Student Right to Know Before You Go Act

Mr. President, I rise to speak about a bill I am introducing today, the United States Job Creation and International Tax Reform Act of 2012. The name says it all. This is a bill that would incentivize American companies to create jobs in the United States while at the same time leveling the playing field for U.S. companies in the global marketplace. This bill would reform and modernize the rules for taxing the global operations of American companies and would help America become a more attractive location to base a business that serves customers all over the world.

Unfortunately, our current tax rules do just the opposite. In fact, many businesses could be better off if they were headquartered outside the United States. That is not right, and Congress should fix it. This bill would do that.

I wish to thank Senator Hatch and members of his staff who have been helpful in working through the complexities of this international tax.

I also wish to mention Eric Oman, a member of my staff and a CPA, who worked with me in developing this legislation. He has lived overseas and worked with the U.S. tax laws overseas. That is the kind of expertise we need to reform international tax law.

I wish to thank all who testified before the Finance Committee, especially Scott Naatjes, who is the vice president and general tax counsel of Cargill. This man has dealt with the complex accounting of foreign earnings and the money to be repatriated to the United States, an actual practitioner whom we relied on. He gave us insight into years of records that have to be reviewed for a single item in the complex web of the current international tax system in order to bring the money back to the United States.

Finally, I wish to thank Dave Camp, the chairman of the House, Ways, and Means Committee, who kick-started the discussion on tax reform when he released his discussion draft last October.

Enacted in the 1960s, our current international tax rules have passed their expiration date. Many of the U.S. major trading partners, including Canada, Japan, the United Kingdom, and most of Europe have moved to what are called territorial tax systems. That is actually a word for a global tax system. These types of tax systems tax the income generated within their borders and exempt foreign earnings from tax.

The United States, on the other hand, taxes the worldwide income of U.S. companies and provides deferral of the U.S. tax until the foreign earnings are brought home. Deferral of the tax until the earnings are brought home encourages them not to bring the money home. It actually incentivizes them to leave their money abroad and to expand over there. Because the United States has nearly the highest corporate tax rate in the world, companies don't bring those earnings back and, as I said, reinvest outside the United States. That certainly is not a recipe for U.S. growth and U.S. job creation.

The dominance of U.S.-headquartered companies in the global marketplace is waning. Thirty-six percent of the Fortune Global 500 companies were headquartered in the United States in 2000. In 2009, that number dropped to 28 percent. That is from 36 percent to 28 percent among the Fortune Global 500 companies headquartered in the United States. Clearly, America is losing ground and our current international tax rules are a big part of the problem.

The bill I am introducing would help to right the ship by pulling our international tax rules into the 21st century so U.S. companies are not at a competitive disadvantage with foreign companies because of American tax rules that are outdated by changes most other countries have already made. The bill would give U.S. companies incentives to create jobs in the United States and undertake activities in the United States in order to win globally.

First, if the foreign earnings have already been subject to a tax in a foreign country, this bill would provide a 95-percent exemption from the U.S. tax on those foreign earnings. This would allow for American- managed capital to be put to the most productive use and help stabilize our economy.

Second, this bill would allow foreign earnings that are currently sitting overseas to be brought back to America at a reduced rate--not a zero tax rate but a greatly reduced rate--and with the ability to pay that, the taxes that are owed in installments. That gets the cash back now and still gets some taxation for us instead of leaving it all overseas. This provision would serve as a transition to the new territorial system by allowing U.S. companies to unlock a significant amount of capital currently being held offshore and quickly move into the new territorial system, and that means more jobs and a better economy. It also emphasizes one of the things I talk about with any of the tax changes--as one of the few accountants--we have to transition into these things if we want the companies stable enough that they can exist through the change in the Tax Code, and that provides for a transition as well.

Third, this bill would reduce the U.S. tax burden on income generated by American companies from ideas and innovations. This bill would encourage companies to develop and keep rights to ideas and inventions in the United States. When families tune in to ``60 Minutes'' on Sunday evenings, they would hear fewer stories about how U.S. companies are moving their profits to tax haven countries and avoiding U.S. tax on those earnings. Families would hear fewer stories about how the U.S. multinational companies set up post office boxes in the Cayman Islands and Switzerland without a single employee or officer of the company anywhere on site and attribute a significant portion of their foreign earnings to those jurisdictions.

Instead, families would hear more stories about how U.S. companies are generating the ideas and inventions of tomorrow right here in America.

