To amend the USA PATRIOT ACT to extend the sunset of certain provisions of such Act.

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I rise to make an opposite point of view and critical comments on a statement that was made yesterday by the Senator from North Dakota, Mr. Dorgan. Once again, he made a very impassioned case, and everybody who hears him knows he presents his case very well. He made an impassioned case for American workers whose jobs have been lost when plants move overseas.

We have all witnessed this heart-wrenching event. I know even in my home State of Iowa we have had plant closings for that reason. Some of those operations have been moved out of the United States. But as far as Iowans are concerned, let me remind you this has been a phenomenon of plants moving from Iowa to other places for a long time, before we ever heard the word ``outsourcing.''

I remind my colleagues I was a member of the International Association of Machinists at a sheet metal factory, the Waterloo Register in the town of Cedar Falls, IA. We made furnace registers. I started working there in 1961, when I was a young member of the Iowa Legislature, to supplement the income of a citizen legislator, and also to supplement the income of a young farmer getting started at that time because I was only farming 80 acres at that time. Even in 1961, you could not make a living farming 80 areas. You could not make a living getting $3,000 every other year being an Iowa legislator. So I became a factory worker.

At about 1971, the people who owned our company decided people in Texas would work for less money than people in Waterloo, IA, so they moved the plant to Texas. Our job was shut down. Our job was lost. The outsourcing was not to China, it was to Texas. I presume that 25 years later there were jobs that moved from Iowa to Texas that eventually moved to Mexico, and then it was not long Mexico was losing jobs from Mexico to China. Now we hear about jobs moving from China to someplace else, where somebody is going to work someplace else for a lower wage. I guess when you have a planet of 6.5 billion people, and people want to eat, they want jobs, somebody is going to seek that work and do it. So I believe I have been a victim of outsourcing not to China but to Texas. But it is still a problem today, and it is one for which we have to have sympathy.

Senator Dorgan, obviously, presents a great case for those people. But I want people to know I have lived through that and know what it is like when I am commenting because I do not want people to think I am unsympathetic to outsourcing. But I think we have to recognize the economic facts of life, whether it is my job at the Waterloo Register in Cedar Falls, IA, or whether it was 250 years ago when manufacturing jobs left Great Britain to come to the Colonies in the United States of America.

Now, I want to say, unfortunately, Senator Dorgan's amendment--if it is the same one we saw in 2004. And you can tell from the debate that we just had that we do not have the language on these amendments, and we are begging for them. Anybody who believes in transparency of Government ought to get these amendments out here. There is no reason to be secretive about the people's business because everybody is watching us right here on television. We are not trying to hide anything. So we need to see those amendments.

But the point is, if it is like the amendment in 2004, that amendment will not do one thing to bring jobs back to America. In fact, it could very well cost even more U.S. jobs. I would like to explain, then, why I come to this conclusion.

This amendment, if it is similar, repeals deferral for property imported into the United States by a foreign subsidiary of a U.S. company, without regard to whether that property was ever previously produced, manufactured, or grown in the United States.

This means the amendment by Senator Dorgan fails to focus on their primary complaint that U.S. companies are shutting their plants, moving production offshore, and selling back into the United States. The bill does not focus on this scenario. Instead, it overshoots the mark by hitting all goods sold into America by U.S. companies, even if it is impossible for those goods to be produced in America.

For example, if a produce company sets up a banana farm in Costa Rica to import bananas into the United States and around the world, the income from sales to the United States is not eligible for deferral. I may be mistaken on this point, but I am not aware of too many banana farms in Texas or Florida, so I do not see how allowing a banana farm in Costa Rica is going to cost U.S. jobs.

Similarly, if a U.S. company wanted to start a mining operation in some faraway land to extract a new and exotic mineral that is not found at home, they could see that anywhere in the world, but they cannot import that back into the United States without triggering the impact of this amendment.

Or let's look at coffee. We have a lot of coffee shops on our streets these days. If they set up their own coffee plantation in Brazil, they would be hit by the Dorgan amendment. I think we only raise coffee in one State in the United States, and maybe they do not do that in Hawaii anymore. But there is not much coffee raised in the United States. We sure do not raise it in my State of Iowa.

Our friends from New York and New Jersey ought to consider the effects of this amendment on Puerto Rican residents who work in plants owned by subsidiaries of U.S. companies. Many of the U.S. multinationals have manufacturing subsidiaries in Puerto Rico that import products into the U.S. market. Since our Tax Code treats Puerto Rican corporations like foreign corporations, this amendment would hit those companies very hard. But it would not hit their foreign-owned competitors who sell into the United States.

It seems Senator Dorgan's amendment would allow a U.S. company to sell a foreign-produced good to anyone in the world except Americans, but it would allow a foreign-based company to sell those same goods to Americans. When you stop to think about looking out for the benefit of Americans, this does not make any sense.

I have described how the bill would operate, but I do not think this is the intent of the legislation. What I believe is intended is that deferral should be denied if a company closes a U.S. plant, produces the goods offshore, and then imports the goods back into the United States.

This does not actually happen very often. We have had this debate before. The last time I spoke on this issue was when we were debating the JOBS bill back in 2004. I do not think much has changed since then.

At that time, the latest Department of Commerce data on U.S. multinationals showed that only 7 percent of foreign subsidiary sales were into the United States--only 7 percent.

Nevertheless, this amendment insists that the rule of ``deferral'' in our tax law is somehow a ``tax benefit'' that moves jobs offshore and allows you to not pay taxes on foreign income. This is not true, of course. Deferral has nothing to do with moving jobs, and it never forgives taxes that are owed on foreign profits of U.S. companies.

Many U.S. companies, however, choose to reinvest their foreign earnings in foreign markets, and so the U.S. tax on those earnings is, then, indefinitely deferred.

As Senator Dorgan noted, the JOBS bill, that we call the American Jobs Creation Act of 2004, did contain a provision that provided U.S. multinationals a temporary ability to receive dividends from their foreign subsidiaries at a reduced tax rate. Now, it is important to note that companies could only avail themselves of this reduced rate on an amount of earnings they identified in SEC filings as ``permanently reinvested.'' That is a legal term, which means they had no intention of bringing that money back to the United States.

Senator Dorgan's characterization of that provision is misleading, and I would say in two ways. First, Senator Dorgan calls the repatriation provision a tax cut of over $100 billion. To arrive at that huge number, the Senator's calculation must assume these companies would have brought close to $340 billion of their foreign earnings home in the absence of the repatriation provision of the JOBS bill.

Now, the fact is--and I get this from scoring by the nonpartisan Joint Committee on Taxation--this provision has a cost to the Treasury of not $100 billion but $1.9 billion over 5 years and $3.3 billion over 10 years; and it actually scored as a revenue raiser in the first year of $2.8 billion.

Now, I plan on looking at the actual results of this repatriation provision when all the facts are in, after the fact. You are kind of guessing before you pass a bill. But after it has operated for a couple years, then you get a chance to get a real look at it. So we are going to look at this repatriation provision. But the Joint Committee on Taxation must have scored this provision as a raiser in year 1, and a relatively small cost over 5 and 10 years, because 5.25 percent of a large amount that was repatriated is a lot more than 35 percent of a much smaller amount that would have been repatriated otherwise.

In other words, it is not as much money coming back into this country, and if it does not come back here, it is not taxed.

I am not here to defend the repatriation provision or those companies that laid off workers or took advantage of the repatriation provision. I am just as troubled by those announcements as Senator Dorgan. I am simply pointing out that Senator Dorgan's characterization of that provision as a $100 billion tax cut is extremely misleading.

Second, Senator Dorgan talks as if the repatriation provision was the cornerstone of the American Jobs Creation Act, and it was kind of an appendage. In fact, the repatriation provision was a very small part of the bill. One of the key pieces of the JOBS bill was the manufacturing deduction which does actually give a tax break for companies that manufacture, leaving jobs here or creating jobs here. The Joint Committee on Taxation scored this provision as a cost to the Treasury of $76 billion over a 10-year period. That is, in fact, a tax cut, and it is a tax cut that will maintain jobs in America and will create jobs because one of the problems for American corporations compared to international competition is the high tax rate that we have on corporations compared to a lot of other countries. Those other countries are waking up. Just look at Ireland, look at Europe, what we are talking about doing now--sometimes through the European Union, sometimes through individual countries. They are seeing great advantage by reducing the corporate tax rate in their respective countries.

Two years ago, we thought we had moved ahead of them. Now they are following suit. We may have to go back and look at our corporate tax to find out if we are going to continue to be noncompetitive.

I would like to go back to the deferral issue. The rule of deferral exists to keep U.S. companies competitive in the global marketplace. Deferral is not something new. It has been in our tax laws since 1918. We have debated the rule of deferral on several occasions, and we will no doubt continue to do so when we debate tax reform proposals.

Opponents of deferral too often make wild accusations about how this rule, which has been in place since 1918, spells doom for the American worker. Of course, none of this is true. In fact, just the opposite is true because we must always be vigilant about enhancing international competitiveness for our U.S. companies. Hence, deferral ensures an ever-growing base of opportunity for U.S. companies and, more importantly, their employees at home and abroad.

U.S. multinationals are a critical component of our economy. These companies operate in virtually every industry and, the last time I checked, have investments of more than $13 trillion in facilities located within the United States. As employers, they provided 23.5 million jobs for Americans in the year 2001. That was nearly 18 percent of the payroll jobs in the United States. They had a payroll of $1.1 trillion. When you go back to this debate we had in the year 2004, I noted at that time that the U.S. multinationals created more than 53 percent of the manufacturing jobs in America and employed more than two U.S. employees for every foreign worker. Those were the latest years for which I had figures, but I have no reason to believe it is different today.

During the 10 years from 1991 to 2001, U.S. multinationals increased domestic employment at a faster rate than the overall economy. A recent study confirms that U.S. multinationals are significant job creators, and those jobs are not created through ``exporting'' jobs to foreign nations with low-labor and low-tax costs, as Senator Dorgan contends. The Department of Commerce data shows that the bulk of the U.S. investment abroad occurs in high-income, high-wage countries.

Again, referring to the year 2001, 79 percent of foreign assets and 67 percent of foreign employment of U.S. multinationals were located in high-income, developed nations such as Australia, Canada, Hong Kong, Japan, New Zealand, Singapore, South Africa, and the countries of the European Union. We have to remember a very simple maxim for why companies go into foreign markets: 4 percent of the people in the world live in the United States. If you want to create jobs in America and you just want to sell to that 4 percent, you are going to have a very limited market. Whether you are in agriculture, like I and my son and grandson are, selling corn and soybeans overseas, or whether you are manufacturing John Deere tractors, whatever you are manufacturing, if you want prosperity, you go where the market is. That is the 96 percent of the people who don't live in the United States.

Again, referring to that debate on the JOBS bill in 2004, fully 95 percent of the world's population and 80 percent of its purchasing power--so the only new thing I am giving is not that 96 percent of the people live outside of the United States, but 80 percent of its purchasing power--is located outside the United States. Foreign sales growth has outstripped domestic sales growth. So our companies are taking advantage of selling to the rest of the world. This increased growth requires increased employment wherever you can find it. The good news is that foreign growth also results in U.S. job growth.

A recent study confirmed that during the 10 years from 1991 through 2001, for every one job that U.S. multinationals created abroad, they created nearly two U.S. jobs in their parent corporations. That is why it is critical to our economy that U.S. companies remain competitive in the international marketplace.

I would like to review a more rational explanation of deferral and how it works to keep our U.S. companies competitive. The United States taxes all of the worldwide income of its citizens and corporations. The U.S. income tax applies to all domestic and foreign earnings of U.S. companies. The United States fully taxes income earned overseas by foreign subsidiaries of U.S. companies. However, many foreign countries tax their companies on a territorial basis, meaning that they only tax income earned within their country's borders and don't impose tax on the earnings of foreign subsidiaries. Major countries using this territorial system of corporate taxation are Australia, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Luxembourg, Netherlands, Sweden, and Switzerland. A company from one of these countries that uses the territorial tax system has great advantage over U.S. companies.

For example, a U.S. company with a Singapore subsidiary will pay U.S. tax and Singapore tax on the subsidiary's income. A French company with a Singapore subsidiary will pay Singapore tax but no French tax. This means that a U.S. company in Singapore has a higher tax burden than a French company in Singapore. Two basic tax rules answer this problem and seek to put U.S. companies on a level playing field with foreign competitors from territorial countries. The first rule says that when foreign income is brought home, the U.S. allows a reduction against U.S. tax for any foreign taxes paid on that income. The foreign tax credit prevents the U.S. from double-taxing foreign earnings which would make our companies noncompetitive in the international marketplace. And like deferral, this has been in the tax law since 1918.

The foreign tax credit, however, is limited. It may only offset the U.S. tax on that income which is currently imposed at a 35-percent rate. If the foreign tax rate is higher, the credit stops at 35 percent. If the credit is lower, say 10 percent, then additional U.S. taxes

will be owed up to the full 35 percent. In this example, an additional 25 percent of the taxes would be owed to the United States, which is the difference between the 10 percent and 35 percent of the U.S. rate.

The second basic tax rule is that U.S. companies are allowed to defer U.S. tax on income from the active business operation of a foreign subsidiary until that income is brought back into this country, usually in the form of dividends paid to the U.S. parent. This is referred to as the rule of deferral, meaning that the U.S. tax is deferred until the earnings are brought back. This is the rule the Dorgan amendment attacks.

