Marketplace Fairness Act of 2013

Mr. President, yesterday I came to the floor to oppose the cloture motion on the motion to proceed to the so-called Marketplace Fairness Act. I, of course, would like to, I think properly, name it the Internet Tax Collection Act because that is what it is. I strongly oppose this bill which has very serious flaws to it and very serious ramifications for not only businesses in my State, online businesses where we have seen great growth, but also online businesses across this Nation.

I strongly disagree with the decision to fast-track this bill, to skip the regular markup process of the Finance Committee. Both the chairman of the Finance Committee, Senator Baucus, and the ranking Republican on the Finance Committee, Senator Hatch, had opposed going to this bill without the committee doing its work.

Why? There are a number of concerns that have been raised about this bill by Members on both sides of the aisle. At a very minimum, we believe these concerns warrant a thorough vetting through the regular order. That is why I, along with Senators Wyden, Tester, Shaheen, Rubio, Lee, and Cruz wrote a letter to the majority leader expressing these concerns, asking again for regular order for this bill. But here we are. Cloture was invoked and I suspect the

supporters of this bill certainly do not want to go through the markup process so here we are again without regular order.

This bill is wrong for a great area of growth for our country, which is online businesses. Small business owners get hit the worst under this bill. Small business owners from my State of New Hampshire have told me--and large businesses from my State of New Hampshire that do business online have told me--this legislation would make it harder for them to do business. During the recent Senate work period, I held two roundtable discussions in New Hampshire, one in Manchester and one in Portsmouth. It was a great opportunity to hear directly from those on the ground what the implications of this bill will be to business owners in my State. I would like to share a sampling of the feedback from businesses in New Hampshire about this bill.

Russ Gaitskill, who is the president and CEO of Garnet Hill, in Franconia, NH: ``It's going to be a nightmare.''

He sent to my office an example of what he would have to do. Understand what this will make online businesses have to do in this country. They now become the tax collectors for other States, even though they do not rely on the services in those States, they do not use the roads in those States, they don't get to vote for the Representatives in those States. Taxation without representation, that is what this bill is about. They now have to collect for the rest of the Nation's 9,600 tax jurisdictions of different not only State sales taxes but local and county sales taxes.

I want to use one example of what this is like and what an administrative nightmare this is for businesses. This is 1 page of a 40-page sales tax manual that is an example of what any online business across the Nation could have to face. In New Hampshire, if there is a customer from Illinois who chooses to buy from an online business in New Hampshire--here we are. If the person lives in Grand Prairie, it is a 6.5-percent rate. But if the person is from Colona or Collison, a 6.5-percent rate or if you live in Dow, it is a 7-percent rate.

There are 9,600 different tax jurisdictions across this Nation and the people pushing this bill, the proponents, say: Oh, no problem for these businesses. Just use software. Every business has this software. It is going to be easy as pie.

So when Dow changes their tax rate half a percent, the whole program changes. Yes, that burden is put on the business. Talk about an administrative nightmare. Do you know why. Because States are in a position where they want to use that as a cash grab to make other States and online businesses do their work of tax collecting for them instead of them doing it themselves. I cannot believe my colleagues are going to go along with this and those who are pushing it.

I think it is especially odd there are Republicans who want to create this kind of complicated tax mess. I hear from my colleagues on this side of the aisle all the time about how we are going to cut through regulations, we are going to make it easier for businesses. A lot of my colleagues on the Republican end are pushing this notion that a business--oh, just let them purchase some software and then let them try to collect for almost 9,600 tax jurisdictions in the Nation. What could possibly go wrong for an online business? Many of them, smaller businesses in this country, are trying to thrive, trying to grow through a difficult time in our country.

I also heard from E&R Laundry and Dry Cleaners, a small business founded in 1921 in Manchester. About 70 percent of E&R's sales are now Internet based. The company's president said he would not have the resources to calculate, collect, and deliver sales taxes for thousands of jurisdictions across the country.

A bakery in my hometown of Nashua echoed that sentiment. Susan Lozier Roberts of Frederick's Pastries--and anybody who has been there, yum. I can understand why people across the country would want to get some Frederick's pastries. Susan said it would create mass confusion, keeping up with all the individual State tax codes.

I heard the same from one of the most prominent maple sugar producers in the State. In New Hampshire, we are a State that prides itself on its maple sugar products. Peter Thomson--his father was the late Gov. Mel Thomson, a wonderful figure in the history of our State--said it would be a burden we just couldn't afford.

Ken Smith, the owner of Maine-ly New Hampshire, said: I physically don't have the manpower or the hours to be able to handle something like this.

Jenn Coffey, another business owner, said: If I had to become a tax collector on top of what I am already trying to do as a startup--we all know how hard it is so start your own business, by the way--she said: I would be out of business.

I also heard widespread concerns about the threat from faraway audits that this legislation would bring. That is the poster board I had up there, with all these tax rates. In every single one of those jurisdictions, if we divide it by county or we divide it by State, when a business in another State, in New Hampshire, for example--if they are selling to a customer in Illinois, they can then, if their computer program that everyone is saying is so easy doesn't calculate it right, they can be hauled in for an audit in another State where they do not have any physical presence. What do they do? They have to get a lawyer in another State. They have to deal in a court system in another State or with auditors with a department of revenue. Whom do they deal with? Talk about administrative nightmare, to be dragged into another State for potential audits, to have to hire lawyers in other States--what an administrative mess this bill will create.

It is truly shocking to think that people actually want to say this somehow is going to level the playing field or make it more fair, when it puts this great burden on businesses.

Travis Adams, with whaddy.com, based in Nashua, said: One tax audit from another State or jurisdiction would completely crush us.

Ben Baker, an online retailer in Barrington, said: Small businesses like mine just can't handle that kind of accounting burden. If I have to hire a bookkeeper or pay my current offsite accountants significantly more per month to track all this, you can bet my plans to expand my business in the next 6 months are a lot less likely.

Paul Ford, an online dealer in Portsmouth, perhaps summed it best when he said: The last thing we need is legislation like this.

I would also like to mention a comment from Joel Maloy, a friend of mine, a great business owner in New Hampshire, president of Polaris Direct. He said: This is not about making Main Street more competitive. It is about passing new taxes on to consumers. That is consistent with what other business owners have told me from across New Hampshire, and I have certainly also heard it from businesses across the Nation. They know this is not about competitiveness. It is about helping States get more money to spend on programs they cannot afford.

That is what the Wall Street Journal said this week. The paper called the Marketplace Fairness Act an online revenue raid. They said this is a bill--of course, do you know who is pushing this bill? Big business, big retail business. Do you know what it does, according to the Wall Street Journal--and I fully agree with them on this--``. . . big business and big government are uniting to pursue their mutual interest in sticking it to the little guy.''

``[B]ig business and big government are uniting to pursue their mutual interest in sticking it to the little guy.'' Haven't we had enough of that in our Nation? The paper concluded that ``the new revenues will merely fund larger government.''

Some of my conservative colleagues have tried to justify their support for this big government bill on the notion that their States will be able to reduce their income or sales tax. I think we all understand there is no requirement in this bill that States have to reduce some other tax burden if they collect taxes in this way. This is just about spending more money.

Let's talk about the Constitution. By imposing collection requirements on businesses that have no physical presence outside their home State, I also fear this is going to trample on existing State sovereignty. Under current Supreme Court precedent, in the absence of an actual sufficient nexus, a State cannot reach beyond its borders

to compel out-of-State Internet vendors to collect taxes on a particular transaction. That is the Quill decision.

By usurping and changing the standard, it would undermine an important limitation in the commerce clause, the nexus requirement. So now your nexus with a State is a click; instead of a physical presence in a State. If an online business in New Hampshire has to collect and remit sales taxes for online customers from Massachusetts, what is to prevent Congress from later expanding the commerce clause even further to require New Hampshire brick-and-mortar businesses to collect the Massachusetts tax, because Massachusetts has already tried to do this to New Hampshire. In fact, when I was attorney general of the State, we brought a case to the Massachusetts Supreme Court because there were customers from Massachusetts who came over to buy some tires in New Hampshire and the Massachusetts DRA tried to get New Hampshire businesses to collect that tax.

That is exactly what we are doing with this bill. It actually places an unfair burden on online businesses versus brick-and-mortar businesses that are in that situation that now do not have to collect that. But I worry that will be the next step for businesses in my State of New Hampshire and other States across this Nation that do not have a sales tax.

What about stores that sell through catalogs. Their customers are frequently older and less likely to have transportation or be online. Will catalog vendors also have to collect and remit State sales taxes?

Finally, what about other unintended consequences on consumers, retirees, and investors? That is the type of information we would have talked about in a committee hearing that we did not have on this bill before the Finance Committee. There was a hearing, but there was no markup. A markup is when we try to improve and deal with unintended consequences to a bill.

Could this bill open the door to taxes on financial services or transaction taxes? Some of the financial organizations have raised that issue. In my home State of New Hampshire, it is a matter of pride that we do not have a sales tax, and this bill tramples on that choice for the State of New Hampshire. That is because we know it gives our retailers, yes, an advantage in a competitive marketplace, but we also know low taxes are the result of low spending. This legislation threatens to trample on retailers in all States, forcing them to become tax collectors for other States--nearly 9,600 tax jurisdictions, as I have mentioned.

I said it before, and I will say it again. This truly is taxation without representation because businesses in New Hampshire or online businesses in other States can now be subject to doing the business of governments in other States, of collecting their taxes, when they don't elect the representatives there, when they don't rely on the roads there or the services there. Here we have it--the ultimate in taxation without representation. I say to my conservative colleagues, why would they want to support such authority given by the Federal Government?

Supporters of this amendment argue that they have created an exemption for small businesses of $1 million for small sellers, but this amount is not indexed to anything. What about the business that is $1 million and $1 in sales? Then they have to do it, and it is going to discourage businesses from growing.

Also, this limit is far lower than the SBA--the Small Business Administration--actually defines a small business.

Even with this exemption, trust me, once this exemption is in place and the States don't get all the revenue they want, they will be back. They will be back before this body to say: We didn't get enough money, so the Senate needs to authorize us further. Get rid of the exemption. We have a right to collect from those businesses as well or have them collect for us as well because that is what it is--requiring them to collect for us.

A broad coalition of groups is opposed to this far-reaching legislation. Let me talk about a few of them.

No. 1, Americans for Tax Reform. Americans for Tax Reform said:

This legislation grants states new tax collection authority

without removing equivalent taxing authority elsewhere.

Therefore, this legislation can only be viewed as a tax

increase.

The Financial Services Roundtable said:

This legislation has the potential for unintended

consequences. It's important for Congress to explore all

possible outcomes and costs of this proposal, especially the

impact on consumers.

A transaction tax on financial services products will hurt

retail investors, retired Americans, and small businesses,

effectively making it more expensive for them to invest and

plan for the long term. Without hearings, these implications

and others will not be properly addressed.

