A bill to amend title 32, United States Code, to increase the maximum Federal share of the costs of State programs under the National Guard Youth Challenge Program, and for other purposes.

Mr. President, I send an amendment to the desk.

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

Mr. President, this amendment will increase the minimum wage from $5.15 an hour to $7.25 an hour over roughly a 2-year period. My friend from Pennsylvania, Senator Santorum, will offer his own minimum wage amendment, and he will do so later on in the afternoon. We intend to debate this and vote on it, subject to the agreements of the leaders, probably late Monday afternoon, and we will take the opportunity during Monday afternoon to get into greater details. Both Senator Santorum and I have agreed that we would each make a brief presentation on this item at this time.

We have not seen an increase in the minimum wage for 8 years. At the present time, the minimum wage has fallen to the second lowest level in the last 45 years. Since 1938, the minimum wage has been increased on eight different occasions. On most of those occasions it has been with bipartisan support. Republicans have recognized that we ought to treat people fairly and decently, and those at the lower level of the economic ladder ought to be able to have a livable wage. President Eisenhower felt that way, President Ford felt that way, and the first President Bush felt that way. We are asking the Senate to join us in going back to having the minimum wage at least increase to a reasonable level.

Now, who are the minimum wage earners? The minimum wage earners are men and women of dignity. Even though they get paid at a minimum wage, they work hard, they take a sense of pride in what they achieve, and they do a hard day's work. More often than not, they not only have one job, but they have two jobs and sometimes even three jobs.

What sort of jobs do the minimum wage workers have? First, many of them are teachers' aides in our school systems, working with the young students of America. Many others are working in our nursing homes, looking after the parents who were part of the ``greatest generation,'' men and women who sacrificed for their own children, men and women who brought this country through the Great Depression. These are men and women of dignity who take a sense of pride in their work.

Beyond that, who are they? This is basically a women's issue because the great majority of the millions of people who would benefit from this minimum wage increase are women. It is a children's issue because a one-third of those women have children. So it is a women's issue and it is a children's issue. It is also a civil rights issue because many who earn the minimum wage are men and women of color. So it is a family issue, a women's issue, a children's issue, a civil rights issue, and, most of all, it is a fairness issue. Americans understand fairness. What they understand is anyone who will work 40 hours a week, 52 weeks of the year, should not have to live in poverty in the United States of America. That is what this issue is all about. That is what the vote will be on, on Monday next, whether we are going to say to millions of our fellow citizens that they will not have to live in poverty, although they will still be earning below the poverty rate.

What the amendment will do is the following. It is the equivalent of 2 years of childcare. It will provide full tuition for a child in a community college, or a year-and-a-half of heat and electricity, or more than a year of groceries, or more than 9 months of rent.

This might not sound like very much to the Members of this body who have seen their pay increase seven times since we have last increased the minimum wage. But we ought to be able to say here and now that we will join the traditions of an Eisenhower, a Ford, and the first President Bush, Democrat and Republican Presidents alike, and say those working Americans who work at some of toughest and most difficult jobs, men and women of pride and dignity, ought to be paid a fair wage. That is what this amendment is about. We look forward to a further debate when we have the opportunity to do so on Monday next.

Will the Senator yield?

One of the concerns many of us had in this bill is the interest of fairness. I think fairness ought to be standard for any piece of legislation. As it is currently before us, we will have those who will be able, with their homestead exemption, to preserve homesteads valued at millions and millions of dollars and, on the other side, individuals will lose completely all of their savings because they will lose their homes. There is no fairness there.

The Senator from New York is pointing out in another area the issue of fairness. Those who have resources and have wealth and have the contacts will be able to shelter their resources while basically middle-income working families, the working poor who are trying to get by and have seen an explosion of different costs, on housing, on health care, on tuition, will be buried.

This will be another dramatic example where those who have it will be able to preserve it and those who have been struggling will lose it.

I will ask a final question. A third of all the bankruptcies are among those who are earning below the poverty line. Does the Senator think they will be able to take advantage of this loophole?

Will the Senator yield for a question on that part?

I offered the amendment on the TANF bill last year and the bill was pulled because it was offered as an amendment. So that is part of our frustration.

Mr. President, this legislation that we have before us cracks down unfairly on large numbers of hard-working families that are in dire financial straits because of a sudden serious illness or because their loved ones are fighting in Iraq. Yet, this bill blatantly ignores the real abuses in our bankruptcy laws: the corporate abuses that have become epidemic in recent years. It is the worst corporate misconduct since before the Great Depression.

Some of these companies were brought down by outright criminal activities. Many more of them were driven into bankruptcy by the greed and mismanagement of a small group of reckless insiders who ignored their responsibility to their employees and their stockholders alike.

Current law on corporate bankruptcy is grossly inadequate in dealing with these problems. Often, the very insiders whose misconduct brought the company down do very well in bankruptcy. The people who suffer the most are the innocent victims, the employees, the retirees.

Increasingly, the bankruptcy court has become a place where corporate executives go to get permission to line their own pockets and break their promise to their workers and retirees. That kind of abuse is terribly wrong, and it is our responsibility to prevent it.

Instead, we are considering a 500-page bankruptcy bill that virtually ignores this issue. It does nothing to address the corporate looting by high-level insiders. It does nothing to protect a company's workforce from losing their jobs, their health care, and their pensions. This bill should not move forward until those glaring omissions are corrected, and the Durbin amendment is the way to do it.

Take a close look at the examples of executives in some of America's largest corporations, and see how lavishly they benefitted while their companies went into bankruptcy. Top executives made sure they were well provided for at the company's expense. Yet, loyal employees and their families were left to struggle on their own.

A major corporation in Massachusetts, Polaroid, filed for bankruptcy in 2001. In the months leading up to the company's filing, $1.7 million in incentive payments were made to its chief executive officer on top of his $840,000 salary. The company also received the approval of the bankruptcy court to make $1.5 million in payments to senior managers to keep them on board. And these managers collectively received an additional $3 million when the company's assets were sold.

Yet, just days before Polaroid filed for bankruptcy, it canceled the health and life insurance benefits for more than 6,000 retirees. It also canceled the health insurance coverage for workers with long-term disabilities, and halted the severance benefits for thousands of workers who had recently been laid off.

Polaroid employees had been required to contribute to the company's Employee Stock Ownership Plan. When the company failed, their retirement savings were virtually all wiped out.

The loss was devastating for workers like Karl Farmer, a Polaroid engineer in Massachusetts for more than 30 years. He had been required, as had other Polaroid employees, to pay 8 percent of his pay into the company's Employee Stock Ownership Plan. At its peak, this stock was worth over $200,000. But after the company declared bankruptcy, the stock was worthless. And he also lost his severance pay and medical benefits.

Or take Betty Moss of Smryna, GA. Betty and her husband retired and were traveling across the country in their camper when they learned that Polaroid had stopped her severance pay and that they had lost her health insurance and life insurance. Because of the fall in Polaroid stock, her retirement savings plunged from $160,000 to only a few hundred dollars.

The loss of health insurance and life insurance benefits was particularly devastating for long-term disabled workers. With their disabilities, they cannot go back to work, and they have no way to obtain other insurance coverage.

Sally Ferrari of Saugus, MA, was diagnosed with Alzheimer's disease after working for Polaroid for 20 years. In recent years, she required round-the-clock care. Yet, Polaroid cut off her health care benefits in bankruptcy, which meant that her husband had to stay at work full time until he recently passed away in order to provide medical coverage for his wife.

I also have letters from other employees.

This letter is from David Maniscalco. He was injured while

working for Polaroid. Now he is unable to work, and his

medical bills are consuming his family's savings and his

retirement because Polaroid took away total health care

coverage. He points out:

After Polaroid declared bankruptcy, they terminated all the

people on long term disability, and terminated all of our

Medical, Life and Dental Insurance. I wear a fiberglass back

brace and sleep in a hospital bed and am not able to work. My

wife changed jobs in order to have medical insurance for

herself. And I am on Medicare and a secondary insurance. The

cost to us is $895.00 a month for medical insurance alone.

The problem is, we're using our retirement money to help with

the cost of our medical insurance.

Here you have the corporate officials well taken care of, and the loyal employees were notified with less than 24 hours. And this is how they end up. How? Because they go to bankruptcy court. Does this bill do anything about protecting those individuals? Absolutely zero. Absolutely nothing. Absolutely nothing.

We have here a letter from Elaine Johnson. She lost a lung to cancer. When Polaroid went into bankruptcy, she lost her health insurance, too. She writes:

When Polaroid declared bankruptcy, I lost my life

insurance, medical and dental insurance. Because of my

disability, I'm unable to get other insurance and another

job.

