REDUCE Spam Act of 2003

Madam President, I ask unanimous consent that the Senate now proceed to the consideration of Calendar No. 209, S. 877; provided further that the committee amendment be agreed to and be considered original text for the purpose of further amendment.

Madam President, I suggest the absence of a quorum.

Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

Madam President, this bill was introduced in April by Senators Burns and Wyden, and the substitute version was approved by the Senate Commerce Committee on June 19.

Also, we have had intensive negotiations with the Senator from New York, Mr. Schumer, who is now on the floor, concerning a ``do not spam'' aspect of this legislation.

First of all, I wish to thank, of course, Senator Hollings, the ranking member of the committee, for all of his effort, but I particularly acknowledge my two colleagues who are on the floor, Senators Burns and Wyden. Around here, we have a tendency to take credit for a lot of things that may not necessarily be true, although I am not sure that is true in my case, but the fact is, Senator Burns and Senator Wyden have worked for, I believe, 3 years on this issue. It is complex. It is difficult. It has a lot to do with technology. The issues are very technical in nature in some respects. They have responded to what I think is a major concern of every young American and every American who uses a computer, and that is this issue of unwanted spam.

I again tell my colleagues that without the efforts Senator Burns and Senator Wyden have made on this bill, we would not be here today, and I am very grateful for their participation.

I believe the ranking member, Senator Hollings, wishes to make an opening comment, and then I would like to be recognized after Senator Hollings.

I yield the floor.

Madam President, I will mention Senator Schumer's amendment which we have agreed to, which as soon as opening statements are completed we will propose, and I believe it will be without objection. It does do several things. I will mention it now because Senator Schumer has worked so hard on this amendment.

This amendment says that not later than 6 months after the date of enactment of the act, the Commission will transmit to the Senate Committee on Commerce, Science, and Transportation, and to the House of Representatives Committee on Energy and Commerce a report that sets forth a plan and timetable for establishing a nationwide market Do Not E-mail Registry. It includes an explanation of any practical, technical, security, privacy, enforceability, or other concerns the Commission has regarding such a registry and includes an explanation of how the registry would be applied with respect to children with e-mail accounts.

Finally, it says the Commission may establish and implement the plan, but not earlier than 9 months after the date of enactment of this act.

I say to my friend, Senator Schumer, that I will do everything in my power to make sure that this is enacted and this plan, not earlier than 9 months, should be implemented. I hope that is satisfactory.

Again, I thank Senator Schumer. If we can implement a Do Not Spam provision which is clearly modeled after the Do Not Call list, I think it will have enormous benefit to all Americans.

I will make a few comments about the bill and then yield to my colleagues and to Senator Schumer for their remarks.

If passed into law by Congress and signed by the President, the CAN- SPAM Act would be the first Federal law to regulate senders of commercial e-mail.

The bill would prohibit senders of commercial e-mail from falsifying or disguising the following: their identity; the return address or routing information of an e-mail; and the subject matters of their messages. Violations of these provisions would result in both criminal and civil penalties.

The bill would also require senders of commercial e-mail to give their recipients an opportunity to opt out of receiving future messages and to honor those requests. Except for e-mail that is transactional in nature, such as purchase receipts or airlines ticket confirmations, every commercial e-mail sent over the Internet to American consumers would be required to provide this valid, working opt-out or unsubscribe mechanism. These rules represent current industry best practices regarding commercial e-mail messages.

For unsolicited commercial e-mail, however, the bill would require more disclosures from the sender of the message, such as providing recipients with instructions on how to operate the opt-out mechanism, a valid physical address of the sender, and a clear notice in the body of the message that it is an advertisement or solicitation.

In an amendment I offered in committee, this bill would also prohibit businesses from knowingly promoting or permitting the promotion of their business through e-mail transmitted with false or misleading identity or routing information. Those that benefit the most from sending fraudulent spam, the companies advertised in those messages, should be held accountable, and they will.

As my colleagues, Senators Burns and Wyden, will explain in more detail, the bill would also target many of the insidious mechanisms used by today's spammers, including e-mail harvesting, dictionary attacks, and the hijacking of consumer e-mail accounts in order to send spam.

In addition to setting strict rules of the road for senders of commercial e-mail, the CAN-SPAM Act would provide tough criminal and civil penalties for offenders, and a multilayered approach to enforcement. This bill provides for enforcement actions by the FTC, State attorneys general, Internet service providers, and if Senator

Hatch's proposed criminal amendment is passed which I assume it will, the Department of Justice.

I strongly support this bill and I urge my colleagues to join me, Senators Burns, Wyden, Hollings, Hatch, and others, in passing this bill as a first step toward giving consumers back some control of their e-mail in-boxes.

I would like to make a few general observations about this issue that I have come to learn over the years that the Commerce Committee has examined it.

According to the Pew Internet & American Life Project, approximately 140 million Americans, nearly half of all U.S. citizens and 63 percent of full-time or part-time workers regularly use e-mail. E-mail messaging has fundamentally changed the way we communicate with family, friends, coworkers and business partners; the way consumers communicate with businesses that provide goods and services; and the way that businesses may legitimately market products to consumers. The growing affliction of spam, however, may threaten all of this.

We must keep in mind the tremendous promise that the Internet and more specifically e-mail, holds for consumers and businesses alike. We must recognize that the word ``spam'' means different things to different people.

The Federal Trade Commission defines spam generally as ``unsolicited commercial e-mail.'' and some Americans do not want any of it. Other consumers like to receive unsolicited offers by e-mail; to these consumers, spam means only the unwanted fraudulent or pornographic e- mail that also floods their inbox.

Many American businesses view e-mail over the Internet as a new medium through which to market or communicate more efficiently with consumers. To them, this type of communication is not spam, but commercial speech protected by the first amendment. The Direct Marketing Association reports that 37 percent of consumers it surveyed have bought something as a result of receiving unsolicited e-mail from marketers.

Internet service provider are the businesses caught in the middle, forced every day to draw distinctions between what they perceive as legitimate e-mail and what is spam. In this environment, the risk of ISPs blocking legitimate mail that consumers depend on, such as purchase receipts or healthcare communications, is as much a concern as the prospect of failing to block as much spam as possible in the face of consumer demand. Often, the filters used by ISPs fail to meet their subscribers' expectations on both accounts, failing to block the spam and sometimes blocking legitimate e-mail from coming through, leaving consumers, legitimate businesses and the ISPs themselves frustrated.

I think Senator Burns and Senator Wyden remember, as well as I do, a professional spammer who came and testified before our committee. I mentioned in passing that it took him approximately 4 hours to break through a filter that had recently been in place, and he immediately began his work again of spamming millions of people every day. He was a man who was proud of his work, by the way. He was a very interesting witness and, I might say in an otherwise dull hearing, a very entertaining one.

We must be mindful that in our quest to stop spam, we may impose e- mail restrictions that go too far and actually prohibit or effectively prevent e-mail that customers want to receive and that legitimate businesses depend on to service their customers.

I believe this bill strikes the proper balance, thanks to the efforts of Senator Wyden, Senator Burns, Senator Schumer, and others, by carefully targeting the spam that consumers reject while preserving the fundamental benefits of e-mail to all Americans.

Regardless of whether we call all solicited commercial e-mail spam, one fact is clear: Spam is rapidly on the rise. Its sheer volume is significantly affecting how consumers and businesses use e-mail. Less than 2 years ago, spam made up only 8 percent of all e-mail. In a hearing before the Commerce Committee in May, my colleagues and I learned that spam accounted for more than 45 percent of all global e- mail traffic and, worse, it would probably exceed the 50 percent mark by year's end.

In the committee's hearing, America Online--our Nation's largest Internet service provider with roughly 30 million subscribers-- testified that it blocks 80 percent of all its inbound e-mail--nearly 2.4 billion out of 3 billion messages it receives each day. Not surprisingly, this number of blocked messages was nearly 2.5 times larger than the 1 billion messages AOL blocked per day only 2 months prior to that hearing, and nearly 5 times larger than the 500 million messages it blocked per day in December 2002.

It's not just AOL. Our Nation's second and third largest e-mail providers, Microsoft and Earthlink, have also reported a tremendous surge in spam. Microsoft, the provider of MSN mail and the free Hotmail service, reported in May that both services combined block up to 2.4 billion spam messages each day. Earthlink, the third largest ISP in the United States, also reported a 500 percent increase in its inbound spam over the past 18 months.

I realize that these numbers may not mean as much to those who do not follow e-commerce closely, so let me put it in perspective to what nearly all Americans are familiar with--junk mail. The USA Today recently reported that more than 2 trillion spam messages are expected to be sent over the Internet this year, or 100 times the amount of direct mail advertising pieces delivered by U.S. mail last year.

Managing this influx adds real monetary costs to consumers and businesses.

A 2001 European Union study found that spam cost Internet subscribers wouldwide $9.4 billion each year, and USA Today reported in April that research organizations estimate fighting spam adds an average of $2 per month to an individual's Internet bill.

Costs to businesses are also on the rise. Ferris Research currently estimates that costs to U.S. businesses from spam in lost productivity, network system upgrades, unrecoverable data, and increased personnel costs, combined will top $10 billion in 2003. Of that total, Ferris estimates that employee productivity losses from sifting through and deleting spam account for nearly 40 percent of that--or $4 billion alone.

There are other costs to our society besides monetary costs. All of us are deeply concerned about the risks to our children who use e-mail and may be victimized by the nearly 20 percent of spam that contains pornographic material, including graphic sexual images.

Parents encourage their children to use the Internet to play and do schoolwork, and to use e-mail to reach distant relatives. Yet, parents today spend more and more of their time worrying that their children may open up an e-mail, disguised to look like it's from a friend or loved one, only to find pornography.

This greatly concerns me as a parent, as a legislator and as an American citizen. First and foremost, parents should not have to think twice before encouraging their children to use the computer at home.

In addition to pornography, the FTC also tells us that two-thirds of all spam contains deceptive information, much of it peddling get-rich- quick schemes, dubious financial or healthcare offers, and questionable products and services.

Spam is a serious and rapidly growing problem that the Senate must act on, but we must also be mindful of the complexity of the problem we face. While I agree with my colleagues in the Senate who believe that passing legislation is a necessary step, I also believe that legislation alone will not solve the problem of spam.

Spammers today disregard our laws and are winning the technological arms race with Internet service providers who try to block the spam they send. The New York Times recently reported just one example of how unscrupulous spammers were using technology to stay one step ahead of the law--in this instance, by highjacking a local Virginia school's computers to send out untraceable spam.

