been
with President Bush that the dramatic increases in these accounts
happen.
Do we have enough money in the pipeline to address title I and No
Child Left Behind? That is an argument we hear a lot about. We do know
the number has increased dramatically. States are getting a lot more
money. In fact, a lot of states are not pulling down the full amount
they have available to them. We know there is some good anecdotal
information coming in right now that says No Child Left Behind is being
adequately funded.
I was interested to see a recent study by two public officials in
Massachusetts, one of whom was the Massachusetts State school board
chairman and another who was a member of the school board in
Massachusetts. James Peyser is chairman of the Massachusetts Board of
Education and Robert Costrell is a professor of economics at the
University of Massachusetts at Amherst, on leave, and currently serves
as the chief economist for the Executive Office for Administration and
Finance.
These two gentlemen did a study of how much money was coming in under
No Child Left Behind and whether it was adequate. The report says they
thought there was sufficient money in the pipeline in Massachusetts to
effectively implement the law.
Here are a few things they cite: The $391 million of Federal
Department of Education money that has been set aside specifically to
administer the additional State assessments required under No Child
Left Behind is more than adequate.
That was their conclusion.
They did say:

Although new funding may be needed in the future, the
authors observe that ``The needed dollar amounts are
relatively small and could be met easily by allocating funds
from lower-priority problems.''

Another finding:

Shortfalls in federal support of school technical
assistance, as required under No Child Left Behind, are small
at present but are likely to grow significantly as more
schools are found to be in need of improvement. To fill the
gap, the authors call for greater flexibility in federal
guidelines. ``Much of the gap can be filled,'' Peyser and
Costrell explain, ``by allowing states to allocate more of
their federal dollars to supporting turnaround efforts in
low-performing districts.''

The estimated cost of testing required by No Child Left Behind runs
at

[[Page S2479]]

$20 per student, a small fraction of the per-pupil cost in the United
States. Today, the per-pupil cost in the United States is $7,392.
Interestingly enough, if you take the $391 million that the Federal
Department of Education has set aside--and this is not their numbers--
to do the assessment work, you find it exceeds the $20 by a rather
dramatic number. I know in New Hampshire, for example, it exceeds it by
a factor of almost 10. In fact, the dollars increased per pupil from
2000 to 2004 in Federal spending, these two gentlemen discovered, was
about $300 per pupil across the country, which certainly far outstrips
the cost of the per-pupil testing requirement, which is the primary
requirement in this law.
So you have folks who are very intimately involved in this business
in Massachusetts concluding that the funds which are flowing, which
have represented a very significant increase in funding--as shown by
this chart, $13.3 billion right now under this budget--more than
exceeds what is needed to efficiently deal with the No Child Left
Behind requirements.
One of the reasons we hear a lot about No Child Left Behind not being
funded I think is that most States and school districts today are under
significant pressure. But the pressure is not coming from No Child Left
Behind; the pressure is coming from local property tax burdens and
State revenues.
We have gone through a recession and those States have contracted in
their revenues. Property taxes have gone down. As a result, school
districts find themselves under pressure. I do not deny that. Everybody
recognizes that. But because money is fungible, people easily identify
the Federal dollars as being less than what are required to fund what
traditionally would have been cost driven by and funded by local
property taxes and State dollars.
The No Child Left Behind function is well funded. In fact, in this
bill we have increased it again. It is up another $1 billion
specifically have increased special education funding in this bill by
$1 billion. We have done that, by the way, without repealing the child
tax credit. In fact, we plan to extend that. We have done that without
requiring parents--people who are married--having to pay more in taxes
by not extending the marriage tax penalty relief language. We have done
it by retaining the 10-percent expansion so low-income people pay much
less in the way of taxes. All of that would be at risk--all three of
those areas--were the $17 billion of new taxes, which this amendment
represents, to be adopted.

I do not believe this amendment is legitimate from a standpoint of
addressing the concerns of No Child Left Behind. I do not believe it is
consistent with what happened in this Congress when the Democratic
Party controlled the Presidency and the House and the Senate. It
requires full funding of an authorization level, which was not done at
that time.
I do believe it would have a huge detrimental impact, potentially,
especially on married women and men, as a result of its ironic identity
with the cost of extending the marriage penalty, which is $15 billion,
which is essentially the amount of taxes this bill would raise.
I believe it is hard to defend this amendment either on a substantive
ground that it is going to make No Child Left Behind work better or on
a policy ground that it is consistent with historical actions in this
Congress--funding full authorization--or on the ground that raising
taxes makes good sense because I do not think you can support raising
taxes, especially when it might have such a dilatory effect on married
people or people with children. Therefore, I strongly oppose this
amendment.
Mr. President, I would yield to the Senator from Louisiana on her
time.
Mrs. MURRAY addressed the Chair.
The PRESIDING OFFICER. The Senator from Washington.
Mr. GREGG. Mr. President, I think the Senator from Louisiana had a
question. I yield to the Senator from Louisiana, but I ask that the
time for this question be taken off the side of the Democrats.
The PRESIDING OFFICER. Does the Senator from Washington yield time to
the Senator from Louisiana to ask a question of the Senator from New
Hampshire?
Ms. LANDRIEU. I would be happy to ask the question, but I think the
Senator from Washington would like to ask the question, and then I
assist her in that.
Mr. GREGG. Mr. President, I have not yielded the floor yet.
Mrs. MURRAY. Then, I will yield time to the Senator from Louisiana to
ask the Senator from New Hampshire a question.
The PRESIDING OFFICER. Is that acceptable to the Senator from New
Hampshire?
Mr. GREGG. As long as my answer is also coming off the time of the
Senator from Washington.
Mrs. MURRAY. No, I will not agree to that.
Mr. GREGG. Then, Mr. President, I reserve the remainder of our time.
The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Mr. President, the Senator from New Hampshire has strewn
a number of arguments across the floor that need to be responded to.
Every one of them has a very legitimate, responsible answer.
I used to teach preschool, and I am reminded of the kids who came in
and threw all their toys on the floor and then trying to figure out
which one to pick up first to try to make it look better. Frankly,
there are so many arguments out here that I want to respond to--and I
know the Senator from Louisiana wants to respond to--but every one of
these arguments can legitimately and clearly be denied.

First, let me respond that this amendment does not raise taxes
despite the rhetoric from the other side. This amendment closes
loopholes, just as the Republican budget requires within itself in
order to pay for this. That is legitimate. It is not raising taxes. It
is closing loopholes. I think it is an argument all of us in the
Chamber understand.
Senator Landrieu has been listening carefully to the Senator from New
Hampshire on his argument about funding and funding increases, and she
is going to respond to that. I will yield her time to do that.
But let me point out, when President Clinton came into office in 1993
and 1994--and the Republican chart that was up only talked about 1993
and 1994; it did not talk about the tremendous increases later--the
President's No. 1 priority at that time was to balance the budget,
which was extremely out of whack. President Bush, when he came into
office--and that chart was showing us the numbers of increases at that
time--his No. 1 priority was to cut taxes. That is the difference.
I remind my colleagues on the other side, the reason the budgets for
education were increased is because Democrats demanded it. I know they
have forgotten this, but Democrats were in control in the Senate from
about June of 2001 until January of 2003, when much of those increases
were in place, because we came to the floor and said it needed to be
done.
I know my colleague, Senator Landrieu from Louisiana, is here. I
yield to her such time as she needs to respond.
The PRESIDING OFFICER. The Senator from Louisiana.
Ms. LANDRIEU. Mr. President, I thank the Senator. I appreciate the
leadership of the Senator from Washington.
I am sorry the Senator from New Hampshire has left the floor because
I do have about five points to make.
The first point I want to make is, while I respect his leadership in
education, and while I think he has absolutely put the best spin
possible on the situation that we face, I would say, in Louisiana, that
dog just won't hunt.
Those numbers don't add up. His charts do not tell the true story.
People in Louisiana and throughout this country are very anxious right
now because what they want to hear is the truth, the whole truth, and
nothing but the truth. While I am not saying those specific numbers
were not correct, the truth is not just about giving the specific
numbers; it is about the whole picture.
I will begin with the truth and the facts to put it in reference. I
wish they would put the chart up, but they may not because they will
not be able to defend it. But if they would put the chart back up that
shows the years they put up there--1993, 1994 and 1995--the Senator
said when the Democrats were in charge in 1993, 1994, and 1995, we did
not

[[Page S2480]]

have that much of an increase in education. That is true.
But what is also true is that the previous Republican administrations
had left this country in such debt and in such despair and the deficits
were so high that we could not contribute money to any program of any
substance because the country was going broke.
So it is true we could not spend that much money on education because
we had to take care of the deficit, this big red line. So we had to cut
back.
Although Republicans say the Democrats don't know how to cut back and
Democrats never will cut budgets, that is absolutely not true. We,
under good and solid leadership, started trimming back. And we had to
raise some revenues to get the country back into surpluses. When we did
get back into surpluses, the budget numbers will reflect that there
were increases made by the Clinton administration in education.
I will submit this document for the Record. It is a little scratched
up and it is not very clear. I am sorry I don't have it in big print.
But it will be put in the Record. If anybody wants to argue about this
page, they are more than welcome. This is the official document of the
U.S. budget. Nobody will refute these numbers. They are all right here.
What they say is that there were increases of 15 percent, 12 percent,
12 percent, 6.2 percent, 12 percent, 18 percent. It is true that as we
got surpluses, we gave more money to education. But what is also true
is this budget, which Senator Murray is trying to amend but the
Republicans won't allow it, is saying that this budget, then, with
these surpluses, wants to take some of that surplus money and commit it
to education. This budget says, no, we are going to commit to it tax
cuts, all to tax cuts, and no money to education.
In addition, when President Bush came into office, which was 2001,
although we had increased funding for education as the condition of the
country improved and we were doing as much as we could, the truth is,
the President came into office and said: Even though we are increasing
money to education, the past administration didn't do a good job, and
I, as the new leader of the country, am going to put in a new law. We
are going to step up the requirements and we are going to have
accountability. If we do that, then I will fund those new efforts. As
you know, he and the Republican leadership have decided they are not
going to fund it. They are going to provide tax cuts.
Let me talk about pressure. I know the Senator from New Hampshire,
who was Governor and is now Senator, understands pressure. I don't know
exactly what he was talking about. Maybe he could clear this up.

But when I supported No Child Left Behind, 40 percent of the teachers
in Louisiana were uncertified and their average salary was $27,000 a
year. We are one of the lowest in the country. But when that law was
passed, a mandate was put in that all of those teachers had to be
certified by next year, 2005. We are in 2004. I don't know if the
Senator from New Hampshire thinks that is not pressure, but let me tell
you, my superintendents are feeling some heat. My legislature is
feeling some heat. I am feeling some heat in a good way, because 40
percent of the teachers in Louisiana aren't certified. In this budget,
which promised to help train them, help increase their skills, help
recruit them, the funding is not there to do it. That is what I call
pressure.
Let me talk about the pipeline for a minute. The pipeline issue came
up because our Secretary of Education, supported by this
administration, after calling all the teachers in America and one of
the leading organizations a terrorist organization, which he has
apologized for but a lot of people don't think the apology went far
enough, after calling them terrorists, he appeared before the committee
and said, from a letter:

States are not fully utilizing the Federal education funds
available to them in a timely manner, allowing billions of
dollars to remain in the federal Treasury instead of
improving education for our children.

He has put in writing, for this administration, a charge to every
Governor, every superintendent, and every administrator across the
country basically telling them, I don't know what you all are
complaining about, because you have a lot of money.
Wait until you see the reaction that is going to happen across the
country. It starts with the superintendent of Iowa who has gone on
record as saying:

The implication that we have let huge sums of federal money
languish, that the funds are at our disposal to use at our
discretion, or that we have not been good stewards of the
public money is not only unfair, but it is patently
insulting.

If this administration, the Republican leadership, wants to continue
to insult everyone in America who is trying their best across party
lines, across racial lines, across geographic lines to improve
education, if they want to keep putting out insults such as this, they
may go right ahead. But that dog doesn't hunt. The arguments won't
stand. The facts do not justify the story that is being told.
I am going to conclude with this. The facts are these: When the
country was in huge deficits, which the Republicans, in large measure,
were responsible for because of their irresponsible policies,
everything had to be cut back. And as soon as the surpluses started to
appear, which was a good thing and everyone worked on making that
happen, we said: Let's set a new course for education and invest money
but not just throw money at the problem. Because I agree money is not
the solution, but let's have accountability and we will find results.
We started down the path. We believed the administration. We pressed
on, and then the rug was pulled out from under our feet. That is what
this budget is about. That is what Senator Murray's amendment is about.
I am proud to be a cosponsor of it and that is the truth.
I ask unanimous consent to print the following material in the
Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

DEPARTMENT OF EDUCATION, DISCRETIONARY SPENDING
[Program level--in millions of dollars]
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
2005
1993       1994       1995        1996        1997       1998       1999       2000       2001       2002       2003       2004    President  2001-2005($)  2001-2005
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Program Level.................................................  .........     24,709     24,712       23,036     26,645     29,903     33,521     35,606     42,231     49,936     53,114     55,662     57,339       15,108       35.8%
Budget Authority..............................................  .........     24,709     24,712       21,738     26,645     29,753     28,765     29,363     40,097     49,506     53,114     55,651     57,339       17,242       43.0%
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Difference..................................................  .........          0          0        1,298          0        150      4,756      6,243      2,134        430          0         11          0  ............  .........
Program Levels
Enacted (plus 2005 President)...............................  .........     24,709     24,712       23,036     26,645     29,903     33,521     35,606     42,231     49,936     53,114     55,662     57,339  ............  .........
Change from previous year ($)...............................  .........        858          3        -1676      3,609      3,258      3,618      2,085      6,625      7,705      3,178      2,549      1,677  ............  .........
Change from previous year (%)...............................  .........      3.60%      0.01%       -6.78%     15.67%     12.23%     12.10%      6.22%     18.61%     18.24%      6.36%      4.80%      3.01%  ............  .........
4 year average (1997-2001)..................................  .........  .........  .........  ...........  .........  .........  .........  .........     12.20%  .........  .........  .........  .........  ............  .........
4 year average (2001-2005)..................................  .........  .........  .........  ...........  .........  .........  .........  .........  .........  .........  .........  .........      7.95%  ............  .........
President's Requests
Program Level.................................................  .........     26,753     26,281       26,378     25,829     29,686     32,601     34,685     40,088     44,541     50,310     53,139     57,339  ............  .........
Request vs. previous enacted year ($).......................  .........      2,903      1,572        1,665      2,793      3,041      2,698      1,164      4,482      2,310        374         25      1,677  ............  .........
Request vs. previous enacted year (%).......................  .........     12.17%      6.36%        6.74%     12.13%     11.41%      9.02%      3.47%     12.59%      5.47%      0.75%      0.05%      3.01%  ............  .........
Enacted vs. Request ($).....................................  .........     -2,044     -1,569       -3,342        816        217        920        921          2      5,394      2,804      2,523          0  ............  .........
Enacted vs. Request (%).....................................  .........     -7.64%     -5.97%      -12.67%      3.16%      0.73%      2.82%      2.66%      5.35%     12.11%       5.6%       4.7%       0.0%  ............  .........
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Ms. LANDRIEU. I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Mr. President, I understand the Senator from Wyoming is
on the floor. I want to set up some

[[Page S2481]]

time allotment for our side so we can go back and forth. Under our
time, I yield 10 minutes to the Senators from Delaware, 5 minutes to
the Senator from New Mexico, and 10 minutes to the Senator from
Minnesota. We will alternate time with the other side as they require.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CARPER. Do I understand that Senator Biden and I have 10 minutes
to divide among ourselves?
Mrs. MURRAY. The Senator has 10 minutes. I assume that is equally
divided. If you need more than that, I am happy to yield it.
Mr. CARPER. What I would like to do is have maybe 5 minutes to talk
on your amendment, and then Senator Biden and I wish to welcome some
special guests.
Mrs. MURRAY. That is fine. I will yield the time on my side to allow
them to do that.
Mr. CARPER. I thank the Senator.
I will say a word, if I can, in support of Senator Murray's amendment
to fully fund No Child Left Behind.
In 1995, the Congress passed, with the urging of many Governors,
unfunded mandate legislation that said Congress and the Federal
Government should not tell the States what to do and then not provide
the money to do it. The Federal Government should not be taking money
away from States without providing an offsetting amount of revenue for
the money taken off the table for the States.
If we fail to adequately fund No Child Left Behind, yet at the same
time mandate higher performance requirements in classrooms, whether it
is in Delaware, Washington, New Hampshire, South Carolina, or in New
Mexico, we are putting in place an unfunded mandate. I have been
visiting a number of schools in my State over the last couple of weeks.
What I have asked is, what have you done with the extra money we have
given you as a result of No Child Left Behind? I got some interesting
answers.
A lot of the money is being invested especially in title I increases,
in early childhood. We are seeing some remarkable results. These
children who are doomed to fail, instead of going on to failure, have
age 3 and age 4 quality prekindergarten programs, and age 5 full-day
kindergarten programs, and extra learning time that follows beyond
that, and there are remarkable results.
By the time these kids are in the third grade, they are doing
basically as well as the kids coming from places where we expect
success. We are cutting in half our revenues to special education. I
urge my colleagues to support the amendment proposed by our colleague
from Washington to fully fund No Child Left Behind.
I will add a few comments to that, if I may. Every minute, the Bush
administration spends $991,000 more than it takes in--every minute.
During the 2 minutes I have been talking, we have spent about $2
million more than we are taking in.
In 2001, the first year I was here, and when George Bush was
President, he said:

We can proceed with tax relief without fear of budget
deficits.

He was wrong.
He said:

Our budget will run a deficit that will be small and short-
term.

He was wrong.
In 2003, he said:

Our current deficit is not large by historical standards
and is manageable.

He was wrong.
Now he says:

The deficit will be cut in half over the next 5 years.

He is wrong again.
My friends, our budget deficit this year is going to be about a half
trillion dollars. When you actually take away the surplus funds from
Social Security that mask the Federal budget deficit, it is even larger
than that. While there is a little downtrend starting this year for a
couple years in the budget deficits, the real budget deficit, the
operating deficit, is about $450 billion. Then it climbs steadily up.
The boomers, my generation, will begin to retire, and we are looking at
a budget deficit for 2014 of about $785 billion. That is three-quarters
of a trillion dollars. Those are operating deficits, not debt.

I wish we had a chart of the debt. We do.
In 1962, I was a 15-year-old kid growing up in Danville, VA. It is
hard to see the red ink down there on the chart because it wasn't very
much. It was less than a trillion dollars; it was a couple hundred
billion dollars. In 1982, we hit $1 trillion. In 2003, last year, we
exploded up to about $6.8 trillion. You can see this leveling off from
about 1998, 1999, and 2000. That is what happened in the last
administration and in the very beginning of this administration.
What happens now, starting in 2003, is the debt--real debt, how much
we are borrowing as a country from the Bank of China and banks in
Japan, and from people all over the world--goes from where it is today,
about $7 trillion, to in 2014 some $15 trillion.
There are going to be about 29 or so babies born in Delaware today.
They are going to be facing something I call a birth tax. Some of my
colleagues on the other side talk about a death tax, which is their
term for the estate tax. I am talking about a birth tax. For every baby
born in my State today, they will face a debt of $35,000 apiece when
they come into the world. So do their brothers and sisters and parents
and grandparents. By 2009, it is going to be over $35,000. That is the
kind of welcome to the world we are giving children in my State, and
other States as well.
The fastest growing entitlement program in the Federal budget is not
the Medicare plan or Social Security or Medicaid. The fastest growing
entitlement program in our Federal budget is servicing our national
debt, as you can see from the last chart I shared with you.
In 2009, our Federal Government will spend some $1.5 billion per day
in interest on our national debt. In 2009, the Federal Government will
spend more money servicing the debt than we spend on the entire defense
for our country.
I will say that again. In 2009, we are going to spend, if we stay on
this track, more money servicing the Federal Government's debt than on
defending our Nation.
Let's get real. I don't have the time to go through this entire
chart, but this is instructive. The debt we are going to have this
year--about $521 billion--is actually more than all of our nondefense
discretionary spending. We could get rid of the EPA, the housing
programs, the education programs, and homeland security on the
appropriations side--everything but defense--and we would still have a
deficit of about $55 billion or $56 billion.
There will be a vote later this week, beyond the vote on the Murray
amendment. I think it will be offered by Senator Feingold of Wisconsin.
It speaks to getting real. There was a time not too long ago when we
were real. When somebody came to the floor and said, I want to raise
spending by some magnitude, they had to come up with an offset. If they
wanted to raise spending, they had to cut spending someplace else or
raise revenue by that amount. Similarly, if I or anybody else wanted to
come here and say, let's cut taxes by some amount of money, we had to
come up with an offset. That is common sense in my State. That is just
common sense. We used to do business that way here.
A couple of years ago, those pay-as-you-go rules lapsed. We need to
reinstate them. We have the opportunity to do that this week. In an
hour or so, we are going to vote on the Murray amendment to avoid an
unfunded mandate and make good to those kids born in Delaware today and
around the country so they are not saddled with a huge debt to face for
the rest of their lives, and to give them a chance to be successful in
school and in life.
The PRESIDING OFFICER (Ms. Murkowski). The senior Senator from
Delaware is recognized.
Mr. BIDEN. Madam President, I am told we used up a lot of the time,
necessarily. I ask unanimous consent to have an additional 5 minutes.
The PRESIDING OFFICER. Is there objection?
Mr. GREGG. Reserving the right to object, I didn't hear that.
Mr. BIDEN. Earlier the distinguished Senator from Washington yielded
to Senator Carper and me to allow us to both acknowledge support for
her amendment and then a total of 10 minutes of morning business to
speak to another issue.

[[Page S2482]]

The PRESIDING OFFICER. There is 1 minute remaining of that time.
Mr. BIDEN. Madam President, I ask unanimous consent that my
colleagues would permit an additional total of 10 minutes, divided
between the junior Senator from Delaware and myself.
Mr. CONRAD. I am happy to yield that time.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The remarks of Mr. Biden and Mr. Carper are printed in today's
Record under ``Morning Business.'')
The PRESIDING OFFICER. Who yields time?
Mr. GREGG. I yield to the Senator from Wyoming such time as he may
consume.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. ENZI. Madam President, I rise in opposition to the amendment. I
really appreciate the comments of the Senator from New Hampshire where
he went over the No Child Left Behind legislation and what it really
does. The No Child Left Behind legislation is to get kids to be able to
read and do math, hopefully by the time they are in third grade but
definitely by the time they graduate from high school, and to have some
confidence in it. Every State has the right to set their own standards
and they have to follow them, but the idea is to get them to do reading
and math.
We held some hearings in Wyoming. I had the Department of Education
come to Wyoming and talk about some of the rules and there were
concerns about the law and some of the ways it affected Wyoming. We are
a very rural State. We have a large State. We have very small
populations. We have some different classrooms than in other places and
we needed to be sure when the rules were written they would work for
Wyoming, which has a very tough law that was already in place before No
Child Left Behind even came along.
It has increasingly difficult standards that have to be met over the
next several years, and they adopted that as their No Child Left Behind
standards. I do not want people to have the impression No Child Left
Behind forced the States to do all of these things. Yes, it did force
some of the States to do some of these things, but a lot of the States
were already doing things to make sure no child got left behind.
I appreciate the President joining those States and encouraging in a
very forceful way the other States to do that, too.
Incidentally, I had people drive as far as 200 miles to come to one
of these hearings and we are going to hold two more of them in Wyoming
yet. But I did have one person stand up and say there is not anything
in No Child Left Behind about improving physical education and that is
very important. If people are not healthy, they cannot do well in
school.
I pointed out there also is not anything in No Child Left Behind that
says they have to have competence in science until several years from
now, and that is very important. We are starting with some very basic
points. If a child cannot read and do math, they do not stand much of a
chance. Their choices in life are very limited, and the President
recognized that.
He did not say: On the average, we want everybody to be able to read
and do math. He said: I want every child in this country to be able to
read and do math.
That is where we are starting. Now, we have places we can go with
that, science will be added in, and other things can be added in, but
we are trying to do something very basic. We also get the impression
from this discussion the Federal Government provides all of the money
for education. That is not true and it never was true. I do not think
it was ever intended to be true. We used to provide about 7 percent of
the education dollars in the United States. The local people provided
the rest of it.

It always fascinated me that for the 7 percent in education funding
we provided, we caused 50 percent or more of the paperwork. Yes, we
really tie a lot of things to our money that does not have anything to
do with local control. It has to do with jobs in Washington because if
we have a lot of reporting that has to be done, somebody has to make
sure those reports are filled out.
I had a school superintendent who came out for one semester. He spent
some time in my office, and actually I had him go down to the
Department of Education and look at where his reports were going and
what was done with them. He was fascinated to find out they read all of
them. He was tremendously disappointed to find out that is all that
happened to them, and he did not see why we were filling out reports
that just provided people with a job to make sure the report was
complete.
There is a lot of room to eliminate paperwork. That would save time
and money at the local level, which is absolutely essential.
I also wish there was more in the bill that dealt with parental
responsibility. When the parents are involved in a child's education,
the child does better. Again, we focused on reading and math and what
the schools could do because that is where the money goes.
We held a hearing last week and one of the people present mentioned
that in one area of the country, Washington State, there was a high
school that forced the parents to sign up the courses for the kids.
That is a fascinating concept. Kids in high school can go sign up for
their own courses, and when they do they will say: This one looks easy,
and this teacher is easy for an A, and I like doing this because it is
a little more outdoors. But when the parents look at it, they say: I
want my kid to excel and these are the things he or she will have to do
or be able to do to excel in the school. It makes a whole lot of
difference in what the kids take. The biggest difference is the parents
have to pay attention to what they want their kids to be able to do and
make sure the plan they are signing their kids up for will make that
kind of progress.
In the discussion over our priorities on the current budget, my
colleagues continue to suggest funding for education is being ignored.
Well, we have had some charts that show it is not being ignored; it has
been greatly increased under the Bush administration.
We had a fascinating display of a chart on the other side that gave
the impression the reason the Clinton administration had declining
amounts going into education funds was because there was a deficit and
they were trying to overcome the deficit. I remember when I arrived
here 8 years ago we were trying to force that balanced budget
constitutional amendment. We failed by one vote, but it had a positive
effect. The positive effect was both sides of the aisle understood we
needed to do a better job on balancing the budget, and we did. That
helped grow the economy, and the economy's growth is really what
provided the money. We did not cut programs. We increased programs. We
did not eliminate programs. We added new programs. The growth of the
economy kept ahead of the spending.
There have been a number of things that have affected the economy
lately, but a very important part of this discussion is, we are on the
U.S. budget. We are not appropriating. We are not doing Finance
Committee work of figuring out what the taxes should be. We are doing a
budget. The purpose of a budget is to set targets. Maybe that is not a
good word to use on this floor, but I think it is a very important word
to use. It reminds me of a cartoon that I saw of a grizzly bear that
had this big target on his chest, and the other bears gathered around
and said: Oh, rotten birthmark, rotten birthmark.

Targets are important, and all the budget does is set targets up. We
do not shoot at them. We do not decide how big the rings are going to
be. But we set targets up.
Now, if my colleague will listen to the debate we are having,
sometimes we are suggesting the target be moved a little higher.
Sometimes we suggest the target be moved a little to the left.
Sometimes we suggest the target be moved a little to the right. Listen
carefully and see if anybody ever suggests moving the target down. No.
That is not good politics. It is important politics, but it is not good
politics.
What we are going to do is set the budget, the targets. Once those
targets are set, the authorization committees get to work with them.
They are the ones who actually work with the rings of the budget. They
decide what the priorities are and how big each of those ought to be,
and then the money gets turned over to the Appropriations Committee.
They are the first ones

[[Page S2483]]

that get to shoot at the target. When that comes to the floor, we get
to shoot at the target. Everything before that is setting up targets.
A lot of the discussion we have heard this morning is based on three
assumptions I believe are mistaken. The first assumption of my
colleague from Washington State is that raising taxes, by repealing
some or all of the recent tax reductions, will not have a negative
impact on the economy. I noticed that the discussion changed a little
bit to loopholes, and it was pointed out that in the budget there are
some loopholes. We talked very specifically about some loopholes, how
big those loopholes are and whether they could be achieved in the
budget assumption. I think in order to add to that, a person would have
to figure out what those other loopholes are. There is a limited amount
of loopholes. There are some real ones that can be identified. They can
have a price put on them. But if that is not done, what is being talked
about is the common campaign tactic of saying we are going to take it
out of waste, fraud, and abuse.
Yes, probably in many of the Government programs there is waste,
fraud, and abuse. If you add it up, there is a limited amount of it.
Finding it and eliminating it is a whole other problem. The same with
loopholes.
So when they talk about the money here, they are talking about
raising taxes, which would repeal all or some of the recent tax
reductions, and it would have an impact on the economy.
The truth is, a tax increase would hurt economic growth, which is the
most important factor in terms of revenue. I mentioned that how we were
actually able to come up with surpluses was growth, not reducing
programs.
The second assumption my colleague is making is that the Federal
Government is somehow responsible for creating new jobs. As a former
small business owner, I know firsthand that expanding Government is not
the best way to create jobs. Taxing small business is not the best way
to create jobs.
We keep talking about these rich people out there. A lot of those
rich people are not rich at all. They have businesses and, because they
are single proprietorships or partnerships or subchapter S
corporations, whatever profit shows up on the balance sheet goes to the
bottom line on their taxes. It is considered to be money they have
earned on which they need to pay taxes.
But having been a small businessman, this is how that really works.
Yes, your business shows a profit at the end of the year. Yes, it is
honest accounting. But you don't get to take the money out. Hopefully,
you have a growing business, and a growing business needs ever more
amounts of revenue. That is what the big corporations do, too. Their
profits don't get paid out every year in the way of dividends. They
stay in the corporation to grow the corporation.
The difference is, if you are a regular corporation you pay a small
tax on the money that stays in there. When the dividend gets paid out,
there are additional taxes that get paid on it. So it is not very
appealing to the small businessman to use that form of corporation. But
if they go with the subchapter S, or single proprietorship, there are
some advantages to that, but the big disadvantage is they pay the tax
in the year the balance sheet shows they earn it and they don't get to
take that out.
When we are talking about raising taxes on the rich people in this
country, that is a nice phrase people like to use but most of those
business owners I know don't consider themselves to be rich. They do
consider themselves to have a good business and they are employing a
lot of people.
When we are talking about businesses, we are talking about small
businesses, we are talking about 90 percent of the businesses in this
country, and we are talking about the vast majority of jobs in this
country. I can tell you for a fact when somebody works for a small
business, they understand how tenuous their job is. They understand how
fragile some of these small businesses are. They don't have the vast
market to fall back on. If there is a small change in their market, it
can mean the end of their job; the same as a change in taxes can make a
difference in whether that person stays in business or goes to work for
somebody else, abandoning the business and losing jobs.
When we are talking about taxes, we have to keep that in mind. The
Federal Government can leverage resources. We were talking about job
training, too. They can leverage resources to help train individuals
for available jobs, but job creation is something done best by the
private sector in this economy and it functions best when the Federal
Government is not taxing these small businesses beyond the point where
they are sustainable.
It has been interesting. When we were back in the times of the mega
mergers, when the big companies would combine together to form an even
bigger company, and then have what they called a downsizing, or a
``right sizing''--that is when they would lay off 6,000 or 9,000
people; I called it laying people off--when that happened, the small
businesses of the country picked up those employees. So it is not the
big businesses of this country that do the job for us; it is the small
businesses in this country. And a change in taxes affects those small
businesses.
I am also confused as to why my colleagues argue for additional
funding for programs that they argue will help generate jobs, yet they
continue to oppose naming conferees to the Workforce Investment Act,
which would help train individuals for jobs that are already available.
The Workforce Investment Act passed last year. Senator Murray and I
worked on that, along with Senator Kennedy. We got it out of committee
unanimously. We got it through this body unanimously. Now we can't name
a conference committee. Until a conference committee is named and we
can work out the differences with the House, improvements to that bill
are not available.
Training for 900,000 people is in jeopardy. Training for people who
could upgrade their skills to fill in the kinds of jobs that are
available in the country versus the jobs they are trained for. It is
900,000 jobs a year and we can't have a conference committee to get
that done. It makes more sense to me that we would try to fill the jobs
that are available now rather than spending more Federal dollars to try
to create jobs.
The third assumption my colleagues are making is that this Congress
is not maintaining its commitment to education. I would like to point
out to my colleagues that under this Federal budget resolution, Federal
education funding will be at its highest level in history. It will come
close to doubling since the year 2000--doubling. We doubled the
National Institutes of Health's budget over a period of about 8 years,
but this President has nearly doubled the education budget since 2000--
nearly doubled it. It amazes me.
The opposition, of course, is upset with that because this President
has had the audacity to take the leadership on education. Leadership in
education used to be from the other side of the aisle. But this
President said, We are going to do it, and he put the dollars behind it
to do it. It amazes me that, despite these increases every year, we
hear about how this administration and the current congressional
leadership failed to support adequate funding for educational programs,
particularly title I of No Child Left Behind.
The truth is, these programs have seen enormous increases over the
past 4 years. Even so, my colleagues assert that we are somehow
undermining our commitment to education.

I am reminded of the debate this body had over last year's budget
resolution. We heard over and over from our minority colleagues that
the Federal commitment to education was too small. Despite all of the
discussion surrounding our failure to support education funding, the
current Senate leadership has increased spending for title I and other
educational programs more than any other Congress in history. Yet my
colleagues argue that is insufficient. They argue we need to raise
taxes to support more education spending.
What is the impact of all this new spending on education? State and
national studies show that funding for No Child Left Behind is
adequate. I would like to remind my colleagues from Massachusetts that
a study in their State suggested that more than enough funding is
available for implementation of the law. Opponents of the budget
resolution might suggest that other

[[Page S2484]]

States have found that funding for No Child Left Behind is insufficient
and that more money is needed. Many of these estimates are based on
some risky assumptions. Some of these studies are anticipating costs
more than 10 years into the future.
As an accountant, it strikes me that these studies are missing the
point, because they are suggesting that current funding is inadequate
for challenges that are not even going to appear for 5 or 10 years in
the future, if they appear at all.
I asked for some information about the title I grants for local
educational agencies to see what kinds of increases we have had between
2001 and 2005. I was fascinated to see Louisiana, which has been part
of the discussion this morning, had a 46.9-percent increase in
funding. Massachusetts got a 24.1 percent increase in Title I. New York
got an increase of 65.2 percent. Rhode Island got an increase of 76
percent. Washington State got an increase of 47.9 percent.

The Senator from Louisiana also mentioned they didn't have enough
money. It is kind of fascinating to me that out of the discretionary
funds, those that weren't used reverted to the U.S. Treasury. I have
the list by State. Louisiana surrendered 6.37 million to the United
States Treasury. All together more than $154 million was returned to
the Treasury. All of it isn't being used.
I spoke to one Wyoming superintendent. He said the biggest problem
with title I was they needed more flexibility to be able to shift that
money to salaries because they already have all they can possibly buy
with title I. I thought that was interesting.
I also would like to point out to my colleagues that the ``wealthy''
individuals who would be paying for these increases couldn't possibly
afford to fund all the additional spending my colleagues in the
minority are recommending. They would have to earn much more than $1
million a year. As my colleague from Utah has pointed out repeatedly,
it is the small business owners who will be paying the bulk of these
taxes.
I don't believe you want to send the message to the people who
managed to achieve the American dream and finally have financial
security that the Federal Government will then turn to them and ask
them to surrender a much larger portion of their income and call it
their ``civic duty.'' I shouldn't have to remind my colleagues that the
highest tax rates in this country already apply to the wealthiest
Americans. The graduated tax scale relies largely on the wealthiest 10
percent of Americans for most of the Federal Government's revenue
already.
The ``wealthiest'', as I have explained, are the people who are
business owners who are putting most of that back into a business. My
colleagues are suggesting these Americans don't contribute enough and
if these Americans were truly interested in their country's well-being,
they would agree their taxes should be even higher. I think that is
simply ridiculous.
I don't believe the tax increase is the only option we should
consider. We are discussing a budget that would provide $814 billion in
discretionary spending. My colleagues are saying that simply is not
enough money.
Reflecting on my experience as an accountant again, when a company is
running deficits there are two things that can be done: They can raise
revenue or they can cut spending. This body has shown an insatiable
appetite for new spending, but there is a genuine lack of support for
reductions in spending. We talk about tax loopholes, we talk about
fraud, waste, and abuse, and we talk about tax increases, but we don't
talk about truly cutting because we haven't got the will to do it. Even
when we talk about increases, it is not enough.
I mention the targets we put up for the budget, the targets the
appropriators actually see. We talk about raising them, moving them to
the right or moving them to the left, but never lowering them.
In the President's budget, there was some tremendous leadership. The
President actually suggested cutting some programs. Why did he suggest
cutting programs? He suggested it because Congress imposes on the
Federal Government the Government Performance and Results Act. We said
every federal program in this country has to do a report every year. In
that report they have to show what their application is, what their
goals are, how they are going to accomplish it, and how that fits with
the money they are spending. They have to tell us what the job is they
are doing and how they are getting it done.

It might be interesting to people who are listening, that in some of
the agencies some of their programs failed those reviews. They aren't
doing what they said they would do. According to the reports those
people are writing, they are not doing their job. The President said if
they are not doing their job, let us cut the program.
I can tell you that on the Budget Committee we did not do that. That
is not in the budget. We didn't cut any of those programs no matter how
bad the Government Performance and Results Act showed them to be. That
would have been $5.9 billion. I hear that is not enough to do anything,
but it would be a big part of what we are trying to do in this
amendment for education. We are not cutting those programs. We will
have constituents and interested people who will try to prove the
Government Performance and Results Act reports were absolutely wrong.
We need to have some courage to cut some things, to revise some
things, and to consolidate some things. That is what businesses would
be doing. Businesses have to make cuts when revenues go down unless
they can figure out a way to get those revenues to come up. They
usually do both. They try to figure out a way to get the revenues to
come up, but they also cut programs that don't work. They get rid of
products that aren't selling.
For some of those programs, the products are only selling to the
people who are employed by the programs--not to all of them. For some
of them, it was probably a gross error in writing their report. But if
we ever cut some of those, I would bet there would be a lot more
attention paid to their own reports on performance and goals. That is
something we ought to be doing.
Even under the current budget circumstances, my colleagues are asking
for even more spending. At what point can we say enough is enough? How
much Federal spending is adequate? I think I have said enough about
raising taxes and why this body must oppose any effort to finance
additional government spending by levying further taxes on our
citizens.
Discretionary education spending has increased by 64 percent since
2000. In real dollars, there has been more than a $13 billion increase
in discretionary program funding since 2000. Of that total, $4.5
billion has been in title I alone. More than enough has been dedicated
in spending to cover the mandatory expenses of the No Child Left Behind
Act. Additional increases are both unnecessary and irresponsible given
the current budget situation. As we speak, States are waiting on new
increases even though they have nearly $6 billion in unobligated
funding to them. Almost $2 billion of that total is title I funding. It
is time we stop taxing and spending to meet needs that have not
presented themselves yet.
I yield the floor and reserve the remainder of our time.
The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Madam President, I ask unanimous consent to add Senator
Sarbanes and Senator Bingaman as cosponsors of this amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
The PRESIDING OFFICER. The Senator from New Mexico is recognized.
Mr. BINGAMAN. Madam President, I rise in strong support of the
Murray-Kennedy amendment. This would fully fund the No Child Left
Behind Act. The question of how much money the Federal Government
should provide to local school districts to assist in meeting the goals
of the No Child Left Behind Act was something we discussed extensively
when the bill was being written. Many of us urged that those figures be
higher than they wound up being, but the authorizing legislation
contains figures which we think the Congress should honor and should
step up to and fund. That is exactly what this amendment would do. I
congratulate my colleagues, Senator Murray and Senator Kennedy, for
putting this amendment forward.

[[Page S2485]]

As I am sure has been discussed extensively, the core idea behind the
No Child Left Behind Act was we would require States and school
districts to establish what would be considered performance goals for
their students, that they would make what we call ``adequate yearly
progress'' in achieving those goals, and that the Federal Government is
committed to provide assistance in doing that. Unfortunately, we have
fallen short. Unfortunately, this President has not asked for the full
funding on that legislation in any year since it has been in effect.
Again this year, he has not asked for that funding. This amendment
would try to correct that problem. I believe it is a very meritorious
amendment.
I want to particularly spend my very few minutes here focused on one
particular program I have spoken about many times on the Senate floor.
It is very important in my home State of New Mexico; that is, a
provision in the No Child Left Behind legislation the President signed
which calls for the Federal Government to assist local school districts
in trying to keep kids in school. It was dropout prevention efforts by
the Federal Government to assist the local school districts in pursuing
those. The idea was, as you are requiring more and more of students,
teachers, and schools, there is a great temptation on the part of those
schools and those teachers to just say, let's look the other way and
allow some of these poorly performing students to leave school. That
way we can get our standards up and everyone will be happy.