Once you have these serious illnesses, it is virtually impossible to ever get your health insurance again. I have a son who had osteosarcoma at 12 years old. He, as an individual--he is 43 years old--cannot get a health insurance policy today no matter what he is prepared to pay for it, unless he goes into some kind of group. Why? Because he had cancer at one particular time.

Here you have individuals who have disabilities who are tied into their company's program. The company has made a commitment to them. And then what happens? At the time they go into bankruptcy court, one of the first things that happens is the corporate officials free themselves from the obligations to pay the employees' health insurance, and they are left out in the cold.

The list goes on. Polaroid employees, like Betsy Williams of Waltham, MA, were financially devastated by the loss of medical and health care benefits. Betsy was with Polaroid for 28 years, and she thought, when she came down with lupus, her company's disability, health and life insurance would cover her. She writes:

When I received an unsigned letter from Polaroid

Corporation in July of 2002 stating that I (along with other

employees on Long Term Disability) would be terminated by the

company and my medical, dental and life insurance benefits

would end, I was shocked and dismayed. Unable to work because

of my disabilities, my husband (who is also disabled) and I

are forced to pay approximately $1,125/month for a Medicare

Health plan and an additional $400-$500/month for

prescription co-payments, supplies, etc.; no available dental

plan, and I was only able to get 50% of my life insurance at

an exorbitant rate. We now have two mortgages; our groceries

are bought with a credit card; and we are holding on

financially by a thread.

There it is. That is the person who is going to get burned with this bill. That is the person who is going to be marched in. That is the person who is going to be required to pay $10, $15, $20 a week, $80 a month on into the future under this bill. But do we do anything about the corporate executives? Absolutely nothing.

And the list goes on. These are hard-working people who were crushed when

Polaroid cut their benefits. Yet, while they suffered, Polaroid executives filled their pockets to overflowing.

When the chief financial officer left, she got a $600,000 pension. Recently, she received $1 million in severance pay from Royal Dutch/ Shell Company, even though she left under a cloud of scandal. And Polaroid's former president is now the president and CEO of one of the country's largest staff outsourcing companies. He plans to take the company public soon and will reap enormous profits.

Enron, as my friend and colleague, the Senator from Illinois, pointed out, is another flagrant example of massive company looting while employees lost everything. Enron executives cashed out more than $1 billion of company stock when they knew the company was in trouble. And just before the company declared bankruptcy, its top executives were paid bonuses as high as $5 million each to stay on.

Enron workers, however, were forced to hold their company stock until the age of 50. They were subject to blackout periods that executives were not.

They lost a total of $1 billion in retirement savings. Thousands of them lost their jobs. Thousands lost their health insurance. Thousands of them will be dragged into bankruptcy court under this particular legislation.

Yet we have WorldCom, another shameful case. Bernie Ebbers is on trial for corporate fraud. I don't know how many Americans read the newspapers yesterday, but Bernie Ebbers is on trial. He received millions of dollars in personal loans from the company and was originally granted a pension worth $1.5 million a year. This week he denied knowing anything about the biggest accounting fraud in history. ``I don't know about technology. I don't know about financing. I don't know about accounting,'' he claimed.

What about those people I just mentioned who worked for Polaroid all their lives and because of the bankruptcy lost their health insurance, do you think they will be able to give those kinds of answers? Not under this bill.

Ordinary Americans will not have this defense when they are facing bankruptcy. Countless WorldCom employees who honestly knew nothing about the fraud wound up losing their jobs and their retirement.

Another example is the popular retailer Kmart. As Kmart was teetering on the edge of bankruptcy, the company bought two new corporate jets. Once it finally went into bankruptcy, CEO Chuck Conaway was given a $9 million golden parachute. Meanwhile 57,000 Kmart workers lost their jobs, and the company closed 600 stores.

Abuses like these have made the headlines, but this bankruptcy bill doesn't deal with them. It comes down hard on those families who have critical health bills, families who are touched by cancer and heart and stroke, families who have children with disabilities. It comes down hard on those individuals and lets these people off free. And we call that fair? Take away their homes if they live in 40-odd States, but let them keep millionaire homes in Texas and Florida. And they do nothing about it, the proponents of this bill, nothing. Call that fair? Call this bill fair?

We know what it is. It is making the various bankruptcy courts the collection agencies for the credit card companies. Mr. American Taxpayer, you are going to be paying for more bankruptcy judges and staff and buildings because there are going to be so many more people who are going to be thrown into bankruptcy. The fastest growing group of bankruptcy filers is the elderly, individuals fifty-five and older, who are being hit with increased medical costs. As I mentioned the other day, they are seeing increased premiums on Medicare--wait until they get their new prescription drug program and start paying the costs for that, which is an inadequate program that has special provisions in it that have giveaways to the HMOs and to the prescription drug companies. They are just going to end up paying more and more, Mr. American Taxpayer, to support these courts of bankruptcy, and they are going to squeeze our fellow citizens out all the more. Meanwhile other people are getting $9 million golden parachutes.

Senator Durbin's amendment will stop the travesty of high-level corporate insiders walking away with millions of dollars in bankruptcy while workers and retirees are left emptyhanded. This amendment will strengthen the ability of bankruptcy courts to invalidate fraudulent transfers by corporate insiders. The current legislation does zero, nothing. The proponents of this legislation have opposed this effort by the Senator from Illinois. This amendment will strengthen the ability of bankruptcy courts to invalidate fraudulent transfers. Currently the court can only compel the return of money improperly taken out of the company in the preceding year. In many instances the looting has taken place over a number of years, and the court has no authority to go after those lost assets. This amendment will allow bankruptcy judges to reach back as far as 4 years to recover corporate assets.

It also empowers the court to review and set aside the excess benefit transfers made to corporate management while the company was insolvent or which contributed to the company's insolvency. These sweetheart deals often take the form of huge bonuses, golden parachutes, and other payments to corporate executives before the public learns that the company is in trouble. Such payments violate the most basic principle of fiduciary duty, and the bankruptcy court should have the power to correct these wrongs. Every dollar recovered from these outrageous inside deals is another dollar that will be there to compensate workers, retirees, and other creditors.

Finally, our amendment--I welcome the opportunity to cosponsor it with the Senator from Illinois--will give a priority claim in bankruptcy to employees who are forced to invest their retirement savings in employer stock.

Polaroid workers lost their retirement because they were required to invest 8 percent of their pay in their company as a condition of holding their jobs. Workers at Enron were also forced to keep their company stock until the age of 50 and subject to blackout periods during which they couldn't sell their stock, but the company executives could. Under current bankruptcy law, workers have no way to recover from these losses. They deserve a chance to recover some of what they lost. This amendment will provide it.

The issue is simple fairness. We learned even yesterday about the new loophole, about trusts that are going to be created so those individuals who may go into bankruptcy and who have resources can go out and hire a lawyer and shelter their income from any kind of bankruptcy court. But the average worker can't do that. The average worker out there working a lifetime for a company and then dismissed, the company then goes into bankruptcy, can't do that.

They can't hold onto their homes like so many of the wealthiest individuals in our country. In Florida they will be able to do it, but they won't be able to do it in most of the other States. In Texas they can do it, but not in most of the other States. Yet here on the floor of the U.S. Senate, the Senate refused, absolutely refused to show any consideration to home ownership for people who have worked hard all of their lives, just having $150,000 in equity.

This issue is about fairness. If a corporation has gone into bankruptcy, those who ran the ship aground certainly should be not be enriched at the very time those who depend on the company for their livelihood are driven into poverty. Yet that is what happens all too often in corporate bankruptcy today. Any bankruptcy bill which fails to address these critical issues is a cruel hoax on the American people.

I urge my colleagues to support the Durbin amendment, recognizing that bankruptcy reform has to apply to corporations, too.

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

Mr. President, the most disturbing thing about this supposed ``bankruptcy reform'' is the utter lack of fairness and balance in the legislation. It gets tough on working families who are facing financial hardship due to a health crisis, a job loss caused by a plant closing, or a military call up to active duty. The laws of bankruptcy are being changed to wrest every last dollar out of these unfortunate families in order to further enrich the credit card companies.

However, the authors of this legislation look the other way when it comes. to closing millionaire's loopholes and ending corporate abuse. The bill fails to deal effectively with the unlimited homestead exemptions in a few States which allow the rich to hold on to their multi-million dollar mansions while middle class families in other States lose their modest homes. And, the bill totally fails to address the shocking abuse of millionaires hiding their assets in so-called ``asset protection trusts,'' placing them completely beyond the reach of creditors. They can hold on to their wealth merely by signing a paper placing title their bank accounts, stocks, bonds, and other holdings in the name of a trust. The wealthy debtors don't even have to change their residences or put all of their money into a country estate in Florida or Texas. All they need to do is file a trust document in one of the five States that allow this subterfuge. They do not have to relinquish control over their property and it can continue to be used to support their extravagant lifestyle.

