Kendell Frederick Citizenship Assistance Act

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, 10 days ago, I returned home from a bipartisan, bicameral congressional factfinding mission that took a number of Members, including Senator Chuck Hagel of Nebraska, myself, and Congresswoman Ellen Tauscher from California, to a number of Middle Eastern countries. There we met with, among others, the leaders of Israel, the Palestinian Authority, Jordan, Saudi Arabia, and Iraq, as well as with our own civilian and military leaders. For me, our visit was informative, highly informative, even illuminating, and provided me with a number of insights that I wish to share today with my colleagues and with the American people.

For the past several months, Americans have become increasingly skeptical about our ongoing military presence in Iraq, leading to a fierce debate on how to succeed in Iraq and when to begin to redeploy American troops. With so much discord at home, I was surprised and, frankly, heartened to learn during our mission that there is a growing consensus among both U.S. and Iraqi civilian and military officials on a reasonable path forward that I believe many Americans can embrace.

As our President acknowledged somewhat belatedly today, a number of

grievous mistakes were made during his administration following the ouster of Saddam Hussein--for example, literally telling the Iraqi army to go home, you are disbanded, not needed anymore. Having said that, there is a whole lot at stake, too much at stake, for us to just cut and run. But somewhere between withdrawing all U.S. forces within 6 months and staying the course is a commonsense policy and a path forward for the United States, for Iraq, and for its Arab neighbors.

I believe tomorrow's parliamentary elections and the likely emergence of a coalition government in Iraq gives us a great opportunity, not so much to stay the course but to begin to alter it. This altered course would provide for a moderate but significant redeployment of U.S. troops from Iraq beginning early next year. It could start with our National Guard men and women, might start with our Reserve Forces. We might bring some of them home. Some of them we may wish to deploy to a place such as Afghanistan where they probably would be needed.

Redeployment or drawdown is, maybe, a good beginning, but by no means does it end there. We must also redouble our effort to enlist the full cooperation of the Arab League and others to stabilize Iraq politically and economically as we continue to help Iraq militarily and their police force shoulder more of the burden in providing security in their country.

On the sensitive issue of withdrawing U.S. troops, I believe if we were to withdraw all of our military forces within the next 6 or even 12 months, we would leave that country in danger of a civil war, and America and Iraq's neighbors would be less safe, not more safe, than they were before we invaded Iraq. The truth is, though, a modest American force may well be needed in Iraq for some time. While it will not be close to the 160,000 or so troops we have there now, America will likely maintain some kind of military presence in Iraq, if the Iraqis want us to, just as we currently do in Afghanistan and Kosovo and several other places around the world.

The President's open-ended statements, however well intentioned, about staying the course cause many Iraqis to question our Nation's true intentions. More and more, Iraqis view our troops as occupiers, not liberators. To a lot of them, the President's rhetoric is code for ``We are here for your oil, and we are going to stay until we get it.'' That is an interpretation that fuels the very insurgency we are trying to defeat.

That is why it makes sense to me to announce as early as January that we plan to redeploy a significant number of American troops from Iraq in 2006 and then begin to do so shortly thereafter. Taking this step will help make clearer to most Iraqis our desire ultimately to leave Iraq and its natural resources where they belong--in the hands of Iraqis.

These views are not mine alone. They reflect the views of Iraq's civilian and military leaders as well as those of top American officials on the ground. We should listen to them. In the words of one of our top American military commanders, he said, pointing toward the door of the room in which we were meeting, it is time for us to begin moving toward the door. And I believe he is right. Otherwise, I fear our troops, who continue to perform courageously under incredibly difficult circumstances, will remain targets of opportunity for months or even years to come.

Although much of the debate in America has focused on withdrawing troops, if all we do by the end of next year is reduce our troop levels, we will not set Iraqis up for success; we will set them up for failure. There is also a political war to win, and it is not going to be easy. I believe America's Ambassador to Iraq, the gifted Zal Khalilzad, has done a remarkable job this year in narrowing the differences among competing factions in Iraq. Now it looks like tomorrow's turnout for the parliamentary elections will be strong, even among minority Sunnis, and result in the need to form a coalition government.

In fact, when we were there, we heard that the Sunnis--of which only 3 percent of them voted a year ago when they formed their interim government, and barely a third of them voted 2 or 3 months ago when they voted on their constitution--I understand now that over half the Sunnis are going to vote tomorrow. They will elect anywhere from 50 to 55 to maybe 60 members of this new parliament. The Kurds are expected to elect a similar number, and the Shiites will elect maybe 100, 110. There is not enough among any of them to have a majority. That outcome will create a need, and that is a need to form a coalition government.

The real challenge will come, though, after the vote, as Iraqis confront at least two enormous tasks. One is setting up a functioning government, and the second is rewriting or amending the constitution they just adopted a couple months ago, while at the same time trying to subdue an armed insurgency.

America must do all we can to make sure that the Iraqis' experiment with democracy does not founder, even if this experiment results in something less than a Jeffersonian democracy. But to succeed and become a new and prosperous country, Iraq will need more than just our help. European countries and other nations, including democratic nations, can do their part by helping Iraq set up government ministries and agencies designed to oversee everything from defense and finance to human services and environmental protection.

In fact, I strongly support a proposal that would call for individual countries to adopt a new ministry in Iraq and help them to develop and implement and execute sound policies. For example, Nation A might adopt a finance ministry, Nation B might adopt a foreign ministry, Nation C might adopt the petroleum industry, Nation D might adopt the transportation industry, and on and on and on. It should not be just us; it should be a whole lot of countries joining with us in this effort.

Arab countries that have been extremely critical of the war and of America's occupation must realize they have a dog in this fight, too. On that point, I am more optimistic than I was before my trip. As Saudi King Abdullah told us a week or so ago--these are his words--``In Iraq, what's done is done.'' That is coming from a monarch, a King, who, frankly, did not appreciate, nor did his people much appreciate, our invading Iraq and taking down the regime of Saddam Hussein. But his words: ``In Iraq, what's done is done.'' And from that, I infer he means it is time to turn a page. It is time for them and other Arab nations in that region to get off the bench and get into the game. And they sure need to.

To that end, I sense that many of Iraq's neighbors, including Saudi Arabia, the United Arab Emirates, Kuwait, and Qatar, realize it is in their interest to make sure that Iraq does not erupt into civil war, a civil war that could become a regional war or turn Iraq into a haven for terrorism. Those nations could help ensure a better outcome in Iraq by, among other things, forgiving the Iraqi debt they hold while also working to improve political relations within Iraq. The United States, perhaps through the Arab League, should exert considerable influence in the region to make sure this happens.

Another area in which the United States and other nations can be helpful is to assist Iraq in formulating and implementing, next year, an economic recovery and growth strategy. Iraq, as we all know, is blessed with enormous oil and gas revenues. Yet it is almost beyond belief that today, some 30 months after the U.S. invasion of Iraq and the lifting of the oil embargo in Iraq, oil production in that country is really no higher today than it was on the day of our invasion. In fact, we were told on our visit that oil production today continues to hover at barely one-third of Iraq's capacity of some 5 million barrels of oil per day. But, roughly, that leaves 3 million barrels of oil a day untapped in the ground, even though there is the capacity to draw it out and to refine it and to sell it. At $50 per barrel and 3 million barrels per day, that means that Iraq is leaving approximately $150 million per day on the table in unrealized revenues. That is about $1 billion a week. For $1 billion a week, you could hire several armies to protect the generating capacity, the oil production capacity in that country.

That kind of revenue also would allow the Iraqis to have some money left over to meet a number of their needs. And they have plenty of needs to

meet. That is money that could be used to lower the 25-percent unemployment rate among young Iraqis, along with the unemployment rate among adults in that country. How? By putting them to work on a host of worthy projects around the country--schools, health centers, roads and transit projects, housing, wastewater treatment, electricity generation, telecommunications infrastructure, and the list goes on.

Speaking of economic development, Saudi Arabia continues to increase its oil revenues by more fully integrating their oil and gas business to include surveying, exploration, drilling, recovery, refining, and transportation, as well as providing feedstocks to a growing petrochemical industry. There is no reason why Iraq could not also do the same over time.

But unlike a number of other Arab nations, Iraq's economy does not have to be what I call a one-trick pony. Iraq is blessed with an adequate water supply and plenty of fertile land. Crops, produce, and fruits raised on that land can feed all of Iraq and much of that region. We can help the Iraqis figure out how to realize their potential, and we ought to do it.

Iraq is also blessed with a well-educated workforce, many of whom would like to be entrepreneurs in their country as they move away from a command-and-control economy to more of a free enterprise system. I am told that last year some 30,000 Iraqis applied for business licenses to start their own businesses. A lot of them could have used an infusion of capital to get started, too. They did not need $50,000 or $100,000, either. In a number of instances, as little as a couple of hundred dollars is all they might have needed.

One of the missing ingredients in Iraq in terms of an economic recovery is a banking system that can make and service loans, including loans to small businesses, which generate a lot of the jobs. In America, we know banking. So do some other nations. We need, collectively, to do more to help Iraqis establish a banking system to fuel, among other things, the growth of small businesses--the engine for job creation.