Unfortunately, that has happened. It is happening in my State. It is
happening in many States in the country. We are not doing what we
committed to do--we, the Federal Government are not doing what we
committed to do in that legislation to assist schools in heading this
off. We committed in the legislation to provide $125 million per year
to assist in dropout prevention. This year, this current year, we are
providing $5 million--not $125 million but $5 million. Considering the
number of school districts in this country, the number of students who
are at risk of dropping out, this is a ridiculously low figure.
Unfortunately, if we are not able to adopt the Murray-Kennedy
amendment, we are going to be faced with a situation where when we come
to the Appropriations Committee, they will say there is no money to
fund this. It was funded at $5 million. Maybe we will continue to fund
it at $5 million again. Essentially, the Federal Government is going to
once again take a walk on any responsibility to assist with solving
this problem.
I believe firmly when we allow a student to drop out of school before
they graduate, we are leaving that student behind. We are leaving that
child behind. Clearly, we need to make a priority out of this. This is
a problem that particularly affects my State. We have a very large
Hispanic and Native American population. The graduation rates among
those groups are slightly better than 50 percent. That means we will
find half of the Hispanic and Native American students who started in
the 9th grade actually going through that graduation ceremony. That is
a terrible indictment of our education system. The least we can do is
put in the small amount that was contemplated when we wrote the No
Child Left Behind Act.
This is very important to schools throughout my State, to the larger
schools, also to the rural schools. I hope it is a correction that can
be made. I hope very much the Murray-Kennedy amendment is adopted so
the funds will be there to actually accomplish this objective.
I yield the floor.
Mr. KOHL. Madam President, I rise today in strong support of the
Murray amendment. I am proud to cosponsor this amendment, which will
finally provide the funding that Congress and the President promised
when No Child Left Behind became law.
I supported the No Child Left Behind Act because I believed it would
provide a real chance for real reform. For the first time, the Federal
Government would provide the resources that schools, teachers and
principals need to help all students succeed. And in return, we
required real accountability for results. Teachers, principals and
school boards are working hard to live up to their end of the bargain
as they work to meet the requirements of the new law. Now they are
counting on us to live up to our end.
Unfortunately, the President's fiscal year 2005 budget request--and
the budget resolution before the Senate today--fall far short. This
budget resolution falls $8.6 billion short of what was authorized under
No Child Left Behind. Just when we're asking schools to do more, this
budget resolution takes away the very funding they need to succeed.
It might be easy to dismiss this shortfall when you talk about it in
terms of billions of dollars. So I want to tell my colleagues here what
this shortfall in funding has actually meant for schools in my State of
Wisconsin. In 2003, Milwaukee Public Schools received an $8 million
increase in Title I funds. But the new requirements for supplemental
services and transportation for students to better performing schools
cost over $10 million. In other words, the new mandates cost $2 million
more than the total increase MPS received, and they had to make up the
difference. To cover the costs, they were forced to cut their popular
summer school program, which had served 17,000 students.
This is just one example. Across Wisconsin, school districts are
being forced to cut staff and increase class sizes, cut music, art and
foreign language education, and cut textbook purchases. Some have even
had to keep their schools colder during the winter months to cut down
on their heating bills, or restrict how many pages students can print
from their computers. These are certainly not the results we want.
Problems exist at the State level, too. Our State Department of
Public Instruction is working hard to implement the new law. But they
believe they will need more funding to create new data systems to meet
new data collection and reporting requirements. They will also need
more funding for technical assistance teams to help schools and
districts in need of improvement.
It is time that the Senate and the President lived up to the promises
that were made. The Murray amendment would establish a reserve fund to
add $8.6 billion to the Budget Resolution for the purpose of fully
funding No Child Left Behind. At the same time, this amendment lowers
the deficit by $8.6 billion. The amendment is fully offset. I hope my
colleagues will support this important amendment and finally provide
the funding that our students need to succeed.
(At the request of Mr. Daschle, the following statement was ordered
to be printed in the Record.)
<bullet> Mr. JOHNSON. Madam President. I want to express my strong
support for Senator Murray's amendment to the budget resolution to
fully fund the No Child Left Behind, NCLB, Act.
Adequate funding is a necessity for school districts to continue to
achieve adequate yearly progress. When Congress passed and the
President signed NCLB, we set standards of achievement to improve
education for all. However, I have been woefully disappointed with the
administration's refusal to make good on the promises it made to
provide state and local school districts with the resources they need
to implement the NCLB reforms. The administration has underfunded NCLB
by $26 billion since 2002.
In my home State of South Dakota, education officials and educators
are working very hard to meet the requirements of this law. It is
irresponsible for the Federal Government to say that States and school
districts must meet the requirements in this law, while we do not meet
the promises made in this law to provide funding to do so. Under NCLB,
South Dakota should receive $62.3 million for Title I for Fiscal Year
2005. President Bush's budget would shortchange South Dakota by $24.6
million. This would result in 8,029 South Dakota children being denied
full Title I services for which they are eligible. This is unacceptable
to me.
As I travel South Dakota and meet with superintendents, principals,
educators, school board members, and parents, I hear about how hard our
schools are working to provide the best education possible to their
students. However, this trend of continuing to underfund NCLB
commitments will only make it more and more difficult

[[Page S2486]]

for our local school districts to meet the adequate yearly progress
requirements of the law.
This Congress and the administration have an obligation to uphold our
promise that no child be left behind by the public education system. I
encourage my colleagues to support Senator Murray's amendment, which
would go a long way in helping our schools meet the challenges in
NCLB.<bullet>
Mr. DODD. Madam President, when this President came to office he
called himself the education President and called for significant
reforms. When he offered these reforms he promised to provide us with
the resources needed to implement them. Taking him at his word, this
body took up and enacted the No Child Left Behind Act two years ago.
Yet here we are, only 2 years later, and No child Left Behind is being
underfunded by $8.6 billion.
When we passed the No Child Left Behind Act we pledged to expect
more, and provide more, to our Nation's schools. And yet this pledge is
not reflected in this budget. I have to ask, how do my Republican
colleagues and the administration, expect us to raise test scores,
provide high quality teachers and prepare students for the 21st century
without the funds to do so? Furthermore, who is it that they expect to
feel the burden of these cuts? I can tell you who it will be.
First, it will be the States. States that need every dollar possible
to do more than they have ever been asked to do before. States that are
experiencing the worst fiscal crisis in decades. Second, it will be the
localities. With less funds to do more, hard decisions will have to be
made at the local level. Should local taxes be raised? Should music and
art be cut? Should after school programs be eliminated? Should physical
education classes be cut in the midst of a childhood obesity epidemic?
Ultimately, the students will suffer. They will not be given the
teachers that they need. They may not get the tutoring that they were
promised. Music, art and foreign language may no longer be a part of
the curriculum. After school programs could be cut.
When we passed No Child Left Behind, we made it clear that we were
expecting more from our schools--and rightfully so. We were expecting
more so that American children--all American children--children in the
suburbs, children in our inner cities, children in our rural areas--
would have real opportunities to reach their full potential.
This past September, some Connecticut students went back to schools
that were labeled under performing by No Child Left Behind. And yet
this budget is not committed to helping them overcome that label. This
bill will not give them the added funds they need to fully perform.
If we fail to adequately fund No Child Left Behind, our States, our
localities, our school districts, local taxpayers, and most
importantly, our children, will suffer. Budgets are about priorities.
What priority could be more important than ensuring the future of our
children by providing them with a first-class, world-class education.
Mrs. CLINTON. Madam President, I support the Murray-Kennedy amendment
to meet the funding promises in the No Child Left Behind Act.
When I voted for the No Child Left Behind Act I though we made a deal
with our local school districts--we would ask more of them and we would
provide the resources to allow them to meet those expectations. Today
it is clear that this administration has deliberately chosen not to
play by its own rules and has instead reneged on the promises it made
to teachers, parents and millions of poor school children across the
Nation.
For a third year running, this administration has shortchanged the
reforms included in No Child Left Behind. Instead of helping ensure
these children are not left behind, this administration has had a clear
record of promising false hopes and of cutting resources targeted
towards improving educational opportunities for all children.
This Democratic amendment ensures the President and the Republicans
in Congress live up to their commitments to fully fund programs like
Title I, English Language Acquisition, literacy programs, after school
and rural education and that is why I am proud to cosponsor it.
We all know that there is no greater path to opportunity than
education. Unless we fully fund No Child Left Behind, millions of needy
students will be denied the opportunity to achieve the American dream
I have visited schools across the great state of New York and I know
firsthand that our school districts are doing their part to help
students learn at higher levels. Yet they continue to struggle with
critical funding shortages to fully serve all children in need.
The Murray-Kennedy amendment would help ensure that 4.6 million
children get the quality education they need and deserve. For New York,
this funding will help close the $765.7 million gap in Title I funding
between the funding proposed in the Republican budget and the amount
that was promised to my state when we passed No Child Left Behind. With
these resources, New York schools could decrease class sizes for
834,117 students, expand preschool to 105,689 eligible children and
certify 102,740 teachers.
The more we hold off on funding these reforms, the more it will cost
school districts to meet the requirements to increase test scores and
the numbers of highly-qualified teachers. That is why we are falling
further behind every year we fail to live up to that commitment.
I strongly urge my colleagues to support the Murray-Kennedy
amendment.
Mr. LIEBERMAN. Madam President, I rise as a cosponsor to express my
support for the amendment offered by my distinguished colleague from
the State of Washington, Mrs. Murray, and my distinguished colleague
from the Commonwealth of Massachusetts, Mr. Kennedy, to fully fund the
No Child Left Behind Act and to improve overall funding for education
and training programs. I believe it is critical that my colleagues in
the Senate adopt this amendment which represents a critical investment
in America's future.
A little more than 2 years ago, in this Chamber, we made a bipartisan
commitment to leave no child behind. This landmark legislation has the
potential to strengthen our public education system. It represents an
ambitious Federal effort to dramatically revitalize public education by
closing the achievement gap, making sure every classroom has a
qualified teacher, and giving parents and students adequate choices to
ensure that their children receive a quality education. Adequate
funding, however, is essential in order to give our public schools the
support and resources they need to implement the act, and to meet the
goals embodied therein.
The amendment before us will ensure that the budget resolution fully
funds the No Child Left Behind Act at its authorized level. We have all
heard complaints with this law; the predominant one being that it is
another unfunded Federal mandate. Schools across the Nation are
struggling to meet the requirements of the law. However, they have been
shortchanged by this President, and they are being shortchanged again
by the budget resolution before us--shortchanged to the tune of $8.6
billion. How can we expect our schools to embrace the act when their
hands are tied by lack of funding? This issue has become so pronounced
that 18 States have considered a resolution that would grant them a
waiver from the law. I urge my colleagues to adopt this amendment to
assure our school systems will receive the funding levels they were
promised when the law was enacted.
This amendment will signal to our schools and school districts that
we will meet our end of the bargain, in order to make public education
in this country first class for every child in America. It will signal
to our State and local education leaders that we will stand behind our
commitment to them, and give them the support they want and need to do
their job for our children. The $8.6 billion being allocated by this
amendment can be used to ensure that we have highly qualified teachers
in our classrooms, provide additional afterschool programs, send
resources to schools identified as ``in need of improvement,'' supply
tutoring and supplemental services, and give students specialized
instruction in reading and mathematics. It can also be used to leverage
additional State and local resources for public education in this
country. Finally, I would like to point out that not only does this
amendment pay for itself, but it also dedicates an

[[Page S2487]]

additional $8.6 billion for deficit reduction.
I commend the Senators from Washington and Massachusetts for offering
this amendment as an investment in our Nation's future. I am proud to
be a cosponsor. Our schools and students need adequate resources to
meet the high expectations that have been placed upon them. I urge my
colleagues to support this amendment.
Mr. LANDRIEU. Madam President, I rise today in support of Senator
Murray's amendment that, put simply, proposes to close unfair tax
loopholes and use the funding closing them brings to fulfill the
promises we made to the parents, teachers, principals, superintendents
and, most importantly, our children. For the past hour, my colleagues
from across the aisle have tried to put a different spin on this
amendment, claiming that it raises taxes to cover increased spending.
That is what they would like the American public to believe because
then their opposition to it is easier for them to explain. But the fact
of the matter is, the underlying budget resolution now before us
already proposes that we close these very same tax loopholes, the only
difference is that under this budget the revenue generated would be
used to pay for new tax cuts for corporations and millionaires. So it
seems what we have here is a difference in priorities. Democrats are
against tax evasion and for investments in education and Republicans
are against tax evasion and for tax cuts for those who do not need
them. That is a choice I will leave to the American people come this
November.
Two years ago, we challenged our schools to reject mediocrity and
failure and to embrace excellence and high standards. We laid out
legislation that provided a blue print for reform and we promised we
would be there every step of the way, in partnership, to bring about
change in our public schools. I was one of the 13 Members of the U.S.
Senate who advocated for the kind of change embodied by the No Child
Left Behind Act long before it became a part of President Bush's
political platform. I believe in the potential of this law, its
founding principles, and the direction it leads our Nation. It is by no
means a perfect law. No law, in the history of Federal involvement in
education, has ever been perfect on the first try. But that does not
mean we must abandon it and go back to the drawing board. What we must
do is come together to both fund it and fix it.
As the old saying goes, ``talk is cheap.'' Unfortunately, this
administration does pays a great deal of lip service to principles such
as accountability, teacher quality, innovation and school choice, but
are not willing to do a whole lot to be sure that these principles are
reflected in the budget. For example, this administration says the
following when it comes to the importance of teacher quality. ``We know
that our children's future depends on their education. And the quality
of their education depends on our teachers. Strong schools and quality
teachers are the President's priorities,'' Laura Bush said on the First
Anniversary of the Passage of NCLB.
Yet, what they do to fulfill the promise of a qualified teacher in
every classroom is a different matter. In this year's budget, President
Bush proposes to cut funding for Troops to Teachers and freezes funding
for grants to States to improve teacher quality. What this means is
that States like my own, are faced with the congressionally mandated
challenge of closing the gap in the number of qualified teachers, and
have had to try and meet this challenge with approximately $100 million
less than they were promised.
The administration maintains that their goal is to improve public
schools. In fact, in January of 2001, President Bush made the following
promise: ``Once failing schools are identified, we will help them
improve. We'll help them help themselves. Our goal is to improve public
education. We want success, and when schools are willing to accept the
reality that the accountability system points out and are willing to
change, we will help them.'' If this is not a promise, I am not sure
what is. States like Louisiana believed in this promise and they
believe in accountability. For the past 4 years they have been working
hard to identify schools that were failing and turn them around. They
have done such an outstanding job that they were just recognized by
Education Week for having one of the best accountability systems in the
country.
Is President Bush fulfilling his promise to support and encourage
these efforts? No. He is pulling the plug just when they need help the
most. This year's increase in education, which has been shrinking a
little more every year since Bush took office, is the smallest increase
in education spending in 7 years. What's worse, is that according to
his budget, next year, not coincidentally a year after the election,
education funding will be cut by $1.5 billion.
Our schools need more than lip service and empty promises, they need
help. Now, I have asked the President and my Republican colleagues, why
the President would not provide States with the resources he promised
would be available to support their efforts. Here is what they tell me.
They say, ``Senator Landrieu, the President did not make any promises
when it comes to funding, the funding levels listed in the law are just
goals. Congress never appropriates as much as they authorize.''
I think it is important for the American people to be able to
separate fact from fiction. Let me tell you what the facts are on this
point. When a program is a high enough priority for the President, you
can bet it will be funded. Let me give you some examples. Last year,
Congress appropriated $1 billion for a program called the Millennium
Challenge Account, a brand new foreign policy program proposed by the
administration. The President demanded $1 billion and he got a full
billion. Same was true for the tax package in 2003. Congress authorized
the passage of a $350 billion tax cut and we spent all $350 billion.
Medicare, the Iraq Supplemental, the Compassion Capital Fund, the list
goes on and on.
The Secretary of Education claims that the reason for the decreased
financial support from the administration is because States have too
much money and are not even spending what they already have. In the
words of Ted Stilwill, the school chief from Iowa, ``The implication
that [States] have let huge sums of federal money languish that the
funds are at our disposal to use at our discretion, or that we have not
been good stewards of the public's money is not only unfair, but
patently insulting.'' Here are the facts: According to data from the
U.S. Department of Education, States are actually spending their
federal money faster than expected. As of February 20, using normal
spending rates, States should still be waiting to spend about 7 percent
of their Federal education money from fiscal years 2000 to 2002. As a
matter of fact, States have spent all but 6 percent.
What our kids need is less excuse making, fewer empty promises, and
more leadership. In the words of President Bush himself, ``The time for
excuse making has come to an end Accountability for results is the law
of the land.''
I would like to close my remarks this morning with one final
Presidential quote. ``We possess all the resources and all the talents
necessary. But the facts of the matter are that we have never made the
national decisions or marshaled the national resources for such
leadership. We have never specified long-range goals on an urgent time
schedule, or managed our resources and our time so as to insure their
fulfillment . . . Let it be clear that I am asking the Congress and the
country to accept a firm commitment to a new course of action--a course
which will last for many years and carry very heavy costs . . . [but]
if we were to go only halfway, or reduce our sights in the face of
difficulty, it would be better not to go at all.''
Many of you may be saying to yourselves sounds like something
President George Bush said when he urged Congress to pass the No Child
Left Behind Act, perhaps the most sweeping reform of Federal education
policy since 1965. But you would be wrong. This was from a speech given
by another President making a historic challenge to the Nation. This is
an excerpt from the famous ``Man on the Moon Speech'' delivered by
President John F. Kennedy.
In 1961, President Kennedy presented a bold challenge to Congress and
the Nation: to reach for the stars, to put a

[[Page S2488]]

man on the moon within the next decade. Most thought he was over
ambitious, perhaps even crazy. It was such a large task, it could never
be done. Put a man on the moon in less than 10 years? In June on 1969,
8 years and 1 month after this speech, Neil Armstrong and Buzz Aldren
landed on the moon and Neil Armstrong uttered the immortal phrase,
``one small step for man, one giant leap for mankind.''
The difference is that President Kennedy was not only willing to make
the challenge. He was willing to stand strong and provide the
leadership and the resources necessary to meet it. In 1961, all tolled,
the United States was spending $1.6 billion, the equivalent of $8.7
billion today on space programs. By 1966, just 5 years later, we were
spending $7 billion, which is close to $30 billion in today's dollars.
But it was more than just money, he provided the leadership and the
support. He made commitments and he stood by them. This program was
more than his speech for the day, it was a top priority. And it worked.
History may have been very different if it hadn't.
In the words of the late President Kennedy, ``if we were to go only
halfway, or reduce our sights in the face of difficulty, it would be
better not to go at all.'' We made a promise to our States, more
importantly, to our children. The Murray amendment fulfills that
promise, it stays the course and that is why I am proud to support it.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. I yield myself such time as I might consume off the 18
minutes remaining on this side.
Madam President, once again I remind the Senate about some of the
issues that face the Senate Committee on Finance which I chair and how
certain assumptions being made by some of the amenders of the budget
resolution might be affected by that or how their decisions might
affect decisions we have to make.
First of all, there is the general proposition with all budgets and
all amendments that pretend to dictate to committees where they ought
to get the money or what legislation they ought to pass. This is just a
recommendation that has no force of law. It can be entirely ignored by
any of the committees, including the Committee on Finance. So when
there is a premise certain loopholes ought to be closed, certain tax
rate changes ought to be made to affect upper income limit people, the
people voting on this amendment and similar amendments ought to
understand they are voting on numbers they are giving us, nothing else,
because we will have to make those decisions not just on the substance
of the dictates of the budget resolution but also on the responsibility
to report a bipartisan bill.
We will have yesterday, today, and much more tomorrow, a whole series
of amendments coming from the Democrat side of the aisle, trying to
dictate something Democrats want Congress to accomplish, but with
almost no Republican support. The Senate Finance Committee cannot
function under that sort of partisanship. We have to get things done in
a bipartisan way. If people who offer amendments to the budget expect
their amendments to be adopted, it starts with bipartisanship. I have
not seen that in very many of the amendments we have had thus far. I
guarantee, nothing will be done by the Senate Finance Committee in a
strictly partisan way. That is a dead end. That is an alley with no
opening. We have to report a bipartisan bill if we expect to get it
through the Senate.
The other thing I want my colleagues to understand, and why they
should vote against this amendment, is it assumes gaining certain
revenue from loophole closings. I can tell you of tens of billions of
dollars we are going to get from closing loopholes, but we are doing
that because of the responsibility of the Senate Finance Committee,
first of all, has to have a fair Tax Code, and secondly because we have
the obligation, if we are going to make tax changes, to have those
offset. Without revenue neutrality we do not have bipartisanship, and
without bipartisanship nothing is going to get through the Senate.
A lot of very popular tax provisions Democrats or Republicans expect
me to get passed before this year is out, like the marriage penalty,
like the $1,000 tax credit for children, and the 10-percent bracket so
we can help low-income people pay less tax because they need that money
themselves to live rather than sending it to us to spend--both
Democrats and Republicans expect me to get that passed. We are going to
use the revenue from the loophole closings to fund those provisions. We
cannot have that money spent on appropriated accounts. It has to be
used to offset this social and economic policy that is involved in
doing away with the marriage penalty--the $1,000 child credit and the
10-percent bracket, and even in addition to that, maybe, finding some
bipartisan solution to bringing finality to what the estate tax ought
to be in America as opposed to what it is now or what it will be in
2011 when we go back to just the $1 million exemption.
Those are things we are going to do. Obviously, we ought to close
these tax loopholes and shelters because they are unfair. Some of them
are outright schemes for corporations to avoid taxation. However, we
cannot use that money twice. It will be used once. It will be used by
our economy to establish a fair tax policy.
In addition to that, and unrelated to my position on the Senate
Finance Committee, how I react to the debate we have had thus far on
this amendment--particularly when I hear some Senators on the other
side say something like this: Don't tell me we have increased education
spending by 60 percent, because I know that.
What that Senator wants us to hear is we have not appropriated what
somebody thought we ought to appropriate, which we seldom do anyway. I
am well aware of that. I am well aware of promises that were made by an
administration on education expenditures, maybe in the first year of
this administration, but what I have not heard from the other side of
the aisle is, they decide how money ought to be divided, is what
happened on September 11 and the war on terror and how that changes
everything. How has that changed everything?
You put your resources behind the men and women in battle. You put
your resources behind winning a war. That has caused the President of
the United States and the Congress, in turn, to divert some money from
domestic expenditures to the war on terror, to the Defense Department,
and to homeland security. That is what is different now from the time
when people thought this administration made certain promises on a lot
of Federal programs, not just education.
It seems to me a responsibility we have when we overwhelmingly pass a
resolution for war that, if we are going to put our men and women on
the battlefield, you have to give them all the resources it takes to
win that effort. If you do not, you should not be going to war.
Now, those who voted against that resolution may have the privilege
of voting against funding our men and women in the battlefield, but it
seems to me, regardless of whether you voted for the war resolution or
not, you have a responsibility to stand behind our men and women.
That is what has changed between promises being made on education and
today. There has been a diversion of money. But even considering all
that, this administration, on the present budget and on previous
budgets, has put education No. 1, after the war on terror--including
Afghanistan and Iraq--and after homeland security, because education is
the domestic program that gets the biggest increase in expenditures
over anything else.
With that in mind, I ask that we defeat this amendment. I ask that it
be defeated because the revenue supposedly being used is the revenue we
are going to use to make the Tax Code more fair to implement the social
and economic policy we have that we call doing away with the marriage
penalty, helping families, by keeping the $1,000 child credit, and
helping low-income people to pay less tax and to have more money in
their pockets so they can support their families to a greater extent.
I yield the floor.
The PRESIDING OFFICER (Mr. Chambliss). Who yields time?
The Senator from North Dakota.
Mr. CONRAD. Mr. President, I ask the Senator, could I have 2 minutes
off the amendment?

[[Page S2489]]

Mrs. MURRAY. Mr. President, I would be delighted to give the Senator
from North Dakota 2 minutes.
The PRESIDING OFFICER. The Senator from North Dakota is recognized
for 2 minutes.
Mr. CONRAD. Mr. President, we have heard a lot of talk that the
amendment of the Senator from Washington raises taxes. Well, it does
not raise taxes on anybody except those who are engaged in the abuse of
tax loopholes. Because that is what the amendment of the Senator from
Washington provides: that tax loopholes are closed in the amount of
$8.6 billion.
All this talk about middle-class tax relief has nothing to do with
this amendment--nothing. She is not talking about, in any way,
affecting the 10-percent bracket or the childcare credit, or any of the
other middle-class provisions--not at all.
The Senator from Wyoming indicated this is going to increase taxes on
people, on small businesspeople, on middle-class taxpayers. It is not.
It is aimed at tax loopholes.
Let's talk about the type of tax loopholes that one might consider.
There is now, across the land, a scam going on of enormous proportion.
New York has sold their subway system to a group of private investors,
and then they turn around to lease it back, and the private investors
get to depreciate the New York City subway system. New Jersey sold off
their sewer system to private investors, which then depreciate the
sewer system and then get away with a dramatic reduction in their
taxes. These are scams.
The administration, to its credit, has said we ought to close these
loopholes. They think it will raise $33 billion. The amendment of the
Senator from Washington is $8.6 billion to keep the promise of No Child
Left Behind--no tax increase, an end to scams.
It does not end there. The Joint Tax Committee did a thorough
analysis of the Enron scandal and found a series of abuses that could
be closed which would save billions of dollars in closing tax
loopholes--no tax increase but stopping the scams.
And it does not end there. We have the spectacle of certain companies
and certain wealthy Americans renouncing their U.S. citizenship--Mr.
President, I ask for 30 seconds more, if I could.
Mrs. MURRAY. Mr. President, I yield 30 seconds to the Senator.
The PRESIDING OFFICER. The Senator is recognized for an additional 30
seconds.
Mr. CONRAD. We have the spectacle of certain wealthy individuals and
major corporations renouncing their U.S. citizenship to avoid U.S.
taxes. Closing down that loophole saves $3 billion.
Now, if anybody wants to vote against closing loopholes, let them
vote against the amendment of the Senator from Washington. She is
closing those loopholes in order to fund our kids' education. That is
exactly what we ought to do.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. The Senator's time has expired.
Who yields time?
Mrs. MURRAY. I thank the Senator from North Dakota for that
clarification.
Mr. President, I yield 10 minutes to the Senator from Minnesota.
The PRESIDING OFFICER. The Senator from Minnesota is recognized for
10 minutes.
Mr. DAYTON. Mr. President, I commend my colleague, the Senator from
Washington, for her amendment, along with Senator Kennedy, and for her
dedicated and lifelong efforts to improve the quality of education for
all of our Nation's children. She has been a pioneer and a champion in
the Senate, as she has been in her career as an educator. She knows
whereof she speaks.
Once again, we are encountering the same old arguments from the other
side of the aisle. Personally, I am tired of going back to 1993 or 1994
to try to explain or excuse what it is we are doing or not doing right
now for education in this country. I want us to do what is right for
now, to respond to the needs that exist now. I have said it in other
debates on education funding, and I will say it again: If President
Bush proposed more money than President Clinton, then President Bush
deserves that credit, in my eyes. If the 108th and the 107th Congresses
provided more money for education than previous Congresses, and more
than President Bush has proposed at times, then this Congress deserves
that credit, in my eyes.
But we are not doing this for ourselves. We are not trying to keep
some scorecard. We are not trying to fiddle around with percentages or
other things. We are doing this for America's children.
The important question we ought to all be asking ourselves is, Are we
doing enough? Are we providing the money needed to do what we all said
should be done to leave no child behind?
That is this President's proclamation. He set that standard for us
and for the country. That is the law we passed. It is a great standard.
It is an important standard, and we all seem to agree that should be
the standard. So the question we need to ask ourselves is, Are we
budgeting the money necessary to achieve that result?
When the Pentagon and Joint Chiefs of Staff have said they needed
more money to win the wars in Afghanistan and Iraq, we have provided
that money, with bipartisan support, overwhelmingly.
When the President and Secretary Ridge have said they needed more
money to protect our homeland, to provide protection and safety for all
our citizens, we have done so on a bipartisan basis. Some of us,
including Senator Murray, has urged we do more.
We have set the objectives in the Congress along with the
administration. We defined the standards of military victory and
national security, and we have provided the money necessary to succeed,
because that is what is important, that we succeed at these most
important goals we set for our Nation.
Now, we have also increased the Federal deficit enormously to do so.
We cut taxes very significantly, especially for the wealthiest people
in this country. People whose annual income is greater than $1 million
are receiving, this year, on average, a tax reduction of $113,000. It
has not bothered the majority enough to make any of those adjustments.
When I hear these concerns expressed about these onerous tax burdens
that are imposed on the superrich, the multimillionaires and
billionaires of America, or the large corporations that Senator Conrad
pointed out are not paying their fair share of taxes, not paying the
percentage of their taxes owed as our small business owners pay, then I
must say, I think some of that is crocodile tears.
With all deference to the chairman of the Senate Finance Committee,
whom I admire enormously and who has dealt with these matters, as
somebody who comes from--or at least before I got mixed up in
politics--the category of the wealthy, I would be glad to sit down with
him and go through it to discover how easily we can find the money to
pay for what he said he wants to do on taxes and what Senator Murray is
proposing to do on education. It is not an either/or.
Nobody on this side wants to jeopardize the increase in the child tax
credit which was passed with overwhelming bipartisan support. In fact,
it was originally a recommendation from this side of the aisle, but it
has bipartisan support. The same with eliminating the marriage penalty
and expanding the 10-percent bracket. We are not going to do one thing
to affect those extensions.
This is about education. Somehow that is treated differently by the
other side. We can't close any of the tax loopholes. We can't allow the
millionaires or billionaires to escape one penny of taxes they owe. We
can't increase the deficit. Once again: Gee, we can't find the money we
need for education.
We are also told there is extra, unused money in the Federal pipeline
going to State and local governments for public schools. I have heard
that in the years I have been here: Head Start has positions for kids
that are unfilled because there isn't a need or demand. Special
education has more money than they know what to do with. For No Child
Left Behind, there is more than enough money being provided.
When I tell this to educators and school board members and others in
Minnesota who are involved with education, they think I am joking. They
think Congress must be seriously out of touch with reality. Where is
this pipeline, they ask, and if some States have more money than they
need or know what to do with, would they

[[Page S2490]]

please send it on to Minnesota. I doubt my State is alone because all
the national organizations involved in these matters have said for
years, Head Start is being funded about half for the kids who are
eligible.
Again, Congress set these standards years ago. Congress defined what
the eligibility was for these programs. We are not making these numbers
up out of whole cloth. We are supposed to be setting the measure of
what qualifies a child for Head Start, the kids who need it.
Almost 30 years ago the Federal Government promised to pay for 40
percent of the cost of special education. It is less than half of that
today. President Bush has increased it. This Congress has increased it
every year. Still it is less than half. So the question is not what is
the percentage; the question is, are we keeping a promise we made
almost 30 years ago. At least in Minnesota, when it is not being met,
it has to be met, in most cases, with higher property taxes or cutbacks
in the quality of education for all students.
Title I, again, is seriously underfunded and has been for years. In
Minnesota's case, less than half the students are eligible by the
Federal definition of what qualifies the child in poverty, with all
those disadvantages, for title I funding, the additional funding that
is supposed to give that child the chance he or she deserves and
certainly is now entitled to by law under the President's initiative--
less than half of those students in Minnesota, and we are going to lose
money under the new formula.
In all these major areas of Federal Government responsibility for the
education of our children, we have been providing far less than enough,
far less than our own laws and our own statements of intent have called
for. I don't know whose fault it is. I don't think that is relevant. I
know whose responsibility it is today. That is what matters. It is our
responsibility. It is our responsibility to provide the funds necessary
to fulfill our part of the bargain with States and local governments
and school boards and the schools and, most importantly, with the
children of America. If we are not willing to do that, then let's
change the law.

In Minnesota we have laws against consumer fraud. I would say if we
don't address these funding shortfalls, to call this No Child Left
Behind violates the spirit at least of that law. If we are not going to
do more than we are doing now, let's at least have the honesty to tell
the truth to the American people. We didn't mean it. It sounds good;
great slogan, but, sorry, it is not enough of a priority for us.
Tell the States: You come up with the money for these unfunded
mandates, for the additional part of special education, which in
Minnesota costs our schools about $250 million a year, real money. No
pipeline I am aware of can come up with that kind of money the schools
in Minnesota need.
Let's tell school boards: Yes, you keep on raising local property
taxes in order to make up for what the Federal Government has promised
but isn't providing. Then let's have the honesty to tell the children,
the future of America: Sorry, you are not important enough.
I can only speak for Minnesota, but in my State schools are cutting
classes, opportunities. They are laying off teachers. Class sizes are
increasing; sports and extra curricular activities are being cut back.
You have to pay a special fee just to be a student. We know here in
Washington that money is needed and should be spent and would be spent,
but, sorry, we are not going to provide it. We have other, more
important priorities.
That is what the Murray amendment is about. It is a moment of truth
for this body, the Senate. Do we mean what we say, no child should be
left behind? Do we mean it? Are we willing to fund that as we funded
other important national priorities, or is it not important enough in
the scheme of things to do what we promised to do?
Senator Murray has given this Senate, before the eyes of the Nation,
this moment of truth. What are our priorities? Do we keep our promises?
Do we do what we know should be done and say must be done, and what
every child in America deserves to have done, which is provide the
funding necessary for quality education to leave no child behind?
I thank the Senator from Washington.
The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Mr. President, I thank the Senator from Minnesota and
all of our Democratic colleagues who have spoken. When the Senator from
Minnesota was speaking, I couldn't help but think of someone he
remembers well. During the whole debate of No Child Left Behind,
Senator Paul Wellstone, who was on the floor during that debate saying:
We are giving a promise I don't believe we are going to keep. Everyone
assured him: No, no, we will put this accountability in place. We will
fund this.
The Senator from Minnesota speaks from his heart, as I know Senator
Wellstone would have admired him for, in reminding all of us what is
happening to our children and to our schools because we haven't kept
the promise all of us said we would keep when the debate took place
several years ago.
How much time remains on both sides?
The PRESIDING OFFICER. The Senator from Washington has 8 minutes, and
the Senator from New Hampshire has 8 minutes 33 seconds.
Mrs. MURRAY. Mr. President, let me ask my colleague from New
Hampshire if he intends to use any more time on their side. I have a
few more minutes I would like to speak.
The PRESIDING OFFICER. The Senator from New Hampshire has 8 minutes
33 seconds remaining.
Mrs. MURRAY. And our side has 8 minutes.
The PRESIDING OFFICER. Seven and a half minutes now.
Mrs. MURRAY. I was inquiring how much time the Senator from New
Hampshire intended to use, or if he wanted to go now.
Mr. GREGG. How much time does the Senator need to close?
Mrs. MURRAY. I would like 5 minutes.
Mr. GREGG. I have no problem having the Senator close now and we can
go to a vote.
I am sorry. I can't do that. I guess I will speak for about 8 minutes
and then yield to the Senator.
The PRESIDING OFFICER. The Senator from New Hampshire is recognized.
Mr. GREGG. Mr. President, it has been a good debate. It certainly has
outlined the issues involved. I want to reemphasize some points made by
the chairman of the Finance Committee who spoke about how the $17.2
billion of tax increases in this amendment work. It is the only real
part of this amendment.
The amendment represents it is going to take this tax increase and
use it to fund No Child Left Behind at the fully authorized level. It
can't do that for parliamentary reasons. It is unable to make that
clear event within the amendment.
The only clear event within the amendment that does actually occur is
there is a $17.2 billion increase in taxes. The point which the
chairman of the Finance Committee made, and which I think needs to be
reemphasized, is those dollars could easily, if they are raised in this
manner, end up significantly impacting our ability to allow people who
are now benefiting from no longer having to pay the marriage penalty;
those folks could end up paying the marriage penalty because we won't
be able to extend the relief from the marriage penalty tax.
If taxes are raised under this bill, those dollars could easily
absorb the money intended to be used for the purpose of addressing the
issue of the child tax credit, which is a $1,000 tax credit. The
extension of that might well be impacted. Those dollars, if this tax is
put in place, could potentially impact the ability of this committee to
finance the continuation of the expansion of the 10-percent bracket for
low-income Americans so they have to pay less burden. Why is that? He
made the point, and I thought rather well, that that is because he
intends to use the alleged loopholes recited here by my colleagues,
which loopholes should legitimately be closed.
There is no reason people should be selling and leasing back the
subway system of New York, and the President supports making sure that
loophole is closed. He intends to use that revenue in order to fund the
ability of people to get a child tax credit of $1,000, to avoid having
to pay a penalty because they

[[Page S2491]]

get married, and to assist in expanding the 10-percent bracket.
As he makes the point, rather legitimately, if the dollars are
siphoned off from those loophole closures that are planned under the
budget, put in place, and are already in place and accepted as part of
this budget, if those dollars are siphoned off and end up flowing
pursuant to this amendment into a reserve account, he won't have the
dollars available to him as chairman of the committee to accomplish
those tax relief efforts.
We are playing with some serious fire here. Basically, the risk of
this amendment is, No. 1, raising taxes $17.2 billion over what we need
to do; but No. 2, it puts at risk the ability of the chairman to
address the use of the taxes that have been put in place in this budget
through loophole closings to jeopardize the use of those taxes for the
purpose of addressing the marriage tax penalty, the child tax credit,
and the 10-percent bracket. A very important point.
Secondly, this amendment represents the goal is to fully fund No
Child Left Behind at the authorized level. I believe we have discussed
this at some length, but I think it is worth emphasizing again.
Authorization numbers are guideposts. Rarely, as a Congress, have we
met authorization numbers. The proof is in the pudding.
The last time the Congress was controlled by the Democratic Party and
there was a Democratic President, title I was not funded to the full
authorization level. It was funded significantly below the authorized
level. In fact, this President's commitment to funding education has
dramatically outstripped the prior President's commitment or actions in
this area. I am sure he had a commitment, but he wasn't able to find
the dollars.
This President has made a huge commitment in the area of funding
education, and the dollar increase has been a billion dollars a year
every year--a billion, billion, billion, billion--cumulative billions
for the special education accounts, and a billion and a half to a
billion cumulatively for title I and for No Child Left Behind.

I see the chairman of the Finance Committee. I was trying to restate,
probably nowhere near as well as the chairman can, the effect of this
$17.2 billion credit on his ability to do the extenders, which are so
important to low-income families and married people and people with
children.
I yield the remainder of our time to the chairman.
The PRESIDING OFFICER. The Senator from Iowa is recognized for 3
minutes.
Mr. GRASSLEY. I thank the Chair and I thank the Senator from New
Hampshire for his great leadership in dealing with education.
I spoke about the necessity of the Finance Committee having the
freedom to use revenue we can raise by closing these tax loopholes, and
the necessity of getting a bipartisan bill out of committee to do it. I
think the Senator from North Dakota spoke very well about some of the
problems we have with corporations and schemers and scammers using the
Tax Code to avoid taxation, by ridiculous things like leasing a subway
for a city in the United States, where there is no risk or economic
substance to the process. We want to close those loopholes.
I thought I ought to bring to the attention of the Senate one of the
bipartisan bills out of committee that was using some of those loophole
closings. They definitely have an impact upon some major industries and
jobs in this country where they are going to be hurt, because the World
Trade Organization has ruled contrary to our trade agreements, the
foreign sales corporation, and the extraterritorial income provisions
we have had to make to make our business competitive with European
business. Since that is ruled out, a lot of jobs in major
corporations--Microsoft and Boeing, to name a couple--are going to be
hurt and be uncompetitive because of that.
We are taking some of the loophole closing money that is available to
offset the revenue, to reduce corporate tax from 35 down to 32, so our
businesses can be competitive. We can save jobs at Microsoft and Boeing
which would otherwise be uncompetitive as a result of the foreign World
Trade Organization ruling.
I don't want the Senate Finance Committee's hands to be tied by a
scheme that thinks this money can be used four or five times and can be
spent on domestic programs, when we have to have this money to offset
very important tax provisions we want to get passed. Saving jobs
through this JOBS bill that was before the Senate last week, and will
be up again in 2 weeks, is an ideal place to use that revenue.
I yield the floor.
The PRESIDING OFFICER. The Senator from Washington is recognized.
Mrs. MURRAY. Mr. President, I yield a minute to the Senator from
North Dakota.
The PRESIDING OFFICER. The Senator from North Dakota is recognized
for 1 minute.
Mr. CONRAD. Mr. President, let me just say the amendment of the
Senator from Washington does nothing to raise taxes on middle-class
taxpayers, on wealthy taxpayers, on anybody but people who are engaged
in tax scams and tax dodges, because her proposal is to close tax
loopholes to the tune of $17 billion.
As we look in the budget, there is a relatively modest amount of
money being raised to close tax loopholes. We know there are tens of
billions of dollars, according to the administration, in potential tax
loopholes that could be closed.
In addition, let me say to my colleagues I met with the revenue
commissioner 2 weeks ago, who tells me the tax gap--the difference
between what is owed and what is being paid--was $255 billion for 2001
alone. Let me repeat that. The tax gap--the difference between what is
owed and what is being paid--is $255 billion for 2001 alone. There is
plenty of money to be raised in tax loophole closings and the end of
tax scams and the end of the tax gap to fully fund the amendment of the
Senator from Washington and the middle-class tax relief all of us want
to see continue.
The PRESIDING OFFICER. The Senator from Washington is recognized.
Mrs. MURRAY. Mr. President, I know we are going to have a vote in a
few minutes. I will wrap up a few things. There has been a lot of stuff
strewn across the floor about this. We need to remember what this
amendment is all about. It is about keeping a commitment all of us made
when we voted to pass No Child Left Behind.
We told our schools, essentially our children, our communities, our
families across this Nation that we were going to put in place
accountability; that we wanted our students to learn, we wanted them to
achieve, and we wanted them to be able to go on and get the skills they
needed to be out in the job market.
The Senator from Iowa talked about Microsoft and Boeing and making
sure we can be competitive. The best thing for Microsoft and Boeing to
be competitive is to have an educated workforce of young people who
have the skills they need to come in and do the kinds of jobs to be
competitive in an international marketplace.
When we passed the No Child Left Behind Act, we said we were going to
put those standards out there, but that was a two-pronged promise, and
the other promise was to fully fund No Child Left Behind.
I have been amazed, sitting on the floor all morning listening to the
other side say: We never intended to fully fund No Child Left Behind. I
am shocked. I thought during the debate we had an agreement that we
would have accountability and that we would have funding. Now to come
back 2 years later and say, We never intended to fully fund this act,
what kind of promise is that to our children? We are going to make you
take tests and meet standards, and every year we are going to increase
those standards and we expect you to live up to it. But here in
Congress we can get behind some kind of statement that we never
intended to fully fund it? That doesn't fly in my home.
I think it is imperative that we face the American people and tell
them that when we in the Senate make commitments, we mean it. When we
make a promise to fund education, to make sure our students have the
skills they need, and they can meet those accountability requirements,
we keep it. That is what this amendment is about. It is as simple and
as clear as that.
I heard those on the other side argue that this is not a real
amendment. I

[[Page S2492]]

heard them say that it just sets up language. The language that I use
in this amendment is the exact language that the other side has in the
budget to set up a reserve fund for transportation, to set up a reserve
fund for Iraq and Afghanistan funding, to set up a reserve fund for
fire suppression. Are those not real, either? If those are not real,
then I accept the argument that mine is not real. But if they want to
stand out here and say we are fighting for fire suppression, that their
budget covers Iraq and Afghanistan, that their budget covers
transportation, then this amendment covers the No Child Left Behind
funding.
This amendment is real. It is exactly real. No one can hide behind
the fact it is not real. It is real to every child in every classroom
across this country.
There is a revolt going on in this country. Any Senator who has been
home and been in a school knows it. Any Senator who has talked with
legislators at their homes--and I know there have been discussions in
Virginia, Utah, and many other States across the country--knows they do
not want this mandate anymore and to take off the handcuffs because we
have not funded it.
We have not lived up to our obligation to our children, to our
communities, to our families, to our States, and to everyone else in
this world who cares about education because we have not funded this
bill.
My amendment is basic and simple. It says we will follow up on a
promise we made 2 years ago to fully fund No Child Left Behind. I am
more than at ease to go home and tell my constituents that I am
fighting to make sure their children get a good education and we follow
up on a promise. That is the decision every Senator is going to have to
make when they vote on this amendment. Whose side are you on, on the
side of making sure we keep our promises, making sure our children have
the ability to learn and we do not just tell them they have to live up
to standards, or on the side of hiding behind smoke and mirrors?

I intend to go home and tell my families in every community across
the State that I am going to fight every single day I am here to make
sure their children have quality teachers, their children have quality
classrooms, their children have the ability to have good curriculum,
their children are able to learn the skills they need from highly
qualified teachers because that is what we promised them in this bill.
This amendment is about keeping promises. I urge my colleagues to
vote for the Murray-Kennedy amendment. I ask for the yeas and nays.
The PRESIDING OFFICER. The time of the Senator has expired.
Is there a sufficient second?
There appears to be a sufficient second.
The question is on agreeing to amendment No. 2719. The clerk will
call the roll.
The bill clerk called the roll.
Mr. REID. I announce that the Senator from South Dakota (Mr. Johnson)
and the Senator from Massachusetts (Mr. Kerry) are necessarily absent.
I further announce that, if present and voting, the Senator from
Massachusetts (Mr. Kerry) would vote ``yea.''
The PRESIDING OFFICER (Mr. Sununu). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 46, nays 52, as follows:

[Rollcall Vote No. 35 Leg.]

YEAS--46

Akaka
Baucus
Bayh
Biden
Bingaman
Boxer
Breaux
Byrd
Cantwell
Carper
Clinton
Conrad
Corzine
Daschle
Dayton
Dodd
Dorgan
Durbin
Edwards
Feingold
Feinstein
Graham (FL)
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Mikulski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Reed
Reid
Rockefeller
Sarbanes
Schumer
Stabenow
Wyden

NAYS--52

Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Campbell
Chafee
Chambliss
Cochran
Coleman
Collins
Cornyn
Craig
Crapo
DeWine
Dole
Domenici
Ensign
Enzi
Fitzgerald
Frist
Graham (SC)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Kyl
Lott
Lugar
McCain
McConnell
Miller
Murkowski
Nickles
Roberts
Santorum
Sessions
Shelby
Smith
Snowe
Specter
Stevens
Sununu
Talent
Thomas
Voinovich
Warner

NOT VOTING--2

Johnson
Kerry

The amendment (No. 2719) was rejected.
Mr. NICKLES. Mr. President, I move to reconsider the vote.
Mr. CONRAD. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. NICKLES. Mr. President, I thank our colleagues. We spent most of
the morning on one amendment. I discussed this with my friend and
colleague from North Dakota and said I know a lot of Members have
education speeches they want to make. We were pretty generous with time
allotments for those amendments. But I really want to tell our
colleagues that generosity with time is coming to a close. We are going
to start picking up the pace rather substantially. That means we are
going to have a lot more votes. It means I am doing everything I can to
avoid a vote-arama which Senator Byrd and I have discussed many times.
We think it is demeaning to the Senate to have a large number of votes
where Members are voting with almost no debate. We are making a great
concession on our side. It is easy to debate and say now the time is up
and have a vote-arama. I think that is demeaning to the Senate.
I have discussed this with my colleague, Senator Conrad. We are
willing to consider more amendments with time agreements, have a
shorter debate time, and try to dispose of amendments so we can avoid
the necessity of being here very late Wednesday, Thursday, Friday, and/
or Saturday. We are going to complete the bill. But let us try to
cooperate, Democrats and Republicans, proponents and opponents. We all
have various issues on these amendments, but we are going to have to
move quickly. That last rollcall vote was 25 or 26 minutes. The time
limit is 15. I expect to be calling for regular order shortly after 15
minutes. We have three or four very significant amendments that will be
coming up. Senator Byrd, I believe, is going to offer an amendment
dealing with striking reconciliation. I believe Senator Stevens and
Senator Warner may be offering an amendment on defense. Excuse me.
Senator Lindsey Graham and Senator Bunning have an amendment we hope to
be able to accept. That shouldn't take too long. Senator Byrd has an
amendment on reconciliation. We expect an amendment dealing with
defense. We expect an amendment dealing with pay-go. Those are three or
four major issues. We might stack the votes. I will consult with my
colleague from North Dakota as far as the timing of the votes.
We have had a significant debate. It is time for us to dispose of
these amendments so we can avoid the so-called vote-arama.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, might I add my voice to the voice of the
chairman. We are rushing toward another vote-arama. We have 58
amendments noticed on this side already. Some of them are duplicative.
On some of them, one Senator is offering many more than one amendment.
I am asking our colleagues to please let us exercise discipline. Let us
reduce the number of amendments. I propose to my colleague that we
consider entering into a time agreement at least on these next few
amendments. If we could agree, for example, on 30 minutes or 40 minutes
equally divided on the next amendment, and then an hour equally divided
on an amendment on reconciliation, then an hour on an amendment at the
designation of the chairman, and then an hour equally divided on pay-
go, and stack the votes, we could then have a series of three votes at
about 5:45 which might accommodate some. I know there are plans for
this evening by some. At least we could get a series of important votes
concluded.
Mr. NICKLES. Mr. President, I appreciate my colleague's excellent
suggestion. I am not ready to enter into a consent on all of those
amendments. I think the Senator from South Carolina has indicated he
wants 45 minutes on his amendment. I am willing to enter

[[Page S2493]]

into an agreement on Senator Byrd's amendment. I don't think I am ready
to go yet on the Stevens-Warner amendment. I need to consult with them
first. If we can enter into an agreement on those two amendments, I am
happy to do that.
Mr. CONRAD. I am happy to enter into an agreement of 45 minutes
equally divided on the Graham amendment and an hour equally divided on
the Byrd amendment.
Mr. NICKLES. I have no objection.
Mr. BYRD. Mr. President, reserving the right to object, I am not yet
ready to enter into an agreement on my amendment.
The PRESIDING OFFICER. Objection is heard.
Mr. NICKLES. Mr. President, our order would be then to consider the
amendment offered by Senator Graham and Senator Bunning.
The PRESIDING OFFICER. Under the previous order, the next order of
business is the amendment of the Senator from South Carolina, Senator
Graham.
The Senator is recognized.

Amendment No. 2731

Mr. GRAHAM of South Carolina. Mr. President, I send an amendment to
the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from South Carolina [Mr. Graham], for himself,
Mr. Daschle, Mr. Bunning, Mr. Leahy, Mrs. Clinton, and Mr.
DeWine proposes an amendment numbered 2731.

Mr. GRAHAM of South Carolina. Mr. President, I ask unanimous consent
that reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To enhance military readiness by creating a reserve fund to
provide TRICARE benefits for members of the Selected Reserve of the
Ready Reserve, fully offset through reductions including unobligated
balances from Iraqi reconstruction, and a reserve fund to provide
Montgomery GI Bill benefits to members of the Selected Reserves)

On page 28, after line 7, insert the following:

SEC. 304. RESERVE FUND FOR GUARD AND RESERVE HEALTH CARE.

If the Committee on Armed Services or the Committee on
Appropriations reports a bill or joint resolution, or an
amendment thereto is offered or a conference report thereon
is submitted that expands access to health care for members
of the reserve component, the Chairman of the Committee on
the Budget may revise allocations of new budget authority and
outlays, the revenue aggregates, other appropriate
aggregates, and the discretionary spending limits to reflect
such legislation, providing that such legislation--
(1) would not increase the deficit for fiscal year 2005 and
for the period of fiscal years 2005 through 2009, or would
offset such deficit increases through reduction of
unobligated balances from Iraqi reconstruction; and
(2) does not exceed $5,600,000,000 for the period of fiscal
years 2005 through 2009.

SEC. 305. RESERVE FUND FOR MONTGOMERY GI BILL BENEFITS.

If the Committee on Armed Services or the Committee on
Appropriations reports a bill or joint resolution, or an
amendment thereto is offered or a conference report thereon
is submitted, that increases benefit levels under the
Montgomery GI Bill for members of the Selected Reserves, the
Chairman of the Committee on the Budget may revise
allocations of new budget authority and outlays, the revenue
aggregates, other appropriate aggregates, and the
discretionary spending limits to reflect such legislation,
providing that such legislation--
(1) would not increase the deficit for fiscal year 2005 and
for the period of fiscal years 2005 through 2009; and
(2) does not exceed $1,200,000,000 for the period of fiscal
years 2005 through 2009.

Mr. CONRAD. Mr. President, with the indulgence of the Senator, might
I repeat the request. I think we might have it worked out so we can
enter into a time agreement on the next two amendments, if the chairman
would be willing to repeat the request.
Mr. NICKLES. Mr. President, I ask unanimous consent that the
amendment by Senator Lindsey Graham and Senator Bunning be limited to
45 minutes without second-degree amendments, and I ask unanimous
consent that the amendment to be offered by Senator Byrd be limited to
1 hour equally divided without second-degree amendments.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. GRAHAM of South Carolina. Mr. President, I ask unanimous consent
that Senator Chambliss and Senator Allen be added as cosponsors.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 2731, As Modified

Mr. GRAHAM of South Carolina. Mr. President, I ask unanimous consent
to add the word ``and'' on page 2 to lines 4 and 16 of my amendment.
The PRESIDING OFFICER. Without objection, it is so ordered. The
amendment is so modified.
The amendment (No. 2731), as modified, is as follows:
On page 28, after line 7, insert the following:

SEC. 304. RESERVE FUND FOR GUARD AND RESERVE HEALTH CARE.

If the Committee on Armed Services or the Committee on
Appropriations reports a bill or joint resolution, or an
amendment thereto is offered or a conference report thereon
is submitted that expands access to health care for members
of the reserve component, the Chairman of the Committee on
the Budget may revise allocations of new budget authority and
outlays, the revenue aggregates, other appropriate
aggregates, and the discretionary spending limits to reflect
such legislation, providing that such legislation--
(1) would not increase the deficit for fiscal year 2005 and
for the period of fiscal years 2005 through 2009, or would
offset such deficit increases through reduction of
unobligated balances from Iraqi reconstruction; and
(2) does not exceed $5,600,000,000 for the period of fiscal
years 2005 through 2009.

SEC. 305. RESERVE FUND FOR MONTGOMERY GI BILL BENEFITS.