I repeat: A local Virginia schools computers. The same day, in the Commerce Committee's hearing, Mr. Ronald Scelson--who is popularly known by his moniker ``The Cajun Spammer''--testified that it took him only 12 hours to ``crack'' the latest technology filter supplied by the company of another witness at the table. Not only did he hack into their filter and figure out how to defeat it, the

Cajun Spammer had distributed the keys to unlocking the filter to all of his fellow spammers so that they too could send spam past the filters to the ISP's subscribers.

Keeping up with resourceful spammers' latest technology is not the only challenge. Jurisdictional barriers also complicate enforcement, and as we heard in our hearing, nearly 90 percent of all spam is untraceable and may be passing through mail servers outside of the United States.

I mention these things only to emphasize the complexity of this problem and to remind my colleagues that the odds of us defeating spam by legislation alone are extremely low. The fact that there may be no silver bullet to the problem of spam, however, does not mean that we should stand idly by and do nothing at all about it.

The CAN-SPAM Act is a good first step, and one we should take today.

It is clear this Congress must act, but we should make no mistake-- unless we can effectively enforce the laws we write, those laws will have little meaning or deterrent effect on any would-be purveyor of spam.

At the Commerce Committee's executive session where we considered this bill, I introduced an amendment that would empower the FTC to take action against businesses that financially benefit from the sending of spam with deliberately falisifed sender information. This amendment passed unanimously and I would like to take a moment here to briefly comment on it because it goes to the heart of this enforcement matter.

In two hearings before the Commerce Committee this past spring, the chairman and Commissioners of the FTC testified to the Commission's tremendous difficulty in tracking and finding spammers who send out spam with fraudulent and often untraceable transmission information.

The chairman advised us, however, that their investigations are usually most effective when ``following the money'' to track down spammers. By this, they mean following the Web link or phone number in the spam message that consumers follow with their money to purchase the product or service promoted in the spam. From there, the FTC attempts to prove a connection between the business and a spammer who sent it out on their behalf. In essence, they spend significant time and effort attempting to follow the money trail all the way back to the spammer-- if they can find them.

As an alternative to the inefficient and often slow moving process, the amendment I proposed which is now section 6 of the bill was designed to help the FTC enforce the law against those businesses at the front end of the money trail that are promoted in the spam consumers receive. They need to go further, and here is why.

Many unremarkable businesses employ sophisticated spammers to send e- mail to consumers in large volumes with deliberately falsified identity and routing information in order to get past the ISP's spam filters. These businesses often escape liability because enforcement efforts are too often focused on catching the spammer rather than the unscrupulous businesses that hire them in the first place.

Section 6, however, would make it easier for the FTC to enforce the law against businesses knowingly complicit in the use of spam to promote their businesses with deliberately falsified routing information. I urge my colleagues to support this principle of holding businesses that benefit from spam messages accountable for the acts of those they knowingly hire to fraudulently send spam to consumers on their behalf.

I ask unanimous consent to have printed in the Record a number of letters I have received in support of this provision.

Madam President, the House will adopt a similar provision in any House spam bill. I have received support for the provision from every sector involved in the spam debate--consumers' groups, e-mail providers, marketers, advertisers, online and offline retailers, technology companies and the U.S. Chamber of Commerce.

I urge my colleagues to join me in responding to the demands of millions of American consumers in doing all that we can to try to stop spam. I urge them to support passage of the CAN-SPAM Act.

My comments were a little lengthy, and I apologize. This is a very serious and important and complex issue, as I stated at the beginning of my remarks. That is why my two colleagues have spent 4 years working on this issue. I think they would be the first to agree that this may not stop spam.

There are some very smart people out there who will do everything they can for avoidance, including this issue I mention of organizations outside the United States. For us to do nothing would be a great disservice to millions of Americans, including the young ones, the majority of whom in America are regular users of computers.

I thank my colleagues, Senator Wyden and Senator Burns. For the benefit of my colleagues, we have three or four amendments. Maybe one or two might require a vote. I hope we can dispose of this legislation in a fairly short period of time.

I yield the floor.

Madam President, I believe the Senator from Oregon has a technical amendment and maybe would like to propose that at this time. It is my understanding that the Senator from New York, Mr. Schumer, is on his way over to propose his Do Not Spam amendment.

It is also my understanding that Senator Hatch, Senator Santorum, and Senator Corzine are the ones who have amendments. I would urge them to come forward when it is convenient so we can dispense with those amendments in a timely fashion.

I yield the floor.

Madam President, we support the amendment. It is helpful to the legislation. I urge its adoption.

Madam President, I move to reconsider the vote.

Madam President, we would like to, obviously, finish the bill as expeditiously as possible and yet offer all Members the opportunity to propose amendments. As I understand it right now, we have pending amendments by Senators Corzine, Santorum, and Hatch.

As Members know, there is a briefing at 4 p.m. by the Secretary of Defense for all Members in room 407. Shortly before 4, I would like to propose a unanimous consent agreement to lock in all amendments with no time agreements agreed to. I ask my colleagues who may have additional amendments to let us know between now and shortly before the hour of 4, which is over a half an hour.

I will also say we are asking Senators Hatch, Santorum, and Corzine to come over to offer their amendments so we can dispose of those amendments.

Amendment No. 1892

Mr. McCain. Madam President, I wish to make a few comments about Senator Schumer's amendment regarding the Do Not Spam list. As Senator Schumer pointed out, it authorizes the Federal Trade Commission to develop a Do Not Spam list similar to the Do Not Call list which has been widely supported by Americans across the country.

The Senator from New York and I remember when apparently perhaps, in the view of some, a misguided member of the judiciary stayed the Do Not Call list and the reaction that followed was certainly extraordinary. If we are able technologically to develop a Do Not Spam list, I think it would be of great assistance to many Americans. So I think the Senator from New York has a remarkable idea here.

As a first step, the FTC, which has testified they have some technological reservations about creating such a list, although I am sure the FTC would not object to it in principle, but they have some reservations, Senator Schumer has modified his amendment so that the FTC would be required to submit a report to the Congress within 6 months. It contains a plan for implementing the Do Not Spam list. The FTC would be authorized to implement the list 3 months later, and I would certainly urge them to do so.

As everyone is aware by now, there has been a tremendous amount of discussion about this issue. I believe it is a good one and one that provides the FTC with the authority to establish such a registry if they believe it is the proper mechanism to stop the onslaught of spam to consumers.

I think we have given them the flexibility to come back and show us if there are serious problems. If there are serious problems, we would be glad to look at them and help resolve those problems through any kind of legislative or other assistance we can provide.

The Schumer amendment also absolutely emphasizes this is an idea that has worked in the Do Not Call area and is a concept that should be pursued to the fullest extent of our capabilities. So I thank the Senator. I also thank Senator Nelson, a valued member of the committee, for his involvement in this issue.

Again, I hope Senators who have amendments will come to the floor and let us know about them.

I am glad to yield.

I am glad to yield, but first, to add to my remarks, I believe Senator Enzi may have an amendment as well.

I thank my friend from New York for his comments and I yield to the Senator from Oregon.

Madam President, I again urge my colleagues, particularly Senators Santorum, Hatch, Corzine, and Enzi, to come to the floor to give us their amendments so we can move expeditiously.

I also intend to propose a unanimous consent agreement in about 15 minutes that there be no further amendments in order at that time.

I suggest the absence of a quorum.

I thank Senator Hatch and Senator Leahy for their work to improve the criminal provisions and strengthen the Burns-Wyden CAN-SPAM Act. The active participation of Senator Hatch and his committee on this issue has been extremely valuable.

I join my friend from Oregon in urging Senator Hatch to have oversight on how this law is enforced and that it is properly done. We face challenges in enforcement of this act, particularly in light of the changes in technology that will inevitably occur which will make this legislation even harder to enforce than it is today. I thank Senator Hatch, and I urge adoption of the amendment.

Madam President, I ask consent that the following amendments be the only first-degree amendments in order to the bill and that they be subject to second-degrees which would be relevant to the first degree to which they are offered: Corzine amendment, Santorum amendment, Enzi amendment, Landrieu amendment, and Boxer amendment.

I do modify my request.

Pending and about to be adopted.

Mr. President, I thank Senator Leahy for his work on this amendment, along with Senator Hatch, who lends and contributes a great deal of teeth to this bill. I know they have worked very hard.

As I mentioned to Senator Hatch, as did the Senator from Oregon, we know that the Senator and his committee will be involved in the oversight of the enforcement of this legislation. We thank you for his valuable contribution.

I urge the sponsors of those amendments, Senators Corzine, Santorum, Enzi, Landrieu, Boxer, and Harkin, to please come to the floor in courtesy to their colleagues so we can take up and dispose of these amendments. Please show some courtesy to your colleagues. If you have amendments pending, please come. We are ready for them.

I yield the floor.

Madam President, I send an amendment to the desk on behalf of Senators Santorum and Enzi, and I ask for its immediate consideration.

Madam President, I ask unanimous consent that reading of the amendment be dispensed with.

Madam President, this amendment by Senators Santorum and Enzi requires warning labels on sexually explicit commercial e-mail to regulate interstate commerce by imposing limitations and penalties on the transmission of unsolicited commercial electronic mail via the Internet.

Basically, this amendment says no person may initiate or affect interstate commerce the transmission, to a protected computer, of any unsolicited commercial electronic mail message that includes sexually oriented material and fail to include in the subject heading for the electronic mail message the marks or notices prescribed by the Commission, or fail to provide that the matter in the message that is initially viewable to the recipient, when the message is opened by any recipient, and absent any further actions by the recipient, includes only to the extent required or authorized pursuant to any such marks or notices; the information required to be included in the message is clear.

This amendment also prescribes that not later than 120 days after the date of the enactment of this act, the Commission, the Federal Trade Commission, in consultation with the Attorney General, shall prescribe clearly identifiable marks or notices to be included in or associated with unsolicited commercial electronic mail that contains sexually oriented material, in order to inform the recipient of this message, of the material, of that fact to facilitate filtering of such electronic mail.

As all of us have discussed in consideration of this bill, one of the great concerns all of us have is pornographic material that is transmitted in the form of spam. According to several experts, 20 percent of unsolicited spam is pornography. This is an effort on the part of Senators Enzi and Santorum to try to at least begin addressing this issue. It is a valuable and important contribution in the form of trying to identify it and to bring it under control. It would make it a crime to send unsolicited e-mail that contains sexually oriented material unless they labeled it as prescribed by the FTC. The criminal penalties for this section would be the same as those contained in the Hatch-Leahy amendment.