On a positive note, USAID has begun operating in Iraq trying to develop those micro-loan programs that they are putting in place in other nations around the world where maybe $100 or $200 or $300 is extended in a loan to a small businessperson. That is a good program. It is just beginning, but it is one we ought to kick into high gear there.

The idea of Iraq as a tourist mecca was not the first thing that came to mind as we headed for that part of the world. Having said that, Iraq is the home of several of the holiest shrines in the Muslim world, and, lest we forget, it was also the cradle of civilization. Muslims come from all over the world already to visit a number of those holy shrines in Iraq. Given the chance, I believe a lot more of them would come to visit some of those holy places, other holy places, in Iraq if there were airports to serve them, along with restaurants and hotels, bus service, auto rental agencies, and the like.

Next, let me add a word or two about Iran, a largely Shiite nation that borders Iraq, as we know. Iraq's Shiite population lives primarily in the southern part of Iraq. Hundreds of thousands of people have crossed over the border from Iran into Iraq over the past year or two. Tens of millions of dollars have followed them into Iraq. Many in the region fear, understandably, that Iran is attempting to expand its influence through southern Iraq all the way to its border with Saudi Arabia. Others fear a balkanized Iraq divided into three parts, and maybe eventually three countries, will evolve, and those fears are understandable.

Last week, in an unprecedented move, Iran's supreme religious leader, the real boss in that country--not the President, the real boss in that country--sent a personal emissary to Saudi Arabia to meet with its King, King Abdullah, apparently to begin a dialog. That was 2 weeks ago. I said 1 week. It was 2 weeks ago.

Recently, Iran has also sent word to U.S. officials in Iraq, through the U.N., through Shiite persons in Iraq, that the Iranians would also like to send, I believe, their national security adviser to meet in Iraq with our representatives there. I am told that our administration, apparently, is not prepared to give the green light for those talks, arguing that any talks should involve much lower level Iranian representation.

The words of another Arab leader we spoke to on this subject are instructional. That Arab leader said to us during our stay--he was talking about the U.S. unwillingness to join multilateral talks over Iran's nuclear policy but this monarch said to us:

Ignoring someone doesn't mean they cease to exist.

Think about those words: ``Ignoring someone does not mean that they cease to exist.'' I would encourage our own administration to give American officials in Iraq the green light and find out what is on the Iranians' minds. It is hard to imagine much damage coming out of such a conversation, and there may be some upside to it. Time will tell.

If we are willing to engage in multilateral discussions with some of those wild and crazy North Koreans, I don't know that there is a lot of danger in sitting down and being involved in direct or multilateral relations with Iranians, all the while making clear that their possession of nuclear weapons is not acceptable to us and the views they have toward Israel and pushing Israel into the sea is anathema to us and something we would never countenance.

Let me conclude on the Middle East by sharing with my colleagues an old Navy story. Long before I came here, I served as a naval flight officer during the Vietnam War in Southeast Asia and later on as a Reserve naval flight officer and mission commander of a Navy P-3 airplane, a four-engine airplane. Our Presiding Officer may have seen the Navy P-3s land at Jacksonville, FL, any number of times in our job to hunt for Red October and patrol the oceans of the world.

Every now and then, we would have to change an engine in one of our planes. They break. You land the plane. You pull into the hangar and pull off the engine and put another one on. It takes a day or two, and you have to test it before you go up in the air again. In the Navy, if you had a really hard job to do, we would liken it to changing an aircraft engine in one of our planes. But a really tough job is one that we had to do by changing the engine of the airplane while the airplane was in flight. When you are doing that, that was a tough job.

What the Iraqis face in the coming weeks and months is the political, economic, and military equivalent of changing the aircraft engine while the aircraft is in flight. Tomorrow, they are going to hold elections. The good news is that for 275 parliamentary seats, some 6,500 candidates have filed and are running. That is an astounding number. When the smoke clears literally and figuratively later in the week, they will have to figure out who won and who of those 6,500 lost. They will have to seat a parliament. Then they will have to start putting together a coalition government, not unlike what the Israelis do from time to time. Nobody is going to have a majority. The Shiites may have 100 or 120. But they will need other forces. Or maybe some of the rest of the people who are there, the Kurds or the Sunnis and others, can create a majority coalition on their own.

They will have to figure out who is going to be the prime minister or deputy prime ministers. They have to figure out who is going to be the minister of finance, of foreign affairs, of transportation, of housing, the environment, petroleum, on and on. They have to put the right people in the leadership roles of those agencies and have good people up or down the line in those agencies so they can formulate, implement, and execute policy.

While they are doing all of that, they will have to rewrite their constitution, or at least part of it. To make matters more challenging, they have to do it all while in the face of an armed insurgency. I suggest to my colleagues, doing any of those things in and of itself-- going through the elections tomorrow, electing a parliament, standing up a government, putting the right people in place to lead those ministries, rewriting the constitution--any one of them by itself is a hard thing to do. Doing them all almost simultaneously during the course of an armed insurgency, achieving that would be

like the triumph of man's hope over experience.

I returned from Iraq more hopeful than when I left. I acknowledge that a lot of hard work lies ahead for us and, hopefully, for a new coalition of the willing in the Middle East. While there are no easy choices or solutions, I acknowledge that. I think we know that. But if we do begin to alter course, as I have outlined earlier, I believe we increase the likelihood that America, Iraq, and its neighbors will arrive at the destination we all seek.

Sergeant First Class James ``Shawn'' Moudy

Mr. President, I rise to talk about a young man who lost his life last Sunday in Iraq. He is an Army sergeant first class who grew up in Delaware, a graduate of Tatnall High School. His name is James ``Shawn'' Moudy. He is the ninth soldier from Delaware to have died in Iraq.

Shawn epitomized the best of our country's brave men and women who fought to free Iraq and to secure a new democracy in the Middle East. Shawn exhibited unwavering courage, dutiful service to his country and, above all else, honor. The way he lived his life and how we remember him, Shawn reminds each of us how good we can be.

Shawn was born in Wilmington, DE, on July 14, 1968, to James and Thelma Moudy who now reside in Newark, DE. Shawn attended the Independence School and graduated from Tatnall School in 1986, where he enjoyed playing football and lacrosse. Shawn then attended 1 year at Marion Military Institute in Marion, AL.

After earning a nomination to the Coast Guard Academy, Shawn decided instead to enlist in the Army. For almost two decades, Shawn traveled the world on tours of duty in Korea, Germany, Bosnia, and later at Ft. Benning, GA. It was in Korea that he met his wife Myong Sun, and today they have a daughter, Sandra Rebecca. She is 13 years old.

In September 2004, Shawn was transferred to Ft. Drum in Watertown, NY, where his family resides today. He was deployed to Iraq in August 2005, a few months ago. Shawn's mission was to train Iraqi troops, and he joined in the security patrols there. Shawn was a member of the 71st Cavalry Regiment of the 10th Mountain Division. He always knew he wanted to be a soldier. He had several uncles who served in the military. As a child, his mom and dad told me, he always drew pictures of soldiers. According to his mom, with whom I was privileged to speak the night before last, Shawn believed that ``the world needs to be safe and protected and free. That's what his whole life was dedicated to.'' Those are her words and his.

Shawn's parents take comfort in knowing their son was doing what he believed was right. Their son was resolute in his belief that the United States should not leave Iraq until a free society has been established. He died Sunday in western Baghdad when the humvee he was driving struck another one of those roadside bombs we hear so much about.

I rise today on behalf of Senator Biden and our whole congressional delegation and the people of Delaware to celebrate his life, to commemorate his life, and to offer his mom and dad and family our support and our deepest sympathy on their tragic loss and on ours.

I suggest the absence of a quorum.

Mr. President, on behalf of our leadership, I ask unanimous consent that the following Senators be recognized to speak as in morning business:

Senator Clinton for 1 hour, followed by Senator Collins for a time to be determined; Senator Kennedy for 30 minutes to make a motion to instruct; Senator Landrieu for 20 minutes.

I further ask unanimous consent that Republican Senators be accommodated, if seeking recognition, in between two Democratic Senators, and that Republican Senators be allocated time that is equal to that consumed by the minority Senators.

Mr. President, I suggest the absence of a quorum.

Mr. President, I commend the Senator from Georgia for his excellent statement. He presented the themes and the basic philosophy which are behind this bill, the deficit reduction bill, which includes that we, as a government, need to come close to living within our means. Hopefully, we could live completely within our means. Secondly, the American people should not always have money taken out of their pockets to support the largess of the Federal Government. We should have a tax burden that is reasonable, but to the extent we can, we should allow Americans to keep their hard-earned money and allow them to make decisions as to where their money should go.

If we increase taxes dramatically, we basically reduce the incentive of people to go out and be productive, which translates directly into a loss of jobs because people are not willing to take risks, are not willing to be entrepreneurs because if their tax burden is so high, the practical effect is they do not create jobs. A job, of course, is the ultimate economic benefit for any family.

