Guardsmen and Reservists Financial Relief Act of 2004

Reserving the right to object.

Thank you.

Mr. President, I want to begin by thanking Senator Grassley, chairman of the Finance Committee, for his hard work on this bill. It has been a very difficult and complicated process. He and his staff, as well as Senator Baucus, have done an extraordinary job moving a $137 billion tax benefit bill through the Senate and through the Congress over the last 2 years. We have been intimately involved in the building and crafting of this bill. There have been literally hundreds of meetings, hearings, debates, and negotiations, some public and some in private, over the last 2 years to put together a bill that is $137 billion.

My colleagues will note these bills that are on their desks that have been here since Thursday morning. This was printed Thursday morning or Friday morning and distributed to us, the first time that we have had this in its entirety to read its contents and to understand what is in it. We had our version, but we sent it over to the House and then the conference version came back.

Mr. Grassley, the Senator from Iowa, and the Senator from Montana have done a great job trying to provide a lot of good provisions in this bill. I am going to speak about that specifically in a moment. But before he left the floor I wanted to commend him for his work.

I rise today to speak for 40 minutes and will continue to speak throughout the course of the debate, which may go on for a day or two or three or four until we finally wrap up the business of this session. I will continue to rise and speak about one item that was conspicuously and unconscionably and unjustly left out of this bill. There was one item that we had passed out of the Senate, a unanimously by voice vote, Republicans and Democrats, unanimously sent over to the House, to include in this $137 billion tax bill an amendment for the Guard and Reserve called the Guard and Reserve Paycheck Protection Act--the Guard and Reserve, the 640,000 men and women who have been called up since the conflicts started in Afghanistan and Iraq, the men and women on the front line supporting our Active troops, protecting us at ground zero of the war on terror in Iraq and Afghanistan.

We had a provision in there to keep their paychecks whole. It was taken out by the Republican leadership of the House.

Before I get into the details, let me just divert and say, to get off on a little bit of a lighter and more positive note, I congratulate our LSU team, our Southern team, and our Grambling team for winning on the football field last night. LSU came back from a very dramatic game, which I got to watch part of after being here late into the night, and won 24 to 21 over Florida. Southern beat Alabama 33 to 24, and Grambling beat Mississippi State 34 to 26. And Louisiana at Monroe beat Idaho--I am sorry to say to the Senator from Idaho--16 to 14. The teams from Louisiana won last night.

I feel strongly that the people of Louisiana would like us to make our best effort to make sure that we can win throughout this week, whether the action is taken now or the action is

taken sometime in the near future, for us to win for our Guard and Reserve on the front lines.

I don't know why the provision was left out, but I would like to share a visual that is pretty dramatic. I have shared it before. I want to be clear: I have spoken on this on and off for several hours for the last 5 days. I don't object to anything in this bill. Although there are other Senators on both sides, Senator McCain, Senator Harkin, Senator DeWine, Senator Kennedy, other Senators have expressed real concern. I appreciate those concerns. But that is not my issue. That is not why I have stood on this floor objecting.

I am objecting to the passage of this bill because it left out the men and women who are on the front line of the war on terror, whether they are at home as first responders or in Iraq or Afghanistan. Members of our Armed Forces were left out of a $137 billion tax credit bill. We could not find one page, one paragraph, one sentence to include them in. You can sit here all day and read this bill. I am going to see how many pages are in the bill. It looks like there are about 650 pages of provisions. We refer to this around here as the FSC/ETI legislation. We have been working on it for 2 years. It is supposedly a jobs bill. It supposedly provides tax relief to good companies, large companies, small companies, companies that import and export, companies that perhaps deserve the relief.

The bill started out correcting a decision made by the World Trade Organization to correct basically a $50 billion problem. But as you know--because the President pro tempore is experienced and is chairman of the Appropriations Committee and one of the senior Members of this body--tax bills have a tendency to grow. They keep growing and growing and growing and getting bigger and bigger and more and more expensive because it is very tempting for individuals and corporations and people who petition their Government who want relief or some special credit or want some special provision or think they are not being treated fairly--they petition all of us.

Well, there was one group that sent some of us a letter. I would like to read from this letter, the statement they sent, the Reserve Officers Association of the United States of America, the men and women on the front line. It was signed by Robert MacIntosh, who represents the major general: We continue to support tax credits for employers of reservists and National Guardsmen.

This position is a result of a problem faced by employers of Reserve members who support our forces when they are mobilized. The extended mobilization and stop-loss authorities, which means basically a backdoor draft, enacted by the President and the service Secretaries to support Operation Iraqi Freedom and Enduring Freedom in Afghanistan have served only to exacerbate these problems. Many employers want to extend pay and benefit coverage to the reservists but are finding this to be an unanticipated, long-term expense as operations in Iraq and Afghanistan entail multiple years of mobilization. Reservists are finding re-employment and employment difficult for the very same reason. As reservists' employers shoulder the burden of extra costs to support the employee's participation in the military, they become direct contributors to our Nation's defense. Employer pressure is listed as one of the top reasons for reservists to quit military service.

The ROA is disappointed to learn of recent actions by the House that defeated, by a voice vote, an attempt to revive amendment 3123 to Senate Report S. 1637, which would have provided a credit for the replacement employees of ready Reserve and National Guard employees called to military active duty.

The Reserve Officers Association of America--I am going to paraphrase here--represents the men and women who are carrying, in many ways, 100 percent of the risk, taking 100 percent of the bullets, leaving their families for hours and weeks and months and days for their training and their deployment.

I am paraphrasing this to say that the ROA urges Congress to support the employer tax credit as a means to eliminate civilian employment conflict and support recruitment and retention efforts.

It has come to the attention of some of us who have been involved in the Armed Services Committee--I have served on that Committee for several years and continue to support provisions through my position on Appropriations, as the Chair does, and many other Members of this body, support for our troops. I have supported provisions that support the Guard and Reserve as well as our Active because of many reasons but one in particular, which is that in the last several years, as you can see from this chart, our Government--all of us, the past President, the current President, the past Congress, this Congress, and Members from both sides--has basically rewritten the policy of defense. We have said we are going to have a total force structure, and it is going to be composed of 1.6 million Active-Duty officers--soldiers, sailors, marines, and Air Force--and we are going to have 1.2--that is the troop strength of our Guard and Reserve.

One of the reasons we count on the Guard and Reserve is for the benefit of the taxpayers, because it is not as expensive. They have civilian jobs and they only go when called up. They don't have to support them 24-7, year after year. We ask them to be ready. The least we can do is send them to Iraq with a full paycheck. We didn't do that because there are higher priorities in the bill. Every Member has come to say something about a priority in this bill. It could be any number of manufacturers. But for the record, for this Senator--and I know others join me--there could not possibly be any higher priority in this country today, right now, than the men and women who are fighting on the front lines in Iraq, Afghanistan, and their families who support them.

As you know, Mr. President--and I do because I have visited many bases and spent a lot of time with our troops--the truth is that most of the soldiers are used to sacrificing. It is why they signed up in the first place. They think it is a virtue. That is something we can learn more about in this Chamber, including me. I don't sacrifice nearly as much as I should. They are quite an inspiration to us. They don't mind making the sacrifice. I have not had one soldier bellyache about anything, even those who lost their arms and legs. Most of them say: Stitch me up and let me go back to the front line. That is admirable. You would think we could honor their service with more than pictures and words or by putting them in a bill.

They didn't ask for the whole bill or half of the bill or even for 25 percent of the bill. They asked for $2 billion out of $137 billion. We could not find it anywhere. We could not find the time, the will, the attention, or the focus to give them a little percentage of this bill.

Let me tell you how many of them we call up. We seem to be able to find their phone numbers when we call them to service but not to put them in the bill. From 1953 to 1989, we called up 200,000 Guard and Reserve. This was the traditional way we operated in our Government to protect the country. We would call them up when we absolutely had to: during the Berlin crisis of 1961, we called up 148,000 of them, and 148,000 families stayed home and prayed for their safe return. During the Cuban missile crisis, we called up 14,200, and 14,200 families stayed home and prayed along with their neighborhoods, churches, and places of employment for them to come back. You can go through this list. There were 199,000 from 1990 to 2004, just in the last 14 years, 8 of which I have been a Senator in this Senate and a member of the Armed Services Committee, so I know something about this. We have called them up time and time again and told them to leave their wives, their children, their employment, and go to the front lines. And they go--proudly. They don't ask for much. They served in the Persian Gulf war, 238,000 of them. They went to Haiti, 3,680. They went to Bosnia, 29,670. They served in Operation Southern Watch, 2,038. They went to Kosovo, 5,933. And they went to Afghanistan.

Today, before I came to the Senate to speak, I turned on television set and the headlines this morning across the Sunday shows is ``Elections Going on in Afghanistan.'' Who do we think made those elections happen? Did we

just wish for those elections to happen? I don't think so. Our troops made those elections happen. They wouldn't be happening without our Guard and Reserve troops, and our Active Forces.

I don't care how many speeches we give. I don't care how many bills we write. I don't care how many budgets we pass. The fact is, those elections would not be taking place today if it were not for these troops. They are good enough to get those elections started, but they are not good enough to be in this bill? That is why I am standing on this floor until the last possible minute that I can to delay these proceedings--not to be obnoxious, not to be ridiculous, not to be uncooperative, not because I don't support transportation, not because I don't support shipbuilding, but because I think we owe it to our troops to stand up for them. And I plan to do it.

Now I am going to talk about a couple of arguments I heard.

Mr. President, how much time do I have remaining?

I thank the Chair. I want to talk about a couple of arguments I have heard the last couple of days, directly and indirectly, about why some Senators would object.

I want to be very clear. I know, as sure as I am standing here, at some later date I am going to have some sort of critic of mine, and I have my share of critics, standing up saying: There goes Senator Landrieu again. She's against tax cuts. She's trying to slow up our transportation bill. She's trying to slow up the highway bill. She never supports tax credits.

I am going to keep saying for the record the only reason I stand here, the only reason, is to try to get this Senate to do what it did a couple of weeks ago, which was to send over to the House of Representatives a bill that would include the Guard and Reserve.

There is nothing I can do as a Senator to make the House Republican leadership respond other than to bring this to light, to urge my colleagues to stand with me, Republicans and Democrats together, over here in the Senate, and send the bill back to the House and ask for them to consider it again. Maybe they made a mistake. Maybe they didn't realize this was one of the items. I don't know. I am not on the Finance Committee.

I sent a letter. Twenty-one of us signed it. I put it in the Record before so I won't read the letter, but it is addressed to Chairman Grassley; to Ranking Member Baucus; to Bill Thomas, chairman of the Ways and Means Committee; and to Charlie Rangel, the ranking member.

I see Senator Baucus has come to the floor. I know he supports this provision, I know Senator Grassley supports this provision, and I know Charlie Rangel supports this provision. What I am not sure about is the chairman, Bill Thomas. I don't know, maybe he didn't realize it was part of the request. There were over 2,000 requests, as you can see. I don't know how many items are in this bill, but it has to be thousands of items. I know it is difficult, so I am assuming he didn't know about it. That is why I am spending some time talking, so maybe the word will get there.

Twenty-one Senators signed this: Kit Bond of Missouri, a leading advocate for the Guard and Reserve signed this letter, along with Mark Pryor, Chris Dodd, Danny Akaka, Byron Dorgan and Senator Mikulski and Senator Lautenberg, Senator Murray, Senator Corzine, Senator Cantwell, Senator Schumer, Senator Nelson, Senator Tim Johnson, Senator Feingold, Senator Dayton, Senator Sarbanes, Senator Durbin, Senator Wyden, Senator Levin, and Senator Leahy. I am sure there will be other Senators on both sides who will let their views be known to the House Republican leadership.

How in the name of heaven could the House Republican leadership put a bill together and leave out the Guard and Reserve? Tax cuts for fan importers? I want the fan importers to know that I am not picking on them. But I think this picture speaks a thousand words. For some reason--we could find a reason, and it may be a good one. I am sorry I don't know the details of it. I can't talk about it. I understand there is a good reason. Maybe someone could explain it, about the fans. But they are in the bill. The fans are in the bill, but the guys in Iraq or Afghanistan, where it is 105 degrees most of the time, in tents that are hot, carrying 50, 60 pounds of equipment and armor, who could use these fans, can't even get a paycheck to buy the fans.

When they go to Iraq they leave their civilian paycheck at home. They leave the comfort of their families at home. The GAO report is that most of them take a 41-percent pay cut. We couldn't find time to acknowledge that and say: My goodness, we are passing a tax bill, maybe we can fit them in.