I strongly support the amendment and urge its adoption.

Madam President, for the benefit of my colleagues, we have a Landrieu amendment which the Senator from Louisiana has been kind enough to withdraw, but we need to discuss what we need to do in the form of sending a letter to the Federal Trade Commission instructing them to take certain actions which I will discuss in a minute; a Corzine amendment which has two parts to it, which both sides have agreed to; and then I don't believe there will be any further amendments, although that is not completely clear. We could expect a vote on final passage relatively soon.

Senator Landrieu was going to offer an amendment that would have required the Consumer Product Safety Commission to undertake a rulemaking to have manufacturers create a database for consumers to be notified of certain product recalls. I have committed to Senator Landrieu to work with the CPSC to solicit these views on her legislation and ask how best to accomplish her worthy goals of better informing consumers about product recalls.

Senator Landrieu has hit on a very important issue. Unless you happen to see it by accident mentioned on television, the recalls are very seldom

known by at least a majority of those who would be affected by it. I commit to Senator Landrieu to see how we can best accomplish that. I appreciate her forbearance at this time in withdrawing the amendment. I hope we can satisfy her concerns by asking for rapid action on the part of the Consumer Product Safety Commission.

I yield the floor.

Madam President, as we are nearing the end, I am waiting for the Corzine amendment that we will discuss and adopt. Then I believe we will be able to move to final passage. I am not positive, but I think we will be able to. I would like to again express my appreciation to the Senator from Montana, Mr. Burns, and Senator Wyden. Four years is a long time to work on a single issue. When these two Senators began work on this issue, spam was minuscule as compared to what it is today. I must admit, I didn't pay much attention to it then, nor did the members of the Commerce Committee, nor the oversight agencies. Both Senators had the foresight to see the incredible proportions that this spamming would reach and the effect that it would have not only on our ability to use e-commerce and e-communications but also on our ability to improve productivity.

The costs involved in the spamming issue are pretty incredible when you count it all up according to certain experts.

So I thank our staffs who have worked on this for so long. Without the leadership of the Senator from Montana, Mr. Burns, and that of Senator Wyden, we would not have been able to move this, after several hearings in the Commerce Committee, to the floor of the Senate. I have some confidence that our friends on the other side of the Capitol will act with some dispatch since they are as wary as we are of the gravity of this problem. As soon as we get the Corzine amendment, we will move forward.

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

Madam President, I ask unanimous consent that we lay aside the pending amendment so Senator Harkin may be recognized.

Amendment No. 1895

Mr. President, I ask unanimous consent that Senator Hatch be added as a cosponsor to the Enzi-Santorum amendment No. 1894, and I ask unanimous consent that I be added as a cosponsor of S. 877.

Mr. President, I think the amendment of the Senator from Iowa is a worthy cause. We appreciate very much Senator Harkin's continued commitment to those who are hearing impaired in America. He has been a consistent and longtime advocate of this group of Americans. I thank him for his other contributions.

I urge adoption of the amendment.

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Mr. President, Senator Santorum would like to speak about the Santorum-Enzi amendment, and then we will have the Corzine amendment, which I will propose, and then we will be ready, I believe, for final passage.

I yield the floor.

Mr. President, I assure the Senator from Pennsylvania that we will do everything we can to hold it. I have to tell my friend from Pennsylvania that probably the greatest single aspect of this spamming that is so disturbing to families all over America is the issue the Senator from Pennsylvania raises, and that is this graphic pornography that pops into view when children are trying to do their homework, much less other entertaining aspects of using the computer.

I want to work with the Senator from Pennsylvania in every way we can to see if we can enact whatever safeguards to prevent this pollution of young Americans' minds.

Mr. President, as we await the completion of the Corzine amendment, I suggest the absence of a quorum.

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

I believe the pending amendment is the Santorum-Enzi amendment.

Mr. President, we have discussed this amendment and we have now received clearance from both sides of the aisle and I urge its adoption.

I am told by the staff that we will commence this vote at 6:30. I hope by that time we would have the final writing of the Corzine amendment, which I could propose at that time and have adopted since it is agreed to by both sides. We are waiting for that. Is that correct?

It has been resolved. We are just waiting for the language to be done. We may have to fire some staff people, I am afraid. Senator Wyden was writing them before.

Let me put it this way: I ask unanimous consent that after the adoption of the Corzine amendment, the bill be read a third time and a final vote be taken at 6:30, with the understanding that if the Corzine amendment is not adopted that would not happen.

On behalf of Senator Corzine, I have an amendment at the desk. I ask for its immediate consideration.

Mr. President, I support the amendment by Senator Corzine. I thank my colleagues for reaching a compromise at this time. I thank those who rapidly wrote this amendment on short notice so we could complete work on this legislation.

The amendment has two components. The first part addresses labeling of unsolicited commercial e-mail with the term ADV and also addresses the possibility of industry self-regulation. The Federal Trade Commission has raised serious concerns with both of these proposals with respect to ADV labeling. The FTC has written to me in opposition to labeling:

First, consumer groups, ISPs, and emailers at the SPAM

Forum roundly criticized the mandatory use of an ``ADV''

label. Labeling requirements could harm legitimate marketers,

while illegitimate marketers are likely to ignore the

requirement. Indeed, although several States require ``ADV''

labels on unsolicited commercial email, in its recent study

on False Claims in SPAM, Commission staff found that only 2

percent of email messages analyzed contained such a label.

In lieu of Senator Corzine's original proposal to make ADV labeling an industry self-regulation, the amendment has been modified to require the Federal Trade Commission to report to Congress on whether the ADV labeling and industry self-regulation should be implemented.

So I think this is a sensible solution in light of the Federal Trade Commission's concerns as I just read from their report to Congress.

The second part of the amendment would authorize the Federal Trade Commission to adopt a bounty hunter proposal to give people a portion of the fines collected from spammers that they hope to catch. As with the Do Not Spam Registry, the FTC would be authorized to act after first sending a report to Congress.

I support the amendment.

Mr. President, I suggest the absence of a quorum. Under the previous order, I believe the vote will start at 6:30.

Reserving the right to object.

Where is the Hatch-Leahy amendment?

It is not precluded by the unanimous consent request.

Mr. President, when the Senator from Arizona asked to make his unanimous consent request, I was in the process of answering the question of the Senator from Florida, who has spoken to me many times about his interest in these areas.

I appreciate what he has done to strengthen this legislation.

We keep the authority to set sentences where it belongs, with the Sentencing Commission, while remaining deferential, to the discretion of prosecutors.

The provisions from the Senator from Florida make it unmistakably clear that Congress expects this legislation to be used not just to punish spammers but also to dismantle criminal operations that are carried out with spam and other unsolicited bulk e-mail.

I also would note that the Senator from Florida has spoken about spam evolving from being just a nuisance. He is absolutely right. Serious crimes are being committed using this medium, which reaches a large number of people. Senior citizens are more and more often targeted to being bilked out of millions of dollars, and with very little effort on the part of the spammers.

Mr. President, I will engage in a colloquy with Senator Nelson because I think it is important for the purposes of the Record. With all the work the Senator from Florida has done, I want the Record to be very clear.

I would be pleased to engage in a colloquy with the Senator from Florida.

The Senator from Florida is correct. Nowadays, we see that spam has moved far beyond being just a nuisance to people trying to use email on their personal computers. Serious crimes are being committed using this medium, which can reach large numbers of people in a matter of seconds. For example, if a person or organization seeks to commit fraud to bilk senior citizens out of their money, with spam they can reach millions of potential victims at very low, even negligible costs. With such low costs, and such wide reach, even a small rate of success can make for a very profitable criminal enterprise.

The Senator from Florida has made me aware of his interest in these provisions on several occasions, and I appreciate his contributions to this effort. They strengthen the legislation in important ways. While keeping the authority to set sentences where it belongs--with the Sentencing Commission--and while remaining deferential to the discretion of prosecutors, these provisions makes unmistakably clear that Congress expects this legislation to be used not just to punish spammers, but also to dismantle the criminal enterprises that are carried out with spam and other unsolicited bulk e-mail.

Mr. President, it is increasingly obvious that unwanted commercial e-mail is more than just a nuisance. Businesses and individuals sometimes have to wade through hours of spam. It makes it impossible for them to do their work. It slows down whole enterprises.

In my home State of Vermont, one legislator logged on to his server and found that two-thirds of the e-mails in his inbox were spam. Our legislator is a citizen or legislature. He does not have staff or anything else. This was after the legislator had installed spam- blocking software. His computer stopped about 80 percent of it. But even

after he blocked 80 percent, two-thirds of the e-mail he had was spam.

The e-mail users are having the online equivalent of the experience of the woman in the classic Monty Python skit. She wanted to order a Spam-free breakfast at a restaurant. Try as she might, she cannot get the waitress to bring her the meal she wants. Every dish in the restaurant comes with Spam; it is just a matter of how much. There is eggs, bacon, and Spam; eggs, bacon, sausage, and Spam; Spam, bacon, sausage, and Spam; Spam, egg, Spam, Spam, bacon, and Spam; Spam, sausage, Spam, Spam, Spam, bacon, Spam, tomato, and Spam, and so on. Finally, the customer said: I don't like Spam. I don't want Spam. I hate Spam.

Now, I repeat that with apologies to John Cleese and everybody else in the Monty Python skit.

Mr. President, anybody who goes on e-mail, including every member of my family down to my 5-year-old grandchild, knows how annoying spam can be.

A Harris poll taken last year found that 80 percent of the respondents viewed spam as ``very annoying'' and 74 percent wanted to make it illegal.

Some 30 States now have anti-spam laws but it is difficult to enforce them.

There are actually billions of unwanted e-mails that are blocked by ISPs every day. Hundreds of millions of spam e-mails get through just the same.

Now, we have to be very careful when we regulate in cyberspace. We must not forget that spam, like more traditional forms of commercial speech, is protected by the first amendment. We cannot allow spam to result in the ``virtual death'' of the Internet, as one Vermont newspaper put it.

So what Senator Hatch and I have offered and is being accepted--the Hatch-Leahy-Nelson-Schumer amendment--would, first, prohibit hacking into another person's computer system and sending bulk spam from or through that system.

Second, it would prohibit using a computer system that the owner makes available for other purposes as a conduit for bulk spam, with the intent to deceive the recipient as to where the spam came from.

The third prohibition targets another way that outlaw spammers evade ISP filters: falsifying the ``header information'' that accompanies every e-mail and sending bulk spam containing that fake header information. The amendment prohibits forging information regarding the origin of the e-mail message.