This bill can be a first step in tax reform. We have a lot of work to do in many other areas of tax law in order to make it simpler, fairer, and more transparent. We need to be looking at the individual tax system, the corporate tax system, and particularly how we tax the passthrough entities such as partnerships and S corporations that have to pay the tax on the money when it is still invested in the business.

I also recognize, as we move forward in these other areas, it may be appropriate to make changes to this bill. This is exactly how the legislative process should work, and I look forward to getting back to conducting the Senate's business in regular order, where we work through the issues in the committee first and offer amendments to improve the bills that ultimately come to the Senate floor, where there is a shot for everybody else to make amendments.

But today with the introduction of this bill, we move from discussion to action with respect to a single piece of the tax reform. The Simpson-Bowles deficit commission recommended a move to a territorial system, and I am glad to be moving the conversation forward on this recommendation with the introduction of this bill. I hope this bill will begin a discussion, a discussion of fairness that needs to begin yesterday.

I hope Members and their staff will review the bill and the detailed explanation we have prepared. I also ask that all interested stakeholders review the bill and reach out to my staff and the staff of the Finance Committee to discuss what they like, what they don't like, and their suggestions for improvements. That is the way bills are supposed to work.

The international tax rules are not easy or simple and reforming them will be a heavy lift. But those things are worth doing, and when they are worth doing, they are rarely easy or simple.

I look forward to joining with my colleagues to pass international tax reforms that our American companies and our country desperately need.

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

Mr. President, 1 week ago we passed a very important good government bill, the one that would make sure Members of Congress cannot benefit from insider trading information. I added to that an amendment that I think is a good government amendment. It calls for people who are involved in political intelligence gathering--we don't hear much about that profession, but it is quite a business. I asked that they be registered just like lobbyists are registered, and I would like to speak to the point of why that is very important and why it is important to bring it to the Senate's attention, even though it passed by a vote of 60 to 39 just a few days ago.

In the dark of night on Tuesday of this week, the House released its version of the insider trading bill that goes by the acronym STOCK, which wiped out any chance of meaningful transparency for the political intelligence industry. Think about the chutzpah of the people in the House of Representatives--a small group of people--taking out the language I put in that bill when similar language is cosponsored by 288 Members of the House of Representatives, but it happened. So that bill is coming back without the Grassley amendment on it, and we need to think about what we are going to do if we believe in good government, and if we believe there ought to be more transparency in government.

What we are faced with is a powerful industry that works in the shadows--

economic espionage. They don't want people to know what they do or whom they work for. They are basically afraid of sunlight, I would guess. My amendment was adopted in the Senate on a very bipartisan basis, kind of a rare occurrence today. It simply requires registration for lobbyists who seek information from Congress in order to trade on that information.

So isn't it very straightforward if trades are taking place based upon ``political intelligence''--that is their word, ``economic espionage'' is my word--obtained from Congress or the executive branch, people in this country should know who is gathering such information. Not requiring political intelligence professionals to register and disclose their contacts with government officials is a very gaping loophole that my amendment fixes. In fact, political intelligence firms actually brag about this loophole, and I will give an example about that bragging. This is on the Web site of an organization called the Open Source Intelligence Group, a political intelligence firm:

Our political intelligence operation differs from standard

`lobbying' in that the OSINT Group is not looking to

influence legislation on behalf of clients, but rather

provide unique `monitoring' of information through our

personal relationships between lawmakers, staffers, and

lobbyists.

Providing this service for clients who do not want their

interest in an issue publicly known is an activity that does

not need to be reported under the Lobbying Disclosure Act,

thus providing an additional layer of confidentially for our

clients.

This service is ideal for companies seeking competitive

advantage by allowing a client's interest to remain

confidential . . .

Think about the words ``personal relationships,'' ``confidentiality.'' Basically, what they are saying is do all this under the radar.

I wish to go back, if you didn't hear it the first time, let me repeat some of this for you, a much shorter quote:

Providing this service for clients who do not want their

interests in an issue publicly known is an activity that does

not need to be reported under the Lobbying Disclosure Act,

thus providing an additional layer of confidentiality for our

clients.

We have it here on paper, and I just read it to you. This firm-- probably one of many firms; I don't know how many firms are doing this--is telling potential clients: If you don't want anybody to know what you are asking of Federal officials, hire us. That is wrong, but that is why firms such as this don't want to register. If someone on Wall Street is trying to make money off conversations they had with Senators or staff, we should know who they are. It is that plain and simple.