We can't fit them in the tax bill. We can't fit them in the Transportation bill. We can't fit them in the Homeland Security bill. We can't fit them in the intelligence reorganization bill because, obviously, we don't think they have anything to do with our security.

Whether you think the front line, as I said, is in Iraq in the war on terror--which is an issue of debate, and I actually could debate that. Maybe it is not exactly the front line. But regardless of whether you think it is the front line, the second line, the third line or the back line or whether you think it is in Afghanistan, the fact is, we sent them there. We sent them there with half a paycheck, or 75 percent of their paycheck, so their families at home can lose their houses and lose their cars?

If anybody doesn't think that is true, please go to my Web site or talk to me. I will most certainly give the information to you. You know it yourself. You have seen the reports about the sacrifices families are making.

There are some other arguments that were made about this. One of them was Senator Landrieu and others are just complaining. They want to slow the process down. I hope I have answered that argument. I hope my colleagues and the leadership know I am not trying to be uncooperative. I understand people's schedules. I have two children, 12 and 7; I understand schedules. But my family supports it. They understand what I am doing, and I told them if it takes 4 days or 5 days or 3 days or 2 days, it is going to take it. I am sorry. But I think I owe it to the 5,000 men and women from my State who are serving in Iraq and Afghanistan because I just went home 3 weeks ago and waved goodbye to a lot of them.

I have been to Fort Hood and Fort Polk, telling them I am with them, taking pictures with them, and I'll be darned if I will take the pictures with them and not stay in the Senate and fight for them.

One of the Senators came to the floor this morning to argue we had eliminated the haircut provision--whatever that is. We support, in this bill, contributions of our industry. What about the contributions of the employers, small businesses and large businesses, that are carrying the extra burden of our defense by making those paychecks whole, sometimes at great difficulty to those businesses? What about these companies? I am going to provide a list in just a minute of some of those companies, which I have for the Record, but hundreds of companies, thousands of companies are trying their best, in some difficult times, to make those paychecks whole.

Why should we be giving tax credits to every other company? Some of them may overlap, but there is no mention of that in this bill. There is no direct support to the many companies that are being patriotic, that are doing the right thing.

Let me say something about these companies that are the beneficiaries in this bill. Again, many could be in shipbuilding, could be other manufacturers--I don't think there is one company that benefits from this bill, small or large, with 5 employees or 50,000 employees, that would say to the Members of the Senate: Please put me ahead of the Guard and Reserve. I don't believe it. That is why I have confidence I can stand here and I can talk about this. I do not think one industry in my State believes that in any way I am trying to take a penny away from them.

But for our Guard and Reserve, and their employers, in a time of war, at a time of great sacrifice, to ask to be included in the bill, I think they will find it very difficult to explain why they are not.

I know the third argument people have made, and I think I heard the chairman talk about it, is this is a jobs bill. I know jobs are important. I would like to make more happen in my State to create private sector jobs, high-paying jobs, good jobs. I do believe there

are some provisions of this $137 billion bill that will create jobs. But what job could be more important to our security than the job of our men and women in uniform and their service to our country?

Again, let me put up a chart that shows how many have gone, how many are serving, and to ask what we might do for them.

There is a total of 690,000 Guard and Reserve who are, right now, on the front line. Each of them, I presume, has some outside employment. Maybe some of them are working two jobs in their civilian life. These are doctors, lawyers, architects, truck drivers, policemen, firemen, nurses. There are 90,000 of them on the front line doing the work, but they are not in the bill.

Mr. President, how much time do I have remaining?

Mr. President, in all of our States this is the number of the National Guard on active duty or alerted. You can see here that it is a very high percentage in many places in the country.

In Louisiana I have almost 40 percent of our Guard and Reserve who have been called up and activated.

In Washington State, 46 percent, almost half of their Guard and Reserve, have been activated.

In the State of Texas, 28 percent have been activated.

We can see this in every part of this Nation from the east to the west. In Hawaii, 57 percent--57 percent, almost 60 percent of the Guard and Reserve from Hawaii have been called up to serve.

These numbers may fluctuate as the needs of our military and the decisions made by the executive branch, the President and the Pentagon, change about where to shift these forces. But every one of these percentages represents thousands and thousands of families who are taking the direct burden of this.

I know we have tried to help them with pay increases. I know we have tried in other bills to help them improve their pensions. I have been part of most of those fights. I am proud to say in most of those fights we have been successful--but not always. My question is, Why do we only have to help the Guard and Reserve or the Active Forces in the military bills, in the Defense bills? Why can't we help them in our health care bills, in our tax cut bills, in any way we can? If we can afford it, we should step up to the plate. We should step up to the plate and do it.

I think I heard the chairman of the Finance Committee say earlier this morning that he was very proud that the Vice President himself could step in, and did step in--the Vice President of the United States. I think he said he stepped in to help the negotiations on a Transportation bill so we could get highways built in this country. I hope the Vice President and the President himself would step in and say, ``We made a mistake,'' or ``We just missed the issue,'' or ``We just missed the item,'' or ``We just didn't focus on it as we should,'' or ``The House leadership didn't focus, and let us make it up. Let us put it in this bill. Let us put it in another bill to help our Guard and Reserve.''

There are many ways that this could be corrected.

I will be pleased to.

I am aware.

I do believe that.

I thank the Senator from South Carolina. I thank him for his help and support. I work on many issues with him, and he is, as a member of the Guard and Reserve, most certainly aware of these situations. I know the Senator from South Carolina is not asking this for himself because the situation with his family is probably stable and steady. I know the Senator understands that many of the men and women he serves with don't have that same kind of security.

So we are asking them to provide security for us, and we can't find the time for a page or paragraph or a letter to find security for their families. I don't understand it and my constituents don't understand it. Most certainly the men and women in the Guard and Reserve in Louisiana, 12,000 families, do not understand it.

And so I frankly do not want to go home. I don't know what I would tell them when I do go home, how we could pass a $137 billion tax cut bill and forget them. How could we possibly forget them?

I got something from Senator Dorgan which is extremely upsetting to me I will speak about later today because I plan to speak and I am going to connect these dots for people. Maybe one reason we forget them is because there are corporate network executives demanding affiliates take the name of the dying soldiers off the reports at night. That is one way Americans could forget them. We don't want to take pictures of the funerals. We don't want to put their names on the screen, so we just forget they are dying. I understand that. Maybe there are good reasons. I don't want to get into that debate because it gets us into, well, some of the families want it, some of the families don't. I understand that. But still, even if they are not being scrolled on the television, if that is not the right thing to do, surely the Senators and elected leaders who represent them do not need to be reminded by the scrolls on television of those who died.

Many of us have been over to Walter Reed Hospital and visited them personally. Do we need to be reminded? I don't think I had to go stand at the conference committee and tell Chairman Thomas. And I am going to speak later today about Chairman Thomas's district and about what his district is like, and I am sure he knows that. I have done a little research myself about that, so maybe people in his district could get word to our colleague because while it is important what we say to colleagues, what is most important, as you know, is what our constituents say to us.

How much time do I have remaining?

The third argument that I have heard from some people about why I should sit down and stop talking is because some people are opposed to tax credits. Some people don't like tax credits. Some people think it is an inefficient way to operate the Government.

I am not on the Finance Committee. All I know is when I run for the Senate and when I talk to people at home, everybody likes tax credits. I have tried to provide as many tax credits and some relief for a variety of different individuals, and all I hear every day from this administration is tax cuts, tax relief, tax credits. I hear that all the time whether we have a surplus or deficit, whether we are at peace or war, whether we need to spur the economy or slow it down. All I hear from the administration is about tax cuts and tax credits. But there are Senators who come to the floor, might come to the

floor and say they are going to oppose them because they don't believe in tax credits. So I want to put nine of the tax credits that are in this bill in the Record.

Section 221. Modification of targeted areas in low-income communities for new markets tax credits is in this bill--$1$7 billion.

Section 245. Credit for maintenance of railroad tracks. Establishes a business tax credit equal to 50 percent of qualified expenditures for railroad track maintenance, capped at $3,500 per mile. So we have a credit in here for railroads as they maintain their tracks, and we cap it at $3,500 per mile. Now some good staff person could calculate how many miles of railroads we have and figure up how much that costs the taxpayers. Maybe it is a good thing, Mr. President. I don't know. But I will tell you what would be a higher priority for the constituents in my State--to send 1 mile, 1 mile of the railroad tax credit to one family so they could pay their house note.

No. 5. Appointment of small ethanol producer credit. Provision clarifies that the small producers' tax credit flows through a member of a cooperative.

No. 6. Section 339. Credit for production of low-sulfur diesel fuel. Provides that a small business refiner may claim a credit equal to 5 cents per gallon for costs paid to comply with the EPA sulfur regulations. The total production credit is limited to 25 percent of the capital costs to come from compliance with EPA requirements.

No. 7. Section 341. Oil and gas from marginal wells. Some of these are in the State of Oklahoma, some in my State of Louisiana. It adds the marginal well production tax credit. The credit is $3 a barrel of oil or .50 percent per thousand cubic feet of gas. The credit is not available if the reference price of oil exceeds $18 a barrel. The last I checked it was $50 a barrel. So we can give tax credits to oil companies and gallons. We can't give a paycheck to the Guard and Reserve to put fuel in their car.

Now, I am obviously upset, but I am going to try to be respectful, but I have to tell the truth, and that is the ugly, unvarnished, unedited, uncensored truth about this bill, and so we are going to stay here till Thursday. I am prepared to stay here morning, noon, and night. I am going to be respectful. I am not going to get into any arguments and I am not going to raise my voice above this level. I am not going to be talked down. I am not going to be spoken down to because I am not speaking for myself. I am speaking for the 5,000 men and women who left Louisiana and are overseas, and if I don't speak for them on this floor, they don't have anyone to speak for them, so I am not leaving.

How much time do I have remaining?

So the last minute and 16 seconds that I have this morning before we vote on cloture, which I will not be voting for, I want to ask my colleagues, whatever they can do in the next 4 days to help this I would appreciate it. I understand schedules are tough, and I am not going to make a comment if no one else says anything or shows up or signs a letter because I understand we have a lot of things going on, very important things, and I would not be the least bit disrespectful to my colleagues in this Chamber. But I want them to know, my colleagues, that that is why I am here, and I am not leaving. I am not leaving this Chamber. So I want to apologize ahead of time to anyone I inconvenience. I hope they understand.

I yield back my time.

Thank you, Mr. President. May I have order, please?

Thank you, Mr. President. I am not going to speak until we have more order.

I am sorry, Mr. President, no, I won't. Maybe in a few minutes but not at this point.

As my colleagues know, we have been working toward this point, actually on this particular bill, for over 2 years, so there have been many meetings, many votes, many debates, many conferences. I understand that. I know we are to the very end of this discussion, and we have a bill before us with $137 billion worth of tax cuts. This is a bill that started out 2 years ago because of a decision by the World Trade Organization that called to our attention that our Tax Code was not in order and that if we did not straighten some things out in our Tax Code, some of our businesses could be penalized. So 2 years ago, an effort was undertaken to correct that.

Some of us, knowing that effort was going to be undertaken, crafted a provision to give tax relief to the Guard and Reserve and their families, to the members of the Guard and Reserve who are on the front line, by saying to all the patriotic companies in America, large and small: As you continue to give that paycheck to the men and women on the front line, we thank you, we appreciate that effort. We know it is difficult for you. We know it is tough for you. And we want to provide a 50-percent tax credit to you to help your Guard and Reserve to keep their paychecks whole.

Because a lot of paychecks in America are going to get fattened, a lot of dividend checks are going to be improved, and a lot of benefits are in this bill, some of us thought, and the whole Senate voted, Democrats and Republicans, that one of the paychecks we should make sure was complete and whole was for the men and women taking the bullets on the front line.

Mr. President, 640,000 men and women have been called up since 9/11, and when we called them up, they have gone.

Mr. President, may I have order, please?

Thank you, Mr. President. I know that tempers are short because it has been a difficult process, and I am trying to be as cooperative as I can. I do not mean any disrespect to anyone in this Chamber, and I do not mean any disrespect for the managers of this bill, who have done a magnificent job under very difficult circumstances, but I have, since Wednesday, been trying to make this point.