Fourth, the Hatch-Leahy-Nelson-Schumer amendment prohibits registering for multiple e-mail accounts or Internet domain names and sending bulk mail from those accounts or domains.

Fifth, and finally, our amendment addresses a major hacker spammer technique for hiding identity that is a common and pernicious alternative to domain name registration--that is, hijacking unused expanses of Internet address space and using them to launch junk mail.

Now, penalties under the amendment are tough, but they are measured. Recidivists and those who send spam in furtherance of another felon may be imprisoned for up to 5 years. The sound of a jail cell closing for 5 years should focus their attention.

Large-volume spammers, those who hack into another person's computer system to send bulk spam, and spam ``kingpins'' who use others to operate their spamming operations may be imprisoned for up to 3 years, and so on.

Then, of course, we direct the Sentencing Commission to look at other areas.

So, Mr. President, I see my colleagues on the floor, Senator Burns and Senator Wyden, who have done yeoman work on this legislation. I compliment all those who worked together. I certainly compliment the two of them, as well as Senator Hatch, Senator Nelson, and Senator Schumer. I think we are putting together something that is worth passing.

Sure.

Mr. President, I thank my dear friend from Oregon for his far too generous words. I have enjoyed working with him. He has carried over from his service in the other body. He has a strong interest in this. Just as important as his strong interest is the fact he has extraordinary expertise in this area. That is very helpful.

If you would allow me one quick personal story. This sort of humbles you. I like to think I am very knowledgeable on this. My 5-year-old grandson climbed in my lap and asked me to log on to a particular interactive site for children. It is something he could do himself, but we don't let him log on himself because of the problems with some sites that appear to be for children, and are anything but.

So I log on for him, and he climbs up on my lap, takes the mouse out of my hand and says: I better take over now because it gets very complicated.

In some ways we are protecting those 5-year-olds because they are the next generation using this technology. I thank my friend from Oregon and good friend from Montana for the enormous amount of work they have done here.

I yield the floor.

Mr. President, it is increasingly apparent that unwanted commercial e-mail, commonly known as ``spam,'' is more than just a nuisance. In the past few years, it has become a serious and growing problem that threatens to undermine the vast potential of the Internet.

Businesses and individuals currently wade through tremendous amounts of spam in order to access e-mail that is of relevance to them--and this is after ISPs, businesses, and individuals have spent time and money blocking a large percentage of spam from reaching its intended recipients.

In my home State of Vermont, one legislator recently found that two- thirds of the 96 e-mails in his inbox were spam. And this occurred after the legislature had installed new spam-blocking software on its computer system that seemed to be catching 80 percent of the spam. The assistant attorney general in Vermont was forced to suggest to computer users the following means to avoid these unsolicited commercial e- mails: ``It's very bad to reply, even to say don't send anymore. It tells the spammer they have a live address . . . The best thing you can do is just keep deleting them. If it gets really bad, you may have to change your address.'' This experience is echoed nationwide.

E-mail users are having the online equivalent of the experience of the woman in the Monty Python skit, who seeks to order a Spam-free breakfast at a restaurant. Try as she might, she cannot get the waitress to bring her the meal she desires. Every dish in the restaurant comes with Spam; it's just a matter of how much. There's ``egg, bacon and Spam''; ``egg, bacon, sausage and Spam''; ``Spam, bacon, sausage and Spam''; ``Spam, egg, Spam, Spam, bacon and Spam''; ``Spam, sausage, Spam, Spam, Spam, bacon, Spam, tomato and Spam''; and so on. Exasperated, the woman finally cries out: ``I don't like Spam! . . . I don't want ANY Spam!''

Individuals and businesses are reacting similarly to electronic spam. A Harris poll taken late last year found that 80 percent of respondents view spam as ``very annoying,'' and fully 74 percent of respondents favor making mass spamming illegal. Earlier this month, more than 3 out of 4 people surveyed by Yahoo! Mail said it was ``less aggravating to clean a toilet'' than to sort through spam. Americans are fed up.

Some 30 States now have antispam laws, but the globe-hopping nature of e-mail makes these laws difficult to enforce. Technology will undoubtedly play a key role in fighting spam, but a technological solution to the problem is not likely in the foreseeable future. ISPs block billions of unwanted e-mails each day, but spammers are winning the battle.

Millions of unwanted, unsolicited commercial e-mails are received by American businesses and individuals each day, despite their own, additional filtering efforts. A recent study by Ferris Research estimates that spam costs U.S. firms $8.9 billion annually in lost worker productivity, consumption of bandwidth, and the use of technical support to configure and run spam filters and provide helpdesk support for spam recipients.

The costs of spam are significant to individuals as well, including time spent identifying and deleting spam, inadvertently opening spam, installing and maintaining antispam filters, tracking down legitimate messages mistakenly deleted by spam filters, and paying for the ISP's blocking efforts.

And there are other prominent and equally important costs of spam. It may introduce viruses, worms, and Trojan horses into personal and business computer systems, including those that support our national infrastructure.

The public has recently witnessed the potentially staggering effects of a virus, not only through the Blaster case I discussed earlier, but with the appearance of the SoBigF virus just 8 days after Blaster began chewing its way through the Internet. This variant also infected Windows machines via e-mail, then sent out dozens of copies of itself. Antivirus experts say one of the main reasons virus writers continue to modify and re-release this particular piece of ``malware'' is that it downloads a Trojan horse to infected computers, which are then used to send spam.

Spammers are constantly in need of new machines through which to route their garbage e-mail, and a virus makes a perfect delivery mechanism for the engine they use for their mass mailings. Some analysts said the SoBigF virus may have been created with a more malicious intent than most viruses, and may even be linked to spam e- mail schemes that could be a source of cash for those involved in the scheme.

The interconnection between computer viruses and spam is readily apparent: Both flood the Internet in an attempt to force a message on people who would not otherwise choose to receive it. Criminal laws I wrote prohibiting the former have been invoked and enforced from the time they were passed it is the latter dilemma we must now confront headon.

Spam is also fertile ground for deceptive trade practices. The FTC has estimated that 96 percent of the spam involving investment and business opportunities, and nearly half of the spam advertising health services and products, and travel and leisure, contains false or misleading information.

This rampant deception has the potential to undermine Americans' trust of valid information on the Internet. Indeed, it has already caused some Americans to refrain from using the Internet to the extent they otherwise would. For example, some have chosen not to participate in public discussion forums, and are hesitant to provide their addresses in legitimate business transactions, for fear that their e- mail addresses will be harvested for junk e-mail lists. And they are right to be concerned. The FTC found spam arriving at its computer system just 9 minutes after posting an e-mail address in an online chat room.

I have often said that Congress must exercise great caution when regulating in cyberspace. Any legislative solution to spam must tread carefully to ensure that we do not impede or stifle the free flow of information on the Internet. The United States is the birthplace of the Internet, and the whole world watches whenever we decide to regulate it. Whenever we choose to intervene in the Internet with government action, we must act carefully, prudently, and knowledgeably, keeping in mind the implications of what we do and how we do it. And we must not forget that spam, like more traditional forms of commercial speech, is protected by the first amendment.

At the same time, we must not allow spam to result in the ``virtual death'' of the Internet, as one Vermont newspaper put it.

The Internet is a valuable asset to our Nation, to our economy, and to the lives of Americans, and we should act prudently to secure its continued viability and vitality.

On June 19 of this year, Senator Hatch and I introduced S.1293, the Criminal Spam Act, together with several of our colleagues on the Judiciary Committee. On September 25, the committee unanimously voted to report the bill to the floor. Today, Senators Hatch, Nelson, Schumer, Grassley and I offered the criminal provisions of S. 1293 as an amendment to S. 877, the CAN SPAM Act. The amendment was adopted by voice vote.

I thank the lead cosponsors of S. 877 for working with us on this amendment, and for their support and cosponsorship of the Criminal Spam Act. I also thank Senator Bill Nelson for his contribution to the amendment.

The Hatch-Leahy amendment prohibits five principal techniques that spammers use to evade filtering software and hide their trails.

First, our amendment prohibits hacking into another person's computer system and sending bulk spam from or through that system. This criminalizes the common spammer technique of obtaining access to other people's e-mail accounts on an ISP's e-mail network, whether by password theft or by inserting a ``Trojan horse'' program--that is, a program that unsuspecting users download onto their computers and that then takes control of those computers--to send bulk spam.

Second, our amendment prohibits using a computer system that the owner makes available for other purposes as a conduit for bulk spam, with the intent of deceiving recipients as to the spam's origins. This prohibition criminalizes another common spammer technique--the abuse of third parties' ``open'' servers, such as e-mail servers that have the capability to relay mail, or Web proxy servers that have the ability to generate ``form'' mail. Spammers commandeer these servers to send bulk commercial e-mail without the server owner's knowledge, either by ``relaying'' their e-mail through an ``open'' e-mail server, or by abusing an ``open'' Web proxy server's capability to generate form e- mails as a means to originate spam, thereby exceeding the owner's authorization for use of that e-mail or Web server. In some instances the hijacked servers are even completely shut down as a result of tens of thousands of undeliverable messages generated from the spammer's e- mail list.

The amendment's third prohibition targets another way that outlaw spammers evade ISP filters: falsifying the ``header information'' that accompanies every e-mail, and sending bulk spam containing that fake header information. More specifically, the amendment prohibits forging information regarding the origin of the e-mail message, and the route through which the message attempted to penetrate the ISP filters.

Fourth, the Hatch-Leahy amendment prohibits registering for multiple e-mail accounts or Internet domain names, and sending bulk e-mail from those accounts or domains. This provision targets deceptive ``account churning,'' a common outlaw spammer technique that works as follows. The spammer registers--usually by means of an automatic computer program--for large numbers of e-mail accounts or domain names, using false registration information, then sends bulk spam from one account or domain after another. This technique stays ahead of ISP filters by hiding the source, size, and scope of the sender's mailings, and prevents the e-mail account provider or domain name registrar from identifying the registrant as a spammer and denying his registration request. Falsifying registration information for domain names also violates a basic contractual requirement for domain name registration falsification.

Fifth and finally, our amendment addresses a major hacker spammer technique for hiding identity that is a common and pernicious alternative to domain name registration--hijacking unused expanses of Internet address space and using them as launch pads for junk e-mail. Hijacking Internet Protocol--IP--addresses is not difficult: Spammers simply falsely assert that they have the right to use a block of IP addresses, and obtain an Internet connection for those addresses. Hiding behind those addresses, they can then send vast amounts of spam that is extremely difficult to trace.