Unfortunately, average families facing bankruptcy don't have large bank

accounts and stock portfolios so they cannot take advantage of this loophole. Most couldn't even afford to hire a lawyer to set up the trust. However, that's all right because the asset protection trust scam was not designed for them. It was designed to protect millionaire deadbeats, people who ran their companies into the ground leaving their creditors and their former employees holding the bag. It was designed to protect those who took the money and ran.

Somehow the authors of this bill, after eight years of studying the bankruptcy code in search of ways to tighten the law so that more people would be held accountable for their debts--somehow they overlooked this loophole. I wonder how they could have missed this one. I guess they were just too busy finding ways to make working families pay a few more dollars to the credit card companies.

Fortunately, the New York Times did expose this outrageous loophole and Senator Schumer has offered an amendment to close it. It will empower the bankruptcy court to reach out and pull the assets in these abusive trusts back into the bankruptcy, using those assets to help pay creditors. The vote on this amendment will be a real test of the sincerity of those who say their goal is to hold debtors more accountable for the money they owe. I would hope that same desire to enforce personal responsibility applies to the millionaire deadbeat who hides his assets as well as the working family struggling to survive.

Mr. President, Senator Sessions, on the floor yesterday, criticized Elizabeth Warren's study on bankruptcies, and the high percentage of bankruptcy filers who file because of significant debt related to illness and medical costs, uses.

Senator Sessions cited a U.S. Trustee Program ``survey'' from 2002 that looked into medical costs as a factor in bankruptcy. He argued that ``only slightly more than 5 percent of unsecured debt reported in those cases was medically related;'' ``54 percent of the cases listed no medical debts whatsoever. I want to repeat that,'' he said.

He also said that ``they found that 90 percent of the cases that did have medical debts reported debts of less than $5,000.''

Elizabeth Warren sent a letter to the Judiciary Committee last month which pointed out many of the problems with this U.S. Trustee Program ``survey'':

The survey underreported both the breadth and impact of medical bankruptcies because of the way it was conducted.

U.S. trustee's sample was limited only to chapter 7 cases and omitted chapter 13 cases. Families filing for bankruptcy under chapter 7 have an annual median income of $19,000. Therefore, the average medical debt identified by the U.S. trustee--the average is $5,000 for those with medical debt--is quite substantial for those families trying to cope with medical problems. Mr. President, $5,000 in medical debt is more than 25 percent of the annual income for that family.

The petition data used by the Office of the U.S. Trustee does not include any medically related debts charged onto credit cards such as prescription medications, doctors visits, rehabilitation treatments, medical supplies, hospital bills, or even second mortgages that people have put on their homes to pay off hospital bills and other medical expenses, or cash advances, bank overdrafts or payday loans that people have incurred to pay for medical services when they are delivered or to pay medical bills that are outstanding. If any of these bills were paid by being charged on a credit card, then the trustee's survey would not include them in its figures.

For these and other reasons, the petition data gathered by the U.S. Trustee Program provides very little information about medical bankruptcy. This is why it is so important to survey the

debtors themselves in order to collect accurate data, the way the Harvard study actually did.

I suggest the absence of a quorum.

I announce that the Senator from Wisconsin (Mr. Feingold) and the Senator from Hawaii (Mr. Inouye) are necessarily absent.

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

Mr. President, I ask unanimous consent to set aside the pending amendment, and I send an amendment to the desk.

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

Mr. President, this is the bankruptcy reform bill. It is about 500 pages long. If I went to Illinois and asked the people I represent what they think we should do when it comes to bankruptcy, I am virtually certain that the first thing they would say to me is, you have to do something about these horrible corporate bankruptcies, Enron, WorldCom, and the list goes on, and the abuses which these officers and CEOs have demonstrated as heads of these corporations, the fact that because they were feathering their own beds when their companies went bankrupt, hurting shareholders, hurting employees, hurting investors in pension plans, and hurting retirees.

I think my constituents in Illinois are right. When it comes to bankruptcy, that is the scandal in America. We read about it every day. There is another criminal trial. Somebody is on trial because of corporate malfeasance that lead to bankruptcy. It is going on right now.

When one takes a look at this 500-page bill, how many pages in this bill address corporate bankruptcies? Five. Ninety-nine percent of this bill hardly relate to corporations at all. Ninety-nine percent relates to individuals and families who, through no fault of their own, in most circumstances, are crushed by debt and go to bankruptcy court. Ninety- nine percent of this bill relates to bankruptcies of people who have a medical diagnosis they never anticipated and end up in treatment incurring medical expenses that their health insurance does not cover. That is almost half of the cases in bankruptcy court.

So this bill is designed to make the bankruptcy process more difficult for those individuals and families to get out from under their debt. That is what this is about. So that at the end of the day, when we pass this legislation--and surely we will--the credit card companies and the banks will end up keeping people in debt longer. So that people facing a crushing debt, when all is said and done, will not be able to walk out of that court, having been declared bankrupt, and start their lives again. That is what this bill addresses.

My amendment goes to the 5 pages about corporate bankruptcy. I believe this: If we are going to hold Americans and families to a high moral standard, if we are going to say to them that before they go into a bankruptcy court, pay their bills and prove to the court that they cannot pay their bills before we let them off the hook, if we are going to say that it is immoral and unjust for someone to go into a bankruptcy court and ask to be declared bankrupt and leave their bills and assets behind, if they, in fact, can pay, then fair enough.

But my amendment says, if we are talking about justice and high moral standards, should we not also talk about these corporate CEOs and insiders? Should they not be held to a high moral standard? Should they not be held to the standard of justice? Sadly, this bill does not do it.

When a corporation files for bankruptcy, their workers are left standing at the back of the line behind all the other creditors. Many of them lose their retirement savings, health care benefits and opportunities to get back to work and back on their feet.

The story of Bethlehem Steel Corporation is a good illustration. After years of decline in the steel industry, Bethlehem Steel dissolved in January of last year. Along with the end of Bethlehem Steel, 95,000 retired steelworker employees, who literally helped build America, lost the health care benefits they were promised. These are workers who, at the expense of their own health, went to work every day, played by the rules, paid into their pension plans, anticipated their health care, and yet because of the bankruptcy of Bethlehem Steel they were

left unprotected. They lost their pension. They lost their benefits. They have nothing.

The problem is not limited to just steel companies. WorldCom, a telecommunications company; Adelphia, a cable company; PG&E and Enron, energy companies; Conseco, an insurance company; Financial Corporation of America and HomeFed, banks; United Airlines, U.S. Airways, TWA, all in the transportation business; Texaco, K-Mart, Polaroid, household names. These are some of the once great corporate giants that ended up in bankruptcy. They employed hundreds of thousands of Americans, but once the companies filed for bankruptcy, their employees were left with nowhere to turn.

This bankruptcy bill does not even talk about those bankruptcies and those employees and the problems that they face.

Many of the companies that filed for bankruptcy over the past few years are also associated with world-class scandals: Global Crossing, WorldCom, Adelphia, and, of course, the grand-daddy of them all, Enron. Those corporate giant names are synonomous with corruption, malfeasance, and greed; they are synonomous, from my point of view, with immoral corporate conduct and unjust treatment of their shareholders, workers, and retirees.

It is even more painful to think that while the workers and retirees of these scandal-tainted companies were left with little more than their dignity, the corporate executives and the insiders escaped with their treasures.

When companies are headed for bankruptcy, the corporate insiders know it is going to happen long before the worker out in the plant, and that is especially true when these same insiders are cooking the books. They know where the corporate loot is hidden, and they are going to get their hands on it when they can.

One might say that as soon as he saw the tip of the iceberg far ahead of the ship, the captain of the Titanic sneaked out on the deck, jumped in the lifeboat, went overboard with food, water, and life-vests, and left everybody else behind. That is what happened. Bon Voyage!

Let me describe a case study of the worst: Enron. This is the poster child for corporate corruption.

Enron of Houston, TX. During the 1990s, Enron was the envy of every executive in corporate America: creative, aggressive, growing fast, money coming in hand over fist, Fortune 500's top 10 list of assets with close to $100 billion, and doing business in far-flung reaches of commerce.

By the year 2000, Enron stock had increased in value by 1,700 percent since its first shares were issued in the 1980s. It had 21,000 employees in the United States and all around the world.

But not everything was coming up roses for Enron. Behind the glass walls of the corporate skyscraper in Houston, something very opaque was going on.

Listen to these famous names: Ken Lay, Jeff Skilling, Andrew Fastow. The company's top three executives obviously realized their astronomical success was not based on reality or truth. It was based on hype, speculation, and deceit. It was all smoke and mirrors.

Wall Street analysts later were forced to admit that they made out- of-control valuations of this company based on the puffery of these corporate bandits. All the while, these executives cooked up ingenious schemes to move assets on and off the books, create phony partnerships, offshore accounts, and so-called ``special purpose entities.''