When this bill left the Senate, there was a provision that gave a tax credit to the men and women on the front line in Iraq and Afghanistan, wherever they serve, to keep their paychecks whole by giving a 50- percent tax credit to the thousands of employers, large companies and small companies, who send their civilian paychecks to the front line, not so much for the benefit of the soldiers. Many of these men and women who are fighting on the front line understand sacrifice. That is why they joined. If we understood sacrifice a little bit more in this Chamber--and I include myself. I don't understand the sacrifice, but I can tell you the men and women in uniform understand it. But this is not really all for them. It is for their families, their spouses and children, to keep that one paycheck whole.

For some reason, we passed a bill out of the House of Representatives, crafted in large measure by Chairman Thomas, that left them out. They couldn't find $2 billion in $137 billion to put in for our troops.

We have ceiling fan importers in the bill. We have the gambling industry in the bill. We have the oil and gas industry in the bill. There are many industries in this bill that are important to me. But I have confidence--complete confidence--that not one business in Louisiana, not one industry in Louisiana thinks they deserve to be in line before the Guard and Reserve and the employers that are keeping their paychecks whole--not one. If there is a company in Louisiana, if there is a company anywhere that thinks the tax credit in this bill is more important than the paychecks going to the men and women on the front line, please contact me, because I don't understand it, and maybe it is something I have missed.

I want my colleagues to know that I am only going to speak for the first few minutes, and I have an hour reserved. I am going to speak throughout the 30 hours, use a little bit of my time as we go on.

It is really not that complicated. My colleagues understand this issue. I don't think I have to go into any more detail about the amendment, what it did, how much it cost, and the fact there were 100 percent of the Senators, Republicans and Democrats, who supported the issue. It was moved over to the House. I think they understand it was the House Republican leadership primarily that crafted this bill and evidently did not think it should be included.

Let me spend a few minutes about what I am going to do so we can be clear about the schedule. I do not take this move lightly. I understand we are at the end of the session. I understand people have commitments. I understand there are elections going on. I know there is a Presidential election going on and elections for many of our colleagues in the Senate. But I am going to use all the parliamentary procedures available to me as a Senator to fight for the 5,000 men and women in the State of Louisiana who are currently activated and have gone to the front lines and don't get a whole paycheck. They get their Army or their Navy or their Reserve paycheck, but they leave a lot of pay on the table because they don't get their civilian paycheck.

Here is a tax bill that could have allowed their employer to get a 50-percent tax break, thereby encouraging them to continue that paycheck.

I am going to stand here and fight for them. I can't extend this debate past Thursday. I don't think there is anything in my power to do that. But I can and intend to use all the parliamentary procedures available to me until the

end of this debate. If I have to stay on the floor for the next 4 days, I am prepared to do that. It is with the greatest amount of respect that I let my colleagues know this.

The solution is something I have offered to my colleagues which I want them to consider. I know this bill cannot be amended. I understand that. I am not asking for that. There is a bill, H.R. 1779, that is in the Finance Committee now. Amazingly, because I didn't have anything to do with this bill, I can't believe the bill addresses exactly the same subject that I am discussing. It is a House bill that came over here from the House from the Committee on Ways and Means, the same committee that cut them out of this bill. There is another bill that came over from the Ways and Means Committee that is in the Finance Committee now. So by unanimous consent of the Senate, without even a rollcall vote, just if all the Senators in this body would agree, we could amend this provision into that bill and simply send it back to the House.

I understand I am only one Senator. I know the Senate can do its will, and we can't force the House of Representatives, but we can go on record to say, this bill is important. We can amend the bill.

I would like to spend a moment just to say what the bill is because there is a little bit of irony about the underlying bill. There is an interesting irony about the underlying bill. I will tell you who the author is in a minute. But it is an interesting bill that came over here to give the Guard and Reserve a tax benefit. The tax benefit described in that bill is to waive the 10-percent penalty for the Guard and Reserve taking money out of their IRAs so, presumably, they could pay a house note or a car note. In other words, there is a bill that came over to us from the Committee on Ways and Means to give a tax benefit to Guard and Reserve members to allow them to waive the 10- percent penalty so they could take money out of their retirement account to make ends meet while they are taking the bullets for us.

I have to hear objection for our amendment supported by many Senators, Republicans and Democrats, that would actually keep their paychecks whole so they could put some money in their IRA. What do you put in your IRA if you don't have a paycheck to put in your IRA? If anybody can explain to me what goes in an IRA other than money from a paycheck, maybe if somebody is lucky to have a dividend check or some passive investments or some capital gains, but most people I know take their paychecks and out of their paychecks, after they have paid their rent, after they have paid their car note, after they pay health insurance for their family, after they pay their food bill, after they pay their insurance bill and everything else they have to pay for, if there is anything left, they put it in their IRA. Because most Americans I know try to do their very best to manage their money.

So I have to have the insult of having the House send us a bill saying they want to waive the 10-percent penalty for the Guard and Reserve, but they won't help put an amendment on to give them a full paycheck so they have money to put in it. This Senator finds that quite obnoxious.

The irony of it is unbelievable. I asked the staff, go find me any bill, any Finance Committee bill that wouldn't get blue-slipped. They came back and said: Senator, you will not believe it; it is a bill about the IRA.

No, I will not yield.

So we have this bill that is over here. All I have asked my colleagues is this. As the leader knows, I am not even asking for a record vote. Even though I think our guardsmen and reservists deserve a recorded vote, because I think we should go on record, but I am not even asking for that. I am asking for a voice vote--a voice vote, not a recorded vote--to take that IRA bill, put this amendment on it and simply send it back to the House. This filibuster will be over. That is all I am asking.

Let me say one other thing. I am not opposed to one item in this bill--not FDA, not the pork issue.

I have tried to be respectful of other Members. I would ask that same consideration.

I am not opposed to any provision in this bill. There is $137 billion in this bill. This bill was supposed to be about $50 billion. Of course, when you open a tax bill, everyone in America would like to be in it. They have done a good job because everybody is in here. The only people who are not in here are the men and women taking the bullets on the front line. Six hundred and forty-three thousand Americans on the front line, and we couldn't find one page, not one line, not one paragraph for them. This is disgraceful.

It is not our fault. The Senate did not do that. But somewhere between the Senate and the House, the papers got lost. I don't know why they get lost. I don't know why we can't remember them in the tax bill because we sure remember them in photographs. We sure remember them in the parades. We sure have them all over our ads for those running for office.

I am not up for reelection now. I will be up for reelection in 4 years, and I am certain I will hear from every industry in here about how I didn't help them with their tax credits. I will say it again. I am not opposed to any tax credit in this bill, not one. What I am objecting to is how we could, in the middle of the war, with no end in sight, no real plan for the peace, no understanding of when our troops might get home, no understanding of how long they are going to have to be there, we cannot keep the paychecks going to their families.

When is somebody going to tell me we don't have enough money? What is this? This issue is not complicated. This is very simple. That is why people are responding because it is not complicated. I am trying to explain to my colleagues that it is very simple. I am not even asking for a record vote. I didn't want people to stay here until Thursday. I have 2 children; one is 12 and one is 7. I have had to make arrangements for the next 4 days for them and for my husband. I understand that. I have canceled everything on my schedule. I am not looking for awards or sympathy. I am not asking for anything unreasonable. If these guys can go to the front lines and leave their families for a year or 2 years, can't I stand here for a few days? Can we not work for a few hours to try to voice vote, in the air- conditioning of this building, and send this bill back over to the House and mark it up as they just were not clear about what they were doing? They just didn't realize what they were doing? When they come back in November, they can fix it. That is all I am asking.

One more thing about the tax credit, and then others may have questions. Maybe I haven't been clear. Here is the list of the tax credits. The only arguments I have heard against what I am trying to do are two. One was given by one of the House Ways and Means Committee members when I called to let them know ahead of time I was going to do this. I tried not to surprise anyone. I called them as soon as this bill was printed and came here Wednesday. I called members of the Ways and Means Committee and asked them: What could have possibly happened?

The only comment they gave back that was reported in the newspaper was the House did not like our offset. Forgive me, I am not a member of the Finance Committee. I don't know all of the details about offsets. I don't think our Guard and Reserve know about offsets. I don't think the people we represent know about offsets. But I will tell you, somebody in this Chamber knows about offsets because there is $137 billion worth of offsets right here. Did anybody think we could find $2 billion for them? So I am sorry I am not an expert in offsets.

The only other argument I have heard from anybody--maybe there are others and I haven't heard them, and I have been here 3 days--is I don't think we should have tax credits in this bill. Somebody might object philosophically to tax credits. That surprises me because, from the day I got to the Senate, all I have heard from the Republican leadership is tax credits, tax cuts, tax relief. If they don't say it a thousand times every day, it is amazing. Just tax credits, tax relief for everybody, whether we have money in the Treasury or not. That is all I hear about. So it is amazing to me that someone could say we don't like it because, technically, it is a tax credit.

Let me read the nine tax credits that are in the bill. I want the Guard and Reserve to listen; they got left out. I

will tell you the ones in this bill. Section 221: There is a modification of targeted areas of low-income communities for new market tax credits. That is probably very good. It is for new markets. I am sure it will help everybody in low-income areas. I think that is great.

Section 245, credit for maintenance of railroad tracks: It establishes a business tax credit equal to 50 percent--Mr. President, I am losing my voice having to speak over the conversations.

No, I will not.

Section 245, a credit for maintenance of railroad tracks, establishes a business tax credit equal to 50 percent of qualified expenditures for railroad track maintenance, capped at $3,500 per mile. Maybe there is a staffer or somebody who can calculate how many miles of railroad tracks we have and multiply it by 3,500 because that is a tax credit that is in this bill. We may need to do that. I have tons of railroads running through Louisiana, but not one railroad company in this country thinks their tax credit should come before making the paychecks of the Guard and Reserve whole.

Biodiesel income tax credit: Provides a 50-cent-a-gallon income tax credit similar to the present law ethanol benefits for each gallon of biodiesel used in the production of a qualified biodiesel mixture used or sold as fuel. I am fine with that, but you would think the tax credit some of us had and thought was important, which gave them a paycheck so they could buy gas, is equally important to this.

Section 339, credit for production of low sulfur diesel fuel; section 341, oil and gas for marginal wells--I know in Oklahoma they have a lot of marginal wells. I have some in Louisiana myself. I am very aware, as a member of the Energy Committee, of the importance of this tax credit, but again, not before the men and women taking 100 percent of the bullets.

Expansion of credits for electricity produced from certain renewable sources and then certain business credits allowed against regular minimum tax.

This is what I was given this morning. Perhaps there are more. I know these are nine tax credits in the bill. The rest of this bill has to be something else that they don't call tax credits. But it is tax benefits. I am not sure I know the title of it. Maybe I am not exactly correct. But these are the tax credits, which is the same thing I asked to be in this bill, and many of us asked, and it was left out by the House Republican leadership.

So, again, I am prepared to stay here until Thursday. I am not going anywhere. I am only asking for a voice vote--not a rollcall vote--on a bill that is already over here, that is already in our Finance Committee, to put this amendment on and send it back to the House. Then we can all go home and talk about it and we can say we supported it, which we did, and we did a great job, and then people can talk to House Members about are they going to accept this bill or amend this bill or kill this bill. Let the House Members answer that question.

All we can do here is take care of the Senate's business. This is the Senate's business, Mr. President. If we don't stand up for these guys and gals, if we don't fight for their families, who is going to fight for them?

Let me ask the Chair how much time I have remaining?

Mr. President, I think the Senator from Florida might have a question.

He is asking a question.

I thank the Senator from Florida for his comments, and I would be happy to answer his question because he is exactly correct. All members of this Chamber are aware that since 9/11, 640,000 guardsmen and reservists have been called up from Florida--and I see the Senator from Arkansas--from her State, other Senators who are here this morning and will be here through the debate--from all of our States. The Senator is absolutely right. The large measure of the burden has been placed on them and their families. The Senator from Florida knows they do not ask for much. These guys and gals are used to sacrifice. They do not ask for much and they really do not like to complain. They are the last ones to stand in line and come ask to be included in this bill, but we should ask on their behalf. That is why this amendment is so important.

If we were not passing a tax cut bill and we did not have any money to give anybody credits or tax cuts, then they would be the first to say: Please do not include us. But how can we, in good faith, stand here and pass a $137 billion bill and leave them out and leave out their employers, small businesses from Florida, Arkansas, and Louisiana that are digging deep, sending that paycheck to the front line even though the man or woman is not in the office or in the manufacturing plant, trying to help their families? Surely we could have found some room in this budget for them.

I thank the Senator for the question.

Yes, I would.

