SEC Civil Enforcement Act

Mr. President, I rise today to discuss the CARE Act and my concerns regarding the implementation of President Bush's faith- based initiative.

Like many of my colleagues, I am a person of faith. I support the good work that religious organizations undertake every day. I agree with President Bush and the sponsors of this legislation that there is an important role for the Federal Government to play in encouraging religious organizations to do more for the good of society.

In fact, I support many of the provisions of the CARE Act before us today. For example, I have been an original cosponsor of the Charitable IRA Rollover Act and a cosponsor of the Good Samaritan Hunger Relief Tax Incentive Act in the last two Congresses. I also

support the increased funding for the Social Services block grant.

However, when I read the specific details of how the President is implementing his faith-based initiative, I am concerned that the good intentions behind this proposal may be lead to troubling, unintended consequences.

It appears that what the President wants to achieve with this initiative is to fundamentally change the historic balance in the relationship between government and religion that our founding fathers struck over 200 years ago.

I believe and many of my colleagues agree: this Senate debate is historic. With our deliberations, we will test Constitutional principles regarding the place of religion in America in a way they have never been tested.

That is why many Senators joined me in insisting that the Senate take all deliberate time and attention to carefully review this bill and to add language to clarify and improve the bill.

Since the Senator from Pennsylvania has agreed not to add language that would raise concerns with respect to church and state, I have joined with Senator Jack Reed of Rhode Island in agreeing not to offer our amendments at this time. However, I would like to take this opportunity to express my concerns regarding the President's implementation of his faith-based initiative which, if offered at a later time, I hope will be subject to a vigorous, important, and historic debate in the Senate.

We should begin this debate at the beginning. The opening words of our Bill of Rights state that:

Congress shall make no law respecting an establishment of

religion, or prohibiting the free exercise thereof.

For over two centuries, those 16 words have served us well and have protected religious freedom in America.

We must continue to respect the diversity of belief in America and remember that freedom from government interference was one of the few principles that early Americans, with a variety of religious backgrounds, could agree on.

In fact, many of the settlers who colonized America fled from religious persecution by government officials in their native countries and they still do.

James Madison recognized that this history of religious persecution was based upon Government involvement in establishing official churches. He believed that Government support of certain religions could threaten the liberty of every citizen to hold his or her own religious convictions.

Madison suggested that the Government support of religion differs only in a matter of degree, and he vehemently opposed the payment of taxes in support of any religion.

Before the American Revolution, the State of Virginia rescinded a tax in support of the Anglican Church, which was their so-called established church, and instead granted its citizens religious liberty. However, in 1784, Patrick Henry became concerned with the moral decline of Virginians and he proposed a bill to restore the tax to support ``teachers of the Christian religion.''

Madison responded to this proposal with his ``Memorial and Remonstrance against Religious Assessments.'' This document--written 16 years before the Bill of Rights was adopted--reveals the earliest origins of the concepts behind the first amendment: Madison expressed his opposition to Government involvement in religion because he believed such involvement would interfere with citizens' right of free exercise. Madison also believed that the right of religious freedom was as important as freedom of the press, trial by jury, and the right to vote.

According to Madison, his Memorial was so widely accepted that Henry's proposal failed and Virginia instead enacted Thomas Jefferson's ``Bill for Establishing Religious Freedom in Virginia.''

In this bill, Jefferson expressed his belief that religious liberty is necessary to ensure that individuals are not forced to support religious opinions with which they disagree, to practice faiths they find abhorrent, or to voice allegiance to one faith over another, and:

To compel a man to furnish contributions of money for the

propagation of opinions which he disbelieves and abhors is

sinful.

During their Presidencies, Jefferson and Madison had the opportunity to illustrate their understanding of the first amendment to the Constitution.

In 1801, the Danbury Baptist Association wrote a letter to President Jefferson because it feared that the State of Connecticut would establish the Congregationalist Church as the official religion.

Jefferson responded to the Danbury Baptist Association with a letter on January 1, 1802, in which he reaffirmed his belief that each individual has the right to hold whatever opinion he or she may choose and that the Government should not interfere in religion. This reply contained his now-famous view that the purpose of the first amendment was to build a--in Jefferson's words--``wall of separation between church and state.''

President Madison, in his 8 years in office, vetoed only seven bills--two of which he believed violated the Establishment Clause of the first amendment.

In 1811, Congress passed a bill entitled ``An act incorporating the Protestant Episcopal Church in the town of Alexandria in the District of Columbia.'' This bill would have enacted the rules of the church as a matter of law, thereby giving legal force to the provisions of the church's constitution.

Madison believed that even supporting churches in their charitable functions would give religious organizations too much power in public and civic affairs. He wrote that the bill would be ``precedent for giving to religious societies as such a legal agency in carrying into effect a public and civic duty.'' Think of those words in the context of the proposal before us.

Madison also vetoed a bill ``An act for the relief of Richard Tervin, William Coleman, Edwin Lewis, Samuel Mims, Joseph Wilson, and the Baptist Church at Salem Meeting House, in the Mississippi Territory.'' This bill would have given a Baptist Church specific Federal Government property for the church's use.

Madison believed that:

reserving a certain parcel of land of the United States for

the use of said Baptist Church comprises a principle and

precedent for the appropriation of funds of the United States

for the use and support of religious societies, contrary to

the article of the Constitution which declares that

``Congress shall make no law respecting a religious

establishment.''

Thanks to Jefferson and Madison, first amendment protections have made America the most tolerant society in the world--a tolerance many of our critics around the world neither understand nor accept. They live in nations where government and religious belief are so closely entwined that diversity of creed is officially discouraged, if not prohibited.

Each of us, when we return home, can drive through our cities and see a Protestant church down the street from a Catholic church, next to a Jewish synagogue which is not too far from a Muslim mosque, and perhaps across the street from a Sikh Gur-dwala. Some churches even share their facilities with congregations from other religious and ethnic groups. To me, this is proof positive that the wisdom of the first amendment is alive and well in America today.

Although some may argue that the faith-based initiative does not ``establish a religion,'' the Supreme Court has ``long held that the First Amendment reaches more than classic, 18th century establishments.''

Indeed, the Supreme Court has examined the history of the first amendment and has come to the same conclusion that I have reached:

For the men who wrote the Religion Clauses of the First

Amendment the `establishment' of a religion connoted

sponsorship, financial support, and active involvement of the

sovereign in religious activity.

That comes from the case of Walz v. Tax Commission in 1970.

This is one principle that President Bush seems to be willing to accept. I am heartened that the White House publication Guidance to Faith-Based and Community Organizations on Partnering with the Federal Government is clear that faith-based organizations cannot use any part of a direct Federal grant to fund religious worship, instruction, or proselytization. Such activities must be separate in time or location.

The President also agrees that faith-based organizations cannot discriminate against beneficiaries or potential beneficiaries of a social service on the basis of religion.

However, one area where we clearly diverge is the issue of employment discrimination on the basis of religion.

The Civil Rights Act of 1964 prohibits most public and private employers with 15 or more employees from discriminating in their employment practices on the basis of race, color, national origin, sex, and religion.

However, religious employers have an exemption with respect to religious discrimination, which was expanded in 1972.

I will read the current exemption:

This subchapter shall not apply . . . to a religious

corporation, association, educational institution, or society

with respect to the employment of individuals of a particular

religion to perform work connected with the carrying on by

such corporation, association, educational institution, or

society of its activities.

In 1987, the Supreme Court upheld this title VII religious exemption in the case of Corporation of Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints v. Amos.

I support this right of religious organizations to use religious criteria in hiring people to carry out their religious work. I have no quarrel with the title VII religious exemption. It makes sense for people of common faith to work together to further their religion's mission.

At the same time, I recognize that discrimination ``on the basis of religion'' can often include discrimination based on other factors that are prohibited by civil rights laws, such as race, ethnicity, and sex.

Dr. Martin Luther King, Jr., observed that the hour of worship is one of the most segregated hours in American society. Sadly this is still true today, but many people of similar racial or ethnic backgrounds do prefer to worship together, and there are churches throughout this Nation that target only certain races or ethnic groups.

So, unfortunately, allowing religious organizations to hire only members of their own religion, in many cases, can also mean hiring only members of a certain race or ethnic background.

For example, if employment is limited to the co-religionists of the recipients, how many African Americans will be hired by Orthodox Jewish groups? How many white people will the Nation of Islam employ as security guards in public housing? And what of the many Protestant groups that are overwhelmingly White or overwhelmingly Black or overwhelmingly Hispanic?

The courts also have read the title VII exemption very broadly to allow discrimination on the basis of religion to include the religion's ``tenets and teachings.'' This broad reading has resulted in situations where people of faith who do not necessarily follow the accepted lifestyle or private behavior of that religion have lost their jobs.

Here are some examples of how this law discriminates against people's everyday behavior in addition to their religious beliefs:

In the case of EEOC v. Presbyterian Ministries, Inc., a Christian retirement home fired a Muslim receptionist after she insisted on wearing a head covering as required by her faith.