Since the passage of my amendment, which would require political intelligence lobbyists to register as lobbyists, I have heard a great deal of ``concern'' from the lobbying community. Political intelligence professionals have claimed they should do their business in secret for several reasons.

Now, this is the explanation of why they need secrecy. First, they have said if they are required to register, they will no longer be able to sell information to their clients because people will not want to hire them. That makes me wonder, what do they have to hide?

Second, they have said many of them have large numbers of clients, and it would take them a lot of time to register these large numbers of secret clients. Again, that makes me think we actually need more transparency to find out who are all of these people buying intelligence information.

Third, they have claimed it would not address the so-called ``20- percent loophole'' that allows people who spend less than 20 percent of their time lobbying from having to register under existing laws as lobbyists. Not too many people know of that 20-percent loophole, but that is a pretty big loophole. A person can lobby, but they don't have to register if they don't spend more than 20 percent of their time on it. Well, on this issue I have some good news for these people. We don't make the mistake that caused the 20-percent loophole. My amendment requires anyone who makes a political intelligence contact to have to register. No loopholes, no deals, no special treatment, just everyone registers.

Finally, I just want to assure people, particularly journalists, that they would not have to register. Now, that information has been floating around, and it has been floating around that some constituents looking for information in order to make a business decision might have to register. Not so. Only political intelligence brokers, people who seek information so others can trade securities, would have to register.

As I said before, if people want to trade stocks from what we do in Congress, we should know who they are. After all, the basic underlying piece of legislation prohibits Members of Congress from having insider trading information and profiting from it. We ought to know with whom we are dealing. The American people deserve a little sunshine from this industry and on this industry.

Last night, the House turned away from transparency. They supported the status quo. What we need is a full and open conference process so we can take up this very important issue once again that the House believes was somehow not very important, even though 288 Members of the House of Representatives--that is two-thirds of the House of Representatives--have signed on to this principle that these people ought to register. We can take that up then in conference, both the House and Senate, working together.

Is every word in this bill the way it ought to be? If somebody wants to point out some things that ought to be changed, I am open to that. But don't forget, 288 people in the House have signed on. It can't be too bad.

So if we don't get to conference or if we have to debate this again on the floor of the Senate, we might not get 60 votes again. So I worry we will miss the best opportunity we have had for openness and transparency in years.

I yield the floor.

Mr. President, when our Nation's economy was thriving, Nevada was at the heart of the construction boom. Buildings and homes were going up across the State. Neighborhoods were growing, schools were being built at record rates, and the construction industry was flourishing. All of this activity drove investments into other areas of the economy, and for many life was good in Nevada. But when the crisis hit, the highs that my State experienced were matched by the lows that followed.

Nevada now leads the Nation in unemployment with more than 160,000 Nevadans looking for a job. Many can no longer afford their homes. Nevadans are being forced into bankruptcy and facing foreclosure. While Nevada is home to some of the most resilient, hard-working people in the country, almost one-quarter of Nevadans are so frustrated that they have simply given up hope for better employment.

Much of the difficulty Nevadans are experiencing can be traced back to the crisis in my State. The ill effects of the depressed housing market are widespread. High rates of foreclosures are devastating to families, neighborhoods, and entire communities. Families who have been foreclosed upon are already having a hard time paying their bills. Add to those difficulties the time spent finding a new place and the costs of moving and their problems are compounded. Time spent fighting the bank to avoid foreclosure and relocating would likely be better used to find a job or better paying employment.

One of the biggest problems distressed home owners are facing is the programs that have been put into place to help keep people in their homes that have not lived up to expectations. My office spends a great deal of time with Nevadans on the cusp of losing their homes, looking for help, and trying to keep families in their homes. It is truly heart wrenching to hear some of these stories. These homeowners do not want to foreclose, and obviously they do not want to lose their homes.

I recently received this e-mail from a constituent in Reno who is fighting to keep their home. I would like to share that with you.

We hoped for a win-win situation but in the end all we got

was a nightmare in which everyone loses: my sister and I

obviously lose, our neighborhood loses as another house sits

vacant with a rusting metal sign in the front, our State

loses as the housing plight increases again, the bank loses

because they lose a customer who just needed another chance

and, most importantly, democracy loses as the plutocrats roll

over another family.

When families move, their children often have to change schools. So now not only are children forced to move from their homes, they are also leaving behind their schools and their neighborhoods. This kind of destabilization is harmful for families who are already struggling.