If the Committee on Armed Services or the Committee on
Appropriations reports a bill or joint resolution, or an
amendment thereto is offered or a conference report thereon
is submitted, that increases benefit levels under the
Montgomery GI Bill for members of the Selected Reserves, the
Chairman of the Committee on the Budget may revise
allocations of new budget authority and outlays, the revenue
aggregates, other appropriate aggregates, and the
discretionary spending limits to reflect such legislation,
providing that such legislation--
(1) would not increase the deficit for fiscal year 2005 and
for the period of fiscal years 2005 through 2009; and
(2) does not exceed $1,200,000,000 for the period of fiscal
years 2005 through 2009.

Mr. GRAHAM of South Carolina. Mr. President, I will give a quick
overview and yield to Senator Bunning for as much time as he needs to
explain his portion of the amendment. Then we will go to Senator DeWine
and Senator Daschle and myself to finish.
I compliment Senator Nickles for helping us work this out. This is
the amendment we have been talking about for almost a year now, setting
aside some money in the budget to address the health care needs of the
Guard and the Reserve.
If you are an activated member of the Guard or Reserve, you go into
the military health care system called TRICARE. Your family has
eligibility for that system. When you come off active duty, you will go
back into your private plan, if you have one. If you are uninsured,
there will no plan available for you.
We are trying to allow Guard and Reserve members, by paying a premium
out of their pockets, to be full-time members of TRICARE so they will
have continuity of health care.
Twenty-five percent of the people who were called to active duty for
Guard and Reserve were unable to be deployed because of health care
problems. Providing continuity of health care year round would be a
good measure. I know this will help retention and recruiting.
There is another aspect of this amendment, thanks to Senator Bunning.
What is happening with our Guard and Reserve forces is they are
becoming overutilized. There has been a 170-percent increase in Guard
and Reserve utilization since 9/11.
The GI bill of rights applies to the Guard and Reserve in a limited
fashion. Thanks to Senator Bunning's efforts, that is about to change.
At this time, I would like to yield to Senator Bunning to explain
what he is trying to do for the Guard and Reserve members with an
amendment in terms of the GI bill.
The PRESIDING OFFICER. The Senator from Kentucky.
Mr. BUNNING. Mr. President, my amendment provides funds to increase
educational benefits for the National Guard and Reserve members under
the GI bill. Currently, National Guard and Reserve members are eligible
for only $282 per month under the GI bill. That is only 27 percent of
the amount active-duty members can get.

In 1985, Congress set educational benefits for our Guard and Reserve
members at 47 percent of the active-duty

[[Page S2494]]

benefit level. Since then, it has continued to slip to today's levels
of 27 percent. My provision provides the funds needed to bring Guard
and Reserve benefits back to that 40-percent mark.
Today, we are using our National Guard and Reserve, as Senator Graham
said, more than ever. They are being deployed away from their homes and
families for longer periods of time and put in harm's way. We should
provide them with educational benefits that reflect the contributions
they make to our national security.
I urge Members to support the Graham amendment.
Mr. GRAHAM of South Carolina. Mr. President, I thank Senator Bunning
on behalf of all the Guard and Reserves. He has made a real difference
in their lives. This is long overdue. I appreciate what the Senator has
done to make this a better amendment.
I yield 3 minutes to Senator Leahy.
The PRESIDING OFFICER. The Senator from Vermont.
Mr. LEAHY. Mr. President, I am glad to join my colleagues Senator
Daschle of South Dakota and Senator Graham of South Carolina in support
of this critical budget amendment on the readiness of our National
Guard and Reserves. This amendment will allocate resources in the
country's long-term budget to implement a comprehensive health
insurance program for the 800,000 citizen-soldiers who serve in the
National Guard and Reserves.
Last year, the Senate recognized that 20 percent of the Nation's
military reserve--over 150,000 citizens waiting to answer the call-to-
duty--did not possess health insurance. During a vote here on the
Senate floor, 85 senators collectively agreed that this was unwise, and
more importantly, unconscionable that citizen soldiers ready to fight
for their country would arrive for service in less than perfect health
because they were uninsured.
As a response to this clear problem, we passed a stopgap health
insurance program that allowed reservists to receive fully reimbursed
health insurance through TRICARE as soon as they received their orders
and maintain that insurance after they had been deactivated.
The centerpiece of the program passed in Congress last year was a
provision to allow drilling members of the Guard and Reserve to buy
into the TRICARE program on a cost-share basis if they were between
jobs or did not have access to health insurance through their
employers.
This program guarantees that every member of the Guard and Reserve is
covered either through TRICARE or a civilian program. However, the
final defense bill last year authorized the program only through the
end of this calendar year. This amendment would expand funding for this
program for the next 5 years.
More troubling, critical portions of our original proposal, embodied
in S. 852, the Comprehensive Guard and Reserve Health Benefits Act,
dropped out during the final negotiations.
Missing in the final package was eligibility for employed members of
the Guard and Reserve to sign up for the cost-share TRICARE program.
This took away health insurance options for our reservists and a
necessary mechanism to make the mobilization process easier by
eliminating the need for reservists to switch back and forth between
health insurance plans when they are activated.
The final compromise also shortchanged families of activated
reservists who wanted to maintain their civilian health insurance while
their loved ones were activated.
That provision would have substantially reduced some of the intense
disturbances these long separations create. We crafted this provision
to have only marginal costs compared to the size of the benefit for
Guard members, reservists and their families.
This amendment will help fund the full program set forth in S. 852:
Early health insurance, TRICARE access for all, reimbursements to
families for keeping civilian health insurance, and maintaining full
TRICARE after deployment. It truly is a comprehensive package. It is, I
want to note, the exact same legislation that received an overwhelming
85 to 10 favorable vote during our debate on the defense bill.
The Department of Defense has slow-rolled implementation of the
program turned into law last year. They are still not opening up the
cost-share program to eligible service-members. Passing this amendment
this year on the budget resolution sends a signal to DOD that they need
to move ahead more aggressively. But, more importantly, this amendment
assures the 130,000 men and women in the Guard and Reserve serving in
Iraq, Afghanistan, or at home, and the entire Guard and Reserve force,
that we are going to take significant steps to ensure that they are
ready to meet the challenges ahead. We are not going to let our Guard
down.
To reiterate, this amendment will allocate resources in the long-term
budget to implement a comprehensive health insurance program for the
800,000 citizen soldiers who serve in the National Guard and Reserve.
We recognized in the Senate last year that 20 percent of the Nation's
military reserve--over 150,000 citizens waiting to answer the call to
duty--did not possess health insurance. Think of that, over 20 percent
of the military reserve, 150,000 people, with no health insurance. That
is unwise and it is also unconscionable these citizen soldiers do not
have health insurance.
We passed a stopgap health insurance program that allowed reservists
to receive fully reimbursed health insurance through TRICARE as soon as
they receive their orders and maintain that insurance after they have
been deactivated.
Missing in the final package was eligibility for members of the Guard
and Reserve to sign up for the cost-share TRICARE program. We have
crafted a provision at only marginal cost compared to the size for
members of the Guard and Reserve, and this will help fully fund the
program set forth--early health insurance, TRICARE access for all,
reimbursements to families for keeping civilian health insurance, and
maintaining full TRICARE after deployment.
We need to do this. We cannot continue to ask these men and women to
go overseas to serve, basically full time, and have part-time benefits.
They are full-time soldiers. They should be treated that way.
Mr. GRAHAM of South Carolina. I yield 10 minutes to the chief author
of this legislation, Senator DeWine.
The PRESIDING OFFICER. The Senator from Ohio.
Mr. DeWINE. Mr. President, I am proud to join this afternoon my
colleague, Senator Lindsey Graham, in support of this very important
amendment. I commend him for his great leadership and great work.
I have been a longstanding supporter of both initiatives: extending
TRICARE coverage to members of the Guard and Reserve, and also
increasing the level of benefits provided to the Selective Reserve
under the Montgomery GI bill. I have introduced and cosponsored several
bills to address existing inequities with these specific benefits.
Unfortunately, benefits for our Guard and Reserve simply have not
kept pace with the increasing role that these individuals are expected
to play today.
I commend Senator Graham, Senator Daschle, and Senator Bunning for
their great leadership and their continued commitment to these
initiatives. I look forward to working with them through the coming
months to make these important initiatives a permanent reality.
This is important work. I know of nothing more important that this
Senate will be doing in the months ahead. I look forward to making sure
we get the job done.
I thank my colleague for the time this afternoon to talk about
another important amendment that I have filed, but I am not calling up
at this time. I take a moment to talk about this amendment that is
cosponsored by Senator Leahy and Senator Coleman, an amendment that I
have sponsored.
We live in a world of 6 billion people, the majority of whom live in
developing countries. Theirs is a world where, according to UNICEF, out
of every 100 children born, 30 will most likely suffer from
malnutrition in their first 5 years of life; 26 will not be immunized
against the most basic of childhood diseases; and 19 will lack access
to clean, safe drinking water.
This is certainly unconscionable. Yet we have seemingly come to
expect and indeed accept this as a way of life in the developing world.
The tragedy is

[[Page S2495]]

that all of this is avoidable. We can do something about it. We can do
simple things, really simple things, basic things that can save
millions of children's lives every year. The reality is we are not
doing enough right now. Candidly, we are tolerating these deaths, and
saving these lives simply has not been a priority. Our amendment would
change that. And it is, indeed, a step in the right direction.
I take a few minutes this afternoon to share some important
statistics about child and maternal mortality. I am often hesitant to
come to the floor and talk about statistics. When we hear statistics,
it is all too easy to become numb, all too easy to forget the human
realities they, in fact, represent. It is important for all to listen
to some of these statistics today because they are so unbelievable and
so tragic. They represent so many lives, countless lives that could, in
fact, be saved; lives that could be saved if we would make the
appropriate amount of resources available to people who are in such
dire need.
Let's look at the facts. Today, over 10 million children under the
age of 5 die each year from preventable, avoidable, and treatable
diseases and ailments, including such things as diarrhea, pneumonia,
measles, and, yes, malnutrition. Over 10 million children under the age
of 5 die from preventable and avoidable diseases. Of those 10 million
deaths worldwide, 3.9 million occur in the first 28 days of life. These
babies do not even have a shot at living their lives or even getting as
old as 2, 3, 4 or 5. Yet two-thirds of these deaths could be prevented
if available and affordable interventions had reached the children and
mothers who needed them.
Malnutrition contributes to 54 percent of all childhood deaths, and
as many as 3 million children die annually as a result of vitamin A
deficiency. An estimated 400,000 cases of childhood blindness are
reported each year, also, because of vitamin A deficiencies.
According to the World Health Organization estimates, at least 30
million infants still do not have access to basic immunization
services, and over 4.4 million children died from vaccine-preventable
diseases in the year 2001 alone--diseases such as hepatitis, polio, and
tetanus. Of all the vaccine-preventable diseases, measles remains the
leading childhood killer, claiming the lives of, it is estimated,
750,000 children--more than half of them in Africa alone. Yet vaccine-
preventable deaths could actually be cut in half by the year 2005 if
these children were receiving proper vaccinations.

Mr. President and my colleagues in the Senate, we can change the
course of these developing nations. We can change this tragic human
reality. We can start by providing additional money and support for our
child survival and maternal health programs. The fact is, this is an
emergency situation. There really is not any other way to describe it.
Over 10 million children dying each year from preventable and treatable
illnesses certainly qualifies as an emergency.
It is the equivalent of roughly 55 fully loaded 747 airplanes
crashing every day for a year. Think of that. If that were happening,
if that many airplanes were going down each day in this country, or
anywhere in the world, we know what our reaction would be. It would be
all over the news, all over CNN. We would declare a worldwide tragedy,
and we would do something about it.
But these problems facing the developing world cannot be resolved
through short-term, temporary, piecemeal assistance. If we are to make
any real headway in improving the health of women and children in the
long term, we need to take some bold and radical steps, and we also
need to be committed to supporting, in the long run, maternal and child
health programs, and not just now but next year and the year after and
the year after that. Our funding simply cannot be administered in a
single dose.
If we could look into the future 10, 20, 30, 40 years from now, we
would see what is possible with sustained investments in primary health
care and public health systems.
An article recently published in the journal, The Lancet, suggests
that providing, for example, vitamin A as a preventing measure could
avert as many as 225,000 deaths, and providing oral rehydration therapy
could prevent as many as 1,477,000 deaths. Simple interventions and
treatment are not expensive. Oral rehydration salt packets cost about 8
cents apiece--8 cents.
For 4 cents per child, two vitamin A capsules could be given every
year to children around the world, saving over 650,000 of them from
blindness and death. For 30 cents worth of basic antibiotics given to
every child with pneumonia, we could prevent 577,000 deaths. I think
you get the idea.
Here is another example: Iodine regulates growth and the metabolism.
A deficiency in iodine is the primary cause of preventable learning
disabilities and brain damage. Iodine can be introduced into the diet
by something as simple as fortified salt--iodized salt--something that
is in all our kitchens at home. This simple measure would cost only 5
cents per person annually.
Furthermore, our amendment would allocate additional money to help
avert maternal and neonatal death and improve maternal health,
including the prevention of obstetric fistulas and other types of
injuries and disabilities resulting from childbirth in unsafe
circumstances.
The fact is, all pregnant women are at risk for injuries and
childbirth complications, which is why it is so important to have
skilled attendants--midwives, doctors, or nurses--present at birth. Yet
only about half of the world's women give birth with a skilled
attendant available.

The child survival and maternal health funding provides resources so
that USAID can provide training and technical assistance in infection
prevention and quality of care, as well as needed equipment and
supplies to bring health facilities up to a level where they can
provide safe and effective emergency pre- and postnatal care. Clearly,
child survival interventions do, in fact, work, and they are the most
cost-effective tools we have in the struggle for better global health.
We can and we should invest in these programs as they increase
developing countries' access to basic health services--services such as
vaccinations, immunizations, micronutrient programs, and vitamin
supplements.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. DeWINE. Mr. President, I ask for an additional 1 minute.
Mr. GRAHAM of South Carolina. Absolutely.
The PRESIDING OFFICER. The Senator is recognized for an additional
minute.
Mr. DeWINE. If we can make these investments and work toward equal
access to health care, we can help ensure that mothers receive proper
prenatal care, that children and families receive nutritional
counseling and vitamin supplements, and that children receive the
necessary immunizations and vaccinations to live healthy lives.
But tragically, if we fail to make a sufficient and sustained
investment in the development of public health systems that provide
primary care, mothers will continue to die prematurely during
childbirth, children will continue to die from preventable diseases and
causes, and life expectancies in these developing nations will stagnate
or perhaps even decrease. This is not acceptable.
Mr. President, adoption of this amendment--as I said, it has been
filed but not yet called up--will go a long way to save so many
children's lives around the world. Therefore, I would ask my
colleagues, when this amendment is called up, to join my colleagues in
voting in favor of it.
Again, I thank my colleague for his great work to help our Guard and
Reserves in relation to what we talked about earlier today. I thank him
for his good work in this area.
I yield the floor.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM of South Carolina. Mr. President, we are all in a thanking
mode, and I think it is appropriate that we try to do as much as we
can, in a bipartisan fashion, when it comes to the military.
We will have our differences and funding and our differences about
priorities in terms of what helps the economy and what helps to control
the deficit. But I want to acknowledge the work of Chairman Nickles'
staff and him personally for allowing this amendment to be accepted as
part of the budget because working together, in a bipartisan fashion,
we are going to

[[Page S2496]]

carve out about $5.6 billion to be utilized to help alleviate the Guard
and Reserve health care problems that currently exist. And Senator
Bunning's measured, upgraded GI bill benefits will also be part of the
budget. To me, that is a good priority to have made. We have promised
to pay for this. I think that is a good statement to have made, too.
Once the authorizing committee gets to work with Senator Warner, and
then, hopefully, Senator Stevens, who has been a big champion of this
cause, they will appropriate what we do on the authorizing committee,
that it will be paid for, and that we can bring this program in under
the $5.6 billion amount. Senator McCain and others have ideas of how
the employer community can contribute.
But I would like to inform those maybe listening in the Guard and
Reserve community that your needs are well understood by this body, and
there is a real bipartisan effort to meet those needs.
To those in the Active Forces, I think we have tried to upgrade your
benefit package, tried to increase your pay. You have earned every
penny of it, and then some. We are trying to improve the quality of
life of those people stationed overseas and their families.
This is a team effort. Nothing about the Guard and Reserve takes away
from the Active Forces. Forty percent of the people in Iraq, by the end
of the year, will be Guard and Reserve members. When a guardsman or
reservist is called to active duty, it has its own unique stress. God
knows their is stress on our active-duty families who are serving in
the military and have their family members in harm's way.
More times than not, when you are called to active duty, your pay
goes down. There are provisions in our Federal law that will allow some
renegotiating of loans but, at the end of the day, it is a very
stressful event financially for families.
This one aspect, health care, is a huge problem that needs to be
addressed. As I stated before, about one in four people called from the
Reserve and Guard community to active duty are not able to be deployed
immediately because of health care problems. The No. 1 disqualifying
event is dental problems.
When you think about it, a lot of private plans do not have a dental
component to it. So by allowing Guard and Reserve members to be part of
the military health care system year round, whether they are deployed
or not, I think readiness goes up dramatically.
When we look at writing this bill, that would be one of the selling
points. I was in Iraq last summer with a delegation of Senators. The
Presiding Officer was with us. It was a wonderful opportunity to
understand how difficult service overseas can be and how stressful it
is being in harm's way. You come away with a great sense of pride about
all those serving our country. As the Presiding Officer will recall, we
had nine C-130 flights in Afghanistan and Iraq. Eight of the nine crews
were Guard crews. The last was a Reserve crew. All the 130 crews were
from the Guard and Reserve community. That duplicates itself in many
other areas--MPs, civil affairs. There is a heavy reliance on Guard and
Reserves.
I remember on one of the flights the pilot and the copilot were going
to be first-time dads. One person worked for Southwestern Bell.
Southwestern Bell voluntarily extended health care coverage for the
family, even though he was called back to duty, so that person's wife
did not have to change doctors or hospitals. The copilot was a realtor
and he didn't have such an opportunity. So his wife had to change
doctors and hospitals late in the pregnancy, and it was a very
stressful event.
One thing about providing full-time TRICARE eligibility to those who
want to pay the premium, we are asking guardsmen and reservists to
contribute to the cost. That is only fair, and it is a very good deal.
They will be contributing out of their pocket, like their active-duty
counterparts. One of the benefits is, your family doesn't have to
bounce around from one health care provider to another, even when you
change plans. Some people have been deployed already three times. The
likelihood of their utilization in the future is greater, not less.
Adopting this amendment as part of the budget allows us to take some
money to meet those needs.
I need to say this about Senators Daschle and Leahy and Clinton, and
our other Democratic sponsors: We wouldn't be here without Senator
Daschle. I don't know how to say it any clearer. We would not have made
it this far if he had not taken on this cause and pushed as hard as he
could push. He has been around here a lot longer than I have. It really
did matter. He and I may vote differently for the rest of the week, but
I have great admiration for him as a person and we will vote together
today. At the end of the week he may have a different view about what
the budget does for the country, but we will have agreement on this,
that the Guard and Reserve community is one step closer to getting the
help they deserve. I publicly acknowledge that and thank him. It has
been a very pleasurable, enjoyable experience. We are not there yet,
but we are closer than when we began.
I am the only Member of the Senate who is in the Reserves. I recently
got promoted and made a joke about that, showing how stressed out we
are in the military if I am promoted. I am proud of my service. I have
never been in harm's way.
The one thing I got from that experience, having been on Active Duty
for 6\1/2\ years, serving overseas--I was in the Guard as a support
person in Alaska, doing legal work for families and military members
being deployed--I know how stressful it is for families left behind and
how stressful it is for the pilots and their crews.
Here we are 10 years later plus, involved in another major operation
to fight the enemies of this country who, if they had their way, little
girls wouldn't to go school and there would be only one way to worship
God. It would be their way. And if you differed, you would die.
This is a huge event we are undertaking, the war on terrorism. The
Guard and Reserve community is playing a bigger role than ever.
The cold war dynamic with the Guard and Reserve has changed with the
war on terrorism. They are indispensable. That will not change anytime
soon. The stress on the forces is as great as it has ever been in my
military career, and the benefit package has not been changed
substantially in 30 years. Now is the time to come together,
Republicans and Democrats, and put on the table new benefits for those
serving their country in a very patriotic and unselfish way.
With that, I yield to the minority leader and my colleague on this
effort, Senator Daschle.
The PRESIDING OFFICER. The Senator from South Dakota.
Mr. DASCHLE. I thank the Senator for his kind words. I have to say,
this has been an equal joy for me. The Senator from South Carolina has
been an extraordinary partner in this effort. I applaud him for the
extraordinary efforts he has made to get us to this point and the
leadership he has provided. As he has noted, we may disagree on other
issues, but on this there is very strong bipartisan support. I cite his
leadership as one of the reasons why.
I can speak for all of those on this side of the aisle who have
worked to try to pass this legislation. Senator Graham's efforts, his
persistence, and the extraordinary effort he brings to ensuring we
succeed is a big reason why we are going to be successful today.
We have actually voted on this three times in the Senate. We have
done so with overwhelming margins. It is not often on an amendment that
you can generate 80-plus votes. But 87 Senators have already said this
ought to be law. Because they have said it ought to be law, we are
confident it will become law sooner or later.
The legislation we are offering today very simply recognizes, first,
that there are differences between members of the Reserves and the
Active Duty. The Active Duty don't have to pay for their health care.
We believe that is the way it should be. If you are on active duty and
you are defending your country, that ought to be one of the
prerequisites of Active-Duty service. We are suggesting that if you
serve your country alongside that member of the Active Duty, you ought
to have access to that health care, and maybe you ought to pay a little
premium.

[[Page S2497]]

Our guardsmen and reservists are determined and are accepting of that
difference. They just want access to the care. They are willing to pay
a premium, unlike our Active-Duty personnel who get it as part of their
job, but they do want access. So that is the first big difference.
Clearly, what most people don't understand is this premium is a very
significant differentiation between Active-Duty personnel and the
Guard.
The second is, this will not be taken out of the Pentagon budget.
What we are proposing with this amendment is we add $5.6 billion. We
recognize there are some very important needs within our defense budget
that have to be met. We don't want to see this compete with other
needs, and that is why we are adding on. But we are also not adding to
the deficit. There is a significant unobligated balance in the Iraq
reconstruction fund, money that would go to Iraq normally, that is not
going to be required in this fiscal year from which this money is
taken.
So first, we are not exacerbating the deficit. Secondly, we are not
competing with any other programs in the Defense Department. And third,
we recognize the difference between members of the Reserve and Active-
Duty personnel. So for all those reasons, we think this amendment is
very carefully drawn.
Obviously, there is no question about the importance of what it does.
It extends coverage to all reservists who are willing to pay the
premium. You pay the premium; you have access to the health insurance.
Secondly, we provide offsetting coverage when people are called up and
they have private coverage that they want to maintain. We are saying,
if you are called to service by your country and you are fighting in a
faraway land, we are going to ensure that if you have private coverage
that you think is important and you want to keep for your family, you
ought to have a right to do that.

Finally, we make it permanent. We ought to take out the guessing
game. There shouldn't be any question as to whether it is going to be
here this year, gone the next, whether some people are going to have to
sign up, worrying whether they can sign up in subsequent years.
What Senator Graham suggests with our amendment is, No. 1, it ought
to be permanent. We have seen, as the Senator from South Carolina so
aptly noted, the biggest callup of members of the Guard and Reserves
since World War II. Our dependence upon the Guard and Reserves
continues to grow. Forty percent is now the number that is widely
recognized; 40 percent of those serving in Iraq are members of the
Guard and Reserves. So there is no question this integration of forces
is a fact of life.
If we are going to see this integration of forces in the future, we
have to recognize that we are going to have to change our benefits and
pay structure to meet the demand and to put some element of fairness
back into the system.
This amendment is needed for two reasons. One, it is the right thing
to do. When you have 30 percent of those members of the Guard and
Reserves who are called up today who have no health insurance, many of
whom can't even get the kind of health care they need to be compliant
physically with the demands of their job, you need this amendment.
Secondly, when you look down the road and you talk to Governors and
the Guard and Reserve decisionmakers, what they will tell you
privately, and for good reason, is they are understandably concerned
about retention, understandably concerned about meeting the needs.

You will not find more patriotic Americans anywhere than those who
serve through the Reserve and the Guard. Nobody is more committed. They
give up their jobs, time with their families, and they go to faraway
places and sacrifice salary in order to defend their country.
All we are saying is, for all of that, we want you to stay in the
Guard and continue to serve your country, so we are going to be a
little more fair regarding your access to health insurance. That would
be one less problem for them. This amendment does that permanently, and
it deserves to be passed overwhelmingly.
We are not going to ask for a rollcall vote because we have had three
of them. We think the Senate is on record adequately regarding this
legislation. We will be back. This only authorizes it in the budget. We
are going to come back with Defense Appropriations to make sure it is
also a part of the law as we consider the important aspects of public
policy relating to defense in the future.
Again, let me end where I started. Senator Graham deserves great
credit for the effort he made to bring us to this point. I am pleased
that, on a bipartisan basis, we can pass this with an exclamation point
this afternoon. This deserves to be law. This year is the year to do
it.
I yield the floor.
The PRESIDING OFFICER. Who yields time?
Mr. GRAHAM of South Carolina. Mr. President, I yield to the Senator
from Louisiana.
Ms. LANDRIEU. Mr. President, is there 5 minutes available to speak
for the amendment?
The PRESIDING OFFICER. The sponsor controls 1 additional minute. The
minority manager of the bill controls 20 minutes.
Mr. CONRAD. How much time does the Senator need?
Ms. LANDRIEU. Five minutes.
Mr. CONRAD. Mr. President, does Senator Graham wish to retain a
minute of his time?
Mr. GRAHAM of South Carolina. Yes. I will try to yield part of it
back.
Mr. CONRAD. I yield 5 minutes to the Senator from Louisiana off of
our time.
The PRESIDING OFFICER. The Senator from Louisiana is recognized.
Ms. LANDRIEU. Mr. President, I thank those managing the bill, and I
thank the Senator from South Carolina for bringing this amendment to
the floor. I would like to cosponsor this amendment because it helps
our veterans and Guard and Reserve in two very important ways. The
Senator's portion of this helps to extend the TRICARE piece and extends
also in this amendment the GI benefits for the Guard and Reserve.
As I have said many times, the Guard and Reserve that is protecting
us today, that is serving as the core in many instances of our Armed
Forces, is not the Guard and Reserve of our fathers' or grandfathers'
generations. They are citizen soldiers. They are professional soldiers.
Because of policy changes we put into place, the Guard and Reserve now
are picking up about 40 percent of the battlefield burdens, and they
deserve a greater portion of the overall budget to support them.
Do our active troops deserve support? Absolutely. But our Guard and
Reserve, because they are picking up an ever-increasing responsibility
regarding this war against terrorism, the war in Afghanistan and the
war in Iraq, and even right here on the homefront, deserve more help
and support.
I am proud to be a cosponsor of this amendment. I believe it will
pass with great support on both sides.
I wanted to take a minute to also talk about something I hope we can
find a way in this debate to fix. I want to see if we can find a way to
fix the survivor benefit plan, which was enacted in 1972. This survivor
benefit plan was a pension benefit for military spouses, after the
retirees passed away. We said if the retired veterans wanted to
basically pay into a certain account, when the retiree died, their
wives would receive 55 percent of the veterans retirement pay.
We created this fund. However, after it was established, budget
policies were put into place that basically cut out that benefit. So we
now have the unbelievable and untenable situation where spouses--most
of them women; I would say 85 to 90 percent are female--who, by the
request of our military, move themselves and their families every 2
years, which makes it extremely difficult for anyone to develop any
consistency in a career outside the home, even if they were able and
willing. Moving every 2 years doesn't give them the opportunity to
expand their earning capacity. That was a sacrifice many spouses and
their families made to support the men in this case--in most cases--
serving in our military and to support the country.
Yet for all that great commitment and service and dedication, we tell
them, thank you very much, but we are going to cut your benefits from
55 percent of what you and your spouse put

[[Page S2498]]

in, in some instances, down to 32 percent. It is not fair.
There are Senators on the floor--I see the chairman of the Budget
Committee--who say we cannot afford to cut back the tax cut to provide
for this. They say the tax cut is too important and we cannot even
modify it or change it or postpone it or adjust it even in the
slightest amount to pay for that.
I disagree. I think we can find a way to adjust the tax cut to pay
for the widows who moved every 2 years, paid their own money into the
fund, and now they get shortchanged. When we talk about supporting our
military families, let's remember the soldier on the battlefield, and
let's also remember the soldiers who are at home, both the spouses and
children who bear a tremendous burden, who do it willingly and with
great patriotism. Let's not ask them to sacrifice when others in this
country are not willing to make that same sacrifice.
I will be offering this amendment later, supporting the amendment
that is on the floor. Hopefully, we can convince some of the leadership
to make adjustments in their tax cut plans to do some things we need to
do for our men and women in uniform and their families.
I yield the floor.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM of South Carolina. Mr. President, I ask unanimous consent
that Senators Lincoln, Dayton, Murray, Murkowski, and Mikulski be added
as cosponsors.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRAHAM of South Carolina. Mr. President, as Senator Daschle has
described, this will be offset. This will be budget-friendly, and it
will be a huge deal to military Reserve and Guard families who are
sacrificing much for their country. It will help build a better support
network. If you are called to active duty for the Guard and Reserve,
there is no daycare center on base because there is no base in which to
go. There is no counseling service because you are sometimes in a rural
community far away from military bases.
This continuity of health care would help dramatically. I urge its
adoption.
I thank Senator Nickles for making this possible. I look forward to
writing good legislation to help the Guard and Reserve families.
I ask unanimous consent that all time be yielded back on this
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRAHAM of South Carolina. I thank the Chair.
The PRESIDING OFFICER. The question is on agreeing to the amendment
of the Senator from South Carolina.
The Senator from Oklahoma is recognized.
Mr. NICKLES. Mr. President, I compliment my colleague from South
Carolina and the Senator from Kentucky, Mr. Bunning, as well as Senator
Daschle and Senator Conrad. We have no objection to the amendment.
The PRESIDING OFFICER. The question is on agreeing to the amendment.
The amendment (No. 2731) was agreed to.
Mr. NICKLES. Mr. President, again, I compliment our colleagues. I
urge other colleagues, if they have ideas on amendments, to share them
with us and maybe we can work some of them out and eliminate the need
for rollcall votes. Rollcall votes take a lot of time and they also
don't count on the time for the budget resolution.
I have a unanimous consent agreement on two additional amendments. We
have unanimous consent on an amendment by Senator Byrd, dealing with
striking the reconciliation instruction, dealing with taxes on the
resolution. That is limited to 1 hour. That will begin in a moment.
Following that, I ask unanimous consent that an amendment to be
offered by Senators Warner and Stevens pertaining to the Department of
Defense be limited to 1 hour; an amendment by Senator Feingold dealing
with pay-go also be limited to 1 hour, with no second-degree amendments
in order.
The PRESIDING OFFICER. Is there objection?
Mr. REID. Reserving the right to object.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, it is my understanding, listening to my
friend from Oklahoma, the votes will be stacked; is that right?
Mr. NICKLES. That is my intention. I think we can do all these
amendments and probably start the votes shortly before 6. These are
three important issues, so Members should be advised--I know Members on
the Finance Committee wish to speak on a couple of these issues--to be
prepared to debate, and Members should expect three rollcall votes
shortly before 6 o'clock.
Mr. REID. Will my friend also agree to have 1 minute on each side
prior to each vote?
Mr. NICKLES. I have no objection to that request. I modify my request
so that the first vote be on Senator Byrd's amendment and then the
following two votes, and the managers be allowed to have 1 minute each.
The PRESIDING OFFICER. Is there objection to the request as modified?
Without objection, it is so ordered.
Mr. NICKLES. Mr. President, now we will begin consideration of an
amendment Senator Byrd will lay down momentarily to strike the
reconciliation provision.
Mr. President, I suggest the absence of a quorum.
Mr. CONRAD. Will the Senator withhold?
The PRESIDING OFFICER. Will the Senator withhold his request for a
quorum call?
Mr. NICKLES. Yes.
Mr. CONRAD. Mr. President, Senator Byrd is now in the Chamber. While
he is going to his desk to present his amendment, I wish to take this
moment to urge our colleagues to get their amendments to us so we can
review them, so we can eliminate duplication, so we can schedule them
efficiently.
If Senators have an amendment they kind of like but really would not
need to offer, please withhold. We already have 58 amendments noticed.
That is 19 hours of voting. It is going to take discipline if we want
to conclude the business on the budget resolution by Friday, which is
our common goal. I thank the Chair.
The PRESIDING OFFICER. Under the previous order, the Senator from
West Virginia is recognized to offer an amendment. The Senator from
West Virginia.

Amendment No. 2735

(Purpose: To provide for consideration of tax cuts outside of
reconciliation)

Mr. BYRD. I thank the Chair. I call up my amendment.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from West Virginia [Mr. Byrd] proposes an
amendment numbered 2735.
Strike Section 201(a) of the committee-reported resolution,
on page 24 line 21 through page 25 line 3.

Mr. BYRD. Mr. President, for many years, I have been growing
increasingly concerned about the Senate as a forum for debate. Senators
at every turn seem bent upon undermining this institution and the
vision of our constitutional framers embodied in this upper body of the
Congress.
The Senate is the only forum in our Government where the perfection
of laws may be unhurried and where controversial decisions may be
hammered out on the anvil of lengthy debate. It may be slow; it may be
unwieldy; it may be frustrating to some; but it is the best means to
achieving compromise, to ensuring an informed citizenry, to protecting
the rights of the minority. To shut out the minority by limiting the
right to debate is to needlessly and detrimentally infuse partisanship
into the legislative process. That is exactly what we are seeing in
this budget resolution.
Included in the Budget chairman's resolution are reconciliation
instructions to the Finance Committee to report $81 billion in tax cuts
to extend the child credit, marriage penalty, and 10-percent bracket
expansion that are scheduled to expire this year. If misused, there is
no procedural mechanism in the Senate more contemptuous of debate than
the budget reconciliation process, and it is being misused. It is a
process that has morphed into an annual exercise where the majority
party takes advantage of the limitations on amendment and debate
allowed by the

[[Page S2499]]

Budget Act to shield controversial legislation from public discussion.
This budget resolution would use reconciliation to circumvent a
debate in the Senate about the wisdom of allowing additional tax cuts
to deepen the deficit.
I helped to craft the Budget Act in 1974, and I can tell Senators we
never in that day contemplated reconciliation would be used to shield
from debate legislation that spends the Social Security surplus and
increases deficits. We, in that day, never one time envisioned these
abuses of the process.
Senators regularly express their desire for less partisanship,
longing for the days--the days almost beyond recall--when the Senate
accomplished its business without the political acrimony that has
marked recent debates.
One reason the Senate avoided such partisanship is because the
leaders of the Senate respected the rights of the minority and allowed
the Senate to work its will through open and vigorous debate.
In 1981, Republican leader Howard Baker of Tennessee had the
opportunity to use reconciliation to pass President Reagan's tax-cut
package. Did he use it to do so? No. He chose instead to allow the tax
cut to be brought before the Senate as a freestanding bill and fully
debated. He said at the time, and I quote Howard Baker:

Aside from its salutary impact on the budget,
reconciliation also has implications for the Senate as an
institution . . .
I believe that including such extraneous provisions in a
reconciliation bill would be harmful to the character of the
Senate. It would cause such material to be considered under
time and germaneness provisions that impede the full exercise
of minority rights.

Now, that was an extraordinary statement of extraordinary vision by
an extraordinary Senator, Howard Baker of Tennessee. Let me read it
again, and I quote him:

Aside from its salutary impact on the budget,
reconciliation also has implications for the Senate as an
institution . . . I believe that including such extraneous
provisions in a reconciliation bill would be harmful to the
character of the Senate. It would cause such material to be
considered under time and germaneness provisions that impede
the full exercise of minority rights.

That was a statement by a statesman. For almost 20 years, the Senate
exercised restraint with regard to the reconciliation process, and
until 1995 the reconciliation process served as a helpful mechanism for
deficit reduction. Since then, the process has been twisted and
contorted by those who find its limitations on debate and amendment too
enticing to resist, using it to advance a partisan agenda.
The country is the worse for that legislative opportunism. Would that
Howard Baker could again speak from these desks.
Today, the White House is projecting deficits at an alarming $521
billion for the fiscal year 2004. To pay for its tax cuts, the Bush
administration is spending every dime of the Social Security surplus,
money that the President and both parties pledged to set aside to save
our retirement and disability system. According to the White House's
own numbers, the gross debt just passed the $7 trillion mark on its way
to $11 trillion in 2009, and there is no credible plan from this
administration or this Congress to do anything about it.
In response to mounting budget deficit projections, President Ronald
Reagan signed into law 12 bills to increase taxes, including
legislation to repeal part of his 1981 tax cut. Similarly, in response
to alarming deficit projections in 1990, President Bush's father made
the courageous decision to break his no new taxes pledge.
State legislatures and Governors have been making similar decisions
over the past 3 years in Alaska, Alabama, Connecticut, Idaho, Nebraska,
Nevada, and Ohio. It is what is being debated right now in Richmond,
VA.
Senator Warner recently and courageously declared: Politics be
damned. Let's consider what is best for the men and women and their
families and children.
The debate about budget deficits is taking place all across this
country. Ironically, the one place where debate is discouraged on this
matter is right here in this so-called greatest deliberative body in
the world today. The tax cut reconciliation instructions in this budget
resolution would stifle a debate when it is most needed.
After 3 years of tax cuts and promises of job growth, the country has
not reaped the benefits of those promises. We can tout higher economic
growth rates. We can tout higher productivity. But none of these
statistics mean anything to an unemployed worker. So far there seems to
be no robust connection between these particular tax cuts and job
creation.
Since January 2001, 2.2 million jobs have been lost. The
manufacturing sector has endured 43 straight months of job loss.
Discouraged workers are dropping out of the labor pool at a rate of
100,000 per week. One million jobs have been lost overseas. Countless
workers, white-collar workers and blue-collar workers, are worried that
their own jobs may be next.

The only thing we know for sure at this point is that tax cuts over
the past 3 years have contributed to an explosion in debt. Just look at
page 189 in the historical tables of the President's budget. After
dropping to a low of $5.6 trillion in the fiscal year 2000, the gross
Federal debt has increased to $5.8 trillion in the fiscal year 2001 to
$6.2 trillion in the fiscal year 2002 to $6.8 trillion in the fiscal
year 2003, and it will continue to increase to an estimated $10.6
trillion in the fiscal year 2009. These figures are beyond all
comprehension.
It is not just election year rhetoric. The IMF, the GAO, and the
Federal Reserve are all in agreement that deficits do matter, and they
are threatening to derail the economy of the United States.
That is not all. The deficits also are threatening our ability to
save Social Security. I understand why some would prefer not to engage
in a lengthy debate about the explosion in the gross debt. The American
public already is having trouble understanding why the Congress should
enact the $1.2 trillion in new tax cuts included in the President's
budget before we have even figured out how we are going to pay for the
cost of the ongoing operations in Iraq.
The budget resolution includes $30 billion in funds for ongoing
operations in Iraq. And that figure is only in here because of the
thoughtfulness of the distinguished chairman, only because of his
thoughtfulness and foresight in putting the figures in here. The
administration downtown didn't put a penny in, not one thin dime.

But that $30 billion is even less than what was included in the House
budget, $20 billion less than what the administration intends to ask
from the Congress, and only enough to finance the first 6 months of the
5-year span in the budget resolution.
The deficits embraced by this budget resolution will prevent the
Congress from allocating any money to address the threat to the Social
Security system, even though the Social Security actuaries estimate $1
trillion will be needed to finance the transition costs under the
options proposed by the President's Social Security Commission.
Reconciliation protects additional tax cuts from public discussion
about the size of the financial burden that will be passed on to our
children and our grandchildren, and it leaves hanging questions about
deficit and debt and balanced budgets that are clearly on the minds of
the American people.
We have hard choices to make that may bring to bear enormous change
in our Nation. We should not do so silently. This is no time to sweep
problems under the rug. At the very least, we have a duty to the future
to discuss and debate so that the public, the people out there looking
at us through those electronic eyes behind that Presiding Officer's
chair will know our reasoning and hold us responsible, hold us
accountable. We should lay down a record so that, if in the end our
choices are right, they may have in our example a good and steady guide
and they may then say, ``Well done, thou good and faithful servant. . .
.'' and so on. But, also so if destiny so transpires that our choices
were wrong, others will not repeat our mistakes.
If we have learned nothing else from the events of the past year, we
certainly should have learned the absolute necessity of debate in our
democratic Republic. We should have learned the folly of failing to ask
questions, of failing to probe and to delve, failing to do our duty as
the elected representatives of the people of this great Republic. I

[[Page S2500]]

would think by now we should have learned the dire consequences of our
failure to insist on debate. The Senate must not shirk its
responsibility to engage in debate about these issues.
With the American public, according to recent polls, in such stark
disagreement with the current course of our Nation's economic and
budget policies, it is time for the Senate at long last to finally
engage in an honest debate about the fiscal course laid out by this
administration.
In recent weeks the chairman of the Budget Committee has expressed
his desire to address the expiring child credit, the marriage penalty,
and the 10-percent bracket tax cuts through the regular legislative
process. The chairman of the Finance Committee has indicated his belief
that including those tax cuts in the reconciliation bill would create a
needlessly partisan debate.
The Senate needs time to explore these views. While these
reconciliation instructions are viewed by some as only a backup plan if
both the House and Senate pass a budget resolution with tax
reconciliation instructions, the decision about whether to use
reconciliation may be taken out of our hands. The House can force us to
take up a reconciliation bill in the Senate containing tax cuts.
The American public deserves the opportunity to better understand how
these tax cuts will affect our mounting budget deficits, and to probe
whether these tax cuts should be offset. We should allow the Senate to
have its debate, not stifle it.
That is the issue on which we will vote. A vote to strike the
reconciliation instructions is a vote to allow the Senate to engage in
an informed debate. That is what I want. I want an informed debate.
That is why I am suggesting we strike these instructions, so we may
engage in an informed debate about how to prevent the further deepening
of the deficit, and a further worsening of the bitter atmosphere that
has, regrettably, engulfed this body.
I urge Senators to vote to strike the tax cut reconciliation
instructions.
I ask unanimous consent to add Senators Conrad and Baucus as
cosponsors of my amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BYRD. I ask unanimous consent to reserve the remainder of my
time. How much time do I have?
The PRESIDING OFFICER. The sponsor of the amendment controls an
additional 8 minutes. The majority bill manager controls 30 minutes.
Mr. BYRD. I thank the Chair.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I compliment my friend and colleague from
West Virginia. He is my friend. He is a valued member of the Budget
Committee. He has been on the committee for a couple of years, and I
very much enjoyed his participation with us on the Budget Committee.
As a matter of fact, one of my fondest moments, I will tell my friend
from West Virginia, in my tenure as Budget chairman, occurred last
year. We were in the process of marking up the budget. My first
grandson was born. That happens to be day after tomorrow I celebrate
his birth. You acknowledged it with a very nice poem, and I want to
thank you for that.
Mr. BYRD. Will the Senator yield?
Mr. NICKLES. I will be happy to yield.
Mr. BYRD. You know, my wife and I are the proud possessors of two
great-grandchildren, just within the last month. The distinguished
chairman's grandson, and Erma's and my great-grandchildren, each of
them owes, as of this past Monday, $24,253.36 on the national debt of
the United States. My amendment is for the purpose of keeping down this
debt and not increasing the deficit.
Mr. NICKLES. I appreciate my colleague's comment. I appreciate the
earnestness with which he says it and makes his case very forcefully,
but I am going to urge the opposite side.
Let me say, I don't totally disagree with my friend and colleague
from West Virginia. I regret it appears we probably need reconciliation
at times to get things done in the Senate. My colleague from West
Virginia opined about the great days years past when Howard Baker was
majority leader. I remember that very well. I remember passing great
tax bills. We actually passed a tax bill in 1981, and in 1986--by 1988
the maximum tax bracket went from 70 percent to 28 percent. The Senator
from West Virginia is right, it wasn't done under reconciliation.
But I also say the climate was much better in the Senate. There was a
lot more cooperation in the Senate. The Senate was more civil and I
wish the Senate would return to those days. I hope we don't need
reconciliation to pass the bills we are advocating or encouraging the
Finance Committee to do. I think it should be able to be done without
reconciliation, if the Senate would work the way it should work.
The Senator from West Virginia knows, though, things have changed.
Unfortunately things have changed a lot in the Senate. We used to not
have filibusters on judges, never had them in the history of the
Senate. Now we have six individuals we can't confirm because they
happen to be nominated to an appellate court.
We have a situation today where we can't even get bills, in some
cases that have been approved by the entire Senate unanimously--we
can't even get conferees appointed. Senator Enzi from Wyoming sponsored
a bill that has strong bipartisan support. The Workforce Reinvestment
Act passed the Senate unanimously, and we can't get conferees
appointed.
I am troubled by how difficult it is or how partisan it is to do a
lot of work in the Senate.
Last year, yes, we used reconciliation to pass a tax bill and the tax
bill was a jobs growth bill. To help the economy we did it, and frankly
it worked. If we hadn't used reconciliation last year, it wouldn't have
passed. The only reason I was advocating, reluctantly, that we use the
reconciliation process to pass it was because I thought it was the only
way we could pass it. In days of old, you could pass legislation in the
Senate with a majority vote, but a lot of times people think we need to
have 60 votes to pass everything. I think that is a serious mistake.
The tax bill we did pass last year did cut taxes on dividends.
We used to tax corporate dividends higher than any other country in
the world. We slashed that tax by half--in some cases more than half--
and it worked. We cut the capital gains rate from 20 percent to 15
percent, and it worked. We set the maximum rate for individuals as the
same rate for corporations--35 percent--and it has worked. The economy
really did start to move. The reconciliation process and expedited
procedure helped us to do things that, frankly, in the past we couldn't
have done under normal procedures. The only way to make sure there is
not a tax increase on my daughter and, frankly, on my grandson is to
make sure we have reconciliation.
I appreciate Senator Byrd saying the amount of debt per child born
today is very significant. I want to reduce that. We have a budget that
is the most significant deficit reduction package before this Senate in
years--maybe decades, maybe ever. We take a $477 billion deficit and
reduce it in half in a couple or three years. That is not easily done.
I don't think we should raise taxes on American families by not having
this reconciliation process. I am afraid that is what will happen.
Some people say you want to give additional tax cuts. The truth is,
we want to keep the tax cuts that are now in law. We don't want to have
tax increases on American families. If we don't have this
reconciliation process, that may well happen. It may be that some
Members, for partisan reasons or whatever, would say: I just do not
want that to happen. I know President Bush really wants it, and,
therefore, they might work hard to see that it doesn't happen. What
happens if that is the case? If the tax bill, which is current law, is
not extended, there will be a tax increase on American families.
To give you an example, a couple that has taxable income of $58,100--
that is not a particularly wealthy family; I think most of us would say
that is a middle-income family--this year, under present law, will pay
$6,000. If we don't keep present law, their taxes will increase to
$7,600; that is for a family of four.
I will outline it. With the provisions that we are assuming in
reconciliation, the Finance Committee can reconcile anything. If we
give them $80 billion and say, reconcile the tax reduction, we are
assuming--presuming maybe--they would extend present law. We are

[[Page S2501]]

not trying to cut taxes further than they are in the year 2000. We are
just trying to keep the present tax law from increasing. If we don't do
it, they will find with the tax credit we have now that the $1,000 a
child goes to $700. That is a $300 tax increase on that family. If they
have two kids, that is $600. If they have four kids, that is $1,200.
Last year we also did something that a lot of people do not
understand but it is very significant in the Tax Code. We have the most
significant reduction in the marriage penalty--the imposition of taxes
on people and penalizing them because of the fact they are married. It
is a higher income tax on couples as compared to individuals. We have
the most significant reduction of that tax in history. We basically
said for at least the couple they should pay the 15-percent bracket.
Basically they should have to double the amount of income that an
individual has on the 15-percent bracket. It should be doubled for
couples. Individuals who have taxable income pay at the 15-percent
bracket--taxable income up to $29,000. We say that should be $58,100
for a couple.