These were just corporate accounting tools designed to move around assets on paper. Why would they do that if they had nothing to hide? Ken Lay, Jeff Skilling, Andrew Fastow, and others at Enron were undeniably the masters of manipulation.

We talk in this bankruptcy bill about what we are going to do with people who are abusing the bankruptcy court. This bill addresses the waitress with a second part-time job who is a single mother raising a couple of children who just was diagnosed with breast cancer and ends up with medical treatment and bills she cannot pay. She is forced finally to go to bankruptcy court.

This bill says, we are going to take care of her. In this bill we will give her a long list of things to do to prove that she is not taking advantage of the bankruptcy court.

But when it comes to these smoothies--Ken Lay, Jeff Skilling, and Andrew Fastow at Enron, and other corporations--this bill is silent. We are for morality when it comes to working families. Obviously, we are not for morality when it comes to these corporate cheats.

They kept the perception up at Enron that they were making money even when they were not, but eventually it fell apart.

On October 16, 2001, Enron reported a third-quarter loss of $618 million and shareholder equity loss of $1.2 billion. The date October 16, 2001, is important. A week later, on October 22, the Securities and Exchange Commission announced an inquiry into the company.

On November 8, 2001, Enron filed an amendment to its financial report revising its income back 4 years to 1997, 4 years of lies, it turns out, once they were caught. They came forward and disclosed $586 million in losses, and obviously investor confidence and their stock values cratered.

The next day Ken Lay entered into a deal with Dynergy Corp. to sell Enron for $10 billion, in a desperate attempt by him to keep that company afloat. A few days later he was forced to admit that Enron was not worth the amount he wanted to sell it for.

Naturally the deal with Dynergy was called off, and on December 2, 2001, Enron filed for bankruptcy.

Let me tell you what happened to two groups of Enron employees during the last few weeks of the company's solvency.

Here is Mr. Lay. Everybody knows his face now. CEO Ken Lay is the man who made over $200 million from Enron stock, and $19 million in bonuses. Other executives in the Enron Corporation received bonuses as high as $5 million. While that was going on, while the company was heading toward a bankruptcy, there were over 5,000 employees who lost their jobs and thousands more who lost millions in retirement savings.

Our bill goes after the employees who lost their jobs. Our bill goes after the employees who lost their health care. Our bill goes after retirees who ended up penniless and were forced into bankruptcy court. We are going to get real tough on them.

But how about Mr. Lay? What price is he going to pay for his misconduct? In this bill, no price at all. Everyone knows about Ken Lay's extravagance.

I won't venture to assert whether Ken Lay had any actual insight or knowledge which he took advantage of insider information as he made sales of stock he held in Enron. Those are decisions for a judge and jury.

But what is certain is that Ken Lay pocketed $81.5 million in loan advances from his company while Enron was cascading toward bankruptcy-- $81.5 million for this man who couldn't run his company correctly. All told, he received over $200 million in Enron stock and $19 million in bonuses.

During the same time Jeff Skilling raked in $66.9 million.

The board of directors was sharing in these good times as well. Sixteen members of the corporate board made a combined total of $164 million, just on selling shares they had in the company. If you add all the other corporate insiders and executives at Enron with the corporate directors and all the amounts they pilfered from the company from 1998 to 2001, the grand total comes to well over $1 billion.

Now let's see how the employees at Enron fared.

There is an old country song by Jerry Reed called, ``She Got the Goldmine, I Got the Shaft.'' It could be the theme song for Enron workers.

Of the 21,000 people worldwide who worked for Enron, 12,200 were enrolled in their pension plan. Over 60 percent of the assets in the plan invested in Enron stock and all of Enron's matching contributions went into company stock as well. But the Enron stock, which once sold as high as $90 during its heyday, became worthless. The workers' losses were aggravated during the course of the weeks when they were locked out of the pension plans and could not even sell the stock as the value of the stock was cratering.

Under Federal law, companies are not allowed to let their employees withdraw their investment while the company switches pension plan administrators. And wouldn't you know it,

Enron chose to switch their plan administrator on October 16, 2001.

Remember that date? That's the very same date I mentioned earlier, when they announced they were writing off more than $1 billion in charges to their books. This meant that thousands of employees sat by helplessly and watched their retirement plan literally disappear before their eyes.

On October 18, 2001, while Enron workers were frozen out of amending their pension plan, the stock price was down to $32 a share. By the time the hurricane blew over and they finally could get to their funds, Enron stock value plummeted to 26 cents per share. Needless to say, the company went into bankruptcy. The employees at Enron could do nothing but sit by and watch their savings melt away during that time.

Thousands of these employees lost their jobs as a result of the Enron bankruptcy. Hundreds, perhaps thousands, were forced into bankruptcy themselves. But during the months and years that led up to this disaster, 29 Enron insiders and top execs walked away with over $1 billion.

I have talked to some of these Enron executives. There is no good explanation. Sadly, this legislation on bankruptcy we are discussing today will not hold them accountable.

Let me give another case study: Polaroid. This is a company that many of the people in Congress from Massachusetts know all about. It filed for chapter 11 protection on October 12, 2001, just a couple of months before Enron did.

Let me show you the chart on Polaroid. CEO Gary DiCamillo ran the company into the ground but received $1.7 million. Other executives got $4.5 million. Over 6,000 employees lost health and life insurance, and thousands lost severance pay. Forced to invest 8 percent of their pay in company stock, they lost their retirement savings, too.

So these corporate insiders--whether Enron or Polaroid or WorldCom or others--were lining their own pockets, taking money out of the company destined for bankruptcy, and the ultimate losers were the employees and the retirees.

The amendment which I sent to the desk is an attempt to level the playing field for employees, pensioners, and others who find themselves shut out of court when companies they work for file for bankruptcy.

There are two provisions in this amendment to protect employees of bankrupt companies.

First, my amendment would address fraudulent transfers made by corporate insiders, all those huge payouts and loans and bonuses and transactions that went to these corporate executives as the company was headed to bankruptcy, these are payouts that exceed anyone's sense of what is reasonable compensation. Under my amendment, those payouts will have to be scrutinized by the bankruptcy court.

Think about that for a minute. These executives were being rewarded with millions, sometimes hundreds of millions of dollars out of corporations headed for bankruptcy.

Most of the time, you are rewarded with a bonus for a good job. They are being rewarded as their company is heading into debt and eventually disbanding. So they know what is going on. They are grabbing the money before they hit bankruptcy court. The money they grab out of the corporation is at the expense of people who loaned money to the corporation, especially at the expense of their workers and retirees. They end up taking the money that otherwise would have gone into the pension funds and putting it in their own pockets.

My amendment gives the bankruptcy court the tools to investigate and treat these fishy, self-serving deals Ken Lay and Jeff Skilling and Andrew Fastow and others at Enron cut for themselves. It gives the judge the power to review questionable insider transfers. That is only reasonable.

It includes a fair and workable formula for what the court can determine might be excessive.

It also extends the period of time a bankruptcy court can go back and recapture the assets of these executives, a 4-year reachback instead of the 1 year allowed under current law and the 2 years proposed in this bill.

As I described in the Enron example, some of the most outrageous transactions by the Enron executives took place 3 or 4 years before the company filed bankruptcy, so this bill would not even touch them. This bill lets those corporate insiders end up in their mansions with hundreds of millions of dollars squirreled away at the expense of the retirees who lost their pensions and their health care. By recapturing these assets, this provision would make more money available for employees and retirees and act as a deterrent to future corporate executives seeking the same sort of sweetheart deal.

But this is not all about Enron. Let me give you other examples in the headlines today.

WorldCom CEO Bernie Ebbers. He took $366 million in personal loans and his contract called for a $1.5 million yearly pension. Not bad. Mr. Ebbers ought to be proud. His skills and talents as CEO took his company, WorldCom, into the record books as the largest bankruptcy in the history of the United States. While he is grabbing all of the money out of the corporation, it is sinking like a rock.

John Jenkins, the former president of Global Crossing. He took more than $1 million in pension benefits--something called ``transitional assistance,'' consulting fees, and other benefits, as his company was spiraling downward.

Let us take a look at Kmart and its CEO, Chuck Conaway. As Kmart was falling apart, eventually becoming the largest American retailer to file bankruptcy, Mr. Conaway received a $9 million golden parachute. About one-half of it was a severance package. But his former employer decided to give him a little break as he left this bankrupt corporation. A $5 million loan was forgiven. Talk about a Blue Light Special at Kmart, this one takes the cake.