Again, the Securities Industry and Financial Markets Association has raised similar concerns, saying that this could lead to a financial transaction tax which will hurt all of us.

TechNet opposes this, saying:

Imposing a new Internet sales tax regime is a tremendously

complex issue that should be addressed through regular order,

starting in the Senate Finance Committee, and done in a

thorough and deliberative manner.

That has not been done here.

We should not rush a proposal that is riddled with holes

and, most importantly, does not provide enough protections

for small businesses, the back bone of our economy.

Americans for Prosperity opposes this. Americans for Prosperity says:

This bill would not level the playing field; it would

burden online retailers in a way that brick-and-mortar stores

are not. Complying with the internet sales tax would be a

considerable administrative burden for companies,

particularly for small businesses.

Freedom Works opposes this as well. Heritage Action for America opposes this. The National Taxpayers Union opposes this. The Competitive Enterprise Union opposes this. Competitive Enterprise Institute opposes this, as well as the Council for Citizens Against Government Waste. These are groups that are committed to low taxes, less government, and free enterprise so we can have a strong economy.

Again, I encourage my colleagues on both sides of the aisle-- especially my colleagues on this side of the aisle--to listen to the red flags these groups and several of my other colleagues have raised.

I will conclude by once again restating the serious concerns I have about this legislation. I have concerns about the impact on small business owners in my State and in States across the Nation. I have concerns about the impact on online businesses that have been such an area of growth for this country.

The concerns about the administrative application of this bill--I showed my colleagues all the tax jurisdictions. To put that burden on businesses is absolutely wrong. It is wrong for creating jobs in this country, and it is absolutely wrong to put such an administrative burden on people who are working so hard in starting their businesses and thriving and making sure they grow.

I believe we are opening Pandora's box with this bill, and this shouldn't be done in the manner it has been--without regular order. We are talking about a massive reorganization on how sales taxes are collected in this country. What will be next? What will the States ask us for the authority to tax next? That should be a very big question for our colleagues.

I strongly encourage my colleagues to put the brakes on this bill and to think about the harm this legislation would do to small online retailers across America. When consumers and online retailers in the States of my colleagues find out what is actually in this bill and they don't understand why their Senators would support an online sales tax bill, I know they will raise many concerns to my colleagues when they have the administrative burden and the nightmare of trying to collect for 9,600 tax jurisdictions in this Nation.

I urge my colleagues to oppose this bill. Thank you.

Mr. President, I want to congratulate the Senator from Maine on his speech. It was a tremendous history lesson. I have enjoyed getting to know him a little bit since he got here. I had quite an interesting surprise yesterday. He came to my office and he brought an American flag, all framed. The way he got it, there was a desk his great-aunt had. The desk was probably made in the 1860s. But behind one of the drawers they found this flag. It was a flag with 44 stars. Wyoming was the 44th State. So he presented this framed flag to me. Incidentally, that was only the flag of the United States for a 6-year period. Then some other States came in and we added them. It has an interesting arrangement of stars on it too, because the 44 stars do not fit in a nice even pattern unless you did four rows with 11 in a row. That changes the dimensions of the flag considerably.

I appreciate his consideration on that. I appreciate the consideration he has given to pieces of legislation that I have seen him work on. We do not agree on all of those pieces of legislation, but it is nice to have the concern and the thought and the process for getting things done that he brings to the Senate. That is very nice.

I too want to encourage my colleagues if they have amendments to bring them down. That is what we say this process is about. This is an amendment process on the floor, which everybody has asked for. We are doing it. So we need the amendments. A number of people have talked to me about different parts they had a potential concern about. I hope we solved their concern by actually looking at the wording in the bill. This is not a very difficult bill to read. Sometimes we do ones that are a couple of thousand pages. This one is 11 pages. I do not think there is anybody who will not be capable of reading the bill. Unlike most of the bills, this is in pretty normal language, rather than some of the conforming language that sometimes results around here.

I think most of the problems retailers should have with this have been taken care of. One that the nonsales-tax States talk about, and the Senator from Illinois, Mr. Durbin, also mentioned, the people in those States still will not pay a sales tax. But if you happen to be one of the people selling into other States, and you sell a tremendous volume into other States, then under this bill you will be expected to collect and remit the sales tax, as any retailer in the States that have sales tax.

There is an exemption. The Senator from Oregon, Mr. Wyden, asked us to have a compromise. That is why we have the exemption in there. It is a compromise. We started with it in the Senate as being a $500,000 exemption. The House folks convinced us--as I mentioned, this is a bipartisan, Republican and Democrat, bicameral, House and Senate effort. The House convinced us that $1 million was a more reasonable figure, and they gave some good reasons for it. Now $1 million would give any small businessman quite a few years, perhaps--I hope it is a short period of time, but it should give them quite an amount of time before they had to adjust to this, because they have to sell $1 million on line in a year before they have to start collecting the tax the next year.

In a State where there is a sales tax and the people are selling in the brick-and-mortar store which we are trying to help out with this bill, they collect from every person from the first dime of sales. So we have given a little bit of a break to particularly the nontax States, and to those working on line that are small businesses to continue this effort to grow the Internet.

Of course, we are hoping a lot of our businesses in our States will get to that million-dollar mark. But here is the status on the million- dollar mark. We are told that if we reduced that to $150,000 it would only affect less than one-quarter of 1 percent of the businesses in the United States--not very many. They are starting to be a relatively big business when they are doing $1 million on line. This does not count their in-store sales. This is just their on-line sales. So I hope the other States that have had some difficulty with that will realize that is a pretty liberal mark we have gone to.

Of course, I know a lot of people are getting a lot of correspondence from eBay. eBay, in the 12 years I have been working on this bill, has consistently opposed it, even though they appeared almost up to the time we were ready to do the bill to be in agreement with some of the things that were in the bill.

Incidentally, that is when we had a considerably bigger bill. It was about 80 pages long. This one we changed. The main difference is now there are States rights, which there should have always been. That is the way it is in the Constitution. This is a States rights bill. That reduces the length of it considerably.

The million-dollar proposal is to give people time to adjust and collect. Incidentally, there is kind of a phase-in in this. Some people say, why don't we have kind of a phase-in? Well, we have 90 days. We agreed to do 6 months so people could gear up for it.

Besides that 6 months, the States are going to have to provide free software to be able to do the tax, so that when they put in a ZIP Code for where they are sending the product, they will automatically know the tax. They talk about 9,600 tax jurisdictions. Well, in this there are only 46 different tax jurisdictions. Nevertheless, they put in that ZIP Code and they will know what the tax is and have no liability whatsoever because that falls on the people who provided them with this free software. This makes a huge difference to States, counties, and municipalities.

I used to be a mayor. I was a mayor of a town that tripled in size during the 8 years I was mayor. Had it not been for sales tax, we would have been broke. I checked around to see how much towns and municipalities rely on the sales tax for their source of revenue. I was shocked. About the minimum that I run into is 30 percent. There are quite a few more than I ever thought that rely on sales tax for 70 percent of what they do.

So what does a municipality do with its money? Well, let's see, a lot of them have schools they have to take care of,

they have law enforcement they have to take care of, they have firefighters they have to take care of, some of them have ambulances. So it is all of the first responders essentially they have to take care of.

If you are in the northern States, as I was, you have to do it for snow removal. People are really particular about snow removal. Incidentally, Wyoming is still having a little bit of winter. Let's see, today is Wednesday, so that is typically our spring. We have a lot of snow, even in April. That is when most of our moisture comes. We get snow in January too, but that is a real dry snow. In fact, we are such a dry climate that I often tell people that even our rain is only 80 percent moisture. Of course, a lot of it gets sucked up by the air as it falls. A long rainstorm in Wyoming might be 5 minutes. We get a total of 13 inches a year. So we rely on that snow. But if you are a mayor and it snows, you have a major problem, because people expect to be able to get around. I found out that if you plow it to the center, then they cannot make left-hand turns. If it is left on the ground very long and that freezes, then you really have a problem getting it up. If you plow it to the sides, you block in people's driveways and people's cars. That usually upsets them too.

I remember when I was mayor, every once in a while I would get a call from a disgruntled citizen who would complain that I just plowed their driveway back in after they had gotten it open. They wanted to know what I was going to do about it. I would tell them to give me a few minutes. I would get in my car, which always had a snow shovel in the trunk. I would go to their house and start digging it out. Usually when they noticed me, they came running out and said: Oh, no, we did not intend for you to do that. I said: Well, everybody else is doing snow removal. I never got two calls on that. But that is another use for sales tax money. There are many more.

All of the charities in a town usually go to the city council. They say, we have this valuable project. We need some money. Anybody who says they cannot fight city hall probably never tried. A lot of those requests are granted.

But if the sales tax continues to shrink--that is what is happening with it now, State sales tax, county sales tax, local sales tax is all shrinking. If that continues to shrink, they are going to have to start cutting back on things they do. Of course, probably some of the charity things will be some of the first ones to go. It is always hard to tell what the net effect will be. But if they do not have any ability to increase the revenues they have--and most of the towns in Wyoming do not have a chance to increase the taxes they receive. Property taxes are limited by very specific sorts of things, such as how much you can levy for the cemetery, and how much you can levy for a library, and how much you can levy for fire. Those things do not begin to cover the cost of the service that is rendered.

So to the people who are protecting the Internet, I would say it is pretty hard to flush your toilet on the Internet. Sometimes those utilities come into play with these things too. Those taxes are very important to almost all of the communities across the United States, in 46 States. The other four do not have a sales tax.

One of the things people have said is, if they get this extra sales tax, why don't they bring down some of the taxes they currently have? Some of the States and some of the municipalities and counties will do that. I have had several of them tell me that if we could get a little bit more in sales tax, we would do that.

But let me tell you a little problem we have in the Federal Government. We are out of money, so we are cutting back. And one of the ways we cut back was through the sequester.

The way some of that is worded, some of these things are considered tax expenditures. For instance, the Federal Government promised to pay a property tax in lieu of real taxes. In other words, the municipality does not tax them, the county does not tax them. But the Federal Government says: Yes, we own property. If you can sell that property at a private sale, the private entity would have to pay property tax on that. So it is only fair that the Federal Government pays taxes in lieu of taxes. They have been doing that for a number of years.

The value of the properties, of course, has gone up considerably, particularly in cities where there are Federal buildings, but also in the forests. I have people who know the value went up because they are able to lease some cabin land in national forests. Their payments have more than doubled in the last 3 years. That is a 100-percent increase. I guess this year it is even a more dramatic increase. But the Federal Government, while it is charging more for the property, is not paying more in property taxes, which would be the normal thing. This year, they are taking 5.3 percent out of every bit of that tax. Of course, I say to people: Wouldn't it be nice if when you file your Federal income taxes you could have taken 5.3 percent out of there? It is sort of the same thing. It is what the government said they would pay in taxes.