If we don't extend present law, they will have a tax increase of
$900. They will be paying 25 percent, not on income above $58,100. They
will be paying 25 percent above any income above $42,000. That is a
$900 tax increase, if we don't extend present law for a married couple.
My father-in-law and mother-in-law are both retired. Their income is
in this category. I don't want them to have a $900 tax increase. I
don't want my son and my son-in-law and my daughter to have a $900
increase. I want them to be able to get a $1,000 tax credit. It costs a
lot of money nowadays to raise children and to educate children.
We also have an expansion of the 10-percent bracket as well. More
people pay more who have a greater amount of income. They pay a 10-
percent tax instead of 15 percent. That tax rate used to be 15 percent
and was reduced to 10 percent, and we expanded the amount of income
covered under that.
To make sure people understand, we are trying to extend present law
to make sure that a couple with a taxable income of $58,100 will not
have a $1,600 tax increase if they have two kids. If they have four
kids, it would be a $2,200 tax increase. I didn't want that to happen
to American families.
One way of making sure it doesn't happen is to have reconciliation
protection so we can pass a bill. If we get bogged down politically and
Senator Grassley and Senator Baucus can't get it worked out, if there
are endless amendments and people will say we are going to keep
amending this thing forever, you will never get an agreement to finish
it. It is nice to have at least in the arsenal to get things done a
reconciliation process where it can guarantee that we don't increase
taxes on American families. That is why this reconciliation provision
is in there. It is not a lot of money.
We are assuming, according to the Congressional Budget Office, almost
$12 trillion of revenues to be generated to the Federal Government
under present law over the next 5 years--$12 trillion. I will tell my
colleague from West Virginia that we are only reconciling $81 billion
out of $12 trillion.
Again, I don't consider that new taxes. That is extending present law
for American families--for low-income and middle-income American
families primarily. They will be the big beneficiaries of this.
I have the greatest respect for my colleague and friend from West
Virginia. But I urge our colleagues to vote no on the amendment to
strike reconciliation because this is our resource if people are
obstructing passing bills. It seems to be more prevalent all the time
in the Senate today. Let us maintain some protection for the American
taxpayer by using reconciliation, if we have to. We can make sure these
tax increases of $1,600 or $2,200 for a family of four do not happen.
Let us not saddle American couples with a $900 tax increase. Let us
make sure we protect taxpayers and American families. I am afraid,
unfortunately, we need reconciliation as an option to make sure they
aren't faced with a big tax increase.
I yield the floor.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, may I get 3 minutes?
Mr. BYRD. I yield 3 minutes.
Mr. CONRAD. Mr. President, let me say we don't need the
reconciliation process to extend the middle-class tax cut the chairman
has referenced. I support and I will work to get votes to extend the
$1,000 childcare credit, to extend the marriage penalty relief, and to
extend the 10-percent bracket. I am absolutely confident that we can
get the votes to do that outside of reconciliation.
What is wrong here is to use reconciliation for tax cuts.
Reconciliation, which is a fast-track process in the Senate that limits
our right to debate, that limits our right to amend, is used for
something other than deficit reduction. The only reason Senators agreed
to give up their basic rights was because we were in a crisis that
required deficit reduction. This is adding to the deficit--not reducing
it. The chairman said this budget before us has a record amount of
deficit reduction. This budget before us has a record amount of debt
increase. This budget before us will increase the debt of the United
States by $2.86 trillion over the next 5 years.
The former Budget Committee chairman, Senator Domenici, said this
about reconciliation:

Frankly, as chairman of the Budget Committee, I am aware of
how beneficial reconciliation can be to deficit reduction.
But I am also totally aware of what can happen when we choose
to use this kind of process to basically get around the Rules
of the Senate as to limiting debate. Clearly, unlimited
debate is the prerogative of the Senate. That is greatly
modified under this process. I have grown to understand that
this institution, while it has a lot of shortcomings, has
some qualities that are rather exceptional. One of those is
the fact that it is an extremely free institution, that we
are free to offer amendments, that we are free to take as
much time as this U.S. Senate will let us to debate and have
those issues thoroughly understood both here and across the
country.

Finally, the simple fact is, the reconciliation instruction in this
budget resolution doesn't assure that those tax cuts--the middle-class
tax cuts--will be the ones that are, in fact, brought back to us by the
Finance Committee. We all know the budget resolution does not make the
specific decisions of how the revenue is raised by the Finance
Committee.

The chairman of the committee has said over and over in the Senate,
we do not control the specifics of what the Finance Committee does. All
this reconciliation instruction does is give $80 billion to the Finance
Committee. They can use it for any tax-cutting purpose.
Again, we can have an extension of the middle-class tax cuts, $1,000
child credit, and 10-percent bracket, the marriage penalty relief
without the blunderbuss of reconciliation.
The PRESIDING OFFICER. The time of the Senator has expired.
The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I will be brief with a couple of
comments.
According to the Department of the Treasury, if Senator Conrad is
correct, we give the Finance Committee an instruction and they can do
whatever they want, but these three provisions I mention are the only
ones that expire at the end of this year that have a lot of popular
support because they affect millions of people.
The Treasury Department says if these are not extended, 94 million
taxpayers would receive an average tax increase of $538 if we do not
extend these three. Seventy million women would see their taxes
increase on average $662. Forty-six million married couples, including
my son-in-law and daughter, including my father-in-law and mother-in-
law, 46 million married couples would pay on average an additional $906
in taxes. Thirty-eight million families with children would incur an
average tax increase of $902. Eight million single women with children
will see their taxes increase on average by $368. Eleven million
elderly taxpayers would pay on average an additional $383. I could go
on.
This is important to protect these families, these citizens, these
women, these children from a tax increase. I am afraid that
reconciliation is the only tool we can have to almost assure them they
will not be straddled with a big tax increase for next year.
I reserve the remainder of my time.
Mr. BYRD. Mr. President, how much time remains?
The PRESIDING OFFICER. The Senator from West Virginia controls an
additional 5 minutes.

[[Page S2502]]

Mr. BYRD. I thank the Chair.
The distinguished chairman has alluded to the sometimes ill will that
exists increasingly within our own premises. That ill will is often
engendered by the meddling of the White House. The White House should
not meddle in the business of the Congress. Congress should pass bills
and the President can decide whether to sign or to veto them.
Last year, the President stepped in late in the debate on the Omnibus
appropriations bill and forced the conferees to drop protection for
workers to earn overtime. He forced us to change the media ownership
rules in order to protect large corporate interests. We should not
allow the President to force the Congress to consider legislation
through reconciliation.
Moreover, I say to my friend from Oklahoma, this amendment is not
about tax cuts. It is about paying for tax cuts. This budget resolution
assumes that our gross debt will grow to $10.6 trillion by 2009. This
resolution does nothing to address the staggering debt. In fact, it
assumes $144 billion of additional tax cuts with $81 billion of tax
cuts cloaked within the protection of reconciliation. We should insist
on a full debate on whether these tax cuts should be paid for.
We do not need reconciliation to get things done. In 1981, we passed
President Reagan's tax cuts without reconciliation. Reconciliation was
designed to pass difficult legislation that would help to reduce the
deficit. It was not designed to pass tax cuts. We are facing huge
deficits. We should have an opportunity to actually debate whether
additional tax cuts should be paid for.
May I say to my chairman, I respect him greatly. I am sorry he has
voluntarily elected to leave the Senate and not chair the committee. I
have tremendous admiration for him. I have always enjoyed his
friendship and my associations with him, and I shall long miss him.
I hope, on the note on which we have been playing, Senators will
support my amendment.
Does my chairman wish any further time?
Mr. CONRAD. How much time?
The PRESIDING OFFICER. The Senator from West Virginia controls 1\1/2\
minutes.
Mr. BYRD. I yield that time to my chairman.
Mr. CONRAD. I thank the Senator.
I yield 5\1/2\ minutes off the resolution and the minute and a half
that we have in addition for a total of 7 minutes to the Senator from
Montana, the ranking member of the Senate Finance Committee.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, all Members ought to think and reflect
upon this amendment and how important this amendment is. First of all,
let me explain what this amendment does and what it does not do.
What does it not do? It does not prevent any of the middle-income tax
cuts we all want to extend. It does not do that. It does not prevent
those tax cuts. It does not prevent Congress from enacting an extension
of those tax cuts that we all want to extend. This amendment has no
effect on that.
What does it do? It says we should not use the regular Senate rules
in deciding whether to extend and how to extend the middle-income tax
cuts; that is, the child tax credit, the marriage penalty, and the 10-
percent bracket. It says no, create a special rule. Do not use the
regular order, the regular standing rules of the Senate in determining
how and in what way we extend those middle-income tax credits. This
amendment does say do not do that. And Congress will extend those
middle-income tax cuts. That is not the issue. We are going to do that.
The issue is twofold. One is, should we pay for them or not? That is
the issue. And there are lots of ways we could pay for it, lots of ways
that are virtually painless. What are those virtually painless ways?
Closing a lot of tax loopholes. There are countless tax loopholes that
we can pass very quickly, shelters that are ripping off American
taxpayers, post-Enron provisions. There are a host of them. We talk
about SILOs, for example. We know we are about to find in the Finance
Committee other shelters being used that are not widely known.
That is why we are saying this is a two-for. We are saying to extend
the middle-income tax credits, tax provisions, child tax cut, and the
10-percent bracket, and at the same time we are going to clamp down on
some tax loopholes. I am not being facetious or joking about this. This
is real. There are immense loopholes we can and should close down. I
know the Presiding Officer agrees, as most Members would agree. This is
a two-for.
We are saying, let's get that two-for, get both of those passed. And
we have to pass the amendment of the Senator from West Virginia to do
that; otherwise, we are saying change the Senate rules, extend these
tax cuts but do not pay for them, do not enact those shelters.
I also add, we have a moral obligation.
We have a moral obligation, I believe, as Senators, as
representatives of our people, to leave this place in as good a shape
or better shape than we found it. That pertains to the environment.
That pertains to the budgets. That pertains to all we do. We are
entrusted with such responsibility as U.S. Senators.
And, my Lord, it seems to me, right off the top, at the very least,
we could cut back on the irresponsible, large deficits and debts we are
going to be leaving our children and our grandchildren. That is a moral
obligation you have, I have, and each Member of this body has.
By adopting the amendment of the Senator from West Virginia, we can
make good on that moral responsibility, that moral obligation, by
saying, sure, we are going to extend the tax cuts, as well we should,
but we are going to do it in a responsible way; we are not going to add
to the budget deficit; we are not going to add to the debt. It is the
only right thing to do. I urge my colleagues, therefore, to pay very
close attention to the Senator's amendment and to adopt it.
I might add, there are other issues. I do not think these have been
thought through very much. Let me just explain.
The budget resolution instructs the Finance Committee to decrease
revenues by $80.6 billion. This is intended to cover the extension, as
I mentioned, of expiring middle-class tax cuts--the 10-percent bracket,
the marriage penalty, and the child tax credit. The instruction for
this tax bill does not, however, include any instructions to increase
outlays.
Why is that important? It is very important. It is an instruction for
tax cuts. Why am I saying we need to also increase outlays? It is not
called for in the budget reconciliation provision. I say so because
these specific tax cuts also require outlays. That is because there is
a refundable part of these tax cuts. Let me explain it.
The child tax credit provides a $1,000 per child tax credit for low-
and middle-income families. There are some working, low-income families
that do not have income tax liability that this credit can be used to
offset. Even so, they are out there working every day paying a good
chunk of their paycheck in payroll taxes. For these families whose
income does not qualify, we provide, in the law today, as you know, a
refundable child tax credit. They do not have the income liability to
offset, so they get a refund from the Treasury, and this scores for
budget purposes as an outlay.
These reconciliation instructions tell us to extend the child tax
credit. But we know that if we extended the child tax credit for all
the families that currently receive it, it would take about $20 billion
in outlays. But the reconciliation instruction fails to include this.
It does not even mention it. In fact, by definition, therefore, we
cannot increase outlays.
So what does this mean? The best I can figure it, it means we should
extend the tax cuts for all families--except for the working poor. If
middle-income families deserve to get the $1,000 child tax credit next
year, then why not low-income families?
We have heard many times this week: Families should not see their
taxes increase next year. We should extend the current tax relief. So
why does this budget leave the working poor families behind?
There are about 26 million families that receive the child tax
credit. About 8 million of these families receive some refundable
credit. That is almost one-quarter of all child tax credit recipients,
families making between $10,500

[[Page S2503]]

and $26,000. Three-quarters of families deserve an extension of the
full child credit but not the remaining one-quarter? This does not make
sense. Give me a break.

Who are the families that will be left behind? Let's think about that
a second. A single mother of one, making $17,000 a year is left behind.
A couple, both working full time at minimum wage is left behind. What
other type of family is going to be left behind? Military families.
There are a couple reasons for this.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. BAUCUS. Mr. President, I ask unanimous consent for 2 additional
minutes.
Mr. CONRAD. Mr. President, I give the Senator 2 minutes off the
resolution.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
The Senator is recognized.
Mr. BAUCUS. Why are military families left behind under this
reconciliation instruction?
First, there are many military families that have incomes between
$10,000 and $26,000 a year. Roughly, 200,000 military personnel fall
within this income range. They all get the refundable child tax credit.
But under the reconciliation provisions, which the Senator from West
Virginia wishes to delete, they would be left behind. They do not get
any help.
Second, there are many military personnel with higher incomes who
receive the refundable child tax credit. But why do the higher income
people receive the refundable child tax credit? That is because they
have been called to serve in combat zones. Why is that relevant? Well,
the income military personnel receive when they are in a combat zone
does not count for income tax purposes. That means it also does not
count for purposes of determining the child tax credit. How many are
those? At least 40,000. So even though these families make more than
the $26,000, they are receiving the refundable child tax credit because
they are in a combat zone.
So roughly a quarter of a million military families are being cut out
by the Budget Committee's reconciliation instructions. Families that
receive the refundable credit simply because they are serving in a
combat zone or simply because they are serving in the military--all
these families will be left behind.
We all agree, extending the child tax credit is critical. So why are
so many families being excluded?
This reconciliation instruction will not work the way it should. It
is not right to cut so many low-income people off and out of the child
tax credit. That is wrong. So let's work together. Let's use the
regular order and the Senate rules so we can fix some of these
discrepancies that exist in the current budget resolution.
I urge my colleagues to support the amendment of the Senator from
West Virginia. It is the right thing to do.
The PRESIDING OFFICER. The Senator's time has expired.
Who yields time?
Mr. GRASSLEY. Mr. President, I yield myself up to 15 minutes of our
17 minutes for remarks I will have on the subject.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, first of all, I think, based upon my
close working relationship with the Senator from Montana and our work
on guiding the Finance Committee, from what he said, I have just one
disagreement with his position. I think the difference between what he
said and the position I am taking is that I, myself, as leader of the
committee, want to do things through regular order. I think we can do
things through regular order.
But just in case we cannot, since this tax policy is so important to
working men and women--not increasing their taxes next year is so
important--I want the insurance policy a reconciliation package gives
us, just in case there is something unpredictable out there.
Now, I do not think I would have said that same thing in 2001, I
would not have said that same thing in 2003, where I believed we needed
to absolutely pass something that was going to be so controversial that
it would not pass maybe except by reconciliation.
In this particular case, I believe we are going to have the spirit,
the bipartisanship to get this stuff done without going through
reconciliation. So I think that is the only place I disagree with my
colleague. In other words, I am speaking for the budget resolution as
it came out of the Budget Committee.
But what we are setting the stage for is a debate on whether the
Finance Committee will have an opportunity to reduce taxes for families
and children or, in this particular case where we already have these
tax reductions in place, to keep them from automatically, without a
vote of the Congress, going up next year.
I want to underscore the word ``opportunity,'' because that is what
this debate is all about today on the budget resolution, an
opportunity--with some assurance because of reconciliation as a shotgun
behind the door--for tax reduction.
This vote is not about the tax reduction itself. That debate and vote
will come later, on the product of our committee, the Finance
Committee, when we mark up tax reduction legislation. This vote today
is about whether we will consider the tax reduction under
reconciliation or the possibility of using reconciliation because
reconciliation, just plain and simple, as we sit here today, is the
only way that we can guarantee tax relief to the American people in a
timely fashion.
Now, there have been some very strong statements made by some on the
other side of the aisle about tax relief and about reconciliation. Let
me say to those who are worried about this instruction, I, as chairman
of the Senate Finance Committee, plan to use this as a backstop, not as
my primary tool.
My hope is that we deliver family tax relief through regular order. I
will not use this instruction, should it survive this vote in
conference, unless we have to. We have reconciled tax cuts on several
occasions--1995, 1997, 1999, 2001, and we did it last year.
The opposition is not based on precedent. The precedent is very
clear. The measures we are talking about are supported on both sides of
the aisle. I am talking about the child tax credit, the marriage
penalty relief, and expansion of the 10-percent bracket.
Let's be clear. If the Congress does not act, we are talking about a
tax increase for nearly every American who pays taxes. It will also
help out a lot of low-income families with a refundable child tax
credit, if we can deliver this relief. That is another thing I would
suggest to people on the other side. If they want a refundable child
credit and we get into a hassle where it cannot be done through regular
order, it would seem to me they would want to have a process of
reconciliation because it guarantees finality. You never get anything
until you get to the finality of votes.
A bigger tax credit is a better tax credit. A tax benefit under
refundability of $300 per child means a lot to hard-working men and
women in my State, and every State. Keep in mind the opposition has no
problem with raising taxes in reconciliation. Somehow that is OK. It
has been done many times. If the 1993 Clinton tax increase were
repealed today, it would score over $1 trillion over 10 years. Who is
to say that a $1 trillion tax increase is appropriate in
reconciliation, that somehow you can use the process of reconciliation
guaranteeing finality, cutting off debate after 20 hours, OK, if you
want to raise taxes. That would be for a $1 trillion tax increase. But
somehow it is wrong to do it for a $90 billion tax reduction.
Democrats, in 1993, used reconciliation--within their rights from our
view--to further their President's program, a partisanly designed major
tax increase. Eleven years later, we are faced with a different
situation, though I am hopeful more than one Member on the other side
will support the final product. Republicans, by a razor-thin edge,
control the Congress and have a President of our party in the White
House.
I want to make another point that, for those of us on this side of
the aisle, is very compelling, especially in the context of our side's
concessions in the power-sharing agreement. We believe the Byrd
amendment should not be necessary. Reconciliation affords us a backstop
to ensure that tax relief stays in place. I hope the Finance Committee
will not need reconciliation. Hopefully,

[[Page S2504]]

one way or the other, we will get this tax relief.
A vote against the Byrd amendment is a vote for an insurance policy
that tax relief will get to American families.
In closing, I point out this would be a hypothetical family, but
presently for the year 2004, this family would be paying $6,000 a year
in taxes. If we don't do anything before this year is out, then
automatically certain provisions are going to expire. This family,
starting January 1, 2005, is going to be hit with a 26-percent tax
increase. You can see it would go up $600 because the $1,000-per-child
tax credit would expire. When the marriage penalty relief expires, that
family is going to pay $911 more. Why? Just because they are married.
If they weren't married, they wouldn't be stuck with this, if they were
filing separately. Then because they are going to have expiration of
the 10-percent bracket expansion, they will pay $100 more. That is
$1,611 more in taxes because of inaction by this Congress.

That is wrong. We have a chance to do something about it. We ought to
do something about it. I think we can do something about it in a
bipartisan way through regular order. But in case we cannot, because
this body gets locked up too often--call it a filibuster, it is locked
up, no finality. It takes a 60-vote supermajority to overcome it;
sometimes you can't overcome it. Then for this family, they ought to be
entitled to a reconciliation, shotgun, behind-the-door process so we
can guarantee them no tax increase.
It is one thing for us to vote a tax increase: it is another thing to
have a tax increase because of inaction by this Congress. That could
happen. I don't want that to happen. It doesn't have to happen this
way. We can use regular order. But we ought to provide some assurance
to this family that they don't get a 26-percent increase in taxes.
I yield the floor.
The PRESIDING OFFICER. Who yields time?
The Senator from Oklahoma is advised he has 7 minutes remaining.
Mr. NICKLES. I compliment my friend and colleague, the chairman of
the Finance Committee. He and I were elected to the Senate together in
1980. We have been friends ever since. I absolutely love a person who
has intensity on issues. I love a person who likes to get things done.
I love it when we actually do something that makes American families
better.
The tax bill we passed last year helps American families. It helps
this family with a taxable income of $58,000. I don't know how many
times I have heard that the tax cut is a tax cut for the wealthy and
the rich. That is hogwash. This proves it. A married couple making
$58,000 in taxable income, if they have two kids, saves $1,600. That is
real. That is significant. Frankly, it happened in large part because
of the chairman of the Finance Committee, Senator Grassley. I
compliment him for his work and his speech. He is exactly right.
I want to help American families. That is the reason we want to
preserve this option. I compliment Senator Grassley. I urge our
colleagues to vote no on the Byrd amendment when we vote.
For the information of our colleagues, I expect we will have three
rollcall votes probably at 6 o'clock.
I yield back the remainder of our time on this amendment.
Mr. CONRAD. Might I just take 30 seconds off the resolution?
Mr. NICKLES. I will withhold.
The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. CONRAD. May I say to my colleagues, I have not heard a single
Senator who is opposed to extending the middle-class tax cuts. I have
not heard a single Senator who is opposed. There is no need for this
reconciliation instruction for the purposes of tax reduction. The fact
is, this budget resolution does not assure the money will be used for
that purpose. We all know the Senate budget resolution cannot compel
the Finance Committee to make any specific decision. Again, I would
just say to my colleagues, I don't know of a single Senator who is
opposed to extending the middle-class tax cuts.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I wish that was the case. But I would
like to say that there has been a lot of politics. Maybe this is more a
political year because of the election. We can't even get conferees for
the Workforce Reinforcement Act, a bill that passed unanimously in the
Senate. Yes, you might say everybody is in favor of it, but people
might find a reason not to give consent to pass it or they might say: I
will pass it, but I want to offer amendments. And maybe those
amendments would continue to be offered, more and more amendments.
Tax codes are interesting. The Senator from North Dakota and I both
serve on the Finance Committee with Senator Grassley. When you get a
tax bill on the floor, you could have an unlimited number of
amendments. There are 100 Senators and probably every one of us has
different ideas on the Tax Code. We might start debating ethanol
subsidies because the Senator from New Hampshire and others believe we
have overdone it on ethanol. Before you know it, we might not finish
this bill.
The chairman said he wants to make sure we can get it finished one
way or another, to make assurances to those families who have kids, or
those married couples, that they are going to continue to keep the same
taxes so they don't have a tax increase.
This is not about tax cuts. This is making sure they don't have a tax
increase. The only way we can make sure they don't have tax increases
is to defeat the Byrd amendment.
Mr. President, I yield back the remainder of our time on the
underlying amendment.
Mr. NICKLES. Mr. President, I believe the regular order would be to
recognize Senator Warner for his amendment.
The PRESIDING OFFICER (Mr. Smith). Under the previous order, the
Senator from Virginia is recognized to offer an amendment.
Mr. WARNER. I thank the Chair.
Mr. NICKLES. If the Senator will yield for a moment, I suggest the
absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. CONRAD. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CONRAD. Momentarily, we will be considering an amendment with
respect to the defense budget for the year. That is being worked out
now, and Senator Warner will be here momentarily. Perhaps he is almost
ready.
I wish to express the opinion that I do not think it is wise to cut
the Commander in Chief's defense request when we are at war. I don't
think that is the right policy. I don't think it sends the right
signal. I personally believe the increase ought to be paid for. But I
think we ought to increase the defense request to what the Commander in
Chief has recommended when we are at war.
With that, I see Senator Warner, so I will stop until he has made his
presentation, and then we will have a further opportunity to discuss
the pending amendment.
Mr. WARNER. Mr. President, I thank the distinguished Senator from
North Dakota. Momentarily, he is quite correct, we will address that.
This amendment raises the caps and we do not have an offset in it. We
believe at this point in time the urgency of the matter dictates that
we do just what I hope the Senate will do by virtue of adoption of this
amendment.
Momentarily, the Senator from Oklahoma will return to the floor and
perhaps the Senator will ask if we may proceed.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. CONRAD. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CONRAD. Mr. President, parliamentary inquiry: How is the time
being charged?
The PRESIDING OFFICER. Time is being charged against the resolution.
The quorum calls are being equally divided.
Mr. CONRAD. We are not charging time against the amendment then.

[[Page S2505]]

The PRESIDING OFFICER. That is correct.
Mr. CONRAD. I do not want to take action without consulting the other
side, and the chairman is not in the Chamber at the moment. So I will
not make a request at this point. Maybe if we can ask the floor staff
to check if we want to be charging time to the amendment on an equal
basis. I asked that question because we have tried to carefully
calibrate this so we would have a voting window starting at 6 o'clock.
Maybe if people can check, and while that is being done, I will add a
few thoughts on this question.
I agree with Senator Warner we ought to increase the defense
allocation to the request of the Commander in Chief when our troops are
engaged in combat. I think that should be done.
I also believe we ought to pay for it. As I understand it, under
Senator Warner's amendment, the increase will be made to increase the
budget allocation to the request by the President--I agree with that--
but it will not be paid for. With that I do not agree. When presented
with a choice, I will vote to increase the spending to the request by
the Commander in Chief because I do not think it is appropriate policy
not to fully fund the Commander in Chief's request when our troops are
engaged in combat half a world away. Our troops right now are engaged
in direct combat in Iraq and Afghanistan and, of course, in addition to
that, we are engaged globally in the war on terror. That does not mean
we should not pay for these additional expenditures. Already we see
record budget deficits.
We see in this budget resolution the debt of the country being
increased by $2.86 trillion over the next 5 years. That is a stunning
amount of money. The assertion by some that the deficit is being
reduced really pales in consideration and in comparison to what is
happening to the debt.
The increases in the debt under this budget are simply staggering--
$2.86 trillion over the next 5 years. That is before the baby boomers
retire, that is before the full cost of the President's tax cuts
explode because they increase geometrically right beyond the budget
window.
I would hope we would increase what is in the budget for our national
defense to the amount requested by the President, but we do it in a way
that is paid for. I think that would be the right approach.
Unfortunately, Senator Warner's amendment has half of that formula. He
will have the increase in funding but will not have the appropriate
offsets.
We will have a vote later on the question of paying for this
increase. I hope my colleagues are on notice on what this amendment
will involve, and hopefully we will be on this amendment soon.
I will withhold my request if the Senator from Missouri wants to take
some time. Can we go on to the amendment then? The Senator from
Missouri will speak with the understanding that the time will, at a
later moment, be taken off the time of the amendment so we can try and
stay on schedule.
I thank the Chair. I thank my colleague.
The PRESIDING OFFICER. The Senator from Missouri.
Mr. TALENT. Mr. President, I thank my friend from North Dakota for
accommodating me and allowing me to speak for a few minutes about the
amendment we all know is going to be offered in a few minutes by our
friend and colleague, Mr. Warner from Virginia.
I do thank and congratulate Chairman Warner and also Chairman
Stevens, not just for producing this amendment I think is so important,
but also for their work over the years in sustaining America and
keeping faith with the men and women who keep faith with us every day
and serve us on the front lines and on the back lines and throughout
the world to keep our country safe.
I want to suggest to the Senate there is no more serious amendment we
will consider in this debate on the budget than the one Senator Warner
is about to offer.
America is deeply engaged in the world in all respects, and it should
be, it needs to be. It is a difficult task, but it is one we bear every
day as a nation in a lot of different ways.
Yet despite all our other efforts, despite our diplomatic efforts,
despite our participation in international organizations, despite the
coalitions we have built around the world, despite our foreign aid,
despite our exhortations based on our philosophy, despite the power of
our ideas, as important as all of that is, America's security and the
security of our allies and our friends around the world depends and
continues to depend on the reality and the perception of our military
power.
That is what is at stake in this amendment today. The President of
the United States has submitted a defense budget which states a
requirement of $421 billion for the national defense. In my judgment,
that is quite probably too low. I have argued for 10 years, first in
the House and now in the Senate, that we are not adequately funding our
defense establishment.
I simply offer very briefly as evidence of that the fact the Joint
Chiefs of Staff recently submitted, in response to a question from
Congressman Ike Skelton, my old and dear friend from the other body,
about what their unfunded requirements were. In other words, what are
their requirements they were not able to get into the President's
budget.
They submitted $12 billion in unfunded requirements, and that is just
their top priorities: $6 billion for the Army; $2.5 billion, roughly,
for the Navy; $2.5 billion for the Air Force. I think it is more than
that, based on my years of experience. I believe we could add $15
billion to $20 billion to the budget for procurement alone without
overfunding America's military. I will explain in a minute why we are
in this position.
The Army needs to be bigger. I supported an amendment that was
offered by the Senator from Rhode Island, Mr. Reed, last year to
increase the size of the Army. I think it needs to be another 30,000 to
40,000 men and women. I am pleased to say the administration is moving
in that direction now, at least on a temporary basis, but that
requirement was not included in the President's budget. Half of
military housing is inadequate. That was not provided for in the
President's budget. There are other quality-of-life needs we would like
to meet.
Many of us here would like to resolve the issue of concurrent
receipt, for example, so we can allow our military retirees who also
have a military disability pension to keep both their retirement they
earned and the disability benefits they deserve. That is not included
in the budget. I could go on on behalf of my belief that the $421
billion the President has asked for is probably too low.

Now, I am sure it will be said by some in the debate on this
amendment that the President's budget increases defense from last year
by 7 percent and that is too great. That is above the rate of
inflation.
Our spending on defense as a percentage of gross domestic product is
less than it was prior to World War II. We spent 47 percent of our
discretionary funds on defense in 2002 compared to 60 percent in 1990,
and we are at war. It is time for us to get as serious as the men and
women in America's military are about winning this war.
I went into the Congress in 1993. It was just after the outgoing
first Bush administration had, in response to the cold war, cut the
size of America's military establishment by about a quarter to
establish what they called the Bush base force, which, by the way, is
probably about what we need today, in my judgment.
The incoming Clinton administration then cut the size of the force an
additional 25 percent, to about a third, depending on which branch of
the service we are talking about. I argued all throughout the 1990s
that we were not funding even that undersized force adequately.
All throughout those years, we were tacitly engaging in the
assumption in this Congress that there was not any real threat to the
United States; that with the end of the cold war in some sense history
had ended as well.
Well, history had not ended. It had not ended all those years. It was
just frozen and it thawed out with a vengeance on September 11. All the
ethnic and regional rivalries of the world--fanaticism, nationalism,
extremism--have risen up now to threaten us and once again we
rediscover we do, indeed, need America's military and we do, indeed,
need to fund it.

[[Page S2506]]

The question today is whether we are going to be serious on behalf of
that responsibility. The force is too old. The reason it is too old is
that all throughout the 1990s we were not buying enough new, what they
call in the military, platforms, trucks, and planes.
When the capital stock is not replenished, it gets old. The average
age of an aircraft in the U.S. Air Force is 22 years; the bombers, over
40 years; Navy and Marine aircraft, 18 years. We do not have enough
ships in the Navy. We have 294 ships in the Navy. The Chief of Naval
Operations, the Chief of Staff of the Navy, says we need 20 more today.
His vision for the future is 375 ships, and we are not buying enough to
get us there. We are not buying enough to maintain a 300-ship Navy.
I could go on. I have done it before, at least when I served in the
other body. Some evening I will probably have occasion to spend 45
minutes or an hour discussing this.
To his credit, and in the face of the threat presented by the
terrorist war, President Bush has regularly submitted substantial
increases in the defense budget to this Congress. To its credit, this
Congress has supported those increases. Along with the tremendous
dedication of America's military and the vision and leadership of those
who are running it, it is helping. We need to stay at least on that
course.
It would be almost a historical abdication of our responsibilities
were we not to provide for at least the amount of money the President
of the United States has asked for America's military while America's
military is fighting a war for us.
The only argument against it is that the deficit is a problem. Well,
yes, the deficit is a problem. We are in a war. Members who do not
believe that should read about it. It is in the papers every day. We
are in a war. We are also in a recession.
I have not gone back and checked the Almanacs but I cannot imagine a
time when the United States has been in a war and a recession and has
not run a deficit. If my colleagues are worried about the deficit, let
me suggest what will increase the deficit: If we lose the war, I
guarantee that will increase the deficit. We do not have to lose it; we
just have to suffer another significant attack on our homeland, and it
can happen. That will increase the deficit. In fact, all we have to do
is encourage America's enemies--and we have enemies around the world--
to believe that we will not see this through, that we will retreat. I
guarantee that will increase the deficit a lot more than the amendment
of the Senator from Virginia proposes to do.
Let's not be shortsighted. I have confidence that this Senate will
not be. I do not want to sound like a scold; I really do not. I am
proud of what the Congress has done the last few years in supporting
our military.
I serve on the Armed Services Committee. I am proud to be on that
committee. An hour ago I left a hearing, which I had the honor of
chairing, of the Seapower Subcommittee, where Senator Kennedy is the
ranking member. We had several hours in which we considered the
capacity of our military to move goods around the world. One of the
areas of jurisdiction of the subcommittee is on airlift and the
capacity of our marine resources, civilian and military, to move goods
around the world. I was astounded, amazed, and encouraged by how much
we have improved the efficiency of that part of the service. We are all
in debt to the men and women who work there and who run that, both
civilian and military. I am pleased this Congress has sustained their
efforts, and I know we will sustain the efforts of our men and women in
America's military today.
They are doing their job. The question is whether we are going to do
ours. They are watching. Our enemies are watching to see what the
Senate does today. I am not sure exactly the form in which the Warner
amendment will be offered. I do know it will restore the approximately
$7 billion that the committee reduced and cut from the President's
submission. We need to pass that amendment. We need to do our job in
winning this war and protecting the American people.
I yield the floor.
Mr. CONRAD. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. NICKLES. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. NICKLES. I believe, under the consent request that we had entered
into previously, we have had debate on the reconciliation amendment by
Senator Byrd. I believe next in order would be Senator Warner to offer
an amendment, and then Feingold on the pay-go amendment. It is our
intention to vote on all three of these back to back hopefully as close
to 6 as possible. We have had a little break, and I apologize for that,
but it would be our intention to try to have debate on both amendments
and vote as close to 6 as possible.
I now yield to my friend and colleague Senator Warner to manage our
time on this amendment.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. WARNER. Mr. President, it is my understanding that there is an
hour equally divided. Am I correct on that?
The PRESIDING OFFICER. The Senator is correct.
Mr. WARNER. Mr. President, I thank both managers of the bill for
their cooperation.
Mr. CONRAD. Will the Senator yield for just a moment?
Mr. WARNER. Yes.
Mr. CONRAD. One of the things we discussed, if I can say, is there
was a slight amount of time used here in discussion on the amendment.
One of the things that was discussed was the possibility, perhaps, of
charging that time to the amendment once we got on the amendment so we
could hold to the schedule of being as close to 6 o'clock as we could
be. Would that be agreeable?
Mr. WARNER. No objection.
Mr. NICKLES. Mr. President, how much time had both sides used?
The PRESIDING OFFICER. The Senator from Missouri used 11 minutes, and
the other side has not used any.
Mr. CONRAD. We did, actually. I spoke.
The PRESIDING OFFICER. Five minutes?
Mr. CONRAD. Yes.
Mr. NICKLES. Mr. President, I ask unanimous consent there be 40
minutes on the amendment to be equally divided.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 2742

Mr. WARNER. Mr. President, I send an amendment to the desk and ask
for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Virginia [Mr. Warner] for himself and Mr.
Stevens, Mr. McCain, Mr. Inhofe, Mr. Roberts, Ms. Collins,
Mr. Chambliss, Mr. Graham of South Carolina, and Mr. Talent,
proposes an amendment numbered 2742.

Mr. WARNER. I ask unanimous consent the reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To increase the amounts provided for national defense (050)
for fiscal year 2005 for new budget authority and for outlays)

On page 4, line 4 increase the amount by $6,997,000,000.
On page 4, line 5, increase the amount by $262,000,000.
On page 4, line 6, increase the amount by $358,000,000.
On page 4, line 7, increase the amount by $405,000,000.
On page 4, line 8, increase the amount by $432,000,000.
On page 4, line 12, increase the amount by $5,506,000,000.
On page 4, line 13, increase the amount by $1,855,000,000.
On page 4, line 14, increase the amount by $799,000,000.
On page 4, line 15, increase the amount by $550,000,000.
On page 4, line 16, increase the amount by $480,000,000.
On page 4, line 20, decrease the amount by $5,506,000,000.
On page 4, line 21, decrease the amount by $1,855,000,000.
On page 4, line 22, decrease the amount by $799,000,000.
On page 4, line 23, decrease the amount by $550,000,000.
On page 4, line 24, decrease the amount by $480,000,000.
On page 5, line 3, increase the amount by $5,506,000,000.

[[Page S2507]]

On page 5, line 4, increase the amount by $7,362,000,000.
On page 5, line 5, increase the amount by $8,161,000,000.
On page 5, line 6, increase the amount by $8,711,000,000.
On page 5, line 7, increase the amount by $9,191,000,000.
On page 5, line 11, increase the amount by $5,506,000,000.
On page 5, line 12, increase the amount by $7,362,000,000.
On page 5, line 13, increase the amount by $8,161,000,000.
On page 5, line 14, increase the amount by $8,711,000,000.
On page 5, line 15, increase the amount by $9,191,000,000.
On page 7, line 25, increase the amount by $6,900,000,000.
On page 8, line 1, increase the amount by $5,409,000,000.
On page 8, line 5, increase the amount by $1,594,000,000.
On page 8, line 9, increase the amount by $442,000,000.
On page 8, line 13, increase the amount by $145,000,000.
On page 8, line 17, increase the amount by $48,000,000.
On page 22, line 9, increase the amount by $97,000,000.
On page 22, line 10, increase the amount by $97,000,000.
On page 22, line 13, increase the amount by $262,000,000.
On page 22, line 14, increase the amount by $262,000,000.
On page 22, line 17, increase the amount by $358,000,000.
On page 22, line 18, increase the amount by $358,000,000.
On page 22, line 21, increase the amount by $405,000,000.
On page 22, line 22, increase the amount by $405,000,000.
On page 22, line 25, increase the amount by $432,000,000.
On page 23, line 1, increase the amount by $432,000,000.
On page 39, line 18, increase the amount by $6,900,000,000.
On page 39, line 19, increase the amount by $5,409,000,000.
On page 40, line 2, increase the amount by $1,594,000,000.

Mr. WARNER. Mr. President, in this amendment, I am joined by Senator
Stevens, Senator McCain, Senator Inhofe, Senator Roberts, Senator
Collins, Senator Chambliss, Senator Graham, Senator Craig, and Senator
Talent.
The amendment is very simple. It restores funding for the Department
of Defense to the level requested by the President for fiscal year
2005. Specifically, this amendment will add $6.9 billion to the level
contained in the pending budget resolution for the national defense 050
budget function.
As we review our budget priorities for the coming year, it is clear
many important programs must compete for limited resources. Hard
choices must be made. As we individually wrestle with the hard choices
we must make, I remind my colleagues we have no more solemn
responsibility than that imposed by the Constitution of the United
States and that is to provide for the common defense of this great
Nation, the United States. This is the most important function of the
Federal Government.
The President requested $420.7 billion for defense-related activities
for fiscal year 2005. That request includes funding for the Department
of Defense, the defense activities of the Department of Energy--that's
roughly two-thirds of the total Department of Energy budget--and a
significant amount for the intelligence community.
Our military service chiefs--the Chief of Naval Operations, Chief of
Staff of the Army, the Commandant of the Marine Corps, Chief of Staff
of the Air Force--all four service chiefs came before the committee and
asked that we authorize and obtain the full amount requested by the
President.
As you well know, having spent a considerable portion of my career in
the Department of Defense, each year the President goes to the
Department for their recommendations, a budget is made up and it is
submitted and it finally is submitted to the Office of Management and
Budget on behalf of the President and Congress.
Recognition must be given that we are a nation at war. Those are the
very words used by our distinguished colleague, the manager of this
bill, moments ago. Terrorists brought this war to our shores on
September 11, 2001. President Bush, together with a coalition of
nations, responded forcefully and effectively. This Chamber provided a
resolution expressing support for the President to bring the war on
terrorism to the terrorists.
Hundreds of thousands of our servicemen and women are now deployed
around the world defending our Nation in Operation Enduring Freedom,
Operation Iraqi Freedom, and other military operations in the ongoing
war on terrorism. Hundreds of thousands more are forward deployed in
Korea, the Balkans, at sea and elsewhere, protecting American interests
and deterring aggression.
I wonder if our Nation realizes that well over half of the United
States Army today, some 320,000 men and women, proud to wear the
uniform of the United States Army, are deployed overseas, over half of
the total standing Army--leaving their families behind, going into
harm's way to protect us. Others stand vigilant at our borders and at
our ports and in our skies here at home. We have an obligation, in my
judgment, to live up to the President's budget request, which budget
request was carefully prepared in consultation with the Chiefs and
other senior members of the defense force.
What have our Armed Forces accomplished in the last few years? The
simple answer is, everything we have asked of them and more. They have
confronted brutal regimes in Afghanistan, and Iraq and given the people
of those regions hope, and an opportunity to experience freedom and
democracy. In Iraq, together with a coalition of nations, they
liberated a repressed nation--a country larger than Germany and Italy
combined--in roughly 3 weeks. The Armed Forces accomplished this with
unprecedented precision, and with casualties far below estimates. This
level of professionalism is what we have come to expect of our
military.
Such expectations must be tempered by the realization that the
magnificent professionalism of our Armed Forces is a product of strong
leadership, patriotic young men and women, supportive families, great
American technology, and strong, consistent resources. All of these
things require the long term support of the Congress in the form of
funding, guidance and support.
At a time of unprecedented demands on our military, it is critical
that we provide our men and women in uniform--active, reserve, and
National Guard--the funding they need to continue to successfully
accomplish their missions. To meet the challenges we now face around
the world, and to prepare for the future, the President has proposed a
budget that includes $420.7 billion for national defense. It is a
prudent request that maintains the readiness of our current force and
makes the investments necessary to develop and field the capabilities
that will keep our Nation safe from the uncertain threats of the
future.
We are blessed with a military that has responded to the demands of a
post-September 11 world with extraordinary commitment, but even the
best military has its limits. The pace of recent operations is putting
increased demands on our forces around the world, increased demands on
our Reserve and National Guard units, and increased demands on military
families. Our military has dedicated personnel--active duty, reserve,
guard and retirees--and families who must be fairly compensated with
competitive pay and a good quality of life. Our military has equipment
that has been heavily used in recent operations that must be repaired
or replaced, and new capabilities that must be developed and procured
to meet future threats. And finally, our military has an aging
infrastructure that must be modernized.
In my opinion, the President's budget request for defense has struck
the proper balance to accomplish these goals. At this critical time in
the war against terror, when we are asking so much of our uniformed
personnel and their families, and when we are seeking the continued
cooperation of our allies, what message do we want to send? We must
send a message of continued commitment and resolve by supporting the
level of funding for defense requested by the President. Our military
deserves no less.
At this time, Mr. President, I yield the floor and grant such time as
the distinguished Senator from Alaska may desire
The PRESIDING OFFICER. The Senator from Alaska.
Mr. STEVENS. Mr. President, in a time of war, and we are at war--we
are at war against terrorism; that's the leading war we are still
involved in; we

[[Page S2508]]

have activities in Haiti; we have them in Afghanistan and they are
persisting in Iraq--it is my feeling the request of the Commander in
Chief should be met in full, and that's what this amendment does. It
meets in full the request of the President, submitted in his budget for
the activities of the Department of Defense not directly connected with
Iraq and Afghanistan. We are going to see that in a supplemental, I
assume, sometime after the first of the year.
But as a practical matter, this budget is a very thin budget for a
military stretched as thin as it is right now around the world. As the
Senator from Virginia says, more than half of our men and women in
uniform are outside the United States at this time. It is a matter of
just simple justice, as far as I am concerned. The Commander in Chief's
request should be honored. I hope the Senate will support this request.
The PRESIDING OFFICER. The Senator from Arizona.
Mr. McCAIN. Mr. President, I support the amendment by the Senator
from Virginia, the distinguished chairman of the Armed Services
Committee. He has been a member of the committee for many years. He
understands our defense and national security needs.
I believe the fundamental message is we are in a war. We are in a
war. We are in a war. The fact is this money is needed in order to
prosecute the conflicts in Afghanistan, in Iraq, and around the world,
as we fight the war on terrorism and attempt to thwart the possibility
of a terrorist attack on the United States of America and our citizens.
Clearly, we are going through a period of transition in the military,
and one that is going to be somewhat expensive, but there is no doubt
we have to adjust our military in order to meet the needs of an ever-
changing and, in some respects, larger threat to our security than we
have faced in the past few years.
Also, I have the greatest respect for our colleagues here in the
Senate and the distinguished chairman of the Budget Committee and the
ranking member. But I did note, with some interest, that the chairman
of the Budget Committee in the House suggested a moratorium on earmarks
for 1 year. Why would he do that?
Well, I show my colleagues a very interesting Congressional Research
Service chart which shows that in 1994, there were 4,126 earmarks; in
1996, it went down to 3,023 earmarks; and it has gone steadily up
geometrically; and in 2004, there were 14,040 earmarks--amounting to a
grand total of $47.9 billion--$47.9 billion.
Rather than cut $7 billion out of defense, why don't we cut $7
billion out of $47.9 billion of pork-barrel projects, such as the $3
million to study the DNA of bears in Montana, the Cowgirls and Cowboys
Hall of Fame, and the elves up in North Pole, AK, that got some more
money this time?
Why don't we cut $7 billion out of $47.9 billion in earmarked funds?
That comes from the Congressional Research Service, up from $23.7
billion in 1996. Why don't we show some courage, make some choices, and
cut this, rather than cutting $7 billion out of defense?
I would hope my colleagues on the Budget Committee at some point
would seriously consider a moratorium on earmarks--just for 1 year. It
might be a nice thing to see.
Mr. President, I support the amendment from the Senator from Virginia
and I hope the choices we make are not to cut into our Nation's
security but to cut into the pork-barrel spending which has absolutely
run amok in this body. It is a disgrace, and there is no excuse for it.
I hope we will start attacking the wasteful and pork-barrel spending
rather than the men and women in the military.
I support the amendment.
Mr. President, I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I compliment my colleagues, Senators
Stevens and Warner. I intend to support this request.
Senator Stevens, when I first brought to his attention that we needed
to stay with the cap of 814, brought to my attention very strongly,
repeatedly, that he wanted to have the President's full request in.
This amendment does that.
The reason we brought a resolution out at 814 was to make sure a
budget point of order wouldn't lie against the entire resolution and
frankly kill the resolution. We would have to have 60 votes. The
amendment Senator Stevens and Senator Warner are introducing fully
funds the President's request and frankly it increases the caps to do
so. It takes 60 votes to pass the amendment. It increases the deficit
by $7 billion. It means we are going to have increases in defense
spending by $27 billion, 7.1 percent. It is a big increase, but frankly
we have big challenges with our defense.
I happen to agree with Senators Warner and Stevens, when we have
troops in the field who have their lives in jeopardy day by day, being
fired upon, we need to give them support as requested by their
Commander in Chief.
I hope our colleagues will support this amendment.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, can the Chair advise me what the time
situation is on both sides?
The PRESIDING OFFICER. There are 12 minutes 50 seconds remaining on
the Republican side, 20 minutes on the Democratic side.
Mr. CONRAD. Mr. President, speaking for our side, I again want to
indicate I intend to fully support the amendment of the Senator from
Virginia, joined in by the Senator from Alaska. Is this a Stevens-
Warner amendment at this point?
I just think we need to send a very clear message. When we are at
war, when our troops are in jeopardy, when they are in combat zones,
when the Commander in Chief makes a request, we need to honor that
request.
Look, I believe we ought to pay for this increase. I believe we ought
to offset it with either additional revenues or spending cuts in other
areas because the deficit is at record levels now and this just
increases it. We are seeing dramatic increases in the debt.
We had a right to offer second-degree amendments to this amendment to
provide a pay-for. We basically did not exercise that right, in an
agreement to get a number of amendments up and voted on before 7
o'clock tonight. But it is our intention, with a later amendment, to
offer a means of paying for this increase.
Without that before us at the moment, the choice becomes do we
increase the defense expenditure to meet the request of the Commander
in Chief or do we not?
I believe the imperative is clear. I believe we must raise the
defense expenditure level to meet the request of the Commander in Chief
when we have troops in combat half a world away fighting day and night
for this country.
It is my intention to ask our colleagues to support the Warner-
Stevens amendment. At a later time, it will then be my intention to ask
our colleagues on both sides to find a way to pay for it and to suggest
specific ways we might do that. I hope colleagues will keep an open
mind on that subsequent amendment.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I very much appreciate the support of
Senator Conrad on this amendment. We have worked together now on two or
three amendments. We have agreed to some amendments. That is good
progress.
I also want to correct the Record. I said it was my understanding
that this increases the defense amount by 7.1 percent. That is the OMB
figure. The Congressional Budget Office figure is 6.8 percent. I was
accurate by saying it would increase defense spending by $27 billion.
I yield the floor.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. WARNER. Mr. President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
Mrs. BOXER. Mr. President, this budget resolution is $6.9 billion
below the President's request for defense spending for fiscal year
2005. I am voting for the Warner amendment to restore this cut.
I am doing so because I believe we should pay for our activities in
Iraq