So I congratulate the Senator from Georgia. I think his statement was right on. I especially appreciate his comments relative to trying to put in context the comments of the Senator from New York because the Senator from New York used a few hyperboles, referring to ``The Grinch That Stole Christmas.'' ``How the Grinch Stole Christmas,'' of course, is a classic story. First, I congratulate her. I do congratulate her for using the term ``Christmas'' and recognizing this is the Christmas season, not the holiday season, something which my wife continually reminds me about. We don't have a holiday tree; we have a Christmas tree.

But independent of that small aside, let me point out that ``How the Grinch Stole Christmas'' is a wonderful story. It was written by a fellow who went to school in New Hampshire. It is a fantasy. He wrote some other things such as ``The Cat in the Hat.'' And quite honestly, I think the Senator from New York was talking through her hat when she delivered her statement because it, first, was inconsistent with all the facts on the ground, and, second, it represented a philosophy which essentially says, as the Senator from Georgia has pointed out, if you simply tax people more, you can solve your problems as the Federal Government. All it takes is you take more of people's money and we can solve any problem around here.

Where is it factually inaccurate? Well, to begin with, the deficit reduction bill which we passed was a very unique bill. It has only been done once in the last 8 years. This is the first attempt to do it again. It was unique because the way it was structured, as it came out of the Senate--and I congratulate the various chairmen who did this, especially the chairman of the HELP Committee and the chairman of the Finance Committee and the chairman of the Agriculture Committee, which bore the biggest reductions here, and the chairman of the Commerce Committee. Other chairmen also participated, but they had the big, heavy lift.

The way it came out of the Senate was this: It actually ended up saving about $70 billion. But there were decisions made that as we saved some of this money we should reallocate it toward better ideas and better concepts. The practical effect of this was that we significantly, under this bill, expanded the availability of loans called Pell grants to people who want to go to college, low-income people who want to go to college. We significantly expanded it. So 5 million more people, 5 million more kids who want to pursue a college career or college path are going to be able to do so under this bill because of the expansion of the Pell grants.

Why was that decision made? That decision was made because we believe, as Republican Members of this Senate, that if you give people a good education, you give them a better chance to be productive, you give our Nation a better chance to be productive, that as we give more people a better education, we become globally more competitive, and we create more jobs and more economic activity in the United States. As a result, we end up probably benefiting the Federal Treasury because we have more people earning higher incomes who pay more in taxes. But we believe very strongly in that type of commitment.

So this bill, rather than as was represented earlier by the Senator from New York as being some sort of a negative event around here for low-income people, was actually the most significant expansion of the Pell grant program for low-income individuals, certainly in the last 12 years since the beginning of the Pell grant program.

Secondly, the bill again, under this same philosophy, dramatically expanded the availability of funds for low-income and disabled children under Medicaid. This bill, as it passed the Senate, will add 1.1 million people, make Medicaid available for 1.1 million people, basically kids who are disabled and of extremely low income so they will have health care coverage. So some of the savings we took and we applied there.

In addition, the bill expanded the effort to try to help out people who have been impacted by Katrina--unfortunately, a lot of people have been devastated by that storm--and had the effect, and will have the effect, if it is passed, of helping 1.9 million people

who were dramatically impacted by Katrina get Medicaid coverage. Again, that was a decision that was made to reallocate resources.

So the bill itself is probably the biggest and most aggressive effort to try to help people of low income that has gone through this Senate in recent history, probably since the welfare reform bill that was signed by the husband of the Senator from New York.

How were these savings generated which were able to be reallocated? Remember that the bill overall, on a net basis, as it left the Senate, saved about $39 billion. My hope is, after we go to conference, it will save about $45 billion, maybe $46 billion, maybe be as high as $48 billion, $49 billion in net savings. But there are other savings that we have taken and reallocated. Where did those savings come from? Did they come from low- and moderate-income individuals? Were they slashing programmatic activity that benefited low-income individuals, as would be represented by the statement of the Senator from New York that the Grinch has been at work? No. As I said, a more appropriate analogy would have been the Cat in the Hat because she was talking through her hat on that issue.

The savings that expand the Pell grant come directly out of the lenders who, if we do not act under this bill, will realize a $12 billion windfall because the interest rate which students will have to pay will be artificially high unless we adjust that rate to appropriately reflect the marketplace. What this bill did, under the leadership of Chairman Enzi--and interestingly enough, this language came out of that committee in a bipartisan way.

The Senator from New York serves on that committee, as do I. I don't think there was any opposition to this proposal. We essentially said, rather than allowing this $12 billion windfall, which will occur if we don't act by the end of the year, which will occur so that these lenders, these corporations which lend this money to students, and they do a service for the Nation by doing that, but they are getting this artificially inflated rate of return. Because of the way the law was structured, it didn't reflect the actual interest costs or what the real interest costs are today, if we don't act, they will get a $12 billion windfall.

What Chairman Enzi and the HELP Committee said was: That doesn't make any sense. Let's take back that windfall, which was artificially created by Federal law, and take a significant amount of it and expand the Pell grant program so 5 million more kids will be able to get Pell grants, low-income kids. In fact, the whole program is targeted to the lowest of low-income kids who want to go to college. And take another big chunk of it and use it to reduce the debt of the Federal Government. That is a pretty logical approach, certainly not a Grinch approach. It is a rather thoughtful approach, a good approach.

I would say the characterization of the Senator from New York of this bill is inconsistent with the facts on the ground and inappropriate.

The Finance Committee looked at places where we could save money in the Medicaid system. It came to the conclusion that a considerable amount of money could be saved by changing the way pharmacies are reimbursed under Medicaid. So they made a decision. They said: Rather than having an artificially high reimbursement for pharmacies and drug manufacturers, they would rather more accurately reflect the cost of those drugs and what those drugs would go for on the open market and thus take the savings from that and, once again, split those savings. They said: Part of those savings should go to expand assistance to low- income kids, adding another 1.1 million kids to the SCHIP program, the Medicaid Program for low-income kids, and taking another part of the savings and applying it to debt reduction, creating a deficit reduction event.

In addition, they said: Listen, if we don't do something about doctor reimbursements, doctors will end up with their fees being cut by 4.8 percent at the end of the year. We are going to have doctors dropping out of the Medicare system. That is not a very good idea. Low-income senior citizens who want to go see a doctor aren't going to have doctors to see because doctors are going to say: I am not going to practice because my income is being cut. Everytime I see one of these patients who is a Medicare patient, I am losing money. I have to pay insurance, my nurses. I have to pay my overhead. I can't take a 4.8- percent cut.

So the committee said: Let's hold the doctors harmless, basically give them no cut. Well, they gave them a 1-percent increase, but it basically amounts to no cut. And they paid for that, again, by basically reducing areas of Medicare which legitimately should be reduced. Specifically, there is $5.6 billion sitting in the Medicare Part D trust fund, which is actually in Part C, but it applies to Part D, which was euphemistically called the stabilization fund, which essentially was walking-around money for the Department of Health and Human Services to basically pay out to various insurance companies, HMOs, and drug companies in order to buy them into the drug program because there was some concern that not enough people would participate in the drug program.

It turns out, in every State, there has been an overwhelming number of different drug companies and insurance companies offering pharmaceuticals that have been willing to participate. In my State, we have 41 different plans. The problem isn't that there aren't enough. The problem is there are so many people getting confused as to what is available. And that is good news. We hope that there are so many participating. We hope to be able to clarify who is offering what. The fact is, the logic behind the stabilization fund didn't come to fruition. So there was no need to have this walking-around money. It has been referred to as a slush fund. So this committee decided to take that walking-around money and basically use it to make sure that patients, when they go to see somebody under Medicare, when they need a doctor, will be able to find a doctor.

Tell me what is Grinchlike about that. What is Grinchlike about the idea of creating a system where there is actually a doctor when a senior citizen wants to find a doctor because they have a problem and having a proposal which accomplishes that? Obviously nothing. Once again, on the facts of it, the Senator from New York was inaccurate as to the implications of this bill and how it affects seniors and low- income seniors.

Yes, this bill does reduce the debt by, as it passed the Senate, $39 billion. And I suspect if we get it back from conference, it will probably be closer to $45, $46, maybe even higher, $48 billion. Again, what is Grinchlike about that? I ask: What is wrong with reducing the Federal debt? What is the Federal debt? It is our generation spending money to benefit, in most cases, people today, and then taking the bill for that and saying to our children and our children's children: You have to pay for it. It is akin to using a credit card only you don't pay the credit card. You give the bill for the credit card to your children or grandchildren. That is not very nice. That is Grinchlike. If the Senator from New York wants to talk about something that is Grinchlike, it is having a Government that continues to run up debt for current expenses, passing those current expenses on to the next generation and the next generation after that to pay for it. That is unfair. That is stealing the Christmas of our children and our children's children or at least undermining their capacity to go out and have the funds to have as good a life as we have had.