There are a number of reasons these sales taxes are extremely important and getting more important. If you had Federal mineral royalties, you lost 5.3 percent of that too. That is because the States collect--half the money from the minerals in the State are supposed to be for the State and half are supposed to be for the Federal Government. The half the Federal Government received they considered to be revenue. The half that is supposed to stay with the States or go back to the States is considered a tax expenditure. Again, it was hit by 5.3 percent.

One of the reasons this is 5.3 percent this year in the sequester instead of 2.3 percent--which is what it was across the board for the .3 percent--is we don't have any months left to revise those expenditures, but these are one-time payments. The time for condensing them has not expired, so at the most it should have been 2.3 percent. That is a different problem that I will handle in a different bill. I am hoping people will not try to gum this up with a whole bunch of nongermane or irrelevant motions. If we stick to relevant ones where we are really trying to improve this bill, I am in favor of it. If we are trying to do some other peripheral ones, in light of the tremendous support this bill has, I am hoping people will stick to the bill and try to perfect it. We can have votes on that.

I see my friend from Tennessee is here.

I yield the floor and reserve the remainder of my time.

I thank the Senator from Tennessee for his comments. He is very involved in the Banking Committee. He understands the transaction taxes that they are talking about, and I appreciate his learned opinion on that.

Mine comes from section 3, called ``Limitations,'' and in general it says: Nothing in this act should be construed as subjecting a seller or any other person to franchise, income, occupation, or any other types of taxes other than sales and use taxes.

I hope we stick to that and make sure it just says ``sales and use taxes.'' I have worked on this for 12 years, so it is tough enough to extend it beyond that. I know there are lots of things people would like and to open this up.

I appreciate the one amendment that was presented but was objected to, which was an amendment which would have continued to ensure--we already have a provision that says you cannot tax the Internet. You cannot tax the Internet. They wanted to extend that another 10 years, and it doesn't expire for another couple of years.

I thank the Senator for all of the effort he has gone to on this bill and all the ways he has helped us. I appreciate his plea for people to come forward with their amendments.

I suggest the absence of a quorum.

Mr. President, I thank the Senator from Texas for his comments.

There is definitely a problem. We had people miss votes on Monday night because the supposed furlough that the air traffic controllers had to have in effect delayed some planes for more than 1\1/2\ hours. I looked at some of the numbers, and I don't think that had to happen. Even within areas, there is enough flexibility to do better things.

I noticed some of the sequester things in Wyoming that came out and made calls about them, and found out that people actually could change within their own budgets some things they were concerned with and make sure it didn't affect the customer.

That is just good management.

One of the things was closing down some of the visitors centers in Yellowstone and Grand Teton. They are not open yet because at this time we are just getting the snow cleared out. I called and asked about keeping them open and they said we don't have enough personnel.

You have a gift shop there. That is a profit center. You are supposed to be making money on that.

They said the money goes to the general fund.

I said: Where do you think your money comes from?

The gift shop should operate, and if they have a problem with personnel, all they have to do is the person who runs the gift shop opens the door, does their day's sales, and in the evening as they are ready to leave, I hope they would look up and down the street and see if another customer was coming, but if they were not, go ahead and lock the door and leave. That is just good business. That is the way they could operate. It is my understanding those gift shops and visitors centers will now be opened.

There are ways that could be handled. To go back to the bill----

I yield the floor.

Mr. President, I appreciate that question. One of the reasons there is difficulty, there is the blue-slip problem with the House, but also we have the section on limitations in this bill that appears on page 7. There are only 11 pages in this bill so it ought to be fairly easy for people to look through it and see what is included and what is not included. We have pretty much limited this--not pretty much, we definitely limit this to sales and use taxes. When they put other peripheral things in there, then they are opening the bill to go into a lot of different things. So I hope that would not happen.

Of course, there was some question earlier in one of the speeches by the Senator from Montana about the real difficulties of being able to administer this. Again, there are only 11 pages in the bill. Page 4 covers software, free of charge for remote sellers, that calculates the sales and use tax on that transaction due at the time it is completed. It also has to provide a way to file the sales and use tax returns, and it has to be updated for any rate changes that there happen to be.

The responsibility is all on the State to provide the software. I think the provisions that are in there pretty well specify how carefully that has to be done. If it is not, there is no liability on the remote seller. So I think we have covered that.

Yes, it will be difficult to do that software, but that is part of the provision in here. It can be done. This is a day, as the Senator from Tennessee points out, that we can put in a ZIP Code and find out what our sales tax is going to be. That is what this program is calling for. I think I have that right. I rely on the Senator from Tennessee to answer that question more specifically.

Mr. President, I suggest the absence a quorum.

Mr. President, before he leaves the floor, let me commend my colleague from Minnesota for making so many thoughtful points in this effort to deal with climate change. Having returned from Oregon, with a whole host of meetings in connection with Earth Day, the Senator is spot-on in speaking about the enormity of the problem. It is very clear that the planet is getting warmer, drought is becoming more serious, the fires are becoming more catastrophic and the storms increasingly brutal. It is very clear that now Democrats and Republicans must come together around this issue.

The Senator and I serve together on the Energy and Natural Resources Committee. This will be priority business for us, and his thoughtful remarks today are yet another effort in terms of trying to bring people together. The focus of the Senator's remarks has been not to say it is this person's fault or another person's fault, it is about how Democrats and Republicans need to come together.

I commend my Democratic colleague for his good speech and the good fortune to chair the subcommittee on Energy and Natural Resources, where he will be able to focus on these issues.

I ask unanimous consent to speak as if in morning business for up to 30 minutes.

The Senate has now moved to the Marketplace Fairness Act. I say this, frankly, a little dubiously because I think it really ought to be called the Shop Canada or Shop Mexico Act. It will make it attractive for businesses located in the United States to set up shops overseas as the coercion that is applied to the United States will not affect foreign retailers.

What I wish to do tonight is speak for a brief period of time-- because we are going to have opportunity throughout the week to discuss this--in the hopes that the points I highlight tonight will help start a bipartisan effort to attempt to fix what I think are the most serious problems with the Marketplace Fairness Act.

The essence of my concern is that coercion and discrimination are not what America is all about. Those are the fundamental principles of the Marketplace Fairness Act. What I wish to do is be very specific with respect to how this coercion and discrimination, particularly against some of the most innovative forces in the American economy, are going to take their toll.

With respect to coercion, this is legislation that enabled one State to impose the enforcement of its laws on 49 other States and the territories without the approval of such States and territories. Let me repeat this. It is coercion. It can be forced on these other States against their will. In effect, under the Marketplace Fairness Act, businesses may be audited by a myriad of out-of-State tax collectors and be forced to defend themselves in out-of-State courts.

A vote for the Marketplace Fairness Act without efforts to try to promote some element of voluntary participation is a vote to subject a Senator's home State Internet companies to the whim and will of tax collectors and State courts around the country. This, in essence, is the coercion aspect of this legislation.

I have suggested to Senators that at a minimum this effort, this legislation should be altered to allow for voluntary compacts. Congress would say States could voluntarily take these steps with respect to interstate tax collection rather than being required to do it. I have heard my colleagues who say perhaps this would make one State a haven with respect to Internet sales. The reality is that States rights are about States rights. One State may look to choose to incent one particular type of business or another, but this is ultimately a State decision.

If you are, in fact, a supporter of States rights, why would you oppose something that allows a State to voluntarily choose what course it wishes to promote with respect to the collection of online taxes? This is not what this bill is all about. It is not voluntary, it is coercive. That is why, in my view, it undermines what I think the principles of our country are all about. Our country is not about coercion, it is not about discrimination. This is what the bill, regrettably, is all about.

Let me outline the second point with respect to how the Marketplace Fairness Act discriminates against Internet companies. The Marketplace Fairness Act relies on Internet sellers to determine the address of where consumers are located in order to generate an approximation of where goods or services sold by an online retailer will be consumed. There is no similar requirement with respect to brick-and-mortar businesses--no similar requirement with respect to brick-and-mortar businesses--even though consumers often travel across State lines in order to purchase goods and services that may be unavailable to them in their home jurisdictions or available at lower sales or use tax rates.

The Marketplace Fairness Act does not require brick-and-mortar firms to obtain and use consumer information to determine where a good or service may be consumed. Why should the Federal Government require Internet companies to collect and remit sales and use taxes on behalf of consumers but not impose any such burden on brick-and-mortar firms providing goods and services to out-of-State consumers?

So the irony of this is that really about 15 years ago--and it has been particularly satisfying to me in terms of our service in the Senate--as we began to look at policies that would allow innovation and technology to grow--and I will talk a little about how some of those policies led to the first investments in social media--we established two principles with respect to technology policy: No. 1, we said let's ensure there is no discrimination. What goes on off-line and what goes on online should be parallel so that we can encourage both parts of the American economy.

That principle has made a lot of sense. In fact, it has led to a great many stores--I am sure at home in Indiana for the Presiding Officer of the Senate--with bricks and clicks looking to try to have a vigorous presence in States because the two are mutually reinforcing. To do that we have to ensure there is a policy of nondiscrimination.

What I have done is outline very specifically about how the Marketplace Fairness Act moves away from that principle of nondiscrimination by giving, in many jurisdictions, the brick-and- mortar retailers a leg up. And what I am in favor of is continuing that policy which has made sense for 15 years.

We also talked about doing no harm and ensuring we especially promoted voluntary approaches--voluntary approaches. I think it was before the Presiding Officer was in the Congress, but one of the things I was especially proud of was our help in generating investment in the social media back when I came to the Senate. There was a great concern about censorship online. Of course, all of us, as parents, were horrified by some of the smut and pornography that was coming available online, all over the Web, and so a big debate was held.

There were essentially two approaches: One was to set up a big censorship effort that would say, for example, if somebody posted some of this horrible pornography on a Web site or a blog, the Web site would be held secondarily liable for this material posted on the site. A lot of us said: No way the Net is going to be able to grow if Web sites and blogs are held liable for something that is posted on their site, which they probably aren't even going to know anything about because there are, of course, thousands and thousands of postings-- millions in the case of some of the big sites.

So working with a very conservative Republican in the House, Congressman Cox, we wrote an alternative approach which encouraged voluntary approaches with respect to dealing with a societal problem, and a very serious problem with respect to pornography. Back then the Congress didn't know how to deal with these issues, so both approaches--both the censorship approach and the voluntary approach to help parents filter out the smut--actually got into the law and it went to the Supreme Court. The Supreme Court struck down the censorship approach and upheld the voluntary bipartisan approach Congressman Cox and I put together.

Today, when we talk to people in the social media, they will tell us that voluntary approach was, to a great extent, what encouraged the first investments in social media. People in social media will say nobody would have invested in the future Facebooks and Twitters and the like if they thought the social media sites, the Web sites and the like, were going to be held secondarily liable for something that was posted.

