A bill to prohibit direct foreign assistance to the Government of Egypt until the President makes certain certifications related to treatment of nongovernmental organization workers, and for other purposes.

I thank the chairman.

Mr. President, we are going to resume debate today on the postal reform legislation our committee, on which the Presiding Officer serves, has worked very hard to produce and to do so in a bipartisan way. As Chairman Lieberman has indicated, last week, we labored very hard to produce a list of amendments that will allow Members to work their will on this legislation.

There are many different viewpoints on the path forward for the Postal Service, but there can be no doubt about one fact: The Postal Service has lost more than $13 billion in the last 2 years. Despite being relieved from a payment that is required under law toward the health benefits of future retirees, it still lost billions of dollars. If we fail to act, if we turn down this bill, the Postal Service will not survive as we know it today, and that is a fact. The Postal Service, later this year, will have great difficulty even meeting its payroll if we do not act. The Postal Service will max out on its credit that it can borrow from the Treasury if we do not act. The Postal Service will be forced to resort to dramatic and Draconian service cuts that will drive still more customers from the system if we do not act. So just closing our eyes and pretending somehow the Postal Service will find a way through this, without our legislation, is not a realistic option.

As I have indicated, there are a variety of views on both sides of the aisle on what the appropriate path forward should be, and we will have a vigorous debate today--we started it last week--on what the best option is for the Postal Service. For me, the bottom line is this: The Postal Service will not survive if it pursues a course that risks alienating the remaining customers it does have. So resorting to widespread closures of postal processing plants, which would essentially do away with overnight delivery of mail, and raising prices so big mailers pursue alternatives to using the Postal Service for delivery are not the solutions to the Postal Service's woes.

On the other hand, the Postal Service clearly cannot continue to do business as usual. It has to innovate. It has to look for new sources of revenue, and we have given some very specific ideas in our bill by allowing, for example, the Postal Service to provide services and share space with Federal, State, and local governments and to also ship beer and wine with a signature from the customer, just as its competitors, FedEx and UPS--United Parcel Service--are able to do. We also do not prohibit the closure of all post offices, nor do we mandate a certain number be closed; instead, we set standards. We set service standards, and those service standards would govern the decisions the Postal Service would make. I think that is the appropriate way to approach the very difficult issue of how to reduce the infrastructure of the Postal Service.

But the fact remains--and it is a painful fact--that 80 percent of the Postal Service's budget is workforce related. It is always difficult to recognize when a workforce, particularly one as dedicated as the American Postal Service workforce, is simply too big

for the volume of work the Postal Service now has. But there are compassionate ways to deal with this workforce problem, and our bill allows for a refund of an $11 billion overpayment the Postal Service has made to the Federal Employees Retirement System--known as the FERS system. This is an overpayment that has been verified by an independent board of private actuaries the Office of Personnel Management relies upon. It has also been verified by the Government Accountability Office. This overpayment, in part, can be used and would be directed to be used by the Postmaster General to offer retirement incentives and buyouts up to and capped at $25,000, the exact same number that is used in buyouts in Federal agencies to reduce the workforce.

More than one-third of the Postal Service's employees are eligible for retirement today. That is why the Postmaster General believes, if he provides a bit of an incentive, he can reduce the size of the Postal Service workforce by more than 100,000 workers. That is about 18 percent of the entire workforce. That approach of using retirement incentives, buyouts, and incentives such as that is very similar to the approach the private sector uses, that large corporations use when they are faced with the painful task of having to downsize their workforce.

The rest of the overpayment refund would be used to pay down debt, something the Postal Service desperately needs to do as it approaches that $15 billion line-of-credit cap.

I wish to stress--because there is going to be a lot of discussion about this, perhaps very shortly--these are not tax dollars being refunded to the Postal Service. I read from a letter from the inspector general on the floor last week that verifies the revenues for the FERS payment come from two sources: They come from the postal employees themselves who contribute to the FERS system, and the revenues come from the Postal Service's own revenues, which are from selling stamps, mailing packages, and the other services the Postal Service provides.

This is not a taxpayer bailout. It is not a refund of taxpayer dollars. This is a refund of a substantial overpayment of money from the Postal Service's employees and the Postal Service itself, from revenues it generated, to the FERS system that never should have occurred. That is another whole issue--of how it occurred. This overpayment has been confirmed by the GAO and by an independent board of actuaries hired by the Office of Personnel Management.

That is a very important part of this bill. If the Postmaster General is successful--as I believe he will be if he aggressively implements these provisions in compassionately reducing the size of the workforce--the estimates are that provision alone would save about $8 billion a year, and it would allow the Postmaster General to right size many of the processing plants. Some of the processing plants are too big for the volume they now have.

But the answer is not to close them altogether because that has such a detrimental impact on the delivery of mail, and that leaves rural America behind. That would result in there no longer being overnight delivery for first-class mail.

Let me give an example from my State, where the Postmaster General has unwisely proposed closing one of only two processing plants we have in a State as large as the State of Maine. He would keep the one in the southernmost tip of the State but close the one in Hampden, ME, which serves northern, central and eastern and parts of western Maine. It serves about two-thirds of the geography of the State. If that postal processing plant were to close, mail from northern Maine--being sent from one community in northern Maine to another--would have to undergo a more than 600-mile round trip to the one remaining processing plant in Maine. I can't imagine how many days that would take, but I am certain it would cause people to stop using the mail, and, thus, revenue would decline still further because there would be no possibility of overnight delivery of bill payments, for example, or bill delivery.

This is not the answer. So what is the answer? That plant could be downsized, not closed. We need to preserve the service.

If the plant is too large now for the volume of mail that goes through the plant, why doesn't the Postal Service rent out part of the plant? I am sure a mailer in the area--perhaps several mailers in the area--would welcome the opportunity to rent space in that building and be right next to the postal processing plant. That would work very well.