[[Page S2509]]

and Afghanistan within the budget. I do not believe we should pretend
those costs do not exist and then have the President come back to
Congress saying we did not give him enough money and he needs more.
We must have truth in budgeting. The costs of our operations in Iraq
and Afghanistan should be included in the budget; the costs should be
paid for with regularly budgeted funds. The alternative is further
escalating debt.
I am extremely concerned about the runaway debt. If we do not include
in the budget the costs of our operations in Iraq and Afghanistan, the
President will come back with a request for emergency supplemental
funds. Those funds do not have to be offset, thereby adding billions of
dollars to our national debt.
Therefore, I will vote for the Warner amendment to restore the cut in
defense spending.
Mr. WARNER. Mr. President, I presume the managers desire to have this
amendment laid aside for the present time, unless there are other
speakers.
I yield such time as the Senator from Oklahoma desires.
Mr. President, would you advise the Senator from Virginia the amount
of time we have left?
The PRESIDING OFFICER. Eleven minutes forty seconds.
Mr. WARNER. Mr. President, the Senator from South Carolina desires a
couple of minutes following the Senator from Oklahoma.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. INHOFE. Mr. President, I will be very brief. I think everything I
would have said has been said by our chairman, Senator Warner.
We have 325,000 troops scattered around 120 different countries. I
chaired the Subcommittee on Readiness for a number of years. That was
during the 1990s when we were making cuts in our defense across the
board in terms of end strength, in terms of numbers of divisions and
numbers of tactical air wings, in terms of the numbers of ships, in
terms of modernization, and in terms of readiness. It was very
disturbing during that time. I was outspoken at that time that we might
be going too far.
Recently we went through this thing of not having adequate body
armor. Of course, the Army, in this case, responded with our help and
we are able to say now they are taken care of adequately.
In modernization, we are going into the future combat system. We were
delayed in the 1990s. Now things are getting back on track. However, we
often say we want our troops, our men and women in uniform, to have the
very best of equipment and the best support.
Quite frankly, we don't have as good equipment as some of our
potential adversaries in the case of our artillery. We are still
dealing with World War II technologies when there are five countries
that have made a better case than we have. I don't think the American
people want our young people going into combat with anything except the
best. That is what this is about. We are in a rebuilding mode right
now. We are talking about transforming all branches. We are talking
about changing the way our troops are stationed around the world. This
is going to be expensive. We are in the middle of a war. I strongly
support the increases recommended by the chairman, Senator Warner.
I yield the floor.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM of South Carolina. Mr. President, I rise in support of the
amendment offered by our chairman. I thank the chairman, Senator
Warner, for doing something that is not easy. We pride ourselves on
trying to be fiscal conservatives and taking care of the country's
needs and the President's budget request for the military. I applaud
our chairman, Senator Warner, for offering this amendment to make sure
we can get the money the President thinks we need to defend the Nation.
One thing I have learned about this whole process is I would not want
Senator Nickles' job. It is very hard to put a budget together which
does what we need to do for the economy and for defense of the Nation
and other domestic priorities.
But I know where this debate is going. It won't be long before we
will have an amendment to counter this amendment saying, all right, we
will agree that the military needs more money. I am glad we agree with
that, because they do. But then they will start arguing, let us pay for
it; let us be fiscally responsible, and let us take money from this
group to pay for it. We are going to get into a partisan fight in the
name of fiscal responsibility that probably doesn't have a whole lot to
do with fiscal responsibility. I think that is sad but we know it is
coming.
Let me say this: The No. 1 job of being a Senator, in my opinion, is
to make sure we can defend America. We can have all the fights about
how you create jobs, and I would argue to my friend--I will be glad to
speak on this proposal--if you are worried about losing jobs in
America, then you need to be more friendly to people who are trying to
create jobs in America. You are not a very friendly crowd to job
creation with your proposals. But we will talk about that down the
road. I know it is coming.
Let me say this: It is good news for the men and women in uniform at
this point in time because we have bipartisan support to make sure
there is budget authority to defend America. I thank the chairman on
their behalf. I look forward to the debate to come about this issue in
terms of domestic politics. But I hope we don't get unnecessarily off
script for the men and women who depend on us making sure they have the
equipment when we ask them to fight the war. They probably don't
appreciate a lot of the fussing and fighting.
Mr. WARNER. Mr. President, I thank my distinguished colleague.
Mr. President, how much time remains under the control of the Senator
from Virginia?
The PRESIDING OFFICER. The Senator has 7 minutes remaining.
Mr. WARNER. Mr. President, we will yield our time if the other side
will yield their time and go on to the next matter.
Mr. CONRAD. Mr. President, we are prepared to yield back time on this
side. I yield all but 5 minutes of our time reserved for Senator Levin.
We can proceed with Senator Feingold.
Mr. NICKLES. Mr. President, I thank our colleague, Senator Warner,
chairman of the Armed Services Committee, and also Chairman Stevens of
the Appropriations Committee for their cooperation on this amendment. I
am sure the Commander in Chief is grateful for this amendment. I am
sure the Chiefs of Staff of the Armed Forces are grateful for this
amendment.
For the information of our colleagues, this amendment, in addition to
Senator Byrd's amendment and I believe Senator Feingold's amendment,
will be voted on probably a little before 6 o'clock. Also, for the
information of our colleagues, I know there are other amendments out
there. Senator Conrad and I already realize we are running short on
time and the number of days. We are going to finish this bill by
Friday. I encourage our colleagues to either not offer amendments or at
least work with us so we can accept or dispose of some amendments in
one way or another. But if they have amendments, please bring those to
our attention tonight. It is our intention to work very late tonight. I
hate to do that because our very good friend, Chairman Stevens, is
having a nice event that I would love to attend, but I think our
business is to complete the budget this week.
For the information of our colleagues, we expect three rollcall votes
shortly before 6 o'clock. I believe the regular order of business now
would be for Senator Feingold to offer his amendment.
Mr. CONRAD. Mr. President, we have just now tallied all the
amendments that have been noticed. I know the chairman will be
interested to know there are 98 amendments pending. Let me say those
are amendments that have been noticed to us. They are not necessarily
pending before the Senate, but Senators have given notice they intend
to offer 98 amendments. It takes 1 hour to handle three amendments.
That would be 33 hours of straight voting. We have to get serious. We
cannot have a circumstance in which we spend 33 straight hours voting
on amendments to the budget resolution. That is an unreasonable
proposition. It is an

[[Page S2510]]

unreasonable proposition for the Members, and an unreasonable
proposition for the administrative staff.

I am sending the message to our colleagues, let's eliminate the
duplication. Let's ask Senators to refrain from offering amendments
that can be offered later to appropriations bills or to other
legislative vehicles. We cannot have 98 amendments voted on this budget
resolution. There is no way we would finish by Friday. We have agreed
on a common goal of finishing the budget resolution by Friday. We have
worked in good faith together. Please, colleagues, let's show some
restraint.
We will turn it over to our Senator from Wisconsin, Mr. Feingold.
The PRESIDING OFFICER. The Senator from Wisconsin.

Amendment No. 2748

Mr. FEINGOLD. Mr. President, I thank the managers for making it
possible for me to offer this amendment at this time. I send an
amendment to the desk and ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Wisconsin [Mr. Feingold], for himself, Mr.
Chafee, Mr. Baucus, Ms. Cantwell, Mr. Carper, and Mr. Graham
of Florida, proposes an amendment numbered 2748.

Mr. FEINGOLD. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To fully reinstate the pay-as-you-go requirement)

On page 46, between lines 2 and 3, insert the following:

SEC. 408. PAY-AS-YOU-GO POINT OF ORDER IN THE SENATE.

(a) Point of Order.--
(1) In general.--It shall not be in order in the Senate to
consider any direct spending or revenue legislation that
would increase the on-budget deficit or cause an on-budget
deficit for any one of the three applicable time periods as
measured in paragraphs (5) and (6).
(2) Applicable time periods.--For purposes of this
subsection, the term ``applicable time period'' means any 1
of the 3 following periods:
(A) The first year covered by the most recently adopted
concurrent resolution on the budget.
(B) The period of the first 5 fiscal years covered by the
most recently adopted concurrent resolution on the budget.
(C) The period of the 5 fiscal years following the first 5
fiscal years covered in the most recently adopted concurrent
resolution on the budget.
(3) Direct-spending legislation.--For purposes of this
subsection and except as provided in paragraph (4), the term
``direct-spending legislation'' means any bill, joint
resolution, amendment, motion, or conference report that
affects direct spending as that term is defined by, and
interpreted for purposes of, the Balanced Budget and
Emergency Deficit Control Act of 1985.
(4) Exclusion.--For purposes of this subsection, the terms
``direct-spending legislation'' and ``revenue legislation''
do not include--
(A) any concurrent resolution on the budget; or
(B) any provision of legislation that affects the full
funding of, and continuation of, the deposit insurance
guarantee commitment in effect on the date of enactment of
the Budget Enforcement Act of 1990.
(5) Baseline.--Estimates prepared pursuant to this section
shall--
(A) use the baseline surplus or deficit used for the most
recently adopted concurrent resolution on the budget; and
(B) be calculated under the requirements of subsections (b)
through (d) of section 257 of the Balanced Budget and
Emergency Deficit Control Act of 1985 for fiscal years beyond
those covered by that concurrent resolution on the budget.
(6) Prior surplus.--If direct spending or revenue
legislation increases the on-budget deficit or causes an on-
budget deficit when taken individually, it must also increase
the on-budget deficit or cause an on-budget deficit when
taken together with all direct spending and revenue
legislation enacted since the beginning of the calendar year
not accounted for in the baseline under paragraph (5)(A),
except that direct spending or revenue effects resulting in
net deficit reduction enacted pursuant to reconciliation
instructions since the beginning of that same calendar year
shall not be available.
(b) Waiver.--This section may be waived or suspended in the
Senate only by the affirmative vote of three-fifths of the
Members, duly chosen and sworn.
(c) Appeals.--Appeals in the Senate from the decisions of
the Chair relating to any provision of this section shall be
limited to 1 hour, to be equally divided between, and
controlled by, the appellant and the manager of the bill or
joint resolution, as the case may be. An affirmative vote of
three-fifths of the Members of the Senate, duly chosen and
sworn, shall be required to sustain an appeal of the ruling
of the Chair on a point of order raised under this section.
(d) Determination of Budget Levels.--For purposes of this
section, the levels of new budget authority, outlays, and
revenues for a fiscal year shall be determined on the basis
of estimates made by the Committee on the Budget of the
Senate.
(e) Sunset.--This section shall expire on September 30,
2009.

Mr. FEINGOLD. Mr. President, I am very pleased to offer this
amendment with Senators Chafee, Baucus, Cantwell, Carper, and Graham.
This amendment is very straightforward. It would simply reinstate the
pay-as-you-go rule that has been such an effective restraint on the
fiscal appetites of Congress and the White House.
The last 3 years have seen a dramatic deterioration in the
Government's ability to perform one of its most fundamental jobs, and
that is balancing the Nation's fiscal boxes. We are all familiar with
the history. In January of 2001, the Congressional Budget Office
actually projected in the 10 years thereafter, Government would run a
unified budget surplus of more than $5 trillion. A little more than 3
years later, we are now, unfortunately, staring at almost a mirror
image of that 10-year, $5 trillion surplus. Instead of healthy
surpluses, under any reasonable set of assumptions, we are now facing
immense deficits.
We must stop running deficits because they cause the Government to
use the surpluses of the Social Security trust fund for other
Government purposes rather than to pay down the debt and help our
Nation prepare for the coming retirement of the baby boom generation.
We have to stop running deficits because every dollar we add to the
Federal debt is another dollar we are forcing our children to pay back
in higher taxes or fewer Government benefits.
When the Government in this generation chooses to spend on current
consumption and to accumulate debt for our children's generation to
pay, it does nothing less than rob our children of their own choices.
We make our choices to spend on our wants, but we saddle them with
debts they must pay from their tax dollars and their hard work. That is
not right.
This is also why I am offering this amendment to fully reinstate the
pay-as-you-go rule. We need a strong budget process. We need to exert
fiscal discipline. This amendment would simply return us to the rules
by which Congress played for the decade of the 1990s. It would
eliminate the exceptions to pay-as-you-go included in last year's
resolution that exempt new tax cuts and new mandatory spending included
in a budget resolution. The reason we have to get rid of these
exceptions is these exceptions facilitate more damage to the Federal
bottom line.
I recognize there are some who prefer to provide some exemptions for
certain tax and spending policies. In particular, the argument has been
made that we ought to exempt the extension of the 10-percent bracket,
the child care tax credit, and the marriage penalty provisions. The
argument is that these, and possibly other policies, are so worthy that
they should not be subjected to pay as you go.
Let me offer what I think are two valid responses to this. First,
while there are certainly worthy tax provisions included in the
assumptions underlying this resolution, including those I just listed,
as the chairman of the committee has pointed out very effectively in
the Senate, no budget resolution can actually specify which taxes must
be cut and which must be raised. The resolution can set forth levels of
tax cuts, but it cannot specify which taxes are cut. It follows that
the resolution cannot specify which tax cuts should be exempt from
budget enforcement. It can exempt some level of tax cuts from that
enforcement, as indeed this resolution does.

But a budget resolution cannot specify which specific tax cuts are to
be exempt from budget enforcement. So we have no guarantee at all that
these popular and worthy tax cuts I just mentioned, those three, would
end up being the ones that would benefit from this exemption that
exempts tax cuts from the normal pay-as-you-go requirement on which we
have to get the 60 votes to waive the rule.
The second reason, for the specific tax cuts I mentioned earlier--the
10-

[[Page S2511]]

percent bracket, the child tax credit, and the marriage penalty
provision--I am absolutely sure there will be far more than 60 votes to
waive any point of order against those provisions. I even wonder if
anyone will propose to put us in a position where we have to waive a
point of order. Someone will have to actually raise a point of order.
These three sorts of tax cuts have such strong support that it is not,
in my view, a serious or genuine objection that the pay-as-you-go rule
will prevent them from being extended and continuing.
Reinstating the pay-as-you-go rule makes it harder for this body to
make the deficit worse. It does not prohibit these tax cuts. It does
not make it impossible to have a tax cut. It just makes it a little
harder. That is as it should be. Given our current budget position, we
ought to make it harder to make the deficit worse. If new tax cuts or
new mandatory spending is not to be offset, then they ought to be only
the most worthy of policies, not just anything that can get a majority
vote. They ought to be policies that can achieve the 60 votes needed to
waive a point of order.
It is very simple. That is what this amendment would do. It is the
least we should do to ensure fiscal responsibility and sound budgeting.
We must stop using Social Security surpluses to fund other Government
programs. We must stop piling up debt for our children to pay off. We
must continue the discipline of the budget process.
This is one of those situations where after you have been here a
while, you can actually speak from experience. I can speak from
experience of having watched in this body. As I came in 1993, we had
the largest deficit in American history. Were it not for these budget
rules, if it were not for the pay-as-you-go rules, I am certain the
parties would not have come together as we did over those years to
achieve what almost no one thought was possible--a very solid surplus.
Without these rules, the discipline goes away. Without these rules, we
are back to the behavior of the 1980s, which my constituents so
thoroughly condemn: Unlimited tax cuts on unlimited spending, the blank
checks that were written that put this Nation in its worst deficit to
date.
We now have a much worse deficit. We now have the largest deficit in
American history. It is incumbent upon this body to go back to what we
know worked, to what we know put the parties in a healthy competition,
to see which party could be more fiscally responsible. We desperately
need to return to that discipline now.
That is why I urge my colleagues to accept this amendment that will
return the pay-as-you-go rules in full.
I yield the floor.
The PRESIDING OFFICER (Mr. Cornyn). The Senator from North Dakota.
Mr. CONRAD. Mr. President, look, now we are starting to talk about
amendments that are just critically important if we are going to start
to do something about the skyrocketing deficits and the accumulation of
debt.
The pay-go provisions are budget disciplines to make it harder to add
to deficits. We have used these provisions in the past successfully to
move from record deficits to record surpluses.
In just a few moments, this body is going to vote on whether it is
going to renew those disciplines or we are just going to abandon the
ship and keep right on running up an ocean of red ink.
This year, we are poised to run a deficit in record terms of over
$470 billion--$100 billion more than last year. And last year's deficit
was almost $100 billion more than the previous record.
This is an opportunity for Senators to stand and be counted and be
held accountable. Are we going to go back to the budget disciplines
that have worked in the past or are we going to let them lapse? They
lapsed in 2002, they have not been reinstituted, and the deficit has
skyrocketed.
What this amendment does is to put back in place the fundamental
disciplines that say simply this: If you want new mandatory spending,
if you want new tax cuts, you can have them, but you have to pay for
them. It is that simple.
Some will say, Well, this does not discipline discretionary spending,
which is a third of Federal spending. That is true. We discipline
discretionary spending by spending caps. We have a spending cap in
place.
The question before us is, Are we going to reenact the budget
disciplines on mandatory spending, which is two-thirds of Federal
spending? Are we going to replace the budget disciplines on the revenue
side of the equation, which have been allowed to lapse?
Let me just put up a statement by the chairman of the Federal Reserve
on this question. Federal Reserve Chairman Greenspan, on restoring pay-
go, said:

I would, first, Mr. Chairman, restore pay-go and
discretionary caps. Without a process for evaluating various
trade-offs, I see no way that any group such as a Congress
can come to a set of priorities which will be effectively
reflecting the will of the American people.

Mr. President, this is the test: this vote. This is going to answer
who stands for budget discipline, who stands for getting these deficits
and debt under control, and who is going to sit on the sidelines and
allow these deficits and debt to continue to skyrocket out of control.
For those who say they are fiscally responsible, here is the test.
Here is the test. All the talk is going to be measured in this vote. Do
you stand for restoring the budget disciplines that have worked in the
past or do you not? That is the question.
I urge my colleagues to support this amendment.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. FEINGOLD. Mr. President, does the Senator from North Dakota want
more time off the amendment?
The PRESIDING OFFICER. Who yields time?
The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I thank my colleague from Wisconsin for
his amendment. He offered the same amendment in the Budget Committee. I
have great respect for him as a friend and a colleague, but I would
urge our colleagues to vote no on the amendment.
We have pay-go in the existing bill. We have pay-go basically for
anything that is not in the assumption of the budget resolution. We
assume $144 billion on the tax side. It may sound like a lot of money,
but over that 5-year period of time, we are talking about $12 trillion
of revenue. The amount of money that we are saving is a very small
percentage.
Now, why do we try to say, Well, you should not have to pay for that?
Because almost all of that, with the exception of a little AMT, is
present law.
We don't have pay-go if you have a lot of spending bills that sunset.
When those are reauthorized, you do not say, Oh, now you have to have
pay-go. You have to raise taxes or cut spending to reauthorize the farm
bill, for example.
As a matter of fact, I have found about $1 trillion worth of
entitlements over the next several years that are sunset or due to
sunset, but they don't have pay-go when they are extended. We have a
lot of tax cuts that are sunset that, when they are extended, would
have to be paid for. So it really discriminates against taxes, makes it
much more difficult to keep tax levels where they are today.
Some people say: Additional tax cuts. I say, no, keep taxes where
they are today. This is a much higher hurdle if you want to keep tax
levels where they are today. Adoption of this amendment is going to
make it a lot harder. It is going to make it a lot harder to continue
to have the marriage penalty relief we are now assuming in our budget.
That is $900 for my in-laws, $900 for my kids, $900 for any couple in
America that makes $58,000. We are assuming we are going to continue
present law.
People say: We want pay-go. We want it to apply to spending and to
entitlements. But when you look at the amendment, it doesn't apply to
appropriated accounts. It doesn't apply to increases in appropriations
for a lot of different activities.
Someone might say: That is handled in the caps. Only if you pass a
budget. The idea is to pass pay-go that is going to extend for the next
several years, I believe through 2009, regardless of whether you have a
budget. We may or may not have a budget. A lot of people predicted last
year we wouldn't have a budget. They predicted this year we wouldn't
have a budget. We proved them wrong last year, and I hope and expect we
will prove them wrong this year.

[[Page S2512]]

Spending is not covered. Discretionary appropriations are not
covered. What is appropriated is not covered. Next year 820-some
billion will not be covered. You could have any kind of increase. As a
matter of fact, it almost is an incentive for increases in
appropriations because that doesn't have to be paid for. But anything
else has to be paid for.
The tax cuts that expire or that have an expiration date--and we have
had to do that in the past for a variety of reasons--would have to be
paid for. Spending programs don't have to be paid for.
I didn't hear our colleague saying we needed pay-go when we were
doing concurrent receipts for retired military personnel. That was
about $40 billion. I didn't hear people say, when we were doing the
Medicare expansion, we need pay-go for that. That was $395 billion, as
scored by CBO, and that is permanent. So the Medicare bill, which is
going to grow dramatically over the next several years, can continue
growing almost unchecked unless a future Congress curtails it in some
way. And no pay-go, even if it is $300 billion the first 10 and maybe
$1 trillion the next 10 or more, no pay-go for that.
So spending can increase rather dramatically. But if you want to
continue having a 25-percent tax rate--and by the year 2010 it
expires--if you don't pay for it, that rate goes to 28 percent in the
year 2011. The difference between 28 and 25 doesn't sound like much.
That is 3 percent. That is over 10 percent. That is about a 15-percent
increase in an individual's tax rate. That means the marriage penalty
relief we just gave would disappear. That is $1,000. By that time, it
will be $1,000. Right now it is $911. We are trying to continue that.
Some people say: You want more tax cuts. That is not more tax cuts.
That is keeping present law. If we don't keep present law, extend
present law, it is going to be a tax increase on families.
What did we assume under our resolution? We assumed present law is
extended. Above that, you have pay-go. That is what our resolution
says.
I urge our colleagues, think about this a little bit. Frankly, if you
are going to have it, it really should apply to any entitlement program
that is sunset. That is not in this amendment. What we did in our bill
is very similar to my colleague's amendment with the exception of we
say we should exempt those things that are covered in the budget.
Primarily that includes extending present law on the child credit, on
the 10-percent bracket, and on marriage penalty relief. We also
included $23 billion for AMT relief, and we included $15 billion on the
energy bill. That is the bulk of what we have extended or what we
assumed. Anything above that has to be paid for, entitlementwise or
taxwise.
Again, I congratulate my colleague from Wisconsin, but I urge our
colleagues, if they want to protect families and make sure the tax cuts
happen, to vote no on the amendment.
I reserve the remainder of my time.
The PRESIDING OFFICER. The Senator from Wisconsin.
Mr. FEINGOLD. Mr. President, I appreciate not only the comments of
the Senator from Oklahoma but his leadership on the Budget Committee. I
enjoy very much serving with him on the committee. I also appreciate
the sort of change of tone from the opposition on this amendment.
Everything we have heard about this amendment recently is how we need
to have a weaker rule than the pay-go rule. Somehow we have to justify
these exceptions that were put in the Budget Committee resolution.
Finally the chairman is talking about what we really should be talking
about, that we need a strong rule.
What he has done is lay out some things our pay-go doesn't do. That
is true. There may be some additional things we should do in this area.
But what I am proposing, with the cosponsors, is let's at least go back
to the rules we know worked, the rules that brought this country a
balanced budget in the 1990s. They were proven to work. That is all
this amendment does.
If the Senator from Oklahoma wants to talk about additional steps, I
am all for it. Senator Gregg and I, in the Budget Committee in the
past, tried for 5-year caps on spending. We were defeated by a largely
party-line vote except for Senator Gregg. That didn't work so we tried
a 2-year cap, working with Senator Conrad. That was rejected. We tried
1 year. That is one of the three legs of the stool, the discretionary
spending. If the Senator wants to work with me and Senator Gregg and
others to propose legislation to deal with that, I am ready to go. In
fact, Senator Gregg and I proposed such a bill.
But the chairman knows very well we can't change that on the budget
resolution. We have to pass a statutory item in order to accomplish
that. So I am eager to do it.
Let's pass this pay-go amendment and let's immediately move on to
finish the job by passing the kind of statute that will achieve what
the Senator from Oklahoma is talking about.
I can't allow a complete changing of the subject because the truth is
the pay-go rules in the proposal before us are not pay-go. They are
pay-go minus. It is sort of as though you draft up a budget and after
you figure out what you want, then you draft up the rules by which you
will draft up the budget. That is the game we are playing here. We
don't go into the process saying: Look, we have played by these rules.
They have worked. We say: What do we need; what tax cuts do we want;
what mandatory spending do we want. And after that, everything else
that hasn't gone through the barn door, then we make the rules apply
after that.
I suggest that doesn't work. I suggest it is a formula for more
fiscal disaster. I suggest it means next year in the Budget Committee
the same thing is going to happen. There is going to be a whole list of
tax cuts and other things--mandatory spending--people wanted to get in
there. And they will say: We exempt this, and now we will make the pay-
go rule apply.
That is making a sham out of the pay-go rules. The ranking member,
for whom I have enormous admiration on this subject, hit it right on
the head. The people of this country are beginning to realize it has
all happened again, that they have been taken. We had rules in place
that the American people were thrilled to see work, leading to a
balanced budget and a surplus. Those rules are no longer there. Those
rules were allowed to expire at a time when this country was undergoing
enormous anxiety. But they are catching on. They caught on in 1992, and
they sent to Washington people who would deal with the deficit. They
are catching on again now. The Senator is right, this vote is ``the
vote'' about whether you are for balancing this Nation's budget or
whether you want deficits as far as the eye can see.
Mr. President, I yield to the Senator from Delaware who has been a
terrific advocate on this issue.
Mr. CARPER. I thank my colleague for yielding. I thank Senator
Feingold and others on our side and the other side of the aisle for
their work.
This is an important amendment. He is right. I don't know whether it
is the most important amendment offered on this resolution, but it may
well be. I would like to take a couple of minutes and look back a few
years to some of the things that have been said by folks in our country
and actually outside of our country.
I would like for us to go back to 2001, the first year George Bush
was President. What he said was:

We can proceed with tax relief without fear of budget
deficits.

We found out he was wrong.
A year or so later, he said:

Our budget will run a deficit that will be small and short
term.

I am sorry to say he was wrong again.
In 2003, he said:

Our current deficit is not large by historical standards
and is manageable.

That, too, is wrong.
This year, he is saying to us:

The deficit will be cut in half over the next 5 years.

Unfortunately, if we look more closely at what is going to happen
over the next 5 years and beyond, the deficit may be trimmed a little
bit, but it is going to begin to explode when my generation of baby
boomers starts to retire in 5 or 6 years.
I want to share with my colleagues another quotation that occurred
several years before these. It was not by an American but a fellow from
Great Britain, Dennis Healy. In the late 1970s, he was Chancellor of
the Exchequer. There was something he called the ``theory of holes.''
The theory of holes

[[Page S2513]]

goes something like this: When you find yourself in a hole, stop
digging.
We are in a hole. We are in a huge hole. The hole of debt is almost
$7 trillion, up from about $1 trillion in 1982. It is actually pretty
modest compared to the hole we are going to be in in 2014. This red
line represents money that we owe somebody. Those somebodies are going
to want to be repaid. Do some of the people lending money to Uncle Sam
live in this country? A lot of them don't. A lot of them live around
the world. As they see this red ink accumulate, and as they see a
nation not only living beyond its means financially through our Federal
deficits but a nation that buys a lot more from overseas than we
certainly sell to other countries, my fear is that what may well happen
is those other countries will lend us so much money, but in order to
continue to loan us more money, they are going to want a little higher
interest rate--maybe significantly higher--as our creditors. If we
begin to pay higher interest, we know what kind of adverse effect that
can have on the economy of this country.
Look at one other chart. This is about the year 1999, 2000, when the
budget deficits turned into surpluses. Now we are back in the soup.
This is what the deficit looks like. In 2004, it is about $600 billion.
The reason this looks higher than some of us are used to is because
this is the real operating deficit, when you take away the mask that is
provided by Social Security. Social Security is going into the surplus,
and it makes the operating deficit look smaller because we operate
under a unified budget. After dropping down, it picks up to about
three-quarters of a trillion dollars. That is 1 year. It will be over a
quarter of a trillion dollars in 2014.
A week or so ago Alan Greenspan was before the Banking Committee. He
was testifying. During the course of his testimony, and following his
testimony, we had the opportunity to ask him questions. I asked him
questions about the potential of interest rates rising and what that
might do to the economy. He expressed that could happen and, in fact,
it would be a chilling one for the American economy.

We also talked about the proposal before us today that Senator
Feingold is offering, this pay-as-you-go notion; the idea that if I
wanted to raise spending further above the baseline of spending already
built into our budget, I would have to come up with an offset. The idea
is that if I wanted to lower revenues, cut taxes in some area, I would
come up with an offset to equal out that effect.
I asked Chairman Greenspan--there are different approaches to pay-go.
One, I call it pay-go ``lite,'' where it would only affect the spending
side. If I had a spending increase I wanted to make, I would have to
come up with the offset. I said, How about the other side of a pay-as-
you-go, on the revenue side? I was trying to get him on the record to
say that the pay-as-you-go should be applied both on the spending side
and the revenue side.
This is what he said: What worked in the past is what we ought to do
now. That is what he said. What worked in the past is what you, the
Congress, ought to do now. What worked in the past? It was a pay-as-
you-go approach that applied to both spending and revenues. Frankly, it
worked real well in the past. It is not the only thing that worked
well, but it was helpful. We have the opportunity to put it back into
place. We ought to do it.
My dad, when I was a kid growing up, would say to my sister and me
when we would do some foolish stunt and not show any forethought: Just
use some common sense. My guess is, if we were on the floor today and I
asked Senator Feingold, or Senator Conrad, or the Presiding Officer, to
go back to your childhood and think about things your parents used to
say to you, you could all think of something they would say to you to
try to drum into your heads. My dad would say more times than I would
care to remember: Just use some common sense.
When we have an annual budget deficit that is approaching $600
billion, when we have a national debt that is now at about $7 trillion,
I think a good test of common sense is, when any Senator wants to raise
spending to make this situation worse, or any Senator wants to cut the
revenue base to make this situation worse, we ought to say: How are you
going to pay for it? If I don't have a good answer, we should not do
what I want to do--either raising spending or cutting revenues. In my
dad's words, that would be using common sense. We need some common
sense. This amendment will provide that.
Mr. FEINGOLD. Mr. President, how much time remains?
The PRESIDING OFFICER. Four minutes remain.
Mr. FEINGOLD. Mr. President, I yield to the Senator from North
Dakota.
Mr. CONRAD. I thank the Senator. I will take 2 minutes off the
resolution so the Senator will retain his time.
My colleagues, this amendment matters. We have a lot of amendments
that are important but that, frankly, are not going to do much about
our long-term fiscal condition. This amendment could make a real
contribution to getting these skyrocketing deficits under control. Why?
Because it says simply this: No new spending on the mandatory side, and
that is two-thirds of Federal spending; no new tax cuts that are not
paid for, unless you can get a supermajority vote.
This is one of the key budget disciplines we had through the 1990s
that helped us save hundreds of billions of dollars on the deficit.
This is what helped us move from record deficits to record surpluses.
This budget discipline was allowed to lapse in 2002, despite our best
efforts.
Senator Feingold and I made a last-ditch attempt to save these budget
disciplines and we got 59 votes. We needed 60. Look what has happened
since. Deficits have taken off like a scalded cat.
My colleagues, I think this vote is going to be evidence of whether
somebody is serious about fiscal discipline and restoring fiscal sanity
or whether they just want red ink as far as the eye can see. Make no
mistake, that is where we are headed. That is where we are headed under
the President's plan.
The President's plan adds $3 trillion to the national debt in the
next 5 years. The budget resolution is a little bit better; it adds
$2.86 trillion to the national debt in the next 5 years. All of this is
right before the baby boomers retire.
My colleagues, you cannot leave this Chamber calling yourself a
fiscal conservative unless you vote for this amendment. I urge my
colleagues to support the amendment of the Senator from Wisconsin.
Mr. McCAIN. Mr. President, I strongly support the amendment offered
by my good friend from Wisconsin.
We are facing a dire financial situation. The projected deficit for
the current fiscal year is $521 billion--that's over half of a trillion
dollars--the largest ever. That is why the Congress and the
administration must begin taking action this year, despite the fact
that it is an election year, to address this crisis. Our failure to
start making some of the tough decisions will land squarely on the
backs of our children and grandchildren, and their financial future
will be strapped with digging out of the holes that have been created
by our actions and inactions.
The Federal Reserve Chairman Alan Greenspan testified recently before
the House Budget Committee about the seriousness of our rising budget
deficit and, more specifically, the impact the deficit is going to have
on our future economic stability. He very clearly warned about the
consequences of a lack of fiscal discipline, and called for new steps
to restrain spending. The Chairman firmly supports reinstatement of the
pay-go rules as one such step.
According to a joint statement issued by the Committee for Economic
Development, the Concord Coalition, and the Center on Budget and Policy
Priorities, ``without a change in current (fiscal) policies, the
federal government can expect to run a cumulative deficit of $5
trillion over the next 10 years.''
These figures are shameful and frightening. Another astonishing part
of this report states that, ``after the baby boom generation starts to
retire in 2008, the combination of demographic pressures and rising
health care costs will result in the costs of Medicare, Medicaid and
Social Security growing faster than the economy. We project that by the
time today's newborns reach 40 years of age, the cost of these three
programs as a percentage of the economy will more than

[[Page S2514]]

double--from 8.5 percent of the GDP to over 17 percent.''
The Congressional Budget Office, CBO, also has issued warnings about
the dangers that lie ahead if we continue to spend in this manner.
According to a recent CBO report, due to rising health care costs and
an aging population, ``spending on entitlement programs--especially
Medicare, Medicaid and Social Security--will claim a sharply increasing
share of the nation's economic output over the coming decades.'' The
report went onto say that, ``unless taxation reaches levels that are
unprecedented in the United States, current spending policies will
probably be financially unsustainable over the next 50 years. An ever-
growing burden of federal debt held by the public would have a
corrosive . . . effect on the economy.'' Additionally, CBO has
projected a 10-year deficit of $4.4 trillion.
These are alarming figures. It is critical we take action to curtail
further deficit spending.
In the 1990s, when we faced what we thought to be the worst fiscal
situation possible, we passed the Budget Enforcement Act of 1990, which
instituted a number of statutory deficit control rules, including the
pay-as-you-go, pay-go, requirements. The statutory pay-go rules were
largely responsible for imposing true financial discipline on the
Congress when it came to mandatory spending programs and taxes.
Unfortunately, those rules expired in 2002.
We have an opportunity today to show the American public that we are
serious about digging out of the fiscal hole that faces our country by
adopting this amendment to strengthen the Senate pay-go point of order.
Although I wish we could reestablish the statutory pay-go rules, we
can't do that in the budget resolution since it is not a law. We can,
however, tighten up our own Senate rules to make it more difficult to
pass legislation that increases the deficit.
I would like to bring my colleagues' attention one of today's
editorials in the Washington Post, urging reinstatement of the pay-go
rules. I ask unanimous consent that a copy of the editorial be printed
in the Record immediately following my remarks.
The PRESIDING OFFICER. Without objection, it is so ordered.
(See exhibit 1.)
Mr. McCAIN. Mr. President, I want to clarify that I firmly support
the three proposed tax extensions in the pending budget resolution. I
fully expect that when tax legislation is considered by the Chamber in
the weeks ahead, it will include extensions of the marriage penalty tax
elimination, the $1,000 child tax credit, and expanding the 10 percent
income tax bracket as called for in this resolution, and I will support
such legislation. This amendment is not an amendment in opposition to
those provisions, but rather, an amendment to promote fiscal
responsibility and protect us from ourselves.
I urges my colleagues to support the amendment.

[From the Washington Post, Mar. 10, 2004]

Rigging the Budget Rules

When it comes to matters of taxes and spending, members of
Congress are like would-be dieters who can't stop raiding the
refrigerator. Recognizing this weakness, lawmakers have
resorted in the past to budget rules that act much like a
lock on the fridge. During the 1990s, these rules set
ceilings on discretionary spending and required that any tax
cuts or spending increases in entitlement programs be matched
by offsetting spending cuts or tax increases. As with the
dieter who knows where the key is hidden, the rules didn't
work perfectly--they could be avoided with a 60-vote
majority--but they did help curb lawmakers' natural
tendencies.
The rules expired at the end of 2002, and everyone from
President Bush to Federal Reserve Chairman Alan Greenspan to
Clinton Treasury Secretary Robert E. Rubin has called for
their renewal. ``Perhaps the single most important act
Congress and the Administration could take at this point to
rein in the budget over the next decade would be to re-
establish the budget rules that existed in the 1990s,'' Mr.
Rubin wrote in a recent paper co-authored with the Brookings
Institution's Peter R. Orszag and Allen Sinai of Decision
Economics Inc.
But the Bush administration, and some of its allies in
Congress, would rig the rules to apply discipline in a
dangerously lopsided fashion. The administration proposes
strict controls on spending but no restraints at all on
cutting taxes, an approach influenced by the administration's
inflated view of the beneficial effect of tax cuts. But even
for those who fully subscribe to the administration's
position on the relative merits of taxes and spending, it's
clear that such a rule would simply skew budgetary choices,
resulting in spending programs recast in the guise of tax
breaks. Mr. Greenspan reiterated last month that the rule
ought to apply to both spending increases and tax cuts.
Meanwhile, the budget resolution before the Senate would
leave in place the sham version of pay-as-you-go adopted last
year, in which the rule applies only to tax cuts or spending
increases in excess of what the budget resolution provides.
This year's model would permit $122 billion more in tax cuts
not offset by savings elsewhere. Under this meaningless form
of pay-as-you-go, senators promise every year to show
spending discipline--the next time around.
An effort to add an evenhanded pay-as-you-go rule failed on
a party-line vote in the Senate Budget Committee last week.
The Senate should fix that omission before it approves
another irresponsible budget. And lawmakers should show
discipline by requiring themselves to pay for all their tax
cuts--not carving our popular middle-class breaks like the
child tax credit, and certainly not speeding up repeal of the
estate tax, for special budgetary treatment.
The PRESIDING OFFICER. The Senator from Wisconsin is recognized.
Mr. FEINGOLD. Mr. President, I cannot tell you how pleased I am to
have the support of these two Senators. They are two Senators who are
consistently devoted to protecting the taxpayers in their State and in
the country. I find, more than anything else, people looking for
representatives who truly come out here and take the tough votes to
protect the interests of the taxpayers.
As I indicated before, they are figuring out that despite all the
troubles of the last couple of years, we have irresponsibly driven up
this country's deficit and debt to a point that is unprecedented in the
history of the country.
I am grateful to these two Senators. I remind everybody, this is a
bipartisan amendment. We have a Republican cosponsor, and there will be
other Republican votes for it. This is not your typical partisan
amendment or vote on a budget resolution. This is about what used to be
a consensus in this body. We ought to have some rules that are
consistent that will apply to all parts of the budget so that we can
work together on behalf of the American people to do something about
our very serious fiscal problems.
Mr. President, I reserve the remainder of my time.
Mr. NICKLES. Mr. President, how much time remains on both sides?
The PRESIDING OFFICER. The Senator from Oklahoma has 24 minutes. The
Senator from Wisconsin has 3 minutes.
Mr. NICKLES. Mr. President, to notify our colleagues, it will be my
intention to yield some time back and to vote, unless my colleague from
Iowa wishes to speak, at quarter to 6. We have three rollcall votes.
The first one will be on Senator Byrd's amendment to strike the
reconciliation provisions.
I notify my colleagues that rollcall votes will probably begin in the
next 10 minutes.
I have great respect for the authors of the amendment. I support pay-
go, but I think it should be pay-go with the present law tax cuts being
extended. If we do not, we are going to have tax increases. We ought to
let people keep the same tax rates they have today. I do not want to
lose the marriage penalty relief. That is what we are assuming in our
budget. This boils down to, we have pay-go on everything except these
child-friendly, marriage-friendly tax cuts. We want those to continue,
maybe not under pay-go.
Some people say let's raise somebody else's taxes to pay for them.
That is a recipe for getting nothing done. We want to continue present
law on the taxes. It is very interesting that present law on spending
does not have to be paid for. We have a lot of spending programs that
also have sunset provisions, but they do not have pay-go when they are
reauthorized, when they are extended.
If you extend the farm bill--I have a whole list of programs--
Temporary Assistance for Needy Families, food stamps, Commodity Credit
Corporation, veterans compensation, child care entitlements, and State
Children's Health Insurance Program. All these, and many more, are
temporary. They sunset. When they are extended, they are assumed to be
extended. They do not have to be paid for. But any tax cuts--when I say
tax cuts, marriage penalty relief, child credit taxes, the rates that
we now have, 35 percent maximum, 10 percent--that 10 percent

[[Page S2515]]

is now going to revert to 15 percent unless we pay for it? Oh, that
rate that is 25 percent today is going to go to 28 percent unless we
pay for it, but we do not make the appropriators pay for incremental
expense. They can increase appropriations by any amount. They do not
have to pay for it.

My point is we have basically identical pay-go under our resolution
as this amendment provides, except we assume present law, I stated a
while ago, with exception of AMT. AMT is basically an extension of
present law.
The resolution we have before us was well thought out. It says let's
keep present law intact, basically. Let's not have tax increases on
families. Let's not make it more difficult for people to keep present
law. Let's not tax them more next year under some rule, the present
law.
I know most of my colleagues do not want to increase taxes on those
families, so we put it in the budget. Anything above that has to be
paid for. So we have pay-go. If somebody says it does not work, they
did not look at the Senate last year. I happened to be chairman of the
Budget Committee. I requested somebody to make 60-some budget points of
order, almost all of which we prevailed on. If anybody thinks I am not
willing to use pay-go or any other budget rule to try and constrain
spending, I think the facts will show quite differently.
We will enforce the budget. The question is whether we are going to
allow people to keep the same rates they have today or assume they are
going to have a tax increase unless we find some other tax increase to
pay for it.
I urge our colleagues to vote against this amendment. I reserve the
remainder of my time.
The PRESIDING OFFICER. The Senator from Wisconsin.
Mr. FEINGOLD. Mr. President, I wish I could say what is in the budget
resolution before us is pay-go, but it is not pay-go. It is pay-go
without an absolutely critical component, and that is making it apply
to the tax cuts. It is almost like saying I want pay-go as long as it
does not apply to what I want, and that is not the pay-go that worked
in the 1990s. That is not the pay-go that brought us a balanced budget.
I have to reiterate, this does not stop the tax cuts the Senator from
Oklahoma is talking about--child care credit, 10-percent bracket,
marriage penalty. Not only can all of these survive under pay-go, they
will. They just need to get 60 votes. I predict in each case, they will
probably get 35 to 40 extra votes on top of that, if anyone even raises
the point of order. So it is simply false to say somehow this stops the
tax cuts from being extended.
Let's be honest about it. The only reason this exemption is needed is
those tax cuts were not made permanent. Had they been made permanent,
the Senator from Oklahoma would not have to be worrying about extending
them. Why weren't they made permanent? They weren't made permanent so
we could have this phony idea the deficit isn't as bad as it really is
out in the future years. It is a gimmick. It is a game to make them
temporary so you can say it is not going to cost more in the outyears.
Then when it comes time to face the music, what do we do? We say the
normal rules do not apply. We do not require ourselves to pay for it,
or we do not require the 60 votes that are normally needed.
Without the adoption of this amendment, we have done serious damage
to the integrity of the pay-go rules going into the future. A system of
rules such as this depends on the integrity of the rules, that they be
applied fairly and across the board. Allowing these exemptions, even
well-intentioned, with regard to certain tax cuts, undermines the
integrity of a system we all relied on to work in the 1990s.
Mr. President, I reserve the remainder of my time.
Mr. NICKLES. Mr. President how much time remains?
The PRESIDING OFFICER. The Senator from Oklahoma has 20 minutes.
Mr. NICKLES. I yield my colleague from Iowa such time as he desires.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I am going to oppose this amendment
because this amendment is not about paying for tax cuts; it is about
avoiding a tax increase. Although I understand the desire to impose
pay-go, it should not apply to current law, and that is a very
important distinction.
Under current law, we have a number of tax provisions, including the
expanded 10-percent tax bracket, the $1,000-per-child tax credit, and
marriage penalty relief that will expire at the end of this year. If we
do not extend these provisions, taxes will go up, and taxes will go up
automatically.
As I have said before in several other points I have been making on
other amendments, it is one thing for Congress to have guts enough to
vote a tax increase, but it is quite another to let taxes go up
automatically without a vote of the people. I think that is wrong.
In order to extend the existing tax law, we need to pass legislation
yet this year if we are going to have a seamless continuation of
present tax law into the year 2005 and beyond. That is what this
amendment is all about. We are going to either extend current law or we
are going to let taxes go up.
Requiring the Senate to pay for this tax relief we already have in
the law, that would not be in the law if we do not take some action
this year, could lead to disastrous results. We are talking about
disastrous results for families, such as if one is married and they get
hit with the marriage penalty, that is a major concern to those
families who have to pay more. If they have children and they benefit
from the $1,000 child credit and that credit goes down, that is going
to hit those families to a greater extent.
All families, low income or otherwise, but particularly this 10-
percent bracket was put in the law to help low-income Americans pay
less taxes. So it is a disastrous result on families, and we should not
have to go to the extra extreme of maintaining existing law. If for
some reason we could not agree on the necessary offsets that would be
required under Senator Feingold's amendment, or if we could not get 60
votes, then current law would expire and taxes would automatically go
up, without even any consideration by any of us. There would be 535
people just standing by and letting taxes go up.
Some people may be willing to take that risk, but I do not believe
that is the right approach. Consequently, we need to reject this
amendment. We need to support working families of America by extending
the tax reductions that have already been provided for under current
law. We need that to be seamless. We do not want to take any chance
somehow somebody is going to say next October, just before we adjourn
for the election, well, we will worry about this next year. That is a
bad situation to leave the families of America. They ought to know what
tax policy is for the long haul.
Certainty of tax policy is the best tax policy. Even if it might not
be exactly the right tax policy, certainty of tax policy is better than
the uncertain situation we have facing American working men and women
today.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I will be shortly yielding back the
remainder of our time. I believe our agreement was we would go to the
Byrd amendment first. I think we agreed to have 1 minute on each side
to recap the debate.
The PRESIDING OFFICER. That is correct.
Mr. NICKLES. I have already asked Senator Byrd to come in. Has the
Senator from Wisconsin concluded?
Mr. FEINGOLD. Mr. President, I want to know, do I have 30 seconds
remaining?
The PRESIDING OFFICER. That is correct.
Mr. FEINGOLD. Let me point out to the Senator from Iowa, for whom I
also have enormous regard and really enjoy working with, he indicated
he wanted to make sure this pay-go goes through the way they have it in
the budget resolution in order to make sure tax cuts that are current
law continue. The fact is they are not in current law. The current law
says they shall expire. That is the law. The law is they are going to
expire.
In order to continue these tax cuts, a new law must be passed. All I
am saying is the pay-go rule should apply to that new law, to those new
tax cuts, because otherwise we are not applying the rules that are
applied to everything

[[Page S2516]]

else. I think it is an important distinction.
It is not by accident these were set up to expire.
They would have been in violation of the budget because they caused
deficits in the outgoing years.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, my colleague from Wisconsin is correct,
these tax changes we made last year expire at the end of this year.
Actually, I think they have been in effect for 2 years. If we do not
extend them, it is going to be a tax increase on American families. We
are trying to protect American families.
I heard my colleague from Wisconsin say we want to protect taxpayers.
That is exactly what we are trying to do. We are basically saying over
$13 trillion in spending and about $12 trillion in revenues. The only
thing we are trying to protect over the next 5 years is $144 billion.
That is basically extending present law to make sure people do not have
a tax increase from what their tax rates are today. Above that, we have
pay-go. That is basically what our resolution says, with the exception
of the energy bill, and perhaps one other minor provision; AMT is an
extension of present law.
We do not want the families who are paying taxes today to have a big
tax increase, if they have 4 kids, of $2,200 next year. So we said
everything else, yes, is pay-go. We do not have pay-go for the farm
bill. We do not have pay-go for all of these multitude of entitlement
programs I mentioned. They all sunset. They all expire at a certain
period of time. There are some real inequities, almost a bias, for more
spending. We do not have pay-go for incremental increases in
discretionary spending, but we say, oh, if you want to keep your
present tax level, you have to pay for it.
What some people mean by that is we want to have higher taxes on
somebody else. The net result could be, especially in a political year,
one where the partisan feelings are so strong you would end up with no
tax bill, which ends up increasing taxes on American families. I do not
want that to happen.