That voluntary approach, which did so much to boost our economy, is being rejected in the Marketplace Fairness Act as it is written because this bill goes to a coercive approach, as I said, that would outline the ability for one State to impose the enforcement of its laws on 49 other States and territories without the approval of those States and territories.

So I bring up this tonight because I am very hopeful as this debate goes forward and the bill is considered further that at a minimum the sponsors of the legislation--and all of us here can count and look at vote totals--will see that allowing for voluntary compacts is really what States rights are all about, No. 1. It is that voluntary approach that has made such a difference in encouraging the innovation and growth of the Internet and technology.

One other point I would like to mention tonight is what this bill does with respect to America's ability to compete in a global economy. This is, in effect, an unprecedented approach that would apply local laws to the global medium that is the Internet.

For example, I just came back--flew about 6,000 miles over the last few days--from meeting with constituents at home. I was in southern Oregon until the middle of the day yesterday. They have a big e- commerce effort going in a wonderful company called Fire Mountain Gems in Grants Pass, OR, with hundreds of employees and a very exciting online business. Their big competitor in Grants Pass, OR--which is a town that has been hard hit economically. We are working hard on their forestry issues, particularly trying to get the harvest up. That is something I am working on as chairman of the Energy and Natural Resources Committee, and I had a good chance to talk about resources policy with the Presiding Officer of the Senate.

One of the things they very much want to do in Grants Pass is find as many good-paying jobs as they can, given the fact the economy is hurting in rural areas.

So as I try to boost the harvest in Grants Pass, OR, and get people back to work in the woods, I am obviously looking for other areas where businesses could grow. This legislation, as

written, will deal a significant body blow to a business's ability to grow, such as the one I know about in Grants Pass, OR. Here is why: The legislation doesn't apply to foreign retailers, and the competition for Fire Mountain Gems is certainly overseas, with a host of companies in this space.

It also has huge implications for the northern border and the southern border of our country because so many of the promising businesses in those communities are going to say to themselves: We are patriotic Americans. We deeply believe in our country and our values, but how are we going to compete? How are we going to figure out a way to wade through more than 9,000 taxing jurisdictions? Wouldn't it be more sensible to just move a half hour across the border and not have to go through any of this?

I just don't think this works as it relates to the global economy. Maybe this bill ought to be called the Shop China or Shop Mexico or Shop Canada bill. Whatever you call it, it seeks to apply local laws to a global medium. That, in my view, defies common sense, and, by the way, that too has been a principle that has been rejected in debates about tech policy over the years.

So I hope Senators are going to be open to working with the bipartisan group--there are a host of Senators on both sides of the aisle who care about these issues--to take some of the principles that have been central to the growth of innovation, online business-- particularly as it relates to new apps and new technologies--that have worked for the last few years and build them into this legislation, rather than repudiate the principles of voluntarism and nondiscrimination that have been so key, as I have outlined here tonight, to investment in the social media, to encouraging innovation through nondiscriminatory tax policies, and to new innovations that we began to bring into the policy arena, such as digital signatures.

There we had the same thing--a great concern about whether this was equitable, whether it would work, but after hearings and a thoughtful analysis, a group of us wrote that law as well. So whether it was regulation, whether it was taxes, whether it was innovation such as digital signatures, the four or five laws over the last 15 years that have paid off for technology and innovation and small business--the basic principles behind those laws--are being repudiated in this bill and, I believe, will be injurious to the country.

So my hope is, as we go forward, that we can take some of those principles that have been key to growth in the technology sector and start building them into this discussion with respect to collection of online sales taxes.

By the way, for more than a decade, this has been a topic. I and others have said we are very open to any and all approaches to collect taxes owed, and particularly ones that don't amount to what looks like bureaucratic water torture associated with the collection process. And I think Senators are underestimating how difficult this will be.

I would particularly cite the proposition that if it was so easy, it would have been done some time ago. By the way, it would have been done with voluntary actions through many of these taxing jurisdictions rather than the coercive approach that is advanced in this legislation.

I see my friend from New Hampshire. I was particularly struck, I would say to my colleague, about how the principles I am talking about today--coercion and nondiscrimination--apply in my colleague's State as well because her State, as so many others, would face the prospect where online retailers would have one set of burdensome rules that wouldn't apply to a whole host of other businesses. It brings back the principle of discrimination we rejected years and years ago.

Having heard the Senator from New Hampshire speak eloquently on these issues, I look forward to her remarks. When I came to the floor, I said the key to successful tech legislation for the last 15 years has been two principles: a voluntary approach rather than a coercive approach and nondiscrimination rather than discrimination. The Senator from New Hampshire and I are from States where this bill brings those policies-- coercion and discrimination--back in very stark terms that will be injurious to the citizens we represent and harm the cause of innovation across the country.

I thank the Senator from New Hampshire for all her contributions.

Mr. President, I wish to thank the Senator from New Hampshire for her contribution.

Obviously, the vote this afternoon didn't go our way. My hope is that as Senators from both political parties have a chance over the next few days to lay out the consequences of the two principles we have been talking about--staying away from coercion and staying away from discrimination--by the time the Senate has completed debate and votes, we can come up with a proposal that will not set back the cause of innovation in this country.

We both have talked about the fact that the March numbers on jobs were not where we would like them to be. Particularly distressing is the number of people who seem to be either dropping out of the workforce or working part time because they can't find anything full time. Now we are looking at policies that will make efforts to put those people back to work even harder.

So I am very appreciative of the fact that the Senator was able to come to the floor; because what I tried to do over the last 20 minutes or half an hour is outline what has worked in technology policy for the last 15 years. It has been nondiscrimination and noncoercion. This bill repudiates both of those. My hope is the Senator and I and other Senators on both sides of the aisle can find a way to change this legislation so as to at least not go backward with respect to those values that have been so key to the growth of jobs in the technology sector. To have the Senator here is so helpful, and I am very appreciative.

A good note to close on.

Mr. President, I yield the floor and I suggest the absence of a quorum.

Mr. President, I heard the Senator from Colorado. My remarks are about 25 minutes. Are the remarks of the Senator from Colorado significantly shorter?

I yield to my colleague.

I will yield.

I ask unanimous consent to speak as in morning business for 25 minutes.

Mr. President, I rise today to talk about climate change. But I first do want to say how pleased I am that we just got cloture to move to debate on the Marketplace Fairness Act. I am a strong supporter of the legislation. As I said, I am a cosponsor. I look forward to the upcoming debate. I plan to speak on this legislation further tomorrow.

Now I would like to talk about climate change. More specifically, I rise to suggest that we in this body talk more about climate change so that we can agree on taking action to address it. We need to address the environmental impacts that we are currently facing and the future impacts that will only become exponentially worse if we fail to act. 2012 was the hottest year on record in the continental United States. In fact, it beat the previous record by a full degree.

To give you some idea about how remarkable a full degree of warming in 1 year is, scientists tell us since the last ice age 20,000 years ago the Earth has warmed only 16 degrees at the most. Since we began actually measuring

temperatures in the continental United States and recording them 117 years ago, the variance between the coldest year and the warmest year has only been 4.2 degrees.

So for the temperature to jump a full degree in 1 year is not just remarkable, it is alarming. Often when people consider the harmful consequences of climate change and its cost, they are talking about the future. But make no mistake, climate change is already costing the United States serious money.

2012 was a year when a historic drought caused more than 70 percent of U.S. counties to be declared disaster areas. Agriculture Secretary Tom Vilsack has estimated the drought's impact on the agricultural sector to be around $50 to $60 billion. That cost gets passed on to every American. The drought destroyed or damaged major crops all over this country, making corn and soybeans more expensive, increasing animal feed costs. So Americans are paying more for meats and other animal-based products.

The 2012 drought dramatically lowered water levels on the Mississippi River, seriously interfering with our ability to transport our agricultural goods to market to compete with those from other countries. So that barges did not run aground, shippers sent them down the Mississippi River the last few months half full, say, with soybeans, making our beans less competitive with Brazilian beans.

More and more of my conversation with Minnesota soybean growers who export over one-third of their crop focused on this very issue. Climate change is exacerbating our Nation's wildfires, and that is costing us serious money. When Forest Service Chief Tom Tidwell testified before the Senate Energy Committee, I asked him about the link between forest fires and climate change. He told us that throughout the country we are seeing longer fire seasons on average by more than 30 days. Wildfires are also larger and more intense.

I asked Chief Tidwell whether scientists at the Forest Service thought that climate change was increasing the size and intensity of wildfires and extending their season. Without hesitation he said yes. The Forest Service is spending more and more of its budget fighting wildfires, now about half of its budget. Longer fire seasons and larger more intense fires are just going to eat up more of that budget.

Not only is climate change worsening our forest fires, it is also exacerbating other problems plaguing our forests. That includes a very serious bark beetle crop. The bark beetle is normally kept in check because cold winters at high altitudes kill its larva.

Let's talk about the bark beetle at high altitudes. Their larva used to freeze. But now, because of climate change, that is not happening. The winters have gotten warmer and at higher altitudes, and the bark beetles are surviving. That means they are destroying more forests.

Similarly, in some Colorado forests scientists have shown that because of warmer weather, mountain pine beetles have gone from reproducing once a year to twice a year. In a little over a decade, this mountain pine beetle has killed more than 70,000 square miles' worth of trees. That is an area equivalent to the entire State of Washington.

Of course, we cannot talk about climate change without talking about sea level rise. I serve on the Committee on Energy and Natural Resources. Several months ago we had a hearing on sea level rise. We heard testimony about how rising sea level is increasing the size of flood zones and increasing damage that occurs from storm surges.

One of the witnesses told us that just a few extra inches of sea level could result in a storm surge that could flood the New York City subway system. It sounded like something out of science fiction. Yet a little over 6 months later that is exactly what happened. That is exactly what happened when Hurricane Sandy hit New York City and flooded the subways.

My colleagues do not need to be reminded of the cost of Hurricane Sandy. It is costing taxpayers a staggering $60 billion. Unfortunately, only one of my colleagues from the other side of the aisle, the ranking member, Senator Murkowski, attended this hearing. This has been pretty much the case whenever we have a hearing that even tangentially relates to climate change.

A number of my colleagues in Congress do not believe that human activities contribute to climate change. Many others, I suspect, do not talk about climate change because addressing it requires making some difficult choices. But let's be clear about this. Climate change is already costing us. If we do not act now, it will worsen dramatically and be far more costly.

The Defense Department has studied potential threats to national security imposed by climate change. DOD's 2010 Quadrennial Defense Review states that climate change may act as an accelerant of instability or conflict. That, in turn, would place burdens on civilian institutions and militaries around the world. The top commander in the Pacific, ADM Samuel Locklear, has said the biggest long-term security challenge in the Pacific is climate change. As the Pacific commander he understands the impact sea level rise and extreme weather events can have on our military resources and on civilian populations in the Pacific.