The purpose of this bill was, for the first time in 8 years, to step up to the plate on the most significant part of the Federal budget where the most money is spent and where the most growth is occurring which is the entitlement accounts. As I mentioned before, people need to understand how the Federal Government works in the area of spending. We have the account called appropriations. It represents 30 percent of the Federal Government. It is everyday expenses such as national defense, education, laying out roads, environmental expenses. Those dollars are a decision we make every year to spend. We decide to spend dollars to buy our military equipment. We decide to spend dollars to assist a State in laying out a road. But we don't have to spend that money. We can decide not to buy that piece of military equipment or not to lay out that road.

We can do it every year, and it is called the appropriating process.

In the appropriation accounts, we have essentially frozen spending, under this budget, under the budget which was passed in nondefense discretionary activity. But again, it only represents 30 percent of the Federal budget. The rest of the Federal budget, outside of debt financing, is entitlement spending or mandatory spending. Those are programs where people, because of their situation, or institutions or corporations, because of their situation, have the right to come to the Federal Government and get paid.

They may be veterans, students, senior citizens on health care or on Medicaid or on Social Security. They have a right to that benefit because they fit certain criteria--age or income or experience. Those entitlement accounts are the fastest growing element in the Federal Government. They have been for years. Now they are projected to explode in their rate of growth because of the fact that we have something called the baby boom generation that is about to enter the Federal system. A CBO report is coming out that reflects that it is going to overwhelm our capacity as a society to support it.

The concept that you can tax your way out of this, which appears to be the proposal of the Senator from New York, cannot stand in the face of facts. It cannot stand in the face of facts. Three programs--Social Security, Medicare, and Medicaid--make up about 80 percent of the mandatory spending. Those 3 programs today absorb I think probably around 8 or 9 percent of the Federal budget. Maybe it is higher.

When the full baby boom generation has retired by the year 2030, those three programs will cost the American taxpayer 20 percent of the gross national product of the Federal Government. Why is that an important number? Because 20 percent of the gross national product is how much we have, historically, as a Federal Government been willing to spend for all Government activity, including defense spending, education, environmental protection and health care for senior citizens and Social Security. But by 2030, those three programs alone will cost as much as the entire Government spends today as a percentage of our gross national product.

What are the implications of that? The implications are that in order to pay for that, and to have a functioning government, you would have to raise taxes on our children and grandchildren over this 20 percent level. That number keeps going up because the unfunded liability of Medicare and Medicaid alone is $27 billion. The unfunded liability of Medicare and Social Security and Medicaid together and all of the other entitlement programs is about $44 billion. So the number keeps going up well beyond 20 percent, so by 2040 you are looking at 25 to 30 percent gross national product for those three programs. Maybe the Senator from New York is willing to raise taxes as a percentage of the gross national product well above what we have done as a Nation, generally. We have never had a tax rate which has exceeded 21 percent. That has been hit occasionally, but usually the tax rate has been about 18 percent of GDP. Once you get above 18 percent of GDP as your tax rate, you suppress the Nation's ability to be productive. People will come to the conclusion that there is no point in going out and working harder because the Federal Government is simply going to take their money.

That is what happened in the late 1970s when tax rates were up to 70, 75 percent. People said: Why should I go out and work hard to produce that extra dollar? They are just going to tax it away from me. So Ronald Reagan came along, following the ideas of John Kennedy, and said: Let's cut the tax rate, and it will produce more incentive for productivity, more entrepreneurship, and therefore more jobs and more revenues, and that is exactly what happened.

That is also what happened with George W. Bush. He cut the tax rate in the middle of a very severe recession, followed by the attack of 9/ 11. As a result of the tax-rate cut, we have seen a huge increase in revenues in the last 2 years. That revenue increase is a direct result of the fact that we have created an incentive for people to be productive and create jobs.

So you cannot, as a practical matter, even if you wanted to do this, follow the course that has been outlined by the Senator from New York, which is essentially trying to tax your way out of the problem we confront, which is called the Federal deficit, and the spending of the Federal Government resulting from entitlement spending. The only way you can address this issue is if you take a hard look at the entitlement programs and begin to restructure them so that they become affordable for the next generation.

I wish this deficit reduction bill was much more expansive than it is. I wish it took a hard look at Medicare. I wish we were addressing Social Security. Both of those issues were taken off the table through the political realities of the time. Our colleagues on the other side of the aisle, in I think an act of real fiscal irresponsibility, basically demagogued the President when he suggested that we address the Social Security issue. So we could not move forward on that. Regrettably, the President took Medicare off the table because he said we should let Medicare Part D go forward before we start to move to try to restructure Medicare. I think that was a mistake, but that was the decision. We were left with a narrow number of entitlement programs to look at. Even within those narrow programs, we were asked to limit significantly the scope of our review.

For example, in the area of Medicaid, which we will spend $1.2 trillion to $1.3 trillion on over the next 5 years, our suggestion was simply to reduce that rate of growth of spending by $10 billion. So the rate of spending in Medicaid, instead of being 40.5 percent, would fall back to 40 percent. Even with that, less than a one-tenth-of-1-percent reduction in the rate of growth of Medicaid, it has been described as Grinchlike, even though none of it, as proposed in the Senate, came out of beneficiaries. In fact, as I mentioned, the number of beneficiaries that will receive Medicaid under the Senate bill will expand by 1.1 million people. Rather, the savings came out of pharmacy and drug manufacturers as a result of pricing. But that, under the theory of the Senator from New York, is Grinchlike.

It is hard to accept that on its face, if you look at the facts behind this bill. But what we do know will be Grinchlike is if we pass on to our children a continued expansion of the Federal debt and deficit, so that undertakings which we pursue today as a Government that benefit people today--they are not capital expenses, but they are basically the ordinary operating expenses of the Government from day to day. Those undertakings will continue to be paid for by our children and our children's children. That would be Grinchlike. That takes away from them the opportunity to have as high a quality of life as we have had because their tax burden to pay for our bills will be added to their general tax burden to pay for their bills and, as a result, they will have less money available to do things for their kids, whether it is buying toys, putting them through college or buying a decent family home.

So this deficit reduction bill, which was structured in a very careful way to make sure it expanded benefits to low-income individuals, adding 5.5 million new people to Pell grants, 1.1 million kids to Medicaid, and 1.9 million people who were impacted by Katrina relative to health care costs.

At the same time, it moves forward for the first time in 8 years in an attempt to address the issue of reducing the debt. It is the right policy and it is, rather than being a Grinchlike event, truly an appropriate gift, should we get around to passing it, to our children and our children's children and to those people who benefit from this bill.

Mr. President, at this point, I yield the floor.

Mr. President, I associate myself with the comments of the Senator from Massachusetts and underscore the importance of the points he was making about the need for us to be better prepared to compete in the global economy. I look forward to supporting the Senator's motion, and hopefully the conferees will pay heed to the Senator's strong admonition about what is in our Nation's best interest in terms of investments. I hope I may be added as a cosponsor of that very important effort.

Mr. President, the holiday season is upon us, presenting an opportunity to give thanks for our blessings, reflect on the past year, and consider how we can better demonstrate goodwill to one another. That is the true spirit of this wonderful and blessed season.

Sadly, the budget we are debating this week and, quite frankly, the work of the Congress this entire session has failed to keep faith with the spirit of the season or the priorities of the American people. We are not following through on the promise to rebuild New Orleans. We are not taking the necessary steps to reduce health care costs or make energy more affordable. We are not investing in education as we should to prepare the next generation.

This entire legislative season has been about the misplaced priorities of the White House and the Republican majority in Congress who are unable or unwilling to recognize the realities facing America's families.

Washington Republicans seem oblivious to the fact that 1.1 million more Americans fell into poverty last year for a total of 37 million of our fellow citizens, including 13 million children. In New York City, one in five residents lives below the poverty line. They have turned a blind eye to the fact that 45 million Americans are without health insurance, including almost 3 million New Yorkers.

They have ignored the devastating effects of the job losses that workers at GM, Ford, and Delphi face and our huge and growing national debt, now $8.1 trillion, that threatens the future of our children.

The Republican budget lays bear the priorities of Washington Republicans: Loopholes for oil companies instead of student loans for middle-class families; irresponsible tax breaks instead of affordable health care for the working poor. Now these are choices that would even give Ebenezer Scrooge pause--choices that not only ignore the challenges facing American families but make those challenges more difficult to overcome.

Congress is on the verge of enacting a fatally flawed budget plan that finances further irresponsible tax breaks on the backs of Americans who struggle to pay college tuition, to provide health care coverage for their families, and keep their homes warm in winter.

This budget plan is written in the full spirit of the ``Grinch Who Stole Christmas.'' But instead of taking away the presents and the Christmas decorations like the Grinch did, Congress is ringing in the holiday season by taking away Medicaid benefits, food stamps, child support enforcement, childcare programs, affordable housing grants, and student loan benefits.

At the end of the story, the Grinch sees the error of his ways. I can only hope that the Members of this Chamber experience a similar revelation.

We have been told that these steps are necessary to pay down the deficit. We have been told that the proposed additional cuts and tax breaks are the priorities of the American people necessary to continue economic growth.

Cutting Medicaid, food stamps, childcare, affordable housing, and student loans is no way to balance the budget or secure our children's futures. It is not in the long-term interest of our country, and it is not in keeping with the values of the American people.