It is important to note that deferral is not the forgiveness of tax. It simply means that we impose the full U.S. tax when foreign earnings are repatriated to the United States instead of doing it the very day of earning. The reason that we defer tax on active business operations is so that U.S. companies can remain competitive with foreign companies that have a different system of taxation than what we have. I am referring to what I called the territorial tax. We don't defer tax on passive activities like setting up an offshore bank account or other passive investments. We tax passive activities yearly. But active operations are subject to competitive disadvantage.

For example, if we impose U.S. tax today on the profits of a Singapore subsidiary, then the U.S. company will pay a 35-percent tax in the United States, net of any Singapore taxes, but that French competitor located right next door in Singapore will pay only the Singapore tax. If the Singapore tax rate is less than 35 percent, which is the U.S. tax rate, then the French competitor will have a tax advantage. Who wants to give any advantage to a French competitor? This is because the United States allows a foreign tax credit to offset the U.S. income tax imposed on those foreign earnings but only up to the 35 percent U.S. corporate rate.

If the foreign rate is less than the U.S. 35 percent rate, then residual U.S. taxes are owed on the difference between the U.S. tax rate and the foreign rate. For example, if a Singapore tax is 15 percent and the U.S. tax is 35 percent, then the United States will impose an additional 20 percent on those Singapore earnings. The French company, however, would only pay the 15 percent Singapore tax. If we did not allow deferral on that additional 20 percent of tax, then the U.S. company today would have a 20-percent tax disadvantage compared to the French company.

The question on repealing deferral is whether we want to hand over the world market to companies from France and Germany and other countries that have a different system of taxation than we have, called the territorial system. Repealing deferral means that we export our high U.S. tax rates to U.S. corporations around the globe. The United States has one of the highest corporate tax rates in the world. There are few countries with rates higher than the United States. This means that without deferral, U.S. companies will be at a continual worldwide disadvantage compared to their foreign competitors.

That is why we defer U.S. tax on active business operations, so that U.S. companies can be competitive in the global marketplace.

Some Senators have proposed repealing deferral or cutting back on it, as Senator Dorgan's amendment would do. These proposals would export the high U.S. tax rate to U.S. operations around the world. That would be fine if all companies around the world were paying the high U.S. tax rate, but, as I have said so many times, they are not. We have one of the highest corporate tax rates in the world. Companies of foreign countries are not subject to our tax laws and are usually taxed at lower rates. This all brings us back to the implications of Senator Dorgan's proposal. It would enhance the competitive advantage of foreign-owned multinationals over U.S. multinationals.

Our focus in considering this amendment must be on the ability of American companies to compete within the United States as well as in foreign markets if we want to maintain and create jobs in America. The issue is not whether we tax foreign earnings currently but whether we cede the U.S. market to foreign competition.

The Dorgan amendment will increase taxes on U.S. companies, but their foreign competitors in the U.S. will not face a similar tax increase. This can lead to a loss of domestic market share, or even if market share is maintained, losses may be incurred on domestic sales because of pricing pressures and uncompetitive margins created by the additional tax burden.

No one is happy when companies move abroad to a tax haven to avoid U.S. tax. But let me tell you another side effect of the proposal to eliminate and cut back on deferrals. In the American Jobs Creation Act of 2004--that bill I always referred to as the JOBS bill--we enacted a provision that prevents corporate inversion, where a company would pretend to move its corporate headquarters to Bermuda, to a simple post office box there, and do it not because they are going to do anything productive there but for the sole purpose of avoiding U.S. taxes. Many U.S. multinationals complained that inversions were necessitated by an inability to compete with foreign-owned multinationals that aren't subject to the higher U.S. tax rate.

We should be proud, then, that we shut down those inversions, those shell corporations, those postal box corporations which do nothing over there except go there to avoid tax and then make the situation even worse for honest corporate taxpayers in America that are paying the tax into the Federal Treasury. But in the process of doing that, we didn't do it at the expense of repealing deferral. Now that we have shut down inversions, if we repeal deferrals, or significantly cut back on them, the only other alternative that would be available to U.S. multinationals would be to sell themselves to foreign companies or to be taken over by a foreign company in a possible hostile takeover. If we prevent U.S. companies from deferring their foreign profits, we will see more and more U.S. multinationals being bought out by foreign-owned multinationals. Tax changes have consequences.

Increasing taxes on U.S. multinationals will not bring jobs back to America. You only pay taxes if the company is profitable, and you only stay profitable as long as you remain competitive. But in the United States, taxes are 35 percent cost-to-profit, and that is where a competitiveness disadvantage can occur when a U.S. company is competing against foreign companies that will not incur this tax increase.

Senator Baucus and I held hearings a couple years ago regarding the effects of the international competition within the United States, so we as leaders of the Finance Committee are very familiar with the effects of these kinds of rate differentials.

I think a quote by Joseph Guttentag, international tax counsel of the Clinton administration, during testimony before the Finance Committee in July of 1995 is a very good place to end this debate. So I end with this quote:

Current U.S. tax policy generally strikes a reasonable

balance between deferral and current taxation in order to

ensure that our tax laws do not interfere with the ability of

our companies to be competitive with their foreign-based

counterparts.

Now, if that position just expressed by Joseph Guttentag, international tax counsel in the Clinton administration, the last Democratic administration, testifying before a Republican Congress, isn't good enough evidence that the route Senator Dorgan wants to go is the wrong route and a route contrary to previous leaders of his own party, then I don't know what will be evidence that this position is going to make American companies uncompetitive, not go to the marketplace of the other 96 percent of the consumers around the world outside the United States, and consequently creating jobs in the United States, and I don't know what it takes to convince him that position is a wrong position for the United States and is so different than what we have traditionally had for the Tax Code since 1918. When I say 1918, that goes back almost to the beginning of the income tax in the United States.

I yield the floor.

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

I will make some additional points on the Dorgan tax haven included in the Conrad substitute. I share Senator Conrad's concerns about the ability of large corporations to manipulate the Tax Code, to shift large amounts of profit offshore, but this provision is not the right way to address those concerns. It is very overbroad and inadequate. It is overbroad because it harms the competitiveness of United States multinationals, repealing deferral for holding company structures

that allow them to efficiently allocate active foreign generated resources among their foreign operations without incurring U.S. tax on entirely foreign transactions.

It is inadequate because it applies only to the subsidiaries in black-listed countries. Companies that use tax savings for abusive purposes could easily avoid this rule by locating in a low-tax country that is not on the list.

Ireland would be a perfect example of that, where we read press reports that companies such as Microsoft are shifting huge profits. Treasury would have authority to add countries to the list, but does anyone think Ireland, with whom we already have a tax treaty, would be added to that black list? The way to deal with those cases is through effective transfer pricing policy and enforcement, not by curtailing deferrals.

Another issue that is going to be soon before us is the Democratic substitute of revenue raisers that are in our bill. I am flattered by the tax relief side of Senator Conrad's substitute amendment since it includes extension of the same widely applicable tax relief provisions in the underlying bill.

I should also be flattered, and I am, by some of the pay-fors in that amendment--in particular, the provisions regarding the so-called SILO transactions. It is a fact that we shut down the abusive tax shelters that involve U.S. corporations claiming tax benefits on foreign subways and sewer systems in 2004. So these deals can no longer be done. The underlying bill would repeal a generous grandfather provision for certain domestic deals and would deny benefits for foreign deals entered into before the effective date of the JOBS Creation Act of 2004.

We have introduced a fully offset tax relief bill in the past. Most recently, that act of 2004 produced $82 billion of tax relief that was completely offset. The underlying bill, in fact, contains almost $20 billion of offsets while providing $90 billion in broad-based tax relief. We do not need any more offsets to pay for the lost AMT revenue that we never intended to collect and for other provisions, such as the R&D credit, for example, that are broadly supported as good for the economy.

We all know tax receipts are on the rise. In 2005, we had $274 billion more coming in over the taxes that came in in 2004 under the same tax policy, and we exceeded the CBO baseline by--can you believe it--$97 billion. It is a very vibrant economy which produces that kind of revenue. That amount, whether it is the $274 billion in 2005 over 2004 or the $97 billion above the CBO baseline, that amount exceeds the $70 billion of reconciled tax relief over 5 years provided in the budget resolution.

So I hope we will be able to take these points I have just made about the inadequacies of the amendments we are going to be dealing with when we vote on these amendments.

I would now, Mr. President, speak on the issue of an amendment I am going to place before the Senate this afternoon. In fact, I will submit this amendment at this point.

I wish to take just a few minutes, in offering this amendment, to speak about amendments that are also offered by Senator Bingaman and Senator Nelson regarding the Medicare prescription drug program. I thank the Senators for their amendments. I know their intentions are good and their hearts are in the right place. But having said that, I am forced to oppose the amendments, and my reasons follow.

Opponents of the benefit are trying to make it look as if Republicans are indifferent to the problems of the implementing part of the Medicare program. Such is not the case because everyone has to be concerned about the issues faced by some beneficiaries in getting their prescription drugs, even if that might be a very small percentage of the people who are involved. Whoever needs these prescriptions, we have to do everything we can to get them to them.

Like everybody else, I am concerned about the drug benefit implementation issues. It is not acceptable that some of the most vulnerable and frail seniors are experiencing problems. But my opposition to the amendments is rooted in the goal of not just taking some action, but that we need to take the right action when we act. There is no question that Congress meddling could just make things worse.

With that in mind, I want to share with you the following quote as to another new program that was getting underway:

As the program gets under way the danger is that the

strains on it will generate pressures for unsound change.

They will come from those who will be disappointed because

they have been led to expect too much as well as from those

who see failure in every shortcoming. Changes will come in

time, but they should be made on the basis of the program's

own experience. This program must be given ample time to get

over its growing pains.

Now, that is not about the prescription drug bill that is just now going into effect. That is a quote from the July 1, 1966, edition of the New York Times, and it is about the implementation of the original underlying Medicare Program passed by Congress a year before this July 1 edition of the New York Times.

Now, when I read that quote of 1966 just now, it said ``the program'' instead of ``Medicare'' because I did not want to give it away. The point of this editorial is that those words are extremely relevant today.

I am not trying to make excuses or minimize the difficulties some are having. Those problems need to be fixed, and fixed fast. By all accounts, everyone is working hard to get them resolved. But in my opinion--echoed by the New York Times nearly 40 years ago--rushing to ``fix'' things through legislation could do more harm than good.

Just last week, the Finance Committee, in a bipartisan setting--with almost every member of the Finance Committee there--had a meeting with Secretary Leavitt and CMS Administrator Mark McClellan. We had a candid discussion about the unfortunate glitches, and we heard about steps taken by the agency to address them. We had a very constructive dialog. That dialog covered a range of issues the Agency had identified and the administration's actions already taken to address them.

It is clear to me legislation is not needed at this time. Secretary Leavitt has the authority. Current law allows him to have a smooth transition. And administrative actions will work faster than if we pass this legislation. That is because changes in law have to be followed by more administrative actions. This is very much going to slow things down. That is not what we want. We want, need, and will get quick action.

The issues that have surfaced do not lend themselves to legislative fixes. For example, we talked about problems in the data files. The data files have not always identified the plan where a dual eligible is enrolled. Obviously, that is a problem. But can Congress write a law to dictate exactly how to fix computer system data files? That is not something I would want to do. There is an opportunity for getting something wrong, if I ever saw an opportunity for Congress to do something wrong.

But more importantly, these amendments are unnecessary. Senator Bingaman's amendment gets at issues that have already been addressed administratively. CMS has the authority to address these that way. And it will get fixed faster than if we pass additional legislation.

So I am going to offer a sense-of-the-Senate resolution. That resolution expresses our concerns about these problems, and it expresses the Senate's support for the Agency's efforts to fix them.

For example, prescription drug plans must have a first-fill policy. The first-fill policy already requires at least 30 days of coverage for the first prescriptions filled, even if the drugs are not on the plan's formulary. And just yesterday, Secretary Leavitt announced that the first-fill policy is being extended further. It is now going to be in place for 60 or 90 days as a first-fill policy. The Bingaman amendment requires only a 30-day policy. So it is already out of date. The administrative actions are much faster. Changes in law are not needed to address the issue.

Now, here is another one. The Bingaman amendment says that dual- eligible beneficiaries, whom we call dual eligibles, should be presumptively eligible. But the dual eligibles are already automatically eligible under the law, and they are automatically assigned to a plan. So again, no change in law is required.

Another example. The Bingaman amendment says it would require plans to reimburse enrollees for cost-sharing

problems. Here again, plans are already responsible for the costs to cover drugs. They are responsible for reimbursing beneficiaries for any cost-sharing charged in error. No change in law is required.

Let me give you another one. Some States have stepped up to fill claims during the transition. The Bingaman amendment requires States to be reimbursed for their costs. This is already happening. Last week, Secretary Leavitt announced that the Federal Government will reimburse States for costs they have incurred during the transition period. We were told that that day we met with Secretary Leavitt. I do not know exactly when Senator Bingaman was there, but he was there for that meeting. Not every Senator stayed for every minute of the meeting, but Secretary Leavitt made this very clear. So again, legislation is not needed because administrative action is being taken, with the legal authority of the Secretary to do it. So no additional legislation is needed.