The Church of Jesus Christ of Latter-Day Saints fired several employees because they failed to qualify for a ``temple recommend,'' that is, a certificate that they were Mormons who abided by the church's standards in such matters as regular church attendance, tithing, and abstinence from coffee, tea, alcohol, and tobacco.

This exemption, unfortunately, has had a particularly harsh impact on women and people of different sexual orientation. Here are some examples of how courts have interpreted this exemption to allow employment discrimination against women and gays under the current title VII exemption:

Numerous Christian schools fired female teachers for having extramarital sex or committing adultery; upheld by the court. A Catholic school fired a teacher who remarried without seeking an annulment of her first marriage in accord with Catholic doctrine; upheld by the court. A Catholic school fired a teacher for marrying a divorced man; upheld by the court. A Catholic university refused to hire a female professor because her views on abortion were not in accord with Catholic teaching; upheld by the court. A Baptist nursing home fired a student services specialist after she was ordained a minister in a gay and lesbian church that advocated views on homosexuality ``which were inconsistent with the [school's] perception of its purpose and mission''; upheld by the court. A church terminated the employment of an organist on the grounds that his homosexuality conflicted with the church's belief; upheld by the court.

I regret that these may be unintended discriminatory consequences today under the title VII exemption where religious organizations hire people using money raised by the church from its own congregation. But what of the case we are discussing? We are not talking about a situation where churches are spending their own money for their own religious purposes and following their own employment codes and practices under the title VII exemption. We are talking about opening up a new world where tax dollars are taken from the treasury and given to these same churches. What if the money is not raised by the congregation or coreligionists, but the money is being raised from the taxpaying public? What standard should we use?

Most scholars agree it is an open legal question as to whether a religious organization can take taxpayer money and use it to discriminate in hiring employees on the basis of religion. It would seem to me that the obvious answer to this question is no. Any other response would result in taxpayer-funded discrimination. I will return to this question and the reasons for my answer after examining asking how this issue fits into the broader picture of the President's faith- based initiative.

The faith-based initiative has been marketed as a proposal to ``level the playing field'' for religious organizations that seek government funds to pay for social service programs. However, it appears that the supporters of the initiative do not want to level the playing field; they want to create a special set of rules for religious organizations which would result in special treatment that other nongovernmental organizations do not currently enjoy.

President Bush has demonstrated, through his Executive orders and agency regulations, that his faith-based initiative goes far beyond religious icons, religious names, religious language in chartering documents or religious criteria for membership on governing boards. I do not object to any of those stated goals which I have heard from the Senator from Pennsylvania and the Senator from Connecticut as well as the President. I have seen the enforcement of rules and standards which I think have gone way too far.

I can think of my own hometown of Springfield where there is a long- simmering controversy still brought up regularly about whether a teacher could come in and teach a driver training course at the Catholic high school if that teacher were paid for out of public school funds and that Catholic high school and its classroom had a crucifix on the wall. It rubbed a lot of people of my Catholic religion the wrong way, that people would argue that the mere presence of that crucifix was somehow offensive or violated the law. That argument goes to the extreme. I do not hold those views. I support the position stated time and again by the Senators from Pennsylvania and Connecticut that we ought to draw a more reasonable line. The House of Representatives, with mottos on the walls ``In God We Trust,'' with our currency reflecting that, with chaplains in the House and Senate, we can state a reasonable standard that does not violate the basic freedom of religion or establishment clause of our Constitution. But I do object to the administration bypassing Congress to write one set of rules for secular organizations and another for religious organizations.

For example, all recipients of government grants currently are required to abide by a host of regulatory requirements, including filing IRS documentation and complying with all State and local laws. Supporters of the faith-based initiative would like to exempt religious organizations from complying with these important regulations, such as those dealing with health and safety. Explain that for a moment.

If in the State of Illinois or my city of Springfield someone wants to run a daycare center and we have decided, for the safety of the children in the

daycare center, there should be perhaps a sprinkler system, a fire alarm, or a fire escape, certain doors so that kids can get out in case of emergency, why, if this becomes a faith-based childcare center, should we reduce or limit that same application of health and safety standards? It doesn't make sense. One of the amendments which needs to be offered as part of this conversation on faith-based initiatives will address that.

Take a look at the Teen Challenge substance abuse program which President Bush has mentioned many times. In 1995, the Texas Commission on Alcohol and Drug Abuse threatened to close Teen Challenge after issuing a 49-page list of violations of State health and safety codes. The list included unlicensed counselors, food preparation that created a health hazard, a broken smoke detector system, and exposed wires and electrical outlets. Then-Governor Bush responded by exempting faith- based drug treatment programs from all of the State health and safety regulations that were followed by their secular counterparts.

I don't know how you could reach that conclusion. It is one thing to be imbued with a religion; it is another thing to ignore the obvious. If there is a terrible accident or fire or some disaster, children in faith-based institutions deserve the same level of legal protection as those in institutions run as businesses.

This special treatment was not limited to drug treatment programs. Faith-based childcare centers and residential children's homes could use an alternative accreditation program that would exempt them from State licensing. The special treatment for these alternatively accredited facilities was that there were no unannounced inspections of the facilities as required by State law. As a result, the rate of confirmed abuse and neglect at alternatively accredited facilities was 25 times higher than that of State-licensed facilities. Whom are we doing a favor for by exempting the faith-based charity from standards of unannounced inspections to make certain that they are living up to the letter of the law?

The complaint rate at alternatively accredited facilities was 75 percent compared to 5.4 percent at State-licensed facilities. Due to these staggering outcomes, this accreditation program sunset in 2001 and has never been renewed.

The White House has also given indications it may provide special treatment to religious organizations by exempting them from State and local laws addressing employment discrimination. I have a great deal of respect for the Salvation Army. They do wonderful work, not only in the United States but around the world. But they had a rather embarrassing incident in July of 2001 when an internal report was discovered that stated their group had received a ``firm commitment'' from the Bush White House to protect religious charities from State and local laws regarding sexual orientation discrimination and domestic partner benefits. I hope that is not the goal of the Bush White House in pushing this faith-based initiative.

Over the past 2 years, President Bush and his faith-based initiative have repeatedly eroded 200 years of carefully protected separation between church and state. In what the Washington Post called ``faith- based by fiat,'' President Bush signed Executive Order 13279, in December of 2002, to overturn principles of nondiscrimination in Federal contracts that have stood for over 60 years.

The House of Representatives is currently considering the reauthorization of the Workforce Investment Act. The legislation has been marked up in the House, and it would repeal 20 years of civil rights protections against religious discrimination. The House also has held hearings regarding the reauthorization of the Corporation for National and Community Service, known as AmeriCorps. In its proposed legislation, the House would repeal a decade of civil rights protections against religious discrimination in employment that were signed into law by President Bush's father.

Finally, the Department of Housing and Urban Development has proposed rules to allow religious organizations to use Federal funds to build centers where religious worship is held as long as parts of the building are also used for social services.

Supporters of the faith-based initiative want to know why we are raising these issues now, when Congress included charitable choice provisions in legislation we passed as far back as 1996. The difference is this: Then-President Clinton made it clear, as part of the technical corrections package to the welfare reform bill, that nothing included therein would change the fundamental protections against religious discrimination which were currently in the law. President Clinton did that as well in the reauthorization of Community Services Block Grant Programs in 1998 and the reauthorization of the Substance Abuse Mental Health Services Act in 2000. Unfortunately, in this debate, that same assurance has not been given.

I want to go to a point which really gets to the heart of the issue. It is a difficult one. It is one for which I don't have an answer. When you talk about faith-based initiatives, you are talking about religion in America. The obvious and important question is: What is a religion? There are many that we readily will recognize as being established religions of all different denominations. But when it comes to the definition of religion, many people self-define their beliefs and activities as religion.

Jim Jones led people to a mass suicide in Guyana, and David Koresh and his Branch Davidians in Waco, TX, have become scarred in the American memory as tragic reminders of what happens when people are blindly led by fanatics who use the guise of religion for their own personal, violent agenda. I represent a State which is the home of the so-called World Church of the Creator, which has to be one of the most perverted extremist groups in America that I know of, which claims itself to be a religion. On its Web site, the so-called ``Reverend'' Matt Hale--who graduated from law school but was not allowed to be licensed under the rules and practices of the bar in Illinois--proudly welcomes visitors, saying:

We are a religious, nonprofit organization, with our world

headquarters in the State of Illinois. At the time of this

writing, we have 24 regional and local branches of the church

and members all over the world.

What are the tenets of his church and religion, of this World Church of the Creator? Here is what he says in his own words:

After 6,000 years of recorded history, our people finally

have a religion of, for, and by them. Creativity is that

religion. It is established for the survival, expansion, and

advancement of our white race exclusively. Indeed, we believe

that what is good for the white race is the highest virtue,

and what is bad for the white race is the ultimate sin.

I cannot think of any more hateful rhetoric spewed in the name of religion. That is exactly what is happening today. Recently someone challenged their dismissal of employment because they were members of this church. The court came back and said it is a religion and has to be treated as such for the purpose of the Civil Rights Act of 1964.