John Rigas of Adelphia Communications took about $1 million per month from the company while he and others used it as their personal piggy bank. According to the indictment from the U.S. Attorney, the Rigas family used company loans to buy Adelphia shares and engage in insider transactions between Adelphia and other companies controlled by the Rigas family. Here is one example of how they fared. Rigas and his sons used $2.3 billion in off-balance-sheet loans from the company to build themselves a private 18-hole golf course at the cost of $13 million. Not bad for a cable guy. He raided his corporation for $2.3 billion at the expense of shareholders and retirees.

What does this bill do to that kind of corporate bandit? Nothing. This bill focuses on the employees who lost their jobs. This bill focuses on the retirees who lost their health care and their pension. This bill makes it tough for them.

This is inspired by our feeling that we need more morality and justice in our bankruptcy courts. But wouldn't you start at the top? Wouldn't you start with the biggest thieves in the business--the people who broke a record when it comes to bankruptcy and raiding these corporations?

These insiders knew what they were doing. They saw their companies going down, and they grabbed everything they could get their hands on. They canceled their workers' pension plans and benefits.

My amendment says we would go back 4 years before the bankruptcy to recover that money and put it in the hands of creditors, employees, and retirees.

The second part of my amendment directly helps employees of these companies with some relief in bankruptcy court. This gives them a place in line as creditors that they currently don't have.

The amendment gives them a priority unsecured claim in bankruptcy for the value of company stock which was held for their benefit in an employee pension plan, unless the plan beneficiary had the option to invest the assets in some other way.

Under current law, these retirees who ended up with the short end of the stick in these retirement plans have nowhere to turn. They are not even in line in priority for these claims. My amendment would fix that.

The amendment determines the value of these claims to be measured by the market value of the stock at the time it was contributed to the plan.

In other words, the employee who was not at fault in the collapse of his employer corporation ought to have a fair claim for the fair value of his contribution to his pension plan as it was

valued when he made that contribution. That's only fair.

My amendment is simple, yet necessary. I urge my colleagues to support it.

In conclusion, I am proud of the support of the groups behind this amendment--the U.S. Public Interest Research Group, the National Consumer Law Center, Consumers Union, Consumer Federation of America, Consumer Action, AFL-CIO, United Auto Workers, United Steel Workers of America, and the American Federation of Teachers.

I ask unanimous consent to have their letters of support printed in the Record.

Mr. President, these groups and their members know what happened with these companies.

I am troubled by the fact that the Senate has spent this entire week talking about bankruptcy abuse and making it tough for families trying to pay medical bills, making this process more difficult for the guardsmen and reservists who were activated to go overseas to serve our country only to lose their business at home and face bankruptcy when they return.

There is nothing in this bill to help them. There is nothing in this bill to help them with medical bills.

Senator Kennedy was here on the floor yesterday. He had an extreme suggestion, a radical idea. Senator Kennedy said, if you lose everything because of medical bills, we are going to protect your little home--$150,000 worth of your home--so that when it is all said and done, as sick as you may be, you will at least have a home. But that proposal was rejected. I am not sure of the vote on that amendment, 58-39, somewhere in that range but a partisan vote. Everyone on this side--virtually everyone--voted against it.

According to that vote, we can't help those people. They have to face the reality. They have to face up to the fact they won't have a home to go to when it is all over.

But what about the mansions these CEOs go to, the millions of dollars they have drained out of these corporations for their own personal benefit to buy mansions, to buy golf courses, to create a lifestyle with $30,000 shower curtains? Are we going to hold them accountable for raiding these corporations and driving them into bankruptcy? The answer is no. Not a word in this bill holds them accountable.

I urge my colleagues. If you can work up a rage over the possibility that someone with medical bills that are overwhelming goes to bankruptcy court seeking relief from their debts, can you work up a little bit of discomfort over these CEOs and bandits of the major corporations? Can you bring yourselves to say maybe we will hold them accountable, too, for their misconduct?

It would be a new day in this Senate, a grand departure from the debate as it has gone down at this point. We have never come close to this yet. I haven't heard a word yet from the other side--not a word on this floor by the supporters of this bankruptcy bill about these corporate bankruptcies and what they have done to hundreds of thousands, if not millions, of unsuspecting investors, workers, and retirees.

The Durbin amendment will give my colleagues a chance to do something about it.

I urge my colleagues to support it.

I yield the floor.

I announce that the Senator from California (Mrs. Boxer), the Senator from New Jersey (Mr. Corzine), the Senator from Wisconsin (Mr. Feingold), and the Senator from Hawaii (Mr. Inouye) are necessarily absent.

Mr. President, pursuant to unanimous consent, on the next amendment you should keep in mind Kenneth Lay who, on the road to bankruptcy, took $200 million out of Enron. Bernie Ebbers took $366 million in personal loans out of WorldCom, and John Rigas took $2.3 billion in loans for a golf course--driving the companies into bankruptcy at the expense of the stockholders, employees, and retirees. This amendment reaches back and brings that money to the people who need it. It also gives a claim in bankruptcy for the pension rights that are extinguished in bankruptcy. I ask for Members' support.

I ask for the yeas and nays.

I announce that the Senator from California (Mrs. Boxer), the Senator from New Jersey (Mr. Corzine), the Senator from Wisconsin (Mr. Feingold) and the Senator from Hawaii (Mr. Inouye) are necessarily absent.

Mr. President, today I am, again, introducing legislation designed to fulfill an important promise made by the Federal Government to the people of my State and my region some 40 years ago. That promise, building and completing a network of highways through the Appalachian region is known today as the Appalachian Development Highway System or ADHS. I look forward to working with my fellow Senators to have my legislation included in the reauthorization of the Federal-aid Highway Program, a program at the core of Federal infrastructure investment.

Over the course of the 108th Congress, we failed to reauthorize this program. That legislation should have been enacted into law prior to beginning fiscal year 2004. We are now more than one third of the way through fiscal year 2005 and the 109th Congress must initiate new bills to get the job done. I know I speak for many Senators in stressing the need to complete this job during this session of Congress. We must authorize a bill that addresses our deteriorating highways and bridges, and is not squeezed by the artificial funding ceiling that the administration wants.

The administration's own Conditions and Performance Report again reminds us that a great deal more investment in our infrastructure is essential to prevent the further deterioration of our nation's highways and bridges.

At a September 30, 2002 hearing of the Senate Environment and Public Works Committee, Administrator Mary Peters testified that, despite the historic funding increase accomplished through TEA-21, congestion on our roads continues to worsen. Funding for highway infrastructure by all levels of government will have to increase by more than 65 percent or $42.2 billion per year to actually improve the condition of our Nation's highways. A funding increase of more than 17 percent or $11.3 billion is necessary to simply maintain the current poor condition of our highway network, where more than one in four of our Nation's bridges are classified as deficient.

At the end of 2002, I worked doggedly to ensure that the Senate prevailed in the conference with the House on the omnibus appropriations bill for fiscal year 2003 and rejected every penny of the $8.6 billion cut in highway funding proposed by President Bush. In 2003, I was pleased to join with Senators Bond and Reid, the respective chairman and ranking member of the Surface Transportation Subcommittee in sponsoring a bipartisan amendment to the budget resolution for fiscal year 2004 boosting funding for our Federal-aid Highway Program by several billion dollars. That amendment commanded 79 votes on the Senate floor.

Mr. President, I am one of only two members still serving in the Congress that had the privilege of casting a vote in favor of establishing the Interstate Highway System. I did so as a Member of the other body back in 1956. Of equal if not greater importance to the transportation needs of my region, however,

were the findings of the first Appalachian Regional Commission in 1964, that while the Interstate Highway System was slated to provide historic economic benefits to most of our Nation, the system would bypass the Appalachian region because of the extremely high costs of building highways through Appalachia's rugged topography.

In 1965, the Congress adopted the Appalachian Regional Development Act that promised a network of modern highways to connect the Appalachian region to the rest of the Nation's highway network and, even more importantly, the rest of the Nation's economy. Absent the Appalachian Development Highway System, my region of the country would have been left with a transportation network of dangerous, narrow, winding roads following the path of river valleys and stream beds between mountains.

One of the observations contained in Administrator Peters' testimony back in September of 2002 that especially caught my eye was her statement that ``the condition of higher-order roads, such as interstates, has improved considerably since 1993 while the condition on many lower-order roads has deteriorated.'' The pattern of road conditions mirrors the distribution of wealth in our country. The rich are getting richer while the poor get poorer. That observation becomes especially pertinent when one contemplates the challenge of completing the Appalachian Development Highway System.

We have virtually completed the construction of the Interstate Highway System and have moved on to other important transportation goals. However, the people of my region still wait for the Federal Government to make good on its 40-year-old promise to complete the ADHS. The system is still less than 80 percent complete. My home State of West Virginia is below the average for the entire Appalachian region with only 72 percent of its mileage complete and open to traffic.