There are so many options, but the Postmaster General, in my view, has not pursued those options. When it comes to rural post offices, there are so many options. For example, a post office could be open in a rural community, say, from 7:00 to 9:00 in the morning and 5:00 to 7:00 at night so that individuals going to and from work could stop and do their business, but the Postal Service would still be able to save funds by not having the post office open the entire day. A small post office could be colocated in a retail facility--the local pharmacy, perhaps, or the local grocery store.

There are possibilities which need to be explored--and which our bill directs the Postmaster General to explore--in order to avoid the widespread closure of post offices in rural America that will have a detrimental impact on the individuals and the businesses located there. Our bill in essence forces more creativity on the Postal Service by again setting standards with the Postal Regulatory Commission, which is the regulator in this case, and then ensuring that the actions of the Postal Service with regard to infrastructure meet those standards.

This bill has many other provisions that we discussed at length last week, so I am not going to repeat them now, but let me reiterate the point I made at the beginning of my remarks.

We have been able to negotiate, with the cooperation of both the majority leader and the Republican leader and with a lot of hard work by the members of the committee and the floor staff and our staff, a very fair process that will allow many amendments to be offered, expressing a wide variety of philosophies and views on the proper road ahead. But what we cannot do is fail to act. If we do not act, that will be a death sentence for the Postal Service--an American institution enshrined in our Constitution that is the linchpin of a $1 trillion mailing industry that employs 8.7 million Americans.

This debate is not just about rural post offices, important though they are. It is about our economy and not delivering a death blow to an institution that is the center of much of our economy. I hope Members keep that in mind as they come to the floor with proposals, for example, to essentially privatize the Postal Service or to do away with most of its infrastructure because if those amendments prevail, they will deliver a crushing blow to our economy at a time when we can least afford it, and they will jeopardize that trillion-dollar mailing industry that includes everything from paper manufacturers, to magazine publishers, to newspapers, to financial services--all of these industries that are so dependent on the U.S. Postal Service--and that is an outcome we must avoid.

Mr. President, I suggest the absence of a quorum, but I will be responding.

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

Mr. President, let me start by responding to the ranking member of the Budget Committee by saying that I could not agree with him

more that it is absolutely unacceptable that we have not had a budget passed in the Senate for more than 1,000 days. That is totally unacceptable. It is one of the reasons we are in such a financial crisis in this country. So I completely agree with Senator Sessions that we should be doing a budget resolution on the Senate floor, and I wholeheartedly agree with his comments that it is absolutely irresponsible for us to be proceeding without a budget resolution. And as a member of the Appropriations Committee, I would say to my colleagues that it makes it very difficult for us to carry out our work. Due to the cooperation of the chairman and ranking member of that committee, we are operating under allocations for each subcommittee, but it would be far preferable if there were a budget resolution that passed, and it should have passed last year, the year before, and it should be passed this year. So we are in complete agreement on that point, and I know that has been a great source of frustration for the Senator from Alabama as the ranking member of the Budget Committee.

Having said that, let me explain a few facts. First of all, there are no tax dollars being authorized by this reform bill. There is no transfer of taxpayer money to the Postal Service. What we have here is a very strange and unusual budget situation. And the score CBO has is incredibly misleading because the Postal Service, oddly enough, is part of the unified budget of the United States even though most of its accounts are off-budget, but it participates in Federal employee retirement systems and the health benefits systems and the workers' compensation systems, where postal dollars that come from postal employees and from postal ratepayers are commingled, if you will, with tax dollars that come from other Federal agencies into the retirement system, the workers' comp system, and the health benefits system. And that creates this odd situation, which makes it very difficult for CBO to score this bill correctly.

The inspector general of the Postal Service puts it far more bluntly. In a February 22 report from this year called ``Budget Enforcement Procedures and the Postal Service,'' the inspector general said:

. . . the Postal Service's off-budget status . . . expose[s]

the Postal Service to an inappropriate and illogical

application of the scoring process that threatens its ability

to reform and heal its financial condition. Scoring and

budget enforcement were created for a good purpose, but they

are undermined when the scoring process assumes that unlikely

or inappropriate inflows to the Treasury must occur.

Let me give you a couple of examples because it is incredibly important that we walk through the score so that our colleagues can understand the unique on-budget/off-budget status of the Postal Service, particularly in the area of reducing payments to retiree health benefits or recovering overpayments to the FERS system and how the CBO scoring method obscures the true savings achieved by refunding the FERS payments.

Again, let me repeat that since 1971 the Postal Service has received no Federal subsidy to operate other than some very minor appropriated dollars for functions that the Postal Service is legislatively mandated to do, such as mail for the blind and overseas ballots for our troops. That is it. Prior to 1971 there was a taxpayer subsidy year after year to the Postal Service, but that ended with the Postal Reform Act in that year. So from the sale of stamps, the cost of shipping packages, and the rates mailers and magazine publishers and newspaper publishers pay to get the print versions delivered comes the revenue for the Postal Service. And even the money the Postal Service uses for retiree benefits comes from a combination of the contributions the postal workers make and the money the Postal Service invests.

As I mentioned earlier, there is a significant overpayment into the Federal Employees Retirement System, and we, along with the administration, the GAO, the independent actuaries, and the Postal Service inspector general, have all proposed that overpayment be returned to the Postal Service, and it would be used in part to finance these buyouts and retirement incentives to reduce the size of the postal workforce.

Let's look at how CBO scores this particular part of the bill.