So here we come to a point where we are talking about giving Federal dollars to those who call themselves religions for the purpose of performing social services. What is the threshold question we should ask? Is this truly a religion or is this something else in the guise of a religion? What are we doing with taxpayer dollars? Would we want to spend $1 supporting the racist views of the World Church of the Creator because they tell the Federal Government they have a program to deal with drug abuse or to provide childcare services in central Illinois? I hope not. But once you have opened this door and start talking about Federal dollars given to religion for social services, you open up a can of worms, a set of questions and great challenges that we have not faced for many years, if ever.

I am worried as I look across the various religions of the world, not just those purporting to be Christian but some who are members of different religions that have taken what in fact are extreme views.

It was only a little more that a year ago that the people of Afghanistan were still suffering under the violent and oppressive regime of the Taliban, which suppressed and punished its people in the name of Islamic fundamentalist religious beliefs.

Thanks to the leadership of the United States and our military, we

have now liberated the Afghan people from the Taliban, which, like Al Qaeda, had distorted the peaceful religion of Islam for their own destructive purposes.

The leaders of the Taliban were trained in ``madrassas,'' which are characterized as religious schools. But those familiar with these institutions often call many of them ``jihad factories'' because of the extreme nature of their ``religious'' indoctrination and the militancy they train.

At madrassas, the Taliban preached that freedom afforded to women is the main reason for social degradation, and that the best place for women was inside the four walls of their homes--cut off from education and cut off from opportunity.

They also preached that television is the ``spark of hell'' responsible for moral degradation, and watching it or listening to music was un-Islamic and sinful. And when they came to power, the Taliban put all of these distorted lessons to practice against their own people.

The Taliban is perhaps the most recent example of extremism in the name of religion that we have witnessed.

But since the 1979 Islamic revolution in Iran, we have seen numerous radical Islamic fundamentalists utilize their religious ideology as the driving force behind the most active Middle Eastern terrorist groups and state sponsors.

For example, Hizballah of Lebanon calls itself the ``Party of God'' although there is nothing godly about its terrorist activities.

Hizballah was founded in 1982 as a faith-based organization by Lebanese Shiite clerics who were inspired by the Islamic ideology of Iran's Ayatollah Khomeini. Its original goal was to establish an Islamic republic in Lebanon. But many of the Shiite Muslims who rule Hizballah studied in Iran's theological seminaries while receiving terrorist training there as well.

The trainings paid off as this terrorist group became responsible for the detention of most, if not all, American and other Western hostages held in Lebanon during the 1980s and early 1990s. Eighteen Americans were held hostage during that period, three of whom were killed.

Hizballah is also suspected in the April 1983 suicide truck bombings of the U.S. Embassy in Beirut and the U.S. Marine barracks in October 1983 that killed 220 Marine, 18 Navy and 3 Army personnel.

And Hizballah is also suspected to have been behind the hijacking of TWA Flight 847 in 1985, and the killing of a Navy diver, Robert Stethem, who was on board.

Hamas, Al-Jihad, Abu Sayyaf, and Islamic Movement are some of the other better-known extremists that argue their organizations are based on Islamic religious beliefs.

There are radical Jewish groups as well, such as Kach and Kahane Chai. These two Jewish movements seek to expel all Arabs from Israel and expand Israel's boundaries to include the occupied territories and parts of Jordan. Founded by extremist Rabbi Meir Kahane, these groups also argue for strict implementation of Jewish law in Israel.

I do not mean to suggest here that the President's faith-based initiative will necessarily lead to such religious extremism.

At the same time, I want to make it clear that this is not an easy question. To dismiss it simply as a question about whether or not we are tolerant of religion is one thing, but the question of whether we are going to subsidize religious belief that reaches the extreme is really something else.

The important message we must send is that religious organizations that take taxpayers' money should not be able to use those funds to discriminate in hiring employees on the basis of religion. The American people have been asked their opinion on this issue. The response is interesting.

According to the Washington Post, in a 2001 survey conducted by the Pew Research Center:

When people were asked whether ``religious groups that use

Government funds [should] be allowed to hire only those who

share their religious beliefs,'' 78 percent said ``no'' and

18 percent said ``yes''--a degree of objection that so

surprised researchers that they repeated the question three

different ways. . . .

They received the same answer time and time again. On the other hand, the Bush administration believes that Government-funded discrimination in hiring on the basis of religion is acceptable.

According to a U.S. Department of Justice Office of Legal Counsel memorandum on June 25, 2001:

We conclude, for the reasons set forth more fully below,

that a faith-based organization receiving direct Federal aid

may make employment decisions on the basis of religion

without running afoul of the Establishment Clause.

In the only case that directly addressed whether the Title VII exemption applies to a position funded by government funds, the Southern District Court of Mississippi ruled that it did not.

In the 1989 case Dodge v. Salvation Army, Jamie Dodge was employed by the Salvation Army in its Domestic Violence Shelter as the Victims Assistance Coordinator.

After the Director of the shelter saw Ms. Dodge using the Salvation Army's copy machine, Ms. Dodge admitted that she had made copies of manuals and information on Wiccan rituals.

Soon after making these admissions, Ms. Dodge was terminated.

She filed a complaint that because the shelter where she worked received substantial federal and state funds, the Title VII exemption could not be applied to her.

The District Court ruled that ``even though the religious exemption does permit the Salvation Army to terminate an employee based on religious grounds, the fact that the plaintiff's position as Victims' Assistance Coordinator was funded substantially, if not entirely, by federal, state, and local government, gives rise to constitutional considerations which effectively prohibit the application of the exemption to the facts in this case.''

Furthermore, the Court held that ``Based on the facts in the present case, the effect of the government substantially, if not exclusively, funding a position such as the Victims' Assistance Coordinator and then allowing the Salvation Army to choose the person to fill or maintain the position based on religious preference clearly has the effect of advancing religion and is unconstitutional.

Despite this ruling, the issue is considered an open legal question because the case was not considered beyond the District Court and there are several other cases which at least partially address this question.

However, this is not just a legal question or a hypothetical line we are drawing in the sand.

One of the cases I would like to point out is a case that really talks about discrimination firsthand. It is the case of Alan Yorker and his experience with United Methodist Children's Home in Decatur, GA. The children's home, which receives almost half of its money from Government sources, provides residential group foster care for 70 young people, many of whom are in State custody.

Mr. Yorker responded to an advertisement in the Atlanta Journal- Constitution for a position at the home. As a psychotherapist with over 20 years experience counseling young people and their families and over a decade of experience teaching in Emory University professional schools, the home determined that his credentials placed him among the top candidates for the position. He was rushed in for an interview, where he was required to disclose in an application form his religious affiliation, his church and minister. Mr. Yorker, a Jew, supplied the names of his synagogue and rabbi. During the interview, an administrator noted that Mr. Yorker was Jewish and told him that this children's home doesn't hire people who are Jewish. He was shown the door.

Let me tell you that this didn't happen decades ago; this is of recent vintage. The same administrator told another employee that it is the home's practice to throw the resumes of applicants with Jewish- sounding names in the trash. The Yorker name got past her.

Ironically, Yorker has not always been the family name. Alan Yorker's Jewish paternal grandfather, Harry Monjesky, spent many years as a conductor on the New York Central Railroad. When the railroad began to face tough times, Jewish and African-American workers were singled out for layoffs first, regardless of their seniority.

Mr. Monjesky was fired and left without a livelihood. Several years later, when Alan's father reached adulthood, he changed his name to Yorker. He wanted to make sure that his children would be judged by their merit and not by their surname or private religious beliefs.

That is how Alan Yorker's resume landed at the top of the pile instead of the home's trash bin. And nearly a century after his grandfather was turned away by the Railroad because of his religion, Alan Yorker faced the same discrimination when applying for a government-funded position.

I will conclude by saying that these are examples of what is being done in the name of religion. For it to be done by a religious organization to achieve a religious goal, with funds raised by co- religionists, is certainly allowed in title VII of the Civil Rights Act. To say, however, that we are going to open the Federal Treasury and provide millions of dollars to religions for social services, and then approve of their discriminatory activity in the name of religion, is branching out in a direction that our Founding Fathers could never have considered, let alone condoned.

In light of this complex constitutional issue, I think it is fair to ask why we even need a faith-based initiative. President Bush believes it is necessary because ``people should be allowed to access money without having to lose their mission or change their mission.'' However, current law already permits groups that are affiliated with religious entities to provide social services with Government funding.

Catholic Charities, Lutheran Social Services, Jewish Federations, and many other religious organizations have received--and continue to receive--taxpayer funds from the Government to provide much-needed services that our Government is often unable and unavailable to provide.

These organizations access Federal funds without changing their missions. For example, Catholic Charities has a publication entitled ``10 Ways Catholic Charities are Catholic.'' At the same time, Catholic Charities in Chicago, which I am proud to represent, also issues the following statement on its Web site:

Catholic Charities employs more than 3,000 dedicated,

compassionate and professional men and women, regardless of

race, religion, or ethnic background.

Many Catholic Charities across the Nation have similar equal opportunity statements.