What is more, under the Republican majority's budget proposals, the budget deficit would actually increase by anywhere from $10 billion to $20 billion.

Democrats in the Congress know what real deficit reduction looks like. It involves difficult choices on both the revenue and spending side. During the Clinton administration, making the tough choices not only eliminated the deficit but produced the largest budget surpluses on record. If those in Congress who support this budget, the Grinch budget, were truly concerned about deficits, then they would not have opposed the restoration of the pay-go rule, a very simple rule which means you don't spend money you don't have. They certainly would not have approved an additional $70 billion in tax breaks along with the budget cuts, tax breaks skewed toward the most affluent among us that will worsen our Nation's growing fiscal imbalance.

What this bill represents is not only an abandonment of our responsibility to middle-class and working families but the steady erosion of the work support programs that have enabled millions of Americans to find work, get off the welfare rolls, and rise above the poverty line.

The right way to cut the deficit is clear.

Instead of cutting programs that help working families get ahead, cut the subsidies flowing to corporate tax breaks, delay further tax cuts on capital gains and dividends while passing those cuts that benefit the middle class such as AMT reform. The tax cuts going already to the wealthiest in this country are nearly seven times larger than all of the proposed budget cuts in the House and Senate. Moreover, there are tax cuts not yet in effect, such as the repeal of the phaseout of personal exemptions and limitations on deductions that go into effect next year, which will cost over $27 billion in the next 5 years.

We could also allow the Government to negotiate with drug companies to lower the cost of prescription drugs, which was prohibited in the flawed Medicare drug benefit. If Medicare were able to reap the kinds of savings we have seen through the VA system's negotiations, seniors could expect to save more than $100 billion over the next decade in drug costs. This alone is more than four times the savings achieved through the harsh budget cuts being proposed.

We could establish a fund for alternative energy investments by requiring that oil companies, which as we know are experiencing amazing record profits this year, to invest in alternative energy. We could require that they help with people's heating bills this winter. We could bring in $20 billion a year with the right energy investments through the strategic energy fund that I have recommended that would have the benefit of making us less energy dependent on foreign oil.

Of course, we could eliminate the $2.6 billion in new tax breaks that those same record profit-making oil companies lobbied for and won in this year's Energy bill. Why do we not take the oil companies off welfare? I think that is an idea we at least ought to debate in this Chamber. Unfortunately, the Republican majority and the administration have made their choice: Breaks for the special interests instead of compassion for common citizens who face new hardships. They must literally wake up each morning and ask, what are we going to do to help our friends today? Never has so much been done for so few who need it so little.

Look at their plans for Medicaid. The Republican majority is recommending cuts of up to $11.4 billion over the next 5 years. The Congressional Budget Office has estimated that these cuts will

result in higher premiums and copays for over 7 million people, including 3.5 million children. Some 70,000 people may lose their health care altogether. A family just above the poverty line could see an increase of more than $1,000 annually to maintain their health care coverage.

New York would bear a disproportionately high burden of these cuts, as we would stand to lose over $1.37 billion, putting at risk the more than 4 million New Yorkers who depend on Medicaid. Over 97,000 New York children and 12,400 New York seniors would lose a substantial portion of their services under the cuts being debated. Instead of closing tax loopholes, Washington Republicans are cutting health care. It is very difficult to understand how we could be doing this. If we took that $2.6 billion in new tax subsidies for oil companies that are having an aggregate year of profits of--give or take a billion or so--around $100 billion, with that $2.6 billion we could cover the health care costs of an additional 1.7 million children nationwide.

Sadly, the majority has chosen health care cuts and Medicaid as the tip of the iceberg. We can take a look at other damage that will come to American families because of these misplaced priorities. Working parents struggling to pay for child care, health care, and housing will now have the added burden of losing their food payment assistance. Two hundred and twenty-five thousand people will see their food stamps vanish, including up to 14,000 New York residents and some 5,000 New York children.

To put this in perspective, the Republican majority is proposing an approximately $700 million cut in food stamps. If we simply reinstated the Superfund polluter tax, which forces companies that pollute to bear the expense of cleaning up instead of passing it on to the average taxpayers to clean up their mess, that would generate $7.3 billion over the next 10 years, more than 10 times the cost of the food stamp cut.

Additionally, children in households receiving food stamps are automatically eligible for school meals. The Republican bill in the House, while reducing the number of people who will receive food assistance, also eliminates the automatic link and makes it more difficult for hundreds of thousands of low-income children in New York State, as well as many more around the country, to qualify for free or reduced priced meals at school. The House budget is literally taking food from the mouths of children.

Then, what are they thinking when it comes to child support enforcement? If there ever was a win-win program, it is this. It is designed to go after deadbeat parents, collect the money that is owed, which in turn can be provided to the families that are in need, helping lift those single-parent families out of poverty by requiring that their parents work and make regular payments to support their children. Well, no, that is going to be cut as well. Funding would be slashed by $16 billion. That means some $24 billion in child support payments would go uncollected. In the next 10 years, children in my State would stand to lose over $1.4 billion in child support payments.

It is almost impossible to imagine this happening at any time but here we are in the Christmas season, and we are giving a boon to deadbeat parents, taking food out of the mouths of children, cutting people off of health care and, of course, under the radar screen, the Republican majority is trying to use this budget reconciliation process for a major overhaul of our Nation's welfare rules.

I am very proud of welfare reform. In 1997, we created a welfare program that valued work, built around the notion that people should work and that people who do work should not still be poor after they have worked. And that work leads to dignity and self-sufficiency and provides strong role models for children. Back then--it was not so long ago--Republicans claimed to agree that we should support working families, but the policies they are pushing today will punish working parents. It will push those who are literally tottering on the brink of poverty over the edge.

Under their proposal, 330,000 families would lose child care assistance and cities and towns throughout my State would be the ones that would have to provide some kind of help but not with Federal assistance because they would be required to eliminate subsidies for working families. They are the ones down at the local level who will see the results of these wrong-headed policies.

As working families grapple with rising home prices, the Republican majority is trying to eliminate critical grants that create more affordable housing. These grants have been an invaluable source of funds, providing for the rehabilitation of homes that would otherwise be out of reach for low-income working families.

Since 1995, New York has saved 1,746 units of housing as a result of this program; on the chopping block. Goodbye to help for housing. I do not know where the working families in my State or other States will end up living. A lot of them will end up being homeless.

Then we come to a program that is about the future. It is particularly stunning--I am sure many in this Chamber and the House believe that a college education is certainly critical for their own children and grandchildren and is part of the route to success in today's competitive global economy. Well, one would not know by the budget numbers that are coming out of the Republican majority that they have any value for education at all because they are instituting an additional $14.3 billion in charges for student loan recipients, making an education even more difficult to finance. This would be the largest cut in student aid in the history of the loan program.

So while with one hand we paint college education as the path to achievement, with the other we are erecting an even higher barrier for middle class families and working families, let alone poor families, who all of a sudden are going to be told they better try to get their kid to go to college, but tuition is rising so we know it is more and more expensive. Instead of giving more help as we used to do, we are going to make it harder to get the financial assistance that is needed to go to and complete college.

An average student would be saddled with a lot more in costs. For example, if a student had $17,500 in student loans they might pay an additional $5,800 under the Republican plan. In my State, approximately 472,000 students would see an increase in their costs. I do not understand what we are trying to achieve. If we simply took the $18 billion revenue-raising package adopted by the Senate in its tax bill, which repeals among other loopholes another $4.3 billion tax giveaway to oil companies--honest to goodness, don't the oil companies ever get enough tax breaks? I mean, it is not enough that we are paying so much money to them out of our daily paychecks, now they are going to ask us to pay it out of our tax payments--more and more and more subsidies to companies that are making tens of billions of dollars in profits. It doesn't add up to me.

But if we took away those $4.3 billion in new tax giveaways to oil companies and we cracked down on abusive corporate tax transactions such as setting up offshore tax havens in places such as Bermuda to avoid paying United States taxes, we would not have to make it more painful and costly for students to go to college.

So what is the tradeoff here? More subsidies for the oil companies, more offshore tax havens for companies that call themselves American but are not willing to pay their fair share to fund our young men and women in uniform, to help pay for the victims of Katrina or literally anything else? We could keep doing that. I guess that is the Republican philosophy. Or, we can say: Wait. Enough is enough. We don't have to give the oil companies any more tax breaks and let's close these loopholes. It is unpatriotic for these companies to pay not one penny in taxes to this Government, to our national defense, for the blessings that make it possible for them to do business and have a good standard of living. It is wrong.

Apparently that is not the way the Republican majority sees it. What they say is that these spending and tax cuts are progrowth. They are right about that. They are progrowth for the oil companies. They are progrowth for the tax haven companies. But they are sure not progrowth for somebody trying to get through college or some working mom who needs to collect child support

from an ex-husband. I do not see anything progrowth about that for them.

They do not even make economic sense. You know, we know how to do the economy right. We did it in the 1990s. We not only balanced the budget and created a surplus but helped to create 22 million new jobs and lifted millions and millions of people out of poverty. We enjoyed a long period of sustained economic growth. We took on the challenges of the day and we tried to prepare for the future.