Senator Nelson's amendment would extend the enrollment period through the end of the year and permit beneficiaries to change once before the end of the year. We have discussed this amendment before. The Senate has already voted twice, and we voted it down twice. And changing the enrollment period does nothing to address any of the issues experienced by beneficiaries just this last month.

We are well into the enrollment period. Enrollment is exceeding expectations. Twenty-four million beneficiaries out of 44 million, potentially, have prescription drug coverage. Every day, nearly 90,000 beneficiaries are enrolling in the program, and about 1 million prescriptions are being filled daily. So again, legislation is not needed.

There are a number of resources for beneficiaries to help them choose a plan. There is the Medicare call center. It is available 24 hours a day, and the Medicare Web site. Every State has counselors available to assist beneficiaries through the State Health Insurance Information Program. That is the whole point of that program--the SHIIP program, it is called for short--to help beneficiaries understand their Medicare benefits. The prescription drug plans based their proposals to serve Medicare beneficiaries on the enrollment period specified in the law.

In addition, there are already rules in place under which a beneficiary can change their enrollment outside of the open enrollment period. A beneficiary can seek what is called a special election period if that is needed for that individual--for example, if a plan fails to provide a beneficiary with information about the plan's benefits on a timely basis, or if it fails to provide benefits in line with quality standards, or if the plan, its agent, or plan provider materially misrepresents the plan in marketing that plan. So in all of these instances, there can be a special enrollment period or an opportunity to change.

So again, we do not need legislation. These are issues already covered in the law today.

I want to make another point about what is going on with these amendments. There was a time when opponents of this benefit were concerned that there wouldn't be enough choice. Now their concern is that there is too much choice. When we were in conference with the House on this 2 years ago, we were fearful there might not be a choice for people. So we provided if there wasn't a choice, the Secretary set up a subsidized choice so that every individual could at least choose from two. We wanted people to have choice. We followed the Federal Employees Health Benefit Plan where people have the choice of many plans to choose from, and they get to change once a year. We wanted to make sure we didn't cram anything down any senior citizen's throat. If they didn't want to participate, if they were satisfied with Medicare the way it was, they didn't have to. But if they wanted to participate, they elected.

You don't write one plan for 44 million seniors because everybody has different benefits. And one-third of the people already had some prescription drug coverage. We didn't want to screw up their plans. So we subsidized those plans so that those people who had something they wanted would be able to keep it. I don't know when you satisfy people. I didn't think there would be enough choice. Now we are hearing complaints about too many choices. There are 44 million Americans; there are 44 million different personal needs of those people. We, sitting on the floor of the Senate, are not going to figure out what those 44 million needs are and pass a one-size-fits-all plan that is going to satisfy the needs of everybody.

The point is, the opponents of this new benefit will complain and fight it no matter what happens. I hope everyone remembers that. I also find it ironic that folks think that legislation is the answer. These are the same people who are concerned about confusion. Now they are proposing legislative changes in a bill that has only been in operation for 1 month, on top of administrative actions that the agency has already taken. They want to screw that up with legislation on the floor of the Senate with changes that will have no impact on any of the problems encountered this last month, legislation that would have to be followed by yet more administrative action, a snowball rolling down the hill, just getting more complicated as it rolls on.

I ask whether this is going to help these perceived problems. Well, not just perceived problems; I admitted there are problems out there. I admitted when you put something like this into place, there are growing pains, just like I quoted that New York Times article from 1966 about the growing pains that we were going to have with Medicare when it was first put in place. Do you think these things are going to smooth the transition? I don't think so. Talk about opportunity for confusion among beneficiaries, pharmacists, and plans. This is not going to reduce the confusion.

Passing legislation now runs the very real risk of undermining and complicating things. It can undermine the progress already made. It will interrupt actions taken by the administration. It will create more problems, not fewer problems. I, for one, have a steadfast commitment to gaining a full understanding of the problems and pursuing the most appropriate and timely course of action.

When the Secretary came before my committee and everybody turned out to make their complaints known, and the Secretary announced at that time seven problems and he announced at that time seven solutions to those problems and took full responsibility for them, I had a feeling people left that meeting fairly satisfied that nobody was going to blame somebody else and they had a grasp of the problems and solving problems, with some accountability that some changes had already taken place for the better.

So then when you come out of an environment of a committee meeting like that, you wonder what planet they have been on when these amendments are being offered--amendments that, if they were passed, would not get to the President for another 30 days--to solve problems that were evident 30 days ago that the Secretary has already identified and taken action to overcome.

Senator Baucus and I are working together to get to the bottom of this issue. That is how we do it in our committee. We do it in a bipartisan way so that we are going to also be able to work together if it turns out that legislation is needed. But I asked the Secretary at that very committee meeting: Do you need any legislative changes to take care of these problems that we have all identified, particularly the seven that he identified? He said: No, he had ample legislative authority to do it.

An important part of Senator Baucus's and my work in this regard is going to be brought up at next week's Finance Committee hearing, an open hearing. We will hear from Dr. McClellan. We will hear from representatives of the plans. We will hear from pharmacies. We are, most importantly, going to hear from the people involved in educating and enrolling beneficiaries into the plan. More than once I have heard Members take issue with attempts to bypass the committee process. The amendments before us are just that.

Senator Bingaman's amendment has not gone through the Finance Committee. It is clear that this amendment falls within the jurisdiction of the Finance Committee, and the Senator from New Mexico is a member of that committee. I ask him to work within

the committee. If the Senate proceeds on legislation that the full committee has not considered, then nothing would prevent the Senate from legislating on other Finance Committee issues without the benefit of hearings or committee action.

Next week's hearing is very important. We need to gather more information about what is happening. This is needed to inform all of us of any necessary response. In the absence of such information gathering, it is dangerously premature to consider any amendments related to the prescription drug program. We all know that this whole issue of Medicare prescription drug coverage has long been a political issue. With the amendments offered today, I can't help but think that is very unfortunate. It is also unfortunate that is probably not going to change during the 109th Congress.

On the other hand, I hope that is not the case. But here we are, just 1 month into the prescription drug program, already we see a lineup of amendments to perhaps the most inappropriate vehicle there could ever possibly be to deal with Medicare. In other words, these amendments are on a tax bill. But more importantly than just the process, these amendments are unnecessary because of administrative actions taken to date or to be taken tomorrow, if a new problem comes up.

When these amendments that I have discussed--the Bingaman and Nelson amendments--come up for a vote, I hope my colleagues will trust what we learned in the committee: that the Secretary of HHS doesn't need any new legislative authority, consequently bringing any more uncertainty into this process by voting for these amendments. Vote them down.

I said that I had an amendment I wanted to have considered when we vote this afternoon. I send the amendment to the desk and ask for it to be printed.

I yield the floor. And since nobody else is desiring to speak, I suggest the absence of a quorum.

Mr. President, I disagree with the proposal in two important parts.

First, the proposal does not extend to 2009 several provisions that are very important to both sides, bipartisan--specifically, the section 179 expensing, which encourages the growth of small business in our country, and the college tuition deduction, which will give parents more certainty in the planning of their children's education, and the low-income savers' credit, which assists families who make less than $50,000 in saving for their retirement.

The second point I have----

I only have 1 minute.

We don't have that time.

Then I will take 30 seconds, too.

All I can say in my 30 seconds on my point is that the Senator may be entirely correct, but that is one of the things that happens when we have 2 days of debate and these amendments are not put before the Senate to study until the last minute.

The second concern I have about the proposal is the inclusion of offsets which we have not had an opportunity to fully consider or with respect to which we have some policy concerns. An example of that is the revival of the environmental excise tax offered, referred to as the ``Superfund tax.'' As you might expect, I believe the bill passed by a bipartisan majority with 64 votes in the Senate in November, which we are not going through again, represents a more balanced bill, one that provides longer-term benefits, including increased certainty and reduced complexity for planning.

In addition, I raise a point of order that the budget does not meet reconciliation instructions to the Senate. It is an issue of germaneness, Mr. President.

Mr. President, I move to reconsider the vote.

Mr. President, the amendment expresses the sense of the Senate about the concerns regarding the problems encountered in implementing the new drug benefit. It expresses the Senate's support for the administration's efforts to fix them. These efforts have proven to be much speedier in getting the problems fixed, and fixed fast, than any legislation can do. To that point, one amendment offered yesterday has provisions that are completely unnecessary because administrative actions have already taken care of it. I see no point in legislating for the sake of legislating.

Moreover, legislative action on top of administration action will undermine and complicate progress to date.

I urge my colleagues to support this sense-of-the-Senate amendment.

I call up amendment No. 2731.

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

Mr. President, I object to this amendment. Remember, all but two of our members of the Committee on Finance, Republican and Democrat, joined with Secretary Leavitt to go over the problems 2 weeks ago that this program is having. Secretary Leavitt took responsibility for those problems. He laid out seven problems. He laid out seven solutions to those problems that he has already inputted.

I asked him if he needed additional legislative authority to solve these problems. He did not need any additional legislative authority. He had plenty. We are going to pass legislation now that not only will take a while to get passed, but we will also have a period of time afterwards of having regulations to administer that legislation.

The problem goes on and on. The problem is being solved by the Secretary right now. Let's not screw up what the Secretary is trying to do, something that is working very well. There are problems, yes, but those problems are identified, and they can work.

I raise a point of germaneness on this amendment. I raise a point of order under section 310 of the Budget Act, and I ask for the yeas and nays.

Mr. President, I call up amendment No. 2732.

Mr. President, the problem with the Dodd amendment is that it doesn't even do what the author says it does. He says it is paid for by using capital gains, but capital gains offsets don't even come into play until the year 2009. The author is leading us to believe that the military assistance is coming now. But it is not, if it is tied to an offset that won't come due until 2009. Our alternative now before the Senate will do the same thing as the Dodd amendment, but we don't tie it up with an offset that is way down the road 3 years. That is not truth in budgeting. I urge support for my amendment.

Mr. President, I raise a budget point of order on my amendment, and I also move to waive all provisions of the Budget Act and budget resolution necessary for the consideration of the pending amendment to this bill and for the inclusion of the language of the pending amendment in the consideration of amendments between the House and conference report on the bill.

I ask unanimous consent that the motion be agreed to.

I have asked for unanimous consent.

Mr. President, I ask unanimous consent to waive all provisions of the Budget Act and budget resolutions necessary for the consideration of the pending amendment to this bill, and for the inclusion of the language of the pending amendment in the consideration of an amendment between Houses.

Mr. President, first, since we adopted the previous amendment, we obviously don't need this amendment. But even if we consider this amendment, I raise a budget point of order on the amendment.

Just not to confuse anybody, we are kind of going through the same thing we did on the previous two amendments, so be alerted.

I call up amendment No. 2736.

The same arguments that I made on the previous amendments apply here as well. My amendment will do the same as the Reed amendment but doesn't raise taxes to pay for it, so it will provide more equipment for our troops without increasing taxes. I urge support of my amendment.

Mr. President, again I raise a budget point of order. I ask unanimous consent it be exactly the same as the previous one on the last two bills. I ask unanimous consent to waive all provisions of the Budget Act and budget resolutions necessary for the consideration of the pending amendment to this bill and for the inclusion of the language of the pending amendment in the consideration of one amendment between the Houses--an amendment.

Again, I raise a budget point of order on this amendment.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4659) to amend the USA PATRIOT Act to extend the sunset of certain provisions of such Act.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on H.R. 4659 currently under consideration.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in support of H.R. 4659, to extend until March 10 crucial provisions of the PATRIOT Act set to expire this Friday.

On December 23 of last year, both Houses unanimously passed a short- term extension of the PATRIOT Act to preserve critical antiterrorism initiatives that were set to expire at the end of last year. Unfortunately, we must

pass another extension today because a minority of Members of the other body have blocked an up-or-down vote on the conference report for H.R. 3199, the USA PATRIOT and Terrorism Prevention Reauthorization Act of 2005 which the full House passed by a broad bipartisan vote of 257-171 on December 14.

The opponents in the other body have repeatedly cited their concern for civil liberties as a justification for their obstruction. Ironically, the conference report that has been blocked contains dozens of vital civil liberty protections, many included at their request.

The original PATRIOT Act contains none of these protections. As a result, we are once again forced to extend the current PATRIOT Act rather than to implement the current important civil liberties protections contained in the conference report that even its detractors acknowledge is an improvement over current law.

When the PATRIOT Act was first passed in October of 2001, I pledged to rigorously examine its implementation to ensure that new law enforcement authorities did not violate civil liberties. Since April of 2005 alone, the House Judiciary Committee received testimony from 35 witnesses during 12 hearings on the PATRIOT Act. In addition to hearings, I have requested, along with Ranking Member Conyers, written responses from the Attorney General to detailed questions regarding use of the PATRIOT Act and whether any of its provisions have been used to violate individuals' civil liberties.