As thousands of Americans visit our Nation's Capital, many will stop at the Jefferson Memorial and read the following inscription, in the words of Thomas Jefferson:

No man shall be compelled to frequent or support any

religious worship ministry or shall otherwise suffer on

account of his opinions in matters of religion.

These words, from Jefferson's ``Bill for Establishing Religious Freedom in Virginia,'' are as relevant now as they were in 1785. Although we don't debate the faith-based initiative proposal in its entirety today, I look forward to the opportunity to continue to protect our historic balance in the relationship between church and state.

I yield the floor.

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

Mr. President, I thank the Senator from Iowa, the chairman of the Finance Committee, for his kind words and his cooperation. I thank the ranking member of the committee for his cooperation.

There are some things in this legislation that he is not particularly enamored with, but he was most cooperative and helpful in moving the legislation forward. We are now at a point where we are within 24 hours of passing the legislation. Most of all, I thank my colleague from Connecticut, Senator Lieberman, who has been a faithful partner--to use a play on words--a faithful partner in putting this initiative together.

We have worked together closely with the President, who has been truly the motivating force to try to provide some ammunition to the armies of compassion out there on the front lines every day, fighting for hope and opportunity for the millions of Americans who have yet to realize their dreams in dealing with the problems that confront them.

The President has, through his faith-based initiative, been very clear in the role of charitable organizations, particularly people of faith within those organizations, to heal many of the ills that confront society. We are a society that, while very prosperous by any measure, even at a time of economic downturn that we are experiencing right now, we are still the wealthiest country in the history of the world. With that great wealth comes responsibility. So many people have taken up that responsibility, trying to meet and serve those who in a society of great wealth have experienced a multitude of problems in trying to achieve, both from the economic perspective but again, as I said before, pursuing their dreams.

This piece of legislation, while it is not everything the President requested--it is not all of his faith-based initiative--certainly gets at one of the most important components which is the one funding organizations which do charitable purposes or have charitable purposes.

No. 2, there is a provision called the Compassionate Capital Fund which is grants to small organizations with less than six employees or less than $\1/2\ million in funding, to go out and be able to, for the first time, compete for Federal funds.

A lot of these small organizations, most of which are faith based in nature, have not been successful in applying for government grants principally because they don't have the resources or the expertise to do so. When you are running a food pantry with one or two people, most of whom are part-time employees and many volunteers, you don't have the expertise to apply for Federal grant dollars or any other kind of grant dollars. You try to do what you can to make ends meet. This provides the kind of technical assistance necessary for a lot of smaller, mostly inner-city organizations that right now do not take advantage of the money available through the Federal Government, again, whether they are faith based or not.

Most of these organizations are faith based in nature so there is a faith component to this. As I will show later, many of the provisions in the act will have a disproportionate benefit to

charitable organizations which are faith based.

It doesn't accomplish a couple of the things the President set out to do. The issue Senator Durbin spoke of earlier having to do with equal treatment, even though it is not in this legislation, let me address it very briefly and then maybe in more detail later on.

The whole concept of equal treatment is to allow those who have some element of faith within their organization--and there is a whole range across the charitable organization horizon. There is a whole range of faith, how much faith is integrated into those organizations--some are, to use the term, ``saturated'' or completely faith based in nature and expressively faith based in their programs, to the whole range of the other side which are those that are exclusively secular and even to some degree hostile to faith. In between there are gradations.

What the President has tried to do is instead of, as we do right now, as we did prior to the 1996 welfare reform, which allowed for charitable choice, in other words, for some government programs to go, these dollars to go to faith organizations, we sort of eliminated all these people of faith and all these organizations that have faith as a component of their mission or their vision or their program and left it to a very rather narrow category.

We, in 1996, on the Senate floor, with President Clinton signing it, said we would stop that discrimination against people of faith who wanted to act based on their faith to help their fellow man, as long as they didn't do certain things such as use it for faith worship or proselytizing, things that are not delivery of service.

We expanded greatly the range of faith organizations and nonfaith organizations. We expanded greatly those who can participate in government funds. When you do that, you run into some problems, some questions.

We have seen tremendous success and very few cases where problems have arisen, but in the areas where they have, there have been questions as to what government statutes apply, what provisions or regulations apply to faith organizations as opposed to nonfaith organizations.

One of the principal questions has to do with people's religious liberties and their ability to practice their faith bumping up against other rights. The one that the House of Representatives dealt with and the Senator from Illinois referred to had to do with the issue of employment and whether religious organizations which are provided with government funds can say that someone cannot work for that organization or they can refuse to hire someone who works for that organization who doesn't share that organization's values with respect to tenets and teaching of the faith which is expressed through their program.

One of the things I believe is essential to a lot of faith organizations, one of the reasons that faith organizations should be and need to be included in providing social services, is that a lot of these faith-based organizations don't just treat the symptom. They don't just treat the hunger, if it is someone who comes in for food assistance, or they don't just treat the dependency on drugs or alcohol, if someone comes in for addiction treatment. It doesn't just treat the problem of a lack of a GED or education, if someone comes in for education and training. What they do, because of their mission, they treat the mind. They treat the spirit and they treat the emotional well-being of this person. They treat the whole person. That is one of the keys to success in trying to truly turn people's lives around in a way that brings them back into productive life in America.

The key to these faith organizations is having people who have this mission they share out there teaching and bringing people in based on a certain core value structure. My argument is, we should not discriminate against people who have programs that are value laden-- those values may be based on Scripture, the Old or New Testament or some other book--as opposed to saying we are going to discriminate against you because the values you have are based upon a religious belief, as opposed to an organization that is secular and its values are not based on a religious belief. I don't understand the reason for the discrimination. I don't believe it should exist.

I have had this discussion in brief, and we can talk more about it. I am sure we will. But having said all that, none of that is in this bill. We decided not to have this issue before us today because the need of getting resources out to the charitable organizations meeting human service and educational and other needs is, frankly, too urgent.

While we will debate this--and I am sure others will want to debate this issue--the true debate will wait for another day. That will be when the welfare reauthorization comes up. That is where this whole conversation of charitable choice and allowing faith-based providers to participate in government grants came about, back in 1996. And it is where we should continue that debate. I pledge to you that whether we get that bill or have that amendment in committee, or whether we bring it to the floor, this will be a topic of discussion and one I encourage all Members to think about and participate in.

But the charitable crisis is real, and that is why I agreed--and my colleagues in the House have been more than cooperative in putting together, hopefully, a compromise we can quickly get to the President's desk. We understand the crisis is real. Adjusted for inflation, charitable giving 2 years ago, in 2001, was 2.3 percent lower than in 2000. You have to remember at the end of 2001, unfortunately, we had to deal with the aftermath of 9/11, where there was a tremendous outpouring of giving. Even with that outpouring of giving, because of the sluggish economy, charitable giving fell again last year. Corporate giving fell again between 2000 and 2001 by 14.5 percent.

Again, we don't have the final numbers for 2002, but it was supposed to be off again last year. We saw the American Red Cross--I'll give a couple of examples. Their contributions declined anywhere from 20 to 60 percent; Salvation Army, off 5 to 10 percent; United Way, off 4 to 5 percent. We can go on and on. Colleges and universities saw a decline in the amount of charitable giving to their organizations, too.

So what we are doing is trying to respond in a comprehensive way. When I say that, I mean if you look at this bill, it is carefully crafted to provide incentives for all different types of givers-- corporate, foundations, and individuals who don't itemize on their tax forms. By the way, if those with IRA rollovers want to give money to charitable organizations, they can do so without having to pay taxes under this legislation. So whether it is the small giver to, hopefully, the retiree, or someone who has a large IRA, or corporations who may want to give more money--all the way down the line to food donations, which is another area where the Senator from Indiana, Senator Lugar, has a provision in this legislation that I think is very important, we have a provision that will encourage literally billions of dollars of additional food donations over the next several years by providing a tax incentive for corporations; but for the first time, partnerships, individual proprietors, and S corporations will be able to take the fair market value of their donation as a deduction--it is up to twice the cost of the basis of that food item--as a deduction for giving to charitable purposes.

We have about a billion pounds of food donated right now to people in America to help feed the hungry in America. It feeds about 26 million people. There are 96 billion pounds of food wasted in America. That is just an enormous amount. It is almost incomprehensible that we are talking about that amount. When you consider the fact that roughly 1 billion pounds of food donated helps feed 26 million, can you imagine, if we just increase it by a very small percentage, the amount of donated food there could be and how many people we could feed in America?

Senator Lugar's legislation is included. We believe it will make a dramatic impact on hunger in America. There are a lot of other provisions.

I see my colleague from Indiana, Mr. Bayh. I will be on the floor for a while. I want to give him the opportunity to share with us some of the things he has been active with. He has a provision in the legislation he has shepherded through the process. I will have him talk about that. He has also been a champion and strong supporter of this legislation and the entire package from day one. I thank him for his support,

and I appreciate him coming to the floor to talk about this issue.

I yield the floor.

Mr. President, I see the Senator from Indiana. I yield to him as much time as he may consume.