Penalties for violations of these new criminal prohibitions are tough but measured. Recidivists and those who send spam in furtherance of another felony may be imprisoned for up to 5 years. Large-volume spammers, those who hack into another person's computer system to send bulk spam, and spam ``kingpins'' who use others to operate their spamming operations may be imprisoned for up to 3 years. Other offenders may be fined and imprisoned for no more than one year. Convicted offenders are also subject to forfeiture of proceeds and instrumentalities of the offense.

In addition to these penalties, the Hatch-Leahy amendment directs the Sentencing Commission to consider providing sentencing enhancements for those convicted of the new criminal provisions who obtained e-mail addresses through improper means, such as harvesting, and those who knowingly sent spam containing or advertising a falsely registered Internet domain name. We have also worked with Senator Nelson on language directing the Sentencing Commission to consider enhancements for those who commit other crimes that are facilitated by the sending of spam.

I should note that the Criminal Spam Act, from which the amendment is taken, enjoys broad support from ISPs, direct marketers, consumer groups, and civil liberties groups alike. It is also supported by the administration: In its September 11, 2003, views letter regarding the CAN SPAM Act, the administration advocated the addition to CAN SPAM of felony triggers similar to those proposed in the Criminal Spam Act. The administration further supported our proposal, advanced in the Hatch- Leahy amendment, to direct the Sentencing Commission to consider sentencing enhancements for convicted spammers that have additionally obtained e-mail addresses by harvesting.

Again, the purpose of the Hatch-Leahy amendment is to deter the most pernicious and unscrupulous types of spammers--those who use trickery and deception to induce others to relay and view their messages. Ridding America's inboxes of deceptively delivered spam will significantly advance our fight against junk e-mail. But it is not a cure-all for the spam pandemic.

The fundamental problem inherent to spam--its sheer volume--may well persist even in the absence of fraudulent routing information and false identities. In a recent survey, 82 percent of respondents considered unsolicited bulk e-mail, even from legitimate businesses, to be unwelcome spam. Given this public opinion, and in light of the fact that spam is, in essence, cost-shifted advertising, we need to take a more comprehensive approach to our fight against spam.

While I am generally supportive of the CAN SPAM Act, and will vote in favor of passage, it does raise some concerns. The bill takes an ``opt out'' approach to spam--that is, it requires all commercial e-mail to include an ``opt out'' mechanism, by which e-mail recipients may opt out of receiving further unwanted spam. My concern is that this approach permits spammers to send at least one piece of spam to each e- mail address in their database, while placing the burden on e-mail recipients to respond. People who receive dozens, even hundreds, of unwanted e-mails each day may have little time or energy for anything other than opting-out from unwanted spam.

According to one organization's calculations, if just one percent of the approximately 24 million small businesses in the U.S. sent every American just one spam a year, that would amount to over 600 pieces of spam for each person to sift through and opt out of each day. And this figure may be conservative, as it does not include the large businesses that also engage in online advertising.

I am also troubled by the labeling requirement in the CAN SPAM Act, which makes it unlawful to send an unsolicited commercial e-mail message unless it provides, among other things, `` clear and conspicuous identification that the message is an advertisement or solicitation,'' and ``a valid physical postal address of the sender''. While we all want to curb spam, we must be mindful of its status as protected commercial speech, and ensure that any restrictions we impose on it are as narrowly tailored as possible.

Reducing the volume of junk commercial e-mail, and so protecting legitimate Internet communications, is not an easy matter. There are important First Amendment interests to consider, as well as the need to preserve the ability of legitimate marketers to use e-mail responsibly. We must be sure we get this right, so as not to exacerbate an already terribly vexing problem. This is especially important given the preemption provisions of the CAN SPAM Act, which will override many of the tough anti-spamming laws already enacted by the States.

My distinguished colleagues from Wyoming and Pennsylvania offered an amendment requiring ``warning labels'' on certain commercial electronic mail. While I appreciate my colleagues' efforts to protect our children from the on-line assault of internet pornography--an important goal that we all share--I fear the amendment has been drafted in haste and raises significant constitutional issues that require further analysis.

First, the amendment incorporates broad and vague phrases such as ``devoted to sexual matters'' that are not otherwise defined in the law. I expressed similar concerns during debate on the Communications Decency Act, CDA, which the Supreme Court struck down as unconstitutional in 1996. The CDA also punished as a felony anyone who transmitted ``obscene'' or ``indecent'' material over the Internet. The CDA was deemed too vague as to what was ``indecent'' or ``obscene.'' Some of the terms and phrases used in the Enzi-Santorum amendment may be deemed equally vague when subjected to judicial scrutiny.

There are also first amendment concerns to regulating commercial electronic mail in ways that require specific labels on protected speech. Such requirements inhibit both the speaker's right to express and the listener's right to access constitutionally protected material.

More importantly, existing laws already ban obscenity, harassment, child pornography and enticing minors into sexual activity.

As a father and a grandfather, I well appreciate the challenge of limiting a child's exposure to sexually inappropriate material. Yet, no legislation we could pass would be an effective substitute for parental involvement. We must be vigilant about feel-good efforts to involve government, either directly or indirectly, in regulating the content of the Internet.

For these reasons, the Enzi-Santorum amendment raises serious legal issues that mandate further exploration before a determination can be made on the proposed law's constitutional viability.

I look forward to continuing to work with the sponsors of the CAN SPAM Act on these issues as the bill proceeds to conference.

Madam President, kingpin spammers who send out emails by the millions are threatening to drown the Internet in a sea of trash. The American people want it stopped. Every single day the Senate delays, these big-time spammers, the ones who are trying to take advantage of the open and low-cost nature of the Internet, gives them another opportunity to crank up their operations to even more dizzying levels of volumes.

Every Member of the Senate is hearing from citizens. This is a consumer abuse that is visited on millions of people every day. It is now time to put in

place strong enforcement tools to protect the public.

Many are asking, what is the role of Federal legislation? My colleagues have talked a bit about there not being a silver bullet. The key is to pass this bill and come down on the violators with hobnail boots. It is fair to say a lot of the big-time abusers are not exactly quaking today about the prospect of Senate action. They are not technological simpletons. They are very savvy and they figure any law that is passed by the Senate they can get out in front of.

What is going to be important is for those who are charged with enforcement--the Federal Trade Commission, the criminal authorities, we give a role to the State attorneys general, the Internet service providers--when this bill is signed into law, to bring a handful of actions very quickly to establish that for the first time there is a real deterrent, there will be real consequences when those big-time spammers try to exploit our citizens. When the bill takes effect, for the first time those violators are going to risk criminal prosecution, Federal Trade Commission enforcement, and million-dollar lawsuits by the State attorneys general and Internet service providers.

The reason that is the case is because big-time spammers have to violate this bill in order for their sleazy business to work. If they do not hide their identities, their messages end up getting filtered out by the Internet service providers. If they do not use misleading subject lines, people are going to click the messages straight into the trash, unread. It is costly to deal with thousands of demands for consumers to be removed from the lists. The day this bipartisan legislation becomes law, for the first time big-time spamming will become an outlaw business.

It is worth noting when Senator Burns and I started this effort nearly 4 years ago, we had the strong support of Senator McCain. Senator Hollings has been tremendous to me. I got involved in this shortly after joining the Commerce Committee. A lot of people asked, why in the world would Conrad Burns and I be spending our time on something like this. They essentially intimated this was not the kind of issue important enough for the Senate. They said, Senators deal with key matters. They deal with war and peace and entitlement programs. Why in the world would the Senate get involved with something like spam. It was only 6 to 8 percent when we started in 2000. Why is the Senate spending its time on that kind of concern? Suffice it to say, nobody is saying any longer spam is just a minor annoyance. Nobody is saying the delete key is now going to be a sufficient solution to the problem.

This is now something that threatens this medium. Spam, in the view of experts, and in my view, stunts the growth of e-commerce. And if it continues at the rate of growth we have seen in the last few years, I think it will engulf the entire medium.

So something the American people use every day, something that is considered a vibrant, exciting tool, that has empowered millions of people to learn, to be part of cultural activities, to start small businesses--if nothing is done, if somehow this legislation goes by the board or the Senate and House cannot agree, I think what we are seeing in the days ahead is a genuine threat to the entire medium.

So with respect to the specifics of the bill, I think there are a number of key provisions. One I have stressed is the question of misleading identities because I think that goes right to the heart of how you set in place a strong enforcement regime.

But I also emphasize the role of the States here this afternoon. At this point, over half the States have enacted State-level spam legislation. It is pretty easy to see why the States have acted. They are frustrated that the Congress has not moved.

But I believe a State-by-State approach cannot work in this area. The numerous State laws to date certainly have not put in place a coordinated effort against spam. Neither the Internet nor the big-time spammers is sitting around saying: Let's tip our hat to State jurisdictions. And certainly an e-mail address, unlike a phone number, does not reveal the State in which the holder of the address is located. So compliance with a patchwork of inconsistent State laws is virtually impossible, and spammers do not even go through the motions of trying.

What is needed is a uniform, nationwide spam standard to put the spammers on notice and to empower the consumers to have an enforcement regime consistent with their reasonable expectations.

Having emphasized the importance of a nationwide, uniform standard in this area, the legislation does preserve an important role for the States.

First, the State laws that address deception in spam--deception in spam--would be preserved. Second, general consumer protection fraud and computer abuse laws would remain enforceable as well. And third, the bill authorizes States' attorneys general to use the Federal statute to prosecute spammers.

The bottom line is, our States, which have done so much important and innovative work in the area of consumer protection, are going to remain active and important partners in the battle against spam.

Shortly, we will be talking about the Do Not E-mail Registry. I commend Senators Schumer and Dayton. Both of them have introduced legislation in this area. They deserve a great deal of credit with respect to their patience on this legislation. And we know it is a challenge. The telephone Do Not Call list is certainly facing a lot of battles.

But I think this is an important idea. I think it is an idea that makes a genuine contribution. It certainly is one that the American consumer wants. We are going to work with the sponsors, Senator Schumer and Senator Dayton, and others who have been so interested in this to address the various questions that have been brought up with respect to feasibility.

I also commend Senator Nelson of Florida. These big-time spammers-- there are only a few hundred of them. I think Senator McCain and I were struck, as we listened to the debate, at the fact that we are talking about a few hundred big-time violators. They seem to have gravitated to a couple States, particularly Florida and Texas.