A chronology of these legislative and oversight activities follows:

Oversight of the USA PATRIOT Act From October, 2001, to November, 2005:

1. November 9, 2005, Department of Justice classified

briefing for Committee on the Judiciary staff on press

accounts of FBI use of NSLs;

2. October 25, 2005, Department of Justice classified

briefing for House & Senate Committees on the Judiciary and

Committees on Intelligence staff on press accounts of FBI use

of NSLs;

3. October 6, 2005, Department of Justice classified

briefing for Committee on the Judiciary Members and staff on

press accounts of mistakes in FBI applications to the Foreign

Intelligence Surveillance Court under the USA PATRIOT Act;

4. July 12, 2005, letter from Assistant Attorney General

William Moschella to the House Committee on the Judiciary

responding to July 1, 2005, letter regarding use of the USA

PATRIOT Act;

5. July 12, 2005, letter from Assistant Attorney General

William Moschella to the House Committee on the Judiciary

responding to May 19, 2005, letter regarding use of the USA

PATRIOT Act;

6. July 11, 2005, letter from Assistant Attorney General

William Moschella to Rep. Bobby Scott responding to questions

regarding use of the USA PATRIOT Act;

7. July 11, 2005, letter from Assistant Attorney General

William Moschella to the House Committee on the Judiciary

regarding use of the USA PATRIOT Act;

8. July 5, 2005, letter from FBI Director Meuller to Senate

Committee on the Judiciary responding to questions regarding

use of the USA PATRIOT Act;

9. July 1, 2005, letter from Assistant Attorney General

William Moschella to Rep. Bobby Scott responding to questions

regarding use of the USA PATRIOT Act;

10. July 1, 2005, letter from House Committee on the

Judiciary to the Attorney General regarding use of the USA

PATRIOT Act; .

11. June 29, 2005, letter from Assistant Attorney General

William Moschella to the Senate Committee on the Judiciary

responding to April 5, 2005, letter regarding use of the USA

PATRIOT Act;

12. June 10, 2005, House Committee on the Judiciary hearing

on reauthorization of the USA PATRIOT Act;

13. June 8, 2005, House Committee on the Judiciary hearing

on reauthorization of the USA PATRIOT Act;

14. May 26, 2005, House Subcommittee on Crime, Terrorism, &

Homeland Security hearing on Material Witness Provisions of

the Criminal Code & the Implementation of the USA PATRIOT

Act; Section 505 that Addresses National Security Letters; &

Section 804 that Addresses Jurisdiction over Crimes Committed

at U.S. Facilities Abroad;

15. May 19, 2005, letter from House Committee on the

Judiciary to the Attorney General regarding use of the USA

PATRIOT Act;

16. May 10, 2005, House Subcommittee on Crime, Terrorism, &

Homeland Security hearing on the prohibition of Material

Support to Terrorists & Foreign Terrorist Organizations & on

the DOJ Inspector General's Reports on Civil Liberty

Violations under the USA PATRIOT Act;

17. May 10, 2005, Senate Committee on the Judiciary hearing

on continued oversight of the USA PATRIOT Act;

18. May 5, 2005, House Subcommittee on Crime, Terrorism, &

Homeland Security hearing on Section 212 of the USA PATRIOT

Act that Allows Emergency Disclosure of Electronic

Communications to Protect Life and Limb;

19. May 3, 2005, House Subcommittee on Crime, Terrorism, &

Homeland Security hearing on Sections 201, 202, 213, & 223 of

the USA PATRIOT Act & Their Effect on Law Enforcement

Surveillance;

20. April 28, 2005, House Subcommittee on Crime, Terrorism,

& Homeland Security hearing: Section 218 of the USA PATRIOT

Act--If It Expires Will the ``Wall'' Return?;

21. April 28, 2005, House Subcommittee on Crime, Terrorism,

& Homeland Security hearing: Have Sections 206 and 215

Improved Foreign Intelligence Surveillance Act (FISA)

Investigations?;

22. April 26, 2005, letter from Assistant Attorney General

William Moschella to Senator Dianne Feinstein responding to

April 4, 2005, letter regarding use of the USA PATRIOT Act;

23. April 26, 2005, House Subcommittee on Crime, Terrorism,

& Homeland Security hearing: Have Sections 204, 207, 214, &

225 of the USA PATRIOT Act, & Sections 6001 & 6002 of the

Intelligence Reform & Terrorism Prevention Act of 2004,

improved FISA Investigations?;

24. April 21, 2005, House Subcommittee on Crime, Terrorism,

& Homeland Security hearing on Crime, Terrorism, & the Age of

Technology--(Section 209: Seizure of Voice-Mail Messages

Pursuant to Warrants; Section 217: Interception of Computer

Trespasser Communications; & Section 220: Nationwide Service

of Search Warrants for Electronic Evidence);

25. April 20, 2005, Senate Subcommittee on Terrorism,

Technology, & Homeland Security hearing: A Review of the

Material Support to Terrorism Prohibition;

26. April 19, 2005, House Subcommittee on Crime, Terrorism,

& Homeland Security hearing on Sections 203(b) and (d) of the

USA PATRIOT Act and their Effect on Information Sharing;

27. April 6, 2005, House Committee on the Judiciary hearing

with Attorney General Gonzales;

28. April 5, 2005, Senate Committee on the Judiciary

hearing on Oversight of the USA PATRIOT Act;

29. March 22, 2005, Department of Justice law enforcement

sensitive briefing for Committee on the Judiciary Members and

staff on the use of FISA under the USA PATRIOT Act;

30. September 22, 2004, Senate Committee on the Judiciary

hearing: A Review of Counter-Terrorism Legislation &

Proposals, Including the USA PATRIOT Act & the SAFE Act May

5, 2004, Senate Committee on the Judiciary hearing: Aiding

Terrorists--a Review of the Material Support Statute;

31. May 20, 2004, Senate Committee on the Judiciary hearing

on FBI Oversight: Terrorism;

32. April 14, 2004, Senate Committee on the Judiciary

hearing on Preventing & Responding to Acts of Terrorism: A

Review of Current Law;

33. February 3, 2004, Department of Justice briefing for

House Committee on the Judiciary staff on its views of S.

1709, the ``Security and Freedom Ensured (SAFE) Act of

2003,'' and H.R. 3352, the House companion bill, as both

bills proposed changes to the USA PATRIOT Act;

34. November 20, 2003, request by Chairmen Sensenbrenner &

Hostettler to GAO requesting a study of the implementation of

the USA PATRIOT Act anti-money laundering provisions. Report

was released on June 6, 2005;

35. October 29, 2003, Department of Justice classified

briefing for Committee on the Judiciary Members & staff on

the use of FlSA under the USA PATRIOT Act;

36. September 10, 2003, Senate Subcommittee on Terrorism,

Technology, & Homeland Security hearing on Terrorism: Two

Years After 9/11, Connecting the Dots;

37. August 7, 2003, Department of Justice briefing for

House Committee on the Judiciary Members and staff regarding

the long-standing authority for law enforcement to conduct

delayed searches & collect business records & the effect of

the USA PATRIOT Act on those authorities;

38. July 23, 2003, Senate Committee on the Judiciary

hearing on Law Enforcement & Terrorism;

39. June 13, 2003, letter from Assistant Secretary for

Legislative Affairs at the Department of Homeland Security,

Pamela J. Turner, to the House Committee on the Judiciary

responding to questions regarding the USA PATRIOT Act;

40. June 10, 2003, Department of Justice classified

briefing for Committee on the Judiciary Members & staff on

the use of FISA under the USA PATRIOT Act;

41. June 5, 2003, House Committee on the Judiciary hearing

on the U.S. Department of Justice, including its use of the

provisions authorized by the USA PATRIOT Act;

42. May 20, 2003, House Subcommittee on the Constitution

hearing: Anti-Terrorism Investigations and the Fourth

Amendment After September 11th: Where and When Can Government

Go to Prevent Terrorist Attacks;

43. May 13, 2003, letter from Acting Assistant Attorney

General, Jamie Brown to the House Committee on the Judiciary

responding to questions regarding the USA PATRIOT Act;

44. April 1, 2003, letter from the House Committee on the

Judiciary to the Attorney General regarding use of the USA

PATRIOT Act;

45. October 9, 2002, Senate Subcommittee on Terrorism,

Technology, & Homeland Security hearing: Tools Against

Terror: How the Administration is Implementing New Laws in

the Fight to Protect our Homeland;

46. September 20, 2002, letter from Assistant Attorney

General, Daniel Bryant, to the House Committee on the

Judiciary responding to questions regarding the USA PATRIOT

Act;

47. September 10, 2002, Senate Committee on the Judiciary

hearing on the USA PATRIOT Act in Practice: Shedding Light on

the FISA Process;

48. August 26, 2002, letter from Assistant Attorney

General, Daniel Bryant, to the House Committee on

the Judiciary responding to questions regarding the USA

PATRIOT Act;

49. July 26, 2002, letter from Assistant Attorney General

Daniel Bryant to the House Committee on the Judiciary

responding to questions regarding the USA PATRIOT Act;

50. July 25, 2002, Senate Committee on the Judiciary

hearing on the Department of Justice, including its

implementation of the authorities granted by the USA PATRIOT

Act;

51. June 13, 2002, letter from the House Committee on the

Judiciary to the Attorney General regarding use of the USA

PATRIOT Act;

52. April 17, 2002, Senate Subcommittee on Administrative

Oversight and the Courts hearing: ``Should the Office of

Homeland Security Have More Power? A Case Study in

Information Sharing;''

53. December 6, 2001, Senate Committee on the Judiciary

hearing on DOJ Oversight: Preserving our Freedoms While

Defending Against Terrorism;

54. December 4, 2001, Senate Committee on the Judiciary

hearing on DOJ Oversight: Preserving our Freedoms While

Defending Against Terrorism;

55. November 28, 2001, Senate Committee on the Judiciary

hearing on DOJ Oversight: Preserving our Freedoms While

Defending Against Terrorism; and

56. October 3, 2001, Senate Subcommittee on the

Constitution, Civil Rights, & Property Rights hearing:

Protecting Constitutional Freedoms in the Face of Terrorism.

The Inspector General has issued six reports and found no evidence that law enforcement has abused the PATRIOT Act. Opponents of the PATRIOT Act have repeatedly pointed to the Brandon Mayfield case as an example of abuse of the act. Members of Congress asked the DOJ Inspector General to examine whether the PATRIOT Act was abused in this case. On January 6, 2006, the Inspector General concluded: ``We do not find any evidence that the FBI misused any of the provisions of the PATRIOT Act in conducting its investigation of Mayfield.''

Even though no credible evidence of abuse of the PATRIOT Act has been received by Congress, the conference report adopted over 30 new additional civil liberty protections to address concerns about the potential for misuse. For example, the conference report contained several new reporting requirements that will provide additional information for congressional oversight of the act. These provisions establish specific procedures to consult legal counsel and seek judicial review for those wishing to challenge the national security letter or a section 215 order, two of the authorities most criticized by opponents.

Additionally, the conference report increases accountability by requiring the FBI director, deputy director, or executive assistant director to authorize applications that request the FISA court to issue a section 215 order for certain records, including library records, medical records, educational record and tax return records. The conference report also requires public reporting of the aggregate use of section 215 orders.

Because time does not permit me to detail all of the civil liberty protections contained in the conference report, the following list details each of those safeguards.

Additional Civil Liberties Protections Contained in the Conference Report on H.R. 3199, the ``USA PATRIOT Improvement and Reauthorization

Act of 2005''

The conference report contains the following additional

safeguards:

Requires a description of a specific target in both the

application and the court order for ``roving wiretaps,'' and

specific facts in the application that show that the target's

actions may thwart surveillance efforts--if the target's true

identity is unknown.

Requires that the FBI must notify the court within 10 days

after beginning surveillance of any new phone for all

``roving wiretaps.'' The notice must include the total number

of electronic surveillances conducted under the court's

multipoint order.

Includes new reporting requirements to Congress, including

new details about the use of ``roving'' authority.

Requires that for delayed notice search warrants that

notice of the search be given within 30 days of its

execution, unless the facts justify a later date, eliminating

the open-ended period of delay permissible under current law.

Allows for extensions of the delay period in giving notice

of a search, but only upon an updated showing of the need for

further delay. Also, it limits any extension to 90 days or

less, unless the facts of the case justify a longer delay.

Adds new reporting requirements to Congress on the use of

delayed notice search warrants.

Requires for section 215 orders, relating to investigator's

access to business records, a statement of facts showing

reasonable grounds to believe that the records or other

things sought are relevant to an authorized investigation to

protect against international terrorism or espionage. This

provides additional safeguards to the original USA PATRIOT

Act, which required the government only to certify that the

records at issue were sought for an authorized

investigation--without any factual showing.

Requires a three part test for section 215 orders that

ensures the records are sought for: a foreign power or an

agent of a foreign power; the activities of a suspected agent

of a foreign power who is the subject of an authorized

investigation; or an individual in contact with, or known to,

a suspected agent of a foreign power who is the subject of an

authorized investigation. This test combined with the newly

required statement of facts should mitigate concerns of

government ``fishing expeditions,'' while maintaining the

flexibility for legitimate terrorism investigations.

Explicitly guarantees the right for recipients of section

215 orders to consult legal counsel and seek judicial review.

Requires high level approval by either the FBI Director,

Deputy Director, or Executive Assistant Director for requests

for certain records, including library records, medical

records, educational records, and tax return records.

Limits the scope of section 215 orders to materials that

could be obtained via grand jury subpoena or a similar court

order for the production of records.

Limits retention, and prohibits dissemination, of

information concerning U.S. persons.