That is not what is happening in Washington today, and I am deeply troubled and regretful about the choices that are being made on both ends of Pennsylvania Avenue.

I have spent many years working on behalf of children in foster care. They are probably the most vulnerable of all of our children, the poorest of the poor--abused, neglected, children who get taken away from their families because their families are unable or unwilling to care for them. When they are taken away by the police or by a court or social worker--maybe they are turned in by a neighbor or relative--they become our children. They become the responsibility of every single one of us and we have to work very hard to try to get them reunited with families, to try to find a relative who will love and care for them; absent that, to try to make sure they are safe and secure in foster care while hopefully we try to find a permanent, loving family for them.

It is going to be a lot harder because the Republicans are choosing corporate tax breaks instead of foster care. They are going to slash $600 million from foster care support.

I grew up loving the Christmas season, telling the story over and over again about how Mary and Joseph found themselves with no place to stay and how Jesus was born in the manger. Many people say: Look, they were shut out, left behind. We are shutting out and leaving behind a lot of our children with these budget decisions. It is wrong. It is wrong to reward special interests who can do perfectly fine for themselves and slam the door on foster children who need all kinds of help to even have a chance in life.

It is wrong to give more tax breaks to oil companies and not be sure we are going to have enough money to help families pay their heating bills this winter. It is wrong that we are using Orwellian language to call a budget bill that actually raises the deficit a deficit reduction bill. It may be clever. You might fool some of the people but not for long. The deficit will continue to be a drag on our economy and a burden for future generations.

The American people, and particularly our children, deserve better. The Republican majority's proposals for this budget are not in the best interests of America. They will undermine the hopes and dreams of a lot of hard-working people, people who took us at our word 8 years ago. They got off welfare and they are working now. I see them every day. I go into offices or restaurants all over New York and somebody will come up to me and they will say: Senator, I used to be on welfare, but I am working now and my children are so proud. Thank you. Tell your husband thank you.

I always say: Well, God bless you, take care of those children.

Now what are we doing? We are going to cut the childcare that people need to help take care of their children while they are at work. We are going to cut the housing assistance that people need in order to be able to afford a house or an apartment in most places of which I am aware. We may be cutting their children off Medicaid with all these cuts in Medicaid, so that little girl who needs that expensive asthma medicine in order to keep going to school may be out of luck. We are going to be cutting child support so we are not going after those deadbeat parents to collect money that will help that family stay on the right path, stay out of poverty.

It doesn't make any sense to me, but those are the choices that the elected representatives of the people of this country are about to make. It is time that we go back to arithmetic and reality; we go back to a conservative fiscal policy that pays as you go, doesn't spend what you don't have, produces balanced budgets and surpluses, and takes care of people who are working as hard as they can or who are vulnerable and need our help.

There is a lot of talk about family values. Well, let's value families and let's do it, not just with rhetoric, but with money, decisions, budgets that show what our values are.

So in the spirit of this holiday season I call on the Members of this body to reflect on the choices they will be making in the next few days. These choices are going to have a profound impact on millions of people, less fortunate than we are, but there but for the grace of God go any of us. It will not just be for a holiday season, it will be for years to come.

I think we can do better. I know America deserves better. We can get back on the right path of fiscal responsibility and moral decisionmaking that takes into account the needs of the least among us.

We can build a nation that reflects the best of what we can and should be. I hope we will take this opportunity to do so. If we do not, there will be consequences, and they will reflect badly on our Government.

Let us have a happy ending to the story. The Grinch had an epiphany. The Grinch came back and said: I don't want to be a bad guy. I want to share in the Christmas spirit.

So let us replace this ``Grinch budget'' with an American budget that does what it should do for all the people of our country.

I thank the Chair. I suggest the absence of a quorum.

Mr. President, I rise today to support the conference report for the USA PATRIOT Improvement and Reauthorization Act of 2005. That is a long title. We are talking about the PATRIOT Act.

I am pleased to report to my colleagues and to the President that the House just passed the PATRIOT Act with a very strong bipartisan vote. We need to do the same. I thank Chairman Specter for his hard work in getting this important legislation to the conference.

This conference report is one of the most important that we will pass this year. We must do it prior to leaving because it contains a number of provisions that are absolutely vital to our national security. I say that from my perspective as chairman of the Senate Committee on Intelligence.

Like the original PATRIOT Act, this legislation does contain a number of compromises that are not to my liking. But it is often said that the mark of a good compromise is that it leaves both sides unhappy. We have a great number, apparently, who are unhappy about this bill. I think we can safely say that no one is entirely happy with all of the provisions in the legislation. Simply put, this is not the best possible bill but the best bill possible under difficult circumstances. Again, it is absolutely needed on behalf of our national security.

My primary concern as a conferee was to ensure that the intelligence community retains its ability to effectively use the important tools that are provided by the PATRIOT Act, and I think we have accomplished that goal.

This act reauthorizes all of the PATRIOT Act provisions that are scheduled to sunset at the end of this year. It does, however, impose a 4-year sunset on the use of FISA court orders for business records and roving electronic surveillance and an additional sunset on the FISA-- what is called the lone wolf authority.

Personally, I am opposed to these extended PATRIOT Act sunsets. I know Congress has conducted extensive oversight of these provisions. I know the Intelligence Committee and other committees have, and we have yet to find any evidence--I know this is not the perception we read about in the newspapers or that we hear on the electronic media, but we have yet to find any evidence of abuse or overreaching with respect to these or any other provisions of the PATRIOT Act.

Moreover, this very legislation makes modifications to address the perceived problems with the FISA business records and roving wiretap provisions. I ask this simple question: If we fixed these provisions, why is there need for additional sunsets? It seems to me that Congress always retains the ability to amend the law that is enacted. We have a duty to conduct vigorous oversight with the use of these provisions. The Judiciary and Intelligence Committees certainly do that. We don't need and should not use sunsets to compel oversight of these important issues. That ought to be our reasonable obligation, and we do meet those obligations.

Having said that, I want to highlight the modifications made to two investigative tools that have been widely mischaracterized, in my view, by critics and some in the media--FISA business record court orders and national security letters.

With regard to the FISA business record court orders, one of the most contentious issues during this conference was whether a relevance-plus standard should be added to the FISA business record provisions. Critics argued this tool could be used for fishing expeditions. Our oversight did reveal that this was not the case, but we agreed that relevance was the proper standard for obtaining a business record court order.

Some are not satisfied with this approach and demand that we include not only a relevance standard but a requirement to specify facts that would tie the requested records to a foreign power or to an agent of a foreign power, a so-called relevance-plus standard. The problem with this is very easy to understand. It is a standard not used on any other subpoena, certainly not requiring the prior approval by a judge like these FISA orders. The standard would also leave gaps in the FBI's ability to use what is in reality a nonintrusive investigative tool. Under relevance-plus, by then the FBI would have lost the use of section 215 in important circumstances.

Ultimately, the conferees reached a compromise to address the misperceptions about section 215. Under the conference report, the standard remains relevance to an authorized investigation. Let me say that again. The standard remains simple relevance to an authorized investigation. There is no increased burden of proof. The standard remains the same as every

other subpoena that Congress has ever enacted.

If the FBI seeks records that are relevant to any authorized, full investigation or a preliminary investigation, it should be able to obtain those records. Under this conference report, it still can. But to address the allegations that the scope of lawful national security investigations is too broad, the conferees included language that does provide for a presumption of relevance if the FBI does provide a statement of facts explaining the link between the requested records and one of three statutory categories. Thus, the compromise language encourages the FBI to seek the protection of presumptive relevance by including a link to one of the three statutory categories in its application, but it also maintains the use of investigative technique in those limited circumstances that fall outside the three categories.

The conferees also placed additional restrictions on section 215 orders. Under the conference agreement, the records obtained with a FISA business record court order must be screened through minimization procedures adopted by the Attorney General. These procedures are not required for any other subpoena, grand jury, court order, administrative, or otherwise. In my opinion, minimization procedures should not be required for this low-level investigative activity, especially in light of the requirement for prior judicial approval of an order.

These procedures unfortunately were part of the price we paid to get this legislation passed--a price that I did reluctantly accept to preserve this investigative tool. I urged the Attorney General when this bill was passed to adopt flexible minimization procedures.

These procedures must maintain the ability of the intelligence community to analyze the important foreign intelligence information now obtained by FISA business record orders. That information must be made available over an extended period of time so that the intelligence community will not lose its ability to connect the so-called dots. One current phone number that would be connected to one 2-year-old credit card record that would be connected to one 10-year-old hotel receipt might be the information necessary to stop an attack. We should never forget that, especially in the age in which we live.

Severe retention or any rules of dissemination for these third-party business records will limit the FBI's ability to prevent attacks, and that is the standard we have demanded post-9/11. I can assure you that the Intelligence Committee will examine these procedures with great interest once they are issued.

Next, with regard to national security letters--and the acronym for that is NSL--this conference report makes three important modifications.