First of all, CBO gives this bill no credit whatsoever for the buyouts, and here is why: CBO argues that the Postal Service already has buyout authority, but as the Presiding Officer knows better than anybody in this Chamber, our bill changes the status quo in two critical ways. First of all, the Postal Service has no cash right now to do these buyouts. That is one of the reasons we are so eager to get the money from the overpayment of FERS refunded to the Postal Service. Second, in our substitute bill, we specifically direct the Postmaster General to use a portion of this money to entice 18 percent of the current postal workers to accept this offer. That is a big difference. So there is a mandatory direction to the Postmaster General to reduce the workforce by about 18 percent and there is the cash that will allow him to offer buyouts to do that. Why CBO doesn't score that as a savings to the Postal Service is beyond me.

There is another way to reduce the workforce and, again, the funds for this would come from the FERS refund. Our bill provides new authority to the Postal Service to offer 1 or 2 years of credited service toward a pension annuity so that for a worker who is just lacking a year or two to reach the number of years necessary for retirement could be credited with that extra year or two of service, depending on which retirement system the worker is in. Unfortunately, the CBO makes an assumption that only several thousand employees would take advantage of that offer and credits the bill with savings of only $643 million over 10 years. Since these kinds of service credits have never been offered before, it is not clear how the CBO came up with this assumption. There is no precedent for it. There is no data for the CBO to use. Again, our original bill did not include the hard requirement for the 18-percent reduction, but our substitute does. Yet CBO does not recognize that change.

The Postal Service has told us, as the Presiding Officer would attest, these requirements and this new authority and the funds for the buyouts and the service credit would allow them to reduce their workforce in the neighborhood of 100,000 employees and save some $8 billion a year. That is not reflected in the estimate. I use that example because it shows how strange the scoring is. This is a quirk of the budget-scoring rules because when there is a transfer of Postal Service money--not taxpayer money, Postal Service money--from one account in the Treasury, such as the retirement account, into an off- budget postal operations account, the CBO makes this assumption that savings are not going to occur. So when we transfer the $11 billion overpayment--the refund--from the pension account, to which the Postal Service has been overcharged, into a postal operating account, it gets credited as $5.5 billion instead of $11 billion. That means an on- budget account loses $11 billion, as CBO looks at it, and the off- budget account only gains $5.5 billion. This is very complex because it is so obscure and because, frankly, it is so illogical. The result is the net score in the unified budget of $5.5 billion as a cost to the Treasury, and that simply is not the reality. Again, these are not taxpayer dollars that went into the overpayment in the first place. So here we have a provision that is being scored as the $5.5 billion cost to the Treasury when, in fact, they aren't tax dollars, and it is only because this is a unified budget, where some of the accounts are on- budget and some of the accounts are off-budget, that we have this anomalous result. It doesn't make sense.

Let me give my colleagues another example. The CBO acknowledges that our reforms of the Federal Workers' Compensation Program would save $1.2 billion, but CBO doesn't count this reduction as a savings because of the way the Department of Labor charges agencies for participation in the workers' compensation program. Again, that doesn't make any sense, when the CBO itself acknowledges that these are real reforms that are going to save $1.2 billion. Yet we only get credit for $200 million of the reforms.

There is another issue. The CBO does not account for what would happen if the Postal Service allows service to continue to deteriorate because the CBO doesn't recognize the reality that all the big mailers and small mailers tell us, which is that revenue will be driven out of the system if the service

cuts associated with plant closures and wholesale closures of post offices are allowed to proceed. The bottom line is that were it not for 50-percent discounts being applied over and over to the savings we achieve for 5-day delivery, retiree health care, the pension refund, on the basis of these strange behavioral assumptions and reflecting the odd combination of off-budget and on-budget accounts being brought together in a unified budget, the bill would have scored approximately $24.6 billion more in off-budget savings, making the bill a net saver of $14.8 billion.

This is so frustrating because it is so complex, but I think if our colleagues look at the example of the FERS overpayment, it becomes very clear because there are no taxpayer dollars involved. Yet it is scored as a cost to the Treasury of $5.5 billion. How can a refund of an overpayment that involves no tax dollars end up being scored as a cost to the Treasury of $5.5 billion? That is how illogical and quirky this estimate is, and it is because of the unique status of the Postal Service and how its various accounts are reflected in the budget.

In addition to my absolute conviction that this score is very misleading, let me make another point. If we do not proceed with this bill--if this budget point of order brings down this bill--the Postal Service will not survive as we know it. Again, we are not providing a taxpayer subsidy in this bill. In fact, I would argue we are preventing a taxpayer bailout in this bill because later this year, if the Postal Service cannot meet its payroll and thus is unable to deliver mail, I think the pressure for the taxpayer bailout will increase substantially, and I do not want to see us return to the pre-1971 era, where the taxpayers were on the hook for the Postal Service. Our bill would avoid that outcome.

Thank you. I suggest the absence of a quorum.

Mr. President, I too wish to commend the Senator from Virginia for offering this amendment in conjunction with the Senator from Maryland. I wrote to OPM in July of last year about this very issue. I was very concerned about reports in my own State and from the Washington Post about the tremendous backlog at OPM in processing the retirement applications of Federal and postal workers, and this is just wrong.

As the Senator's statement shows, it has caused some real hardship to individuals. So I was pleased the chairman and I could work with the Senator to modify his amendment so it would be germane to this bill. I look forward, at the appropriate time, to working with the chairman to accept the amendment.

Mr. President, it has been announced by the clerk that the Senate is now considering the motion to proceed to S. 1925, the Violence Against Women Reauthorization Act.

At 2 p.m. this afternoon, the Republican leader or his designee will move to proceed to S.J. Res. 36, a resolution of disapproval regarding the NLRB election rule. The time until 4 p.m. will be equally divided and controlled between the two leaders or their designees.

At 5 p.m., the Senate will proceed to executive session to consider the nomination of Brian Wimes to be a U.S. district judge in Missouri. There will be a rollcall vote on confirmation of the Wimes nomination at 5:30 p.m.