If we look at the total amount of money spent, the difference is $144
billion. We are saying we want to apply pay-go above everything else.
When talking about $13 trillion, it is not that significant. I think it
is important to protect the $144 billion, so we protect American
families so they do not have a tax increase next year.
I reserve the remainder of my time and yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. On our side, it is my understanding Senator Levin has 5
minutes remaining.
Mr. NICKLES. That is correct.
Mr. REID. I ask Senator Feingold have 1 minute of that 5 minutes.
Mr. NICKLES. We could go back and forth all day. I would like to
start the rollcall vote very quickly. If Senator Levin is in the
Chamber, this would be the time for him to speak.
Mr. REID. He is not going to use his time.
Mr. NICKLES. If Senator Feingold wants an additional minute, that
will be fine. I will take an additional minute.
Mr. REID. I will yield back the 4 minutes when he finishes his time.
Mr. NICKLES. I would be happy to grant Senator Feingold an additional
minute. I will take an additional minute and then we will hear from
Senator Byrd and we will vote.
The PRESIDING OFFICER. The Senator from Wisconsin.
Mr. FEINGOLD. Mr. President, I appreciate the opportunity to debate
the Senator from Oklahoma. I join with him on the issue when it comes
to the taxpayers. The lesson we learned in the 1990s is the worst thing
that can be done to the taxpayers of this country is to run record
deficits and destroy the fiscal integrity of this country.
The only question is: Are we going to have across-the-board, tough
budget rules to protect the taxpayer dollars, or are we going to have
holes in those rules that will make sure the taxpayers get in a deeper
hole with the deficits?
Those tax cuts will not be denied because of these rules this year.
The taxpayers of this country will get the 10 percent. They will get
the continued elimination of the marriage penalty. They will get the
child care credit. If we go with my amendment, they will get that and
also get the fiscal discipline rules that brought them a balanced
budget at the end of the 1990s.
I yield the floor.
The PRESIDING OFFICER. The Democratic whip.
Mr. REID. Mr. President, would the distinguished manager of the bill
entertain having the second 2 votes 10-minute votes rather than 15-
minute votes?
Mr. NICKLES. I was going to make that request.
Mr. President, I yield the remainder of my time. What we agreed to do
previously was to stack the three votes. Senator Byrd would be first.
We agreed to have the proponents and opponents each have a minute
before each vote. I ask unanimous consent that we vote on Senator
Byrd's amendment and that the following two votes be limited to 10
minutes each.
The PRESIDING OFFICER. Is there objection?
Mr. BYRD. Mr. President, reserving the right to object, I wanted to
inquire if I might find a way to speak for not to exceed 2 minutes in
opposition to the amendment that is offered by Senators Warner and
Stevens.
Mr. REID. I have no problem with that.
Mr. NICKLES. I modify my request so that there be 2 minutes on each
side prior to the vote on the amendment of Senator Warner and Senator
Stevens.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. REID. Mr. President, have the yeas and nays been ordered?
The PRESIDING OFFICER. The yeas and nays have not been ordered.
Mr. REID. I ask for the yeas and nays for the Byrd amendment.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I believe our regular order would be we
would revert to the Byrd amendment with 1 minute debate on each side.
The PRESIDING OFFICER. That is correct. Is the Senator yielding back
his time on the Feingold amendment?
Mr. FEINGOLD. I ask for the yeas and nays.
Mr. NICKLES. I yield the remainder of my time on the Feingold
amendment.
Mr. REID. I yield Senator Levin's time.
The PRESIDING OFFICER. Is there an objection to the request of the
Senator that the yeas and nays be ordered?
Is there a sufficient second? There appears to be.
The yeas and nays were ordered.
Mr. FEINGOLD. Mr. President, I ask for the yeas and nays on my
amendment.
The PRESIDING OFFICER. Is there a sufficient second? There appears to
be.
The yeas and nays were ordered.

Amendment No. 2735

The PRESIDING OFFICER. The Senator from West Virginia is recognized
for 1 minute.
Mr. BYRD. Mr. President, the debate about budget deficits is taking
place all across this country. Ironically, the one place where debate
is discouraged on this matter is right here in the world's greatest
deliberative body. My amendment would strike the tax reconciliation
instructions to the Finance Committee that would shield tax cut
legislation that worsens the deficit from a thorough debate in the
Senate.
To use reconciliation to increase the deficit is an abuse of the
budget process. It doesn't matter whether it is an $81 billion tax cut,
a $350 billion tax cut, or a $1.35 trillion tax cut, the Budget Act
framers--and I was one of them--did not contemplate all this
difficulty, did not contemplate reconciliation would ever be used to
worsen the deficit. Not until 1999, after 25 years of restraint, was
this abuse of the process first perpetrated.
If this budget resolution passes with these reconciliation
instructions included, the Senate will be denied the opportunity to
forge a consensus that would allow it to extend these tax cuts and pay
for them.
That is the issue on which we vote today. A vote to strike the
reconciliation instructions is a vote to allow the Senate to work its
will and to permit the further worsening of the deficit. I urge my
colleagues to support the amendment, and I thank the Chair.
Mr. NICKLES. I alert my colleagues we are going to start 3 rollcall
votes momentarily.

[[Page S2517]]

The only way to make sure there is not a tax increase on American
families is to pass reconciliation. Maybe we don't need it. I hope we
don't need it. Maybe we will have some good bipartisan cooperation and
we can extend present law to make sure these families don't have a tax
increase, but this is a pretty partisan time. We can't even get
conferees appointed to the Workforce Reinvestment Act, which would help
people to get jobs. Some people are just playing games. I don't want to
play games with the American family. We only reconcile $81 billion out
of $12 trillion.

I want families to have a tax cut. I want them to keep the same tax
law they have today. That is a savings of $1,600 for a family of four
that has taxable income of $58,000. The only way we can really assure
that is going to happen, or increase the likelihood that will happen,
will be to have reconciliation. I wish that wasn't necessary, but
unfortunately it is. You can have a lot of people play games with the
tax bill if it comes through and it has unlimited amendments.
Maybe we won't need reconciliation. Chairman Grassley asked me to
make sure we have it as an option, and I think it is important to do
so. If we don't, you may well see the $1,000 tax credit per child go to
$700, you may well see the marriage penalty relief disappear and
increase taxes on couples $900. I urge our colleagues to vote no on the
amendment.
The PRESIDING OFFICER. The question is on agreeing to the amendment.
The yeas and nays have been ordered. The clerk will call the roll.
The legislative clerk called the roll.
Mr. REID. I announce that the Senator from South Dakota (Mr. Johnson)
is necessarily absent.
The PRESIDING OFFICER (Mr. Alexander). Are there any other Senators
in the Chamber desiring to vote?
The result was announced--yeas 47, nays 52, as follows:

[Rollcall Vote No. 36 Leg.]

YEAS--47

Akaka
Baucus
Bayh
Biden
Bingaman
Boxer
Breaux
Byrd
Cantwell
Carper
Chafee
Clinton
Conrad
Corzine
Daschle
Dayton
Dodd
Dorgan
Durbin
Edwards
Feingold
Feinstein
Graham (FL)
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Mikulski
Murray
Nelson (FL)
Pryor
Reed
Reid
Rockefeller
Sarbanes
Schumer
Stabenow
Wyden

NAYS--52

Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Campbell
Chambliss
Cochran
Coleman
Collins
Cornyn
Craig
Crapo
DeWine
Dole
Domenici
Ensign
Enzi
Fitzgerald
Frist
Graham (SC)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Kyl
Lott
Lugar
McCain
McConnell
Miller
Murkowski
Nelson (NE)
Nickles
Roberts
Santorum
Sessions
Shelby
Smith
Snowe
Specter
Stevens
Sununu
Talent
Thomas
Voinovich
Warner

NOT VOTING--1

Johnson

The amendment (No. 2735) was rejected.
Mr. NICKLES. I move to reconsider the vote.
Mr. CRAIG. I move to lay that motion on the table.
The motion to lay on the table was agreed to.

Amendment No. 2742

The PRESIDING OFFICER. There are now 4 minutes evenly divided prior
to a vote on the Warner amendment.
The Senator from Virginia.
Mr. WARNER. Mr. President, of the 2 minutes under my control, I would
like to give a minute to my distinguished colleague, Senator Stevens.
The PRESIDING OFFICER. The Senator from Alaska.
Mr. STEVENS. Mr. President, the amendment I have cosponsored with
Senator Warner will restore the President's request for the Department
of Defense. I understand the reasons why the Budget Committee did not
bring this full number out of the committee, but we wish to restore the
President's request in full.
We are engaged in a global war against terrorism. We have troops in
Afghanistan, Iraq, and Haiti. More than half of our forces are overseas
at the present time. I do not think it is time for us to cut the
President's request for the Department of Defense.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. WARNER. Mr. President, I will be happy to follow with the
remainder of my time, if the other side wishes to address this issue.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, on this side we urge our colleagues to
support this amendment. We think when our forces are in the field, when
they are in combat half a world away, we ought to meet the Commander in
Chief's request for funding.
We will offer an amendment at a later point in the queue to fully pay
for this amendment. We think that is an appropriate way to handle this
matter. But for the moment, on this amendment, we think the right vote
is to support the request of the Commander in Chief while our forces
are in combat.
The PRESIDING OFFICER. The Senator from West Virginia.
Mr. BYRD. Mr. President, how much time do I have?
The PRESIDING OFFICER. Two minutes in opposition.
The Senator from Virginia.
Mr. BYRD. Mr. President, I have the utmost respect for the two
authors of this amendment. They know that.
The Defense Department is plagued with accounting problems so severe
that the Secretary of Defense cannot account for billions of taxpayer
dollars. The General Accounting Office estimates the very earliest the
Defense Department could possibly pass an audit would be 2007, and that
is optimistic. The administration does not even know how much time and
how much money it will take to fix the accounting problems.
It is absurd that the administration is proposing to cut vital
domestic investments while billions and billions of dollars are lost
every year in the Pentagon's broken accounting system. Such waste would
not be tolerated from any other Department.
I suggest the Pentagon would be more careful with its money if it had
less of it to waste. The Defense Department's budget is already bloated
at $414 billion. I cannot support this amendment to add another $6.9
billion to the budget resolution for the Pentagon when it cannot
explain to the American taxpayers how their hard-earned money is being
spent.
Mr. President, I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. WARNER. Mr. President, I say to my distinguished colleague in
reply that you have brought this to the attention of the Senate year
after year, as you should.
Mr. BYRD. Yes.
Mr. WARNER. We are endeavoring, through oversight and otherwise, to
correct it. But those problems in no way are owing to the valor of the
men and women in uniform and their families.
Mr. BYRD. Right.
Mr. WARNER. That is what this vote is for.
I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I want to remind our colleagues, this is
a 10-minute rollcall vote. We will have one other vote immediately
following that. For the information of our colleagues, it is our
expectation to have more rollcall votes, probably to begin at around
8:45.
The PRESIDING OFFICER. The question is on agreeing to amendment No.
2742.
Mr. NICKLES. Mr. President, I ask for the yeas and nays.
Mr. WARNER. Mr. President, the yeas and nays have already been
ordered.
The PRESIDING OFFICER. The yeas and nays were ordered.
The clerk will call the roll.
The bill clerk called the roll.
Mr. REID. I announce that the Senator from South Dakota (Mr. Johnson)
is necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 95, nays 4, as follows:

[[Page S2518]]

[Rollcall Vote No. 37 Leg.]

YEAS--95

Akaka
Alexander
Allard
Allen
Baucus
Bayh
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Brownback
Bunning
Burns
Campbell
Cantwell
Chafee
Chambliss
Clinton
Cochran
Coleman
Collins
Conrad
Cornyn
Corzine
Craig
Crapo
Daschle
Dayton
DeWine
Dodd
Dole
Domenici
Dorgan
Durbin
Edwards
Ensign
Enzi
Feingold
Feinstein
Fitzgerald
Frist
Graham (FL)
Graham (SC)
Grassley
Hagel
Harkin
Hatch
Hollings
Hutchison
Inhofe
Inouye
Kennedy
Kerry
Kohl
Kyl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Lott
Lugar
McCain
McConnell
Mikulski
Miller
Murkowski
Murray
Nelson (FL)
Nelson (NE)
Nickles
Pryor
Reed
Reid
Roberts
Rockefeller
Santorum
Sarbanes
Schumer
Sessions
Shelby
Smith
Snowe
Specter
Stabenow
Stevens
Sununu
Talent
Thomas
Voinovich
Warner
Wyden

NAYS--4

Byrd
Carper
Gregg
Jeffords

NOT VOTING--1

Johnson

The amendment (No. 2742) was agreed to.
Mr. WARNER. Mr. President, I move to reconsider the vote.
Mr. CONRAD. I move to lay that on the table.
The motion to lay on the table was agreed to.

Amendment No. 2748

The PRESIDING OFFICER. There will now be 2 minutes of debate, evenly
divided, prior to a vote on the Feingold amendment.
The Senator from Wisconsin.
Mr. FEINGOLD. Mr. President, this amendment will simply return us to
the rules by which Congress played in the decade of the 1990s. We
eliminate the exceptions to pay-go included in last year's resolution
that exempt new tax cuts and new mandatory spending included in the
budget resolution, an exception that facilitates more damage to the
Federal bottom line.
This amendment will not--I repeat, will not--prevent the extension of
the expiring 10-percent bracket or the child tax credit or the marriage
penalty. This body will vote to extend those tax cuts by a huge margin,
and I will be part of that huge margin. But this amendment will return
some of the budget discipline that helped us balance the budget.
Deficits matter. Debt matters. Let's not leave our children and
grandchildren with an even bigger tab than we have already stuck them
with.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I urge our colleagues to vote no on this
amendment. These are the tax cuts we are trying to protect. Everything,
basically other than that with a minor couple other things, is pay-go.
We have pay-go on everything that is not assumed in the budget. This
chart shows most of it. That is tax relief for American families.
We should protect taxpayers. We do not have pay-go for expansion of
entitlements that sunset, but we do for tax cuts that are sunset. That
is not fair to the taxpayers. Let us protect taxpayers.
We have pay-go in the underlying resolution. Last year, I and others
made 62 points of order to cut spending. We used pay-go. We will use it
again this year. We have it in this budget resolution. I urge my
colleagues to vote no on the Feingold amendment.
For the information of colleagues, we expect to have about a 2-hour
window, and we expect to have more rollcall votes probably beginning
about 8:45 or 9 p.m.
The PRESIDING OFFICER. The Senator from West Virginia.
Mr. BYRD. Mr. President, parliamentary inquiry.
The PRESIDING OFFICER. The Senator will state his inquiry.
Mr. BYRD. How much time was consumed on the last rollcall?
The PRESIDING OFFICER. Nineteen minutes.
Mr. BYRD. Nineteen minutes. I thank the Chair.
The PRESIDING OFFICER. The question is on agreeing to amendment No.
2748. The yeas and nays have been ordered. The clerk will call the
roll.
Mr. REID. I announce that the Senator from South Dakota (Mr. Johnson)
is necessarily absent.
The PRESIDING OFFICER (Mr. Coleman). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 51, nays 48, as follows:

[Rollcall Vote No. 38 Leg.]

YEAS--51

Akaka
Baucus
Bayh
Biden
Bingaman
Boxer
Breaux
Byrd
Cantwell
Carper
Chafee
Clinton
Collins
Conrad
Corzine
Daschle
Dayton
Dodd
Dorgan
Durbin
Edwards
Feingold
Feinstein
Graham (FL)
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
McCain
Mikulski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Reed
Reid
Rockefeller
Sarbanes
Schumer
Snowe
Stabenow
Wyden

NAYS--48

Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Campbell
Chambliss
Cochran
Coleman
Cornyn
Craig
Crapo
DeWine
Dole
Domenici
Ensign
Enzi
Fitzgerald
Frist
Graham (SC)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Kyl
Lott
Lugar
McConnell
Miller
Murkowski
Nickles
Roberts
Santorum
Sessions
Shelby
Smith
Specter
Stevens
Sununu
Talent
Thomas
Voinovich
Warner

NOT VOTING--1

Johnson

The amendment (No. 2748) was agreed to.
Mr. CONRAD. Mr. President, I move to reconsider the vote.
Mrs. CLINTON. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, for the information of our colleagues,
Senator Conrad and I are trying to work out an agreement on which
amendments will be going next. I believe we have an understanding that
Senator Baucus will offer an amendment. At that point, Senator
Voinovich will offer an amendment, and I think I will stop there. I
know Senator Conrad is trying to line up one or two more.
It is our hope that people would not want too much time on their
amendments so we could expedite as many amendments as possible.
Again I will repeat, we expect votes to occur probably shortly before
9.
The PRESIDING OFFICER. The Senator from Montana.

Amendment No. 2751

Mr. BAUCUS. I have an amendment at the desk and I ask for its
immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Montana [Mr. Baucus] proposes an amendment
numbered 2751.

Mr. BAUCUS. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To strike the outlay reconciliation instruction to the
Committee on Finance)

Strike section 201(c).

Mr. BAUCUS. Mr. President, this amendment would eliminate the
reconciliation instruction in the budget resolution directing the
Finance Committee to produce savings in mandatory programs within the
committee's jurisdiction. The amendment is based on an assumption in
the resolution that our committee would cut Medicaid by $11 billion
over 5 years, and reduce earned-income tax credit outlays by $3
billion.
Let me begin by clearing up one common misconception. Some may think
the budget calls for the Finance Committee to produce legislation that
saves $3.4 billion over 5 years, since that is the figure in the
reconciliation instruction. In fact, the Finance Committee would have
to produce $21.6 billion in savings. Why? Because the budget resolution
calls for extending the child tax credit and marriage penalty relief.
Since a portion of the child tax credit and marriage penalty relief

[[Page S2519]]

is refundable, these count as outlays in the budget process. So
extending the child tax credit and marriage penalty relief, as the
President has proposed and as the budget resolution provides, and which
I support and I think the vast majority of Members of this body
support, it will have the effect of increasing outlays also by $18.2
billion over 5 years.
To produce legislation that generates net outlay reductions of $3.4
billion, and the additional $8.2 billion cost, the Finance Committee
would have to draft legislation to reduce spending by $21.6 billion--
again, not the $3.4 billion over 5 years, which is the figure in the
budget resolution. It would actually have to be $21.6 billion.
The budget resolution assumes the Finance Committee will pass
legislation that cuts Medicaid by $11 billion and cuts the earned-
income tax credit by $3 billion and comes up with the remaining $7.6
billion by extending customs user fees.
Mr. CONRAD. Will the Senator withhold for one moment? I apologize.
Mr. BAUCUS. Absolutely.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. Chairman, would you like to present a unanimous
consent request on time agreements on the next four amendments?
Mr. NICKLES. Mr. President, we have three or four amendments in the
queue. I believe they are the amendment of Senator Baucus, the
amendment of Senator Voinovich, the amendment of Senator Nelson, and
the amendment of Senator Corzine.
I ask unanimous consent there be 30 minutes equally divided on each
of those four amendments.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. SARBANES. Reserving the right to object, can I get in that queue?
The PRESIDING OFFICER. The Senator from Maryland.
Mr. BAUCUS. Mr. President, I reserve the right to object, too.
Mr. SARBANES. Can I get on that queue?
Mr. NICKLES. You would have to talk to your manager.
Mr. CONRAD. I will be happy to make that the fifth amendment.
Mr. NICKLES. What amendment would that be?
Mr. CONRAD. The firefighters amendment.
Mr. NICKLES. I am not familiar with the amendment. I would like to
see it. I expect I would agree to it.
Mr. CONRAD. It is the amendment offered in the committee. I would say
what we would like to accomplish. The next round of votes has been set
for 8:45 or 9 o'clock. We would like to get the next group of
amendments debated so they could be voted on at that time. That is why
we are trying to have very tight time limits on these amendments. Would
that be agreeable to the Senator?

Mr. BAUCUS. Mr. President, actually it is not agreeable. I would like
an hour. I may not use it all, but I would like an hour, equally
divided.
Mr. CONRAD. Equally divided. I ask the chairman, could we say we have
an hour equally divided on that amendment and 30 minutes on the other
three, equally divided, and reach that agreement?
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. I will modify the request that there be an hour equally
divided on the Baucus amendment and the other three amendments I
referred to be equally divided.
The PRESIDING OFFICER. Is there objection?
Mr. SARBANES. I object. I object.
The PRESIDING OFFICER. Objection is heard. The Senator from Montana
has the floor.
Mr. BAUCUS. Mr. President, let me just recap briefly so Senators
understand my amendment. I explained where we were before the break in
the action.
I am offering an amendment which would eliminate the reconciliation
instruction to the budget resolution directing the Finance Committee to
produce savings in mandatory programs within the Finance Committee's
jurisdiction. The amendment, as I mentioned earlier, is based on the
assumption in the resolution that the committee would cut Medicaid by
$11 billion over 5 years and reduce the earned-income tax credit
outlays by $3 billion.
Some may think the budget calls for the Finance Committee to produce
legislation that saves $3.4 billion over 5 years, since that is the
figure in the reconciliation. Actually, the committee would have to
produce savings of $21.6 billion, and that is basically because the
resolution calls for extending the child tax credit and the marriage
penalty relief, as the President has proposed, and as provided for in
the budget resolution and which I support. I think the vast majority of
the Members here support it.
As a consequence of all that, the outlays have to be increased $18.2
billion over 5 years, and that is, again, because the earned-income tax
credit is refundable. So you add it all together and it actually comes
up to $21.6 billion that has to be cut, not the figure of $3.4 billion
contained in the budget resolution.
I might add that I think neither the earned-income tax credit cuts
nor the Medicaid cuts make a lot of sense. Let me start with the
earned-income tax credit. That is a feature in the Tax Code that
President Reagan once hailed as--and let me give his quote:

. . . the best anti-poverty, the best pro-family, the best
yet creative measure to come out of Congress.

I think he is right. The earned-income tax credit has done a lot to
lift people out of poverty.
President Bush has not proposed any reductions in the earned-income
tax credit, and with good reason. The earned-income tax credit was
created in 1975 as a bipartisan effort to reduce the tax burden on low-
income Americans. It provides a powerful incentive for people to work.
It has played a very large role in moving poor families from welfare to
work. It has reduced poverty.

Nearly 4.8 million people, including 2.6 million children, are lifted
out of poverty each year because of the EITC. By all accounts, the
earned-income tax credit has been successful, and it has been
effective.
While the earned-income tax credit has achieved its policy aims, and
I might add with incredible success, a 1999 Treasury audit of EITC
returns shows that noncompliance is a problem. And it is a problem.
Noncompliance in the EITC has been a problem. I believe, however, that
noncompliance on the earned-income tax credit is largely due to errors,
not because of fraud. Both the complexity of the tax credit and the
complex living situations are responsible for the high error rate.
Let me give an example. There is an IRS publication called
publication 596. That is the IRS instructions and forms for the earned-
income tax credit. Guess what. It is 52 pages long. Can you imagine
somebody sitting down at his or her kitchen table trying to figure out
the earned-income tax credit? The IRS takes more pages to explain the
earned-income tax credit than it does to explain the complicated
alternative minimum tax. Guess how many pages are in that. Eight. They
are eight terrible pages, but there are only eight of them. The EITC
booklet has 52 pages. Obviously, it is unnecessary complexity.
Senator Grassley and I fashioned a series of reforms that were
enacted as part of the 2001 tax cut legislation. The Treasury expects
those changes alone will reduce earned-income tax credit overpayments
by about $2 billion a year. So we are doing something about it. We all
recognize more needs to be done, and we will all work together to see
that this work gets done.
But the remaining work is administrative; it is not legislative. As
this administration has indicated, finding ways to identify earned-
income tax filers who were not compliant, and to save money by
preventing losses to the Treasury, is primarily an administrative
issue, not one that can be achieved through legislation. One can't
simply wave a wand and pass a law mandating a lower error rate. That
takes a lot of administrative work. The IRS and Treasury are working on
it now. They are conducting a major pilot project to test new
procedures which the agency hopes will reduce overpayments. I hope the
Treasury reduces overpayments, and the IRS is also likely to conduct a
second pilot this summer. I and other Senators want to see whether
these procedures work, while making sure

[[Page S2520]]

they don't cause honest, eligible working families to lose earned-
income tax payments for which they qualify.
But I believe administrative action is the proper course. Let me
reiterate that no legislative remedies are at hand that the Joint
Committee on Taxation has found will generate significant savings--no
legislation. Reducing errors is primarily administrative, and the
budget resolution's reconciliation instructions to the Finance
Committee would unfortunately force the committee to cut the EITC
itself. It doesn't really address the error rate.
For hard-working, low-income families, the EITC offsets income,
payroll, or Federal excise taxes. It would thus raise taxes for these
working families; that is, if the EITC were cut.
It is bad enough we continue to let the minimum wage erode. We should
not be raising the taxes on the working poor on top of that by cutting
the EITC. The Senate should take a firm stand against raising taxes on
working Americans.
The chairman's mark in the Budget Committee last week lays out two
ways to achieve these so-called EITC savings. One way is a tax
increase, pure and simple. The other way is administratively infeasible
and would generate strong opposition from small business owners. The
only way the second method could be designed so it would save money
would be to make it, too, into a tax increase. Let me explain.
The first of two options in the chairman's mark is to repeal the EITC
for very poor workers, particularly workers without children. According
to the IRS, some 3.7 million low-income workers received this credit in
the year 2003 and secured an average tax credit of a little over $200
each. These workers are among the poorest, lowest paid workers in the
country. Only single workers with incomes below $11,490, and married
couples with incomes below $12,490, would even qualify.
This credit equals a maximum of 7.65 percent of the first $5,000 in
wages these workers earn. As a result, this credit simply offsets some
or all of the employee share of the payroll taxes these workers pay.
Repeal it and the net Federal tax burden on these workers rises.
Furthermore, if this tax credit is repealed, poor, single workers
will begin owing Federal income tax in addition to their payroll taxes
when their earnings only reach $7,950. That is nearly $2,000 below the
poverty line. We can't do that. Such a change would literally tax these
low-paid workers deeper into poverty.
The other option the chairman's mark lists for achieving these EITC
savings is to require workers to get their EITC payments in their
paychecks rather than in the refund when they file their tax returns at
the end of the year. This is unworkable.
First, some small employers will find it very difficult to do. They
would have to have additional complexity to do it. Second, many workers
will not want to do this because they believe their earnings or their
spouse's earnings may rise during the year which would make them
eligible for a smaller EITC or no EITC at all, and if they received
EITC payments during the part of the year their family's income was
lower, they would have to write the IRS a check paying back the EITC
when they file their tax returns. Not everyone in this situation is
likely to file a separate amended tax return or have the cash to pay
the EITC back. As a result, this could actually increase errors. It
could increase overpayments as well as causing many families
considerable difficulty.
It would not save money. Suppose you instituted this system starting
in the tax year 2005. It means next year low-income workers would
receive both their EITC tax refund for the tax year 2004 and their EITC
payments for tax year 2005 which would be provided in their paychecks
throughout the year. The result would be the earned-income tax credit
costs would nearly double in 2005. That would increase costs, not
reduce them.
This is not the time to cut Medicaid. Medicaid provides a crucial
health care lifeline to more than 50 million Americans. It is a
critical player in our health care safety net. Medicaid pays for about
40 percent of all births in this country. It pays for almost half of
all nursing home days. Its reach stretches throughout the health care
system, and substantial costs will be felt in every corner of this
Nation if this cut were to proceed.

Even without these proposed cuts, Medicaid beneficiaries and
providers are facing a very difficult year. Many States have not yet
emerged from their worst financial crisis in several decades, and
Medicaid programs have been cut in virtually every State in the past 2
years. In fact, over the past 2 years, States have instituted Medicaid
changes that have resulted in between 1.2 million to 1.6 million low-
income children, parents, elderly, and disabled people losing coverage
and becoming uninsured.
Benefits and provider payments have also been cut, resulting in
beneficiaries' reduced access to needed services and greater cost
shifting to individuals who are insured. The liability of our health
care safety net is threatened. These cuts would have been significantly
steeper had Congress not provided States with $20 billion in fiscal
relief last year.
Even after these Medicaid cuts and other budget cuts--and in many
States tax increases--States still face a new round of deficits
estimated at $40 billion in the coming year. Despite this news, the
Federal fiscal relief is ending with the result that deeper Medicaid
cuts are likely. The last thing we need to do now is to reduce Federal
funding for Medicaid further and force deeper cuts in Medicaid.
We should instead heed the bipartisan warnings of the National
Governors Association. In a letter last week, the National Governors
Association chair and vice chair, Governor Kempthorne of Idaho and
Governor Warner of Virginia, had this to say:

States are currently emerging from the most severe budget
crisis since World War II. And nearly every State has enacted
difficult cuts to its Medicaid program, including both
eligibility levels and provider payments. Federal funding
reductions would force States to implement even deeper cuts
by restricting eligibility, eliminating or reducing critical
health benefits, and cutting or freezing provider
reimbursement rates. As a result, the Medicaid funding cuts
could add millions more to the ranks of the uninsured and
would harm our Nation's health care safety net.

We should listen to the Governors. They are bipartisan. This is not a
bipartisan issue.
Opposition to the cuts extends beyond the Governors to hundreds of
organizations of hospitals, doctors, nurses, veterans, disability
advocates, patients' advocates, and nursing homes.
Some have argued the savings could come--harmlessly, they seem to
suggest--by merely cutting ``fraud and abuse,'' particularly in State
financing arrangements. But this is a false premise. Not one, not the
administration and not the chairman of the Budget Committee--not one--
has proposed a policy to limit State financing arrangements they decry.
The administration's exhortations on this matter are so vague the
Congressional Budget Office has not scored the administration's
proposal as producing any savings in Medicaid. No one has even claimed
any specific proposals could raise $11 billion as essentially called
for in this reconciliation instruction.
To be clear, Congress has addressed the fraud we hear about.
The Finance Committee takes very seriously its oversight of the
programs within its jurisdiction. The committee is dedicated to
maintaining program integrity and ensuring taxpayer dollars are used
wisely and efficiently. I am as strongly opposed to fraud as any
Senator. But mandatory budget cuts are a blunt instrument unsuited to
address this difficult, complex problem, particularly in the absence of
specific administration proposals the Congressional Budget Office
scores as producing savings.
Some have argued this budget reconciliation instruction doesn't
matter. They argue if the Finance Committee does not want to make these
cuts, then it can simply not act.
But I ask, What if the House committees of jurisdiction do act? If
the House passes a reconciliation bill, any single Senator could then
use rule XIV to put that bill on the calendar, bypassing the Finance
Committee. The Senate could then be facing a fast-track vehicle to make
unfair spending cuts that fall in the Finance Committee's jurisdiction
without the committee ever having participated in the effort.
I have high confidence in the chairman of the committee, Senator
Grassley of Iowa. He will find a good way to

[[Page S2521]]

deal with Medicaid and with Medicare. He is very fair. He works with
all Senators. I think that is by far the preferable procedure rather
than the fast-track procedure as I mentioned under rule XIV which
bypasses the committee. It could well happen, if the House acts.
Finally, I note the House budget is likely to reconcile much deeper
cuts in these programs while acting as though all such savings can
somehow be achieved by wishing away ``fraud, waste, and abuse.'' I am
deeply concerned about conference deliberations on this matter.
This reconciliation instruction is a very dangerous provision. It is
one that could do real damage. My amendment to strike this
reconciliation instruction enjoys widespread support from many
Governors, many health care providers, and organizations dedicated to
helping the Nation's children, among countless others.
I urge my colleagues to join me in supporting the amendment.
I yield 10 minutes to the Senator from Hawaii to also speak on this
amendment.
The PRESIDING OFFICER. The Senator from Hawaii.
Mr. AKAKA. Mr. President, I rise to support an amendment offered by
my colleague from Montana, Senator Baucus, the ranking member of the
Finance Committee. His amendment seeks to right wrongs perpetuated
against low-income families in the budget resolution before us. As he
has explained, the pending resolution seeks to make room for further
tax cuts by instructing the Finance Committee to make ill-advised cuts
of $21.6 billion from Medicaid and the earned-income tax credit, EITC.
I am already concerned about the reconciliation instructions in the
resolution that would further reduce federal revenues by $80.6 billion
for tax cut extensions that we cannot afford. We have felt in the
current fiscal year the negative effects of these tax cuts on important
domestic programs starved for resources, while we continue to put
essential support toward our operations in Iraq and Afghanistan and the
global war on terror. I strongly support our men and women in the
military who are fighting to preserve our security, and we must not
erode further resources from them or the people they are protecting at
home by extending tax breaks or making them permanent. Although fully
offset relief to lower income families through measures such as the
refundable child credit are seductive assumptions under this
instruction, I understand that further assumptions in the resolution
would allow an earlier repeal of the estate tax in 2009 instead of 2010
and permanency in other areas such as the dividends and capital gains
rate structures at a cost of $22.7 billion. Now is simply not the time
for such measures.
With due respect to my colleagues on the other side of the aisle,
while we are seeing small promising signs in the economy, my colleagues
seem willing to deny the ability of lower income families to help drive
economic recovery by raising their taxes. The resolution would partly
fund tax cut extensions and permanency on the backs of the working poor
with attacks on Medicaid and the earned-income tax credit, EITC. These
are simply mean-spirited actions against working families in this
country.
The budget resolution would increase the number of underinsured and
uninsured in this country by cutting more than $11 billion from
Medicaid. The impact that this would have on already strained state
Medicaid programs and the individuals who rely on this important safety
net would be devastating. States continue to face crisis situations
with respect to their budgets. We all know that Medicaid makes up a
tremendous portion of state budgets, and drastic cuts by states to
balance their budgets have swelled the rolls of those without
insurance. The Center on Budget and Policy Priorities reports that
state cuts over the past 2 years have shut between 1.2 million and 1.6
million people out of the Medicaid Program.
Additionally, the reductions in Medicaid included in the budget
resolution will lead to further cuts in coverage and benefits for
people in need. They will prevent individuals from being able to access
health care, which will increase the burden on our public health
system. The uninsured delay seeking medical treatment, which is likely
to lead to more significant and costly problems later on than if they
had sought earlier, preventative treatment or had access to proper
disease management. These cuts will also further erode the ability of
the hospitals, physicians, and other medical providers in our
communities to meet the health care needs of the community. Our health
care providers who already are confronted with inadequate
reimbursements, rising costs, and an increasing demand to provide care
for the uninsured. A tremendous $11 billion cut would far exacerbate
this problem and perhaps hold tragic consequences for welfare
recipients only beginning to rebuild their way to self-sufficiency.

The resolution before us would also strike $3 billion from the EITC--
a refundable credit that helps lower income individuals and families to
meet essential needs--food, clothing, housing, transportation, and
education. The Census Bureau notes that the credit lifted nearly 4
million people above the poverty line in 2001. This year, families can
expect an average refund of $2,067, which can mean a stay of eviction,
transportation to a decent paying job for the year, or food in
children's bellies. The EITC can mean the equivalent of a $2 an hour
raise in the salary for working mothers and fathers.
I would like to present a visual image of just which families are
reached by the EITC. As you can see in the chart behind me, courtesy of
the Brookings Institution, higher concentrations of EITC recipients are
in the dark orange at more than 40 percent, with the percentage
decreasing as the colors move to yellow, then blue. We can see how
effectively the EITC reaches families and communities in large cities
and all across the rural South. Highest concentrations of EITC
recipients as a percentage of total filers in a state can be found in
Alabama, Arkansas, Georgia, Louisiana, Mississippi, New Mexico, South
Carolina, and Texas.
Finally, an analysis of delegations by state clearly shows that the
EITC should remain a bipartisan issue. The 18 States that have two
Senators from my side of the aisle have 15.2 percent of all EITC
earners, while the 19 States with two Senators from the other side of
the aisle have an even greater percentage of recipients at 17.2 percent
of all EITC filers. All total, EITC assistance of almost $36 billion is
lifting our communities representing meaningful relief for millions of
EITC earners, whose numbers grew by 8 percent between tax years 2000
and 2002 due to the economic downturn and longer-term unemployment
trends.
Mr. President, in closing, we should not be attempting to produce
savings for ill-timed tax cuts by denying such assistance to those in
our states who most need it. Without the Medicaid program and the EITC,
many families will go without health services and fundamental, everyday
priorities. The Baucus amendment seeks to ensure that the working poor
will have access to the healthcare that they and their children need,
and the financial assistance that will provide for their essential
expenses.
I have sent to my colleagues in the Senate a copy of the statement of
the low-wage workers. I have also sent a ``Dear Colleague'' letter to
each office on the earned-income tax credit map we have shown.
I hope all of my colleagues will look at the EITC predicament and
support the Baucus amendment.
I yield the floor.
The PRESIDING OFFICER. Who yields time?
The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I yield myself such time as I might
consume.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRASSLEY. Mr. President, during this debate on this amendment, we
have heard there is going to be $11 billion cut from various programs
under the jurisdiction of the Senate Finance Committee. I have the
budget resolution in front of me. I defy anybody to tell me where in
this budget resolution there is an $11 billion cut.
I want to make it clear. What has been said, thus far, is based on
some assumptions, assumptions that, in the global view of all the
possible assumptions that the Senate Finance Committee could draw on to
save a little

[[Page S2522]]

bit of money, it is in the realm of possibility, but it is a very
extreme possibility of just exactly where the Senate Finance Committee
ends up to save $3.4 billion, not $11 billion. This comes from the fact
the budget includes an instruction to the Finance Committee to
reconcile $3.4 billion over 5 years.
Now, if you were talking on ``Main Street'' in Waterloo, IA, about
saving $3.4 billion over 5 years, out of the trillions of dollars that
the Federal Government is going to spend over that period of 5 years,
and you wanted to explain to somebody that you could not save a
fraction of 1 percentage point, they would say: You better get some
businessperson to serve in the U.S. Senate because the average
businessperson has to deal with problems like that all the time. It is
a small amount of money, but it is still some direction given to the
committee.
Now, exactly where we might do that--there has been a lot said
tonight, that somehow people know exactly where the Senate Finance
Committee is going to get this sort of reconciled figure. I would have
to say, I do not know yet. I do not know yet because I have not looked
at all the possibilities. I do not know yet for a second reason: that
even if I had a very good idea of exactly where this ought to come
from, a chairman of a committee, particularly of the Senate Budget
Committee, does not run the Finance Committee. We do things in a
bipartisan fashion in that committee. Even within the Democrats, there
is a difference of opinion, not a unified position among Democrats and,
for sure, among my Republican members of the committee there is not a
unified position.
It takes a lot of compromise to do anything in the Finance Committee.
When you are talking about even saving a fraction of 1 percent--a very
small fraction of 1 percent--let me tell you, there would still be a
great deal of difference of opinion that it ought to be done. The fact
is, there is nothing in this budget resolution that says where we have
to save that money. That is our committee's decision.
When you vote this week on this budget resolution or when you vote on
this amendment, I want to make it very clear to you that there is
nothing in this that says how this money ought to be saved. So I can
say to any of my colleagues on the other side of the aisle: I do not
want this program cut. Another one says: I do not want that program
cut. I can say: There is nothing in this resolution that says I have to
cut program ``ABC'' or ``DEF.'' It is what we can do in our committee.
For sure, there has been a great deal of talk about it might come out
of Medicaid or it might come out of the earned-income tax credit. Maybe
it could, to some extent. But I do not know that yet. Even if I knew
it, I could not produce 11 votes this minute, and that is the way it
ought to be. This has to be a thoughtful process.
All we are doing in this budget resolution is making an overview of
the fiscal policy of the Congress for the next 12 months. That is all
we are doing. We are doing that so all the committees of Congress are
disciplined. Before the budget resolution, when it came to fiscal
matters, every committee and subcommittee in Congress was a kingdom
unto itself. And what was the fiscal policy of the Congress of the
United States? It was the total action of all the separate committees.
But the Budget Committee is set up so that before you spend money,
before you make tax policy, you have a well-thought-out process of
keeping within certain limits so that each committee is not a kingdom
unto itself, but they are disciplined by the total view expressed in
the Congress in a budget resolution--in the Senate and House
separately; and then, after compromise between the two Houses, that
policy is adopted.
Now, the budget assumes additional savings, but the Finance Committee
is not required to reconcile these savings. Striking the $3.4 billion
reconciliation instruction does not remove these other nonbinding
savings. These nonbinding assumptions would remain. This amendment does
not change any--does not change any--of those assumptions.
The amendment deals with $3.4 billion, but all the debate has been
about certain assumptions, and there is nothing in the amendment that
changes any of those assumptions. So what all the debate has been about
is not what you are going to be voting on. You are going to be voting
on $3.4 billion being saved. But the debate has been about, ``Oh, the
money is going to come out of Medicaid; the money is going to come out
of the earned-income tax credit'' because of some assumptions that were
made. But the assumptions are not binding. The amendment before us does
not even change the assumptions.
As to the point that the House-passed reconciliation bill could be
handled in the Senate under what we call the rule XIV procedure--which
is a way of bypassing the Finance Committee--the Congressional Budget
Act clearly states that only a bill reported by the Finance Committee
is entitled to the reconciliation protections. So you cannot bring
something over from the House under rule XIV and have it reconciled.
Our committee, and only our committee, has the responsibility to deal
with this for the Senate.
Now, speaking to a specific program, I would address the issue that
has come up about Medicaid. As chairman of the Senate Finance
Committee--we have jurisdiction over the entire Medicaid Program--I am
not bound by those budgetary assumptions. That is the third time I have
said it. I hope it is clear. The chairman of the Senate Budget
Committee and the Budget Committee can put certain assumptions in the
resolution, and those are legitimate assumptions to put in the report,
although we do not vote on those assumptions. But they are assumptions
because it is legitimate for those of us in the Congress to expect the
Budget Committee to be responsible. If you are going to put down a
figure, you ought to have something to back it up. It should not be
pulled out of the clear blue sky. It ought to be based on certain
assumptions. That is what the Budget Committee and the chairman did,
and that is what they should be doing. Now, I am not bound by those. I
have respect for those, though, I want to point out, as I have respect
for the work of the Budget Committee and its chairman. But I don't have
to share the assumptions that any Budget Committee makes on how to
arrive at the figure. In this particular instance, I might have
different views about Medicaid. Frankly, I do. But that is not the
issue of debate.