My constituents in Minnesota also understand the threat of climate change. That is why recently nearly 400 people gathered at a local Lutheran church in Willmar, MN, to talk about climate change. Willmar is not a big city. So when this many people gather in one place, you know it is a big deal. They are concerned about climate change and the marked increase in severe weather occurrences.

But when they look to Washington they see a disconnect. They see a disconnect between what the country is experiencing and what Washington is doing about it--or, rather, what Washington is not doing. Outside of Washington, and not just in Minnesota, things are different. In fact, many respected Republican leaders outside of Washington understand the importance of addressing climate change.

In the aftermath of Hurricane Sandy, for example, Republican Governor Chris Christie of New Jersey acknowledged that climate change is a problem and that human activities are playing a role.

Former Governor Arnold Schwarzenegger of California, also a Republican, has launched an organization to fight climate change. Former Utah Governor and Republican Presidential candidate John Huntsman has noted that whenever a party takes a position that runs counter to the position of 98 out of every 100 scientists, that party has a problem.

Governor Huntsman is right. Let me illustrate with an analogy. Say you went to a doctor who told you: You know, you better start eating more sensibly and start exercising because you are tremendously overweight. I see in your file that your father died of a heart attack at an early age. So you really have to go on a diet and start working out.

You say: You know what, I would like a second opinion.

So you go to a second doctor and he examines you, or she examines you, and says: OK, look, you have a family history of heart disease. Your father died of a heart attack at 40. You weigh over 300 pounds. Your cholesterol is out of control. Your blood pressure is through the roof. It would just be irresponsible of me not to immediately send you to the Mayo Clinic to this place I know. You have to go there.

Then you say: Thanks, doctor, but I would really like a third opinion.

The third doctor says: Wow. This is a problem. You know, looking at your family history and looking at you and your tests, I am amazed you are still alive. You have to do something about this.

You say: You know, I would really like a fourth opinion--and this keeps going. It takes months. Finally, you get to the 50th doctor. The 50th doctor examines you and says: Boy, it is a good thing you came to me because all this diet and exercise would have been a waste. You are doing just fine. Those other doctors, well, they are in the pockets of the fresh food and vegetable people. Enjoy life as much as you want and watch a lot of TV.

Then you learn this doctor was paid his salary by the makers of Cheetos. Don't get me wrong--Cheetos are a delicious snack. They can and should be eaten in moderation.

If 98 out of 100 doctors tell me I have a problem, I should take their advice. If those two other doctors are paid by

``Big Snack Food'' the way certain climate deniers are paid by ``Big Coal,'' I shouldn't take their advice. However, 98 out of 100 climate scientists are telling us we have a problem.

Governor Huntsman is right. Outside of Washington, many people get this. Even some of the very companies that previously funded anti- climate change efforts have turned the page on this issue. ExxonMobil used to fund the Heartland Institute, which is one of the leading climate change denial organizations. If you go to ExxonMobil's Web site today, it states, ``Rising greenhouse gas emissions pose significant risks to society and ecosystems.'' Shell Oil states on its Web site, ``CO2 emissions must be reduced to avoid serious climate change.'' Even the major oil and gas companies have begun to acknowledge that climate change is real.

I respectfully suggest that my colleagues on the other side of the aisle here in Congress also need to engage in a serious conversation on climate change. At a time when Americans are dealing with record droughts and devastating hurricanes, the Senate cannot afford to simply ignore climate change. We need to talk about this, as Democratic and Republican leaders outside of Washington are talking about it. Ultimately, we need to come together to address climate change before its damaging costs to society are out of control.

I do not pretend this will be easy. Some people will point out that climate change is a global problem. It is. We can't solve it alone. We can't, and they are right. Emissions in the developing world are now on the rise. China surpasses the United States in total greenhouse gas emissions--not per capita; we are still ahead on that. But China is also making major investment in renewable energy. According to the United Nations Environmental Program, in 2011 China led the world in renewable energy investments, with nearly one-fifth of the global total. This is in spite of the fact that China's GDP in 2011 was half of our GDP. If we are going to lead the clean energy race and create good-paying jobs for Americans, we must invest in our renewable energy infrastructure.

Last year the Senate Energy Committee heard testimony regarding a report from the American Energy Innovation Council's report entitled ``Catalyzing Ingenuity.'' The report, authored by former Lockheed Martin CEO Norman Augustine, Microsoft founder Bill Gates, and other business leaders, states:

The country has yet to embark on a clean energy innovation

program commensurate with the scale of the national

priorities that are at stake. In fact, rather than improve

the country's energy innovation program and invest in

strategic national interests, the current political

environment is creating strong pressure to pull back from

such efforts.

This is very important. I encourage my colleagues--especially those who oppose Federal funding for clean energy--to read this report because what people often forget is that this is nothing new. Government has always supported strategic energy priorities. As Mr. Augustine noted in his testimony, commercial nuclear power was the result of government investments in naval reactors. Do you know why natural gas is transforming our energy sector today? It is because of years of Federal support to develop hydrofracking technology. The Eastern Gas Shales Project was an initiative the Federal Government began back in 1976, before hydrofracking was a mature industry. The project set up and funded dozens of pilot demonstration projects with universities and private gas companies that tested drilling and fracturing methods. This investment by the Federal Government was instrumental in the development of the commercial extraction of natural gas from shale. In fact, microseismic imaging--a critical tool used in fracking--was originally developed by Sandia National Laboratory, a Federal energy laboratory.

The industry was also supported through tax breaks and subsidies. In fact, Mitchell Energy vice president Dan Stewart said in an interview that Mitchell Energy's first horizontal well was subsidized by the Federal Government. Mr. Mitchell said of the Department of Energy:

DOE started it, and other people took the ball and ran with

it. You cannot diminish DOE's involvement.

So the basis of the natural gas revolution that is helping make America more energy independent can be traced back to Federal support. In the same way, we must support the renewable energy sector now. We need to be the ones--our country, the United States, Americans--we must be the ones who sell this transformative and environmentally friendly technology to other nations. We must do this.

We need to start by having a conversation about climate change. It would be irresponsible to avoid the issue because it is uncomfortable to talk about. The stakes are too high and we would be shirking our responsibility to our constituents, to our children, to our grandchildren, and to posterity. The discussion is not going to be easy because there are going to be painful tradeoffs. I certainly don't have all the answers. I do know we need to have the conversation. We cannot leave this issue to future generations. I have a grandchild on the way--my first. I don't want to look back and tell him that when his grandfather was in a position to do something about climate change, he chose not to because it involved some politically difficult choices. I don't want to tell him that we compromised our moral integrity for political expediency.

We all have constituents who care about this issue. When I go back to Willmar, MN, I want to tell my constituents who met in a church and spoke about climate change that we heard them. I want to tell them we are working together across the aisle to talk about and address one of the most difficult problems we face.

I invite my colleagues to join in this endeavor and make dealing with climate change a bipartisan issue. We owe it to the Nation and to future generations.

I yield the floor.

Mr. President, I also agree we should not invade Canada. I live right near there. It would be terrible.

What we are hearing and what we have heard now for a number of months is a discussion about deficit reduction, about how we proceed and how we address the fact that this country has a $16.6 trillion national debt. That is a serious issue.

I think as we contemplate how we address this issue, we have to put it into a broader context as to what is going on in the United States. What is the best way forward in terms of deficit reduction at a time when the United States has by far the most unequal distribution of wealth and income of any major country on Earth. In other words, we cannot talk about how we proceed with deficit reduction, we cannot say it is OK to cut Social Security or Medicare or Medicaid or nutrition programs when the middle class of this country is disappearing, poverty is extremely high, while at the same time the wealthiest people and the largest corporations are doing phenomenally well. Any serious discussion about deficit reduction has to include those issues.

Let me bore you for a moment with some interesting statistics. This, in fact, came out just yesterday from the Pew Research Center. What they said is that all the new wealth generated in this country from 2009 to 2011 went to the top 7 percent of the American households. All the new wealth went to the top 7 percent of American households, while the bottom 93 percent of Americans saw a net reduction in their wealth.

The Pew Research Center found that from 2009 to 2011, the mean net worth of American households in the top 7 percent rose by 28 percent, while the mean net worth of the bottom 93 percent of American households went down by 4 percent; in other words, the people on top are doing very well, everybody else is not doing well.

Over this same time period, the top 7 percent of American households saw their wealth increase by a combined $5.6 trillion--the top 7 percent, $5.7 trillion in wealth increase; the bottom 93 percent saw a wealth decline of $600 billion. That is what the Pew Research Center reported just yesterday.

Today, when we talk about distribution of wealth and income, the wealthiest 400 individuals in this country own more wealth than the bottom half of America. Four hundred people have more wealth than the bottom 150 million Americans. Today, one family, the Walton family-- owners of Walmart--own more wealth than the bottom 40 percent of the American people; one family has more wealth than the bottom 40 percent.

Today--and this is truly a remarkable fact which of course we do not talk about too much--the top 1 percent of Americans own 38 percent of all financial wealth. Let's guess what the bottom 60 percent of the American people own. The top 1 percent own 38 percent of the wealth. The bottom 60 percent own 2.3 percent of the wealth in America. That is a rather remarkable and disturbing fact.

Today, as Warren Buffett has pointed out, the 400 richest Americans are now worth a recordbreaking $1.7 trillion, more than five times what we were worth just two decades ago. Meanwhile, according to a June 2012 study from the Federal Reserve, median net worth for middle-class families dropped by nearly 40 percent from 2007 to 2010. That is the equivalent of wiping out 18 years of savings for the average middle- class family.

That is distribution of wealth. That is incredibly unequal, incredibly unfair, and getting worse and worse. That is something we might want to keep in mind when we talk about how we do deficit reduction.

Then when we talk about distribution of income, what we earned last year, that is even worse than distribution of wealth, as bad as that is. If you can believe it, the last study we have seen on this subject--this is quite amazing--showed that from 2009 to 2011, all the new income created during that time period went to the top 1 percent while the bottom 99 percent actually saw a decline in their income. All the new income created in that time period, 2009 to 2011, went to the top 1 percent. Real unemployment today is not 7.6 percent, it is 13.8 percent if we count those people who have given up looking for work and those people who are working part-time. The youth unemployment rate is just horrendous, and it is even higher than the general average.

Very interestingly, a new poll came out by Gallup that was done just a few days ago--April 17, 2013. I find the results of that poll very remarkable. This poll deals with an issue that very few people in Congress are even prepared to talk about, let alone act upon.

Here is what the poll from April 17, 2013--this week--said: About 6 in 10 Americans--about 60 percent--believe money and wealth should be more evenly distributed among a larger percentage of the people in the United States, while only one-third of Americans think the current distribution is fair.