Mr. President, I thank the Senator from Indiana for his overly kind words with respect to my participation in this legislation. The Senator from Indiana has been truly one of the people out front and has been very supportive. I cannot count the number of press conferences I have asked the Senator from Indiana to be at trying to keep this ball rolling, and at times with a very busy schedule. He has always found time to associate himself with this cause and to continue to make sure it was on track in a bipartisan way.

That is how we get things done around here. I am very happy to have him as one of the prime cosponsors of this legislation. I again appreciate very much his kind words, but even more so appreciate his tremendous effort on making this legislation a reality.

I see the Senator from Rhode Island. If he is on a time schedule, I will be happy to yield the floor to provide him an opportunity to speak.

Mr. President, I thank the Senator from Rhode Island for his kind remarks with respect to the compromise that Senator Lieberman and I have engaged in to move this legislation forward. I appreciate his support of this legislation, as I do that of all of my colleagues.

As he stated, and he is correct, I do take issue with his perspective on the issue of charitable choice and the funding--allowing of government funds to be used by organizations that have some element of faith within their structure, whether it has been the guiding principles of the organization or with the programs that they administer.

I do not believe it violates the ``separation of church and state.'' I do believe organizations of faith should not

be discriminated against. We should not be in the business of just funding a set of organizations that have no faith component in them at the expense of those that do--for a lot of reasons, not the least of which is there is a lot of evidence out there, most of which is anecdotal I understand, but a growing body of evidence that organizations of faith are much more effective in dealing with problems, particularly the more systemic problems that we have.

But I object to the underlying premise of this argument that somehow or another we are violating the Founding Fathers' understanding of the separation of church and state.

I talk at a lot of schools. I ask kids: What words are in the Constitution, ``the free exercise of religion'' or ``separation of church and state''? Usually about 75 to 80 percent of the kids say, ``separation of church and state'' is in the Constitution, which of course it is not.

The Senator from Rhode Island talked about the genesis of that in referring to one of the Founding Fathers, referring to the establishment clause as erecting a wall of separation between church and state. But what were they talking about? They were talking about certainly the country from which they came, which was England, which had an established church. The Government funded the church, as many European countries did historically, for long periods of time. Certainly prior to the Reformation, the Catholic Church was intertwined very much so with the state. After the Reformation, each reform church had its own country and was funded in many cases.

People came to this country for religious freedom. They did not want an established religion. But even at the time in America there were certain colonies that had affinities for different religions. Maryland, for example--neighboring Maryland was considered more of a Catholic colony. Pennsylvania was home to the Quakers--on down the line.

There was a concern that that could come over here to this country, so they put in this clause that we should not have an established religion.

The difference is between the constitutional provisions that allow for the free exercise of religion and the prohibition against the establishment of religion. But this is really about freedom of religion; in other words, to practice whatever religious tenets you want and for the government not to get in your way in doing so.

What some are really arguing is freedom from religion, which I can tell you is completely antithetical to what our Founding Fathers believed.

We will have this debate. I am looking forward to it because I think it is important for the Senate, arguably the greatest deliberative body in the world, to talk about these important issues.

The role of faith in our society is central. It is central to the success of America. One of the reasons we are a successful country is because we are a faith-filled country. One of the reasons we are a faith-filled country is because we have a tremendous marketplace of ideas, whether it is the street-corner preacher or the old church down the street that has been there for centuries.

We have a marketplace of ideas of faith and that is what makes us: People out preaching the Word, talking about the values that faith imparts and the messages that faith imparts and its relevance to people's lives.

Here is a statistic I just marvel over. There are more people who go to church in America over a weekend, church and synagogue and temple, than to all the sporting events throughout the entire year in America. On one weekend, more people go to their places of worship than to all the sporting events that are held in America over the course of a year. That is remarkable. It is a great thing about America. It is what makes us unique. It is because we have not established religion. But it is not because we are saying people need to be free from religion. I think that is one of the concerns I have with the tack that the Senator from Rhode Island was taking.

Let me mention a couple of issues. Again, this is the beginning of a debate that is not about this bill. I repeat, we have taken everything having to do with the concept of equal treatment out of this legislation. We will save that debate for another day. But there are some things in this legislation I would like to address very briefly.

I see the Senator from New Jersey. I will not keep him long.

One of the items I am most excited about in this legislation is a provision called individual development accounts. Senator Lieberman and I and Senator Feinstein and many others, who have been advocates of this legislation for quite some time, are very excited about it being part of this initiative. Individual development accounts are a matched savings account for low-income and low- to moderate-income individuals who will have an opportunity to put up to $500 a year into a savings account and have that matched, dollar for dollar, up to $500. So it will be $1,000 total.

It is an exciting opportunity for these individuals to be able to put money aside. For what? So they can put it aside for three reasons: to buy a home, to get education, higher education, or, in some cases, technical training, vocational training, as well as start a small business, start a business. So it is a way for people to save for events in their lives that can transform their future economically: better education; a home, a place where they can save, invest, and build equity.

As everybody knows in this Chamber, the place where most people have the bulk of their savings is in their home, in the equity they have in their home. So the opportunity for home ownership, and having that money for a downpayment, is so important. And IDAs create that opportunity.

And finally, for starting that small business, being that entrepreneur--that spirit really drives America and really is the ladder of success so many people in America have access to--we want to create a nest egg for people to be able to buy that first piece of equipment. If you want to start a landscaping service, you can buy that lawn mower, you can buy the other tools you need to do that job, or a variety of other interests people get engaged in as their first business.

So we, Senator Lieberman and I, are very excited about this opportunity. We think it builds not just the opportunity for access to the home or to the education or to that small business, but it builds the virtue of deferred gratification. That is a virtue we sometimes do not practice very much in America, but it is a virtue of delaying the expenditure of that dollar, to put it aside, to save it for something that is more important than what you immediately have before you. And when I am talking about gratification, I am not talking about luxuries. I am talking about maybe simple things, maybe very minor things in the lives of people who are low to moderate income. But deferring that to something that may be transformational in their lives is really something we should create incentives to do because, again, it helps people move up that ladder of success in America.

I see a couple of my colleagues are in the Chamber. I am happy to yield the floor for their input.

Reserving the right to object, I may have a Senator on the way down to the Chamber who is trying to fit in here. How long is the Senator from New Jersey going to speak?

I have no objection.

Madam President, I suggest the absence of a quorum.

Mr. President, I commend Senators Grassley and Baucus for bringing this important legislation to the floor, but I particularly commend and thank Senators Santorum and Lieberman for their principled and tireless efforts to bring this legislation to the floor and for recognizing that original versions of this legislation contained elements that were, to say the least, controversial.

Senator Santorum particularly recognized the need to provide additional resources to faith-based organizations and other charitable organizations through new incentives in the tax code to encourage people to contribute to charities. All of these issues compelled him to make a very difficult choice, a very important choice, and I think a very statesmanlike choice to send to the floor today a version of the bill that I assume will get the unanimous approval of this Senate.

It recognizes our shared belief that the more resources we can direct to organizations that are committed to helping people, the better off we will be. The increase in the social service block grant is a tremendous step forward and is something I know I am proud of, but certainly the Senator from Pennsylvania has to be very proud of because he is the principal architect of this effort, and the new tax advantages also are very important.

Indeed, Senator Santorum and Senator Lieberman worked very hard to improve legislation that in the other body was submitted as the Community Solutions Act of 2001, known as H.R. 7 in the 107th Congress. That legislation contained a number of controversial and potentially unconstitutional provisions, but they worked very diligently, very carefully, very thoughtfully to eliminate those provisions from their bill and ultimately today to bring this legislation to the floor, which I think and believe will get, as I said, unanimous approval by this body. Certainly I approve of it.

The CARE Act is going to provide increased resources for needed social services, and it is going to do so without including at this juncture troubling provisions that were in the original House bill. I know the Senator from Pennsylvania reserves his right to engage again on this issue--in fact, I believe he will exercise his right in all forums, and that is the glory of this body, and we shall engage in more extended debate, I think, in the future. But this afternoon is an opportunity to commend him, thank him, and recognize his wise and statesmanlike conduct. I again thank Senator Santorum.

The debate about church and state in this land precedes, indeed, the Constitution of the United States. It has been ongoing since the early days of the American experience. Religion has been an important part of our national life throughout our history. Indeed, European immigration in large part was motivated by the search for an environment conducive to freedom of conscience and religious exercise unhampered by State involvement.

Today, in the year 2003, religion remains a vital force in our national life and religiously affiliated institutions play a critical role in the provision of social services. For example, in 1996, Federal, State, and local governments granted $1.3 billion to Catholic Charities USA, comprising 64 percent of its budget. In 1999, 53 percent of Catholic Charities' budget came from State and local governments, and an additional 9 percent came from the Federal Government.

In 2001, United Jewish Communities received a Federal grant of $59.8 million. If indirect payments were included--for example, Medicaid, Medicare, vouchers, or food stamps--the amount flowing through religious organizations would be significantly higher.

Both of these mission-driven, faith-based groups are independently or separately incorporated as nonprofits and both are able to distinguish their religious activities from their secular social services activities.