Requires that the DOJ Inspector General conduct two

separate audits of the FBI's use of section 215 orders that

will examine: any noteworthy facts or circumstances relating

to 215 orders, including any improper or illegal use of the

authority; the manner in which such information is collected,

retained, analyzed, and disseminated by the FBI; and an

assessment of whether the minimization procedures protect the

constitutional rights of United States persons.

Requires enhanced reporting to Congress of section 215

orders, including a breakdown of its use to obtain library

records, medical records, educational records, and other

sensitive types of records.

Requires public reporting of the aggregate use of section

215 orders.

Allows recipients of National Security Letters (NSLs) to

consult with legal counsel.

Creates an explicit right to judicial review of NSL

requests.

Permits a reviewing court to modify or set aside an NSL if

compliance would be unreasonable, oppressive, or otherwise

unlawful--this is the same standard used to modify or quash a

subpoena in a criminal case.

Provides for judicial review of the nondisclosure

requirements.

Adds a ``knowing and willfully'' standard that must be

proven before someone who discloses an NSL can be subject to

a 1-year misdemeanor offense.

Requires the DOJ IG to conduct two comprehensive audits of

the FBI's use of NSLs.

Requires the Attorney General and the Director of National

Intelligence to submit to Congress a report on the

feasibility of applying minimization procedures to NSLs to

ensure the protection of constitutional rights of U.S.

persons.

Adds a new ``sunshine'' provision that requires annual

public reporting on NSLs.

Provides for expanded congressional access to significant

FISA reporting currently provided to the Intelligence

Committees.

Includes a provision requiring the FISA Court to submit its

rules and procedures to Congress.

Creates new reporting requirements for the use of emergency

authorities under FISA.

Requires new reporting on the use of emergency disclosures

of communications information made under section 212 of the

USA PATRIOT Act.

Requires the Department of Justice to submit a report to

Congress on the Department's data-mining activities.

I would remind Members, Mr. Speaker, of both Houses that the conference committee dissolved after the conference report was filed and the House acted in a bipartisan manner to approve it. I believe it is healthy to continue to debate the merits of the PATRIOT Act and to continue vigorous congressional oversight of its authorities. But it is also imperative that we not play political games with the vital tools our law enforcement and intelligence communities need to keep us safe from additional attacks on American soil.

We must not rebuild the wall of separation between the FBI and CIA and return to the pre-9/11 mindset that made

America vulnerable to a terrorist attack. I urge my colleagues to join me in supporting this extension of the PATRIOT Act so as to give the other body the time to expeditiously pass the conference report on H.R. 3199. As recent events have highlighted, the threat of terrorism has not receded, nor has the urgency of continued vigilance.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield such time as he may consume to the gentleman from Illinois (Mr. Hyde), my distinguished predecessor as chairman of the Judiciary Committee.

I yield myself the balance of my time.

Mr. Speaker, the two speakers who proposed this brief 5-week extension of the PATRIOT Act are symptomatic of the problems that the opponents of the PATRIOT Act have attempted to tar it with. They are wrong.

First, no Federal court has declared unconstitutional as violative of civil rights any of the 16 provisions of the PATRIOT Act that the sunsets were applied to, none whatsoever.

As I stated in my opening remarks, the Inspector General of the Department of Justice is required by the PATRIOT Act to report on civil rights violations to the two Judiciary Committees twice per year. We have received six of those reports on time, and the number of civil rights violations that have been found by the DOJ Inspector General have been zero.

Furthermore, there is a provision in the PATRIOT Act that anybody whose civil rights have been violated can obtain a statutory judgment of $10,000 in addition to any proven monetary damages against the Justice Department if they are successful in a lawsuit. The Justice Department has not paid out one dime in either monetary or statutory damages under this law.

The PATRIOT Act has nothing to do with NSA wiretaps, and anybody who has been familiar with the operation of the PATRIOT Act knows very, very clearly that it does not have anything to do with NSA wiretaps, and I really wish that the opponents would read the law and stick to the proven testimony of the operation of this act. To say that the Judiciary Committee has not conducted oversight is living in a dream world, and it does not comport with the facts.

Mr. Conyers and I have sent joint oversight letters to the Justice Department and published the nonclassified results of those oversight letters on the committee's website. Last year we had 12 hearings on the PATRIOT Act and the 16 provisions that expire. And guess what? There was no criticism about 14 of the 16 provisions, which the conference report makes permanent. And to say that the 16 provisions that were passed in the PATRIOT Act in October of 2001 were so egregious that sunsets had to be applied really does not talk about what happened then. Every expansion of law enforcement authority contained in the 2001 bill contained a sunset, and we did the oversight, and we found that in 14 of the 16 provisions there was not a problem. And even the witnesses the Democrats brought before the Judiciary Committee said that there was no problem in 14 of the 16 provisions. In the two provisions where there is a sunset in the conference report, there have not been any civil rights violations proven. I have just said that, but one would think that the people's rights were being trampled on. No courts found that, the DOJ Inspector General has not found that, and I really wish that people who do not like the PATRIOT Act would stick to the facts.

Now I would like to talk a little bit about what good the PATRIOT Act has done, and I am going to give credit to Deroy Murdock, who is a New York-based columnist with the Scripps Howard News Service and a senior fellow with the Atlas Economic Research Foundation in Arlington, Virginia. It says: ``Let the Numbers do the Talking.''

First, the total number of individuals who Islamic fanatics murdered on September 11, 2001: 2,977 people whose civil rights were snuffed out because they were murdered;

The cash sum that PATRIOT Act section 371 let Customs agents seize when terror-tied New Jersey imam Alaa al-Sadawi tried to smuggle funds into Egypt in his father's airline luggage: $659,000;

Pounds of heroin the three al Qaeda- and Taliban-linked San Diego weapons dealers offered undercover FBI agents as partial payment for four Stinger anti-aircraft missiles until PATRIOT Act sections 218 and 504 helped authorities unravel their conspiracy: 1,320 pounds of heroin;

Total terror-related defendants captured with the help of PATRIOT Act provisions: 401;

Total terror-related defendants who have pled guilty or who have been convicted with the aid of PATRIOT Act provisions: 212;

Total feet the Brooklyn Bridge would have plunged into the New York City's East River had the PATRIOT Act not helped authorities stop Iyman Faris's

plan to sever the span's cables with acetylene torches: 119. That is New York City.

According to Federal prosecutor Ken Wainstein's January 3 comments after meeting with President Bush, the number of U.S. attorneys who use ``the PATRIOT Act tools each and every day in his or her efforts'': 93, out of 93 U.S. attorneys;

As U.S. Attorney Roslynn Mauskopf notes, total years of prison time earned under the PATRIOT Act by Osama bin Laden's self-proclaimed spiritual adviser, Mohammed al-Moayad, for trying to funnel $20 million to al Qaeda and Hamas: 75;

Number of scholars, former Cabinet members, and other prominent Americans, including Democratic ex-CIA Directors James Woolsey and James Schlesinger, who joined in signing a January 25 open letter advocating the PATRIOT Act's reauthorization: 68;

Years that David Wayne Hull, former Imperial Wizard of the White Knights of the Ku Klux Klan, will spend behind bars after PATRIOT Act section 201 helped convict him for plotting to blow up abortion clinics with hand grenades: 12;

Number of Northern Virginia Islamofascists jailed after the PATRIOT Act's information-sharing provisions let spies and cops jointly determine that they had trained in Afghan and Pakistani terror camps between 1999 and 2001: Eight;

Total al Qaeda associates in Lackawanna, New York who were jailed for 7 to 10 years after the PATRIOT Act finally let cops and intelligence officers sit in the same room to discuss each other's investigations: Six;

According to the Associated Press, the number of tickets for American Airlines Flight 77 that Pentagon-bound 9/11 hijackers Khalid al-Mihdhar and Nawaf al-Hazmi purchased online, using William Patterson University's library computers, that might have been detected had PATRIOT Act section 215 been in place: Two;

The number of the Portland Seven extremists who escaped the PATRIOT Act by being killed by Pakistani troops on October 3, 2003: One.

The number of individuals whom Muslim terrorists have killed on American soil since the adoption of the PATRIOT Act: zero.

Mr. Speaker, this law is working. This law has not violated anybody's civil liberty rights. It has not been held unconstitutional by any Federal court in the country. All of the arguments against the PATRIOT Act are a red herring. It has kept us safer. We ought to continue it. We ought to vote for this bill.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Madam President, we have a few hours left on this side. I believe the Senator from California, Mrs. Boxer, is on her way to the Chamber and will be here momentarily. Until that moment arrives, I suggest the absence of a quorum.

Madam President, several on our side wish to make statements before we get to offer amendments and vote. It is my understanding that it will begin at about 2:15. There will be a series of amendments then offered which, obviously, we will vote on. There are a good number on this side and a few on the other side of the aisle. I encourage Senators to quickly firm up those amendments so we can line things up as expeditiously as we possibly can.

In the meantime, I remind the Senate where we are. We are on the House deficit reduction bill. Later today, I expect that the majority leader will offer a substitute amendment. That will be the Senate amendment; that is a Senate-passed bill to the House bill. The Senate- passed bill will include a perfecting amendment. The perfecting amendment will modify the Senate-passed bill that previously passed in the Senate by extending the so-called tax extenders, R&D tax credit, the WOTC tax credit, tuition reduction, and savers' credit, for an additional year. Those provisions expired at the end of 2005. The Senate bill extended all those provisions, so-called extenders, for 1 more year, until the end of 2006.

The perfecting amendment that will be offered will then add another year to all those, so that those provisions, if that amendment passes, will not expire; they will have 2 more years of life. That is the major change that will be in the perfecting amendment to the Senate substitute, which the majority leader, I assume fairly quickly, will offer.

To remind Senators, the main difference between the House and Senate bill is this: The House bill includes the extension of the lower taxes--the dividend tax and capital gains taxes--for 2 more years. Currently, taxation on dividends and income taxation on capital gains enjoys a lower rate that was put into effect several years ago. That provision or lower rate is in current law and will extend under current law for 2 more years, until the end of 2008, December 31. The House- passed bill extends that provision 2 more years, so it would be in effect for not only 2006, 2007, and 2008, but the House bill would be 2009 and 2010, the full calendar years.

The House-passed bill doesn't, however, include any relief for alternative minimum taxes, which about 17 million Americans will have to pay this year, 2006. Actually, it is about 20 million because 3 million taxpayers had to pay for 2005, and 17 million more taxpayers will have to pay an additional tax under the so-called stealth tax, the alternative minimum tax in 2006. So the House bill extends provisions that need not be extended because the law doesn't change, but it does not reduce taxes for people who are going to pay more for taxes in 2006. Contrast that with the Senate-passed bill, which would be the substitute for the House bill. If it passes, it will send that back over to the House. They, presumably, will disagree with the Senate and ask for a conference. We will appoint conferees and begin a conference on the two separate bills. That will happen next week probably.

Again, the Senate bill doesn't extend dividend reduction, capital gains taxation reduction, for 2 more years. It maintains current law, which provides the current low rate in existence for not only this year but also next year and also the following year, through December 31, 2008. We did, however, in the Senate bill, say, OK, those 17 million people--Americans who are going to have to pay AMT--that is additional tax for 2006--should not have to pay that additional tax. We, in the Senate bill, said we are going to extend the provisions, the so-called AMT patch, so those Americans will not have to pay additional tax under the alternative minimum tax.

That is a major difference between the House and Senate bill. I hope that we in Senate can do what I think most Americans want. Most Americans would say, OK, 17 million Americans--let's not raise their taxes; let's make sure those taxes are not raised. And then we will worry about 2009 and 2010, when we may or may not want to extend more favorable tax treatment on capital gains income and on dividend income. We can cross that bridge when we get there. Because the budget resolution says we cannot lower taxes by more than $7 billion over 5 years, we just can't do it all. We have to make choices. If you add up all the provisions that people want--the tax extenders and other extensions of tax breaks--it is forcing us in the Congress to begin to make a choice as to what is more important: prevent the additional

taxes people have to pay next year under the AMT, or is it more important that they should pay those taxes but, more for the sake of principle than anything else, extend that dividend and capital gains preferential treatment for years 2009 and 2010.

Again, the House bill only addresses 2009 and 2010. Why? Because under current law, capital gains income and dividend income enjoy favorable tax treatment.

That is the basic posture we are in here. It should not take too long. After various amendments are brought up and Senators vote on them, we will send the bill over to the House. The House will probably disagree and request a conference. We will have a conference when we come back next week and finally work out passage of this bill.

I see the Senator from West Virginia is on the floor. I turn to the Senator from West Virginia and yield to him whatever time he desires.

Madam President, if I may ask the Senator from California, how much time does she desire?

I will do this. Why don't I yield to the Senator from Michigan 5 minutes and then the Senator from West Virginia. Is that all right with the Senator from California?

Yes. I think the Senator from West Virginia would like to defer to the Senator from Michigan at this point.

I appreciate the Senator speaking on short notice. Madam President, I yield 5 minutes to the Senator from Michigan.

Madam President, I yield 20 minutes to the Senator from California.

I will then subsequently yield to the Senator from New Jersey.

Madam President, I very much thank the Senator from California for her terrific service to her State and to the Nation.

I yield 10 minutes to the Senator from New Jersey.