First, it will provide for express enforcement of national security letters by creating criminal penalties for noncompliance with the request.

Second, this bill clarifies the process by which the recipients of a national security letter may seek judicial review of requests that are either unreasonable, oppressive, or otherwise unlawful.

Third, this legislation does replace the current blanket nondisclosure rule with a process that requires a special certification by a high-level official to invoke the protection of the nondisclosure provision. If the official is sufficiently high level, the certification that the disclosure would endanger national security or interfere with foreign relations will not be overturned by a court without a showing of bad faith.

Some have questioned the need for nondisclosure provisions on these national security letters or complained that they can be invoked or defended much too easily. I have an opposite concern. I am concerned that the disclosure of the fact that the FBI has sought business records might hinder the investigation of a terrorist network or an espionage ring. Nondisclosure requirements on these national security letters are absolutely necessary for the protection of our national security. We must all keep in mind that these so-called NSLs are issued in the context of classified investigations of terrorists and spies.

Make no mistake, the national security letter that requests information in support of a classified investigation should also be classified. But because many phone companies, Internet service providers, financial institutions, or credit card companies don't have the facilities to handle classified information, these national security letters are submitted in unclassified form. The FBI relies on the nondisclosure provisions in the NSL statute to prevent the disclosure of classified investigations of terrorists and spies. Without the protection of a nondisclosure provision, the FBI would have to choose between not using a national security letter or taking the risk that its investigation will be disclosed to the spy or terrorist under investigation. We can't afford either option.

If a terrorist becomes aware of an FBI investigation that was directed at him based on the fact that a national security letter has been issued, he obviously can take actions to protect other members of his cell, ensure that the terrorist network does proceed with other planned attacks, or, in the worst-case scenario, speed up the time line of a planned attack.

We also cannot afford for the FBI to walk away from valuable intelligence information from fear the disclosure of a national security letter might undermine an ongoing investigation. These NSLs do provide access to limited categories of third-party business records that form the building blocks of national security investigations. They allow the FBI to identify the activities of a terrorist or spy and others who associate with them.

The conference report maintains the protections of the NSL nondisclosure provision. It does modify the nondisclosure provision so it is no longer automatic; it must be invoked. It provides the recipients with the avenue to challenge the nondisclosure not once, but every single year. Subsequent challenges also require the Government to reexamine the need for secrecy.

With these modifications, it seems to me the conference report strikes the balance needed on this issue. First, we protect the very legitimate rights of the recipients and ensure the sensitive investigations of terrorist and spies certainly are not compromised.

So as my colleagues can see, the protections that are provided in the conference report for privacy and civil liberties are extensive. In fact, I think the modifications to the FISA business record orders and the national security letters should address all concerns raised about these tools. I hope my colleagues who have concerns about this know what is in this bill as opposed to what the perception is.

The conferees did not stop there. In addition to the modifications I have mentioned, the conference report includes the provisions enhancing existing oversight of these tools. For example, the bill requires the Department of Justice Inspector General to conduct extensive audits of both the use by the FBI of the national security letters and FISA business record orders. The bill also expands public reporting on these investigative tools.

I cannot help but note at this point that many of the protections for privacy and civil liberties incorporated in this bill were derived from the protections that the intelligence committee would have applied to the national security administrative subpoena that we reported in June in our bill. This conference report has essentially taken all of the protections that were contained in the national security administrative subpoena provision, but it has failed to provide the FBI with the same ability to access records that now exist in 335 other contexts.

Far too often we legislate to the possible rogue FBI agent, one-tenth of 1 percent who might go beyond the law. When we take this step, we deprive the other 99.9 percent of FBI agents of a lawful investigative tool, and then if something is missed or we have an attack, why, of course, we blame the FBI. Our oversight reveals no abuses. Yet we deprive our national security investigators of these constitutional tools.

I challenge opponents of national security administrative subpoenas to provide one good reason the FBI should not have the authority. I have listened to their arguments. I still have not heard one good reason. Four years removed from 9/11, it is far too easy to put restrictions on the intelligence community that are not necessary or appropriate. It seems to me we must

continue to ensure that we provide lawful access to data with appropriate precautions. We must tear down the remaining walls that prevent access to lawfully collected intelligence information. One of the top priority goals of the intelligence committee is information access. That is the one thing that seems to me that we must reach out and accomplish, and obviously passing this act and not rebuilding walls to make this problem worse is a top goal.

When we needlessly restrict intelligence investigations, we increase the possibility that the next attack will succeed. I will oppose such restrictions and will continue to fight for new authorities for the intelligence community. I believe the national security administrative subpoena is an appropriate tool that would increase our security without sacrificing our civil liberties. I will continue to ask a simple question: Why are we withholding administrative subpoenas from those who investigate spies and terrorists when they are being used every day by those who investigate health care fraud, drug violations, and other similar matters.

As I have asked many times before, why can the Attorney General use an administrative subpoena to stop a dirty doctor or a dirty drug dealer but not a dirty bomber? That does not make sense. This is a tool that the President, the Attorney General, and the Director of the FBI have all asked Congress to provide in regard to our national security investigators. Once again, Congress has denied them.

Before concluding, I want to highlight one more important intelligence-related provision in this bill: section 506. That is the section that will establish a national security division within the Department of Justice that is consistent with the recommendations of the executive WMD Commission. The national security division will be headed by the Assistant Attorney General for National Security who will be appointed by the President, with the advice and consent of the Senate.

This process, in regard to confirmation, will be subject to the shared jurisdiction of the Senate Judiciary Committee and our Intelligence Committee.

The provision also requires the Attorney General to consult with the Director of National Intelligence before recommending a nominee to the President. I believe the creation of the national security division will help prevent the rebuilding of these walls that I keep talking about that once hindered access to foreign intelligence information. This new national security division will help ensure that law enforcement and intelligence are indistinguishable partners in the protection of our national security.

Finally, I strongly oppose passing a short-term continuing resolution, as some have suggested, to reauthorize existing authorities. The conferees have already worked extremely hard to reauthorize the existing authorities. I do not believe that any additional time or negotiations will close the gap between the opponents and the supporters in regard to this act.

In fact, on the one issue that prevented some conferees from across the aisle from signing onto the conference report, the so-called bad- faith certification provision, this conference report is actually more protective of national security letter recipients than the version previously passed by the Senate.

I hope the folks who are upset about this know that is in this bill and that this is actually more protective. As convinced as I am that an additional 3 months will not close the gap between opponents and supporters, for those who want a continuing resolution, I am equally convinced that further negotiations will only result in additional concessions that will make the PATRIOT Act tools virtually useless.

I remind my colleagues again that 4 years of oversight of the use of the authorities that are provided by the PATRIOT Act have not revealed one single substantiated--let me emphasize that, substantiated-- allegation of abuse. Yet despite this fact the conference report before us today contains numerous additional checks on the use of the PATRIOT Act tools.

The arguments for these additional checks and restrictions are not based on any factual allegations of abuse but, rather, on unsubstantiated allegations, hypotheticals, innuendo, and perception. I understand the concern, but facts are stubborn things, and there has been no abuse. Nonetheless, this conference report will place more burdens on national security investigators using these constitutional tools to defeat terrorists and spies. Further compromise will only serve to negotiate away these very crucial tools. I urge my colleagues to base their position on this important legislation on facts. Facts are stubborn things, as I said before: The fact that terrorists continue to seek to kill Americans, the fact that they continue to plot attacks against us, the fact that they are determined to continue their war against us, the fact that this conference report does provide significant increased protections for privacy and civil liberties, and the fact that our national security investigators have not abused authorities that are provided under the original act.

We have had plenty of time to oversee the use of authorities that are provided by the PATRIOT Act and plenty of time to separate fact from fiction or the wheat from the chaff.

I am deeply committed to the men and women of the intelligence community. The USA PATRIOT Act has provided them with important tools to keep us safe. We should continue to do that. I will vote for cloture if necessary--I hope it is not necessary--and in favor of this conference report. I, again, am very glad that the House has passed the reauthorization of the PATRIOT Act by a large bipartisan vote because this allows the intelligence community to retain these important PATRIOT Act tools and keep America safe. I urge my colleagues to do the same.

I yield the floor.

I suggest the absence of a quorum.

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

Mr. President, I thank the Presiding Officer. I thank you for the opportunity to speak.

I had not intended to come to the floor today but I passed my television set in my office, and I caught the preceding speech regarding American priorities and certain allegations regarding leadership at both ends of Pennsylvania Avenue. I felt compelled for a second to try to answer some of the rhetorical questions that were asked but never responded to in the speech. If I heard it right--I could be corrected--one of the questions was ``I don't understand what we are trying to accomplish.'' It was stated in the context of extending the tax cuts, I presume the tax cuts the House passed--to extend on capital gains and dividends. I will assume for a second that was part of them. There may have been others, and I will address some of them, but I thought it was time, at least for those who might be watching and listening today.

There are two distinct philosophies in Washington, DC. One has just been characterized. My hope is, in the few minutes I have been allocated, to be able to characterize the other.

When George Bush took office at the beginning of his first term, this country was moving into a serious recession which was realized shortly after that term began.