Postal Reform

Mr. President, as you and our colleagues know, after a lot of work and good-faith negotiations, we reached a bipartisan agreement last week to complete action on the bipartisan postal reform bill tomorrow, with an agreement that includes almost 40 amendments--39, I believe, is the number--to be voted on tomorrow.

Although, we--and particularly our staffs--have been working with sponsors of the amendments, we expect that probably more than half of them will be negotiated to agreements, modified, and/or accepted. But there still will be a significant number of rollcall votes,

which will begin tomorrow afternoon after the respective party caucuses.

There was a good amount of debate on the postal bill last week. Tomorrow, once we go from S.J. Res. 36, the resolution on the NLRB election rule, to the postal bill in the afternoon to begin voting on the amendments, there will not be much time for debate.

As announced last week, last Thursday after this agreement was achieved, Senator Collins will be here from now until 2 p.m. when we go to the NLRB rule. We will be here from 4 to 5, the next open block before we go to the judicial nomination, and we are prepared to stay this evening after the judicial nomination for as long as proponents or discussants of the various amendments want to come to the floor to engage in debate and discussion on them. I hope our colleagues will do that.

As Senator Reid said, this is an important piece of legislation. Nobody denies that the U.S. Postal Service is an iconic American institution which millions of people depend on not just for the mail but for their jobs, both directly working for the Postal Service and indirectly--but not too indirectly because they work for related businesses that depend on the mail.

We simply can't turn aside, do nothing, and let the Postal Service continue a fiscal spiral downward. The Postal Service, as we said over and over last week, lost $13 billion in the last 2 years. It is going to go over its debt limit later this year. The Postmaster has been very clear that if we don't give him some authority to find a new business model, to economize, he will have to take very aggressive action, potentially closing--on one list he put out there were 3,700 post offices and approximately 250 mail processing facilities, which would be extremely disruptive both to the post office and to the personal life and commercial life of our country.

This bill Senator Collins and I, along with Senators Carper and Scott Brown, offered to our colleagues offers a sensible but tough way forward to preserve the U.S. Postal Service, but also to acknowledge that it has to change to stay alive forever, certainly through the 21st century. Because of the impact of e-mail, it has dropped the volume of mail in the last 5 years by more than 20 percent. When that kind of revenue is lost, we have to find ways to economize and a different kind of business model, including different ways to raise revenue, all of which is authorized in this bill.

I know some people think our bill doesn't do enough. They are ready to basically close down a lot of the Postal Service as we know it. Some people think our bill does too much. We naturally think we have struck a sweet spot or a point of common ground. In fact, the Postal Service told us they believe if our bill is enacted, it would save--after fully implemented over the next 2, 3 years--between $15 billion and $20 billion a year, to be conservative--probably closer to $15 billion. That is a significant amount of money. It creates a series of incentives to alter the business model of the post office, including authorizing the post office to get into some businesses it has not been in before as a way to take advantage of its unique assets and raise more money.

So this is a moment of truth for the Senate. In some sense, it is a somewhat smaller version of the larger moment of truth we are going to have to face sometime about our Federal budget overall, but here is a great American institution that is in real fiscal trouble.

We have the ability with this legislation to get it back on a path of balance, stability, and even growth. Some post offices will be changed under this bill. Mail processing facilities--some of them will be closed. The Postmaster says he wants to have that happen.

We have authorized a significant amount of money to be spent to incentivize 100,000 postal employees to retire. They are eligible for retirement with an incentive. We think they will, and that itself would save the Postal Service approximately $8 billion a year.

This is not one of those bills that people enjoy voting on, but it is our responsibility. It is necessary we face the crisis the Postal Service is in and help it stay alive and flourish throughout this century.

That is what is on the line in the bill. The amendments cover a range of topics. This was a very broad bipartisan agreement on the amendments. There are some that make the bill tougher, some make it softer. They all deserve a good debate, and that is what Senator Collins and I are here to do now.

Measure Placed on the Calendar--S. 2327

Mr. President, I understand that S. 2327 is at the desk and due for a second reading.

Mr. President, I object to any further proceedings with respect to the bill.

I yield for my distinguished ranking member, Senator Collins.

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

Mr. President, I thank the Presiding Officer for liberating me from the chair so I may now speak in my capacity as a Senator from the State of Connecticut. First, I would like to thank my friend from Maine, Senator Collins, for what I thought was a very convincing, insightful description and really a critique of the CBO estimate of the financial impact of this bill.

This is tough to follow. The two of us, Senator Collins and I, and others on the committee have been deeply saturated in this for probably too long. But the fact is, when the CBO estimate of the bill came out saying it was going to cost more than we were saving, I was shocked. As I read over it, part of it is because they are not simply considering the Postal Service budget, which we are out to save; that is, to cut a lot of money from it so it can be saved, and as Senator Collins said, the Postal Service is off-budget. It does not spend taxpayers' money except for those two little matters of paying for ballots for military personnel and others overseas, and I think the other is for blind people in this country, but the rest of it is all paid by the ratepayers. So as you go over, one by one, as Senator Collins did, the elements of the ``costs''--and I put quotations around them--they are just not real. This is form over substance. This is a kind of ``Alice in Wonderland'' accounting that does not relate to the reality of the Postal Service's budget or the Federal budget.

The so-called FERS repayment that is coming from the Federal Government, everyone agrees--including Senator Sessions, who stated his intention of making a budget point of order on our Postal Service bill--the Postal Service did overpay this amount of money, just as if a taxpayer overpaid taxes. Well, if I overpay my taxes, that is my money I am asking back from the government. In this case, the Postal Service has overpaid to the Federal retiree pension fund, and it is asking for its money back.