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

Mr. President, I am pleased that later today we will be offering a modification to the Senate amendment to provide a 2-year extension and enhancement to the research and development tax credit. Of course, I have filed legislation with my friend, Senator Hatch, to make a permanent commitment to research-intensive businesses in the United States.

This legislation is bipartisan and bicameral. But 2-years is certainly much better than the usual yearly extender. I am already starting to hear from business taxpayers how important a commitment to longer term research projects are, and I agree with them.

I am hopeful that we can prevail upon our House conferees to retain this 2-year incentive.

You know, just the other night, the President spoke of the importance of the R&D credit to maintaining America's competitive edge. He is right, and that is why I have been a strong supporter of legislation to make the credit permanent for the last few Congresses.

Every morning we hear news of some new product or discovery that promises to make our jobs easier or our lives better. Many of these innovations started with a business decision to hire needed researchers and finance the expensive and long process of research and experimentation.

Since 1981, when the R&D tax credit was first enacted, the Federal Government was a partner in that business endeavor because of the potential spillover benefits to society overall from additional research spending.

But the credit has been hobbled over the years because of its temporary nature. As stated in an analysis last year by the Joint Committee on Taxation, ``Perhaps the greatest criticism of the R&D credit among taxpayers regards its temporary nature.''

Joint Tax went on to say, ``A credit of longer duration may more successfully induce additional research than would a temporary credit, even if the temporary credit is periodically renewed.''

I think we should heed the advice of the experts at Joint Tax and renew this credit for as long as we can. That is why I will support a modified Senate proposal later today for a 2-year extension.

Research has shown that a tax credit is a cost-effective way to promote R&D. The General Accounting Office, the Bureau of Labor Statistics, the National Bureau of Economic Research, and others have all found significant evidence that a tax credit stimulates additional domestic R&D spending by U.S. companies.

A report by the Congressional Research Service, CRS, indicates that

economists generally agree that, without Government support, firm investment in R&D would fall short of the socially optimal amount, and thus CRS advocates Government policies to boost private sector R&D.

R&D is linked to broader economic and labor benefits. R&D lays the foundation for technological innovation, which, in turn, is an important driving force in long-term economic growth--mainly through its impact on the productivity of capital and labor. We have many times heard testimony from economists, including Federal Reserve Board Chairman Alan Greenspan, that the reason our economy grew at such breakneck speed during the 1990s stemmed from the productivity growth we realized thanks to technological innovations.

There has been a belief that companies would continue to increase their research spending and that the benefits of these investments on the economy and labor markets would continue without end. Unfortunately, that is not the case.

According to Battelle's 2005 funding forecast, industrial R&D spending will increase only 1.9 percent above last year, to an estimated $191 billion, which is less than the expected rate of inflation of 2.5 percent. For the fifth year in a row, industrial R&D spending growth has been essentially flat.

It is also important to recognize that many of our foreign competitors are offering permanent and generous incentives to firms that attract research dollars to those countries.

A 2001 study by the Organization of Economic Cooperation and Development, OECD, ranked the United States ninth behind other nations in terms of its incentives for business R&D spending. Countries that provide more generous R&D incentives include Spain, Canada, Portugal, Austria, Australia, Netherlands, France, and Korea.

The United Kingdom was added to this list in 2002 when it further expanded its existing R&D incentives program. The continued absence of a long-term U.S. Government R&D policy that encourages U.S.-based R&D will undermine the ability of American companies to remain competitive in U.S. and foreign markets. This disparity could limit U.S. competitiveness relative to its trading partners in the long run.

Also, U.S. workers who are engaged in R&D activities currently benefit from some of the most intellectually stimulating, high-paying, high-skilled jobs in the economy.

My own State of Montana is an excellent example of this economic activity. During the 1990s, about 400 establishments provided high- technology services, at an average wage of about $35,000 per year. These jobs paid nearly 80 percent more than the average private sector wage of less than $20,000 per year during the same year.

Many of these jobs would never have been created without the assistance of the R&D credit.

While there may not be an immediate rush to move all projects and jobs offshore, there has been movement at the margins on those projects that are most cost-sensitive. Once those projects and jobs are gone, it will be many years before companies will have any incentive to bring them back to the United States.

We continue to grapple with the need to stimulate economic growth and advance policies that represent solid long-term investments that will reap benefits for many years to come. I repeatedly have pointed to the R&D tax credit as a measure that gives us a good ``bang for our buck.'' I hope my colleagues will join me in supporting a 2-year extension. It is good for American businesses and workers, and we need it to maintain our global competitive edge.

Mr. President, I take a few moments to talk about the schedule for the rest of the day. The majority leader will be coming to the floor momentarily. Obviously, he will give a better idea of the schedule.

I expect sometime before 11 o'clock this morning the majority leader will come to the floor to offer the Senate substitute in a Grassley- Baucus perfecting amendment. I understand the majority then will fill the amendment tree--that is, offer amendments to fill up the tree-- preventing the offering of amendments this morning. However, Senators on this side of the aisle will be able to offer their amendments. It is just a question of when they can offer amendments.

Later in the day Members can offer amendments. It is the managers' expectation Senators will have used or yielded all time back on the bill at 2:15 and we will begin a series of votes that regularly follow debate time on the reconciliation bill; that is, the so-called vote- arama. Roughly at 2:15 we begin the vote-arama. As Senators offer the amendments, at that point we will vote on the amendments. I am hopeful we will have a couple minutes' time for an explanation as to what the amendments actually are. That is the procedure.

I discussed the order of amendments to be offered with the Democrat leader, and I have discussed the order with the chairman of the Committee on Finance. Shortly, I will announce the plans for the first 10 amendments the Democrat Senators will offer.

Those first 10 amendments in this order are as follows: an amendment by Senator Bingaman on prescription drug implementation; next is an amendment by Senator Menendez, AMT dividends and capital gains, which is germane; third, a Rockefeller amendment on mine safety; fourth, an amendment by Senator Conrad, he will offer the substitute amendment which is fully offset; fifth, an amendment by Senator Kennedy which essentially is the R&D extension for 3 years, and that will be germane; sixth, an amendment by Senator Obama with respect to Katrina child tax credit; next, seventh, an amendment by Senator Cantwell dealing with energy taxes; and No. 8, an amendment by Senator Schumer which is a sense of the Senate on AMT; ninth, an amendment by Senator Harkin with respect to so-called PEP and Pease provisions and dependent care credit; and tenth is an amendment by Senator Landrieu for expansion of the low-income housing tax credit. She wants to expand the tax credit.

There will be other amendments later. I am hopeful the additional Democrat amendments can be 10, 12, 14, but I am not sure. I don't want to prejudge that. These are the first 10. We will indicate what the others will be.

This is our intention of how to proceed. My expectation is the other side of the aisle will offer amendments. We will work with the chairman of the committee and go back and forth at the appropriate time.

That is the general procedure we have in mind. It is not locked in, but that is the general procedure in consultation with the chairman of the committee that we would like to work out. Senators from the other side of the aisle will want to offer their amendments. It will be the managers' intention to alternate between both sides of the aisle. We will seek to obtain copies of amendments and announce information on them as soon as possible.

Obviously, if Senators get information on the amendments to us quickly, the more likely we get the amendments up earlier rather than later.

With those caveats, those are the first 10 amendments we expect to be offered. Pending that, the majority leader is in the Senate. I am sure he wants to make a statement.

I yield the floor.

Mr. President, if it is helpful to all Senators, especially the Senator from Tennessee and the Senator from Nevada, we have a total of about 20 amendments on this side. I don't know how many are on the other side, but I guess maybe we could finish by around 7 o'clock or 8 o'clock tonight. That is a rough estimate. Maybe earlier.

Mr. President, I don't see any Member wishing to speak at this moment.

I suggest the absence of a quorum.

It is my understanding we could start early if Senators have amendments. We do not have to wait a full half hour.

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

Mr. President, I support the pending substitute amendment. I encourage my colleagues to support it as well.

I almost need a flow chart to explain how we got here. But because of several events, there is now more room for tax cuts. Yes, you heard right: more tax cuts.

We should tread carefully, though, rather than dive in. We have an opportunity to show responsibility. And I think that this substitute does just that.

Let me first explain how we got here. As my colleagues will recall, the tax reconciliation bill that we passed last November included much- needed relief for the Gulf States affected by Hurricane Katrina. Congress passed and enacted those incentives separately in December.

Further, our tax bill allocation was limited by the fact that the spending reconciliation bill had not been enacted. The House is expected to pass that bill today, clearing it for the President.

The bottom line is that this bill can accommodate $18 billion more in tax cuts.

We have an opportunity here to show some responsibility. And the responsible thing to do is to pass another year of extenders. Otherwise, we will be right back here in a few months to pass those extenders. Or since it is an election year, we will be back during a lame duck session considering the same set of expiring provisions.

These are very popular, bipartisan tax cuts we extend year after year. But we never have the resources in any given year to make them permanent.

This list of annual extenders includes several proven tax incentives. Businesses are encouraged to do more U.S.-based research and create high-paying jobs. Long-term welfare recipients and others who are hard to employ are given job opportunities through an employer credit. And teachers who reach into their pockets to pay for classroom supplies can get a small deduction for their expenses.

These tax incentives were all part of the original Senate reconciliation bill. But in that bill, they were limited to one year. Now, Chairman Grassley and I are pleased to offer this amended version today to extend these provisions through the end of next year. We will thus provide certainty to businesses, workers, and teachers.

We know we will all vote to extend these provisions, if pressed at the end of the year to do so. We should take this opportunity now to provide these tax incentives through the end of 2007. It is the responsible thing to do. Individual and business taxpayers will be thankful.

Mr. President, before us now are a series of amendments. I have a list of 21 Democratic amendments. I have a list of eight Republican amendments, with promises of more amendments on that side of the aisle, depending upon the course we take today.

Pending a few moments ago, first was an amendment by the majority leader to permanently extend the child tax credit. That is a very popular amendment. I support--I think most of my colleagues do-- extending the child tax credit. I daresay that most Senators on both sides of the aisle would probably strongly support extension of the child tax credit. Senator Talent, the author, however, has expressed his will to convert his amendment to a sense of the Senate. The majority promises to offer the full version later.

Because of the Nation's record on budget deficits, I would prefer that we paid for the pending amendment. But because of the procedural posture in which we find ourselves, we will not have that choice. So we will be faced with an unattractive choice of voting for an appealing tax cut without paying for it or voting against an appealing tax cut.

After this amendment from the other side, we have been promised similar votes on measures to extend marriage penalty relief, estate tax relief, Social Security tax relief, 10 percent tax bracket relief, and so on. At the end of

the day, this could become a fiscally very irresponsible exercise.

I wish to propose a different path. I propose that we address a limited number of amendments--just six--and then go to third reading. I propose that these six amendments be Senator Talent's sense of the Senate on the child tax credit, Senator Bingaman's prescription drug benefit, a Republican alternative to the prescription drug amendment, a modified Schumer-Menendez-Grassley sense of the Senate on AMT relief, a modified Rockefeller-Santorum mine safety amendment, and a paid-for substitute by Senator Conrad, and then go to third reading.

The Republican manager has conveyed to me that he would find this procedure acceptable. This procedure would require, obviously, many Senators to forgo their opportunity to offer amendments. That is clear. It would have that consequence. But this procedure would also do the most to maintain fiscal responsibility. This procedure would also allow Senators to get back to their States and their constituents in much shorter order.

I implore my colleagues, let us choose the path of reason. Let us choose the path of moderation. Let us end this bill this afternoon.

I have given deep thought to this issue. I know there are many on both sides of the aisle who have conflicting emotions and views on this basic prospect we find ourselves facing. It is my considered judgment that the path I am outlining is probably the best course for the Senate and, more importantly, the best course for the Nation. After all, we are here representing our constituents. We should go the extra mile to do whatever we possibly can to represent the people back in our home States as well as we possibly can.

On behalf of Senators Byrd, Rockefeller, and Santorum, I send an amendment to the desk and ask for its immediate consideration.

Mr. President, I believe we have 1 minute each. I yield 1 minute to the Senator from West Virginia.

Mr. President, the next amendment on the list is to be offered by the Senator from North Dakota, Mr. Conrad. He should be here at any moment now. Until he is here, I suggest the absence of a quorum.

It is.

Amendment No. 2729 to Amendment No. 2707

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Mr. President, we are making a lot of progress. I think if we just keep operating in the sense of comity we can do quite well. In that spirit, I ask unanimous consent the Grassley AMT amendment and the Mendendez AMT amendment be moved down the amendment list in the time of offering.

That means the next amendment is the amendment of Senator Grassley on the Medicare prescription drug program.

Mr. President, what is the regular order?

Mr. President, I yield 1 minute allocated to my side to the Senator from Florida.

Mr. President, I yield the 1 minute allocated to our side to the Senator from Connecticut.

Mr. President, the Senate is not in order.

I yield 1 minute to the Senator from Rhode Island.

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

My friend from Iowa came to the floor to speak a bit this morning on a couple of subjects I spoke about yesterday. Let me again say I have very high regard for Senator Grassley. We worked together on a good number of issues. I enjoy working with him. But there are times when you have disagreements on policy, and we certainly have that on an issue I am going to talk about. It is an issue he talked about this morning as well. Actually, there are a couple of tax issues.