In September, on the 11th day of September, in the year 2001, America had the most unbelievable, heinous attack upon us that has ever been perpetrated, even worse, both in death toll but also in tragedy, than that of Pearl Harbor. That event, on top of the declining economy which was inherited in large measure by the administration, this President, and in turn this Congress, set on a new course to do two things: One, empower the great economic engine of America, which is American business and free enterprise. We did so by strictly passing legislation in terms of tax cuts and changes in tax policy that would empower American business, offer the incentives for more jobs and bring us out of the economic difficulty we were having.

I submit that is precisely what has happened. If you look at the last 5 years, we have gone from a period of recession, which began in 1999, peaked probably in 2000-2001, and since, we have continued to climb and improve. Why have we done so? We have done so because we empowered the American business person and the American employer and the American employee by allowing them to keep a little bit more of their business and invest it in this great country, spend it in discretionary spending, buy a new home. Economic

enterprise breeds economic enterprise which breeds more economic enterprise.

We know from the standpoint of our side of that philosophical issue, if you empower business to do more business, the American Government will prosper. Our revenues have gone up in this country. They have not gone down because of tax cuts. June 15, 2005--this year--was the largest single take in tax revenue in the history of the United States of America. It was because our country is running on all cylinders, or almost all cylinders.

When I went to college, 95 percent employment was full employment. We have that today. We have had an unbelievable sustained period of very positive interest rates. We have had an economy that has not been attacked by inflation, and inflation continues to be under control. The jobs that were lost because of the recession in the early part of this decade are coming back, and they are coming back at a rapid rate. Business formations, prosperity, American home ownership is at an all- time high. The real estate industry is at an all-time high. American business enterprise is thriving, and I submit it is not confusing to me. I do understand what we are doing. What we are doing is we are empowering that which has always taken this country to great heights: the American free enterprise system, the American taxpayer, the American employer, and the American employee. We are empowering them with their money and believing they can do it better, and we can prosper together.

The other side's philosophy is, you charge the people more money to take care of the problems you perceive. Instead of empowering them, you shackle them with less money, you empower government, you breed mediocrity. That is wrong.

No one predicted September 11. Nobody could have ever predicted September 11. But while in the process of reinvigorating the American economy through strategic tax cuts, this administration has confronted the most horrible fate a country could confront on September 11 in the attack of terrorism. We have pursued terrorists around the world. We have secured our airports. We are securing our ports. We have been fortunate not to have an attack on our soil since that date. That did not come cheap. It came at a great price. A great price we have financed, in part, obviously, with the deficits that were referred to. But we paid for an awful lot of it with the growth in our revenue from an empowered taxpayer and an empowered employer and an empowered employee.

I just want to make a couple things clear. I am one member of the majority party of this Senate, and I can only speak for myself. But I take issue with being characterized as someone who is trying to cut health care, someone who is trying to take food out of the mouths of children, somebody who is trying to take welfare and turn it back around and hurt people on welfare to recovery, someone who is trying to make it harder for kids to go to college.

All of those examples that I heard in the previous speech were examples of taking an issue and distorting an issue to make it appear that one side is against children, for hunger, against education, for ignorance--all those negative connotations. So for a second I will address them, if I can.

We had an earlier motion in the Senate today with regard to Medicaid. We have a lot of Governors in this country who are attempting to get flexibility with Medicaid. I happen to be one who supports giving the Governors flexibility from the standpoint of Medicaid. Why? First of all, they and their legislatures administer Medicaid, we don't. We pay for two-thirds of it, but we hold them accountable for its administration. If they are accountable for its administration, and they are paying a third of the costs, and we are holding them accountable, by golly, they ought to get flexibility to use some of the tools. I know the distinguished Presiding Officer knows about tools in medicine today and applies them to health care for our poorest.

Being more flexible for our Governors to deal with one of the largest single expenditures of State government, the largest in my State, is good common sense. It is not cutting health care. It is empowering the people who are helping to get it to the people who need it.

This business of taking food out of the mouths of babes, I do not know what the Senator from New York was referring to specifically, and I will give her the benefit of the doubt. But I will say, cutting the rate of growth in programs is not taking food out of the mouths of people who are getting it. Cutting the rate of growth in spending is trying to manage our budget. I have never seen a time, even back in the early 1990s, when the Republicans were attacked in the House for taking the food out of the mouths of young children. It was the rate of growth in programs that was talked about. It was not real dollars. I submit the reference today was probably precisely the same thing.

As far as welfare rules are concerned, one of the great legislative initiatives of the 1990s was welfare reform and welfare-to-work. I have been to the centers in my State. I have seen the bulletin boards, the success stories today of people who were on welfare, shackled for a lifetime, and then empowered by welfare-to-work legislation. We have reduced our roles in this country tremendously. We have not really reduced the cost of welfare that much because we are providing childcare, we are providing training, we are providing transportation, and we are providing education.

But do you know what we did. We slowed the growth of the cost of welfare to the American taxpayer. In the process of doing it, we empowered Americans who thought they were shackled for a lifetime in poverty, in welfare, because we got them job training. We got them child assistance while they were being trained. We empowered them and challenged them to go off of welfare and on to work. And they are there today. That is a great accomplishment.

As to the student loan business, I do know a little bit about that. We were tasked in the Health, Education, Labor, and Pension Committee on budget reconciliation with finding some savings. The characterization in the previous speech was it will cost students more money to go to college and to borrow on student loans. There are going to be some costs, that is correct. We still, however, as a government, provide through Pell grants and through assistance in the College Loan Program unparalleled assistance to students wanting to go to college and to finance that education. We are merely trying to make that program accountable and live to a certain extent within our means.

There was a comment in the preceding speech that it is time to get back to arithmetic and reality. I will address my remarks to that for just a second.

There is not one Member in here who likes the deficit situation we have been in. I applaud the White House for encouraging us, and I applaud Senator Gregg in his diligent leadership to force us to try to bring about savings and begin to reduce the rate of spending in programs. The reconciliation bill we passed, which I believe was $39.4 billion in savings, is a start. It is only a start. We will have to do more.

In the case of the reconciliation and those savings, whatever the program might be, there is going to be somebody who says: Don't cut here, cut there. But for us eventually to make this budget process accountable, we will have to be able to open all of government, look at all of government, analyze all of government, and make hard choices. The reality of arithmetic is you cannot tax America into prosperity. You cannot solve everyone's problem by taxing those who are producing the jobs that employ the people of the United States of America. What you can do, however, is hold yourself accountable on the spending side and empower those who produce the revenues to do more.

The arithmetic of our tax cuts is simple, because of capital gains reductions, mature assets which were held and not liquidated because of the tax rate were sold, and new money was made, and it was deployed in new investments with growth because dividends became equalized with capital gains and, in fact, were lowered in a rate of taxation. Wall Street began to focus on dividends as being a positive thing for companies to do.

There has been a tremendous move on Wall Street, and the market is

stronger and investment in America is stronger because of what we did in bonus depreciation, because of what we did in expensing. In every one of those things that was called a cut, we raised revenue, and we did so because we empowered American business.

But if the Senator from New York or anybody else thinks that if you have a billion-dollar problem, you can just raise taxes by a billion dollars and solve it, and that is the way for us to go in the 21st century, they are dead wrong. Because there is a point at which when you tax, you suppress prosperity, you cause people who have money to make the decision not to deploy that money anymore. You cause the exact opposite of what has happened in this country for the past 3 years since the tax programs were passed.

So while I may have missed some of the points because I caught this in passing and stopped at the TV to listen, I did not miss one point. The point was the question: I don't understand what it is we are trying to accomplish. I will tell you what we are trying to accomplish. We are trying to accomplish empowering the great locomotive of prosperity, American free enterprise, the American employer and employee to do better. And as they do better, the American Government does better, and revenues go up, not because we raised rates but because we raised hope and we raised opportunity.

Secondly, I know where we are trying to go in budget reconciliation. We are trying to go where every American is every day of their life. We are trying to sit around the kitchen table, setting priorities, looking to the future, seeing where we can slow the rate of growth of Government expenditures. We are not trying to take food out of the mouth of a single person, nor to take health care away from a single person. Nor do we want a deadbeat dad not to get caught. We want every child support payment to be made. To characterize one party as being for those things and the other being against them, to me, is quite ludicrous. But you have to go through a budget process of reconciliation and savings by looking at programs, analyzing programs, setting realistic goals for the future, and trying to make them more accountable.

The United States of America is a great and prosperous nation for a lot of reasons. But the most important reason of all, it is a land of hope and opportunity. Taxation can destroy the hope and, in turn, destroy the opportunity when it is carried to the excess no matter how noble the cause on which it is levied.

Mr. President, I thank you for the time yielded to me. I thank you for the opportunity to serve with you in this body. In the next few days, as we close out this legislative session, I hope we can, in the end, be where we started this year, with a goal of empowering the American taxpayer, doing a better job handling the expenses of this country, and doing what we always do in giving thanks to live in the greatest Nation on the face of this Earth, the United States of America.

I yield the floor.