I happen to believe Medicaid is a vital safety net program for our
most vulnerable citizens. It is for people who are low income. It is
for pregnant women. It is for the elderly, for the disabled, and for
others. States also spend a significant amount of their budgets on
Medicaid. When I look at a program, how we save Medicaid money, if we
go there--and we are going to have a responsibility to look at all this
stuff; we might not even look at Medicaid at all, but we might--I have
to be mindful of any effective changes we make to the Medicaid Program
that it might have on the States, because this is a program where there
is a partnership between the Federal Government and State governments
and, in some States, even local governments.
Last year, for instance, this entire Congress felt very serious about
doing something to help States, in addition to what we would do through
Federal grants to the States, emergency grants, because most of the
States had very tight budget situations. We gave $20 billion relief to
States, of which $10 billion was just for Medicaid. I say that not that
you need to be reminded of it, but I want you to know our committee,
even 8 months ago, took into consideration the needs of the States.
I am going to look at how Federal tax dollars are spent, but I also
have to know there is some impact they have on the States.
We also have to look at the reality of every Federal program. They
ought to be reviewed from time to time. It seems to me we can look at
Medicaid not as some sacred cow. Not that it is not a good program, not
that it should not be preserved. It is part of the social safety net of
our society. It will be maintained. It is a program that is 38 years
old. But it is only an extension of a 200-year history our society has
had of taking care of the most vulnerable, originally, entirely by
counties or local governments. Then the States got involved, and then,
in the 1940s, the Federal Government got involved in several ways. Then
that was all kind of put together in the 1960s in the Medicaid Program.
There is no reason to think this is some sort of a flawless program
that

[[Page S2523]]

can't be made a better program. You don't even have to assume it is
some program that at least a fraction of 1 percent maybe can't be saved
to some extent. No conclusions on my part, but I wouldn't be a very
good public official, a very good trustee of the taxpayers' money if I
thought any program couldn't be looked at to see could we save a half
of 1 percent out of that program.
I am not opposed to reviewing whether there are instances of fraud or
abuse in the Medicaid Program, but I want you to know that I will
conduct oversight activities and do it in the open. I will do it in a
bipartisan manner. I am going to do it with extensive input from
stakeholders.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I thank my colleague, Senator Grassley,
chairman of the Finance Committee, for his statement. He happens to be
exactly right. The net essence of this reconciliation instruction is to
tell the Finance Committee, save $3.4 billion over the next 5 years.
The Finance Committee is an enormous committee. It has jurisdiction
over welfare, Medicare, Medicaid, Social Security, a total of about
$4.6 trillion over the next 5 years. Surely this committee can find
$3.4 billion of waste, of money that should not be spent.
Senator Byrd alluded to the reconciliation process and said it is
supposed to be used to save money, to reduce the deficit. We gave an
instruction to the Finance Committee to do that. Can't we save at least
$3.5 billion out of $4.6 trillion?
I have heard people say: It is going to mean some cuts in Medicaid.
Medicaid has a lot of fraud. I tell my colleagues and my good friend
from North Dakota, I may want to do a hearing in the Budget Committee,
if the Finance Committee is not willing to do it. Let's get into these
intergovernmental transfers. Let's find out about how much some States
are ripping off the Medicaid system. I use that term exactly as I meant
it, ripping off the Medicaid system, ripping off the Federal
Government, taking a program that is supposed to be 50-50 Federal-State
and turning it into a program where the Federal Government pays 100
percent.
There are some proprietors who specialize in how to milk the Federal
Government on Medicaid where the State doesn't even have a match. They
don't have to pay anything. It is all Federal Government. They are
doing that today in a lot of States. Maybe they will pay a little
payment to the hospital if they will participate. There are a lot of
schemes, scams, I think fraud, probably should be totally illegal, some
of it may be bordering on illegality, to the tune of billions of
dollars. The committee doesn't have to do that. We just said: Look,
can't you find at least $3.5 billion?
We have the appropriators tell us day after day: Wait a minute. We
only appropriate maybe about 30-some percent of the budget. Don't make
us take the full brunt of any savings plan. What about those
entitlements? Year after year people say: We can't do that.
My guess is you could find this amount of savings in a number of
entitlements. The committee has jurisdiction over welfare. Are you
going to tell me there is not welfare abuse; that it couldn't be
tightened up?
One assumption I think we need to look at is the earned-income tax
credit. This is a $36 billion program our Federal Government is writing
a check for every year; in some cases, a lump sum in excess of $4,000
for a family. We find out it has abuse of 27 to 30 percent from fraud
or incorrect payments. We can't tighten that up? I didn't say 5-percent
fraud. I didn't say 10 percent. I said 27 to 32 percent of fraud or
mispayment in the earned-income tax credit program. Surely we can
tighten that up. That program over the next 5 years will be about $170
billion or something. Surely we can find some savings in that program.
Whether you are talking about Medicaid, Medicare--there is fraud in
Medicare. We have had some people put in jail because of fraud in
Medicare. Let's tighten it up. We have deficits. We can't afford to
have fraud. We can't afford to have this kind of cheating system going
on day in and day out. It has happened frequently.
So should we not look at the two-thirds of the budget, two-thirds of
the budget that many people say: That is untouchable; let's not do
anything to Social Security. I don't want Social Security fraud. When
you are spending the kind of money we are, there is some fraud. I think
we should look at every dollar.
The Finance Committee has enormous jurisdiction and is very capably
led by Senator Grassley. He is exactly right: $3.4 billion out of a
total of $4.6 trillion is .0007 percent. It is not one-tenth of 1
percent. It is less than that. It is such a small figure. Yet some
people are acting as if the sky is falling because somebody is afraid
maybe their gravy train of abuse might not be able to continue or
somebody is saying: Wait a minute, we have been doing that for a long
time. I want to make sure I can continue.
I say: What is your program? Let's eliminate some fraud. Let's
eliminate some waste. Let's give the discretion to the Finance
Committee to come up with some savings. Let's curtail the growth of
entitlement programs if they are fraudulent, if they are incorrect.
I have great confidence Senator Grassley and Senator Baucus are not
going to report anything out of the Finance Committee that is not going
to be fair if they are talking about trying to tighten up some of the
abuses in the system.
They are not limited. They are not bound. They are not directed to do
anything except can't you save $3.5 billion over the next 5 years when
we assume spending under the committee's jurisdiction will be $4.6
trillion? Surely that can be done.
Again, appropriators have said: Let's not have us bear the full
brunt. Let's have savings elsewhere in the budget. These are very minor
savings, very doable savings.
I urge my colleagues to vote no on the Baucus amendment.
Mr. KENNEDY. Mr. President, America faces a continuing health care
crisis, and this budget makes it even worse for those on Medicaid. For
years, that State-funded program has provided health insurance coverage
for the poor. Because of the fiscal pressures created by the failed
Bush economic policies, States have already had to drop 1.5 million
people--half of them children--from the Medicaid rolls. Instead of
helping States provide insurance coverage, this budget actually cuts
Medicaid further. That is the wrong policy--and this amendment will
reverse it.
The Bush administration is out of touch with the reality of the
plight of working Americans across the Nation. The unemployment rate
continues high, and no end to this crisis is in sight. In addition to
struggling to pay their rent and buy food for their families, millions
of Americans are also having to go without needed health care.
Almost 44 million Americans are uninsured and this number is rising.
Health costs are soaring at double-digit rates each year. As health
insurance premiums continue to soar, employees and employers alike
worry that they will not be able to keep their coverage.
Those without health insurance pay a cruel price. A third of
Americans without insurance say they do without recommended treatment
because they can't afford it. A third report not filling a prescription
because of cost. Almost half report postponing care because of cost.
These facts have real health consequences. According to the Institute
of Medicine, 18,000 Americans die every year, simply because they don't
have health insurance. Thousands more suffer needlessly or acquire
early disabilities.
The Republican budget ignores this crisis, without any credible
proposal to protect the uninsured or reduce the rising cost. Instead,
the Republican budget makes the problem worse, by slashing $11 billion
from Medicaid over the next 5 years.
Medicaid is a lifeline for 50 million Americans who have no other
access to health care. Medicaid provides needed prenatal care to
pregnant women. It means that children receive early and periodic
screening, diagnosis, and treatment. They get immunizations and other
health services. Millions of low-income elderly seniors rely on
Medicaid to pay the health and nursing home costs that Medicare doesn't
cover.

[[Page S2524]]

States are struggling to maintain their share of Medicaid in the face
of severe budget deficits. Last year, States had a combined deficit of
$78 billion, and another $40 billion shortfall is expected this year.
The State Medicaid cuts last year would have been far worse without the
$20 billion State relief passed by Congress to help meet it a year ago.
We should continue that assistance now, not make the problem worse by
slashing benefits to the most vulnerable Americans.
The amendment we are proposing will eliminate the unfair
reconciliation instruction that would force the Finance Committee to
cut $11 billion more from Medicaid. These harsh cuts are opposed by
more than 155 national organizations, including physicians, hospitals,
children, the elderly, women, religious organizations, and professional
associations. The National Governors Association opposes these cuts.
The American Hospital Association opposes these cuts. The American
Medical Association opposes these cuts. The American Health Care
Association opposes these cuts. The Children's Defense Fund opposes
these cuts. The National Organization for Women and Families opposes
these cuts.
The American people understand that these cuts are cruel and
counterproductive. They are the wrong priority for America, and I urge
the Senate to approve this amendment and preserve health care coverage
for millions of Americans.
Mrs. CLINTON. I rise in strong support of the amendment to save
crucial programs like Medicaid from being slashed by this short-sighted
budget.
This is a time when American families are still struggling to find
jobs, and the new jobs they are finding are often low-wage jobs that
lack health insurance. In this setting, Medicaid remains an essential
``safety-net'' in the provision of health and long term care services
for millions of Americans.
Meanwhile, even as need is greater, States' revenues are declining,
so there are fewer and fewer resources to meet those needs. New York
had a $6.8 billion budget gap last year, $11.5 billion in '03/'04--
that's 25 percent of the general fund. This is a pattern repeated for
all the states. Texas had a 15 percent shortfall. Alabama faced a
shortage amounting to 16.5 percent of the general fund. And because
States, unlike the Federal Government, often face State constitutional
provisions that prevent them from carrying a deficit, they are forced
to cut benefits to make ends meet, thus slashing eligibility, starving
hospitals and physicians, and slashing services. We see that happening
all over the country.
But instead of acting to prevent these cuts, and stanch the bleeding,
this budget turns the knife further and forces $11 billion in
unspecified cuts to Medicaid at a time when such cuts would cripple
states' ability to serve American families in hard times.
We have all been on record supporting the important safety net role
that Medicaid plays when American families are hard-pressed to find
jobs. Last year, we worked hard to recognize the existing financial
instability threatening the Medicaid program. We provided $10 billion
in temporary State fiscal relief directed at Medicaid. Thanks to this
relief, States and local communities have been able to continue to
maintain their Medicaid programs and avert drastic cuts in local
services. But the fiscal relief is due to expire in 3 months, even as
State budget situations remain in critical condition. And as the jobs
situation continues to look dire, Medicaid is as critical as ever to
ensuring the health of millions of Americans. Now is not the time to
make additional reductions in federal Medicaid funding.
We must reject the Medicaid reduction provisions in the budget and,
in doing so, take a stand to protect the health and long term care
needs of our nation's struggling families, our elderly and disabled.
That is why I urge my colleagues to support the Baucus amendment to
reduce the amount of cuts that would otherwise have to come from
Medicaid.
Mr. CONRAD. Mr. President, I am wondering at this point if we can
reach an agreement on the additional time on this amendment. Senator
Baucus tells me he only requires 5 more minutes.
Mr. NICKLES. Mr. President, I ask unanimous consent there be 5
minutes on each side remaining on the Baucus amendment.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
Mr. BAUCUS. Mr. President, I want to address a couple of points that
I think need to be addressed. They are a bit misleading. First, there
is no language in the budget that specifically requires the Medicaid
cuts. So why pass this? The fact is, with all due respect to the
chairman of the Budget Committee, during markup the chairman said
basically that we assumed the $11 billion in mandatory cuts was going
to come from Medicaid. That is the chairman's assumption. He made that
very clear. He wants it to come out of Medicaid.
As we know around here, that is the general thrust of measures we
pass that are in the budget resolution, and that is what is going to
happen. As long as I have been here, and I have been here a long time,
that is the way this place operates.
There are clearly going to be cuts there. So the point that cuts in
Medicaid are specifically required, that is not true. Are they
effectively required? Clearly, yes. Also, it has been suggested there
is a lot of fraud, waste, and abuse. That is a bit of a disingenuous
statement. First, we never condone fraud and abuse. We don't need a
statute to allow that. There are anti-fraud and anti-abuse laws. There
are no specific fraud and abuse proposals. It just says cut.
If there is no proposal, as I said earlier, Joint Tax has not scored
anything that amounts to raising revenue. By logical conclusion, we are
going to cut Medicaid; it is that simple. It sounds good, this fraud,
waste, and abuse, but it is just going to be a straight cut. There is
no specific proposal that addresses that.
Also, we are already so-called cutting waste. There is a $2 billion
savings, a cut in error rates, because the administration is looking at
this more closely, which is good. There are a lot of error rates
elsewhere in the code, not just for low-income people. It is in sole
proprietorships and other categories of taxpayers as well. We are not
cracking down on them; we are cracking down on poor people. That is the
wrong thing to do.
The main point is this is a cut in Medicaid. That is clearly what is
intended. Second, this is not a fraud, waste, and abuse cleanup; it is
a cut in Medicaid. Be honest. That is the effective result.
Technically--it is a small point--some of the concern about error
rates in Medicaid is because States controlling the Medicaid Programs
are undertaking actions that are now being corrected by Uncle Sam. So
it is not the fault of the low-income folks. It is not the earned-
income tax credit or the refundability portion. That is a small part of
the problem. Rather, it just changes the administration of it between
Uncle Sam and the States.
This is a good amendment. We should not cut Medicaid. We should not
cut folks who get the advantage of the marriage penalty by $21.6
billion. That is the effect of the cut that is going to be required in
the budget resolution.
My amendment says, let's eliminate that requirement and deal with
Medicaid and other programs as we normally do in the normal course of
business.
I yield back the remainder of my time.
Mr. NICKLES. Mr. President, I think Senator Grassley said it very
well. He is chairman of the committee. He said the committee can find
$3.4 billion out of $4.6 trillion. I think it could be in Medicaid or
in the earned-income tax credit. I think it could be in almost any
program, such as the welfare program. I have no doubt whatsoever there
is plenty of abuse. The administration talked about the
intergovernmental transfers. There is lots of abuse.
I am going to embarrass our colleagues by getting into this in
detail. I will show people how some States have been ripping off this
system--probably to a much greater extent than even what has been
bantered about. It is happening today. Many States are doing it.
I will tell my colleagues that we found we had payment abuse in
Medicaid in years past. You might remember the program. We had to
tighten it up. There has been some tightening of

[[Page S2525]]

the intergovernmental transfer but not very much. A lot more could be
done.
The Federal Government should not be taking Medicaid dollars and
giving it to States to pave roads. In some cases, Medicaid money is
being used by States for a lot of things other than Medicaid. I am
telling you, I come to this Senate with, I hope, a little bit of
credibility. I am not making this up. Maybe a more thorough evaluation
in the committees would expose some of this. The earned-income tax
program, people don't want to touch it. Yet the GAO says there is an
error rate, a fraud rate in 27 to 30 percent, or a 32-percent fraud in
a program that spends $36 billion a year, and we cannot direct the
committee to say, Can you not come up with some savings? I am
embarrassed.
If we are not going to stay let's at least do some shaving of the
growth of some of the fraud in the entitlement programs, two-thirds of
the Federal Government or of the budget, if we cannot shave a little
spending in this area, shame on us.
For the people who act as if I am a deficit hawk, I want to get the
deficit down. The last time we had significant instruction to reduce
the growth of some of these entitlements to take out some abuse was in
1997. Some of my colleagues say we got the deficit down. The biggest
spending reduction thing we did--maybe one was shutting down the
Government in 1995 for a while, but the biggest thing was in the 1997
bill that had reconciliation instructions, had significant savings. A
lot of the people taking credit for the great savings we did in the
nineties didn't vote for that.
Anyway, to ask this committee to find $3.4 billion out of $4.6
trillion over the next 5 years is not heavy lifting, as Senator
Grassley alluded to. I agree with him entirely. I think the committee
can find this much and more. I urge our colleagues to, at the
appropriate time, vote no on the Baucus amendment.
The PRESIDING OFFICER. The Senator from North Dakota is recognized.
Mr. CONRAD. Mr. President, my understanding of the Baucus amendment
is that he has not taken out the savings at all. All he does is take
out the reconciliation instruction. The savings are still there.
Let me comment for a moment, if I can, on what Chairman Nickles is
saying, because he is talking about something where I entirely agree
with him.
In Medicaid, there are States that are engaged in scams. I don't know
how else to say it. What Chairman Nickles has said is entirely
accurate. There are States that have figured out ways of tapping into
the Federal Treasury and replacing what should be State funds with
Federal funds. There is nobody who studies this who doesn't know what
the chairman has said is true.
There are a number of States that have almost made a science out of
playing games with Federal programs, to tap into the Federal Treasury,
to advantage their States to the disadvantage of Federal taxpayers and
to the disadvantage of other States.
But I repeat, in looking at the amendment of Senator Baucus, he has
not taken out those savings. Those savings remain in the underlying
resolution. It does take out the reconciliation instruction. So I have
concluded that the Baucus amendment is worthy of support.
What the chairman has said is something I join in, especially with
respect to Medicaid Program abuses. I am very hopeful we will have a
hearing on these issues once we get past the budget resolution and the
negotiations in which the chairman will have to be involved in the
coming days. We ought to put a bright light on some of these States
that are engaged in a scam operation.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, we yield back the remainder of our time.
I believe the Senator from Ohio has an amendment. He has requested 25
minutes on his side. I know a couple of other colleagues have
amendments. We told people to expect votes at 9 o'clock. I would like
to get in three or four amendments, if possible. I call upon our
colleague from Ohio.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, maybe we can lock in an agreement. Is
there any way the Senator from Ohio would take 20 minutes on his side,
and we will take 20 minutes on this side? I would even take 15 minutes
on this side if the Senator would reduce his time to 20 minutes. That
will give us a chance to offer another amendment or two before the
voting starts.
Mr. VOINOVICH. Mr. President, I think I need 25 minutes, but it may
be 20. I think I need 25 minutes.
Mr. NICKLES. I ask unanimous consent that the Senator from Ohio be
recognized for his amendment not to exceed 25 minutes, and the Senator
from North Dakota be recognized for 20 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Ohio.

Amendment No. 2705

Mr. VOINOVICH. Mr. President, I call up amendment No. 2705 and ask
for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Ohio [Mr. Voinovich] proposes an amendment
numbered 2705.

Mr. VOINOVICH. Mr. President, I ask unanimous consent that the
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To balance the budget and lock away the Social Security
surplus by establishing a supermajority point of order prohibiting the
consideration of any bill that raids the Social Security Trust Fund by
exceeding a declining level of on-budget deficits on a fiscal year
basis)

At the appropriate place, insert the following:

SEC.   . BALANCED BUDGET POINT OF ORDER.

(a) In General.--Except as provided in subsection (b), it
shall not be in order in the Senate to consider any bill or
resolution (or any amendment, motion, or conference report on
that bill or resolution) that would result in an on budget
deficit larger than--
(1) in fiscal year 2004, $639,000,000,000;
(2) in fiscal year 2005, $575,000,000,000;
(3) in fiscal year 2006, $511,000,000,000;
(4) in fiscal year 2007, $447,000,000,000;
(5) in fiscal year 2008, $383,000,000,000;
(6) in fiscal year 2009, $319,000,000,000;
(7) in fiscal year 2010, $255,000,000,000;
(8) in fiscal year 2011, $191,000,000,000;
(9) in fiscal year 2012, $127,000,000,000;
(10) in fiscal year 2013, $63,000,000,000; and
(11) in fiscal year 2015, $0.
(b) Exception.--Subsection (a) shall not apply if--(1) the
President has declared a state of national emergency; or (2)
the economy is in recession, defined as 3 consecutive
quarters of negative growth in Gross Domestic Product.
(c) Supermajority.--(1) Waiver.--This section may be waived
or suspended in the Senate only by the affirmative vote of
three-fifths of the Members, duly chosen and sworn.
(2) Appeals.--Appeals in the Senate from the decisions of
the Chair relating to any provision of this section shall be
limited to 1 hour, to be equally divided between, and
controlled by, the appellant and the manager of the bill or
joint resolution, as the case may be. An affirmative vote of
three-fifths of the Members of the Senate, duly chosen and
sworn, shall be required in the Senate to sustain an appeal
of the ruling of the Chair on a point of order raised under
this section.
(d) Exercise of Rulemaking Powers.--Congress adopts the
provisions of this section--(1) as an exercise of the
rulemaking power of the Senate and the House of
Representatives, respectively, and as such they shall be
considered as part of the rules of each house, or of that
house to which they specifically apply, and such rules shall
supersede other rules only to the extent that they are
inconsistent therewith; and (2) with full recognition of the
constitutional right of either house to change those rules
(so far as they relate to that house) at any time, in the
same manner, and to the same extent as in the case of any
other rule of that house.

Mr. VOINOVICH. Mr. President, before I speak in regard to this
amendment, I would like to comment on the discussion that was going on
with regard to Medicaid. There is no question that as a former Governor
I observed my colleagues around the country gaming the system, and I
was very upset about it. I made it very clear as chairman of the
National Governors Association that this was an understanding we had
with the Federal Government and that we ought not to game the system.
I will never forget while I was Governor there was a management
company, which is no longer in business, that went out to the school
districts and showed them how they could use the money they were
spending for

[[Page S2526]]

health care and use it to game the Medicaid system. They would charge a
percentage of the money they were able to bring into the school
district. When I found out about it, I went beserk, to put it as nicely
as I can, and that stopped. But I do think it is not a sacred cow that
ought not be looked at. Just like a lot of mandatory spending we have,
it should be reviewed to see if there are ways we can save some money.
Mr. President, I support this budget resolution, and I applaud
Senator Nickles for his diligence and fiscal responsibility. The budget
resolution we are considering builds on the success of the resolution
Senator Nickles crafted last year. The fiscal year 2004 budget
resolution reestablished fiscal discipline and provided reconciliation
instructions for a stimulus package that generated 4-percent economic
growth in 2003.
The fiscal year 2004 budget resolution also balanced fiscal
discipline with a very real need to stimulate the economy. Although the
economy started to grow after the 2001 tax reforms, the growth was very
sluggish and did not create many jobs. Real growth in GDP was 2.9
percent in 2001 and 2.8 percent in 2002.
Consequently, the fiscal year 2004 budget resolution included
reconciliation instructions for a modest, highly targeted economic
stimulus package that Congress adopted in May of last year--a $350
billion stimulus package. By the end of the year, economic growth
reached 4.4 percent, and unemployment had finally fallen below 6
percent. Most experts expect the economy to grow by more than 4 percent
this year and for unemployment to continue to fall.
Unfortunately, my own State of Ohio has not participated as fully in
the recovery as some of the other States. We need to continue the
stimulus measures to make sure Ohio's economy takes off. We have too
many people out of work in my State. We have too many people who are
concerned about whether or not they are going to have a job. I agree
with the President that we should not rest until every American who
wants a job has one.
Congress also provided direct assistance to working families last
year when we accelerated the phase-in of the child tax credit,
eliminated the marriage penalty, and expanded the number of families
paying income taxes at the lowest rate of 10 percent. I supported these
tax reform provisions when they were enacted last year and even joined
with Senator Snowe and Senator Lincoln to encourage the Finance
Committee to expand refundability of the child tax credit for families
with incomes between $10,500 and $25,000 per year.
For many families in Ohio, these tax reform provisions meant they
could buy presents for Christmas as well as food. For some, it meant
they could pay the heating bill. All families benefited from these
reforms, and I am proud we supported them.

Fortunately, Senator Nickles has again crafted a budget resolution
that balances fiscal discipline with the need to continue assisting
low-income families. The Budget Committee makes hard decisions by
assuming a freeze for most spending programs at 2004 spending levels,
with increases for high-priority programs and reductions for low-
priority, one-time, or expired programs. Nevertheless, the committee
recognizes fiscal reality and provides a contingency fund of up to $30
billion for 2005 to fund ongoing military operations in Iraq and
Afghanistan. Also, at long last, the Budget Committee addresses runaway
increases in mandatory spending and proposes a $4.6 billion net
reduction in mandatory spending programs over 5 years.
The fiscal year 2005 budget resolution also assumes Congress will act
to close tax loopholes identified by the President and by the tax-
writing committees. The committee builds upon the budget discipline
included in last year's budget resolution by establishing enforceable
caps on discretionary spending for 2005 and 2006.
The spending caps are set at levels consistent with the discretionary
spending assumptions and are enforced with a 60-vote point of order.
The Budget Committee continues a 60-vote point of order against
advanced appropriations that exceed current levels.
These budget enforcements proved very important last year. There were
67 attempts to increase spending by waiving the Budget Act, and we
successfully fought back 64 of them and saved this country billions of
dollars of additional spending.
Finally, the budget resolution assumes continued budget enforcement
under existing mechanisms for nondefense emergency spending and pay-as-
you-go. In other words, if you want to spend the money, you find
offsets or you find revenues that you can increase to pay for them.
Equally important, the resolution before us today includes tax policy
assumptions focused on preventing economically damaging tax increases
on working families.
The budget resolution proposes to extend the personal tax relief
currently scheduled to expire at the end of 2004, including the $1,000-
per-child tax credit, the 10-percent income tax bracket expansion, and
marriage penalty relief. The budget resolution assumes a revenue loss
of $80.6 billion from 2005 to 2009 for these proposals and directs the
Senate Finance Committee to produce a reconciliation bill to facilitate
their enactment.
Let's put that $80.6 billion in context. I remind my colleagues that
in one fell swoop, we spent $87 billion to provide funding for the war
in Afghanistan and Iraq. That just gives us a figure. That is $87
billion in 1 year, and we are talking about $80.6 billion over a 5-year
period.
These provisions directly impact almost 90 million taxpayers
nationwide, and about 4 million of them in my State. If they are not
extended, a low-income family of four making $40,000 a year will go
from receiving a small refund of $30 to paying the IRS an additional
$800. Frankly, these families simply do not have the extra $800 to send
to Washington at this time. So it is critical that we continue
assisting them until the job market catches up with the growth in the
economy.
I fought very hard for the refundable child tax credit in the 2001
tax reform, addressing the marriage penalty problem that discouraged
many people from getting married because they paid higher taxes if they
got married, and moving the people in the 15-percent bracket down to 10
percent.
When we enacted tax reforms to provide assistance to working
families, I fully supported the sunset provisions that would allow
those provisions to expire when they were no longer needed.
Unfortunately, while the economic situation has improved, we are not
out of the woods yet. In Ohio, over 96,000 initial claims for
unemployment compensation were filed in January. That is why I voted to
extend unemployment benefits and that is why I think this Senate should
vote in the next several weeks to extend unemployment benefits.
Although this number is more than 5 percent lower than last year, it
still represents real families who have lost their principal source of
income. Also, many families and individuals who regained employment
over the past 6 months must still pay off loans to make up late
payments they missed while they were unemployed.
It is time for Congress and the Nation to acknowledge the size of the
problem we face. The Federal Government has a serious debt of almost $7
trillion, annual unified deficits of $477 billion, and net interest
payments that consume 7.5 percent of the Federal budget.
If we see interest rates start to go up in the next couple of years,
that 7.5 percent number could go up to 13 or 14 percent because that is
what it was in 1999 when I came to the Senate.
Under current policy assumptions outlined in OMB's budget
projections, the Federal debt will exceed $9.3 trillion by 2008 and net
interest payments will claim 9.5 percent of our budget. If the private
sector corporations ever issued similar financial projections, their
stock value would plummet. Their credit rating would be discounted to
below junk bond status and no bank on the planet would lend them
additional money. During the savings and loan crisis, the Resolution
Trust Corporation liquidated companies with healthier balance sheets
than the Federal Government can produce today.
Whatever we may desire, until we restore some sort of fiscal
discipline to Federal spending we may not be able to

[[Page S2527]]

afford any new initiatives, no matter how badly they are needed.
More importantly, we are rapidly approaching the time when much of
the debt comes due and we must carefully consider how we will meet this
obligation. Currently, we borrow $160 billion to $175 billion each year
from the Social Security trust fund. As the baby boom generation
retires, this source of borrowing will no longer be available, and
starting in 2017 Social Security will start cashing in the bonds which
make up its assets. If we exercise fiscal discipline now, the Federal
Treasury will be able to redeem those bonds with little or no negative
impact on the rest of the budget or the economy as a whole.
However, if we dig ourselves into deeper debt, we will only be able
to pay our Social Security obligations by raising taxes or with
draconian cuts in other Federal programs.
For almost two decades starting in 1980, fiscal conservatives have
worked hard to return the Federal Government to a balanced budget. For
a short time, after hand-to-hand combat--and I was here for that hand-
to-hand combat--we met our goal for 2 years. In 1999, for the first
time in 30 years, we had a balanced budget, about $1 billion; in 2000,
we had an $87 billion budget surplus. That means we did not use Social
Security to balance our budget.
However, our success in balancing the budget was short-lived. In the
blink of an eye we returned to spending the Social Security surplus
running large budget deficits. Today, instead of reducing our $7
trillion national debt, we are expanding it. Unfortunately, as soon as
we achieved success we reversed course in 1998 and have been increasing
spending ever since. Do we really want to lose 20 years of hard work?
Is it not time we went back to what we were trying to do in 1999 and
2000?

Since 1999, this body has increased Federal spending an average of 7
percent per year. If we maintain this pace, Federal spending will
double every 10 years. Instead of doubling spending, we should be
cutting it. We have consistently skirted the truth about how much we
increase spending and the size of the debt we are incurring.
Advance appropriations and other accounting gimmicks have become
commonplace in our budget process. Thank God these last two budgets
have gotten rid of most of the gimmicks we have had, but most of the
American public does not realize we are spending the Social Security
surplus. So although people may be going around Washington saying next
year's deficit will only be $477 billion, it will really be $639
billion. According to the new CBO projections, we will spend all of the
$162 billion of the Social Security surplus and issue new debt.
Our budget system is broken. Its obvious failure to perform is having
serious consequences on our economy and, by extension, future Federal
revenues, deficits, and debt. That is why I am here to talk about our
Social Security lockbox amendment.
My amendment is simple. It caps the on-budget deficit at the level
projected by CBO for fiscal year 2004, $639 billion, and reduces it by
10 percent each year thereafter. We are going to reduce it over 10
years so at the end of a 10-year period, we will no longer be spending
the Social Security surplus. That means we will really have an on-
budget surplus.
This is a very conservative proposal. It has been 5 years since we
have had an on-budget surplus. This proposal proposes it will be 15
years from 1999-2000 until we get back to where we were at that period
of time.
This proposal has a nice, natural glide. We will go from $639 billion
in 2004 to $575 billion to $511 billion to $447 billion, to $383
billion to $319 billion. For my colleagues' information, the numbers I
have for the next couple of years, 2005 and 2006, are a little bit
above the on-budget numbers the Budget Committee is projecting.
Once we get to the fourth and fifth year, it is lower than the Budget
Committee has projected for that 5-year budget, and then we keep going
down to zero.
I recognize it would be unrealistic to eliminate the ongoing budget
deficit in a single year or even within 5 years. The attempt would
require either draconian spending cuts or job-destroying tax increases.
It contains waivers to recognize national emergencies or a prolonged
recession.
I understand the need for waivers in case of emergencies. This is
hard to believe, but Senator Miller and I drafted a Social Security
lockbox that gained the support of the White House. We worked with them
for 6 months. We were going to announce it 2 days after 9/11. In other
words, we were all set to do it, have a nice press conference, and 9/11
happened. Of course, that changed everything.
Nevertheless, Congress and the President can act now to prevent the
on-budget deficit from getting any larger and initiate a 10-year
glidepath to reduce the on-budget deficit to zero, thereby limiting
transfers from the Social Security trust fund and at the end of the 10
years placing the entire Social Security trust fund in the lockbox.

We need to get this bill passed because today our national debt
stands at $6.2 trillion and until we restore some sort of fiscal
discipline to Congress's spending habits, this number is only going to
keep going up.
It is immoral--it is immoral--to bequeath trillions of dollars in
debt to our children and grandchildren. One of the reasons I came to
this Congress was because I was concerned about my children and my
grandchildren; that we were going to balance the budget, that we were
going to reduce the debt--good, solid Republican principles. We were
there in 1999 and 2000, and then we know what happened. We have to
return to those days.
I know when people come into the office asking for money for
particular projects, I always ask them the same question, and that
question is: Is this particular priority worth putting your children
and grandchildren further into debt? I have done that with several
veterans organizations during the last couple of days. They want
mandatory spending for veterans health care. I pointed out to them how
bad off we are, that we have a war going on and we have to be concerned
about our children and grandchildren, and if we do not do it there will
not be anything around in 10 or 12 years for anyone.
It is remarkable. Their attitudes change. Most of them look at me,
talk about it, and they say, I understand.
The problem today in America is people do not know how bad our debt
is. They still think there is some kind of spigot we can turn on in
Washington and take care of all the problems. It is our obligation to
do something about that. It is our obligation to make sure people
understand how far in debt we are and the tough decisions we are going
to have to make.
I applaud the chairman of the Budget Committee for giving
instructions to the Finance Committee and saying to them, let's find
some reductions in mandatory spending because that is where all the
money is going. The discretionary part of the budget is minuscule
compared to the mandatory spending.
The amendment I offer today is a good start on the difficult path we
must take in order to ensure our economic freedom and security for the
future. I urge my colleagues to consider not only what we propose today
but also to seriously consider what will happen to our Nation's economy
tomorrow if we do nothing.
I ask for the yeas and nays on my amendment, and I yield the floor.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The yeas and nays were ordered.
Mr. CONRAD. Mr. President, the stated purpose of the Voinovich
amendment, to prohibit consideration of any legislation that would raid
the Social Security trust fund, is one with which I strongly agree. It
is a noble purpose. But I am afraid this amendment does not come close
to achieving that purpose. Here is what this amendment does.
We are looking at a comparison between the CBO baseline deficits,
that would be the blue line; the dotted red line would be the Senate
GOP budget plan, the deficits under that plan; the green line would be
under the Voinovich plan. What one sees is the deficits are higher
under the Voinovich plan for the next 3 years than under either the CBO
baseline or under the Senate GOP budget resolution. He is actually
going further into the hole on the promise that 3 years from now, he
will have less of a deficit. He promises

[[Page S2528]]

less of a deficit out in 2008 and 2009. Unfortunately, because of the
way it is constructed, you cannot even be sure you would have less of a
deficit out in 2008 and 2009. What you can be certain of is the
deficits will be higher in 2005, 2006, 2007.
Let me show my colleagues what I am talking about. Comparing to the
CBO baseline, the deficits of the Senator from Ohio would be $78
billion higher in 2005; $121 billion higher in 2006; $57 billion higher
in 2007, with the promise that in 2008, they would be $24 billion lower
and $89 billion lower in 2009. If you add this up, this is $256 billion
more deficit here and $113 billion less deficit there. That is more
deficits, not less. That is more.
I don't know what kind of a plan this is to save anything. It
certainly doesn't save Social Security. It digs the hole deeper. I
don't know what the intention was, but I did read what the effect is.
Compared to the budget resolution before us, the amendment of the
Senator from Ohio would increase the deficit by $63 billion this year,
$66 billion in 2006, and $16 billion in 2007. That is a $145 billion
increase in the deficit over the next 3 years, on the promise that it
is going to reduce it compared to the chairman's mark by $180 billion
in 2008 and 2009. But because of technically the way it is drafted, you
have absolutely no assurance it is going to save on the deficit out in
2008 and 2009 either. All I can say is the words are good, the
sentiment is good, but the proposal goes in exactly the wrong
direction. It increases the deficits, it increases the debt. It makes
no sense to this Senator.
Mr. VOINOVICH. Will the Senator yield for a question?
Mr. CONRAD. I will be happy to yield.
Mr. VOINOVICH. I think perhaps the Senator is misinterpreting the
amendment. Fundamentally what this says is we are going to use these
numbers to get down, in 10 years, to an on-budget surplus like we had
in 1999 and 2000. You are right, the amount of reduction in this
amendment allows for a higher debt, but the fact is, all this says is
you can raise a point of order if it exceeds this amount. I am not
suggesting we reach this amount. All I am saying is, understanding the
way things work around this Senate as I have observed during the last 5
years, we just go straight down and we have this opportunity to raise a
point of order if the amount of money exceeds the numbers we have in
our proposed amendment.
It is a very simple way of achieving what my colleagues on the other
side of the aisle have talked about for a great period of time. The
purpose of it is to allow us to raise a point of order. It takes 60
votes to waive that point of order in terms of spending.
Mr. CONRAD. Mr. President, if I could say this to the Senator, the
problem I think he has with his amendment is he has assumed the CBO
baseline unadjusted. I know this sounds like inside-the-beltway
gobbledygook, but let me say this to the Senator. There was a
supplemental appropriations bill approved last year of $86 billion. I
think all my colleagues will remember that. The problem with the
numbers the Senator from Ohio has chosen is he has built that
supplemental appropriations bill--that was a one-time increase of $86
billion--into that baseline figure. He has that $86 billion built in,
going out all the years into the future. As a result, what you wind up
with is much higher deficits than if you used the adjusted baseline the
chairman of the Budget Committee has adopted.
The chairman of the Budget Committee quite wisely and with strong
support from the ranking member adjusted the CBO baseline by taking out
the future years' adoption of the one-time supplemental. The effect of
the Senator's amendment is to create higher deficits--or at least the
potential for higher deficits--in each of the next 3 years by the
amounts that I talked about. These are the amounts: $256 billion over
the baseline that was adopted by the chairman. I say to the Senator, I
think that would just be a profound mistake.
Mr. VOINOVICH. Will the Senator yield for a question?
Mr. CONRAD. I am happy to yield.
Mr. VOINOVICH. I wonder if he had a chance to see the numbers I used
in this amendment?
Mr. CONRAD. Yes.
Mr. VOINOVICH. I think there is no question that in the first 3 years
the number is a little higher than what you projected, assuming this
$86 billion hit we had last year. But the fact is, if you look at the
numbers for 2008 and 2009, the last 2 years of the 5-year budget
resolution, our numbers are below the numbers projected by the Budget
Committee. In effect, in the first 3 years it may be a little higher.
That doesn't mean we are necessarily going to spend that money. But
when we get to the fourth and fifth year, our numbers are below the
numbers projected in the budget.
Mr. CONRAD. I would just say this to the Senator. I have great
respect for the Senator from Ohio. I think he has been one of the most
levelheaded Members here on issues of fiscal discipline. I think this
amendment in technical detail is flawed, and you will increase or give
the potential for substantial increases in the deficit in the first 3
years, compared to the adjusted CBO baseline, a $256 billion increase.
My experience around here is the promise of more deficit reduction in
the fourth and fifth year is a distant hope, and what you presented is
a present threat of substantially increasing the deficit. I think that
will be just most unwise for the body. It is higher than the adjusted
CBO baseline, higher deficits, higher deficits than in the underlying
Senate budget resolution.
I hope my colleagues will resist this amendment.
The PRESIDING OFFICER. The Senator from Ohio.
Mr. VOINOVICH. Mr. President, if we look at the practicality, I just
used these numbers because it was 10 percent a year. But the fact is a
budget point of order will lie against the numbers that you are
projecting in the budget that came out of the Budget Committee. In
other words, if we exceed your numbers, you are saying this number I am
proposing is going to provide we can spend up to that amount of money.
I am saying the number coming out of the Budget Committee creates a
point of order you can't go beyond.
Mr. CONRAD. Mr. President, let me say to the Senator that I know his
intentions are good. I really do. I have great respect for the Senator.
The problem is, technically, with the baseline that has been adopted,
his numbers leave just so much room for additional deficits for these
first 3 years, and I don't think you will ever catch up to it.
Chairman Nickles and I agreed with the Senator totally about
adjusting the baseline so that one-time expenditures didn't get built
into future years' expenditures. Unfortunately, the Senator from Ohio
has taken the unadjusted Congressional Budget Office baseline that has
the one-time expenditures and includes them going forward in each and
every year. That adds hundreds of billions of dollars to expenditures
over the next years of this budget. What you are left with, as I have
described, is higher deficits for the first 3 years, with the promise
that I am afraid will prove ephemeral, that you are going to get lower
deficits in the fourth and fifth year. I don't think that is a trade we
ought to make.
Mr. VOINOVICH. Mr. President, will the Senator yield for a question?
Mr. CONRAD. Yes.
Mr. VOINOVICH. Mr. President, the Senator from North Dakota has been
here longer than I have. He is the ranking member of the Budget
Committee. I have been interested in this budget for a long time, as he
knows. I would like to ask him if we could achieve this in 10 years
through a real on-budget surplus. Most people would say it would be
miraculous. But the point I am making is you could argue about this
number. You can make a big deal out of it in terms of we know we are
going to do this and you are going to raise these issues. But the real
issue is to try to get down to where we were 5 years ago. I can assure
you, for this Congress to achieve this will be something very
significant and cause a great deal of discipline in terms of extending
tax reductions, and so forth.
In effect, in order to get here we are going to have to have some
pay-go restrictions in order to make that happen.
All I am saying is, say what you want about these first couple of
years, down the road the Senate could achieve what I have on this
chart. It would be a wonderful gift to the American people because we
could guarantee to them that

[[Page S2529]]

we are going to have a true on-budget surplus.
Mr. CONRAD. Mr. President, I don't want to prolong this debate. But I
say to the Senator that I think the intention is good. I think the
legal effect of what is before us does not accomplish the Senator's
purpose. In fact, what we would wind up with is room for greater
deficits in the first 3 years, and you would never catch up in the
outyears.
Mr. VOINOVICH. I can't understand that because the numbers provide
for the budget point of order. How can you say, if you have the number,
that you have a budget point of order, that you are not going to
achieve these numbers?
Mr. CONRAD. Because what is critical to having a budget point of
order that is actually effective in reducing deficits and debt in the
future is having a baseline that really gets you the result you want.
Unfortunately, the baseline the Senator has provided will not lead to
the result as depicted on the graph. That is our conclusion.
Mr. VOINOVICH. Mr. President, I would like to reiterate if we were
able to achieve what this graph shows, it would be the greatest gift we
could give to our children and grandchildren because it would mean that
we have been fiscally responsible. The way we are trying to achieve it
is to say we are not going to use the Social Security surplus. When we
were able to get that on-budget surplus in 1999 and 2000, I remember
how we always had to wrestle in order to not use the Social Security
surplus. It was a way that we were able to control spending. That is
exactly what we are trying to do with this amendment.
Mr. NICKLES. Mr. President, I wish to compliment my colleague from
Ohio. I appreciate the amendment. If his amendment had our deficit
projection level for the first few years and then went down to zero, I
would probably support him. I can't support an amendment that would
have higher deficits than what we project in our budget. I have the
greatest respect for my colleague. He is very sincere. He is a deficit
hawk. He is very interested in getting down to zero, as I am.
Mr. VOINOVICH. Mr. President, will the Senator yield for a question?
Mr. NICKLES. I would be happy to yield.
Mr. VOINOVICH. I would be more than happy to take my amendment and
put the numbers of the Senator from North Dakota in for the first 3
years so that it will take care of the problem the Senator made
reference to and handle it that way so it eliminates any allegations
that somehow this amendment is going to allow for increased spending. I
would be more than happy to do that.
Mr. NICKLES. Mr. President, for the information of our colleagues,
momentarily we will be taking up the Nelson amendment. We will have a
very short 10 minutes on each side on that amendment, and I expect we
would have three rollcall votes.
Mr. SARBANES. Mr. President, will the Senator yield for a question?
Mr. NICKLES. I am happy to.
Mr. SARBANES. The Senator mentioned three rollcall votes, and then
stay on the floor for other amendments to be offered.
Mr. NICKLES. I would be happy to do that temporarily for some period
of time. I know Senator Corzine has an amendment. I think he was next
in line to lay one down. I was expecting that would be the first
amendment we would vote on tomorrow. But I will be happy to consider
it. I know the Senator has an amendment that deals with homeland
security. I think Senator Cochran will be debating that issue. I am not
sure he wants to debate it tonight. I would like to get the rollcalls
started pretty quickly so we can get people home by 10 o'clock, or not
too late thereafter.
Tomorrow, for the information of our colleagues, is going to be a
very tough day. We will have a lot of votes tomorrow. I expect we will
have a lot of votes on Friday. I am trying to cooperate to dispose of
as many amendments as possible. I will be happy to work with my
colleague from Maryland to get in his amendment.
I have asked Senator Conrad to line up amendments on his side. I am
trying to line up amendments on my side.
Mr. SARBANES. What problem would it cause if we were to offer the
amendment after the votes and maybe even discuss it for a few minutes?
Mr. NICKLES. I might not have any objection. I would like to ask
Senator Cochran. I just wanted Senator Cochran to be able to respond to
my colleague from Maryland. We may be able to do that. We could
actually set aside the Corzine amendment and discuss the amendment of
the Senator from Maryland. I am willing to consider that.
Mr. VOINOVICH. Mr. President, I understand from talking to the desk
in order to amend my amendment to reflect the numbers that were in the
budget that came out of the Budget Committee, I need consent from my
colleagues. I would like to move to amend and insert the numbers that
were in the budget resolution to eliminate the problem Senator Conrad
has brought to our attention so the numbers would reflect his numbers.
And, I might point out the number in the third and fourth year is below
the number the Senator from North Dakota has in his budget numbers.
Mr. CONRAD. Mr. President, I would be constrained to object. I object
because even with that change, he would still be substantially above
the Congressional Budget Office adjusted baseline. And he is still left
with an utterly unenforceable mechanism. I would be happy to sit down
and talk with the Senator as to why that is the case. We would object.

The PRESIDING OFFICER. The objection is heard.
Who yields time?
Mr. NICKLES. Mr. President, the order we have agreed upon now would
be to recognize the Senator from Florida. I ask unanimous consent there
be 10 minutes on each side on the Senator's amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Florida.

Amendment No. 2745

Mr. NELSON of Florida. I call up amendment numbered 2745.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Florida [Mr. Nelson], for himself, Mr.
Corzine, Ms. Mikulski, Mr. Schumer, and Mr. Nelson of
Nebraska proposes an amendment numbered 2745.

Mr. NELSON of Florida. Mr. President, I ask unanimous consent that
the reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To create a reserve fund to allow for an increase in
Veteran's medical care by $1.8 billion by eliminating abusive tax
loopholes)

On page 3, line 9, increase the amount by $1,620,000,000.
On page 3, line 10, increase the amount by $162,000,000.
On page 3, line 11, increase the amount by $7,000,000.
On page 3, line 12, increase the amount by $2,000,000.
On page 3, line 17, increase the amount by $1,620,000,000.
On page 3, line 18, increase the amount by $162,000,000.
On page 3, line 19, increase the amount by $7,000,000.
On page 3, line 20, increase the amount by $2,000,000.
On page 4, line 20, increase the amount by $1,620,000,000.
On page 4, line 21, increase the amount by $162,000,000.
On page 4, line 22, increase the amount by $7,000,000.
On page 4, line 23, increase the amount by $2,000,000.
On page 5, line 3, decrease the amount by $1,620,000,000.
On page 5, line 4, decrease the amount by $1,782,000,000.
On page 5, line 5, decrease the amount by $1,789,000,000.
On page 5, line 6, decrease the amount by $1,791,000,000.
On page 5, line 7, decrease the amount by $1,791,000,000.
On page 5, line 11, decrease the amount by $1,620,000,000.
On page 5, line 12, decrease the amount by $1,782,000,000.
On page 5, line 13, decrease the amount by $1,789,000,000.
On page 5, line 14, decrease the amount by $1,791,000,000.
On page 5, line 15, decrease the amount by $1,791,000,000.
At the end of Title III, insert the following:

SEC.   . RESERVE FUND FOR VETERANS' MEDICAL CARE.

The Chairman of the Committee on the Budget of the Senate
shall revise the aggregates, functional totals, allocations
to the Committee on Appropriations of the Senate,
discretionary spending limits, and other appropriate levels
and limits in this resolution by up to $1,800,000,000 in
budget authority for fiscal year 2005, and by the amount of
outlays flowing therefrom in 2005 and subsequent years, for a
bill, joint resolution, motion, amendment, or conference
report that

[[Page S2530]]

provides additional fiscal year 2005 discretionary
appropriations, in excess of levels provided in this
resolution, for veterans' medical programs, included in this
resolution for the Department of Veterans Affairs.

Mr. NELSON of Florida. I ask unanimous consent Senators Corzine,
Mikulski, Schumer, and Nelson of Nebraska be added as cosponsors to my
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. NELSON of Florida. Mr. President, we have arrived at the moment
of truth on veterans. Veterans have been all over this Capitol today
pleading their case regarding their health care. There is not one
Member from any one of our 50 states who has not heard from veterans
the tales of woe, the tales of inefficiency, the tales of long waits,
waits as much as 6 months to get an appointment with a VA doctor to get
a prescription.
The way I approached this amendment was to go to the deliberations of
the Senate Veterans' Affairs Committee and to find and be guided by
their bipartisan analysis of the Veterans' Administration budget,
concluding we must add $1.8 billion in order to adequately fund the
health care requirements of veterans.
Listen to the words of the Secretary of Veterans Affairs when he
testified last month to the House Veterans' Affairs Committee.
Secretary Principi said:
I asked for $1.2 billion more than I received.
In other words, even the Secretary of the VA is calling for more
money.
The President's budget makes up the difference for these cuts in
trying to rely on copayments from veterans on enrollment fees. To pay,
the administration has tried to impose this tax--and it is a tax--on
the hard-earned benefits of veterans in the past, but the Congress has
not and is not going to allow it. We simply cannot accept a budget that
includes access fees and higher prescription drug copayments.
What this budget assumes is the number of VA patients requiring
mental health care will decrease next year. If you believe that, you
believe in the tooth fairy because the bipartisan analysis of our own
Veterans' Affairs Committee finds no basis for this assumption and
wholeheartedly rejects the President's $60 million cut in the funding
for mental health care.
To make matters worse on veterans health care, there are 60,000
veterans nationwide who have enrolled in the VA and have waited for 6
months or longer for an appointment. This is according to the Senate
Veterans' Affairs Committee. Failure to provide more funds is going to
result in longer waits and a higher risk to the quality of the care.
Then there are a couple of other complicating factors. If anyone
thinks because we have so many World War II veterans and because of
their age their numbers are declining, think of all the veterans who
were deployed in our Armed Forces serving in Operation Enduring Freedom
and Operation Iraqi Freedom: 287,000 service members have served or are
serving in those missions. The veterans health system has struggled, to
make matters worse, with war-related problems from the first gulf war,
with hundreds of thousands of American soldiers serving on the ground,
while we cannot begin to estimate future demand on the veterans health
system.
Indeed, because of wonderful improvements in the way our military
operates its health care on the battlefield, this present operation in
Iraq has fewer deaths. But because of the nature of the war, there are
many more injuries. At the end of November of last year, a few months
ago, the number of soldiers medically evacuated from Iraq was almost
11,000, both battle and nonbattle related. This means what? It means
our veterans are surviving at higher rates, hallelujah, but they are
going to also, more likely, depend on the VA for future medical care
related to those injuries.