The Senator from Florida raises a very good question to me, and the way I would like to answer that question is with an e-mail. It is wonderful that I received this e-mail this morning. I have received hundreds of e-mails from families all over the United States who have been keeping up with this issue, but because this answers the Senator's question--this is from Bossier City, LA, and he writes: First, I would like to give you a little background on myself. I was raised as a military brat. My father served in the Air Force for 28 years, and we were stationed at Barksdale Air Force base

three times. He and my mother retired in Bossier City. We had a good life growing up in the military, and in my opinion it brought us closer together as a family, but there were many, many, many times when things were tough financially for a family of five. I watched you today on C- SPAN, and I was proud that you have represented us and our State and our military families. I think it is extremely important for funding to compensate our military families, especially now when there are no clear answers on how long our troops will be required to be in Afghanistan and Iraq. I have many friends whose spouses have lost significant amounts of income due to activism. Not only do they worry about their spouses on the front lines, they have to worry about how to make ends meet here in the States. Please keep fighting for their cause. By the way, this should not be a Republican versus Democratic issue. My parents are conservatives and I am a liberal, but we consider this matter a matter of patriotism.

I say to the Senator from Florida and other Senators, I have received hundreds of e-mails just like this, and so I want to make one more point. I do not think this is a Democrat versus Republican issue. As I said, the amendment we are fighting for already passed the Senate by 100 votes. The Senator was a cosponsor. The Senator from Arkansas was a cosponsor. I see other Senators in the Chamber who were cosponsors. We wanted this amendment in the bill, and it was in the bill. It went over to the House, and in the negotiations it was dropped. My question is, why? How could we afford to give a tax credit to everybody else but not the Guard and Reserve?

I thank the Senator for his question. I will yield for another question in a minute but to the point in answering the question: This is a page out of the handbook that the Guard and Reserve receive from our Government. This is the handbook they receive, ``Family Readiness Paradigm.'' The center of this says ``self-reliant families.'' ``Self- reliance'' is a powerful word. I like to think I am self-reliant. I like to encourage my children to be self-reliant, self-sufficient, independent, hard working. So we send out a memo just to sort of reinforce to our Guard and Reserve that we expect them to be self- reliant. We provide reunions for them. We help them with their deployment, tell them what is going to happen. We try to help them set up health care plans. We arrange telephone calls. We do the training and mission. The only thing we do not do is send a paycheck.

Then we have the President saying:

The National Guard and Reserves are a vital part of

America's national defense.

[They] display values that are central to our Nation:

character, courage and sacrifice, [and demonstrate] the

highest form of citizenship.

And while you may not be full-time soldiers, you are full-

time patriots.

Evidently, they do not deserve a full paycheck?

No, I will not yield. I am sorry.

That is what the argument is about. Again, I am not asking for a rollcall vote. I know this bill cannot be amended. It is against the rules. There is nothing I can do to amend it. But the bill that is right now before the Senate, I am asking our leadership--I am asking my colleagues to please join with me; I know many do, but I need everybody, I need 100 percent--to agree to amend this bill and send it back to the House and give the House time to reconsider this position. I am fairly certain they did not know the specifics of it. I am going to give them the benefit of the doubt. I do not know that they specifically looked at this and said: These people do not deserve it. I do not think that happened. All I know that happened is that it came back without it in it, and we have time to fix it. We cannot fix it today, we cannot fix it tomorrow, but if we send a bill back to the House, whenever the House comes back, in October, November, December, or January, they could fix it.

How much time do I have remaining?

I will yield to the Senator from Florida and then perhaps to the Senator from Oklahoma at a later time.

I thank the Senator and will respond to his question by saying: Yes, in this amendment, besides what I have described, there is a portion of the amendment--that was actually led by Senator Boxer-- that would allow this tax credit to be applied by local governments to try to keep the paychecks whole for firefighters and police officers who have gone to the front line.

Think of the irony. The Senator from Florida understands this issue well. In the case he described, a firefighter who fought the fire in New York on 9/11, maybe one who went up into the building, put his life on the line or her life on the line on that day--and we know what happened. We don't have to go back and replay that memory in our head. Then he is in the Guard or Reserve and he signs up to go to Iraq to fight, to take the bullets. Because we left this amendment out, he has to send his family back half a paycheck, and we can't find the money in this bill, $137 billion, to help them keep that paycheck whole? It is a disgrace. It is shameful. It is unjust. It is unconscionable. That is why I am going to stay here until Thursday. I understand it may not work. I understand the session may adjourn. But it is going to adjourn with me speaking about this, and I hope all of us, saying the Senate has already spoken on this. Our leadership, Republican and Democratic, said if we are going to have a tax bill, a tax cut, a tax break, the Guard and Reserve should be a part of it.

If we could find other things to help, I am happy to do that as well. I put this particular thing together with some of us. There are many other items I am sure could be put in a comprehensive package. In fact, I have spoken to many of the colleagues who have said to me: Senator, we could put together a more comprehensive package. I am working on that with them as well. However, there is no reason and no excuse and nothing anyone can say to me to convince me that before we adjourn we should not take the action, with not a rollcall vote but a unanimous consent, and at least send this bill back to the House. Then we will have all the time in the world--October, November, December, all next year. I am going to be here at least 4 more years unless I get recalled. My election is not up for 4 more years. I will work on it with anybody who wants to for the next 4 years and come up with a comprehensive package. I know that.

But I want the Senator from Florida and the Senator from Mississippi to know, we don't have to wait for a comprehensive package. We don't have to have it all neat and pretty. We don't have to have a commission that could decide let's do this and let's do this. This is what is before me right now. This is what is before me--$137 billion of tax cuts, and not one page, not one paragraph, not one tittle, not one scribble for the Guard and Reserve.

No, I will not.

So that is my issue at this moment. I am hoping to put a package together. I don't expect this bill to be amended. But I have asked the leadership to allow a unanimous vote--not even on the record--to put this Paycheck Protection Act on the IRA.

How do you have an IRA without money to put in it? I don't know. So it makes sense to put my paycheck bill

with the IRA bill, so then they could actually have an IRA to take the 10-percent credit if they had money in it. You can't get the 10-percent credit unless you have money in your IRA, so this matches pretty perfectly. You get the paycheck, put the money in your IRA, take the IRA out, and you don't have to pay your 10-percent penalty. That would be terrific.

Then on that bill, also an amendment, there is a possibility there could be some hurricane relief. But I want to be clear about one thing. I didn't ask for that although my State will benefit from it. The Senators from Florida, Senator Graham and Senator Nelson, rightly led that. I am a cosponsor of that. That would fit nicely on that amendment. We have to give help to the hurricane victims as well. So we have the Paycheck Protection Act. We have the hurricane help.

Right now, as I speak, I have flooding in my State. I woke up this morning and turned on the television and, besides seeing Donald Rumsfeld in Afghanistan, the next I saw was a levee break in Louisiana. So there is money in this tax bill that I am talking about to help Florida, Mississippi, Alabama, and everybody who is flooding, help this paycheck protection, and do this IRA provision which, again, was not my idea but I support it. I think it was a good one.

All I need is for 100 Senators to say it is OK. Evidently I don't have 100 Senators. I might have 98, 99, 89. We don't have a rollcall so I don't know. All I know is I don't have 100, because if I had 100 this filibuster would be over. So that is where we are.

I will yield to the Senator from Florida and then the Senator from Oklahoma, after one more question from the Senator from Florida.

Thank you. That is actually the question of the day. It may take all day or tomorrow to get the answer to that, but I don't know the answer to that. Maybe some Senator could give us the answer to that. I do not know why, but that is what this debate is about.

Is there any compelling reason we could not do that, end this filibuster, move on? These bills are very important to do. I am not objecting to anything in this bill. I am not objecting to anything in the military construction bill. I am not objecting to anything in the intelligence reorganization bill. Surely there are things in here I don't particularly like, but that is the process. That is the process. I cannot write this bill perfectly. There are things in here my constituents would find absolutely laughable. But I have to tell them we have to laugh sometimes, that is the way it is. That is the process. I have been a legislator for 25 years. I know the process. But this is more than process. This transcends all issues, in my mind. This is about whether this Senate, Republican and Democratic leaders, will stand up for the men and women on the front line--yes or no.

It is as simple as that.

Yes.

I would like to respond this way. I have the greatest respect for the Senator from Oklahoma. I actually like him very much. He and I have worked on some important issues--the issue of child welfare, adoption, foster care. I respect him as a Member who understands the details of the finance and tax system and the Budget Committee. He chairs the Budget Committee.

All I can say in answer to that is we drafted the amendment as carefully as we could to make sure that, in fact, that happens. I assure him that there are people wiser than myself, smarter than myself, who have worked here either as a Member or a staffer who could carefully craft such an amendment. I know they crafted this whole entire bill of 600 pages to help the railroads maintain their tracks, for ceiling fan importers so they can keep the fans on, but the troops in Iraq can't afford a fan. Their families can't buy one.

The Senator can talk about whatever. I am respectful of his question. I am completely convinced that the amendment could be written in such a way.

Does the Senator have any other questions?

The Senator's first question, in my opinion, doesn't have a lot of merit. The second one does have a lot of merit, and I would like to respond to it.

There is an argument that comes out of the part of the Pentagon, not the whole Pentagon. There is something unsettling to a man on the front line, some active and some Reserve, when both are driving in a truck in Iraq, that they should get the same paycheck. They both should get $30,000 no matter what. No matter if the reservist makes $70,000 in the United States in their regular work, when they drive the truck in Iraq they should make $30,000. I don't hold to that position. I will tell you why.

Our Government benefits significantly financially, and the taxpayers benefit by not having to keep that Guard and Reserve full time, 24-7, year after year after year. We benefit as taxpayers, so we have more money to give out in tax cuts to everybody else. We benefit by not having to keep a force. We have 1.6 million Active-Duty, and we have 1.2 million Guard and Reserve who are now 40 percent of our force and growing every day. You can see during World War II, in the 1940s, we called up everybody. We had to fight the war. We called up everybody who would go, and even those who didn't want to go because they were forced to go under the draft. Our Active Forces are down at the lowest level since 1941.

I hope everybody can see this. Our Active Forces are down to their lowest level since 1941. You know who makes up this gap? After the terrorists attacked the World Trade Center and we are in a war, do you know who makes up this gap? The Guard and Reserve. They go to the front lines.

All I am talking about is since we asked them to go, just let their paychecks follow them by giving a tax credit to the thousands of businesses, large and small, in this country that are doing the patriotic thing, as acknowledged by our President and our

Secretary of Defense and the leadership. Can't we give a tax credit to keep their paychecks for their families? This isn't for the soldier. This is for their families. I think the men and women, active, traditional units, understand that. They get health benefits. They get other benefits when they are Regular Army or Reserve. The reservists don't even have a matching 401(k) savings plan. The reservists don't even have TRICARE. The reservists have very little, and we are blocking them from keeping the one paycheck they do have.

Some Senators don't think they should be able to get the employers' tax credit to keep bread on the table and keep their mortgages paid. This is the issue.

I understand the Pentagon disagrees with that. I understand their position. I don't agree with it. I think, yes, we should pay a differential, or at least allow reservists, when they go to the front lines, to keep as much of their pay as possible, even if they are in a fox hole next to a 10-year, full-time Army soldier. The full-time, traditional soldier gets other benefits and other compensation. They might get free housing. They understand that.

I think the active Army and the active military support this amendment. I am convinced of it. They are not jealous about the Reserves.

For one more question.

I would like to answer the question. First of all, the Senator has drafted many amendments in his career. If he wants to help me modify this amendment, I would appreciate his help. It clearly is my intention to get this direct tax credit in a way that makes sure that these companies can take tax credits for the Guard and Reserve.

If we can write $137 billion worth of instructions to other companies about how this would apply to their tax credit, we could most certainly write a law or rule that allows these companies to be able to cover the paychecks, which they are doing already. This is totally voluntary. These companies don't have to do it. But if they are going to do it-- some in Oklahoma and some in Louisiana are digging deep--they have budgets to meet. They are paying the guys on the front line and then paying to replace them in their offices.

I will tell you why I don't want to put it on the Armed Services bill. I see the chairman on the floor, the Senator from Virginia. What happens is--and the Senator from Oklahoma knows this--under our rules, the Defense Department gets just so much money. Why should I ask my soldiers to make a choice: Do you want a paycheck for your wife, or do you want a covered Humvee for your battalion? I am not asking them that question. You might want to; I am not. Do you want a paycheck for your wife, daycare for your children, or do you want a covered Humvee for yourself? How would you like to answer that question? That is why I object to putting it on the Defense bill.