There is something else to be said here about the reality of accounting in the real world. When the approximately $11 billion--or maybe more--is paid back to the Postal Service, that only happens once, when that total is paid back. But what we have demanded in the bill be done with a part of that money, which is to get involved in this incentive for early retirement or retirement when members of the Postal Service are eligible, mandating that 18 percent--about 100,000 postal employees--retire, that saves $8.1 billion on a recurring basis every year. So you have the one-time--it may come in two or three payments but only one-time--$11 billion repayment to the Postal Service for the overpayment it made, and then every year it saves $8.1 billion, forever. That is a pretty good deal both for the taxpayers and the Postal Service.

Secondly--and Senator Collins went on very effectively about this-- the prefunding of health benefits. The fact is in the Postal Reform Act of 2006--you might call it an excess of caution--the Postal Service was required to make payments into the retiree health benefits fund that are greater than most any other business or government in the country. We have just spread this out to a 4-year payment schedule according to the normal discount rate other Federal programs pay for their retirees' benefits.

Senator Collins talked at length about the impact of the way in which the CBO, the Congressional Budget Office, refuses to score--as we say, count--dollar-for-dollar the amount of money saved by early retirements, which does not make any sense because that is what will be saved.

Now, I want to enter into the Record at this point--and speak to it-- the estimate of the U.S. Postal Service about what our substitute amendment to S. 1789 will save, and it is quite dramatic. I ask unanimous consent that it be printed in the Record.

All along, our goal has been to get to a point, over 3 or 4 years, where we would save as close to $20 billion a year as we could. That is the number Postmaster General Donahoe gave to our committee as to what he needed, the Postal Service needed to get back in balance.

On the current course, in fiscal year 2016 the U.S. Postal Service--I am reading now from the statement I have entered into the Record that the Postal Service has given us--will have a deficit of $21.3 billion. In 2016, under the passage of S. 1789 with our substitute amendment, the loss is reduced to $1.8 billion. That is from $21.3 billion to $1.8 billion. Well, of course, we want to get it to total balance, but we are clearly going to hit balance after that on the course we are on. That means, according to the Postal Service, passage of S. 1789 with our substitute amendment will save the Postal Service over $19 billion a year by 2016. That is exactly what the Postal Service needs to stay alive.

We do it without compelling layoffs. We do it with incentives for retirement. We do it without mandating--as some of the amendments would that we will vote on tomorrow--the mass closure of mail-processing facilities or our post offices around the country, which, as Senator Collins said, would be a kind of shock therapy. It would so jolt the system that people would turn away from the post offices in increasing numbers. In fact, it would accelerate the loss of revenue. We do it without an immediate move from 6 days of delivery to 5 days because that is a tough one for a lot of people. We have given the Postal Service 2 years to essentially prove it can get back in balance without that move from 6 days to 5 days of delivery.

We have added new sources of revenue. We have created a process here, which is not scored by the Postal Service, that we think can add more money because it will develop a new business model, a new way to use the assets the Postal Service has to make more money.

The fact is--I want to emphasize this again--this saving of $19 billion, which will result by 2016 if this substitute to S. 1789 is passed, does not take any taxpayer funds. In fact, it properly returns certain overpayments to the Postal Service.

The CBO score for S. 1789 is simply misleading--profoundly misleading--because of the kinds of accounting rules that do not relate to the reality of the budget for the Postal Service.

I am proud of what we have been able to accomplish. It took a lot of work. As Senator Collins has said, if this point of order Senator Sessions intends to make at some point in the debate--hopefully after the amendments are voted on--is sustained, it will end this bill. Instead of, therefore, having passed a bill which, if it goes all the way to enactment, would save $19 billion for the Postal Service every year by 2016, the Postal Service's deficit and debt spiral would continue downward. I would predict there would be massive cutbacks in services and a loss of employment by people in the Postal Service but particularly among the 8 million people who are in jobs that depend on the Postal Service in the private sector for their livelihoods. So with all respect, I will vigorously oppose the point of order my friend from Alabama, Senator Sessions, will make.

Mr. President, I note the presence on the floor of the distinguished Senator from Virginia. Does he wish to speak?

I yield the floor.

Mr. President, I thank my friend from Virginia most importantly for focusing our attention--I know Senator Collins and Senator Akaka have also been involved in this--on this unacceptable situation, where Federal employees are retiring. Because of a lot of failures here, the failure to implement an effective--it is 2012-- electronic system for this purpose, this paper processing, meaning that people have to wait these very long times after they retire, while they are waiting, they are getting a significantly reduced benefit which causes real hardship.

The Senator from Virginia is absolutely right. We mandate in this bill, the underlying bill, that the Postal Service accept the goal of 18 percent in reduction of workforce. The total number of career employees in the U.S. Postal Service is about 545,000, and 18 percent comes out to around 100,000, which is our goal for reduction. This has to happen if the Postal Service is going to get back in balance. Because as Senator Collins said earlier today, 80 percent of the operating budget of the Postal Service is personnel costs. Obviously, it is a labor-intensive operation. So we are going to have another 100,000 people. In fact, it keeps going. By 2017, we will have--from now, this year, we will have a total of 138,000 postal employees eligible to retire. The Postal Service is going to have to work to incentivize them to retire so the service overall can stay in balance.

I wish to thank Senator Warner because we have worked very well together on a modification to his amendment, which I think most significantly will require the Office of Personnel Management to submit a report to Congress related to the completion of retirement claims for postal annuitants, to keep the pressure on them to end this inhumane-- in many cases, unacceptable--situation.

I know when the proper time comes, we intend to support this modified amendment. It strengthens the bill. It does the right thing. I thank the Senator from Virginia for expressing his intention to support the overall bill.

I yield the floor.