So when my friends want to cut programs for the middle class and give tax

breaks to the rich, they should understand that about 60 percent of the American people already believe that we have an unfair distribution of wealth in America. What is even more interesting, according to this Gallup poll from a few days ago--and they do this poll every year--is that a recordbreaking 52 percent of the American people believe ``that our government,'' i.e, the Congress, ``should redistribute wealth by heavy taxes on the rich.'' Again, that is 52 percent of the American people who believe that.

How many Members of the Congress get up and come close to reflecting what a majority of the American people want? The American people know that the middle class is collapsing. They know poverty is unacceptably high. They know the wealthy and large corporations are doing extraordinarily well, and they want us to do something about it. But around here, forget doing something about it. We cannot even talk about what the American people want us to do.

The American people are frustrated with Congress for a whole lot of reasons, and certainly at the top of the list is how we are ignoring the economic reality facing the middle class of this country and the growing wealth and income inequality. They want us to do something about it, and I think it is high time we did.

So instead of cutting programs for the middle class, they are giving more tax breaks for those people who don't need it. Maybe we should do what the American people want and ask the wealthy and large corporations to start paying their fair share of taxes and protect working families.

Interestingly enough, we hear from the wealthiest people in this country and from their organizations. What we hear from them is not: Hey, we are doing really well. We know this country has a whole lot of problems, and we are prepared to pitch in; we are prepared to help out with deficit reduction. By the way, for those who are on Wall Street, remember that it was the American people who bailed out Wall Street. Instead of hearing how they are prepared to reciprocate now in America's time of need, unfortunately what we are hearing is quite the contrary.

Lloyd Blankfein is the CEO of Goldman Sachs, and this is what he said on November 19, 2012, to CBS:

You're going to have to undoubtedly do something to lower

people's expectations--the entitlements and what people think

that they're going to get, because they're not going to get

it.

Blankfein and his friends at the Business Roundtable recently came out with a report. Now, the Business Roundtable is the organization representing the CEOs of the largest corporations. All of them make millions of dollars a year in salary or benefits. All of them have very generous retirement benefits. Some of them are worth hundreds of millions of dollars.

These people, the Business Roundtable, which consists of Wall Street and other large corporations that are doing phenomenally well, came forward and said to Congress: You should raise the eligibility age for Social Security and Medicare to 70 and cut Social Security COLAs by adopting the so-called chained CPI. The wealthiest people are doing phenomenally well, Wall Street gets bailed out by working families all over this country, and then these guys come back to Congress and say: Raise the retirement age for Social Security and Medicare to 70 years of age.

Needless to say, my views are a little bit different than Mr. Blankfein's or the Business Roundtable. I believe the way to do deficit reduction is not by punishing people who are already hurting and struggling to keep their heads above water. We don't punish the sick, the kids, the elderly, or disabled veterans. We need to ask those people who are doing very well to start paying their fair share of taxes.

Now I will talk about what I think we should be doing and why we should be doing it. In 1952, 32 percent of all of the revenue generated in this country came from large corporations--about one-third of all the revenue. Today just 9 percent of Federal revenue comes from corporate America. In 2011, corporations paid just 12 percent of their profits in taxes. That is the lowest percentage since 1972.

In 2005--the last figures we have--one out of four corporations paid no Federal income taxes at all even though they collected over $1 trillion in revenue during that 1-year period.

In 2011, corporate revenue as a percentage of GDP was just 1.2 percent lower than any other major country in the OECD, including Britain, Germany, France, Japan, Canada, and many other countries. Each and every year corporations and the wealthy are avoiding more than $100 billion in U.S. taxes by sheltering their incomes in the Cayman Islands, Bermuda, and other offshore tax havens.

So the point is: How do we do deficit reduction? Do we say to an elderly woman in the State of Vermont who is trying get by on $14,000 or $15,000 a year that we are going to cut her Social Security?

Do we say to a disabled vet: Thank you for your service and your sacrifice for this country, we are sorry you lost your legs, but we are going to have to cut your benefits?

Do we say to a struggling low-income family trying to survive on one or another nutrition program: Sorry, but you may have to go hungry and not get dinner on Wednesday?

Do we say to working people who have lost their jobs: We are going to have to cut your unemployment compensation which will make it almost impossible for your family to survive?

Is that our approach or do we go to corporate America, which is enjoying recordbreaking profits?

One out of four corporations pays nothing in taxes. Do we say to them: You know what, it is time you helped us with deficit reduction.

I hear a lot of my Republican friends and the President talking about how we need tax reform, but we are going to do it deficit neutral. No, I beg to differ. We do need tax reform. We do need to end the absurdity of losing huge amounts of money because of the tax havens in the Cayman Islands and Bermuda and elsewhere, but we also have to raise revenue when we do tax reform. It is not simply lowering tax rates.

I will give some examples about how absurd the current situation is and why--before we cut Social Security and before we attack programs that the middle class and working families of this country depend upon--we have to end these absurd loopholes corporate America is enjoying.

I have just a few examples. Bank of America is one of the financial institutions that was bailed out by the American people when their recklessness and greed almost resulted in the collapse of our financial system. In 2010, Bank of America set up more than 200 subsidiaries in the Cayman Islands, which, of course, has a zero percent tax rate to avoid paying U.S. taxes. Bank of America set up 200 subsidiaries in the Cayman Islands. In 2010, not only did Bank of America pay nothing in Federal income taxes, but it received a rebate from the IRS worth $1.9 billion that year. Bank of America paid nothing in taxes.

In 2010, JPMorgan Chase operated 83 subsidiaries incorporated in offshore tax havens to avoid paying $4.9 billion in U.S. taxes. They avoided paying $4.9 billion.

Goldman Sachs is one of the largest institutions in the country. In 2010, Goldman Sachs operated 39 subsidiaries and offshore tax havens to avoid an estimated $3.3 billion in U.S. taxes.

Citigroup, which is another financial institution that was bailed out by the taxpayers of this country, has paid no Federal income taxes for the last 5 years. That is not bad. Many people who are out there watching this are saying: That is pretty good. How did they avoid paying income taxes when they are one of the largest corporations in America for a 5-year period? That is pretty good.

During the last 5 years General Electric made $81 billion in profit, which is not too shabby. Not only has General Electric avoided paying Federal income taxes during these years, it received a tax rebate of $3 billion from the IRS. GE has at least 14 offshore subsidiaries in Bermuda, Singapore, and Luxembourg for the purpose of avoiding U.S. income taxes.

Does anyone still want to know why the American people are cynical about what is going on in Washington? Does anyone want to know why the Congress of the United States has an extremely low level of support or favorability? It is because the American people know they are getting ripped off. They are

working 50 or 60 hours a week, and they are paying their taxes. General Electric makes $81 billion, and over the last 5 years they have paid nothing in taxes. Does anybody vaguely think that is fair?

We have some people who say: We want to do tax reform, but we want to make it revenue neutral. We don't want any new income in order to help us with deficit reduction. Let's cut Social Security, Medicare, Medicaid, education, but, no, we cannot get new revenue from large corporations.

During the last 5 years Verizon made over $48 billion in profits. Not only has Verizon avoided paying Federal income taxes during those years, it received a $535 million rebate from the IRS--not too bad.

From 2008 through 2010, not only did Honeywell avoid paying Federal income taxes, it received a $34 million tax refund from the IRS.

Merck is a pharmaceutical company. In 2009 not only did Merck pay no Federal income taxes, it received a $55 million tax refund from the IRS. On and on it goes: Corning, Boeing, Microsoft, Caterpillar, Cisco, Dow Chemical. I have example after example of large profitable corporations where CEOs make millions and millions of dollars, and they say to the American people: We support cuts in programs for you--Social Security, Medicare, Medicaid, you name it--but don't ask us to pay more in taxes.

This Senate has a decision to make: Do we occasionally--I am not asking for much--stand up to the lobbyists, campaign contributors, and big money interests and ask the large corporations and the wealthy who are doing phenomenally well to help us with deficit reduction or do we continue to stick it to the working families and the middle class of this country? That is the challenge and the issue we face. I hope we have the courage to do the right thing.

With that, I yield the floor.

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

Madam President, this week I joined my colleagues in introducing immigration reform legislation that seeks to end de facto amnesty by achieving the strongest border security enforcement measures in U.S. history but also by modernizing our legal immigration system so it can unleash the strong economic growth and job creation potential that immigration has.

Let me begin by stating the obvious, and that is that America is a nation of immigrants. We know that because every single one of us can track our lineage back to someone who came here from somewhere else. The truth is it is one of the things that make us different and special from the rest of the world.

If we think about the history of the world, it is basically people being told

they can only do what their parents did for a living. How far you are going to go in life depends on what your parents used to do and who you are and to whom you are connected. What made America truly unique and what made the idea of America truly revolutionary was the idea that every single human being, no matter where they were born, how they were born, into what kind of family they were born, and into what circumstances they were born, had the God-given right to go as far as their talent and their hard work would take them. We may take that for granted--those of us, like me, who were born and raised here our entire life--but this is the exception rather than the rule throughout human history, and it is one of the things that have made America so special because the belief and commitment to that ideal unleashed here the revolutionary power of the human spirit and transformed this country into the single most powerful and greatest and freest Nation in all of human history.

This is the story of immigration in America, and it is why we as Americans understand that legal immigration is critically important for our future and a critical part of our heritage. The problem is that for too long both Republicans and Democrats have failed to enforce our immigration laws, and the result is that today we have millions of people living in the United States in violation of our immigration laws. The other problem is that our legal immigration system is broken. It is just broken. It doesn't reflect the 21st century. It doesn't take into account special skills and talents. It doesn't allow us to attract the world's best and brightest. In fact, it doesn't allow us to keep the world's best and brightest, many of whom are students in our universities who learn from our best schools--that our taxpayers are paying for--and when they are done learning, we ask them to leave and take what they have learned here and use it somewhere else to compete against us. It makes absolutely no sense.

Let me start by saying that if there wasn't a single illegal immigrant in the United States, we would still have to do immigration reform because the immigration system is broken. I am pleased this bill we have offered as a starting point reforms our legal immigration system in a very serious and profound way. It turns it into a merit- based system that takes into account skills, talents, and job opportunities. It creates a system where agriculture can get the workers into this country legally--by the way, workers who feed not just our families but the world. It allows our business community, in times of labor shortages where there is very low unemployment, to be able to provide for themselves the kind of guest and seasonal labor some industries depend upon but to do so in a legal way. These reforms are significant.

By the way, in the high-tech industry, where we are not graduating nearly enough people in the high-tech fields--science, engineering, technology, and math--shame on us as a country that more of our children are not graduating with the skills they need to do those jobs. We have to change that.

In the meantime there are thousands of jobs that are going overseas because we can't fill them here. These companies in the high-tech industry are creating these jobs, but then they are taking them somewhere else because that is where the workers are. It is pretty simple: They go to a university, they interview the students, they find someone they like, and if they can't hire them in the United States they will hire the same person in some other country. And that is terrible for America.