Senator Nelson has been very interested in ensuring that there are tough enforcement provisions in this legislation. I share his view that we ought to use all of the enforcement tools, including measures such as the RICO statute, against these particularly reprehensible violators. I commend Senator Nelson for this effort as well.

Finally, as we put together a coordinated game plan against the spammers, I would also like to emphasize that we expect our trading partners, and the many countries that look to do business with the United States, to play a more activist role in this area. As sure as night follows day, some of these kingpin spammers are going to just move offshore and set up shop.

So as we look to the future, I have stressed enforcement. I think we need to see aggressive enforcement action the day this bill is signed into law. Then we have to push our trading partners around the world to work with us to ensure that, as part of a coordinated strategy, we are preventing the big-time violators from simply closing down in the United States and moving offshore.

I have tried to specialize in technology issues in my time in the Senate. My State cares greatly about this issue. I have been fortunate to have a chairman in Senator McCain who has always encouraged these efforts, to deal with Internet taxes, digital signatures, Y2K liability--and the list goes on and on. And Senator Hollings, who is not in the Chamber, has been extraordinarily supportive of my involvement in these issues.

But I think it is fair to say that this spam question--of all the technology issues we have tackled in the last few years in the Commerce Committee, I cannot think of another one that has inflamed consumers more, has been emphasized more to me at townhall meetings.

I can tell the Senate, at the time when we were all concerned about the well-being of our troops and the conflict in Iraq, folks would also say, in addition to standing up for our troops: Make sure you do something about spam as well. I think it is indicative of how much concern there is in the country with respect to these kingpin spammers who really do put at risk--I do not say this lightly--an entire medium that has made such a difference and been so important for millions of Americans.

We are going to deal expeditiously with the amendments. A number of colleagues have already asked of the managers what we thought the timetable of this bill would be. My guess is, we can deal with this legislation certainly within the next couple of hours, at most.

We urge Senators who have an interest in this matter to come to the floor. This is an opportunity for the Senate to stand up for the consumer.

We are not going to overpromise. We are not going to say that the day this bill is signed, spam will magically vanish into the vapor. But this legislation, coupled with an enforcement strategy that has the Federal Trade Commission, criminal authorities, pushing spam as it relates to these big-time violators up the priority list of the tasks that they face--that kind of strategy can make a difference.

Madam President, with that, I yield the floor.

Madam President, I send an amendment to the desk.

Madam President, I offer this amendment on behalf of myself and Senator Burns. It is technical in nature. I know of no opposition.

It clarifies that header information that is technically false, but in such a minor way as to be nonmaterial, will not be actionable under the legislation.

It clarifies that spammers who knowingly route messages through what are called open relays in order to erase the message's originating information--which is a technique used by these big-time spammers--will be treated as having used false or misleading header information.

It permits the Federal Trade Commission to modify the bill's deadline for how quickly ``opt-out requests'' must be processed. Currently, the bill says that 10 business days after receiving a consumer's opt-out request, any further e-mails from the sender become punishable.

The amendment permits the Federal Trade Commission to modify that time period if it finds that a different period would be appropriate. It permits the Federal Trade Commission, if it identifies new and particularly nefarious techniques used by spammers, to add those techniques to the list of what are called aggravated violations so that spammers who use those techniques would be subject to higher penalties.

Finally, this amendment, which has the support of Chairman McCain and Senator Hollings, would clarify that any lawsuits for violations of Federal spam rules should be brought in Federal court. It is noncontroversial in nature. I urge its passage.

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Amendment No. 1892

Madam President, I suggest the absence of a quorum.

Madam President, at this time, I ask unanimous consent that the previously agreed-to Burns-Wyden technical amendment, No. 1891, be modified with the change I now send to the desk.

Madam President, this is also a very modest technical amendment. This amendment simply ensures that the Do Not E-mail Registry proposed would be considered on the timetable that all of the parties who have worked on this had intended. It is very noncontroversial.

Will the Senator yield?

Madam President, I will be very short.

Without turning this into a bouquet-tossing contest, let me thank my friend from Florida. Of course, many of the worst violators are people I call kingpin spammers who are located in his home State. The Senator from Florida brought it to the attention of Senator Burns and I that to have an effective enforcement strategy, we had to have in place tools that would deal with the kind of shady operators who are present in his home State.

The Senator from Florida has hammered on that message. I think by the time we are done this afternoon and have Senator Leahy on the floor as well, Senator Nelson's contribution will be especially helpful, not just in Florida but in terms of dealing with these kingpin spammers, the people who send out millions of e-mail now without consequences.

I thank my colleague for yielding, and I thank him for keeping this issue on the radar.

I say to the Senator from New York, I appreciate his patience on this. I think he knows from the outset my concern was not with the nature of this, because clearly empowering consumers to make these kinds of choices is essential. What is important is to try to figure out how to do this right.

The Senator from New York knows people change their e-mail addresses constantly. In that sense, this is different than a telephone. We all understand that if a bad spammer, for example, one of these kingpin operators, was to hack into this, what a gold mine for an evil person who wanted to exploit our citizens. The Senator from New York has been acutely aware of it and that is why he has worked with me, Senator Burns, and all of those on the Commerce Committee. I commend him for his patience.

This is an important contribution. We have a lot of work to do, because we have seen with the Do Not Call list what the challenge is. I personally believe in the telecommunications area we ought to establish, as kind of a bedrock principle, that there is a First Amendment right to communicate, but there also is a right of the consumer to say, I have had it. In effect, that is what the Senator from New York is allowing us to do in the spam area, and to do it in a responsible way.

I thank my colleague from Arizona for giving me this time. With a little luck, we will be able to dispose of the additional spam amendments and send this bill on its way.

Madam President, will the Senator from Utah yield?

I commend the Senator from Utah for his efforts in this area. The contribution the Senator from Utah makes is not just useful but it is absolutely critical. We can write bills to fight spam until we run out of paper, but unless we have the kind of enforcement the Senator from Utah envisions, we are not going to get the job right.

I am particularly interested in working with the distinguished chairman of the Judiciary Committee in making sure we have some vigorous oversight after this bill is enacted into law. If after this bill is passed we have the prosecutors, the Federal Trade Commission, and others bring some tough enforcement actions, that will be a tremendously valuable deterrent.

I would like to work with the distinguished chairman of the committee to have some vigorous oversight hearings after this bill has gone into effect. That is what it is going to take to make sure we have the teeth in this legislation to make a difference. I thank my colleague.

I ask unanimous consent to add Senator Harkin's name to that list and then I support the unanimous consent.

Mr. President, just before he leaves the floor, I thank the distinguished Senator from Vermont for all his help. I have already told Senator Hatch how incredibly important the enforcement provision is. You can write bills forever, but without the enforcement to which the Senator from Vermont and the Senator from Utah are committed, those bills are not going to get the job done.

Suffice it to say, when there were a lot of people in public life who thought their computers were somehow a TV screen, the Senator from Vermont was already leading the Senate and those who work in the public policy arena to understand the implications of the medium.

There is nobody in public life whose counsel I value more on telecommunications and Internet policy than the distinguished Senator from Vermont. I appreciate his giving me this opportunity to work with him on the enforcement provisions. It will be the lifeblood of making this bill work.

Mr. President, we are very close to being able to pass this bill tonight. This is an extraordinarily important consumer measure, a measure that literally touches the lives of millions of people every single day. At this point, we have only three amendments left. The Senator from New Jersey, Mr. Corzine, has an amendment; the Senator from Wyoming, Mr. Enzi, is to offer an amendment with Senator Santorum; and then Senator Landrieu has an amendment.

I am very hopeful we will be able to finish this bill fairly shortly. I urge those Senators who have their amendments in order to come to the floor at this point. This is legislation that has been worked on for more than 4 years. During that time, this problem has grown exponentially. A number of Senators have spoken about it, and the Senate ought to move ahead.

I suggest the absence of a quorum.

Before the Senator from Tennessee leaves the floor, I say to him I have my hands full today with spam so I am not going to get into the substance of the Internet Tax Freedom Act that, as my friend knows, I have been a sponsor of in the Senate with Congressman Cox in the other body. I am always anxious to work with my colleague from Tennessee.

Essentially, the arguments being made today against the Internet Tax Freedom Act are identical to the ones that were made 5 years ago. If we were to look at the transcript 5 years ago before the Senate Commerce Committee, we were told the States and localities would be stripped of the revenue they needed. We were pretty much told western civilization was going to end at that time.

Ever since then, as we have gone through 5 years of experience, we have not seen that to be the case. States and localities have not been stripped of the revenue they need. Internet sales are still perhaps only 2 percent of the economy. No jurisdiction has shown that they have been hurt by their inability to discriminate against the Internet, and that is all this law stands for is technological neutrality, treating the online world like the offline world is treated.

As I said to my good friend, I have my hands full today with spam so we will debate the Internet Tax Freedom Act another day. I am anxious to work with my colleague. I would only point out the reauthorization of the Internet Tax Freedom Act passed the Commerce Committee unanimously. It is the first time since we have been at this that it has been passed unanimously. I think it is going to be an important debate I will certainly be anxious to talk with my colleague about at that time.

Again, we are hoping those with the amendments that have been made in order to the spam bill will come to the floor. We could finish this legislation in perhaps half an hour, pass a very important proconsumer measure by pretty close to a unanimous vote in the Senate. Senator Burns and I are certainly hoping that will be the case and hope in particular that Senator Corzine, Senator Enzi, and Senator Santorum will come to the floor and we could be done very quickly.

I suggest the absence of a quorum.

Madam President, let me associate myself with the remarks of the distinguished chairman of the committee. Every Member understands that pornography being transmitted through spam is a scourge. There is no question about it. What we have done, because we have just seen this, is we have asked the minority on the Judiciary Committee, under the leadership of Senator Leahy, to take a look at this. We are very hopeful that we will be able to approve this language in just a few minutes. Again, we are hoping that this bill will be passed, certainly within 20, 25 minutes, and we will have a comment from the Democrats on the Judiciary Committee very shortly.

I share Chairman McCain's view that this is an extremely important issue. When you think about spam, the first thing parents all over this country think about is the flood that is being targeted at families from coast to coast. I am hopeful we will get this approved in a matter of minutes.

I suggest the absence of a quorum.

Madam President, on behalf of the minority, Senator Hollings believes that Senator Landrieu is raising a very important issue for consumers and kids. We do want to work closely with her and move ahead on her initiative. It is an important one for families.

Madam President, I think we are about ready to actually move to final passage. We have the Corzine amendment and another one coming from the Senator from Iowa. I think we are very close to being able to move ahead.