Consider the effects of foreclosures on neighborhoods and communities. The widespread availability of housing is flooding the real estate inventory in Nevada. This is forcing down home values and making it difficult for other people to sell their homes as well. In February 2006 the average home in Nevada was valued at $309,000. Today the home values have dropped to $120,000.

Homes left vacant and uncared for can quickly become an eyesore, pushing low home values even lower. This means others in the neighborhood can have a difficult time selling their homes if they want to move. If they find a better job elsewhere, for example, they may not be able to take it because they cannot sell their homes for a reasonable price, if they are able to sell them at all.

Today I am introducing legislation to help reverse these destabilizing forces. The bill I am introducing today, the Keeping Families in their Home Act, will help address large unsold housing inventories and give families a chance to stay in their homes. This bill would allow banks, Fannie Mae and Freddie Mac, to enter into long- term leases, including an option to purchase properties acquired through foreclosure with the prior homeowner or any individual.

By providing an opportunity for the homeowner to stay in their home, the bank is giving families a chance to regain sound financial footing. This commonsense solution helps provide some much needed stability is available for all families.

While I believe this bill is a good step in the right direction, let me be clear: much more needs to be done to help the housing problems facing Nevada. The programs already in place simply have not done enough and have not lived up to expectations.

I was pleased to see reports of growth in our economy, but people in my State continue to suffer. Back home Nevadans still believe there are no jobs. Small businesses are trying to survive while gridlock in Washington is making it harder for employers to know what is expected in the coming year. Crushing regulations are bringing Nevada's growth industries to a halt. In order for Nevada to experience real long-term recovery, Washington needs to fundamentally change the way it works. Congress needs to stop overspending. Republicans and Democrats should come together to close unfair loopholes and make the Tax Code easier for businesses to understand and to follow. This bill is just one solution to help turn around this housing crisis. It is also an idea that both Republicans and Democrats can support.

I look forward to working with my colleagues to pass this bill and others into law so that we can help families dealing with foreclosures across the country. As I have said before, moving forward I welcome any and all ideas on how to fix the housing crisis in this country. Nevadans cannot afford to wait any longer.

In the meantime, I urge my colleagues to seriously consider supporting this bill. This legislation can go a long way toward helping families, stabilizing neighborhoods, and stem

any further reduction in home prices. I hope Senators will join me in this endeavor so the President can sign this bill into law and help families who badly need it.

Mr. President, today I am introducing the Small Business Start-up Support Act of 2012, legislation that will promote small business growth in my home state of West Virginia, and around the country.

Since the recession, I have met with countless business owners, as well as those who dream of starting a small business. One of the common themes of these conversations is the difficulty these individuals have raising capital, particularly when a business is in its infancy.

This legislation helps those individuals out, by expanding a successful provision of the tax code that allows business owners to deduct up to $5,000 of start-up costs. These start-up costs are things like legal and marketing costs that are necessary to get a business up and running, but put a strain on an already tight budget. My bill would expand this deduction so that individuals can deduct up to $10,000 of start-up costs.

For a business to survive, and thrive, its owner has to do their homework during its infancy. They have to study things like supply chains and distribution models. They have to develop marketing plans. Each of these things has a cost that is incurred before a business makes dollar one. That is when a business owner is most in need of assistance and that is why this credit was first enacted.

A temporary expansion of the start-up deduction was enacted in 2008, and it was one of many actions this Congress took to help business owners weather the recession and keep their doors open. President Obama included a permanent extension of this provision in his ``Startup America'' legislative agenda and I am committed to seeing it become law.

I ask my colleagues to join me in supporting this important legislation and thank the chair for allowing me to speak on this issue.

Mr. President, when we went to college, usually things were different. Often a student took out a loan, but those loans were manageable, and usually there were jobs waiting. Today, too often that is not the case. In fact, the students today who take out loans will leave school weighed down, on average, with $25,000 worth of debt. They are going to be trying to get into a labor market where there are more than four unemployed Americans for every available job.

It has been noted that for the first time student loan debt exceeds credit card debt, and that now totals over $100 billion. Now, clearly, investment in higher education is an economic imperative. Education is the great equalizer. It enables upward economic mobility, and it breaks down class structures that impair many countries' ability to grow their economies. A highly-skilled and educated workforce is the basis for a healthy economy, and it is the linchpin to our economic future.