So this bill modernizes our illegal immigration system--something we would have to do even if there wasn't a single illegal immigrant in the United States.

Next, the bill actually enforces our laws. It begins by creating a universal entry-exit tracking system.

You may not know this, but 40 percent of the people who are illegally in the United States didn't come illegally. They came on a visa, on a permit, and then the permit expired and they stayed--40 percent. We have no idea who they are because we don't track people when they leave. We only track them when they come in. This bill will change that.

We all understand the magnet for illegal immigration. It is jobs. It is pretty simple: There is a supply of people willing to work, there is a supply of jobs on this side of the border we can't fill domestically, and those two are meeting. They are just not meeting legally.

This bill will require every employer in America to comply with E- Verify, to basically check the documents their workers are providing against the national data base that provides employment eligibility information. The next thing it does on enforcement is the border region--let me say this about the border. The border is not just about immigration. It is about national security. It is a national security risk. The border must be secured.

This bill requires the Department of Homeland Security to come up with not one but two plans--a border plan and a fencing plan--to achieve 100 percent ability to be aware of the entire border and 90 percent apprehension, that we apprehend 9 out of 10 people who are illegally crossing. We give the Department of Homeland Security 5 years to reach that goal.

If they do not reach the goal in 5 years, then the issue is turned over to a commission made up of State officials, local officials on the border to take care of the job themselves--and they will. If the Federal Government refuses to secure the border, the States of New Mexico and Texas and Arizona and California, through their Governors and their leaders, will finish the job.

The next thing this bill does is deal with the millions of people who are in this country in violation of our immigration laws. Let me begin by saying this: No one has a right to illegally immigrate to the United States. There is no legal right to be here illegally. As a sovereign country we have a right to enforce our immigration laws.

If we do something to accommodate those who are here illegally, we don't do it because we legally have to. We do it for two reasons: First, because it is in the best interest of our country. When we debate this immigration issue, we need to understand that when we talk about millions of illegal immigrants, this is not a theory, this is a reality; they are here now. We are not talking about bringing these people in; they are already here and they will be here for the rest of their lives. So we have to deal with that reality. It is in our national interest to deal with that reality.

The second reason we are dealing with it is because that is who we are. We are a compassionate people. We are not going to deport 11 million people, so we have to deal with this. We believe we handled this in a very professional and effective way.

If there are people in this country illegally who entered here before December 2011, they have to present themselves. They will undergo a background check. If they have committed serious crimes in the U.S., they will be deported. If they have not, they will have to pay an application fee, a fine. They will have to start paying taxes, and they will receive a permit that will allow them to work in the United States and pay their taxes.

They will not qualify for any Federal benefits--no welfare, no ObamaCare, no food stamps--but they will have a chance to work and will no longer have to hide. They are going to have to remain in that system for 6 years, and then they have to go back and get their permit renewed. It is not a permanent grant of a temporary status; it is a temporary grant of a temporary status.

In 6 years they have to go back and apply again for this permit. When they reapply, not only do they have to pay another fine and another application fee, but they are going to have to prove they have been paying taxes the last 6 years and that they are gainfully employed in a way that means they are not going to wind up on public assistance.

If the border plans have been completed, if E-Verify is in place, if the entry-exist system is in place, assuming their permit is renewed, after 10 years has gone by, then the only thing that happens is they are given a chance to apply for a green card just like everybody else does, not a special process. They are at the back of the line. Everyone who applied before them legally goes first.

The only thing that happens after 10 years goes by and the border is secured, E-Verify is in place and the entry-exit system is in place, we don't give them anything. All they have now is the opportunity to apply for a green card.

By the way, during the first 5 years of a green card under existing law, people don't qualify for Federal benefits either. The point is, this is a reasonable way to deal with a real problem that faces our country.

The alternative is to do nothing, which leads me to one of the points that people are using, and we will be talking a lot about this issue. One of the arguments against this is how much money it is going to cost.

First of all, over the first 10 or 15 years, all these things about the fence and the things we are doing are paid for in the bill. Beyond that, as far as the economy of the United States--a couple points.

First of all, we can't compare this bill to nothing. We have to compare it to what we have now, and what we have now is worse. What we have now is costing our economy. We have people in this country illegally. They get sick, they go to the emergency room, and the taxpayer pays for it.

We have people in this country who are having children who are U.S. citizens and they go to our schools; they are driving on our streets without a driver's license, which means they have no car insurance, which means all of us have to pay more in car insurance as a result. This is obviously not good for them, but it is not good for us.

What we have today is devastating and horrible for our economy. We can't continue to have this. We have to fix this problem, and we have to fix it in a way that is fair to the people who have done it the right way and fix it in a way that makes sure this never ever happens again. I believe the bill we are working on does that, and I look forward to the input that my colleagues have.

One more criticism I hear is that it is being rushed through. That is just not true. Just yesterday we voted on a series of amendments that I had less than 12 hours to review, and these amendments dealt with a fundamental right to Second Amendment constitutional rights. This bill has been online for 48 hours. The Committee on Judiciary would not even begin to consider amendments to this bill until next month. People are going to have 3 to 4 weeks to review it. It is posted on my Web site. People can go on there now and see it. It will be available all these weeks. Then it is going to go through an extensive committee process. Then it will be brought here, hopefully, to the floor of the Senate where we can debate it openly as well.

I am not claiming the bill is perfect. I am sure it can be improved, and I hope my 99 other colleagues will work hard to improve it because we have an opportunity to do something important.

My last point, and I address many of my fellow Americans who share my deep commitment to upholding the Constitution of the United States, to limiting the size and scope of government, to encouraging the free enterprise system as the best way to create economic opportunity. America is a nation of immigrants, but both Republicans and Democrats have failed to enforce our immigration laws and, as a result, we have millions of people here illegally. We are not going to deport them. So let's secure the border and let's identify these people. Let's have them undergo a background check, get in the back of the line, pay a fine, and pay taxes. No Federal benefits.

We all wish we didn't have this problem, but leaving it the way it is is amnesty. We have to solve this problem, and I hope we will.

Madam President, I yield the floor and I suggest the absence of a quorum.

Mr. President, I thank my colleague from Tennessee for coming to the floor. He has been here with some frequency together with the Republican Senator from Wyoming to discuss the matter which is pending before the Senate.

What is pending before the Senate is known as the Marketplace Fairness Act. It is a measure which Senator Enzi of Wyoming has been working on for 12 years and one on which I have worked with him for several years. It is an interesting issue because it is one where the Supreme Court challenged Congress 20 years ago. The States went to the Supreme Court and said: We want those who are not physically present in our State, but sell in our State, to collect sales tax. At that time the Supreme Court in the Quill decision said no; this is up to Congress. Congress needs to take action.

Here we are 20 years later and the conversation has changed dramatically. What used to be sales by mail or catalog are now Internet sales, and they are growing in volume by the day. States are finding themselves in a challenging situation.

States pass sales taxes. Senator Alexander was Governor of Tennessee. The State decided on a State sales tax. They say to every business in the State--as Senator Manchin understands because he was Governor of West Virginia--every sale you make over the counter collects sales tax for West Virginia, Tennessee, or in the State of Illinois. Those merchants understand their legal responsibility, their civic responsibility, and they collect the sales tax, remitting this amount back to the State.

The problem they now have discovered is what is known as showrooming. Store owners have described this as a situation where a customer shows up and requests to look at running shoes--this happens at Chris Koos running sports shop in Normal, IL. The customer will say: These look good, but do you have them in a different color? Staff goes back and gets another box of shoes for the customer who tries them

on. Then they will say: This looks great but do you have a wider one? Yes, that is perfect. That is the shoe I want. Let me write down the information about the shoe.

The customer will then turn around, go home, and order the shoe on the Internet. The local merchant who did all of the work, who displayed the merchandise, pays the rent, pays the taxes, receives nothing. The person buys it over the Internet because many Internet retailers do not collect sales tax.

In my State this might be 8, 9 or 10 percent difference. Chris, my friend, the mayor of Normal, told me it is not unusual 2 weeks later for them to come back in with the shoes purchased over the Internet and say: These didn't turn out right. He reminds them they didn't buy the shoes in his store.

This is a story repeated over and over. The brick-and-mortar retailers, the shops on Main Street, and the malls feel they are at a great disadvantage. If their competition on the Internet is not collecting sales tax and they are, it puts them at a competitive disadvantage.

In all of the States with a sales tax, approximately 46 States, if I am not mistaken the purchaser over the Internet has a legal responsibility to pay the sales tax. Most people don't know this. In my State of Illinois people are supposed to pay it when they file their State income tax. There is a line: How much do you owe for sales tax and use tax for remote purchases on Internet purchases?

Several months ago I was reminded by my bookkeeper this line was on the form. I said I should take a quick look to see what I owe.

One in twenty people in Illinois fill out this line. We have about 95 percent of the taxpayers in my State who put zero. We know it is more than 5 percent of the people living in Illinois who are purchasing over the Internet. This tax is not paid.

What this bill says is we don't create any Federal tax; no, none at all. We don't create any new State or local tax, none at all. What we do say is States can give the software to these Internet retailers to collect the tax when people make the purchase.

I recently bought a book on amazon.com, put in my address, ZIP code, and they calculated instantly how much I owed in sales tax on that purchase. I paid it and the money was emitted to the Illinois Department of revenue. They are doing this even though there is no legal obligation for them to do so. More and more companies such as Lands End--I called them. They said: We collect sales tax.

More and more companies are doing so, but this would make it uniform. We wrote this law understanding there are some small Internet retailers who perhaps sell several hundred or several thousands of dollars' worth of goods in the course of a year. We exempt them. They don't have to collect the sales tax if their revenues from the previous year are below $1 million. We exempt them. That is to put no hardship on the small retailers but to go after the 1 percent with sales in excess-- revenue in excess of $1 million. We go after them to make them pay what they should.

This is what is pending before the Senate. It has been a long time coming. We have been working with retailers across America to accomplish this. They have said this will give them a level playing field when it comes to sales. The same sales tax is collected over the counter which is collected over the Internet. This is the way it works and at no expense to the retailer.

The States need to provide the software for the collection. They are not going to be held responsible if the State gives software which is imperfect. They can't be held responsible for it. If they use the software given to them, they have met their legal obligation. This is what is before us.

We have had two votes now: one a symbolic vote on the budget and another a procedural vote to move forward on this measure yesterday, which 74 Senators voted for, which is pretty substantial in a body of 100 Senators. All but 5 of the Democratic Senators support it, and a substantial number, 24 or 25 Senators, from the Republican side support this, more than half of their caucus.

We are on this measure now. I have said to my colleagues, and I believe Senator Alexander said to his Republican colleagues: If you have an amendment which is relevant and material to this bill, bring it to the floor. Let's get into a debate. Let's talk about these amendments. Let's vote on these amendments, and then let's move to final passage.