I wish to express my thanks to the leadership of the committee and my partner for over 4 years, Senator Burns, on this legislation.

The bottom line here is that when this bill becomes law, big-time spamming, in effect, becomes an outlaw business. For the first time, the kingpin spammers are going to be at risk of Federal prosecution, Federal Trade Commission enforcement, million-dollar lawsuits by State attorneys general and Internet service providers. The reason that is the case is that big-time spammers would have to violate this bill in order for their sleazy operations to continue. If they don't hide their identity, their messages will get filtered out. If they don't use misleading subject lines, people are going to go click and these garbage messages will go straight into the trash unread.

It seems to me there is a chance now, recognizing that we still need international cooperation and tough enforcement, to make a very significant step forward for consumers all across the country.

I will conclude by way of saying that, again, I think enforcement is going to be the key to making this legislation work. When this bill is signed into law, I have been saying that the enforcers--the Justice Department, State attorneys general, Internet service providers, and others--have to be prepared to come down on those 200 or 300 big-time spammers with hobnail boots. A lot of them are not exactly quaking tonight at the prospect of Senate action. They are not convinced that the Senate is really going to insist on strong oversight. We saw today, because of what was said by Senator Hatch and Senator Leahy, that they are committed to strong enforcement and vigorous oversight.

I believe as a result of the attention the Senate has given to this issue, when this bill is signed into law, we are going to see very quickly a handful of very tough, significant enforcement actions with real penalties and the prospect of spammers going to jail and paying million-dollar fines. That is the kind of deterrence we need.

The text of this law is very important, but it is only as good a law as we see backed up by enforcement. We have a commitment today from Chairman Hatch and Senator Leahy to follow up and ensure that that kind of enforcement takes place. With that, I think we take a very significant step forward in terms of protecting the rights of consumers who right now find a blizzard of spam every single time they turn on their computer.

I yield the floor and I suggest the absence of a quorum.

Mr. President, on behalf of Senator Hollings, this is what we think Government ought to be about: going to bat for these people. I encourage the Senate to adopt the Harkin amendment.

Mr. President, very briefly, I think the Senator from Pennsylvania is trying to address a very important issue. We have asked for the Democrats on the Senate Judiciary Committee, under Senator Leahy's leadership, to take a look at it. I think we will have that answer quickly.

As the Senator knows, some of the definitions in this area can get fairly technical. We also understand that pornography, which is conveyed through spam across the Internet, is a real public scourge. We are interested in getting the Senator's amendment adopted. I am hopeful we will be able to support it.

Mr. President, I also support the amendment. This is a compromise. Both of these topics are topics about which we really have not heard a lot. We have not had a chance to discuss them in hearings. Senator Corzine has been working constructively with us. I urge the passage of it.

The bounty issue essentially comes from Professor Lessig at Stanford, looking at innovative ways to create incentives to deal with the problem. It is certainly one the Federal Trade Commission should look at. The question about making sure every unsolicited e-mail has ADV has been contentious among a number of small business groups, ones that have really been burdened by these costs. But I think this is a fair compromise. It gives the Federal Trade Commission ample opportunity to study this and look at the feasibility of it. I urge our colleagues to support it.

As soon as we agree to the Corzine amendment, I believe Senator Harkin has a unanimous consent request he needs to make, and then we are ready to go to final passage. I urge my colleagues now to support the Corzine amendment.

Madam President, I have an amendment at the desk.

I ask unanimous consent that reading of the amendment be dispensed with.

Madam President, I offer this amendment on behalf of myself, Senator Graham of South Carolina, Senator McCain, and Senator Hollings. I thank my good friend, Senator Lindsey Graham, who worked long and hard on this issue with me. Senator Graham and I have been working on quite a few pieces of legislation together. He is a good legislator and a fighter for the things in which he believes. We do not agree on everything, to say the least, but it is a pleasure to work with him.

I thank my colleagues, Senator Burns and Senator Wyden, both of whom have worked long and hard on this legislation for many years. They both were willing to work with me and accommodate some changes which I hope make the legislation better. I believe they do. But the foundation of this bill is their hard work. This is a good day for both of them because they have spent a long time and they deserve a great deal of accolades for their hard work on this important legislation which, hopefully, will pass today.

I thank my colleague, Senator Hollings, ranking member of the Commerce Committee, who offers this amendment along with myself, Senator Graham, and Senator McCain. We are all going to miss Fritz Hollings. He is one of the true gems of the Senate. He is a forthright man and a direct man. He is a smart man. He is a principled man. I, for one, know that my amendment might not have happened, certainly wouldn't be in the form it is now, without his intervention. I thank him for that.

Finally, Senator McCain and I have worked on a whole number of things together. It is a pleasure to work with him. Again, he is a man of his word. He is able to bring different people together to produce good legislation. He cares about the average person. He never lets any of the special interests get in his way. We wouldn't be here today without the Senator's leadership. I thank him very much.

Let me begin by saying how important this whole bill is to the continued vitality of e-mail and the Internet itself. Unsolicited e- mail has grown at astronomical rates over the past months. It is safe to say we are now under siege. Armies of online marketers have overrun e-mail inboxes across the country with advertisements for herbal remedies, get-rich-quick schemes, and, unfortunately, pornography. What was a simple annoyance last year has become a major concern this year and could cripple one of the greatest inventions of the 20th century next year if nothing is done.

Way back in 1999, the average e-mail user received just 40 pieces of unsolicited commercial e-mail, spam, each year. This year the number is expected to pass 2,500. I know that I am lucky if I don't get 40 pieces of spam every day. As a result, a revolution against spam is brewing as the epidemic against junk e-mail exacts an ever-increasing toll on families, businesses, and the economy.

Let me illustrate this point with a story. My wife and I have two wonderful daughters, one of whom is about to complete her first year at college; the other, a 14-year-old, is an absolute whiz on the Internet. She loves sending and receiving e-mails. As parents, we do our best to make sure she has good values and that the Internet is a positive experience for her, a device to help her with her school work or learn about events taking place around the world, and maybe even a way to order the latest In Sync CD, although I think she likes other groups better.

You can imagine my anger and dismay when I saw my daughter on e-mail. I would say: Great, she is not watching television. And then you can imagine my dismay when I discovered that not only was she a victim of spam like myself, but like all e-mail users, much of the junk mail she was receiving advertised pornographic Web sites. Some of the things that crossed her e-mail were things I would not want to see, let alone my 14-year-old daughter. I was and remain virtually powerless to prevent such garbage from reaching my daughter's inbox.

Recent surveys unambiguously show that the public shares my concern about spam infested with pornography and how it impacts their children. The bottom line is, if parents can control what their kids watch on TV, they should be able to control what their children are exposed to on the Internet. We have parental advisory notices on music, as well as ratings for TV shows and movies to ensure that parents are able to keep their children from being exposed to what they consider inappropriate. So it makes you scratch your head about why there is no safeguard in place to enable parents to protect their kids from vulgar e-mail. The e-mailing public has been at the mercy of spammers for long enough. They want to take back the Internet.

A recent survey conducted by UnSpam, one of the ardent foes of spam and backer of my legislation, and InSightExpress, a research group, backs that view. Here is a quick rundown of some of the highlights of the survey:

Almost 9 in 10 parents say they are seriously concerned about their children receiving inappropriate e-mail versus 5 percent who don't care. Ninety-six percent of parents want the ability to block pornography from their children's inboxes. A paltry 2 percent don't want that right. Ninety-five percent think children should be given extra protection under any anti-spam law, 3 percent undecided. And 93 percent think spammers should face enhanced penalties for sending inappropriate messages to children.

Our amendment is a solution that will give parents--the only solution--the ability to protect their children from offensive and obscene e-mail spam by registering their children's e-mail address. Parents across the country are increasingly worried about this problem, and we should do the right thing by giving them a registry. Parents and children are not the only ones who will benefit from a no e-mail registry. Business owners and ISPs across the Nation can identify with the frustration many of us feel in the battle against spam. With surveys showing that nearly 50 percent of e-mail traffic qualifies as spam, businesses spend millions of dollars each year on research- filtering software and new servers to deal with the ever expanding volume of junk e-mail being sent through the pipes.

According to Ferris Research, spam costs businesses in the United States $10 billion each year in lost productivity, consumption of information technology resources, and help desk time.

That is $10 billion that should be spent on growing American businesses and jobs instead of fighting spam.

The Do Not E-mail Registry created by the FTC would allow businesses to cut costs and improve productivity in the workplace by giving them the ability to register their entire domain names. Very important to businesses.

Some have expressed concern about creating a list of e-mail addresses that spammers could exploit. The FTC has already said it is technologically possible to create and secure the list. This is no longer a worry and one of the breakthroughs we made in the last few months that are allowing this legislation to come to the Senate floor.

In fact, we know that the database of addresses can be protected by military-caliber encryption so that its valuable contents will not fall into the wrong hands.

I want to take a few minutes to talk about the underlying bill and other amendments, and then I will get into mine.

First, I commend Senators Burns and Wyden for their long efforts on this bill. The bill will, for the first time, set minimum standards for all commercial e-mail. It will require all commercial mail to include valid return e-mail addresses and physical addresses of the sender. It must provide accurate header and router information. And most messages will be required to have an opt-out system.

It does not stop there. In addition to these provisions, it will take aim at the mass collection of e-mail addresses and the rampant fraud which, according to a report released by the FTC, is present in 66 percent of junk e-mail.

I am hopeful that we can add important criminal provisions to these civil measures. I know both my colleagues, including Senators McCain and Hollings, want to do that. I worked in the Judiciary Committee with Senators Hatch and Leahy on a bill that makes it clear that fraud and deception in e-mail will not be tolerated. And those who do not heed the warnings in this bill will face stiff punishment. These criminal provisions will outlaw some of the spammers' favorite tricks.

About our legislation as well, let me just say it is really important that we put in the registry, which, in my judgment, is the best way to get at spam. No system is foolproof and, as Mr. Morris of the FTC has said, no bill will solve all of the problems. But the registry is the most complete, comprehensive way to do it, combined with the criminal penalties that we are adding in the Hatch-Leahy-Schumer amendment.

The minute somebody spams someone on the Do Not Call list, there will be an immediate cause of action and criminal prosecution.