So an initial point we must recognize in the debate about faith-based initiatives is that it is not whether religious groups will or should play a role in the spiritual and temporal lives of Americans--they do, and they will continue to do so--nor is the question about whether the government discriminates against faith-based charitable groups. The question is how the important roles faith-based organizations play can continue to meet the constitutional requirement of separation between church and state, both as a matter of law and as wise public policy.

This constitutional standard has strengthened religion in America compared to other countries around the world. We can see on the nightly newscasts the effects of intolerance across the globe, of established religions battling other beliefs. In America, we have been spared much of that. I believe it is directly attributable to the wise condition included in the First Amendment.

My awareness and sensitivity to these issues might spring in large part from my roots growing up in Rhode Island. As a child, I learned the history of Roger Williams and the founding of the colony of Rhode Island and Providence Plantation. Upon leaving the enforced orthodoxy of the Massachusetts Bay Colony, Roger Williams started a settlement that ultimately became Rhode Island. This settlement was founded on his belief, in his words: ``that no man should be molested for his conscience.''

The spirit of Roger Williams was captured by his contemporary, John Clarke, in the petition for a new royal charter by the people of Rhode Island in 1663. In his words, the people of Narragansett Bay:

have it much in their hearts, if they may be permitted, to

hold forth a lively experiment, that a flourishing and civil

state my stand, yea, and best be maintained. . . . with a

full liberty in religious commitments.

As a result of this religious liberty, Rhode Island became a refuge for people persecuted for their religious beliefs elsewhere. And Anabaptists, Quakers, and Jews settled in Rhode Island because of its commitment to religious liberty and tolerance.

This lively experiment became a model for the Founding Fathers and helped lead to the drafting of the First Amendment: ``Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.''

In explaining what the First Amendment meant to the Danbury Baptist Association in 1802, Thomas Jefferson wrote that the combined effect of the establishment and free exercise clauses of the Constitution was a ``wall of separation between church and state.''

Jefferson's comments were not unique to him. Senator Durbin has already made a reference to President

James Madison. President Madison what was meant by this separation of church and state extremely clear in several messages he delivered on Government funding of religious endeavors. In 1811, he vetoed a congressional bill granting the use of some Federal land to a church in the Mississippi territory. President Madison stated:

Because the bill in reserving a certain parcel of land in

the United States for the use of said Baptist Church

comprises a principle and precedent for the appropriation of

funds to the United States for the use and support of

religious societies, contrary to the article of the

Constitution which declares that ``Congress shall make no law

respecting a religious establishment''. . . Resolved. That

the said bill does not pass.

Indeed, I find it interesting that conservatives would so cavalierly dismiss so much of the history of this country and disregard so many of the fundamental principles of the Founding Fathers. President Bush and his conservative followers want to transform the relationship between church and state by directly funding pervasively sectarian organizations. He has done this by regulation and by Executive order, since he has largely been unsuccessful in accomplishing these tasks through the legislative process.

Just consider some of the changes that he has advanced thus far. In a June 2001 Department of Justice memorandum, the Department of Justice took the legal position that faith-based organizations that are given Federal taxpayer dollars to run governmental programs should be able to engage in employment discrimination on the basis of religion. Subsequent to this memorandum, the President by Executive order overrode a rule first enunciated by President Franklin Roosevelt that the Federal Government should not give contracts to employers who engage in discrimination on the basis of religion. Thus, it is now the position of the White House that government contractors can discriminate.

The President believes the government should fund faith-based organizations who use proselytization and prayer to cure drug addiction and other social programs. In his State of the Union Address, President Bush cited one such program in Louisiana that expressly combats drug abuse with faith. The head of another often-cited religious program, Teen Challenge, boasted to Congress that he was not only able to get kids to stop using drugs, he converted Jews into Christians in the process.

In newly proposed HUD regulations, the Administration says that Federal funds can be used to construct a religious building used for religious activities if the building also can be used for a public purpose such as counseling or a food pantry. At least that is the proposal.

With these and other initiatives, the President is attempting to breach the wall the Founding Fathers set up between church and state. These initiatives are clearly designed to fund proselytization and to promote certain types of religion.

There are legal challenges being raised to many of these proposals. But the long and short of it is, we have an opportunity to debate and to decide these issues through the legislative process, and we have an obligation to do so. And when there is a more robust, more extensive attempt to legislatively condone or sanction these faith-based initiatives, I believe there are going to be three major areas we will need to address.

One area is effective restraints on proselytization with taxpayer funds. The second is compliance with local regulatory standards in the delivery of public programs. And the third is prohibiting the use of public funds in employment discrimination.

First, with respect to proselytization. If the separation of church and state means anything, then in my mind, it must mean that no American should be compelled to pass a sectarian test or participate in sectarian exercises to receive a public benefit. This principle should be included in legislation and not left to the more shifting sands of regulatory pronouncements.

Second, many advocates of faith-based initiatives argue that they simply want a level playing field. Let's take them at their word. If State licensing arrangements are appropriate and necessary to protect children in publicly funded programs, why should religious providers be exempt from such licensing requirements? If we consider this issue, we will need to look for the even application of local and state laws, particularly laws with respect to the protection of children and public health. This is what we will need to do in order to truly create an even playing field.

Finally, we must address the issue of employment discrimination. Title VII provides an exemption for religious groups in certain situations. In the Amos case, the Supreme Court held that a religious group using its own funds may claim the Title VII exemption. In the words of the Court, the purpose of the exemption was to alleviate ``significant governmental interference with the ability of religious organizations to define and carry out their religious missions.''

Today, with respect to the Administration's proposal, we must recognize that rather than seeking autonomy from governmental interference, religious groups are seeking taxpayer funds to carry out governmental responsibilities. Indeed, in the one unreported case that has ruled on the use of public funds in this way, the court, in this labor case, concluded that the title VII exception does not apply.

As James Madison said in 1785, in his ``Memorial and Remonstrance Against Religious Assessments,'' in opposition to a proposal by Patrick Henry that all Virginians be taxed to support teachers of the Christian religion:

If ``all men are by nature equally free and independent,''

. . . above all are they to be considered as retaining an

``equal title to the free exercise of Religion according to

the dictates of conscience.'' Whilst we assert for ourselves

a freedom to embrace, to profess and to observe the Religion

which we believe to be of divine origin, we cannot deny an

equal freedom to those whose minds have not yet yielded to

the evidence which has convinced us. If this freedom be

abused, it is an offense against God, not against man: To

God, therefore, not to man, must an account be rendered.

All of this leads me to my final point. In the words of the New England poet, Robert Frost, ``Good fences make good neighbors.'' What might be permissible under the law does not always guarantee the wisest policy.

We need to remember that as we debate the President's faith-based initiative, religion has thrived in America because few people confuse religion with government. Religion has been a citadel of conscience and a check on government because it draws its strength and its support from its adherents, not from bureaucratic patrons.

The religious communities of America that have been unequivocally supporting the President's attempts to allow discrimination with Federal dollars might be mindful of the old saying: Be careful of what you pray for.

As the House of Representatives has made clear, we are going to be discussing this issue in the upcoming months on welfare, SAMSHA, National Service, and other programs. It is my hope the Senate will undertake a more careful look at how the charitable choice provisions in these bills inhibit the free exercise of religion, rather than encourage it.

Again, I thank the sponsors and the chairman and ranking member of the Finance Committee for bringing this bill to the floor. This is something we will all support, and we will do so with the notion and the idea and the commitment to provide resources for people who want to help other people, and do so consistent with the spirit and the letter of the Constitution.

I yield the floor.

Mr. President, I am introducing today on behalf of myself and Sen. McCain two separate bills relating to stock options. Stock options are unfinished business from the last Congress. They are the 800-pound gorilla that has yet to be caged by corporate reform.

Stock options allow a company's employees, usually its top executives, to purchase company stock at a set price for a specified period of time, perhaps 10 years. If the stock price rises after the option is issued, the executive can exercise the option, buy the stock at the set price, and then sell it on the open market at a profit. Today, most CEOs of U.S. publicly traded companies receive a large percentage of their pay from stock options.

Despite their widespread use, stock options remain a stealth form of compensation because, under current accounting rules, they never have to appear on the company books as a compensation expense. In fact, they are the only form of compensation that companies do not have to book as an expense at any time. In addition, stock options are the only form of compensation that a company can claim as a deductible business expense on its tax return, even when no expense is ever recorded on the company books.

These stock option accounting and tax rules are inconsistent and illogical. The two bills we are introducing today, the Stock Option Accounting Review Act, and the Ending the Double Standard for Stock Options Act, were introduced in the last Congress to address this problem. Each bill tackles a different aspect of the stock option issue. One addresses stock option accounting; the other addresses the stock option tax deduction.

Last year, Senator McCain and I proposed the accounting provision as an amendment to the Sarbanes-Oxley corporate reform bill that was before the Senate in July. There appeared to be sufficient support to pass it at the time, but we were unable to obtain a vote on it or on any other stock option legislation. That is why we are back this Congress.