The PRESIDING OFFICER (Mr. Udall of New Mexico.) The Senator from Maine.

Mr. President, thanks to the Senator from Virginia. He makes a very important point: Of the $19 billion in savings that the Postal Service itself believes will result annually as of 2016, $8.1 billion will come from the reduction in salaries paid because of retirements that are incentivized under this bill.

It is common sense that if a worker is thinking about retiring and hears there is such a backlog that they are only going to get half of what they deserve for their pension until the paperwork has cleared, they are probably not going to rush to retire, and, therefore, we are going to save less money.

We are approaching the hour of 2. According to the unanimous consent that governs our activities today in the Senate, we are going to go to another matter, the NLRB rule. I wish to thank particularly Senator Sessions and Senator Warner who came to the floor to discuss their amendments. Senator Collins and I will return at 4. We will be here until 5, when we go to the discussion of a judicial nomination. Then, we will be here after the vote tonight as late as anybody is here to discuss and debate amendments before we go to the vote tomorrow.

I thank the Chair. I thank my friend from Maine.

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

Mr. President, first of all, let me thank the chairman and Senator Collins for their work on this bill. I know it has caused a great deal of interest and consternation, but the numbers are overwhelming that without this kind of legislation, the fate of our Postal Service would be in great jeopardy. I commend both the chairman and ranking member for their very good work. I intend to support the legislation. I know they have had to make some hard choices, but I think they are putting the Postal Service back on the path to sustainability, and I commend their leadership.

I also thank them both for an amendment they have been kind enough to include in, I believe, a revised bill, a managers' package, that takes on a related issue that affects not only Postal Service employees but all Federal employees; that is, the absolutely dreadful performance-- which is starting to be corrected, but the absolutely dreadful performance that OPM and agencies of the government, including the Postal Service, have done in terms of making sure our Federal employees receive their retirement benefits in a timely manner.

The Presiding Officer and I, both from the Commonwealth of Virginia, have 130,000 Federal employees in Virginia. There are 140,000 Federal employees across the river in Maryland. I am happy Senator Mikulski has cosponsored the amendment I am going to talk about in a few moments.

I want to explain the problem we are facing and why I am asking the Senate to adopt this amendment during the consideration of this bill to reform the postal system.

Over the past year, I and other Members in both parties have received hundreds of requests for assistance from Federal retirees who have experienced significant delays in obtaining their full retirement benefits--delays that oftentimes exceed 12 months, sometimes as much as 18 months and more. In the meantime, these Federal retirees--and no one questions that they deserve and should receive these benefits, but since there is slow processing and antiquated technology, they are not getting these earned retirement benefits. These retirees face inordinate hardships trying to pay their bills and survive on partial payments made while their retirement paperwork moves through the system.

Remarkably, in 2012, our whole retirement system is still a paper- based system. OPM also relies upon every other Federal agency, such as the post office and others where a Federal employee works, to assemble and submit the retiree's paperwork in a timely and efficient manner. But as we have seen with the occasional snapshots that have been taken, some agencies literally have a 30- to 50-percent error rate in submitting the background material for the retiree so OPM can appropriately process the paperwork.

Part of the goal of this postal reform, I know, is going to be to encourage some of the voluntary retirements in the postal system--again why this amendment is so timely. Meanwhile, the retirees wait and wait for benefits; benefits they have earned, and, unfortunately, benefits they cannot get access to. We continue to hear from recent Federal retirees who literally spend 8 or 10 hours a day trying to get through on the customer service line to find out where their benefits are.

I would like to share a few examples of what we are hearing. We recently heard from a retired colonel from Williamsburg, VA, who wrote, ``I retired in March 2011 and at the time of this writing OPM has still not figured out my full retirement pay . . . my savings are getting low.''

From here in Northern Virginia, in Dumfries, VA, we heard from a retiree who said:

I have been subjected to a severe financial hardship

because of not getting my full benefits. I was recently told

that the bank is repossessing my auto because I cannot afford

to make the payments.

He cannot make the payments because this retiree was not getting her benefits. She was existing on partial benefits until OPM could deal with the processing.

From Warrenton:

I am seeking assistance with obtaining my husband's health

insurance which was canceled unexpectedly. He worked for DOD.

I notified OPM with the appropriate forms and a copy of his

death certificate, all of which was apparently lost by OPM. I

tried to obtain new forms but was told it would take up to 6

weeks. I am 80 years old and need my health insurance now. My

husband and I were married for 60 years.

This is unacceptable. This is not the way we ought to be running this important part of our Federal Government. In January of 2012, OPM's retirement backlog exceeded 62,000 cases--62,000 Federal employees, retirees--who were waiting to get their benefits. Again, let me point out, many of these retirees were waiting for more than 1 year.

We saw huge backlogs in disability claims, death benefits, and quarterly benefits. By OPM's own account, it takes almost 700 days, nearly 2 years, to process some death benefits. Recently, after my meetings with OPM and other members of the delegation, OPM has made some limited progress in reversing the tide of retirement claims. The retirement backlog is now 52,000 claims. OPM has hired new staff and is starting to modernize its outdated processing, but it is clear more needs to be done.

I wish to also compliment Senator Akaka, who was kind enough to let me join an oversight hearing on this matter back in February of this year. What I heard there worried me. So I sent my staff to OPM's retirement processing facility last month to see the problem up close. Unfortunately, my staff's reports confirmed my worst fears. The current process is largely manual, cumbersome, and contributes to significant delays and potential errors. We have been told the newest OPM technology is 12 years old. That is pretty remarkable. It is simply no longer feasible to expect that manual data entry for retirement and benefits claims make sense when we have technology that can dramatically lower processing time and increase accuracy.