The good news is that since we know that a large amount of spam comes from a small amount of people, we can get after these few people. This legislation, as you know, gives the FTC 6 months to come back with a comprehensive proposal. We then get 3 months here to examine it to see if we want to change it, and then the FTC may implement it. I have received--and they have both verbalized this on the Senate floor-- assurances from Senators McCain and Hollings that if the FTC should decide they don't want to implement it, or come up with something that is unworkable, they will use their clout with the FTC to straighten things out and get this done. Otherwise, we in the Congress can respond.

I believe this amendment will allow, without any further action by Congress, as long as the House passes it and it stays in the bill--and I thank Senator McCain for assuring me that he will not even sign a conference report that doesn't have this amendment in it, and I know all of my colleagues are for this legislation. But once it passes the House and is signed into law, we set the road for a no-call registry. It is all downhill after that.

Within a year, it is my belief we will have that registry and, just as the no-call registry was a great success, I believe the no-spam registry will be a great success. It will take a little longer, it will be a little more difficult, but the same basic popularity and support that the American people have given the no-call registry, they will give, for sure, to the no-spam registry, and the combination of a good proposal that the FTC will have to send to us in 6 months and vigilant enforcement, plus the no-spam registry, plus the underlying base of the bill, will put a crimp, a real dent in spam.

Are we ever going to eliminate all spam? For sure not. But is this legislation, along with the amendment I am adding, going to be the toughest, best approach, and greatly curtail spam? Indeed. It is my belief that when we enter these portals a year from now, spam will have greatly decreased.

One of the great inventions of the 20th century, which is now sick and ailing, will be healthy and going full steam ahead. The bottom line is that this is a very fine day for those who use computers and e-mail and for American technology in general. It shows that we can all work together and get something done--get something done that the American people want.

I ask my colleagues to support this amendment and the underlying legislation. Let's finally do something about one of the greatest technological problems that we face right now in this country, the proliferation of spam.

With that, I yield the floor.

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

Madam President, I ask unanimous consent that we adopt the amendment and add it to the legislation.

Will my colleague yield?

I once again thank my colleague from Arizona for helping us with this list and his commitment in terms of keeping this in the conference and then making sure the FTC moves forward with this in every technological way possible. I very much appreciate it. As I mentioned before, the Senator is a true gentleman, a man of his word. We would not be here today without his good work.

I think the Senator from Arizona has the floor.

Mr. President, I rise today to address an issue of importance to all Americans, the quality and safety of health care in the United States.

Numerous studies have identified serious shortcomings in the quality and safety of health care. However, addressing these shortcomings and improving health care outcomes in a complex health care system requires long-range strategies and specific goals.

The Medicare program, as one of the largest purchasers of health care, is ideally situated to take a leadership role in encouraging quality improvement. Currently, however, Medicare's payment methods and regulations provide few incentives to pursue innovative quality improvement strategies and to reward those who achieve exemplary performance.

Traditional Medicare pays most physicians according to a fee schedule and pays hospitals according to a DRG-based payment system. Medicare+Choice plans are paid a capitated rate and, in turn, pay physicians using a range of approaches, from salary to capitation to fee-for-service, none of which directly reward enhanced quality.

Attempts to adjust Medicare payments to reward performance improvements in safety and quality have been hampered, in part, by the lack of measures and data for assessing performance. Although the Centers for Medicare and Medicaid Services recently began an initiative to develop voluntary consensus performance measures for 10 clinical conditions for hospitals, standardized measures of quality for hospitals and providers do not otherwise exist.

As the Senate considers a new Medicare prescription drug benefit and additional measures to reform the Medicare program, it is more important than ever that we consider also measures to ensure that these new benefits are provided as safely and effectively as possible.

That is why I am today introducing a bill charging the Institute of Medicine with performing a study to evaluate leading health care performance measures and options to implement policies that align performance with payment in Medicare.

We have learned much about health care quality in the last several years. The Institute of Medicine, in its studies entitled ``To Err Is Human,'' and ``Crossing the Quality Chasm,'' has identified the health care safety and quality shortcomings that exist and the need for improvement. In a recent study performed at the request of Congress, ``Leadership by Example,'' the Institute of Medicine identified the leadership role that Government can take in improving health care quality in government sponsored health care programs and those in the private sector.

The bill that I am introducing today, and the study that will result, represents the next step toward improving health care quality and safety in the United States. It is an important step and one that we must take in order to ensure that Medicare beneficiaries receive the highest quality health care services available. I urge my colleagues to join me in supporting this legislation.

Mr. President, there is no question that our need to improve the Medicare program by adding prescription drug coverage for beneficiaries is extremely important, as this debate indicates.

But, our discussions would not be complete if we neglected another major Medicare improvement which is also long overdue, and that is the need to improve the climate in which providers strive to provide high quality services to patients.

Medicare's anticipated regulations--three times longer than the U.S. tax code--prevent providers from delivering health care efficiently and beneficiaries from receiving the care they need.

Complex Federal regulations and reams of paperwork require physicians to spend hours each day filling out government forms rather than caring for their patients. The array of Federal Medicare rules with which physicians must comply is overwhelming. Doctors are required to complete claims forms, advance beneficiary notices, certify medical necessity, file enrollment forms, and comply with code documentation guidelines. Indeed, these rules and mandates are not only extensive, they are constantly changing and they may be interpreted differently in different regions of the country.

The complexity of the rules and the variation in their interpretation has prompted outcries from all centers of our country. In fact, I have heard loud and clear from the physicians in my home State of Utah about the severity of the problem.

Leon Sorensen, Executive Vice President of the Utah Medical Association, recently wrote to me and said:

``The Utah Medical Association has long been concerned

about the unnecessary burdens placed upon physicians by the

voluminous regulations of Medicare. Not only does compliance

with these regulations take physicians' time away from

patients, but also the regulations contribute to the high

cost of medical care while contributing little of value. They

discourage physicians from participating fully in Medicare.

They are often punitive in nature rather than an educational.

They use tactics that would not be tolerated by businesses or

government if applied to them.

An example is the practice of extrapolating a small sample

of billing errors over the physician's entire practice,

making the physician liable for payback of thousands of

dollars of ``overpaid'' claims when demonstrated over

billings may amount only to a few dollars. If this process

were used by the IRS in a tax audit, the public outcry would

be deafening.

Medicare also requires that alleged ``overpayments'' to

physicians by repaid within 60 days, even if a physician

chooses to appeal Medicare's allegations. When assessed a

Medicare overpayment, the only way physicians can appeal is

to subject their practices to another audit, using a

``statistically valid random sample.'' Statistical sample

audits can shut down a physician's practice for days,

preventing physicians from treating patients. Physicians are

forced to settle with Medicare rather than be subjected to

such unfair scrutiny.

Any defense against this kind of administrative abuse is

extremely costly, time consuming and often ineffective.

Indeed, failure to follow Medicare's complex rules--or just the perception of such failure--can result in an audit of a physician's billing records, withholding of payments and crippling of a physician's practice.

And, physicians are not the only individuals affected by these rules. Medicare beneficiaries are affected--both directly and indirectly--by Medicare's onerous rules and burdensome paperwork. Both patients and providers are confused by obscure paperwork and apparently conflicting rules. Physicians have difficulty understanding how to bill for their services and beneficiaries find it difficult to understand the forms and billing information that they receive. Indeed, the administrative costs associated with managing this paperwork and the fear of harsh consequences in response to clerical errors has led some providers to consider whether they should continue to participate in the Medicare program.

The problem has not escaped the attention of the administration and addressing it is a priority for President Bush and it should be for Congress also. Secretary Thompson has said, ``Patients and providers alike are fed up with voluminous and complex paperwork. Rules are constantly changing. Complexity is overloading the system, criminalizing honest mistakes and driving doctors, nurses, and other health care professionals out of the program.''

Congress has considered legislation over the past few years to provide relief from this regulatory burden. Former Senator Frank Murkowski should be given great credit for drafting S. 452, the ``Medicare Education and Regulatory Fairness Act of 2001''--legislation that he introduced in the Senate on March 5, 2001 but which never came to a vote.

The legislation that I am introducing today, the ``Medicare Education Regulatory Reform and Contracting Improvement Act of 2003,'' MERCI, builds on that initiative. It will improve the Medicare program for beneficiaries and providers alike by clarifying regulations, rewarding quality and by enhancing services. I am introducing this legislation today because the need for Medicare regulatory reform remains. In fact, the need for Medicare regulatory reform has never been greater. In addition, the regulatory reform that I am proposing in MERCI fits hand in glove with the reforms that we have

proposed in S. 1, the ``Prescription Drug and Medicare Improvement Act of 2003.'' The reformed Medicare program must include reformed regulations if it is to provide efficient service to beneficiaries.

Let me take a moment to review a few of the important provisions in this bill. The educational provisions of the MERCI Act are designed to decrease Medicare billing and claims payment errors by improving education and training programs for Medicare providers. It includes also provisions that will improve communication between the Department of Health and Human Services and Medicare providers. Furthermore, the bill will improve communication with Medicare beneficiaries by providing for central toll-free telephone services to require free, appropriate referrals to individuals seeking information or assistance with Medicare.

The MERCI Act includes regulatory reform provisions that are designed to reduce waste, fraud and abuse in Medicare; provisions that are just and fair for beneficiaries, contractors, and providers. Among other things, the bill eliminates retroactive application of regulatory changes and expedites the appeals processes for beneficiaries, providers, and suppliers of Medicare services.

Finally, the MERCI Act will improve Medicare contracting; increasing competition, improving service and reducing costs by providing for a competitive bidding process for Medicare contractors that takes into account performance quality, price and other factors that are important to beneficiaries.

Medicare beneficiaries and Medicare providers have been suffering from burdensome and confusing regulations for too long. It is time that they received some mercy. The time for Medicare regulatory reform has come and the bill that I am introducing today provides that mercy. MERCI, the ``Medicare Education, Regulatory Reform and Contracting Improvement Act of 2003'' takes a common sense approach to providing relief for the Medicare beneficiaries and providers who have been suffering this burden for so long.

I believe that MERCI will improve the delivery of health care services to Medicare beneficiaries by enhancing the efficiency of the Medicare program for all concerned.

Finally, I would be remiss if I did not thank Chairman Grassley and Senator Baucus for working with me to include the MERCI legislative language in S. 1, the ``Prescription Drug and Medicare Improvement Act of 2003.'' Senators Grassley and Baucus have worked for many years to reform Medicare's complex regulations, as have I, and their agreement to include this language is appreciated greatly.

And so, it is with a great appreciation for my colleagues who have worked with me on this legislation and for those who have worked on similar legislation in the past, that I urge my colleagues in the Senate today to join me in addressing the needs of Medicare beneficiaries and providers by supporting this legislation.