This is a tax package bill. I don't have to take one Humvee away from them. I don't have to take one rifle away from them, or one helmet away from them. All I have to do is put them in this bill. And I am going to stand here until 100 Members of the Senate agree to do it, and if not we will be back here next year.

How much time do I have remaining?

I will reserve the remainder of my time.

I yield the floor.

Will the Senator yield for a question?

I yield myself as much time as I may consume.

Mr. President, there are several antifraud provisions in this conference report. Most of the focus in the media has been on the tax benefits of this legislation, but an extremely important aspect of the bill is how it closes giant corporate tax loopholes. This legislation, by closing them, obviously is going to bring revenue into the Federal Treasury that is otherwise just going into the treasuries of corporations.

This legislation includes Enron reforms that Members have been pushing for since Enron was exposed 3 years ago. Don't forget, for about 5 or 6 years before that, before the year 2001, Enron was doing their dirty work. But we finally got it exposed in 2001, and we have been taking some corrective action through corporate governance policies already passed by the Congress, and now we are taking action to close the abuse of the Tax Code by Enron-type executives.

It is a little ironic that many of those same Senators who have demagogged the Enron scandal are now opposing this bill. They seem to be more interested in something that is not in this bill than the very good public policy of cracking down on fraud that is actually in this bill. I am proud of the fact that many of these antifraud measures in this report stemmed from cases that were investigated and exposed by the very capable staff of the Senate Finance Committee. With that staff working for me and staff working for Senator Baucus, along with various whistleblowers and informants, and now with the House of Representatives passing this bill, we are about ready to shut down these Enron-type corporate tax abuses.

This has not been an easy process, but it is a real example of how our perseverance pays off. Back in July of 2001, the Finance Committee staff first discovered what has become known as a huge fraud upon the taxpayers, and that is the fuel tax evasion. This fraud is costing the taxpayers at least $10 billion. So, No. 1, Enron-type fraud, abusive tax shelters; now we are talking

about fraud that comes from people not paying the fuel tax on gasoline and diesel fuel that would be then spent on the highways.

The Finance Committee had a very important hearing exposing this type of fuel fraud tax scam. The problem has come to light in more recent prosecutions. One involved an alleged terrorist cell that was skimming off fuel and selling it, using the money for God only knows what. It could have found its way into terrorist activity against the United States.

In another case, in July, prosecutors charged 19 workers at the Miami International Airport with falsely classifying jet fuel as contaminated to avoid paying the fuel tax. They would then sell it on the sly, stealing 2.7 million gallons of fuel.

Another tax scam that my staff uncovered involves what is known as service-in/lease-out, or SILO. These schemes were discovered by a Finance Committee major hearing, showing these fraudulent arrangements are put together by high-priced lawyers and accountants. In these scams, companies actually lease public works systems such as subways and sewers from cities, and then turn right around and lease them back to the same cities. The cities get upfront money, presumably under the argument that their municipal treasuries can use it, particularly in times when the economy is down. But here is what happens: The cities get a little bit of upfront money, but the companies get millions of dollars of tax writeoffs. So the taxpayer is left holding an empty bag under this scheme.

That sounds unbelievable, doesn't it? But it is true. The bill we are about to vote on puts a stop to this and saves the taxpayers over $27 billion.

Let me also note that we have provisions in this bill that address other abuses, significant abuses in the donation of intellectual property, as well as the donations of cars.

Corporations have been reducing their tax bills by hundreds of millions of dollars each year by taking intellectual property of little to no value and donating it to charity. This legislation ends this abuse by corporations while still encouraging the donation of legitimate intellectual property that has real value for actual development.

We also ended the shady tax practice of people providing some junker cars to a charity and claiming thousands for it off their individual income tax.

The reforms in this legislation will place no additional burden on the donor, will not reduce the amount going to charities from the donated car by a single dime, and will benefit all taxpayers by ending this abusive scheme.

There has been noise coming from a few that this reform shouldn't have been done on this bill. A lot of that noise is not coming from charities but from middlemen who are the ones who really make the profit off of this abuse.

To say we should have delayed this is nonsense. As my comments highlight, it is very difficult and also uncommon for us to have a legislative opportunity to address tax shelters and tax abuse.

This bill provides the most sweeping attack on abusive corporate tax shelters in an entire generation of this Congress. So we cannot pass up an opportunity to address an abusive corporate tax situation. It can very well be years before another opportunity presents itself to the Congress to deal with the problem of people not paying their fair share of taxes. Forget about the word ``fair share''--just say paying taxes that are due.

These efforts to address abuses in charitable donations are part of an ongoing bipartisan Senate Finance Committee review of nonprofits, something the Democratic ranking member, Senator Baucus, and I are working on together.

I anticipate we will be addressing other areas in the future such as land donations and facade donations based on our investigations of the Nature Conservancy and other land donation organizations.

But I do want to say, since I named some of these organizations, that I think some of these organizations have gotten the message and are making attempts to correct some of the deficiencies in their own operations that abuse the Tax Code.

I am very pleased that in this bill we deal with a situation where executives take corporate aircraft for personal travel. Legislation in this bill will put significant limitations on corporations being able to write off such high living.

Again, based on the work of the Finance Committee, we were able to ground a good number of these high-flying corporate executives. The Finance Committee initially placed limitations to deal with abuses that were seen in the Virgin Islands and other U.S. territories. There were many people going down there to the Virgin Islands to not only get a tan but also to avoid the taxman.

I am pleased that, working with Treasury and working with the Ways and Means Committee of the other body, we were able to further tighten these limitations to address the tax problems we are seeing down there in the sunny islands of the Caribbean.

Finally, I am glad that in the conference committee we were able to adopt the Finance Committee's proposal championed by Senator Nickles to end the SUV deduction for businesses. Senator Nickles also was right when he said it would be an embarrassment if we couldn't deal with this abuse, and we did. That is around $50 billion of fraud which the Finance Committee uncovered, pursued, and that is in this bill. That doesn't count the billions of dollars which I considered abuse but which the House of Representatives must not have considered abuse because they wouldn't agree to putting it in this bill. But I am going to continue to deal with corporate abuse.

I made this statement to the leaders of the Ways and Means Committee in our conference committee. I offered amendments to go further than this conference report goes. The House conferees refused, but I made clear that where these corporate abuses aren't adequately handled and dealt with in this conference report, that come January I intend, if I am chairman of the committee, to pursue more closing of corporate tax abuses. If I am not chairman, Senator Baucus will be chairman, and I think, although I shouldn't speak for him, he is as committed to this as I am because we have had 2 good years of working together on this issue.

The taxpayers are getting their money's worth out of this Senate Finance Committee. They are entitled to get more of their money's worth out of Senate Finance Committee when we continue to clamp down on these corporate tax abuses.

The Constitution may say that revenue measures have to start in the House, but the fact is, they are being created in the Senate by closing loopholes and cracking down on fraud and abuse.

I thank the House of Representatives, and particularly the cooperative working arrangement we had on this conference report with Chairman Thomas of the House Ways and Means Committee in getting as far as we have in closing down these corporate tax abuses.

The Senate Finance Committee has been so successful in rooting out tax fraud. We have more and more information coming to us over the transom about newer, more crooked and creative scams being cooked up out there in the underworld of tax shelters. All I can say to this underworld is, watch out, because we are coming after you.

I yield the floor.

The Senator from Ohio is yielded 10 minutes off the time which I have remaining.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I yield myself such time as I might consume.

Mr. President, for this entire year I have come to the floor many times to tell my colleagues all the reasons this conference report is a must-pass piece of legislation. I have talked about trade and I have talked about tariffs. I have talked about the necessity of stopping outsourcing, lowering the cost of capital to our corporations so they can be more competitive in international competition, keeping jobs in America, reducing that cost of capital, as this bill does, by reducing the corporate tax rate for manufacturing in America--a direct incentive to produce here rather than producing overseas.

Now, that is what the main part of this bill is all about, but it has some other aspects to it. I want to talk about $24 billion--$24 billion--that may be gone forever if we do not pass this bill; $24 billion to go into the highway trust fund. I do not serve on the committee that expends the money from the highway trust fund. I do serve on the committee, the Finance Committee, that provides how much gas tax we should have and other moneys that go into the highway trust fund. But for those who do deal daily with the highway trust fund, this $24 billion is the biggest single increase in highway trust fund income in over 6 years.

Now, where does the $24 billion come from? It does not come from new taxes. Instead, we overhaul an outdated excise tax system to address our Nation's increased use of renewable fuels, such as ethanol.

In addition to overhauling the excise tax system that is outdated, we crack down on big-time fuel fraud to make sure that bad guys are not robbing our States of their much-needed highway money. But the only way we can get all of that money is if we pass this bill, and do it right now, because that will bring $24 billion into the trust fund--the only way.

You have to put the money into the trust fund today to build roads tomorrow. And you cannot start collecting any new money until we change these outdated rules that keep this $24 billion from going into the road fund. All of the Senators who are filibustering this bill are costing every State new highway dollars.

To put this in perspective, my home State of Iowa, as an example, under this bill could get an additional $900 million over 6 years, but only if we pass this bill this year. So anybody from the State of Iowa voting in the Congress of the United States ought to know if they vote no on this bill that they are costing the State of Iowa $900 million. Even if we postponed the rule changes until we pass a highway bill now, which is not going to be passed until next year, Iowa will still lose $140 million forever--never get that back.

How many roads can Iowa build with $900 million? How many bridges can we repair with $900 million? I do not know why any Senator would jeopardize the safety of every citizen in his State by failing to pass the highway trust fund.

There are other Senators who do not want to put money in the bank today so we can build the roads for tomorrow. Every Senator, of course, has their right to vote as they please, but every State also has the right to know what that vote will cost the highway bill and what it will cost their State.

Let's look at California. They are going to be big winners in this VEETC and fuel fraud reform that is in this legislation. The estimated increase in California's highway revenue is over $2 billion--$2 billion of new highway money. But the only way to get the full benefit of the estimate is to pass this bill now. So I would ask the California Senators to look at this legislation, put the money in the bank today, and then build roads tomorrow.

Illinois would be a big loser if Members of that delegation would vote no on cloture and no on this bill. The Illinois Department of Transportation knows exactly what they would lose if this bill does not pass. It is close to $3 billion. That $3 billion can be put in the trust fund today to build roads tomorrow.

I would hope no one comes whining to me as chairman of the Senate Finance Committee next year that we do not have enough money to fund the highway bill, especially when you have an opportunity--right here today--handed to you on a silver platter to put $24 billion into the highway trust fund, more money for your States. And you ought to consider that not a silver platter, you ought to see that as some sort of a golden platter, a golden opportunity. But we have Senators who are bound and determined to deny every State department of transportation $24 billion. We never get an opportunity like this to put a package of highway funding together. We may not get this opportunity again.

Vote no today, and every road, bridge, highway construction project is cheated. Vote no today and every highway job not only next year but until the year 2010 will be in jeopardy, running short of money. I do not know if we can ever get this kind of funding package put together again.

Let me suggest to you how tenuous it was on aspects of this. Disagreements between me and the House of Representatives a year ago last summer--not differences involving Democrats and Republicans, differences involving Republicans, between me and the House of Representatives--to get this put together so this money would come into the highway trust fund, so we would take care of this issue of fuel fraud.

The Vice President of the United States intervened to bring a compromise together a year ago last June because, quite frankly, I thought a year ago now we were going to have the highway bill passed, and this was going to be part of the highway bill, to bring this $24 billion into this road fund. You do not get opportunities like that very often. You do not get strokes of luck like that very often to get to where we are today.

Now, the other thing about being where we are today is this bill before us is not a highway bill. The highway bill should have passed, but I guess now it is going to go over until next year. That is not in my area of responsibility, so I am anticipating what other Senators would tell you. But we have the good fortune of people looking very broadly at what is good for America or not good for America, and feeling that this provision of $24 billion into the highway trust fund so we do not lose this revenue--and we have already lost some--we have this opportunity now. We can do it in this JOBS bill as opposed to the highway bill so we don't lose that revenue.

One other thing that is in dispute is why we don't have the regulation of tobacco in this bill. I don't know how the Senate Finance Committee that deals with taxes and trade and Medicare and Medicaid and Social Security and welfare and pensions and Customs and the IRS, all of those things, how we get saddled dealing with an issue that belongs in the Committee on Health or the Committee on Agriculture. But we got it dumped on us.