OPM needs to modernize its technology in the long run. But in 2012, they need to at least start taking some short-term steps. It is unacceptable that they rely upon paper processing in 2012. OPM, as I mentioned, has made some progress. But ultimately they still want to remain committed to a paper processing system. That does not make any sense. The kicker is this problem is not new. As indicated by this press story, Federal agencies routinely point the finger of blame at OPM for causing these delays, while OPM points the finger back at the individual agencies for not getting the information to OPM in a timely manner.

One might think this story was written in the last few weeks. There have actually been stories written in the Post in the last few weeks about this subject. But the day I am quoting from on this story is actually May 9, 1988. That is 24 years ago. Ronald Reagan was President when this was written, and we have had four Presidents since then. Yet OPM continues to offer the same excuses and the same kind of back-and- forth finger-pointing between agencies. We have seen this show before. It needs to be taken off the air.

What are we going to do with this amendment and how does this affect trying to move the ball forward? My amendment will do three things. First, it requires OPM to report to Congress, GAO, and the public about the timeliness and accuracy of Postal Service claims, requiring OPM to compare the Postal Service with the performance of all other Federal agencies. So we need to figure out, because we do not know at this point--we have a 52,000-claim backlog--whether the backlog is because the agency the employee worked for did not get the information to OPM in a timely manner or whether OPM has not processed this.

This amendment will require the Postal Service to assess how it is doing, getting this information to OPM, and compare that with the performance of other Federal agencies. This will allow us to see which Federal agencies have the best and worst track records in submitting paperwork to OPM. The snapshot we saw a little bit earlier this year at the hearing in February showed that a number of agencies had literally a 30- to 50-percent error rate in submitting their retirement paperwork to OPM.

With close to 100,000 potential new retirees--actually a much larger number, but the effect of this bill may urge the voluntary retirement of 100,000 postal workers to retirement--OPM is going to get hit by a tsunami.

Second, the report will also require OPM to provide a claims aging report. We need to know how long retirement applications have been pending at OPM. By the way, we do not have any of that information right now for the 52,000 cases that are currently pending--no basic aging report.

Third, the amendment will require OPM to at least move forward a little bit in modernizing one piece of their technology, so OPM can at least receive some electronic payroll data from the Postal Service system.

Now, 551,000 people work for the Postal Service right now. If this legislation passes, which I hope it will, and we see the voluntary retirement of 100,000 postal workers over the coming months and years, that is a new tsunami of retirement benefits claims that are going to need to be processed by OPM.

The bottom line is this: OPM, while they are trying to make some progress and I commend Director Berry for some of the actions he has taken, needs to be urged along and we need to get more data about how they do, not only with the Postal Service but with all Federal agencies. My amendment will move forward in that direction.

The Warner-Mikulski amendment focuses on these key reporting requirements and mandates more transparency so we can untangle the chokepoints. I believe we need to honor the dedication and commitment of our Federal workforce, including our postal workers, in making sure that when they do retire, they get their Federal retiree benefits in a timely and efficient manner. Again, I wish to thank the chair and the ranking member for their hard work on this postal reform bill. I look forward to supporting it. I also hope my colleagues will join me in supporting this Warner-Mikulski

amendment that while tangential to the overall reform of the Postal Service, making sure these retirees get their benefits in a timely manner is something on which we should all agree.

I yield the floor.

I want to thank the chair and the ranking member for working with me on this amendment to get it appropriately modified. This an area that I think there is broad bipartisan consensus, that we need to make sure--whether postal workers or other workers in the Federal system--that when they choose to retire, they can expect those retirement benefits in a timely manner.

I wish to again commend the chair and the ranking member for the fact that putting in place this very reasonable plan that is going to encourage the voluntary retirements of that approximate 18 percent of the workforce--109,000 I believe it amounts to--is going to be a lot easier to make that sell if those postal workers can then expect to receive their retirement benefits in a timely manner. I think if they are hearing the current scuttlebutt that they may have to wait 12 to 18 months to get their retirement benefits, it becomes a much harder effort for the Postmaster and the management of the Postal System to make--even if they got the right incentives in place--to kind of get over that hump if they have to wait a long time.

So I very much thank again the chair and ranking member, Senator Lieberman and Senator Collins, for their support, and I think trying to shine a light, not only on the Postal System but vis-a-vis how other Federal agencies are doing will be important. I look forward to working with them. I know they both focused on this issue in the past. I hope to lend my assistance to make sure we get this fixed.

Mr. President, I come to the floor to discuss S. 1789, the 21st Century Postal Service Act. I regret to say there is a fundamental problem with this bill that we have to address. I wish it weren't so, but I am afraid it is. The bill would increase the Federal deficit by $34 billion. This violates the deficit neutrality provisions for spending that we adopted as part of the Budget Control Act just last summer. As a result, there are at least five budget points of order that lie against the bill, and I, the ranking Republican on the Budget Committee, will be raising points of order at the appropriate time. That means it would take 60 votes of our 100 Members in the Senate to say we don't want to agree and follow the law we passed last summer.

Under the Senate rules, no committee can bring a bill to the floor that spends even one penny more than already is going to be spent under the current law or increases the deficit more than it would increase under current law. Current law is the Budget Control Act of last summer, and it was passed, as we all recall, as part of a major debate over raising the debt ceiling, so we could continue to borrow money. Borrowing at the rate of--about 40 cents of every dollar we spend.

In August we agreed to modest, though insufficient savings. Although we talked about big cuts, we only managed to reduce the growth in spending, not the actual level. The debt deal established basic spending limits. Not one word in that law prevents us or any Member of Congress from saving more. The law set the maximum, not the minimum, that we can spend.

But this bill violates that legislation. It spends above the agreed- upon limits. Only in Washington does spending below a limit get one accused of breaking a deal while spending more than the agreement means people just look the other way.