Unfortunately, there are still children in Appalachia who lack decent transportation routes to school; and there are still pregnant mothers, elderly citizens and others who lack road access to area hospitals. There are thousands upon thousands of people who cannot obtain sustainable well-paying jobs because of poor roads. The entire status of the Appalachian Development Highway System is laid out in great detail in the Cost to Complete Report for 2002 completed by the Appalachian Regional Commission. This is the most comprehensive report on the status of the Appalachian Development Highway System to date, and I commend the staff of the Appalachian Regional Commission for their hard work on this report. The last report was completed in 1997 just prior to Congressional consideration of TEA-21.

The enactment of TEA-21 signaled a new day in the advancement of the Appalachian Development Highway System. Through the work of the Committee on Environment and Public Works, the House Transportation and Infrastructure Committee, and the administration, we took a great leap forward by authorizing direct contract authority from the Highway Trust Fund to the States for the construction of the ADHS. Up until that point, funding for the Appalachian Development Highway System was limited to uncertain general fund appropriations. By providing the States of the Appalachian region with a predictable source of funds to complete ADHS segments, TEA-21 reinvigorated efforts to keep the promise made to the people of the Appalachian region.

This initiative has been a great success. States are making progress toward the completion of the system. Since the last Cost to Complete Report, 183 miles of the system have been opened to traffic and, the cost to complete the system has been reduced by roughly $1.7 billion in Federal funds.

I am pleased to report that the 13 States, to date, have succeeded in obligating just under 90 percent of the obligation authority that has been granted to them for the completion of the system. A 90-percent obligation rate compares quite favorably to some of the other transportation programs through which the States were granted multiple years to obligate their funds.

According to the ARC's Cost to Complete Report, the remaining Federal funds needed to complete the ADHS as the system was defined at the time that report was completed are now estimated to be $4.467 billion. When adjusted for inflation over the life of the next highway bill, using the standard inflation calculation for highway projects, a total of $5.04 billion will need to be authorized to complete the system. That is a lot of money and I believe that figure deserves some explanation.

The considerable cost of completing the last 20 percent of the ADHS is explained by the fact that the easiest segments of the system to build have already been built. Much of the costs associated with completing the most difficult unfinished segments are driven by the requirement to comply with other Federal laws, especially the laws requiring environmental mitigation measures when building new highways through rural areas. While the $5.04 billion figure may seem large to some of my colleagues, I would remind them that the last highway bill authorized more than $218 billion in Federal infrastructure investment over 6 years. It is my sincere hope and expectation that the next highway bill will authorize an even greater amount.

Of critical importance to this debate is the fact that the unfinished segments of the ADHS represent some of most dangerous and most deficient roadways in our entire Nation. Often lost in our debate over the necessity to invest in our highways is the issue of safety. The Federal Highway Administration has published reports indicating that substandard road conditions are a factor in 30 percent of all fatal highway accidents. I am quite certain that the percentage is a great deal higher in the Applachian region.

The Federal Highway Administration found that upgrading two-lane roads to four-lane divided highways decreased fatal car accidents by 71 percent and that the widening of traffic lanes has served to reduce fatalities by 21 percent. These are precisely the kind of road improvements that are funded through the ADHS. In my state, the largest segment of unfinished Appalachian Highway, if completed, will replace the second most dangerous segment of roadway in West Virginia. So, even those who would question the wisdom of completing these highways in the name of economic development should take a hard look at the fact that the people of rural Appalachia are taking their lives in their hands every day as they drive on dangerous roads. It is time for this Congress, in concert with the administration, to take the last great leap forward and authorize sufficient contract authority to finally complete the Appalachian Development Highway System. If we enact another six-year highway bill with sufficient funds to complete the system, we will finally pay the full costs of the ADHS some 45 years after the system was first promised to the people of my region. The legislation I am introducing today, the ``Appalachian Development Highway System Completion Act,'' will provide sufficient contract authority to complete the system. Importantly, it will guarantee that the states of the Appalachian Region do not pay a penalty, either through the distribution of minimum allocation funds, or the distribution of obligation limitation, for receiving sufficient funds to complete the Appalachian system.

I am very pleased that this administration has taken on the goal of completing the ADHS. In her letter accompanying the Cost to Complete Report, Administrator Peters said ``the completion of the ADHS is an important part of the mission of the Federal Highway Administration. We consider the accessibility, mobility and economic stimulation provided by the ADHS to be entirely consistent with the goals of our agency.'' Ms. Peters further stated that the Appalachian Regional Commission's 2002 Cost to Complete Report, ``provides a sound basis for apportioning future funding to complete the system.'' I thank Mary Peters and the entire Federal Highway Administration for their leadership on this issue and I look forward to working with Ms. Peters and her agency to ensure that this commitment is borne out in the transportation reauthorization legislation that is developed by the Congress.

Completion of a new highway bill will be an enormous task for this Congress--one that is now more than 2

years overdue. As I look back over the many years of my public career, one of the accomplishments of which I am most proud was my amendment providing an additional $8 billion in funding to break the logjam during the debate on the Intermodal Surface Transportation Efficiency Act in 1991. Another was my sponsorship of the Byrd-Gramm-Baucus-Warner Amendment during the Senate debate of TEA-21 in 1998. That effort resulted in some $26 billion in funding being added to that bill and put us on a path to historic funding increases for our nation's highway infrastructure. I look forward again to working with my fellow Senators on completion of a bill that makes the necessary investments in our nation's highways, not just in the Appalachian region but across our entire country.

Mr. President, in recent years, the public profile of the National Guard has changed considerably. Known mainly for the contributions of citizen-soldiers to their States and communities, today the men and women of the National Guard are serving on the front lines in Iraq and Afghanistan, enduring hardships in two of the world's most dangerous places.

In spite of the long deployments, far away from the small towns and big cities that these citizen-soldiers call home, the National Guard continues its work for our States and the American people. Today, I introduce legislation to support a most successful program that has helped the National Guard change the lives of tens of thousands of young Americans.

In 1991, I provided the first funding to establish a pilot program known as the National Guard Civilian Youth Opportunities Program. Over the years, this program has expanded in size and scope and is now known as the National Guard Youth Challenge Program.

The Youth Challenge Program gives high school dropouts the skills they need to turn their lives around. The advantage of using the National Guard to provide a structured environment for these students has been confirmed in studies by the Defense Science Board in 2000, the White House Task Force on Disadvantaged Children in 2003, and the Department of Defense in 2004.

The program now operates 27 academies in 24 States, including West Virginia, Alaska, Hawaii, Georgia, Louisiana, Virginia, Michigan, Florida, Texas, North Carolina, and South Carolina. Over 5,000 cadets are now in training, and more than 58,000 have graduated from the program since 1993. Fully three-quarters of the Youth Challenge graduates have earned their high school diplomas in the program, but the program is at the mercy of shrinking state budgets.

In March 2004, the Department of Defense recommended an increase in Federal support for the program in order to prevent any more closures of Youth Challenge academies. The bill I introduce today would write that recommendation into law, phasing in the additional Federal support over 3 years.

My legislation also proposes to increase the authorization for the Youth Challenge program by $16.3 million, including $6.3 million for the proposed increase in the Federal share of the Youth Challenge Program's cost for Fiscal Year 2006.

My bill authorizes an additional $10 million to provide the first significant per-student increase in funding since the program began. For more than 12 years, the funding of the Youth Challenge Program has remained constant at $14,000 per student, per year. Imagine that. Think of that. At a time when the cost of education is growing by leaps and bounds, the Youth Challenge program has held the line on its budget for more than 12 years.

But such discipline means that there have been cutbacks in teachers, uniforms, and activities. The additional $10 million authorized in my bill would end these cutbacks, and may also be used to open new Youth Challenge academies, giving more at-risk youth a chance to change their lives.

Many of the citizen-soldiers of the National Guard serve our country in distant lands, but their commitment to their communities continues. The legislation I introduce today will strengthen that commitment by expanding the National Guard Youth Challenge Program for disadvantaged youth.

Mr. President, in light of the most recent evidence uncovered about Enron's participation in the Western Energy Crisis, I rise today to introduce the Energy Market Oversight Bill with Senators Levin, Harkin, Cantwell and Wyden.

This bill would: Improve Price Transparency in Wholesale Electricity Markets. The bill directs the Federal Energy Regulatory Commission to establish an electronic system to provide information about the price and availability of wholesale electricity to buyers, and sellers, and the public.

Prohibit Round Trip Electricity Trades. The bill prohibits the simultaneous buying and selling of the same quantity of electricity at the same price in the same location with no financial gain or loss. Round trip or ``wash trades'' are essentially bogus trades whereby no electricity changes hands, but the profit from the trades enriches the bottom-line of a company's financial report.

Increase Penalties for Violations of Federal Power Act. Maximum fines for violations of the Federal Power Act are increased from $5,000 to $1,000,000.; and maximum sentences are increased from 2 to 5 years. Current fines are extraordinarily low and therefore provide no deterrence to illegal activity.