I don't know why the Health, Education, Labor Committee that has this in their jurisdiction, particularly when Democrats are complaining about it not being in this bill, couldn't have passed that in the year 2001 and 2002 when they controlled that committee. But, no, they dumped this on us. Anyway, we have to deal with it, and it is not in there. It makes some people mad, both Republican and Democrat.

I want everybody to know, even though it should not have been in this bill, I voted for it on the floor of the Senate to hasten this bill along, to put it in here, and I offered it to the House of Representatives that it be included. I didn't offer it; one of my colleagues offered it. But I supported my colleague because I thought regulation of

nicotine was legitimate. Now it is not here, and we had a lot of speeches last night and today about it. So I want to speak about that.

I voted for this despite the growing problems that are coming to light about the FDA falling down on its current responsibilities. And my investigative staff has been in the middle of that, of buyouts, as an example, trying to get the FDA to recognize that their scientists are trying to tell us there is some danger out there. And they won't listen to them; in fact, they tried to suppress it. Or antidepressants, as in the case of the FDA scientists raising questions about that and being stomped on for a year until finally the study committee studied it and voted 15 to 8 that there ought to be a warning put on antidepressants for children because they are committing suicide. Yet people want to put more on the back of FDA when they have problems there.

Anyway, that is a whole other issue. The FDA has come under investigation, including my own that I have just talked about, involving Vioxx, as we have been reading about within the last week. It was revealed by my Finance Committee staff that it looked as though the FDA pressured employees to suppress negative findings regarding Vioxx.

In today's paper, we read about what looks like the FDA falling down on the job in regard to the flu vaccine crisis.

So, I hope some around here aren't trying to mislead the American people into thinking that FDA regulation is some kind of panacea for smoking.

I heard one Senator from the other side say that we sided with the tobacco companies when the FDA provision failed. Well that is interesting. That is surely what opponents would like you to think. But, there is a dirty little secret involved here. Or, at least it is a secret vis-a-vis the public.

The fact is, the tobacco companies are divided on whether there should be FDA regulation. In fact, the largest tobacco company actually supports FDA regulation, and has been lobbying heavily and pouring money into the effort to get it.

Why? Well, for one thing, a great deal of its business is overseas, and it will therefore be immune from FDA regulation. This will give it a competitive edge against its competitors. So, the tobacco companies, or at least the biggest one, is much more in favor of FDA regulation than against it.

Therefore, anybody trying to frame this as tobacco versus kids, or tobacco versus health groups, is just flatly misleading the public.

But, even for those of us who pushed for FDA oversight, our legs were cut right out from under us during the negotiations. And guess who cut the legs right of from under us? The leadership of the Democratic Party cut the legs right out from under us. That's who.

The leader of the Democratic party, Senator Kerry, went down to North Carolina to talk to tobacco farmers. Guess what he said. He said he'd support a tobacco buyout with or without FDA regulation.

So, it looks to me like the senior Senator from Massachusetts didn't communicate very well with the junior Senator from Massachusetts--or vice-versa.

Moreover, we had the Democratic Senate Campaign Chairman saying the same thing last week. He said he didn't need FDA regulation with a tobacco buyout.

And, he even had his candidate for the North Carolina Senate seat up here lobbying right over in the conference committee room to get this buyout through, with or without FDA. Can you believe that?

And, to add insult to injury to the Democratic Senators from Massachusetts, and Iowa, the Senate Democratic Leader even signed the conference report.

So, obviously, when the House leadership knew the votes were there in the Senate for a buyout without FDA, they weren't about to agree to it in conference, and there's no way we could have successfully pushed it.

Now, what more does it take from their own leaders to undermine what the Democratic Senators from Iowa and Massachusetts wanted to do? Seems to me they need to get their own house in order before criticizing others.

Does that mean all the time we had remaining on this side?

I thank the Chair.

Mr. President, I yield the Senator from Oklahoma 5 minutes.

I would be glad to entertain a question from the Senator from Pennsylvania.

That seems to be an accurate interpretation.

As I read the statute, a 35 percent rate is assumed to apply only when a financial statement fails to show earnings permanently invested outside the U.S. but also includes an amount of tax liability attributable to such earnings. I believe that the formula is intended to produce an amount comparable to what would have been shown if the amount of earnings permanently invested offshore had been set forth on the financial statements. One shortcoming of the formula, which you have identified, is that the financial statements only take into account the incremental U.S. tax liability that would be incurred if the company repatriates its earnings, which would be the 35 percent rate reduced by any foreign tax credits. I think you raise a very good point that Congress should revisit in the future. In the meantime, I encourage the Department of Treasury to consider issuing guidance that permits taxpayers to more accurately reflect the actual amount of earnings permanently invested offshore.

Mr. President, I would be glad to take a question from the ranking member of the Finance Committee.

That is correct. No negative inference was intended.

The Senator is correct. The conferees are acting to make it clear that attorneys' fees and costs in these cases are not taxable income, especially where the plaintiff, or in the case of a Qui Tam proceeding, the relator, never actually receives the portion of the award paid to the attorneys. Despite differing opinions by certain jurisdictions and the IRS, it is my opinion that this is the correct interpretation of the law prior to enactment of Section 703 as it will be going forward. In adopting this provision, Congress is codifying the fair and equitable policy that the tax treatment of settlements or awards made after or prior to the effective date of this provision should be the same. The courts and IRS should not treat attorneys' fees and other costs as taxable income.

As I stated in my May 12, 2004 press release summarizing this and other provisions passed by the Senate as part of S. 1637.

Tax relief gets the headlines, but part of tax relief is

tax fairness. It's clearly a fairness issue to make sure

people don't have to pay income taxes on income that was

never theirs in the first place. That's common sense.

Section 703 will help in well known cases, such as that of Cynthia Spina, an Illinois police officer that secured a settlement in a sexual discrimination case that left her owing $10,000 or more. There are literally dozens of others like her in similar situations and it is my strong belief that the courts and the IRS should apply the guidelines of Section 703 not only after the date of enactment but also to settlements put in place prior to that time.

Mr. President, first, this bill passes an ultimate test that any bill has to pass that is of consequence.

This bill passes one of the strictest tests that something must pass in the Senate in order to get something done, and that is, it is bipartisan. It is bipartisan because of the leadership of Senator Baucus, and I thank him.

We have been hearing quite a bit about this legislation. Most of the complaints have been about what is not in the bill. I would like to have those who are complaining to focus on what is in the bill. Everyone needs to know that a vote against cloture is a vote against the items in this bill. This is a recorded vote, for which we will all be held accountable. The conference is closed. The House has voted overwhelmingly for this bill. If this bill does not get cloture, it is a dead bill.

Vote to end the Euro sanctions against U.S. exporters. They are now 12 percent. They will be 17 percent by March. Those sanctions hit farm products, timber, paper, citrus, and manufacturing. There are people being laid off because of these sanctions against our exports. A vote against cloture is a vote to continue the sanctions.

Farms and businesses shoulder this burden because Congress has failed so far to act. The manufacturing tax cut to create jobs in America that is in this bill goes to large and small corporations, family-held S corporations, partnerships, sole proprietorships, farmers, and co-ops. This $76 billion portion of this bill is only for manufacturing in the United States. It is not creating jobs offshore because it does not benefit manufacturing offshore.

Are you going to vote against giving individuals a deduction for the State sales tax against their Federal income tax that is in this bill? This bill is the most comprehensive agricultural, small business, and rural community incentive tax package ever. A vote against cloture is a vote against benefits in this bill that will help value-added agriculture.

The bill contains VEETC; 37 of our 50 States will receive more highway money because of the provisions in this bill. VEETC and this bill's provisions that shut down fuel tax fraud will put over $24 billion into the highway trust fund alone. This provision alone will create 674,000 new jobs across the country. A vote against cloture is a vote against highway money for your State.

A vote against cloture is a vote against highway jobs for construction of highways in your State. The energy package in the bill includes new incentives for biodiesel. This provision means jobs in our heartland, over 150,000 new jobs.

The bill accelerates production of natural gas from Alaska and the construction of a pipeline to carry it to the lower 48 States. This will create nearly 400,000 jobs in construction, trucking, manufacturing, and other sectors.

This bill devotes over $2 billion to section 45, renewable electricity production credit. This was a high priority for Senators Bingaman, Smith, Daschle, Hatch, Baucus, Snowe, Breaux, Lincoln, Conrad, Bunning, and Gregg.

The small business package in this bill extends small business expensing for another 2 years, and contains significant S corporation reforms. S corporation reform has always been a high priority in the Senate because it helps family-owned businesses.

A provision in this bill expands the new markets tax credit to help economic development in rural counties.

We have included also the Civil Rights Tax Fairness Act. We included a National Health Service Corps loan program to enhance the delivery of medical services to rural areas.

The bill provides all these benefits, nearly $140 billion worth, and this is a revenue-neutral bill, which means this bill does not add one dime to the Federal deficit.

It is all paid for by shutting down corporate expatriation to Bermuda, tax shelter leasing abuses by corporations, and ends all the Enron-type tax shelter deals. This is the most tough antitax shelter measure since 1986.

This bill contains some of the most important international tax reforms in decades, bringing foreign earnings home for investment in the United States instead of investing overseas, hence creating jobs in the United States.

We have heard complaints from Senator Landrieu because the bill does not contain her reservist amendment. I would like to make it clear that Senator Baucus and I offered that amendment on her behalf. We came up with a way to pay for that. All Senate conferees, Republican and Democrat, voted for it. The conference was open to the public. There were no backroom deals. The House, the other body, rejected it.

Voting down this bill will not bring back the reservist amendment. The conference is closed.

There is a great deal of good in this bill. We can rescue the manufacturing sector; we can end European Union sanctions on our farmers; we can respond to the recent rise of gas prices by supporting renewable fuels, and we can shut down every known tax abuse. Vote to finish the job. Vote for cloture. It is time to pass this very important bill.

I yield the floor.

Mr. President, I thank my colleagues. I want to speak a little bit about the conference report and maybe a little bit about Senator Landrieu's amendment.

First, I wish to compliment Senator Grassley and Senator Baucus for their leadership on this bill. The FSC/ETI bill was a very complicated bill. The Senate provisions alone--there were 276 provisions--dealt with about $180 billion of tax increases and tax cuts, a very complicated bill, very confusing bill. It had international provisions. But it was very important that we move forward, and we moved forward to basically--I started to say--become compliant with the World Trade Organization because they were imposing sanctions on U.S. exports, fees of 12 percent escalating 1 percent per month going up to 17 percent. So it was important that we resolve that problem.

Most people think the conference report solves that situation. I compliment them for it. The bill that came back from conference was a better bill than left the Senate--frankly, a much better bill. There are a lot fewer provisions. There were many amendments that were left out. I know the Senator from Louisiana is upset about her amendment being left out. There were hundreds of amendments left out, some of which have a lot of merit, some probably didn't have merit. I don't happen to agree with her amendment, and I want to touch on that for a second.

First, I want to finish on the FSC/ETI bill. The underlying premise of the FSC/ETI bill--which I am going to support, and I urge our colleagues to vote for cloture so we can finish this bill--is that we are going to give a benefit to manufacturers, a lower corporate rate than other corporations. I happen to disagree with that. I used to be a manufacturer. I used to run a manufacturing company, Nickles Machine Corporation. We made engine parts. We sold them around the world. Manufacturers get a lower rate, and we do it in this bill in the form of not a rate reduction but in the form of an exclusion of income. I think a rate would be a much simpler way to go, and I think it should apply to all corporations.

What we do in this bill is, we give an exclusion for a certain amount of income, I think 3 percent the first 2 years, 6 percent the next 3 years, and then 9 percent beyond that. The net effect of that for most corporations is, the corporate rate would go into effect 34 percent and then 33 percent and then 32 percent, if you are a manufacturer. If you are not a manufacturer but happen to be a corporation, in other words, you do professional services, maybe an attorney or maybe a doctor or something, or you have an accounting firm or you have a financial firm, if you have financial services, you are going to be taxed at a higher rate.

I think we should have a uniform corporate rate. It is a mistake. You have a lot of companies that do both. They are a manufacturer and they provide financial services or they provide other services. So you are going to find them having to segregate their income--this part is manufacturing, this part is financial or other services. That is going to mean asking for a lot of audits, a lot of confusion, and maybe problems with the IRS and future Congresses. Future Congresses also will be dabbling with the definition of manufacturer because there are a lot of people defined in this bill as manufacturers that a lot of us wouldn't think of as manufacturers; i.e., individuals involved in architectural engineering, or individuals or companies that are construction or software companies or oil companies or extraction companies. There are software companies, the film industry. You have a lot of industries that aren't normally thought of as manufacturing and are now defined as manufacturing.