The majority leader and the chairman of the Budget Committee are proud of the Budget Control Act. They say it has iron-clad restraints on spending. They say we do not even need a budget.

But where are they when it comes to making sure this agreement is actually followed? It is curious that we don't have leadership from the majority leader or the Budget Committee chairman to tell the committee: Look, we understand the Postal Service has serious problems. We understand that. Something probably needs to be done to fix that and improve that situation. It may even cost some money. But to do so, shouldn't we comply with the law of the United States and what we agreed to just last summer?

As this unfolds you will hear part of the reason that spending increases is because the bill requires the Treasury to repay the Postal Service $11 billion that the Postal Service has overpaid to the U.S. Treasury for retirement contributions of current employees.

I am not debating that argument and whether it is an overpayment. I am not debating it. We have experts who have looked at it and said it is basically accurate, that the Treasury does owe the postal department $11 billion. Maybe under some circumstances we are required to pay that back. I don't argue that at this point.

I say if we pay it back, is it not an expenditure of the United States? If you are behind on your car payment shouldn't you look to see where else you can cut spending? That is all we are talking about. You have to understand it costs money. The money comes from somewhere.

I think most people understand the U.S. Government borrows money through T-bill sales, and we pay interest on the money we are borrowing. The fastest growing item in our budget is interest on our debt, so we ought to be cutting spending to pay for this. Over 10 years that is $11 billion. That is a lot. But $11 billion is a little over $1 billion a year, and this year alone we will spend, as I recall, approximately $3,600 billion. So we couldn't pay this money back? We could not find $1 billion a year to pay the money back? We have to just borrow it in addition to the money we have agreed to borrow, breaching the debt limit we have agreed not to breach?

I have to note, unfortunately, the $11 billion is only one-third of the debt impact of the legislation. It is only one-third of the amount by which the bill breaks the agreement of last summer.

What else accounts for the total $34 billion? Most of the deficit increase of the bill, about two-thirds, occurs because the bill would restructure the amount the Postal Service is supposed to pay to the Office of Personnel Management to fund the future retiree health benefits of the current Postal Service employees--coverage for them when they retire.

In 2006 the Congress enacted the Postal Accountability Act to set the Postal Service on a self-sustaining course. According to one of the managers of the bill, that law included ``a requirement that the Postal Service endorsed at the time,'' that the Postal Service prefund the future retiree health benefits of the current postal employees on an accrual basis. That 2006 law set out a schedule of those required payments to the government.

Now, 6 years later, the Postal Service says they are unable to make those required payments. We already enacted a bill last year partially relieving the Postal Service of some of their required 2011 payment, so this bill would defer those payments and stretch out the amount of time to pay them.

How much is the Postal Service allowed to defer? The legislation allows the Postal Service to defer $23 billion in payments for retiree health benefits. This legislation would transfer, in part, the burden of these restructured payments from the users of the Postal Service, the stamp buyers, to taxpayers.

This means the Treasury has to go out and borrow the money over the next 10 years because the Postal Service is relieved from making the health care payments. Again, a budget produced under regular order that I have truly felt we should have done--and remain disappointed, deeply, that has not occurred--should have planned for this by including policy changes somewhere else in the budget that would have offset the cost of this bill.

Because the bill does not do that, because it adds to the debt of the United States, and violates the Budget Control Act I will raise a point of order that will require 60 votes to waive it.

If this new spending is necessary, and I suspect some of it may be, then isn't it worth cutting spending somewhere else to pay for it? Do we really have to break our spending agreement when we are facing the fourth straight deficit in excess of $1 trillion.

Washington is in a state of financial chaos. We are in denial. We are not owning up to the fact that there are limits on what we can do. You tell me how long we can borrow $1 trillion a year, substantially more than we take in every year.

The Government Services Administration is throwing lavish parties in Las Vegas. The Government Accountability Office has identified $400 billion--maybe we could pay the $34 billion out of this $400 billion-- being spent every year, each year, on waste, inefficiency, and duplication. That is the official Government Accountability Office.

Far worse, the Senate's Democratic majority has failed to produce a budget plan in calendar year 2010, 2011, and now 2012. This Sunday, in fact, marks exactly 3 years since the last time the Senate passed a budget.

A budget means responsible behavior. It requires and forces Congress to make tough choices.

Now we say the Postal Service needs more money, and we will just borrow it. This is not responsible behavior.

The White House warns that Republicans want to cut too much spending. But the American people know the truth, and the truth is we have never spent more money than we are spending today and spent it more recklessly and with less accountability.

This is in many ways a decisive moment. I deeply respect my colleagues who have worked on this legislation. It is very complex; it is very important; it is a very difficult issue. But this country has to rationally confront the difficulties in the Postal Service. The world is changing. E-mail continues to erode the market for traditional mail. The Postal Service has to adapt to keep up with the times. We cannot just keep throwing money at it.

I deeply respect the people who worked on this, but I do believe it is a crucial vote. Even if one supports every dollar of spending in the bill, do you support violating the Budget Control Act? I ask my colleagues to vote to sustain the budget point of order. Let's stand up for fiscal responsibility.

In effect, we would send the bill back to our good committee, and say to them: Look at it. If they can spend less, please do so. But if they feel they have to spend more money to sustain the Postal Service, propose how it should be offset. It would meet the requirements and promises we made to the American people.

I thank the Chair for the opportunity to share these remarks. It is going to be difficult to fix, but certainly not impossible. If this bill is sent back--I know my colleagues will figure out a way to pay for it.

I thank the Chair and yield the floor.

Mr. President, there is a bill at the desk due for its first reading.

Mr. President, I now ask for a second reading and, in order to place the bill on the calendar under the provisions of rule XIV, I object to my own request.