Increase Penalties for Violations of Natural Gas Act. The bill increases maximum fines for violations of the Natural Gas Act from $5,000 to $1,000,000.

Prohibit Manipulation in Electricity Markets. Manipulation is prohibited in the wholesale electricity markets and FERC is given discretionary authority to revoke market-based rates for violations. Strangely enough, manipulation of energy markets is not specifically prohibited. This would add language to Part II of the Federal Power Act.

Repeal the ``Enron exemption''. Repeals the Commodities Future Modernization Act exemption for large traders in energy commodities and applies the anti-manipulation and anti-fraud provisions of the Commodities Exchange Act to all Over the Counter trades in energy commodities and derivatives. In my view, when Congress exempted energy from the Commodity Futures Modernization Act of 2000, it created the playing field for the Western Energy Crisis of 2000 and 2001, and cost millions of people millions of dollars.

Provide CFTC the Tools to Monitor OTC Energy Markets. For Over the Counter trades in energy commodities and derivatives that perform a significant price discovery function, including trades on electronic trading facilities, the bill requires large sophisticated traders to keep records and report large trades to the CFTC. This does not change the law, only applies the law that exists for futures contracts to over the counter trades in the energy markets.

Limit on Use of Data. Requires the Commodity Futures Trading Commission to seek information that is necessary for the limited purposes of detecting and preventing manipulation in the futures and over the counter markets for energy; to keep proprietary trade and business data confidential except when used for law enforcement purposes. This does not require the real-time publication of proprietary data.

No Effect on Non-Energy Commodities or Derivatives. The bill would not alter or affect the regulation of futures markets, financial derivatives, or metals. We have specifically stated on page 20 the following: ``The amendments made by this title have no effect on the regulation of excluded commodities under the Commodity Exchange Act.''

In addition, the bill states: ``The amendments made by this title have no effect on the regulation of metals under the Commodity Exchange Act.''

The Western Energy Crisis of 2000-2001 has still not been resolved. Meanwhile, more and more information about Enron's role in the crisis emerges. On February 3, 2005, the Snohomish Public Utility District released transcripts of tapes showing that on January 17, 2001, Enron traders concocted false repairs for a Las Vegas power plant--making power unavailable that would have been delivered to California--on the very same day that supplies were so tight that Northern California experienced a Stage 3 power emergency and rolling blackouts hit as many as 2 million consumers.

By taking the plant offline, Enron was also in direct violation of an Emergency Power Order by U.S. Energy Secretary Bill Richardson that required power generators to make power available to California.

Telephone transcripts between Enron and the Las Vegas plant

Mr. President, Senator Sessions and I are introducing legislation to combat the use of fraudulent immigration documents, particularly passports and other travel documents.

The need to prevent and prosecute passport and travel document fraud is clear, and this bill would increase penalties for the use of fraudulent travel documents.

We know that the threat of terrorism against the United States is real and as the 9/11 Commission Report states, ``for terrorists, travel documents are as important as weapons.'' In order to minimize the threat of terrorism to the United States, we must make every effort to limit the use of fraudulent immigration documents.

The bill Senator Sessions and I are introducing would make the use of fraudulent travel documents--such as passports, Border Crossing Cards, Canadian driver's licenses or identification cards, transportation letters for parolees, military identification cards or green cards--an aggravated felony which will mandate detention and increase the likelihood of prosecution.

Today, this is not the case. Instead, fraudulent documents are routinely returned to the offender and individuals are allowed to return home without suffering any consequences from their attempts to circumvent our immigration laws.

Why is this a problem?

Firstly, admission to the United States is a privilege and not a right. We should not tolerate fraud and deception at our ports of entry, particularly because it should be apparent that a terrorist organization as sophisticated as Al Qaeda is well aware of our current procedures and can be expected to take full advantage of them.

Secondly, the 9/11 Commission found that as many as 15 of the 19 hijackers on September 11, 2001 could have been intercepted by border officials, based in part on their travel documents. In fact, all but one of the September 11 hijackers acquired some form of U.S. identification document and some of those documents were acquired by fraud. All of the hijackers opened bank accounts in their names and used passports and other identification documents that appeared valid on their face.

Even before September 11, 2001, the use of fraudulent immigration documents to enter the United States was a threat that we did not sufficiently heed.

Let me give you some known examples of terrorists who have entered, or attempted to enter the United States, with fraudulent travel documents: Ahmed Ajaj and Ramzi Yousef attempted to enter the United States with fraudulent passports. Both were later implicated or convicted in the first World Trade Center bombing in February of 1993.

Ahmed Ressam used a fraudulently obtained Canadian passport, and, in 1999 attempted to cross the border from Canada at Port Angeles in Washington State. A border inspector felt Mr. Ressam looked nervous, and a search of his car turned up a trunk full of bombs. There is some debate about the exact target(s) of the attack; however, it seems likely that Los Angeles International Airport and perhaps the millennium celebrations in Seattle were the intended targets.

It is no secret that: as the 9/11 Commission Report makes clear, Al Qaeda has established a complex international travel network that allowed, and presumably still allows, its operatives to legally travel worldwide to train, conduct reconnaissance or otherwise prepare for an attack. This network included, and presumably still includes, the use of altered and counterfeit passports and visas.

Many countries, including France, Portugal and Saudi Arabia, have reported tens of thousands of passports and travel documents stolen. When these are stolen in large numbers, they are sold on the black market to others.

The 9/11 Commission found that had the immigration system set a higher bar for determining whether individuals are who they claim to be--and ensured consequences for any violations--it could potentially have denied entry, deported or come into further contact with the terrorists that were involved in the September 11, 2001 attack on the United States.

Last year, the Department of Homeland Security Office of the Inspector General issued the following reports on lost and stolen passports: ``A Review of the Use of Stolen passports from Visa Waiver Countries to Enter the United States'', December 2004; and, ``An Evaluation of the Security Implications of the Visa Waiver Program'' (April 2004).

I encourage my colleagues to read these reports on the vulnerabilities in our current border security. To summarize, the reports state that: In the United States alone, immigration officials have records for 1.2 million stolen passports.

Aliens applying for admission into the United States using stolen passports have little reason to fear being caught and are usually admitted. It has been standard practice to simply return a fraudulent passport to an individual seeking entry and let them return to their country. This, in effect, is the soft underbelly of the entire passport system.

The Director of the U.S. National Central Bureau of INTERPOL said that for 55 of the 181 INTERPOL countries, there probably were over 10 million lost and stolen passports that might be in circulation.

Law enforcement officials state that lost and stolen passports are the greatest security problem associated with the Visa Waiver Program.

And now that I've mentioned the Visa Waiver Program, let me say a few things about this program.

I believe the Visa Waiver Program is the Achilles heel in our immigration system. This program allows roughly 13 million individuals to enter the United States each year from 27 countries, without a visa--meaning they enter without a thorough background and security check.

Since we do not have in place a fully operational entry and exit program, specifically an exit system, we have no real way of knowing if millions of travelers who entered the United States have left as required.

Last year, Congress extended the deadline for one year for countries participating in the Visa Waiver Program to include biometric indicators in passports to verify the identity of bearers at the request of the Administration.

It is likely this deadline will again need to be extended.

I believe that granting another extension will be another opportunity for terrorists, organized crime rings, petty crooks, counterfeiters and forgers to continue entering the United States virtually unnoticed because we won't be able to confirm that they are who they say they are.

The bottom line is that we must crack down on document fraud if we are to protect our borders. There are thousands, even millions, of lost, stolen and fraudulent international passports, travel documents, driver's licenses and other identity documents in circulation, and we must now allow those to compromise our homeland security.

The purpose of this bill is twofold: first, to give the Department of Justice the incentive to vigorously prosecute all cases involving passport and travel document fraud, as well as certain other egregious cases of immigration document fraud.

Second, by encouraging policies that make these cases a priority for prosecution, it will require that Department of Homeland Security officials not return fraudulent documents to travelers, but instead turn them over to the Department of Justice so that they can institute criminal proceedings.

Unfortunately, the prosecution of immigration document fraud is not a high priority for the Department of Justice, because, although current penalties allow for a sentence of up to 25 years, typically most alien's convicted of travel document fraud serve less than one year in prison.

Also, the immigration consequences of document fraud are relatively minor. Low sentences, coupled with minimal immigration consequences, do not provide much incentive for U.S. Attorneys nationwide to consider the prosecution of immigration document cases a priority nor can they be seen as anything but a slap on the wrists of the offenders.

Senator Sessions and I pose a solution to this problem by toughening penalties so that we instill in those seeking to use fraudulent travel and immigration documents a real sense of fear that they will be caught and prosecuted to the fullest extent possible under our laws.