Before I do, however, I want to just make a slight correction to the remarks that were made by the Senator from Pennsylvania a few minutes ago. I heard him say the Democrats were holding up this bill on, I guess--I think he said a technicality. I think he said it was a technicality. I think that was the impression he intended to leave, obstruct or holding this up on a technicality.

I guess the technicality is our interest in offering amendments. I know to some that is not a pleasant thing around here, to have people offer amendments and actually debate them and vote on them, but that is the way the system works. The reason there are not amendments offered-- and I would try to offer one right now, but I would be unable to offer one--is because the majority party has done something that is called filling the tree. It is a parliamentary procedure to make sure every branch of this legislative tree is filled so that no one is allowed to offer an amendment.

For example, while this bill is on the floor, under the rules of the Senate, I should be able to offer an amendment. The majority party decided to fill the tree, as it is called, so no one on this side may offer an amendment. So when my colleague from Pennsylvania said the Democratic side of the aisle is using a technicality--whatever, I forget his term exactly--to hold this up, I am sorry that is not what is happening at all.

He made a point that I share. I think it would be great to work together. I think there ought to be less rancid partisanship and we ought to find ways to work together to do the Nation's business. We, after all, represent the same interests. We represent the interests of this country. I hope we represent the interests of the American people. I would like to find areas where we can work together.

In this case, however, let me just say there is no obstruction going on here. The only obstruction is we are obstructed from being able to offer an amendment which in ordinary circumstances the rules of the Senate would permit. I regret that. I wish the majority party would have allowed me. I would have offered the amendment yesterday, in fact, and I would offer it right now. I have an amendment to offer. I guess we will vote on it later because you will have to have a circumstance where we can offer the amendment. I suppose the purpose is to allow amendments to be offered when all time is expired so there is no debate that is allowed. I guess that is probably the purpose. But I did want to disabuse anyone of the notion left by my colleague from Pennsylvania that somehow it is this side that is hanging all of this up.

It may be inconvenient to have people offer amendments in the Senate, but there are a couple of hundred years of tradition of this inconvenience. The inconvenience is to be able to offer ideas, debate the ideas in the form of an amendment, and then have a vote, and the vote determines whether the idea that is offered represents public policy that the full Senate will accept.

Let me just respond to a couple of things my distinguished colleague from Iowa has said. Yesterday, I gave a presentation talking about something called deferral. I know most of these things sound like foreign language around here. Deferral of income tax obligations is what it is. If a company does business overseas, an American company does business overseas and earns income overseas, at some point when it brings those profits, that income back to our country, they will be required to pay an income tax to our country for the income they have earned. They will get a credit, actually, against taxes they paid to a foreign country so they will not be double-taxed. But when they repatriate that income, as it is called, they have to pay a tax.

My colleagues in the Congress, a sufficient number of colleagues who represent the majority, decided that they wanted to have a kind of little sweetheart deal for companies that would repatriate their earnings because many companies park their earnings for a long while overseas and don't bring them back. When they bring them back they have to pay the full tax rate. My colleagues said: Let's create new jobs in America by allowing these companies to bring their income back, and we will give them a special superdeal.

You have heard of blue light specials; this is the blue light special of all specials. It says you bring that money back from overseas, you get to pay not 35 percent, not 30 percent, not 25 percent, not 15 percent or 10 percent--which is the lowest income tax rate that is paid by the lowest income earner who has to pay income taxes--you get to pay a 5.25-income-tax rate. Who is the ``you''? The biggest companies in our country: Ford Motor, for one thing. I mention that because when they announced they are going to lay off 30,000, they also said: By the way, we picked up a quarter of a billion dollars of tax refunds under the Jobs Creation Act. Isn't that interesting? Ford Motor said in the same press release: We are going to lay off 30,000 workers in this country and, by the way, we were able to get a quarter of a billion dollars, a $250 million benefit from the jobs creation tax rate special benefit of 5.25 percent.

The whole purpose was to create jobs in our country and, at least in the most recent job announcement of 30,000 jobs lost, the very company that announces 30,000 jobs gone points out they got a quarter of billion dollars under this provision.

My colleagues seem to suggest the provision really does work, it is helpful. No, it doesn't work. It didn't work. By my calculation, the income that was parked overseas and at some point would have had to have been repatriated to this country, that income would have borne a tax that is about $104 billion more than what was paid under the 5.25 percent.

Is anybody going to have to answer to that? I don't know. Maybe not. Maybe nobody cares--$104 billion. You could reduce the Federal debt, reduce the annual budget deficit. You could probably provide some health care to people who do not have it, perhaps help some kids who are hungry, perhaps provide health care for kids who are sick, improve some classrooms in schools that need improvement--maybe there is a lot of things you could do. But $104 billion, that is a tax break given to the biggest corporations in this country who brought income back to our country and would have had to pay normal income tax rates but were told by this Congress that we are going to give you a superspecial deal that no other American taxpayer has: 5.25 income tax rate.

Wouldn't every American love to pay a 5.25 income tax rate? But they can't. That deal is just reserved by the Congress for some bigger interests.

I didn't vote for that. I didn't support it. I strongly opposed it. My colleague who sat in this chair right here, Senator Fritz Hollings, who is now retired, offered the amendment to strip that out, but we were not successful. So this blue light special, 5.25 percent special income tax rate for big interests who were bringing money back from overseas--it got done and $104 billion, as I calculate it, was saved by those who otherwise would have had to pay regular income tax rates.

I wanted to respond to that because I still think that was one of the goofiest ideas in the world for this Congress to embrace, saying let's provide a 5.25 tax rate because we think it will create jobs. The evidence is all around us. It didn't create jobs. In fact, I have charts saying the largest companies that got some of the biggest benefits--one company got a $14.5 million benefit and laid off 14,500 people--almost complete

and perfect symmetry, wasn't it? Except they were supposed to have hired people if they got this kind of special tax rate. They just forgot and laid them off, I guess.

Let me go to the other point which is what persuaded my colleague to come to the floor and engage on this issue, and that was the point I made yesterday. We have a provision in our Tax Code that says to someone in Iowa or North Dakota or Colorado or Pennsylvania, if you have a manufacturing plant and you are across the street from your competitor and your competitor has a manufacturing plant and you produce exactly the same products but you do something different, you move your jobs to China and manufacture your widgets in China, your competitor across the street stays home and manufactures them here in this country--one thing has happened as a result of that move. We have embedded in this Tax Code a perverse incentive that says: By the way, we will give you a break. You move those jobs to China, close your plant door, get rid of your workers, produce in China, and we will give you a tax break. You are not going to pay as much in income taxes as your competitor across the street who stayed in this country.

I think that is wrong. Going all the way back to 1961 with John F. Kennedy, proposals have existed to change it. Going back to 1987, the House actually passed legislation to change it. But we can't change it any longer because now, of course, the big economic interests that benefit a lot from that--and we have a lot of companies getting rid of American workers, padlocking their doors and shipping the jobs to China. I have spoken about many of them on the floor of the Senate. We have a lot of companies that like this tax break. Why? They like to hire people for 33 cents an hour, produce the product in China, sell it in Cincinnati or Toledo or Pittsburgh, and then run their income through the Grand Cayman Islands, through the Ugland House on Church Street on the island of Grand Cayman, that houses 12,748. It is just an address, of course, but the purpose is to reduce the tax burden.

My point is on four occasions when I offered amendments on the floor of the Senate so we ought to at least decide as a country that we will not provide financial incentives in the Tax Code for those who decide to move their jobs overseas--that ought to be the least we ought to do. That ought to be the baby step in the right direction--but four times we have voted and on four occasions those big interests that really like this and have benefits from it have been able to persuade a majority of the Senate to oppose closing that loophole.

I indicated yesterday I would once again offer that legislation. I would offer it right this moment except I am prevented because the majority has done what is called filled the tree and prevented anybody from offering any amendments. My colleague from Iowa came down this morning and offered what I believe is called the Banana defense. That is what he called it the last time he offered it. It had to do something with bananas.

I don't know, maybe we could debate apricots or tailpipes or bananas. It doesn't matter to me what the product is. We could have a long debate about it. I will just call this the banana debate then. But whatever the product or circumstances, the question remains: Do you believe that our Tax Code ought to provide financial benefits and rewards to companies that have decided to move their jobs overseas? Should Huffy bicycle have gotten a reward for firing all their workers and producing Huffy bicycles in China? Should Radio Flyer little red wagon have gotten a benefit from moving all their jobs overseas? Fruit of the Loom, should they have gotten the benefit?

I could go on at some length. Fig Newton cookies, when they went to Monterrey, Mexico, should they get a benefit? If you think yes, then good for you, and I suppose the benefit will continue to exist in our Tax Code, but we are going to continue to vote on it. I am not deterred. As far as I am concerned we can vote 10 times on it. At some point there will be enough people filling the seats in this Chamber to understand that at a time that we have a crisis, and it is a crisis with substantial numbers of jobs moving outside of this country in search of lower labor costs to produce products to ship back into this country, at a time when we have that kind of crisis and the American people are facing downward pressure on wages, they are facing the stripping away of their pensions, the loss of their health care--at a time when we have that kind of crisis, the question is: Will there be enough people filling the seats in this Chamber to stand up and say let's take the first baby step in addressing it?

The first baby step is to say: Let's not provide incentives in the Tax Code for companies to move those jobs overseas. If we can't do that, we can't solve this problem. But we will have plenty of chances. We will have one more chance now. We had four chances previously.

I respect everybody's ability and interest to vote however they choose in this Chamber. I don't demean their reputation nor diminish their capability. I only say that I feel very strongly that if they support this provision, they are wrong. They are wrong for this country. The right public policy position is at least to have some basic neutrality on the question of whether we want to export jobs and whether we want to have the financial incentives for exporting jobs in our Tax Code.

I regret that we don't have a back and forth. I would love to have a real debate about this because I know there are those who benefit handsomely from this who want to continue it and want it to remain in the Tax Code. But I feel strongly that this provision that is known as deferral--and, incidentally, my repeal of deferral does not go to the John F. Kennedy proposal on repealing deferral. My repeal on deferral is rather narrow. It is those companies that leave this country and ship back into this country.

I think it is a perfectly appropriate thing, especially now given the crisis we face with jobs and opportunities in this country, for us to do that.

I have a right, under the procedures of the Senate, to offer this amendment. I should have the right to offer it at the moment but I am not because there is--I guess the word ``obstruction'' is to be used-- obstruction at the moment is the tree is filled so that no one can offer an amendment. So we are going into some process that is a vote- arama, and I will offer the amendment, and we will have a vote.

Let me finally say it again.

There is not one Member of the Senate that puts on a dark suit every morning and comes to work here that has ever been threatened to have their job outsourced--not one. There is not a person here that is ever going to have their job outsourced. Maybe they do not think much about it. I don't know. We have all of these people in blue suits who come here every day and we talk and we talk, and mostly we talk. We are good at talking.

But the question for most Americans who worry about their jobs and who see their neighbors' jobs moved overseas is, Will their jobs be moved? The question for them is, Will Congress do something about it?

I mentioned a few moments ago the Ugland House in the Grand Cayman Islands, which is a slightly different approach than the Tax Code I have been describing.

I wanted to mention that there is a man from Bloomberg News named David Evans who has done some reporting on this Ugland House. The Ugland House is a house on Church Street in the Cayman Islands. It was, according to news reports, dug out by David Evans, who has done the research. This is a five-story white building that houses 12,748 companies. It doesn't really house 12,748 companies--it is an address. This is a five-story white house address on Church Street in the Cayman Islands. Why would 12,000 companies congregate to have an address in this five-story building? There is only one reason. And, by the way, every one of them are represented by the same law firm. Why? So they don't have to pay taxes, that is why.

They want to access cheap labor in Asia, sell in America, and run it through the Cayman Islands so they don't pay taxes.

That is what this is all about.

Because we have a tax bill on the floor of the Senate, I have another amendment that I will not be offering now for those companies that want to congregate at an address in a tax-haven country, the Cayman Islands. But if you are creating an address to

have a tax haven and avoid taxes, you shall be treated for tax purposes as if you have never left our country. You don't get to claim that you now have an address in the Ugland House, and, therefore, you are running your income through that house. My legislation would say you are going to be treated as if you never left for business purposes.

We can shut that down like that, if Members of Congress have the interest and the will.

Does anybody believe this is anything other than a huge scam, by having a little five-story house with 12,000 businesses congregate there under the umbrella of a law firm that runs their mail through that place in order to avoid paying U.S. taxes?

Thanks to David Evans for the work he has done. But in many ways, I think this is the tip of the iceberg. There is substantial tax avoidance going on. Some of it is legal. The first description I made today was the description of the avoidance of what I think is about $104 billion in taxes under the 5.25-percent special tax deal.

The other one I mentioned, deferral for those who move their jobs overseas, that is in law. I am not criticizing companies for following the law. I am criticizing the Congress for not changing the law and doing what we should do--stand up for American jobs.

I was thinking I had actually done plenty yesterday to either aid or injure my cause, however one views these issues. But when I heard my colleague from Iowa come to the floor today, I at least wanted to respond to that. As I was coming over, I heard my colleague from Pennsylvania say someone else was obstructing, I guess, the work of the Congress over what I think is a technicality, and the technicality was we wanted to offer amendments.