When we look at the President's budget for the Veterans'
Administration, it reflects only a 1.8 percent increase in medical care
funding over last year's appropriation. Overall medical care inflation,
according to the Bureau of Labor Statistics, was 4 percent. So if we
have medical care inflation at 4 percent with the President's budget
only rising at something under 2 percent for veterans medical care
funding, where is that going to leave our veterans? We must recognize
the health care costs are growing more rapidly and reflect this in the
rapid rise in the VA budget.
From where do I get it? I get it from tax loopholes. Since I only
have 10 minutes, I will not give examples of tax loopholes. If anyone
wants these examples, they have been discussed over the course of the
last several days.
It is simple. Take the money, $1.8 billion increase for veterans
medical care, which is woefully, inadequately funded in the President's
budget and you get that out of closing tax loopholes where corporations
are taking advantage of tax provisions that, in essence, allow them to
pay less taxes than are owed. It is a simple tradeoff. That is what I
am proposing.
Why don't we do something for the veterans?
I reserve the remainder of my time.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, to advise our colleagues, it now appears
we will have a vote in a couple of minutes. The first will be a 15-
minute rollcall vote, the second will be a 10-minute rollcall vote. It
appears we will have two rollcall votes tonight. The first will be on
the Baucus amendment dealing with striking the reconciliation
instruction and the second will be an amendment by Senator Nelson.
If my memory serves me correctly, we voted on a similar amendment
yesterday. I wonder how many times we will have to vote on various
issues. This amendment is very similar to the one from yesterday in a
couple of respects. One, it has billions of dollars of tax increase,
has billions of dollars of spending, except the spending is sheltered
into a reserve fund so some people say this gives more money to
veterans medical care, but it does not do that. It does not increase
money to veterans medical care. It creates a fund and maybe that money
would go in there if the Appropriations Committee did such and such.
But you can count on what it does do; it increases taxes.
My colleague has very legitimate concerns--I share some of those
concerns--about veterans health care. Let me mention a couple of facts
on veterans. We are increasing the total amount of money going to
veterans on mandatory and discretionary by 14.5 percent. I believe I
said this yesterday. That is a lot, especially when you consider you
are trying to do a budget that is almost deficit neutral.
We did add $1.4 billion for medical care. I understand people want
more. I know people wanted more even if we did not do anything. No
matter what we put in, they would want more because they think they are
scoring political points.
I will also say we have taken total veterans function 700--mandatory
and discretionary--from $47.5 billion in the year 2001 to $70.4
billion. That is an enormous increase.
I understand the demands. I understand the challenge it is. But I
urge our colleagues to vote no on the amendment.
The PRESIDING OFFICER. The Senator from Florida.
Mr. NELSON of Florida. Mr. President, this amendment is significantly
different from the one defeated yesterday by a very narrow vote. That
one was for a $2.7 billion increase, but it also had a commensurate
like reduction in the deficit, so the total amount taken out of tax
loopholes was $5.4 billion. This amendment has only $1.8 billion taken
out of tax loopholes to give to veterans for their medical care.
What easier tradeoff--we, all the time, have to make tradeoffs around
here--what easier tradeoff is there than to do this on tax loopholes,
for example, that allow a corporation to go out and buy a bridge, turn
around and lease it back to a municipality, and because it technically
owns the bridge, depreciate the value of that bridge? That is a sham
kind of tax loophole, and that is the kind of stuff we can go after to
fund, to stand up and support the men and women in uniform who have
served this country.
I reserve the remainder of my time.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, how much time does the Senator from
Florida have left?
The PRESIDING OFFICER. Twelve seconds.

[[Page S2531]]

Mr. NICKLES. Does the Senator yield his time? I am going to order
some votes.
Mr. NELSON of Florida. Mr. President, I will be happy to yield back
the remainder of my time, urging a vote for the veterans of this
country.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, we are ready to begin voting. We are
going to have two votes tonight.
Mr. President, I yield the floor.

Amendment No. 2705 Withdrawn

Mr. VOINOVICH. Mr. President, I ask unanimous consent to withdraw
amendment No. 2705.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I thank my colleague from Ohio. He is my
very good friend. He makes some excellent points. I compliment him. He
is what I call a deficit hawk, and I compliment him.
I look forward to working with him on a lot of ideas. Some of his
ideas are in this resolution. Some of his ideas for budget reform were
in last year's resolution. I will remind my colleague from Ohio, we
used some of your budget points of order you suggested to me over a
year ago, this year, throughout the year, to save a lot of spending.
I compliment my colleague from Ohio for his work, and I look forward
to continuing to work with him.

Amendment No. 2751

Mr. President, we are now ready to vote, first on the Baucus
amendment. I expect it will be a 15-minute rollcall vote. I do not
expect to let it go much beyond 15 minutes. I ask unanimous consent to
have the second rollcall vote be limited to 10 minutes.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
Mr. NICKLES. Mr. President, I yield back the remainder of our time.
I ask for the yeas and nays on the Baucus amendment.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
Without objection, the question will first occur on the Baucus
amendment.
The question is on agreeing to amendment No. 2751.
The clerk will call the roll.
The legislative clerk called the roll.
Mr. McCONNELL. I announce that the Senator from New Mexico (Mr.
Domenici) is necessarily absent.
Mr. REID. I announce that the Senator from West Virginia (Mr. Byrd),
the Senator from South Dakota (Mr. Johnson), and the Senator from New
Jersey (Mr. Lautenberg) are necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 53, nays 43, as follows:

[Rollcall Vote No. 39 Leg.]

YEAS--53

Akaka
Baucus
Bayh
Biden
Bingaman
Bond
Boxer
Breaux
Cantwell
Carper
Chafee
Clinton
Coleman
Collins
Conrad
Corzine
Daschle
Dayton
DeWine
Dodd
Dorgan
Durbin
Edwards
Feingold
Feinstein
Graham (FL)
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kerry
Kohl
Landrieu
Leahy
Levin
Lieberman
Lincoln
Mikulski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Reed
Reid
Rockefeller
Sarbanes
Schumer
Smith
Snowe
Specter
Stabenow
Wyden

NAYS--43

Alexander
Allard
Allen
Bennett
Brownback
Bunning
Burns
Campbell
Chambliss
Cochran
Cornyn
Craig
Crapo
Dole
Ensign
Enzi
Fitzgerald
Frist
Graham (SC)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Kyl
Lott
Lugar
McCain
McConnell
Miller
Murkowski
Nickles
Roberts
Santorum
Sessions
Shelby
Stevens
Sununu
Talent
Thomas
Voinovich
Warner

NOT VOTING--4

Byrd
Domenici
Johnson
Lautenberg
The amendment (No. 2751) was agreed to.
Mr. STEVENS. I move to reconsider the vote.
Ms. CANTWELL. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, for the information of our colleagues, we
will have one more rollcall vote tonight. That will be on the Nelson
amendment. It is a 10-minute rollcall vote.
I warn my colleagues, we have allowed these last rollcalls to go a
little long. Tomorrow we are going to have a lot of votes. I am going
to yield back a lot of time tonight or tomorrow. So we are going to be
having a lot of votes. We are doing that to try to make this a more
orderly process because we do not want to have a vote-arama that will
go all night long tomorrow.
I will cooperate with my colleague, and I thank Senator Conrad for
his cooperation. I urge my colleagues to expect a long, hard day
tomorrow. I urge my colleagues, when we have debate, to keep the time
limited so we can consider additional amendments and conclude this
resolution by sometime tomorrow night or sometime Friday. But we will
stay here until we complete this resolution.

Vote on Amendment No. 2745

Mr. NICKLES. Mr. President, we are now going to vote on the Nelson
amendment. I urge my colleagues to vote no. I ask for the yeas and nays
on the amendment.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The question is on agreeing to amendment No. 2745. The clerk will
call the roll.
The assistant legislative clerk called the roll.
Mr. McCONNELL. I announce that the Senator from New Mexico (Mr.
Domenici) is necessarily absent.
Mr. REID. I announce that the Senator from West Virginia (Mr. Byrd)
and the Senator from South Dakota (Mr. Johnson) are necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 46, nays 51, as follows:

[Rollcall Vote No. 40 Leg.]

YEAS--46

Akaka
Baucus
Bayh
Biden
Bingaman
Boxer
Breaux
Cantwell
Carper
Clinton
Conrad
Corzine
Daschle
Dayton
Dodd
Dorgan
Durbin
Edwards
Feingold
Feinstein
Graham (FL)
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Mikulski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Reed
Reid
Rockefeller
Sarbanes
Schumer
Stabenow
Wyden

NAYS--51

Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Campbell
Chafee
Chambliss
Cochran
Coleman
Collins
Cornyn
Craig
Crapo
DeWine
Dole
Ensign
Enzi
Fitzgerald
Frist
Graham (SC)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Kyl
Lott
Lugar
McCain
McConnell
Miller
Murkowski
Nickles
Roberts
Santorum
Sessions
Shelby
Smith
Snowe
Specter
Stevens
Sununu
Talent
Thomas
Voinovich
Warner

NOT VOTING--3

Byrd
Domenici
Johnson
The amendment (No. 2745) was rejected.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I move to reconsider the vote, and I move
to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. NICKLES. Mr. President, that is the last vote tonight. I believe
Senator Corzine has an amendment he is going to lay down. We will
possibly discuss it tonight. I believe he wants to discuss it a little
bit, I am not sure. I have to see what the amendment is. I am not sure
what it is.
I don't know if there are any other amendments that will be
introduced tonight. But I want to let all our colleagues know we are
going to be starting pretty early tomorrow, and we will have a lot of
votes. My guesstimate is I will yield back a lot of time so we will be
on amendments tomorrow. We handled a lot of amendments today. I haven't
counted the number. We accepted some, we disposed of some, but

[[Page S2532]]

we are going to have a lot more amendments tomorrow night, and tomorrow
night we are probably going to be working a lot past 10 o'clock. I
regret that. I would love to change the way budgets are done.
I urge our colleagues, not all these amendments have to be offered. I
urge our colleagues if you have amendments, if you can work them out
with Senator Conrad and myself, we are happy to try to do that. That
might save a lot of time. Rollcalls take a lot of time. We still
conduct rollcalls the way it was done 200-some-odd years ago. It takes
a little while, and that is fine. But I encourage our colleagues to
think of the major amendments we really need to vote on, that they feel
compelled to vote on, and we will try to have those together and give
everybody a fair crack at amending this budget resolution.
I hope some of our colleagues, if they have had success in passing an
amendment, maybe they would consider voting for the resolution, not
just trying to tear the resolution down or change it and continue to
oppose it.
Anyway, I urge our colleagues tomorrow to expect a long day with a
lot of votes. Maybe we can conclude tomorrow night. More than likely we
will conclude sometime on Friday.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, I add my voice to the chairman's and
indicate to our colleagues we have now been able to substantially
reduce the list on our side. I report to the chairman a very
substantial reduction. I think we have eliminated, now, more than 50 of
the amendments that have been noticed. But that still leaves us with
over 40.
At three amendments an hour, that would be 13 hours of straight
voting. It is not just going to be straight voting because we still
have time on the resolution. We still have eight or nine amendments
that are going to require more extended time during the day, before we
get to vote-arama.
I think, just eyeballing it, we are probably talking 4 hours before
we get to vote-arama. Then we have at least, as I have indicated, 13
hours of votes after that, if people do not back off and show
restraint.
We have the night. We have the night to think very carefully about
what kind of quality of life we want for ourselves over the next 2
days.
We have had very significant debates, significant amendments. Let's
try to close this out and do it in a way that has the dignity the
Senate should have. Yes, we will have significant additional amendments
and debate, but let's eliminate the duplication and try to have a
reasonable number of amendments so we can be done by a reasonable time
on Friday.
I thank the chairman for working with me as we have to try to move
this process.
I also thank very much Senator Corzine, who is a very valuable member
of the committee, who has been extraordinarily patient. We almost
achieved a unanimous consent that would have allowed his amendment to
be voted on this evening. It did not happen. I thank him personally for
his patience and his graciousness.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. CORZINE. Mr. President, I compliment both the chairman and the
ranking member for their leadership in this debate. I hope people
understand how civil and effective the views in the debate have been
carried forward. They will be pleased to know we have pulled the other
three amendments I submitted.
Mr. CONRAD. I thank my colleague.

Amendment No. 2777

Mr. CORZINE. With that, Mr. President, I send an amendment to the
desk and ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from New Jersey [Mr. Corzine] proposes an
amendment numbered 2777.

Mr. CORZINE. I ask unanimous consent the reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To eliminate tax breaks for those with incomes greater than
$1 million and reserve the savings to prevent future cuts in Social
Security benefits)

On page 3, line 9, increase the amount by $20,000,000,000.
On page 3, line 10, increase the amount by $31,000,000,000.
On page 3, line 11, increase the amount by $34,000,000,000.
On page 3, line 12, increase the amount by $39,000,000,000.
On page 3, line 13, increase the amount by $36,000,000,000.
On page 3, line 17, increase the amount by $20,000,000,000.
On page 3, line 18, increase the amount by $31,000,000,000.
On page 3, line 19, increase the amount by $24,000,000,000.
On page 3, line 20, increase the amount by $39,000,000,000.
On page 3, line 21, increase the amount by $36,000,000,000.
On page 4, line 20, increase the amount by $20,000,000,000.
On page 4, line 21, increase the amount by $31,000,000,000.
On page 4, line 22, increase the amount by $34,000,000,000.
On page 4, line 23, increase the amount by $39,000,000,000.
On page 4, line 24, increase the amount by $36,000,000,000.
On page 5, line 3, decrease the amount by $20,000,000,000.
On page 5, line 4, decrease the amount by $31,000,000,000.
On page 5, line 5, decrease the amount by $34,000,000,000.
On page 5, line 6, decrease the amount by $39,000,000,000.
On page 5, line 7, decrease the amount by $36,000,000,000.
On page 5, line 11, decrease the amount by $20,000,000,000.
On page 5, line 12, decrease the amount by $31,000,000,000.
On page 5, line 13, decrease the amount by $34,000,000,000.
On page 5, line 14, decrease the amount by $39,000,000,000.
On page 5, line 15, decrease the amount by $36,000,000,000.
At the appropriate place, insert the following:
``Sec.   . Reserve Fund To Prevent Cuts in Social Security
Benefits.--If legislation is reported by the Senate Committee
on Finance, or an amendment thereto is offered or a
conference report thereon is submitted that would extend the
solvency of the Social Security Trust Funds and prevent
future cuts in Social Security benefits, the Chairman of the
Senate Committee on the Budget may revise the aggregates,
allocations, and other appropriate levels and limits in this
resolution by not more than $160,000,000,000 to reflect such
legislation.''

Mr. CORZINE. Mr. President, this is an amendment that is very simple
in nature. It calls for the elimination of tax breaks for those with
incomes greater than $1 million, that is less than two-tenths of 1
percent of income-tax payers in the United States with incomes greater
than $1 million, and reserves the savings for the Social Security fund.
I emphasize that is two-tenths of American taxpayers, basically setting
a new bracket, returning it to 39.5 percent for those who have adjusted
gross income over $1 million.
The amendment uses the savings to establish a reserve fund for Social
Security which would be used only to extend the solvency of the Social
Security trust fund and prevent future cuts in Social Security
benefits. It is straightforward.
Social Security represents the best of America's values. It promises
all Americans, if you work hard, pay your taxes, play by the rules, you
can live out your life in dignity. Social Security is not a handout. It
is not welfare. It is an earned benefit. It honors and rewards work, a
basic American value. The promise of Social Security, when you get
right down to it, is a guaranteed promise of retirement security.
Regardless of how long you live, regardless of the rate of inflation,
regardless of the state of the economy or the state of the stock
market, you worked all your life, you contributed to our Nation's
productivity. Social Security promises you will have enough to have
dignity in your senior years.
In fact, the benefits promised by Social Security are quite modest.
The average monthly benefit is about $900; $900 per month for a senior.
I don't think, at least not in New Jersey--that is not exactly
luxurious living that one would be benefiting from, from Social
Security. But it does provide an important safety net.
For nearly one-third of the seniors in retirement, it is at least 90
percent of their income or more--one-third. For another one-third it is
50 percent or more of their retirement security. And for the balance,
it is a major support, that third third; it is a little less than 50
percent but a significant part of their retirement security.

[[Page S2533]]

As a result of Social Security, the poverty rate among seniors today
is less than 10 percent. It is actually about 9 percent. Without the
program, nearly half of all retirees would live below the poverty
level--48 percent is what the calculations would be--which, by the way,
is where seniors were before the institution of Social Security. It has
provided a major support for the quality of life for America's seniors.
We hear a lot of conversation around here about the problems facing
Social Security. Let me first say that talk is way overblown. Even if
Congress does nothing, the Social Security system is secure and solvent
to 2042. After that date, a substantial portion of benefits could
continue--about 75 percent, I guess, according to the actuaries.
That said, we all have a responsibility to address the long-term
solvency problem of Social Security. It is not in crisis, but it needs
to be addressed. It is better to deal with it earlier rather than
later. That is one of the reasons I believe my amendment makes sense.
If we get started on that process now, we can protect seniors as time
goes forward.
The Social Security trust fund faces a long-term shortfall. The last
30 years of the trust fund needs to be addressed. We ought to be
preparing for it. That is what I am trying to talk about.
Given the angst that so many people in the country have with regard
to Social Security, the President proposed a very radical reform
program which we heard about in the State of the Union. It is something
I think we ought to start putting money aside for now to protect our
seniors as we go forward.
The reality is that this budget resolution does nothing to preserve
or save Social Security. That is why I think it is so important that we
address it. This is one of those means to do it.
Actually, this budget resolution in many ways will make the problem
worse. This budget resolution takes every penny out of the Social
Security trust fund and spends it either on funding additional tax cuts
or spending it on other programs, depending on how you look at it. But
the fact is, over the next 10 years we are going to--if we don't
eliminate tax cuts or some portion of it--use $2.5 trillion. That is
the cost of the Bush tax cuts over the next 10 years. That is almost
dollar per dollar what would be coming into the Social Security trust
fund over the period of time ahead. That is what the excess is. Almost
dollar for dollar, we match the funding of those tax cuts and use up
the Social Security trust fund. I don't think that is what the American
people had in mind. I know they don't have in mind running this country
deeper and deeper into debt. In fact, this budget resolution continues
what this Congress and this President have done over recent years,
which is absolute abandonment of fiscal discipline.
For the year 2005, the majority is proposing that the Government run
a deficit of more than $512 billion with this resolution. That is the
full on-budget element, and I think it is very hard to argue it is
fiscally responsible. In fact, I consider that a pretty egregious
figure hardly reflecting the kind of fiscal responsibility we all seem
to hold close to our chests. Even that figure is misleading because it
excludes known costs such as the cost of addressing the alternative
minimum tax beyond 2005; similarly, the cost of our continued presence
in Afghanistan and Iraq after 2005.
By the way, I compliment the chairman and others for putting together
a resolution that actually acknowledges there will be additional
expenditures. But I don't think we have addressed it.
Most importantly, we are not addressing, and there is no allowance
for, the provisions that are embedded in Social Security reform that is
talked about both by the President and many of those on the other side
of the aisle.
Everyone knows that the total cost of the transition to private
accounts, which is so readily embraced by many, will be over $1
trillion and that nothing is allowed in this budget for the beginning
of that transition. I think it is even more aggravated with regard to
where we will end up relative to what the reflected budget deficit is
that is included. I think it will be considerably larger.

We are fooling ourselves if we think that running such deficits comes
without a cost. In the long run, these deficits will have a substantial
impact on our economy and on every American family.
In January of 2001, the Congressional Budget Office projected that by
the end of 10 years we would have $36 billion in publicly held debt.
Instead, today we are looking at a projection of $5.5 trillion by 2008.
It is a rather significant swing in cashflow by this country. It calls
into question whether we are really thinking about the long-run impact
this is going to have on our Nation. Our level of national savings will
go down, interest costs will go up, investment will go down, and the
end result is likely to be a reduced standard of living in the long
term for all Americans.
There is one thing that is absolutely certain in this context, and
that is the certainty that every American will be carrying the debt
burden that goes well beyond where we are today, which is about $24,000
per person and up to about $35,000 just in 2009. I hate to see how this
explodes over the longer period of time because we have all seen the
charts about how deficits grow as the baby boomers retire. We have a
real problem. It is going to undermine the quality and level of
standard of living in America through a period of time.
That is why I believe we need to revisit at least some of the huge
tax breaks enacted in recent years. Over the next 75 years, the cost of
the Bush tax cuts is about $12 trillion in present value terms. By
contrast, the amount needed to ensure the long-term solvency of Social
Security is less than $4 trillion. This is what the tax cuts cost for
75 years. This is how much it costs to fix Social Security, according
to the actuarials. In other words, those tax cuts cost more than three
times the entire Social Security shortfall.
What will happen if we make the tax cuts permanent, as the President
wants? It is a real problem in our capacity to fix this problem; by the
way, Medicare as well. It will lead inevitably to benefit cuts in
Social Security, and more than likely will be dealt with quite deeply.
Many of us, by the way, have thought and long suspected that the
rising deficits of recent years have been no accident but rather part
of a strategy designed to force deep cuts in Social Security and
Medicare to change the basic underlying fix of the social safety net we
have in this country.
Recently, it became a little more clear in a lot of people's minds
exactly what is going on here. No less a figure than the Federal
Reserve Chairman, Alan Greenspan, came out and publicly stated it is
time to do two things: make permanent tax breaks which go largely to
those doing the most well in our society, or make significant cuts--
long run cuts--in Social Security benefits. No doubt many politicians
who believe in such an approach were hoping to defer this debate until
after the election. But I think we need to have that debate out in the
public and fully understood.
I compliment Chairman Greenspan for at least raising this issue so it
is on the table. I don't necessarily agree with the strategy of
execution, of making permanent these tax cuts which undermine our
ability to deal with it, but I think it is absolutely one we need to
debate.
We need to be saving today to make sure we can protect those benefits
for tomorrow. We can't do it if we are going to continue to live with
this absolute binge of tax cuts, especially for the most fortunate. Yet
that is what this resolution proposes. That is why I feel so strongly
we should take steps to try to address something that is so fundamental
to the American people.
My amendment proposes to limit those tax breaks that go to those with
incomes greater than $1 million.
By the way, just returning to the tax bracket at the very high end,
.2 percent of the American taxpayers use those savings to establish a
Social Security reserve fund. The fund would be available only for
legislation to extend the solvency of the Social Security trust fund
and to prevent future benefit cuts. This would not entirely save Social
Security's long-term challenge. Roughly $4 trillion is what we have,
but it is a heck of a downpayment. It is about $1 trillion on the
present value basis in the direction of a big step towards trying to
preserve and make sure we can deal with the Social Security shortfall
over a period of time.

[[Page S2534]]

Again, let me recap why this amendment is so important. Social
Security is a promise we must keep. It is a promise millions of hard-
working Americans will depend on to keep them out of poverty in their
old age. Keeping that promise in the future will require increasing our
savings now. That is why we cannot afford to build massive deficits
with huge new tax breaks for the most fortunate Americans among us.
We need to be disciplined. We need to be responsible. This amendment
says instead of going deeper and deeper into debt, let's save a portion
for the future. Let's hold off on tax breaks for those with incomes
greater than $1 million so we can keep our promise to Social Security
and prevent future benefit cuts for our seniors as the years go on.
That is the right thing to do. It is the responsible thing to do. I
hope the majority of my colleagues will support the amendment.
The PRESIDING OFFICER (Ms. Murkowski). The Senator from Oklahoma.
Mr. NICKLES. Will the Senator yield?
Mr. CORZINE. Certainly.
Mr. NICKLES. I am trying to figure out how the amendment would work.
You are assuming the highest income level people would have no
reduction in their tax rates going back to 2001, so their personal
income tax rate would be 39.6 percent?
Mr. CORZINE. The Senator is right, except for the 2001. It is moving
back up to the 39.6 percent rate for those over $1 million.
Mr. NICKLES. If the Senator will yield further, would that include
the rate on capital gains?
Mr. CORZINE. It would.
Mr. NICKLES. And the rate on dividends?
Mr. CORZINE. It would.
Mr. NICKLES. Madam President, I have great respect for my colleague
from New Jersey, but this is one of the worst amendments I have seen.
This is a tax increase of $160 billion. The Senator from New Jersey can
assume it will only be on millionaires, but you cannot do that.
Therefore, it is a direction to the Finance Committee to raise $160
billion. It assumes it would be saving Social Security, but it will
not. It will not in any way, shape, or form. He assumes it will be put
into a trust fund to save Social Security, but it will not. It raises
taxes $160 billion.
I will talk about, if he was correct, how bad that would be. It would
be kind of interesting to say everyone in the country gets a capital
gain rate of 15 percent, but if you happen to be at an income level of
such and such, your capital gain rate is twice as high; it is 39.6
percent. That is very strange.
I assume, too, if you had dividend rates now and we set them now at
15 percent, and that helped the market a lot, and we tax dividends
higher than any other country in the world, but we helped that in last
year's bill by cutting dividends to 15 percent, and you say dividends
will be taxed for everybody in the country at 15 percent except for the
highest income people, that will be at 39.6 percent, you are getting
into a mess as far as administering the Tax Code.
What about this instruction to increase it $160 billion? How does
that save Social Security? I tell my colleagues, Social Security has a
$4.9 trillion unfunded liability. If this makes sense to do it to
Social Security, the unfunded liability over 75 years for Medicare is 3
or 4 times as high. The last estimate I had was $15.3 trillion for
Medicare. We made it worse last year when we expanded the Medicare
benefits.

First, if we went with the amendment's assumption, you would be
increasing the maximum rate at least to 39.6 percent. The maximum rate
on corporations is 35 percent. So why would we tax individuals who
happen to be proprietors, who own their own business, who happen to be
the individuals who are creating about 80 percent of the jobs, and
probably 80 percent of the people who pay maximum rates are
individuals, self-employed proprietors, maybe doctors and lawyers,
hiring a lot of people, but we will tax them higher rates than we tax
Exxon and we tax Goldman Sachs, the corporation. They pay 35 percent,
but we will say we will have these individuals pay an additional tax up
to 39.6 percent, and then to say we will put it into a fund, that just
will not work.
What we would do, the net essence, is raise taxes $160 billion.
Presumably we will put it into a fund, but with the deficit situation
we have right now it will be spent. It is absurd to think it would not
be spent. It will be spent.
You might have an IOU in that fund, but if the Government collects
the taxes--I made this speech yesterday; I don't want to be redundant,
especially this late--all money will go into one pot, and if you want
to have a little paper entry that says IOU over here and you have
another fund that says IOU, and someone assumes it is to pay Social
Security, that is not the way it works. It would not work that way.
I appreciate my colleague's amendment. I hope our colleagues would
vote no on this amendment to raise taxes by $160 billion on a lot of
small business entrepreneurs throughout the country. I think it would
be slamming the door on economic recovery right off the bat. I urge our
colleagues to vote no. We will vote on this amendment tomorrow morning.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. CORZINE. Madam President, would the chairman acknowledge the $160
billion is only for 5 years? If you were to implement this policy over
the full 75-year timeframe, the present value would be roughly $1
trillion. My calculation is not down to the last decimal point. But the
point being not that $160 billion will save Social Security, nor $1
trillion, but doesn't the Senator think we ought to be making steps,
even if it is not this approach, to begin to address these shortfalls
as we go forward?
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Madam President, I don't think this economy needs a big
tax increase. I have not figured out percentagewise what it would be if
you applied it to upper income, but it is an increase of about 15
percent, I guess maybe 14 percent on some of the most productive people
we have in the country.
That is a good way to encourage a lot of people to go overseas. That
is a good way to encourage more business in other areas. That is a good
reason for people to outsource more to other countries that do not have
tax rates this high.
I find this to be very shortsighted. This is a big tax increase. It
would not be funneled into Social Security. If you want to do that,
increase the payroll tax. Some people think we will save Social
Security by increasing some people's income tax. That is not my
opinion. Very shortsighted. We pay Social Security right now. It is
basically an unfunded, defined benefit plan. It is a rollover type
plan, money coming in, money going out. Right now a little more is
going in than going out, but there is significant liability. It has
never been a funded, vested plan. It is basically a pay-go system, paid
for under the payroll system.

Some think it should be changed. I happen to think maybe it should be
changed in line with what the President suggested, where we move it
from a defined benefit to a defined benefit plus a defined contribution
plan; where we allow individuals to take a percentage of their payroll
and put it in their own bank account where they own it and they control
it and they are not dependent on Government promises to provide future
benefits.
That is a debate for another day. That would help save the system. I
used to be a trustee of a private pension system. Our system, like
millions across America, moved away from a defined benefit system to a
defined contribution system. Federal employees have done the same
thing. Frankly, that will continue happening and will continue
happening. We need to let individuals have the opportunity to grow,
own, invest, and control part of their retirement funds, including
Social Security retirement funds.
This, however, is not that solution. This is a solution that says
let's not only have the payroll tax--and I might mention, the payroll
tax is already very large. The payroll tax of Social Security is 12.4
percent of payroll. Matching employee and employer, 6.2, 6.2, 12.4
percent of all payroll going up to 87,000 is paid into Social Security.
That is a lot. That is thousands and thousands of dollars.
Incidentally, the individuals get a crummy deal because they have to
pay

[[Page S2535]]

taxes on it before they make their contribution. So they have to use
aftertax dollars to make their Social Security contribution.
This is not a great deal for individuals. They can do a lot better if
they were able to invest some of their own money in their own accounts,
and let it grow--hopefully, grow tax free--so they would not be so
dependent on Government.
This solution says, let's have not only the payroll taxes and the
demographic challenge that we have with payroll taxes--because right
now you are going to have a lot more people drawing the benefits and
fewer people paying as the baby boomers retire--but let's create a tax
surcharge or an income tax just on a very small percentage and really
sock it to them. And we will say we are putting that into a fund.
All that fund would be used for would be to maybe reduce debt or
maybe finance more spending. The direction in this amendment is: Well,
let's create a fund. Basically, the Finance Committee might create a
fund, but there are going to be more taxes raised. It would be a $160
billion tax increase over the next 5 years.
I do not doubt my colleague from New Jersey; it may be $1 trillion
over the next umpteen years. I think it would be very shortsighted
economic policy.
Marginal rates make a difference. I used to run a manufacturing
company. I used to have a janitor service. Marginal rates made a
difference when I had a janitor service because I found out I was
working just as much for the Government as I was for myself. And why
would you build or expand?
The Senator's amendment would move us very close to 40 percent, not
counting State income tax, not counting city income tax, if you happen
to live in some cities. If you add all that together, people will say:
Why should I grow, build, or expand? If they do not expand, they are
not creating jobs. This is a very bad amendment if you want to grow the
economy.
The real future of Social Security is going to be dependent on a
growing economy. This amendment would be sending the signal we are not
interested in growing; we would rather have you leave.
So I urge my colleagues to vote no on the amendment.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. CORZINE. Madam President, I would like to make just a couple
observations relative to the views of the Senator from Oklahoma.
The last time I checked, when marginal rates were 39.6 percent for a
whole wider range of Americans--and I do believe marginal rates and
large increments do make a difference on the motivation to work--the
economy grew for 8 straight years, producing 22.5 million jobs. We had
4, 5 percent productivity, the highest growth in small business in the
history of the country.
It is hard for one to imagine just exactly how that marginal rate
ended up being so dampening to economic growth given the reality of the
economy's performance in the 1990s. And now what we are talking about
with this suggestion applies to two-tenths of 1 percent of taxpayers.
I would also suggest that there are many differentials already in the
Tax Code with regard to tax payments on dividends. It is not a flat
application of the dividend rate for all businesses. So there are many
circumstances where you could end up having a differential of rates.
I think the choice that we are making here is: Is it worthwhile to
protect guaranteed benefits--again, where one-third of Americans now
are 100 percent dependent on Social Security as their sole protection
for their senior years and another third are 50 percent or more
dependent? Do we want to continue to have a social safety net, a
guaranteed benefit for Americans? I think that is a compact and a trust
we put together.
This is one of the ways that we can begin to address it: a $1
trillion present-value step, if we were to implement it. So I hope my
colleagues will take into account whether we want to maintain Social
Security with its guaranteed benefit structure or are we going to put
ourselves at risk, having to change that program because we do not have
the long-term actuarial protection of the ability to fulfill the
obligations that are accumulating by Americans who work, the
fundamental value that we take on here.
The folks from the State that I call home tell me that Social
Security is vital to their long-term security. And I hear from those
folks that they would like to see a program that is not at risk, but
they want to maintain that guaranteed benefit.
This is one of those steps we can take to make that happen.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. ENSIGN. Madam President, I have just a couple thoughts to share
tonight on the Senator's amendment and on Social Security in general.
The Senator from Oklahoma mentioned what the Senator's amendment
would actually do: raise taxes, supposedly to put into a fund to save
Social Security.
First of all, it directs the Finance Committee to raise taxes. You
cannot tell the Finance Committee, in a budget resolution, what taxes
to raise. It could easily raise taxes on the child tax credit. It could
easily raise whatever taxes it chooses to raise. You cannot direct the
Finance Committee on what taxes to raise. We all know that.
Any of the amendments that have been put forward today that say,
well, just raise the tax on millionaires, you have to be on the Finance
Committee to be able to direct that. That may be your desire, but that
is not the way the budget resolution works. You can just direct the
amount of money for the Finance Committee to raise. And I think the
Senator from New Jersey is aware of that.
As far as putting it in a fund, this Senator has only been here for 3
years. I was in the House of Representatives for 4 years prior to this.
The one thing I have learned around here, first of all, is that there
is no Social Security trust fund; it is a bunch of IOUs. It is simply
an accounting system that we have. Taxpayers, basically in the future,
will pay taxes to fund this accounting gimmick that we know as a trust
fund.
In most companies, the way they set up trust funds, they actually
take the money and invest it. That money accumulates. There are
actually real assets. There are not real assets, other than the word of
the United States, in the Social Security trust fund. That is really
all we have.
Mr. CORZINE. Will the Senator yield for a question?
Mr. ENSIGN. Let me make a few points, and then I will be happy to
yield.
There is no cash. There are Treasury bills, basically financing debt
that we have for the long term. And we get a very low rate of interest
on those for the Social Security trust fund.
The pension systems of companies and States have real assets in them.
The State of Nevada has the Public Employees Retirement System. It is a
system that a lot of States have.
Most teachers, police officers, and the like are not in the Social
Security system because they are in a pension system. The easiest way
to explain that is, instead of the taxpayers of today paying for the
retirees of today, the retirees' money that they earned while working
got put in a system that earned money, so that when they retired they
started getting that money back out with interest.
For retirees of today under Social Security, theirs was put in a
paper account. It has earned a tiny amount of interest, but the workers
of today pay in taxes for their retirement payments. That is how it
works. It is a complete difference.
By the way, for the State of Nevada, since we have had our PERS
system--I think for 25 or 30 years, whatever it has been--the average
rate of return has been 11 percent. Social Security is about 2, 3
percent, somewhere in there--1 percent. It is a lot lower, we know,
than 11 percent.
If Social Security would have been set up as a retirement system, as
a pension system with real assets, what the Senator is trying to do--
put money into that system--may work. But it is not set up that way.
It is set up as a pay-as-you-go system. All this money you give to
Congress today, they will spend it. I have been around here 3 years,
but it is obvious: If you give more money to this Government, it is
going to spend it. It

[[Page S2536]]

is an easy way to get reelected, just giving money to people.
So while the Senator from New Jersey wants to put it in to save
Social Security, it is not going to do that.
As a matter of fact, it will raise the baseline which will put more
liability into the future.
I yield the floor.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. CORZINE. Mr. President, if I might ask the Senator from Nevada a
simple definitional question, I think government bonds and treasury
bills are assets. They may not be as high yield assets as those
available to the investment profile that is the Nevada PERS fund, but
then again, it is also an asset that provides presumably greater
security and less volatility and less risk to those who would benefit
from it down the road. Social Security, while it has pay-as-you-go
characteristics, has never been a system that was without accumulated
reserves or deficient reserves.
There is a time for us to have a debate about Social Security that
goes further than we do tonight, but my view is if we reduce the amount
of borrowings that are taken out of the Social Security trust fund to
fund everything else we do in government, we would be a lot safer in
the long run, and that is what my amendment is really to accomplish.
The reserve is going to lower actually the amount of borrowing the
Federal Government has to do.
I think it is up to us to express the self-discipline of not having
unlimited tax cuts and also discipline with regard to spending. It is
not just on the spending side that we have shown a lack of discipline
that has allowed us to get to $5.5 trillion of publicly held debt.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. ENSIGN. If I may respond to the Senator from New Jersey, first of
all, we have a difference of philosophy. The ranking member on the
Budget Committee and I had this discussion last night. There is a
difference in philosophy. This Senator believes in cutting tax rates,
giving entrepreneurs more of their own money. For instance, when I was
practicing as a veterinarian, I was a sole proprietor. If I wanted to
expand my business, I looked at my costs, and I looked at rate of
return. Part of that was taxes. Could I justify expanding my business.
I looked at the cost of borrowing. I looked at the cost of taxes. I
looked at all those variables. The higher you raise the cost of taxes,
the less expansion of business you are going to get, the fewer jobs you
are going to create.
While we have to have tax rates that allow what we believe in to be
funded, there is a balance there. I believe if we raise taxes, as you
are suggesting, especially as fragile as this economy and this economic
recovery is, it could send us back into a double-dip recession as we
have seen this economy do historically several times.
I think raising taxes would actually threaten the Social Security
trust fund because, as the Senator from Oklahoma said, the only real
security for the Social Security trust fund as it is set up today is a
strong economy.
We have the baby boomers who are retiring, this huge demographic
shift. When Social Security was first set up, there were 39 workers for
every one retiree. The retirement age was 65. The average age when
people died was 63. That is why a pay-as-you-go system worked for all
those years. We had plenty of workers to pay for the retirees. We are
down to less than four workers for every one retiree today. We are
going to two to one. In future years, if we continue with the birth
rates and the increase in age that people live, we will be down to one
to one. A pay-as-you-go system does not work in that regard.

It is an important debate to have. I realize we are not going to
solve this on the budget resolution, but the bottom line is, a strong
economy is the only way in a pay-as-you-go system, a growing, strong,
healthy economy is the only way for you to be able to have enough
revenues coming into the Federal Government to be able to pay Social
Security retirees.
If we want to change the system, and I believe in changing the
system, keep it the way we have now, but for the future having similar
private accounts, whether it is like we have a Nevada PERS or whatever
it is, to where you have real assets that are returning a better rate
of return that many other countries in the world are changing their
Social Security systems into, if we have that, that is a better way for
the long-term solvency for Social Security, in this Senator's opinion.
But the current system would be threatened by the amendment of the
Senator from New Jersey because we are in the situation of a fragile
economy, and tax increases could send us into a double-dip recession.
Mr. BUNNING. Mr. President, I express my support for the budget
resolution.
We have seen tough economic times take jobs from the average
American. We have seen new spending in the face of terrorism and war
increase the deficit. Today we respond with a budget resolution that
will set the correct tone for our country.
We now see that the President's tax cuts we passed in 2001 and 2003
are jumpstarting the American economy and providing us with some
positive movement in job creation. This budget will extend the tax
reductions that have fueled our economy and have helped the average
American worker.
Thanks to this budget resolution, we will reduce the deficit by $139
billion to a total deficit of $338 billion in 2005. Our reductions
follow the President's plan to cut the deficit as a percentage of our
economy in half by 2006. We will hold the line with an $814 billion cap
on discretionary spending and even decrease mandatory spending by $5.7
billion.
This budget is a blueprint for America tomorrow that recognizes the
realities of today. Those realities call for strong budgets for our
military and for the State Department. There are real threats on the
horizon that we cannot ignore. We must have the manpower,
infrastructure, and intelligence network to protect all Americans from
the threat of terrorism. We cannot afford to lose sight of the
importance of these programs.
Of course, spending more in the budget to protect Americans means
that some other worthy programs will have to face a little belt-
tightening. But as we review our spending levels, we have an
opportunity to allocate some new monies and focus on new priorities.

One such program is the Pell Grant program. Since 2001, Pell Grant
funding has increased by 47 percent. In committee, I was able to amend
the budget resolution to increase Pell Grants for students who are
willing to work harder in high school. This $33 million program will
allow students who participate in a ``State Scholars Program'' to
receive an extra $1,000 for their college education.
We will seek out those students who work harder and strive for better
college preparation from their high school education and reward them
with more money for college. Motivating our young Americans to learn
today will create a skilled workforce tomorrow.
Another area we have expanded is veteran's medical research. The
Budget Committee unanimously agreed to my amendment to add $536 million
in funding over 5 years for veteran's medical and prosthetic research.
That is a 25 percent increase in fiscal year 2005 funding over this
year's level.
We owe it to the men and women of the armed forces to expand these
programs. And breakthroughs in medical research funded by this program
will benefit all Americans, not just those in uniform.
But one of the most important provisions this budget addresses is the
tax cuts we have fought so hard to enact over the last few years. We
have to stop the average American from getting a tax increase next
year. That is why this budget will extend several provisions that are
set to expire at the end of this year, including the $1,000 per child
tax credit, the 10 percent income tax bracket expansion, and marriage
penalty relief.
We passed these tax cuts to help the American family. And just as
America is finally getting back on track and creating new jobs, we
can't throw the weight of a tax increase on the shoulders of working
Americans.
This budget offers responsible spending, protects the tax cuts that
have stimulated our economy, and cuts the deficit. We have taken a hard
look at our priorities and how we can help the

[[Page S2537]]

economy. But we're getting stiff resistance from across the aisle. They
have attacked these needed tax cut extensions and sensible spending
policies.
But they offer no constructive criticism or alternative solutions.
They just throw rocks and complain about our budget proposal. When they
ran the Budget Committee, they couldn't even get a budget that could
pass on the floor of the Senate.
We also hear complaints about Social Security. Where is their plan to
grapple with the future of Social Security? Where were they when the
Clinton budgets ``spent'' the Social Security Surplus?
As our Budget Committee chairman said this morning, this budget will
treat Social Security exactly the same as past budgets. The trust fund
balances are available for future benefit payments, just as they were
described in the fiscal year 2000 Clinton budget, which said, ``they do
not consist of real economic assets that can be drawn down in the
future to fund benefits.'' We'll keep our Social Security money in
treasury bills just as we always have and in fact, are required to do
by law.
I am ready to tackle the problems Social Security will face in the
next several decades. I, unlike many who just complain about the
problem, have spent a lot of time thinking about Social Security,
particularly during my time as chairman of the Social Security
subcommittee in the House. In the past, I have even drafted and
introduced an option for improving the system. Very few can say that.
All can complain, but few are willing to be constructive.
I hope my colleagues can look past the partisan bias and rhetoric
coming from some across the aisle. We drafted in the Budget Committee a
serious proposal that addresses spending levels and our economy.
I support this budget before us today because it recognizes the
realities of our world, the necessity to limit spending, and the
importance of creating jobs and keeping the average American on the
road to economic recovery. I urge my colleagues to support the budget
resolution before us.
(At the request of Mr. Daschle, the following statement was ordered
to be printed in the Record.)
<bullet> Mr. JOHNSON. Mr. President, as the Senate considers the fiscal
year 2005 Federal budget, I want to address what I believe are the
deeply misplaced priorities of the Republican budget plan and the
dangerous fiscal course facing the Nation.
In 3 short years, the Nation's fiscal health has deteriorated to the
point of turning a record budget surplus of $236 billion in 2001 to a
gapping projected budget deficit of $477 billion. Instead of working to
steady the country's fiscal condition, the budget plan the U.S. Senate
is considering will contribute an additional $179 billion to the
Federal budget deficit over the next 5 years by permanently extending
tax cuts for the richest one percent of American taxpayers.
There is another approach. It is an approach that strengthens the
fiscal integrity of the government, while addressing the pressing needs
of the 40 million Americans without health insurance, ensuring the
solvency of the Social Security trust fund, as well safeguarding the
homeland.
On Thursday, March 4, on a party line vote, the Senate Budget
Committee approved a budget that adheres too closely to the President's
budget plan and sets the wrong priorities for securing the homeland,
creating the conditions for job growth, and tackling the out-of-control
Federal budget deficit. Under the budget plan the Senate is
considering, the Federal budget deficit would actually increase $179
billion above the Congressional Budget Office CBO baseline. To
forestall a further run-up on the government's credit card, the Senate
should amend the Republican budget plan by identifying a combination of
spending reductions and increases in revenues that will achieve the
goals of reducing deficits and strengthening the economy.
In 2001, President Bush pushed through a sweeping tax cut on the
rationale that the historic budget surpluses built up during the
Clinton administration justified reductions in taxes. At that time, the
Federal budget was at a record budget surplus of $236 billion and I,
along with many of my colleagues in the Senate, agreed that taxes
should be reduced. Now that the fiscal condition of the country has
swung deep into the red, it is necessary and prudent to reevaluate
permanently extending tax breaks for the highest income levels. Such an
approach, in combination with focused spending discipline, could reduce
the deficit that threatens the long-term fiscal health of our country.
Instead of pursuing this approach, President Bush is asking Congress
to make permanent the tax cuts that have put us in this situation.
Since the United States is already in red ink, obviously the money for
this new distribution will require decreases in important domestic
spending and borrowing from the Social Security trust fund. I believe
this is a terrible idea when other pressing budget priorities are
shortchanged and cut.
Our Nation's veterans are currently on year-long waiting lists to get
access to VA health care, our rural hospitals and nursing homes are on
the verge of closing because of inadequate Medicare/Medicaid
reimbursement, our schools are struggling to stay open due to reduced
budgets, and the President says we don't have the funds for South
Dakota's water projects. Some may see the people affected by these cuts
as ``special interests.'' I see them as South Dakotans who should not
be short-changed to provide tax cuts that overwhelmingly benefit the
wealthiest one percent of Americans.
I remember when being a conservative meant living within one's means,
and that is the strategy our Nation ought to return to. President
Clinton had it right when he called for an secured a balanced Federal
budget--that meant we were not borrowing from Social Security, we were
not creating huge new debts for future generations to pay off, we were
creating millions of new jobs, and we were not jeopardizing Medicare
and Social Security. Government is about priorities, and the Bush
administration's budget priorities are wrong in too many instances. I
will continue to do all that I can to redirect our Nation's resources
to an agenda that better meets America's domestic needs and our
international moral obligations.<bullet>
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Madam President, we have had a good debate. I appreciate
our colleagues staying this late. We have been on this bill for a
little over 13 hours today. I think we have made a lot of progress. We
are going to have to make a lot more progress tomorrow.

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