Congress failed to resolve the issue last year, even though stock option abuses were repeatedly linked to serious corporate abuses and dishonest accounting. In fact, virtually every corporate disaster that has struck in recent years has had a stock option component.

Enron, of course, was the poster child. Congressional investigations, including by the Permanent Subcommittee on Investigations on which I sit, showed that, at the same time Enron investors and employees were losing their shirts, Enron executives were cashing in their stock options for tens or hundreds of millions of dollars. Ken Lay, the Chairman of the Board, took home $123 million from stock options in 2000 alone. Jeff Skilling, the CEO, took home over $60 million. Another executive, Lou Pai, topped them all by cashing in Enron stock options, in 2000, for $265 million.

Stock options also contributed to Enron's inflated earnings, since despite providing the lion's share of executive pay, this compensation never appeared on the company books as an expense nor was it ever deducted from earnings. And many have blamed stock options for encouraging Enron management to rig the company's financial statements through other accounting deceptions to help boost apparent income and, in turn, the company stock price, so they could sell their Enron stock at enormous profit.

Still others have noted that Enron used about $600 million in stock option tax deductions to avoid paying any corporate income taxes in four out of the last five years before its bankruptcy while, at the same time, touting record amounts of corporate income. What is now only beginning to be understood is that Enron's stock option tax deductions played a central role in much of its wrongdoing, after all, Enron was able to inflate its corporate income with impunity, in part, because its stock option tax deductions allowed it to avoid paying taxes on any of its phony inflated income.

Enron was the poster child for stock option abuses, but it was far from the only company in that category last year. Worldcom, Tyco, Qwest Communications, and many others have stock option stories that are equally disturbing.

And the problems did not stop with companies engaged in accounting deceptions or other corporate misconduct. Even companies that never appeared on the 2002 rollcall of corporate deception have been excoriated in media reports for giving huge stock option pay to executives while socking employees and investors with lower stock prices, mounting losses, and lousy corporate performance.

High tech companies that have been the biggest promoters of stock options have been some of the biggest culprits. Company after company in Silicon Valley paid their executives big bucks via stock options while laying off employees, losing money or market share, and stiffing investors. One example frequently cited in the media is Lawrence Ellison, CEO of Oracle Corp., who exercised options in 2001 to obtain profits of $706 million, while his company's stock price dropped by more than 50 percent.

Aggregate stock option statistics are also sobering. Business Week, for example, has estimated that stock options now account for ``a staggering 15 percent of all shares outstanding.'' Federal Reserve Chairman Alan Greenspan estimated that stock options have been used to overstate reported company earnings by an average of 6 to 9 percent. Perhaps that is why Chairman Greenspan has picked honest stock option accounting as his number one post-Enron reform.

Stock option abuses have been linked to inflated company earnings, dishonest accounting, and executive misconduct. These abuses have been facilitated by existing accounting and tax rules which allow stock option compensation to never appear on a company's books as an expense, even when a company claims this compensation as a business expense on its tax return. This double standard is fueling Enron-style abuses, and it is time for it to end.

Many in the U.S. business community apparently agree and, unlike the Congress, have taken direct action on the stock option issue. In fact, over the last year, there has been significant movement in the business world to end dishonest stock option accounting.

Over 120 companies, including such American giants as Coca-Cola, General Motors, General Electric, Dow Chemical, Wal-Mart, and Home Depot have announced that they will begin expensing options in 2003, joining longtime expensers like Boeing and Winn-Dixie. Standard and Poors has created additional pressure for honest stock option accounting by announcing a new ``core earnings'' calculation for companies which requires stock option compensation to be subtracted from a company's earnings.

Accounting experts are also moving. The International Accounting Standards Board in London has announced that, by the end of 2003, it will issue accounting standards requiring companies to expense stock options. The U.S. equivalent, the Financial Accounting Standards Board, or FASB, has announced that it will decide by the end of the first quarter of this year whether it will issue stock option accounting standards similar to those of the International Board.

While there has been a major shift in the U.S. business world toward honest stock option accounting, not all companies are on board. Some companies, especially those in the high tech sector, have announced that they will not expense stock options until forced to do so. That means, until FASB acts, there will be a discrepancy between those companies that are voluntarily expensing options and those that are not, when there ought to be a level playing field where everyone plays by the same accounting rules. It is this discrepancy that continues to make our stock option legislation relevant and necessary for Congressional action this year.

Let me describe both bills.

First is the Stock Option Accounting Review Act. This bill is very simple. It would direct FASB to conduct a fresh review of the current accounting treatment for stock options and, within one year, establish what it deems to be the appropriate stock option accounting standards.

The bill does not specify the stock option accounting standards that FASB should issue; that matter is left to the experts where it belongs. But

the bill does put the Senate on record as urging FASB to review the existing rules and take appropriate action within one year. This legislative directive is important, because the only other time the Senate has spoken on this issue, in 1994, the Senate majority urged FASB to keep allowing companies to exclude stock option expenses from their financial statements. The Senate's position contradicted FASB's position at the time which was to require stock option expensing. It is long past time for the Senate to rescind its mistaken advice.

The second bill we are introducing today is the Ending the Double Standard for Stock Options Act. This bill would not address the accounting treatment of stock options. Instead, it would address the tax treatment of stock option compensation, ending the costly double standard in federal law which allows a company to take a tax deduction for stock option compensation, even if the company does not show that compensation as a business expense on its financial statements.

Essentially, our bill would prevent a company from claiming a stock option expense on its tax return unless the company also includes that expense on its books. It would require companies to be consistent in how they treat stock options, and take a corporate tax deduction that mirrors the expense shown on the company books. If a company took the position that it incurred no expense from stock option compensation on its books, the bill would allow the company to take that position, but would also require it to take the same approach on its tax return and forego any deduction. The bill would stop companies from telling stockholders one thing, that it has no stock option expenses, while telling the opposite to Uncle Sam.

And to add insult to injury, in 2001, the IRS issued Revenue Ruling 2001-1 which determined that companies whose tax liability was erased through stock option expenses were not subject to the corporate alternative minimum tax. That revenue ruling meant that our most successful publicly traded companies, if they doled out enough stock options to insiders, could arrange their affairs to escape paying any taxes. That absurd result leaves the average taxpayer feeling like a chump for paying his fair share when a company like Enron can use its success in the stock market to apparently end up tax free.

One last point. Some opponents of stock option reform argue that reining in stock options would hurt the average worker, but this contention is nothing more than a red herring. While many average workers are eligible for stock options, few actually receive them. Stock options are overwhelmingly reserved for top corporate executives.

A recent Bureau of Labor Statistics survey did the research. This nationwide government survey found that in 2000, a banner year for stock options, only 1.7 percent of non-executive workers actually got any stock options. The BLS survey also looked at corporate executives and found that only about 5 percent of these corporate executives received any stock options. These results are consistent with the findings of a private sector group not associated with the government called the National Center for Employee Ownership, which favors stock options. Looking at a small sample of companies, the Center reported that 70 percent of all stock options were given to managers rather than other employees, and about 50 percent were given to the most senior executives. The reality is that stock options are a perk mainly reserved for a very small group, and neither average workers nor most executives would be affected by honest accounting or consistent tax and accounting treatment for stock options.

It is also important to understand that neither of our bills would bar any company from issuing stock options. Companies would still be able to issue stock options to their executives and other employees. The goal of this legislation is not to stop the use of stock options, but to promote honest accounting and consistent treatment of stock options on federal corporate tax returns.

Stock option abuses have damaged investor confidence in American business. I hope our colleagues will support enactment of these bills to help restore investor confidence and end stock option abuses. I ask unanimous consent to have reprinted in the Record after my remarks the text of both bills.

Mr. President, I am introducing today legislation to provide the Securities and Exchange Commission with stronger administrative authority to detect, investigate, and punish corporate and individual misconduct. This legislation, the SEC Civil Enforcement Act, among other measures, would provide the SEC with new authority to impose administrative civil fines on those who violate federal securities laws. The bill is cosponsored by Senators Bill Nelson, Corzine, and Biden.

The SEC has repeatedly requested the new enforcement tools that this bill would provide, and I ask unanimous consent to print in the Record after my remarks a copy of a letter from SEC Chairman Harvey Pitt supporting enactment of this legislation.

Mr. President, it is with profound honor and reverence that I,

together with my friend and colleague, Senator Feinstein, introduce a bipartisan constitutional amendment to permit Congress to prohibit the physical desecration of the American flag.

The American flag serves as a symbol of our great Nation. The flag represents, in a way nothing else can, the common bond shared by an otherwise diverse people. As a sponsor and long-time supporter of the proposed constitutional amendment to protect the American flag, I am very pleased, but not surprised, by the way Americans have been waving the flag as a symbol of solidarity following the September 11 attacks of 2001. The emotion that Americans feel when they see the stars and stripes confirms my view that the flag is much more than a piece of cloth--it is a unifying force that represents the common core ideals all Americans share. Whatever our differences of party, race, religion, or socio-economic status, the flag reminds us that we are very much one people, united in a shared destiny, bonded in a common faith in our nation.