I say to my colleague, there is never a technicality when someone wants to offer an amendment. If the rules allow us to offer amendments, just have the amendments, have a little debate, vote regular order, and let it go. When it is done and the dust is settled, we decide what we decide, and everybody is responsible for the vote they cast.

My colleague from Pennsylvania said he wished we would be a little less partisan. So do I. I think we need to find ways to make this a little less partisan. A good step in that direction would be, for example, for somebody to right now come out and say: We have a bill on the floor, let us have regular order. If amendments are, by the way, allowed, let us go ahead and offer them. Will you give us a time agreement? Sure. Vote, act the way legislators should act, and at the end of the day, we will all feel better about that.

That is what the Senate ought to be about when we call this the greatest deliberative body in the world. It has slipped a bit. We can regain that status if we only decide amendments are good and not bad things. Debate is good--not bad. The noise of democracy coming from the Senate is welcome noise for the American people, if we are engaged in constructive debate about issues that matter.

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

Mr. President, it is sort of with mixed emotions that I am

here on the floor to talk about this tax bill. In one sense, I am very happy we are moving forward with the Tax Increase Protection Act. At the same time, I am at somewhat of a loss as to why we are spending 2, 3, and maybe more days of the Senate's time for something that is traditionally done when there is comity and cooperativeness in the Senate by unanimous consent, putting in a substitute Senate-passed bill for the House bill and go to conference. That is something we do routinely here, almost daily. We have disagreements with the House, and we simply go through the procedure of moving to conference and having those differences worked out.

Unfortunately, we are at a time here where even routine things become weeklong labors to accomplish them. That does not reflect well on the Senate. I don't believe it accomplishes anything other than to delay other matters that are to come before the Senate.

We have a very important bill dealing with an issue that is of vital importance to my State--many manufacturing jobs in my State--and that is the asbestos debacle going on throughout the courts in this country where over half of the money paid out by corporations in asbestos claims has gone to lawyers. There are many people in the Commonwealth of Pennsylvania who are literally getting pennies--people who are sick and some are dying and some have died, and they have received literally pennies for their exposure to asbestos and their subsequent disease because of the horrific environment of litigation on asbestos, where lawyers are profiting and patients--those who are sick or are survivors of those who have gotten ill and died--get virtually nothing. This is something we have to address.

Instead of addressing that, which is what we should be doing right now, we are holding up the Senate on a procedural matter. It is truly sad that we can no longer just cooperate on the normal business. Everything is obstruction and slowdown and political potshots and making points. I think that is unfortunate for this body. It sets a very dangerous precedent that we are going to conduct business like this in the future. Whether it is in the next election or elections in the future, at some point in time, the tables will turn. I believe what we are establishing today is not something that will be beneficial for the long term in our ability to get things done in the Senate.

While the chairman is still on the Senate floor, I thank him again. I am repeating this because we are doing the same bill. I thank him for all the hard work he has put into this bill. The fact that he was able to get a bipartisan bill through the Senate is a testament to him, and I know it is very difficult and trying, negotiating within our own conference as well as negotiating with Members on the other side of the aisle. He was able to, as he has done on many occasions, cut through all of the difficulty and partisanship and the angst some Members have about various provisions and find a good middle ground, and well over 60 Members of the Senate supported the Senate bill that passed in November. I thank him for his good work and for the work he has done with me, in particular, on the issue of helping the nonprofit sector in our society meet the needs of those.

We were at the prayer breakfast this morning, and Senator Grassley was there. We heard Bono and the President talk about taking care of the least of our brothers and sisters. The President says it so well. I have been advocating so long that nobody really does it better than our faith-based communities and our community nonprofits. They are the ones on the front line. We talked about it at the prayer breakfast--whether it is responding to a natural disaster or, more often and less prominently, responding to a person in need in our communities across America, rich as well as poor, people in need who are suffering.

It is important that we recognize that portion of this bill has to be a net plus for our charitable community. There are provisions in there that I have expressed concerns about which would do damage to those nonprofits' ability to be able to provide the needed services and to do the good works in our communities that make America stronger.

We have some good charitable-giving incentives, which are a big plus, but we also have charitable reforms on which I worked with the chairman. I think that maybe we are 90 percent of the way there, making sure we weed out some bad practices and making sure there isn't abuse within the charitable field, but at the same time not saddling our charities with a Sarbanes-Oxley type of oversight and regulations that would drive a lot of our small volunteer-oriented nonprofits out of existence and leave a big hole in our communities across America.

I am hopeful that when we get to the House and into conference, Chairman Thomas will work with us and we will be able to get a bill that will be not only a net plus but a big plus for the armies of compassion, the foot soldiers across America who are helping men and women in need and children in need in our society.

A big part of this bill, obviously, is the tax relief. It is not exactly what I had hoped for. It is one of those compromises we had to make along the way. I thought the House bill actually had some better provisions when it comes to some of the tax provisions. It continues on a policy that has resulted in a lot of positive economic news over the past several years since 2003. We have seen that by these changes in the Tax Code and reducing marginal rates and capital gains taxes and dividends, it has incentivized the entrepreneurial spirit and incentivized business investment; it has created an explosion of growth in this country, which has also resulted in millions of people getting jobs--net new jobs across America.

I have a chart that shows, since the Jobs and Growth Act of May of 2003, and looking at the real GDP growth in America, there is a dramatic tilting upward since these provisions were passed. That has resulted in a dramatic increase, as we have seen on some other charts, in Federal revenues.

There is a constant complaint, a drumbeat on the other side of the aisle, and from a few on this side of the aisle, that somehow we cannot afford these tax reductions.

It is interesting; if you think of tax reductions, that leaves the question, What is a tax reduction? What is a tax reduction? Is a tax reduction a reduction in the taxes paid; or is it a reduction in the rate of the tax paid? What is a tax reduction?

Depending on how you view a tax reduction--and the answer is different based on what we did--if you look at, Did we reduce taxes, the answer is, with respect to rates, yes, we reduced taxes; we reduced the capital gains dividend rates, the marginal tax rates. We reduced the rates on the taxation of married couples and in several other areas. So, yes, we reduced the rate of tax.

The question is, Did we reduce the collection of taxes? What should Congress be more concerned about? Should we be more concerned about the rates of taxes or should we be more concerned about the collection of tax revenues?

I would think most people, when we have cut taxes, would say we reduced the collection of taxes in America. That is not what happened. When we reduced the rate of taxes, when we cut taxes, we actually didn't cut taxes. We actually increased the flow of revenue to the Federal Government.

So if we are looking at it from the standpoint of the budgeteers, the folks who are responsible for managing the receipts and distributions of Government, then the actions taken by the Congress in 2001 and 2003 resulted in increased taxes paid to the Federal Government through a policy that believes in the innovation and the energy of the people, that if you unshackle them from higher tax rates, they will produce more, they will create more jobs--and job growth has been terrific, over 2 million jobs, and the unemployment rate has been under 5 percent--and we end up with a better quality of life, more revenue to the Federal Government, and higher growth rates overall in our economy.

That is a pretty good picture. So why the complaints? Why are people so upset that we actually put a program in place that has resulted in more revenues coming to the Federal Government? Why the complaints? Why the gnashing of teeth that somehow this is a policy that is harmful to the budget deficit? Revenues were up 14 percent last year. How is that harmful to the budget deficit?

They say: That would have happened; in fact, we would have gotten more money had we not reduced taxes. Is that true? Let's look at the capital gains issue.

The Congressional Budget Office estimated in 2003 that we would collect roughly $125 billion in the year 2004 and 2005 in capital gains taxes. We went ahead and reduced the capital gains tax rate. Many of us stood on the floor and said, by reducing that rate, we will actually get more revenues. The Congressional Budget Office said ``no,'' everybody on the other side said ``no,'' and, in fact, everybody on the other side still said ``no'' and still says we shouldn't keep those rates low, we have to increase those rates because we need the money.

How did it work out? What happened when we reduced those rates? Did we get, as the Congressional Budget Office suggested, $26 billion less money? And that is what they projected. They projected in 2004 and 2005 that the amount of money coming into the Treasury in capital gains taxes paid would go down by $26 billion. What happened? Now we know. The amount of revenue collected in capital gains taxes went up $27 billion.

I was talking to a reporter the other day. I said: Lo and behold, I voted for a tax increase and didn't even know it. I voted for a provision that actually increased taxes to the Federal Government, and the folks who paid those taxes were very happy to pay them, by the way, because they were investing in America and America's values were increasing. Stock in America, real estate in America, the things that made wealth in America were increasing because of a growing economy because of what we did on the floor of the Senate, and they were very happy to have paid those taxes. And we got more Federal revenues.

What does the other side want to do? They want to have that rate go back up. One might suggest that if the rate goes back up, revenues could do down. What could be their motivation? What is the motivation of trying to increase a tax to get less revenue? Think about it. What could be the possible motivation of coming to the floor of the Senate and saying we need to increase taxes, even though by doing so we are going to get less money. Why would you do that? From a public policy perspective, why would you want to do that?

I can tell you that the argument is given that we need it to balance the budget. Wait a minute. We are going to get less money, so why would you do it? Could it be something of the whole politics of envy, the politics of pointing the finger at those who are successful, get a paycheck, and invest in America and say we need to tax them more; that is the fairness issue? We hear that a lot on the floor of the Senate: It is about fairness. That is what it is about? Stick it to those who succeeded, invested, purchased real estate, purchased stocks and bonds; we are going to take a bigger chunk of their money because that is fair. We may get less revenue, we may get slower economic growth, fewer jobs will be created, but we will feel better.

That is not sound public policy. That is not in the best interest of the American people. We did not get in the Senate bill a reduction of capital gains tax rate extension for 2 more years, but I will tell you that we will work very hard in the conference to make sure that happens. It is important for the economic growth of our country, for the job creation in our country, and for Federal revenues that we get that extension in law.

There are a lot of games being played on the floor of the Senate when it comes to tax policy and the politics of envy. What we should be focused on is how does this Senate, how does this Government create the best environment for growth opportunity and job creation and how do we do it in a way that is fiscally responsible. Those are the two things on which we should be focusing.

I would make the argument that the bill before us, which prevents an increase in taxes--these are tax policies that are in place right now; there is no new policy or, I should say, very minor, little new policy changes, such as the charitable giving incentives, but very small policy changes, a very small percentage of the money. The overall bill deals with provisions such as the alternative minimum tax, which is vitally important and the small saver's credit, which is important. About a quarter of a million people in my State strongly support that provision, in fact, would strongly support increased incentives for low-income individuals to save and, in fact, put forth a bill with former Senator Corzine to do that. So I am looking for another new cosponsor if anybody wants to join. It is called a kid's account to give every child in America a nest egg to begin to save at their birth.

I am big on giving people the opportunity to save, invest, build wealth, and feel connected to the economy of this country. We need to do more of that. But we have a little piece of that here, which is important to the people in my State. Mr. President, 150,000 families and students in my State will lose their deduction for college tuition if we don't extend that provision. With regard to the teacher tax credit provision Senator Collins championed, 142,000 teachers in Pennsylvania will not be able to deduct that. We can go on and on.

These are preventions of tax increases, a tax reduction that caused the kind of economic growth we have seen. It is important for us to have these provisions stay in law.

Finally, I want to talk about an issue that has been brought up--and it is an important issue--and that is the issue of mine safety. I know Senator Rockefeller has put forth an idea that I think deserves some consideration because it has merit. It provides mining companies with incentives to make available newer technology that will enhance safety.

We have seen over the last month in West Virginia and we saw, I guess, 3 years ago in Pennsylvania, mine disasters occur where human life was lost, in the cases of West Virginia, and certainly a major disaster was diverted in Quecreek in Pennsylvania.

This is a serious issue, one I care deeply about. My grandfather was a coal miner in a deep mine for 30 years, so this is very close to home for me. This is one issue we need to do something about, to improve the safety for those who literally risk their lives every day to provide for their families, to build strong communities, and to provide energy for all of us so these lights will work in the Chamber. We need to do all we can to improve enforcement as well as to create incentives for the mining community to improve safety at the workplace.

There is another provision in the Rockefeller bill that has to do with training for rescue teams. Because of the way it is written, I have some concerns about it. I heard from a lot of our small mining operations, family-run operations, that this provision would not benefit them at all.

As we know, a large percentage--at least in my State--a large percentage of the mine operations in my State are not big corporate mining operations. They are small, in some cases small corporations, family-run operations. So while I certainly strongly support the first provision and support the concept behind the second provision, I have serious concerns about the way that provision will tilt to the benefit of the larger mining operations.

While I support it and will support this amendment, I hope it is included and that we can work on something in conference to include improvement of mine safety, I am putting my marker down here that we will do so not to discriminate against small mines versus larger mining operations. If anything--if anything--we should be concerned about, as we do on a lot of issues in the Senate, helping the little guy, as opposed to helping the big guy because the big guys already have the resources to spend to provide for a safer workplace.

What we should be doing is focusing on how we can make smaller mining operations safer. That is not what this amendment that Senator Rockefeller puts forward does. As a result of that, while I support it and will support the provision to be included in the conference, I put the marker down that we are going to work diligently to make sure it uniformly impacts across the industry and, if anything, it benefits the smaller mine operator as opposed to the bigger one. That is not the way it is currently drafted.

I completely understand. I don't think Senator Rockefeller--at least