When people realize there is a 10-percent lower corporate rate if you are defined as a manufacturer, my guess is you will have a lot of future interest and amendments. The lobbyists will be very big trying to make sure that whoever their client is is defined as a manufacturer. So the number of manufacturing jobs, which has been on a fairly steady decline for the last 40 years--it has bounced up in the last year--will increase dramatically, not because there are more manufacturing jobs, but because more jobs are defined as manufacturing. I don't think that is good policy.

I have mentioned that. I know Chairman Grassley and Senator Baucus are well aware of my concerns. I tried to fight that fight along with Senator Kyl. We were not successful. We tried every way we could, but we didn't win on that one. But it is important that we become WTO compliant. It is important that we pass a bill. I don't think we are going to solve the problem I am talking about in differentials in the next 3 months or, frankly, the next 6 months. So I urge our colleagues to vote in favor of it.

In relation to the Landrieu amendment, her discussion on it, I appreciate her passion. But no one on her side raised this amendment. I sat in the conference for days. She had her chance. There were hundreds of amendments that were not adopted. I don't happen to agree with the substance of her amendment. But everyone was entitled to have their chance. Chairman Grassley insisted on having the entire Finance Committee represented in the conference. I compliment him for that. It was a very open, fair conference. All Senators who were on the Finance Committee were represented, were there, or could have attended. So again, sometimes you don't win on your amendments.

I compliment again Senator Grassley and Senator Baucus. I urge our colleagues to vote in favor of cloture.

recusal

Will the Senator yield?

Will the Senator yield for a question?

Mr. President, will the Senator yield for a question?

I need to know a little bit more about the amendment. The tax credit goes to the employers. Is there any guarantee that money, the tax credit--let's say $20,000 for the service man or woman-- goes to the service man or woman. How do we know that happens? Is there a delay before they would benefit from those dollars?

I am not sure it is written that way. I am not sure it is a requirement that an employer has to give the money immediately to a service man or woman. I suspect that is your intent. I don't believe that is the way the amendment is written. I would like to know more about it.

I have a different question. If the amendment were agreed to, you would be paying substantially more for a man or woman serving side by side--let us say in Iraq or Afghanistan in combat a situation, the Federal Government would be paying significantly more for that reservist than they are for the Active-duty. How much differential should we pay? Is that equitable for the thousands of people who are Active-Duty to be paid less than the Reserves when their lives are at risk equally, when they are in the same trenches doing the same job?

Will the Senator yield further?

I understand the Senator didn't like my first question because she is trying to give the Guard and Reserve additional compensation and additional pay but through a tax credit which goes to their employer which may take some time to get directly to the guardsmen or reservists who have been activated. If you want to pay them more, why don't you pay them more? Why don't you move an amendment through the DOD authorization bill? We did just last night under the good work of Chairman Warner--or pay more through the Appropriations Committee so they would be paid on a monthly basis. I am not sure I agree with the Senator that there should be a differential. She may make an eloquent argument, but if she feels compelled they should be paid more, pay them more. But don't you think there is something lost by giving a tax credit that may or may not be funneled to the employees? It may take some time. There may be some lag. There may be some fraud, or it might not happen. But if you want to pay them more, pay them more.

Mr. President, I speak in opposition to the amendment, both in substance and on procedure, and procedure may be more important.

First, on the substance, I question the wisdom of whether we want to have in our active combat forces and our Reserve forces who are fighting side by side a significant pay differential for doing the same thing. Senator Landrieu wants to. We have not done that in the past. I don't think that is a smart thing to do. We have benefits for Regular Army and we have benefits for the Guard and Reserve.

I used to be in the Guard, but to say we want to have a significant pay incentive if a guardsman or reservist is activated over and above the soldiers who are full-time active duty, I question the wisdom of that. That is debatable.

I have no doubt in my mind if we are going to compensate them, and we are talking about compensation for our men and women who are fighting, whether they are Guard and Reserve or whether they are Active, that should be done in the Armed Services Committee. That should be done in the Appropriations Committee, not compensate them through the Tax Code. The Tax Code was not written to be, yes, we will finance their pay. We have a Tax Code that is favorable for people who are in combat situations. It is tax free. They do not pay income tax. That is for Guard and Reserve or Active Duty. If they are in a combat area, they do not have to pay taxes. That is fine. That is the way it should be.

The Senator wants a differential. The Senator wants to pay them more, pay them more. The Senator from Louisiana is on the Appropriations Committee, and we have the chairman of the Appropriations Committee and the Defense Subcommittee. If it is necessary to have a differential to make it work for our Guard and Reserve, have an amendment to pay them more. If it is 10 percent, if it is $10,000 or $20,000, the substance of the amendment is we will give a tax credit to some employers--some get a $15,000 tax credit and some employers get $20,000, some would be 50 percent and some are 100 percent. It is confusing. How are we sure that tax credit gets to the individual, and will it get to the individuals and/or their families immediately? I don't think that connection has been made.

My point is that is not the right way to do it. If you want to compensate them, compensate them through the appropriations process. Pay them more. We passed an authorization to increase pay for men and women.

Substantively, the amendment leaves a lot to be desired. Procedurally, it is worse. Procedurally, this was an amendment in the Senate; it was not in the House. I happened to be a conferee.

I heard my colleague from Louisiana say she called up House conferees and asked: Why didn't you accept this? A couple of comments. The Senator needs to call up conferees before the conference is closed. Not one Member raised this issue in the conference individually. I understand Senator Baucus and Senator Grassley put it in a package of amendments and sent it to the House, and the House rejected that entire package. But we also considered dozens and dozens of amendments individually that people felt strongly about. Some were passed. I had some pass and I had some defeated. That is the legislative process. No one raised this amendment individually. The House did not reject this amendment individually. It was not sent to the House.

No Member of the Senate Finance Committee, Democrat or Republican--we had 23 members of the conference committee. Anyone, Democrat or Republican, could have offered this amendment. My guess is it would have passed the Senate conference. It would not have had my vote, but it would have passed the Senate. Conferees would have sent it to the House, but no one did.

That is the way we work a conference. Sometimes you win and sometimes you lose. To say, wait a minute, my amendment was not adopted, so therefore I will try and tie the Senate up for 3 or 4 days until you pass my amendment by unanimous consent--there are hundreds of amendments that were not adopted in that conference, hundreds. Every member of the conference had an amendment they wanted to have passed that did not pass. That is part of the legislative process. If we all came up and said, wait a minute, I feel so strongly about that amendment that did not pass I will hold the entire Senate up for a few days to bring that to the attention of the Senate, that is not a very effective way of legislating. There are effective ways to legislate.

If Members really want to increase the compensation of Guard and Reserve, they need to be talking to the chairman of the Appropriations Committee. They need to talk to the authorizing committee. They need to talk to the Pentagon. They need to ask, How can we make this work? Not have a system that says, Well, some companies get a tax credit, a bigger tax credit, and maybe it will flow to the employee or maybe flow to the employee a year later--that is not a good way to compensate them. Compensate them directly, as we should, not through refundable tax credits that may or may not get to the family. Try and work it out in a way that would be of benefit, not to say, yesterday they were trying to pass this as a freestanding tax bill but automatically it would be blue-slipped in the House. They will not even consider that. That does not help the cause.

Procedurally, this approach of demanding we pass something by unanimous consent because it was not included in the conference when no one even raised it in the conference is just not the way you legislate. I can think of any number of Senators who were disappointed they did not get what they wanted in conference, and they could try the same thing. I don't think that is effective in legislating. I don't think it will work.

I make those comments. Substantively, the refundable tax credit going to employers is not the correct way to do it. The correct way to do it is, if the individuals who spend a lot of time on how much we should compensate our men and women in the armed services, Regular Army and regular military, as well as Guard and Reserve, if they are convinced we should have a differential for people serving side by side, then we need to be working to implement that through their committees and make it direct compensation so the men and women serving receive that paycheck immediately, not some deferred way that might come through an employer and might be subject to abuse.

I make those comments. The procedure is fatally flawed and substantively the approach is very well intended, but unfortunately I don't think substantively the amendment is the correct way to compensate the men and women who are serving both Active Duty and in the Guard and Reserve. We have to keep in balance what we are paying Active and what we pay Guard and Reserve, and having a big differential could cause a lot of problems.

I am happy to yield.

Mr. President, I appreciate the comments and question by my colleague from Virginia.

I yield the floor.

Mr. President, I thank the Chair. I thank the distinguished President pro tempore of the Senate, the honorable Ted Stevens, a great Senator from the State of Alaska; as a matter of fact, the Senator of the 20th century for the State of Alaska.

On this Sabbath Day in which the Senate convenes in an extraordinary session, I read from the King James Version of the Holy Bible, Exodus 35, verses 1 through 3.

And Moses gathered all the congregation of the children of

Israel together and said unto them, These are the words which

the Lord hath commanded, that ye should do them.

Six days shall work be done, but on the seventh day there

shall be to you an holy day, a sabbath of rest to the Lord:

whosoever doeth work therein shall be put to death.

Ye shall kindle no fire throughout your habitations on the

sabbath day.

I now read from the Ten Commandments, again King James Version of the Holy Bible, Exodus 20, verses 8 through 10.

Remember the sabbath day to keep it holy.

Six days shalt thou labor, and do all thy work:

But the seventh day is the sabbath of the Lord thy God: in

it thou shalt not do any work, thou, nor thy son, nor thy

daughter, thy manservant, nor thy maidservant, nor thy

cattle, nor thy stranger that is within thy gates:

For in six days the Lord made heaven and earth, the sea,

and all that in them is, and rested the seventh day:

wherefore the Lord blessed the sabbath day, and hallowed

it.

That is the Fourth Commandment passed down from God to Moses and from Moses to the Israelites. Those words are holy for people of many faiths. Christians and Jews are bound to follow the Ten Commandments. Muslims, too, hold dear a similar lesson from the Koran, and scores of millions from that faith also make strict observance of their own day of rest.

But today the Senate has been called into session despite the words of the Fourth Commandment. Moreover, the matter being debated today is no question of life or death. There is no dire emergency that brings us here on this Sabbath Day. There is no emergency that demands the elected representatives of the American people place the pursuit of their work over the importance of their faith. No, the Senate has been called in on a Sunday for a mere procedural vote. What would be the consequences if the Senate were not called into session today for a single vote on cloture? It would only mean that the matter before the Senate might take 1 day longer to complete. What a tragedy that would be.

Must we ignore the sanctity of the Sabbath just to call the Senate into session and have Senate staff come in from their homes throughout the nearby area in order to cast one procedural vote? The Senate should not be in this position. Our staffs and their families, our own selves and our families should not be in this position.

This Chamber, on the whole, has an excellent record for accommodating the faiths of those who serve the American people. It has become routine for the Senate to temporarily suspend its business so that Senators, both Christians and Jews, can carry out their religious services and their religious observances. In fact, I suggested yesterday that all the Senate would need to do would be to delay the vote until Sunday, today. That would be in accordance with the observing of the old Sabbath. That is when the Sabbath traditionally ends. If only there were a delay in this afternoon's vote by 5\1/2\ hours, Senators would not have been forced to choose between our responsibilities to our Nation and honoring our Sabbath, our day of rest and prayer. This suggestion was rejected.

What is the rush to have this particular vote on a Sunday afternoon? Most of us would like to have observed this Sunday afternoon and this morning prior to noon with our families, would like to have observed the opportunity to go to the church or the churches of our faith. What is the urgent need to keep Senators and our staffs away from their families on this, a day of rest? What message does this send to the American people?

I do not believe a Sunday session of the Senate for such a trivial matter as a procedural vote sets a good example for Christians around this country or Christians around the world. It does not set a good example for anyone who wishes to observe the Fourth Commandment. And for what?

The Senate has been thrown into too much confusion as we rush to finish too much business in too short a time. I have said repeatedly the Senate should not be rushed in its business, especially on complex matters of great national importance. It is a disservice to those whom we are elected to represent.

Now we see that there is another side of that coin. The uncontrollable zeal to get business done as soon as possible has resulted in a decision that is a disservice to those who work in this Chamber. Because of this poor planning, many of us and our families are being forced to give short shrift to our observance of the Sabbath. That is not right.

I am a Christian. I don't claim to be the best Christian around. My mom and dad were great Christian people. They had never been to school very much. I have heard someone on the campaign trail say he is the first in his family line to graduate from college. Let me say I am the first to enter the third grade in all of my line, my parentage, my ancestor line.