In any kind of meaningful border protection plan, one must have a good sense of who is entering and exiting the country. That simply cannot be known if the individual is using a fraudulent document.

Mr. President, I ask my colleagues to join me in supporting this legislation.

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

Mr. President, it is a privilege to join Senator Sessions, Senator Durbin and Senator Dodd in introducing the ``National All Schedules Prescription Electronic Reporting Act.'' Our goal is to help States establish electronic databases to monitor the use of prescription drugs and deal more effectively with the growing national problem of prescription drug abuse.

Over 6 million Americans currently use prescription drugs for non- medical purposes. 31 million say they've abused such drugs at least once in their lifetime. Since 1992, the number of young adults who abuse prescription pain relievers and other addictive drugs has more than tripled. Prescription drug abuse among youths 12 to 17 has soared tenfold.

State programs to monitor addictive medications can help curb this abuse. Currently, 20 States have such programs in place, including Massachusetts, but they vary greatly in the collection and storage of the data, and in the methods for using the databases.

The information contained in these databases is important, because it can be used to identify physicians and patients who encourage the non- medical use of prescription drugs. It can also be used to reduce the diversion of prescription drugs for illegal use.

Our bill authorizes the Secretary of HHS to make grants to States to establish these needed monitoring programs. For States with existing programs, the grants can be used to improve their systems and standardize the data collected to allow easy sharing of the information between the States.

Any such program, however, must include strong safeguards for medical privacy, and make certain that the database cannot be used to put improper pressure on physicians to avoid prescribing essential drugs. The proper treatment of pain, for example, is an enormous medical challenge, but this essential care will be much more difficult if patients fear that their prescription histories will not be protected, or if physicians begin to look over their shoulder every time they prescribe pain medication.

We all share the goal of reaching the right balance between the interests of patients, physicians, and law enforcement, and we think this legislation does that. It requires that in grant applications, States must propose security standards for the electronic databases, including appropriate encryption or other information technology. States also must propose standards for using the database and obtaining the information, including certifications to be sure that requests for information are legitimate. The bill requires the Secretary to provide a follow-up analysis of the privacy protections within two years after enactment.

The national problem of prescription drug abuse worsens every year. Physicians want to treat pain without contributing to addiction. Law enforcement officials want to stop the flow of prescription drugs from pharmacies to the streets. A national prescription drug monitoring program will provide a valuable resource to achieve these goals. I commend Senator Sessions for his leadership on this important health issue, and I urge my colleagues to join us in this effort to fight prescription drug abuse.

Mr. President, it is a privilege to join Senators Hutchinson, Schumer, and Cornyn in introducing the Hepatitis C Epidemic Control and Prevention Act. Our goal is to provide for the prevention, control, and treatment of Hepatitis C viral infection through education, surveillance, early detection, and research.

Hepatitis C is the most common, chronic, blood-borne infection in the United States. An estimated 5 million Americans are now infected with the Hepatitis C virus, and 30,000 more are infected every year. The rate of infection continues to rise--between 1990 and 2015, the Centers for Disease Control and Prevention project a 4-fold increase in the number of persons with chronic infection of the virus.

Persons infected with the Hepatitis C virus come from all walks of life, but those at greatest risk include health workers, emergency service personnel, and drug users. Tragically, the majority of infected individuals are unaware of their infection, are not receiving treatment, and are sources of transmission of the virus to others.

Infection with the Hepatitis C virus has serious health effects. It can cause liver disease, including cirrhosis and liver cancer, and is the leading indicator for liver transplants. The illnesses are often life-threatening--up to 10,000 Americans die yearly from Hepatitis C complications, and it is the 7th leading cause of death for men between the ages of 25 and 64. In addition to the human costs, the disease has massive financial implications. Direct costs associated with care are expected to exceed $1 billion a year by 2010. Without intervention, the epidemic is projected to result in costs of over $54 billion by the year 2019.

Greater Federal investment will have a critical role in reversing this silent epidemic. Our Hepatitis C bill will increase public awareness of the dangers of Hepatitis C, and make testing widely available. For those already infected, it will provide counseling, referrals, and vaccination against Hepatitis A and B and other infectious diseases. It will also support research to develop a vaccine against Hepatitis C, just as we now have for Hepatitis A and B. It will create a multiagency Liver Disease Research Advisory Board and mandate a study of programs used by the Veteran's Administration, in order to provide important lessons and models of care for the nation. The Centers for Disease Control and Prevention will increase surveillance activities, and provide Hepatitis C coordinators to provide technical assistance and training to state public health agencies.

This bill will have a major impact on the lives of millions of Americans who are infected by Hepatitis C, and the families and loved ones who care for them. I look forward to working closely with my colleagues to act quickly to pass this needed legislation. I especially commend the impressive work of the students at Robinson Secondary School in Fairfax, VA, for their continuing dedication to informing Members of Congress about this important issue and bringing national attention to it.

Mr. President, I'm pleased to join my colleagues in introducing the Caring for Children Act of 2005. We were able to work together on both sides of the aisle to prepare this bill to reauthorize the Child Care and Development Block Grant program. The Caring for Children Act reflects our common goals to expand access and improve the quality of child care for children and families throughout the Nation.

Child care is a key issue in both welfare reform and education reform. The success of our welfare system rests on our ability to provide dependable and consistent child care support for low-income families, so that they can work and provide for their families. Improving the quality of child care and the environment in which our children develop is an essential responsibility of our society as a whole, and this legislation can be an important part of our effort in Congress to meet that responsibility.

Today, 65 percent of parents with young children and 79 percent of parents with school age children are in America's workforce. During the working day, 14 million children are cared for by someone other than a parent.

For low-income families and single mothers, child care assistance is a lifeline. Low-income mothers who receive child care assistance are 40 percent more likely to remain employed after 2 years, compared to those who do not receive such support. Yet child care is still unaffordable for far too many families--full-day care can easily cost thousands of dollars a year and become an impossible expense for millions of families.

The Caring for Children Act will expand access to child care and do more to deliver the support that working parents need in obtaining effective child care. The bill supports activities to help parents fmd quality care through State Resource and Referral Centers, so that greater information and outreach to parents will be available.

Child care is a vital support for working parents, and it is also an essential link in preparing young children for school. Research shows that the early environments in which children learn and develop have a profound impact on their later development and on their success in school. Unfortunately, much remains to be done to improve the quality of child care. Nearly half of all kindergarten teachers report that the majority of children in each entering class has specific problems, including difficulty in following directions, lack of even the most basic academic skills, troubled situations at home, or difficulty in relating to other children.

The Caring for Children Act seeks to improve the quality of child care available to low-income children and their families through the Child Care and Development Block Grant. The bill will raise the amount of funds that States must dedicate to quality activities from 4 to 6 percent.

Most important, the Act will promote better child care by focusing on activities that make children ready to learn, and encouraging States to improve child safety and well-being. Funds will be used to provide greater training and support for child care workers, establish voluntary guidelines for school preparedness, and enhance the early learning of young children.

Investments in the child care workforce are also essential to improve the quality of care. Today, only one in

seven child care centers provides a level of quality adequate for child development. Thirty states have no pre-service training requirements for child care workers. Our bill supports professional development and education opportunities for child care providers to upgrade their skills and to use proven and effective early learning materials and teaching strategies in their work. It encourages states to increase the recruitment and retention of qualified child care staff and reduce the high turnover rates in child care centers.

We must also do more to ensure that states provide timely and adequate payments for high quality care. The Caring for Children Act will improve reimbursement rates for care in the states, and more effectively use the market survey required under current law to establish payment rates. I commend Senator Reed for his leadership on those provisions.

Finally, the Caring for Children Act creates a new Federal commitment to serve children in need, including families with infants and toddlers, children with disabilities, and families that require special care during non-traditional work hours. Thanks to Senator Harkin's leadership, the needs of infants and toddlers will continue to be addressed in this bill.

The Caring for Children Act builds on effective practices already underway in many states, but we still have a long way to go to see that all children have access to good child care. More resources are clearly required, and the need is urgent.

In nearly half the states, eligible children are being placed on waiting lists or being turned away altogether. In Massachusetts, over 16,000 low-income children are on waiting lists.

Instead of responding to this need, the President's budget for Fiscal Year 2006 freezes funding for the Child Care and Development Block Grant. Under the Administration's own calculations, 300,000 fewer low- income children will have access to child care assistance by 2010. Surely, we can do better.

It makes no sense to cut back on child care for low-income children. We need to serve as many needy children as possible. I look forward very much to working with our colleagues on the Finance Committee to make that goal a reality as the reauthorization of the Temporary Assistance for Needy Families Block Grant moves forward this year.

I commend Senators Enzi, Alexander, and Dodd for their impressive work on this bill. I urge all of my colleagues in the Senate to support this important legislation and work with us to provide the support for quality child care that low-income families throughout America need and deserve.