More than a decade ago, Supreme Court Justice John Paul Stevens reminded us of the significance of our unique emblem when he wrote:

A country's flag is a symbol of more than nationhood and

national unity. It also signifies the ideas that characterize

the society that has chosen that emblem as well as the

special history that has animated the growth and power of

those ideas. . . . So it is with the American flag. It is

more than a proud symbol of the courage, the determination,

and the gifts of a nation that transformed 13 fledgling

colonies into a world power. It is a symbol of freedom, of

equal opportunity, of religious tolerance, and of goodwill

for other peoples who share our aspirations.

Throughout our history, the flag has captured the hearts and minds of all types of people--ranging from school teachers to union workers, traffic cops, grandmothers, and combat veterans. In 1861, President Abraham Lincoln called our young men to put their lives on the line to preserve the Union. When Union troops were beaten and demoralized, General Ulysses Grant ordered a detachment of men to make an early morning attack on Lookout Mountain in Tennessee. When the fog lifted from Lookout Mountain, the rest of the Union troops saw the American flag flying and cheered with a newfound courage. This courage eventually led to a nation of free men--not half-free and half-slave.

In 1941, President Franklin Roosevelt called on all Americans to fight the aggression of the Axis powers. After suffering numerous early defeats, the free world watched in awe as five Marines and one sailor raised the American flag on Iwo Jima. Their undaunted, courageous act, for which three of the six men died, inspired the Allied troops to attain victory over fascism.

In 1990, President Bush called on our young men and women to go to the Mideast for Operations Desert Shield and Desert Storm. After an unprovoked attack by the terrorist dictator Saddam Hussein on the Kingdom of Kuwait, American troops, wearing arm patches with the American flag on their shoulders, led the way to victory. General Norman Schwarzkopf addressed a joint session of Congress describing the American men and women who fought for the ideals symbolized by the American flag:

[W]e were Protestants and Catholics and Jews and Moslems

and Buddhists, and many other religions, fighting for a

common and just cause. Because that's what your military is.

And we were black and white and yellow and brown and red. And

we noticed that when our blood was shed in the desert, it

didn't separate by race. It flowed together.

General Schwarzkopf then thanked the American people for their support, stating:

The prophets of doom, the naysayers, the protesters and the

flag-burners all said that you wouldn't stick by us, but we

knew better. We knew you'd never let us down. By golly, you

didn't.

The pages of our history show that when this country has called our young men and women to serve under the American flag from Lookout Mountain to Iwo Jima to Kuwait, they have given their blood and lives. The crosses at Arlington, the Iwo Jima memorial, and the Vietnam Memorial honor those sacrifices. But there were those who did not.

In 1984, Greg Johnson led a group of radicals in a protest march in which he doused an American flag with kerosene and set it on fire as his fellow protestors chanted: ``America, the red, white, and blue, we spit on you.'' Sadly, the radical extremists, most of whom have given nothing, suffered nothing, and who respect nothing, would rather burn and spit on the American flag than honor it.

Contrast this image with the deeds of Roy Benavidez, an Army Sergeant from Texas, who led a helicopter extraction force to rescue a reconnaissance team in Vietnam. Despite being wounded in the leg, face, back, head, and abdomen by small arms fire, grenades, and hand-to-hand combat with vicious North Vietnamese soldiers, Benavidez held off the enemy and carried several wounded to the helicopters, until finally collapsing from a loss of blood. Benavidez earned the Medal of Honor. When Benavidez was buried in Arlington National Cemetery, the honor guard placed an American flag on his coffin and then folded it and gave it to his widow. The purpose of Roy Benavidez' heroic sacrifice--and the purpose of the American people's ratification of the First Amendment--was not to protect the right of radicals like Greg Johnson to burn and spit on the American flag.

The American people have long distinguished between the First Amendment right to speak and write one's political opinions and the disrespectful, and often violent, physical destruction of the flag. For many years, the people's elected representatives in Congress and 49 state legislatures passed statutes prohibiting the physical desecration of the flag. Our founding fathers, Chief Justice Earl Warren, and Justice Hugo Black believed these laws to be completely consistent with the First Amendment's protection of the spoken and written word and not disrespectful, extremist conduct.

In 1989, however, the Supreme Court abandoned the history and intent of the First Amendment to embrace a philosophy that made no distinction between oral and written speech about the flag and extremist, disrespectful destruction of the flag. In Texas v. Johnson, five members of the Court, for the first time ever, struck down a flag protection statute. The majority argued that the First Amendment had somehow changed and now prevented a state from protecting the American flag from radical, disrespectful, and violent actions. When Congress responded with a federal flag protection statute, the Supreme Court, in United States v. Eichman, used its new and changed interpretation of the First Amendment to strike it down by another five-to-four vote.

Under this new interpretation of the First Amendment, it is assumed that the people, their elected legislators, and the courts can no longer distinguish between expressions concerning the flag that are more akin to spoken and written expression and expressions that constitute the disrespectful physical desecration of the flag. Because of this assumed inability to make such distinctions, it is argued that all of our freedoms to speak and write political ideas are wholly dependent on Greg Johnson's newly created ``right'' to burn and spit on the American flag.

This ill-advised and radical philosophy fails because its basic premise--that laws and judges cannot distinguish between political expression and disrespectful physical desecration--is so obviously false. It is precisely this distinction that laws and judges did in fact make for over 200 years. Just as judges have distinguished which laws and actions comply with the constitutional command to provide ``equal protection of the laws'' and ``due process of law,'' so too have judges been able to distinguish between free expression and disrespectful destruction.

Certainly, extremist conduct such as smashing in the doors of the State Department may be a way of expressing one's dissatisfaction with the nation's foreign policy objectives. And one may even consider such behavior speech. Laws, however, can be enacted preventing such actions in large part because there are peaceful alternatives that can be equally powerful. After all, right here in the United States Senate, we prohibit speeches or demonstrations of any kind, even the silent display of signs or banners, in the public galleries.

Moreover, it was not this radical philosophy of protecting disrespectful destruction that the people elevated to the status of constitutional law. Such an extremist philosophy was never

ratified. Such a philosophy is not found in the original and historic intent of the First Amendment. Thus, in this Senator's view, the Supreme Court erred in Texas v. Johnson and in United States v. Eichman.

Since Johnson and Eichman, constitutional scholars have opined that an attempt by Congress to protect the flag with another statute would fail in light of the new interpretation currently embraced by the Supreme Court. Thus, an amendment is the only legal means to protect the flag.

This amendment affects only the most radical forms of conduct and will leave untouched the current constitutional protections for Americans to speak their sentiments in a rally, to write their sentiments to their newspaper, and to vote their sentiments at the ballot box. The amendment simply restores the traditional and historic power of the people's elected representatives to prohibit the radical and extremist physical desecration of the flag.

Restoring legal protection to the American flag will not place us on a slippery slope to limit other freedoms. No other symbol of our bi- partisan national ideals has flown over the battlefields, cemeteries, football fields, and school yards of America. No other symbol has lifted the hearts of ordinary men and women seeking liberty around the world. No other symbol has been paid for with so much blood of our countrymen. The American people have paid for their flag, and it is our duty to let them protect it.

This amendment offers Senators, from both sides of the aisle, the opportunity to stand united for the protection of the sacred symbol of our nation.

Restoring legal protection to the American flag is not, nor should it be, a partisan issue. More than 40 Senators, both Republicans and Democrats, have already joined with Senator Feinstein and myself as original cosponsors of this amendment. I am pleased that this amendment has the unqualified support of our distinguished colleagues: Senators Ted Stevens; Zell Miller; John McCain; John B. Breaux; Larry E. Craig; John E. Ensign; Richard G. Lugar; Blanche Lincoln; Max Baucus; Christopher S. Bond; Trent Lott; Ernest F. Hollings; Mark Dayton; Jeff Sessions; E. Benjamin Nelson; James M. Inhofe; Jim Bunning; Wayne Allard; Susan M. Collins; Michael D. Crapo; Michael DeWine; Bill Frist; Charles E. Grassley; Chuck Hagel; Kay Bailey Hutchinson; Pat Roberts; John W. Warner; George Allen; Sam Brownback; Conrad R. Burns; Pete V. Domenici; Judd Gregg; Rick Santorum; Richard C. Shelby; Olympia J. Snowe; Lindsey Graham; John Cornyn; James Talent; Lamar Alexander; Ben Nighthorse Campbell.

Polls have shown that 80 percent of the American people want the opportunity to vote to protect their flag. Numerous organizations from the American Legion to the Women's War Veterans to the African-American Women's clergy all support the flag protection amendment. All 50 State legislatures have passed resolutions calling for constitutional protection for the flag.

I am, therefore, proud to rise today to introduce a constitutional amendment that would restore to the people's elected representatives the right to protect our unique national symbol, the American flag, from acts of physical desecration.

I ask unanimous consent that the text of the proposed amendment be printed in the Record.

I am very honored to be a cosponsor with my dear friend from California, Senator Feinstein. I appreciate the effort and unwavering support she has put forth in this battle. I am proud and privileged to be able to work with her.

I ask unanimous consent that the text of the bill be printed in the Record.