I can say this, though: My old dad and mom who raised me--I was an orphan at the age of 1; my mother died in the influenza epidemic of 1918--the

kind people who raised me were very religious. They didn't carry it around on their sleeve. They did not go around criticizing other people. They practiced. I can remember many times after I had gone to bed hearing my Christian mother on her knees, down in another room, praying, praying, praying. That old coal miner dad who was my uncle--I called him my dad--he was the only dad I ever knew, really. He was a coal miner. When he died and left this world he didn't owe any man a penny. He never criticized anybody else. I didn't hear him ever in all my years use God's name in vain. So those were my Christian parents. I was raised that way.

I profess today to be a Christian. I don't profess to be good. The Bible says no man is good, so I don't say that I am good. But I am a Christian. And there are millions like me in this country and around the world who believe that we should keep the Sabbath Day holy and remember it.

In this modern world of 24 hours a day, 7 days a week commerce and enterprise, keeping the Commandments and remembering the Sabbath, to keep it holy, may seem an antiquated notion to some. But it is, nevertheless, a central pillar of many faiths, and it reflects the principle on which this Nation was founded: ``One Nation, under God.''

Now, I do not try to press my faith on anybody else. I am like Samuel Adams, a few years before the Constitutional Convention, when he said: I can listen to any prayer--any prayer. And so can I. I can listen to the Muslim prayer. I can listen to the prayer of the Jewish people. I can listen to the Catholics as they pray. I am willing to listen to any prayer. I do not attempt to press my religion on anybody else.

But I think we as a Senate, here in the eyes of the American people and the world on the Sabbath, do not give a very good impression. We ought to set the example. We in the Senate ought to set the example.

Of course, if the ox or the ass were in the pit, as the Bible says, then pull him out if it is on the Sabbath. But the ox is not in the ditch. That is not why we are here. We are not here because of some dire emergency that threatens the lives of the American people. This is not a dire emergency. This could easily have been put over until tomorrow.

I have been the majority leader of this Senate in some years past. I have been the minority leader of this Senate in some years past. I know something about the rules. I may have forgotten more than some will ever learn, but I can remember the powers of the majority leader. And it is within any majority leader's power to put this matter over until Monday. It could have been done yesterday. And it could still be done. But we are here. The staffs have been called out now. Senators are here. And so we have to observe what the leadership has ruled. We are here. But I would say, it was unnecessary.

I am sorry that the Senate is in today. We would not have lost anything by waiting until tomorrow. But it has been done.

Mr. President, how much time do I have left?

I thank the Chair.

Mr. President, we hear a lot about religion these days. I say, let's practice a little of it here in the Senate and on the campaign trail. I hope the Senate in future years will not repeat this mistake of unnecessarily sacrificing the observance of the Sabbath on the altar of political expediency. We could have done better.

We waste a lot of time here. There were many days when we could have been in and we could have been doing the work of the people, the work of the Senate, but we chose not to be in. These are workdays I am talking about, many of them throughout the year that is past, some of them recent. The work could have been done. It was not necessary to back this work up to the point that we have to come in here on a Sabbath--on a Sabbath--to vote. And for what? A mere procedural matter.

Mr. President, I thank the Chair and I thank all Senators.

I yield the floor.

Mr. President, I believe I have 2\1/2\ minutes left.

Mr. President, may I say to my friend, the distinguished Senator from Alaska, who is the President pro tempore and the chairman of the Appropriations Committee, this man has, throughout the year, sought to keep the Senate on schedule and to not only have the committee report out all of the 13 bills but to have the Senate pass them. I think if all of us had worked as diligently as the Senator from Alaska to get the work done, we would not be here today.

Now, I hesitate to mention a Senator by name--the distinguished Senator from Alaska has done that--and that Senator is not on the floor. But let me say, whether we like it or not, that Senator was within his rights.

And the Senator from Alaska might be in the same position one day, and I may be.

The blame here should be placed in a manner on the whole Senate and particularly, I have to say, the leadership of the Senate. The Republican leadership is in control so I think they bear the greatest responsibility. As I said yesterday, we all are at fault a little bit. But my complaint is not against a Senator. My complaint is the way we have done our work all year long. We dilly dallied, delayed, and had several days out of session when we could have been in, could have been doing our work. That goes for our recent times as well.

I say there is where the overall fault lies. I am sorry that because of that, we have been backed up with our backs up against a timeline here when we are about to go out for a Presidential election. And we should not have been put in this position. We should have done this work earlier. I say it was wrong to come in on the Sabbath Day. It didn't have to be done. I regret it.

I thank the Chair and all Senators.

Mr. President, today the Senate is considering the conference agreement for H.R. 4520, the American Jobs Creation Act of 2004. I voted against this legislation when it was reported out of the Senate Finance Committee and again when it was approved by the full Senate, so I would like to explain why I am reluctantly supporting the conference agreement.

I was a conferee for this conference agreement and am supporting it for four reasons. First, the legislation makes necessary improvements to the way the United States taxes foreign-source income. These changes are a good first step at rationalizing the way we tax U.S.-based multinational companies. Second, the conference agreement dropped many of the tax increases that were included in the Senate-passed bill that would have inappropriately raised taxes on many U.S. businesses. Third, Senator Grassley has committed to work with me on broad-based corporate tax reforms next year. Finally, I am supporting the conference agreement because it is important to come into compliance with our international obligations.

The conference agreement includes some very worthwhile provisions. Most importantly, it reforms and simplifies the way we tax U.S.-based multinational businesses. Under current law, U.S.-based multinational companies are subject to a tax system that was designed in the 1960s, that we have failed to modernize as global business transformed and grew, and that has only been modified when Congress needed to raise revenues. As such, the system is inconsistent and inefficient and subjects U.S.-based companies to double-taxation, all of which put our companies at a disadvantage vis-a-vis their foreign competitors. The conference agreement fixes a number of these problems.

First, the conference agreement addresses two very serious problems with our foreign tax credit system. The U.S. tax system is a worldwide system, meaning we tax the income of U.S. taxpayers no matter where it is earned. The problem with such a system is that income is double- taxed, once by a foreign jurisdiction and again by the United States. Because many other countries only tax income that is earned within their borders, U.S. companies face double-taxation while many of their foreign competitors do not. To avoid this problem, the U.S. gives taxpayers credits for taxes paid to a foreign jurisdiction, which are used to offset U.S. tax liability. If the system worked perfectly, the net result would be that corporate income is taxed one time at the U.S. rate of 35 percent. The problem is that the system does not work perfectly; there are so many restrictions on the ability to use foreign tax credits that, in practice, foreign earnings are often double-taxed. Further, under current law, unused foreign tax credits can only be carried forward 5 years, after which time they expire, resulting in permanent double-taxation. The conference agreement does two things: First, it eliminates many of the restrictions on using foreign tax credits by reducing the number of ``baskets'' that the different types of credits are segregated into from nine to two, making it much easier to use foreign tax credits. Second, the conference agreement extends the carryforward period to 10 years so that taxpayers have twice as long to use foreign tax credits before they expire. Both of these changes are very important and are a big part of the reason I am supporting the conference agreement.

The conference agreement also reforms the ``interest allocation rules,'' which can have the perverse effect of making it more expensive for U.S. companies to build new U.S. facilities by restricting a company's ability to deduct interest payments used to finance the construction of such facilities. The conference agreement gives companies a one-time choice of how to allocate and apportion their interest expenses so that if a company elects the new ``worldwide fungibility'' approach instead of current treatment, interest expenses incurred in the United States would only be allocated against foreign- source income in certain restricted circumstances. This also makes it less likely that U.S. companies will have their use of foreign tax credits restricted, thereby alleviating the problem of double-taxation. Like the foreign tax credit reforms I mentioned earlier, the interest allocation reforms are another reason I am supporting this legislation.

I want to express my disappointment with the centerpiece of this legislation, however. I continue to be concerned that the manufacturing deduction represents poor tax policy because it establishes for the first time a lower tax rate for one segment of our business community-- manufacturing--while continuing to impose the higher 35 percent rate on all other U.S. businesses. Sound tax policy should be fair and neutral and the manufacturing deduction is neither. I expect that this provision will cause a great deal of ``game-playing'' as companies strive to define as much of their activity as possible as ``manufacturing'' to more greatly benefit from the deduction. As a result, I believe that the Treasury Department is correct when it predicts that we will see an increase in audits and litigation as a result of this provision.

I noted that, for the first time, Congress has established a bifurcated corporate tax rate system in this legislation. Non- manufacturing companies also create good jobs, contribute to our growing economy, and compete with lower-taxed foreign companies just like U.S. manufacturers, yet these companies do not see tax rate relief in this legislation. It would have been far better to have provided a corporate rate reduction across-the-board for all U.S. companies. This would have avoided the game-playing, would have been far simpler for taxpayers and the government to administer, and would have made the United States a more attractive place to do business. This last point is important. Our combined federal and state tax rate is 40 percent, while in Asia the rate is 30.4 percent, and in Europe the rate is 27.7 percent. Our trading partners have been aggressively cutting their corporate tax rates. It is time the Congress stop trying to set industrial policy through targeted tax preferences and confront our high corporate income tax rate directly. I urged my colleagues to take this approach, and while many of my colleagues agreed with me, this effort did not prevail. I predict that, in time, Congress will repeal the manufacturing deduction and replace it with a corporate tax rate reduction. Canada had a similar manufacturing deduction in place and found it to be so complex, subject to abuse, and such a source of tax controversies that Canada eventually replaced it with a lower corporate tax rate.

Because of my serious concerns about the manufacturing deduction, I am pleased that Senate Finance Committee Chairman Grassley has agreed to work with me on a review of our corporate tax structure, including not only corporate income tax rates, but also on making the lower tax rates on dividends and capital gains permanent. I appreciate his offer and look forward to working with him on this important issue.

The conference agreement drops some of the special interest tax provisions that were included in the Senate-passed bill. I am disappointed, however, that other tax subsidies, such as various tax subsidies for electricity production, were retained in the conference agreement. In this era of budget consciousness, I would much prefer to use scare revenue offsets to enact meaningful, pro-growth, broad-based tax reforms that will have a positive effect on the overall U.S. economy. While some of these provisions might be justifiable, we should always keep in mind that the purpose of our tax system is to raise revenue for the Federal Government in the most efficient means possible, and not to reward special interests. I firmly believe we should focus on broad-based tax relief that provides growth-oriented incentives. This would make our system of taxing business income far more efficient for the Federal Government and for taxpayers alike, and most importantly, it would foster greater economic growth and help businesses create jobs. The conference agreement we consider today largely provides the opposite result and thus accentuates the

great need for tax reform. The President has expressed support for comprehensive tax reform and I fully intend to work with him on that project.

This conference agreement is revenue neutral, which, in itself is not a bad thing, but should not be a prerequisite for tax legislation. Revenue neutrality means that there are as many tax increases as tax cuts, and we must be very careful about increasing taxes. I am pleased that in the conference committee we were able to eliminate several of the more troubling provisions we euphemistically refer to as revenue raisers, including the codification of the ``economic substance doctrine'' and the taxation of certain settlements, fines and penalties. Quite simply, these are tax increases--sometimes warranted, if we are closing unintended loopholes, but tax increases nonetheless. Congress should approve tax changes to improve the conditions of the economy and to leave more money with the taxpayers who earned it and should not be bound by strict rules of revenue neutrality. We must remember that tax cuts and spending are not the same and do not have the same effect on the economy or on the Federal budget. Tax cuts allow American families, business owners, and investors to keep more of their own money, which encourages economic activity. Increased economic activity brings additional tax revenues into the Federal government, thus improving our budgetary situation. Unlike tax cuts, new spending requires the government to take control of a bigger slice of the economy, which hinders economic growth. I encourage my colleagues to refuse to be bound to ``revenue neutrality'' for its own sake, but to pursue rational tax policies on their merits.

Finally, this legislation repeals our export tax subsidy that was judged to be illegal by the World Trade Organization, WTO. While I have serious concerns about the commitments made by our negotiators that led to this result, the United States nonetheless must abide by the agreements we make. Repeal of the export subsidy will bring the United States into compliance with our international obligations and this will end the tariffs the European Union has imposed as a result of the dispute on many U.S.-made products, including products made in my State of Arizona.

While I am supporting the conference agreement, I want my colleagues to know that I am very serious about my commitment to pursue policies that provide broad-based, pro-growth, supply-side tax incentives, rather than targeted tax preferences or misguided industrial policies.