Those who will witness this will see a rare occurrence on the floor of the Senate--perhaps an actual debate and vote on an amendment. It doesn't happen very often around here. So you may wish to stay tuned. I encourage all of my colleagues interested in this issue who believe they would like to offer some form of an amendment to please bring it to the floor as soon as it is ready, which I hope will be today. This is our last week in session before we break for a week. We want to get this bill done. We started early in the week--on Monday, yesterday--and we want to get it done by Friday. If we have to stay over, we will stay over--Saturday, whatever it takes. We want to get this done before this break, and it now depends on my colleagues.

Those who are sitting on an idea, it is time to let it hatch. Bring it to the floor, and let's have a vote on it or let's talk about it. It may be something we can accept. If it is, we will try. If it isn't, we will bring it up for a vote and let the Senate decide. We want to act as a Senate because we have a good bipartisan measure, Senator Heitkamp of North Dakota and I, joining on the Democratic side along with quite a few others, Senators Enzi and Alexander on the Republican side.

I urge my colleagues and staff who are following this debate, now is the time. If you have an amendment, bring it to the floor today, right now. We will be here to receive those amendments and to work on them.

Mr. President, I yield the floor.

I thank the Senator from Tennessee for posing that question, and through the Chair I would say to him that I am in a tough position here facing two former Governors--Governors of West Virginia and Tennessee--but I am sure they agree with what I am about to say.

In this circumstance, the decision was made by the State of Tennessee--and West Virginia as well--as to what the sales tax would be by the people living in the State and making purchases in the State. We don't change that at all. That is up to the States to decide.

As I mentioned, four States, maybe five States, when it comes to sales tax, have no sales tax. What we are putting in this bill will not change that in any way. If you live in Oregon, you will pay no sales tax because of this bill for what is sold over the counter or over the Internet.

Our friends from Delaware are supporting this bill because they think because they are a no-sales-tax State surrounded by Pennsylvania and New Jersey and Maryland, they are going to have an advantage. They believe people will cross the borders to buy in Delaware. So they have calculated this actually helps them.

But we are respecting the decisions made by each State as to the taxes that will be imposed. We are doing it on a fair and equalized basis for those who have brick-and-mortar stores as well as those over the Internet. And I would say that is consistent with the 10th Amendment and consistent with States rights in this area.

Responding to the Senator from Tennessee through the Chair, he is right. And this has been controversial. I can remember that in the last debate--and it was a few years ago--the argument being made was that we should have free access to the Internet. I don't quarrel with that. The Internet has been a powerful force in our economy. It is going to grow as a force in our economy, and I don't believe we should tax access to the Internet. There are also a myriad of bills related to services over the Internet and whether they should be taxed. We do not get into that in any way whatsoever. What we are talking about are taxable goods by State law subject to State sales taxes as they currently exist. We don't change those taxes in any way.

A point that was raised in our press conference is an important one. Some States treat food differently, prescription drugs differently. The State has to basically tell the retail community what the State standard is going to be for the categories of goods that are being sold. So we make it as easy as humanly possible for the Internet retailers, providing at the expense of the State the software they need to make this work.

I would say to the Senator from Tennessee through the Chair that there are two possibilities:

We continue under this current system, which works a disadvantage on the Main Street stores and shopping malls and denies to those units of government the revenue that would otherwise be coming from the sales tax. That would be one outcome.

The second outcome is--and Senator Heitkamp has mentioned it--this case may return to the Supreme Court. If it returns to the Supreme Court, it is quite possible it won't be written as mercifully as our version. We have exempted--we have exempted Internet retail sellers with revenues the previous year below $1 million. We have tried to lean toward an accommodating approach. I don't know if the Supreme Court would reach the same decision when it comes to sales tax liability. I believe it is better for us to accept their challenge, even 20 years later, and get this done.

Responding to the Senator from Tennessee through the Chair, I listened to the speeches of our critics, and they were swooning over the notion of being subjected to 9,600 taxing districts, taxing entities. What the Senator from Tennessee has described is our answer. This bill avoids that problem. This bill simplifies that situation.

We are down to 46 States with the defined goods and the defined sales tax. That is more reasonable for the retailers than running the risk, as the Senator suggests, that this goes back to the Supreme Court, and 20 years after the fact they say: It is wide open. If Congress is not going to act, the Internet retail community has now matured to a point where they should be able to collect sales tax in every taxing entity where a person resides.

I believe that is a much more complex and challenging situation.

Mr. President, I ask unanimous consent to speak as in morning business as my remarks will not relate to the business at hand.

Mr. President, first of all, I wish to talk about the bill that is on the floor. I agree with Senator Franken--this is a bill that enjoys bipartisan support. We saw in the budget debate just how broad and how bipartisan that support is. It is the right thing to do. It is the fair thing to do. It is a situation where government no longer decides that one business located in a community that provides the police protection, the sidewalk, and whatever else one might use as one goes into a local store and looks something over, is disadvantaged over a business that is located somewhere else.

Also, there is a fundamental policy of the importance of having laws on the books that are actually enforced. In almost all the States--I think the number is somewhere near 37 or 38 States--this tax is currently due. This tax is supposed to be voluntarily paid, and winking and nodding on not paying this tax creates real concerns. I think in Missouri last year--a State where this tax is supposed to be paid as a use tax--300 people filed that they owed this tax and paid some of that use tax. Now, my absolute certain guess is that more than 300 Missourians received something in the mail at their house that didn't have taxes paid on it when they received it.

So my view would be that we should do one of two things: We should either take all of those laws off the books or determine a way where the laws that States have are actually able to be enforced by those States.

States have a right to decide, no, we don't want to be a part of this compact. We don't want to be a part of it. We don't want this sales tax revenue. We don't want to collect the money that is due on the same product in our State. But they also have the right to say, yes, that is our law, and we need to collect that tax, and we do not want to pick winners and losers.

From the point of view of some of the most conservative leaders in the country, including those who are in government--Al Cardenas, the chairman of the American Conservative Union, says:

When it comes to state sales taxes, it is time to address

the area where federally mandated prejudice is most

egregious--the policy toward Internet sales, the decades old

inequity between online and in-person sales as outdated and

unfair.

Governor Mike Pence from Indiana says:

I don't think Congress should be in the business of picking

winners and losers. Inaction by Congress today results in a

system today that does pick winners and losers.

Another Indiana Governor, Mitch Daniels, said:

Sales taxes that states impose ought to be paid, and paid

by everybody equally and collected by everybody in the retail

business.

Art Laffer, in a Wall Street Journal article just this week, said:

The principle of levying the lowest possible tax rate on

the broadest possible tax base is the way to improve the

incentives to work, save and produce--which are necessary to

reinvigorate the American economy and cope with the nation's

fiscal problems. Properly addressing the problem of e-

fairness on the state level is a small, but important step

toward achieving this goal.

Art Laffer--President Reagan's adviser on exactly that concept of having a tax that is fairly applied in the broadest possible way--is supportive of this, along with Mitch Daniels and Mike Pence and Al Cardenas and many other conservatives who have looked at this as both a fairness issue and an issue of simply providing a way that States are allowed to enforce their law.

Regulating interstate commerce is one of the principal reasons to have a Constitution and a Federal Government.

Essential Services Act

Mr. President, the other thing I would like to talk about is what happened beginning on Sunday in the country as people tried to travel when approximately 47,000 Federal Aviation Administration employees were furloughed, and furloughed in a way that created needless airport delays nationwide.

The announcement came on the heels of a report that the President has cut other public services, such as the self-guided tours at the White House. I cannot imagine how much the self-guided

tours at the White House cost, but I do know it was cut when for almost every school student in America who comes to Washington, one of the things they would like to see is the White House. So I guess there is some immediate pain involved there, just like there has been pain involved at airports since Sunday.

The airline industry was not even told until late last week that this was going to happen. This has been mismanagement, and intentional mismanagement. As late as September 28, the Office of Management and Budget sent out a notice to the entire executive branch of the government that said: Spend your money--this is for the spending year that begins October 1--spend your money like the law will not be obeyed. Suddenly, 6 months into the spending year, the spending caps, the budget caps, the amount of money that had been appropriated beyond that--it is twice as big a problem as it would have been October 1. Then you have to give notice to people that they are going to be furloughed, if that is the option you have taken, and it is a bigger problem than it needed to be.

During his sworn testimony before Congress last week, FAA Administrator Michael Huerta admitted that the agency has the flexibility under current law to transfer up to 2 percent of funding from one activity to another without congressional action, and also they could ask to transfer up to 5 percent--setting priorities--by asking Congress. It would be 2 percent without even asking Congress and 5 percent by asking Congress that could be transferred.

There was a serious discussion and an amendment offered early this year in the continuing resolution debate to give the agencies the authority they needed to set priorities between now and September 30. But the administration clearly said it did not want to be able to set those priorities.

The idea that any reduction in Federal spending has to create the maximum amount of pain is offensive to me. I think it is offensive to most Americans.

The FAA currently spends $2.7 billion annually on nonpersonnel costs. The day they started this, saving $600 million by furloughing employees, they announced $474 million of new grants for sustainable and livable communities.

I am actually for sustainable and livable communities, but this is a new program. It is a program that I would bet a considerable amount of money that if the Department of Transportation would have come to Congress and said: Could we spend this $474 million on keeping the airlines and the airports working--the freight that goes all over the country, the people who go all over the country to do business and create jobs--I will bet you Congress would have said: Absolutely, take that $474 million. Do not announce those new grants that you have not told anybody they have yet and use it to solve this problem, while we work to see if there are better ways to solve this problem.

Last week, I introduced the Essential Services Act as a standalone bill. I introduced that same act, in fact, during the continuing resolution debate. We were able to get a part of it into the continuing resolution for food safety inspectors.

But what the Essential Services Act says is that people who are essential to public health and safety have to show up for work. The basis for that is President Clinton, in 1995, on August 22, issued a letter, an excerpt from which I ask unanimous consent to have printed in the Record.

That letter from Alice Rivlin, the Director of OMB, says: Here are the people who have to show up for work if the government shuts down. The government did shut down, we all remember, in 1995, and these people did show up for work.

On April 6, 2011, it appeared we might have another government shutdown, and the Obama administration put out a similar letter based on the same groups of people. These are not hard people to identify, as it turns out. On April 6, 2011, the examples they gave of essential employees who would have to work would be: FAA employees who would keep the air traffic control system open, FEMA disaster operations would continue, Social Security checks would be sent out to beneficiaries, the National Weather Service alerts and forecasts would be maintained, the U.S. Postal Service would continue to collect mail and deliver mail, the Customs and Border Protection activity would continue, and the food safety inspectors would show up.

There is a list. Mr. President, I ask unanimous consent to have this notice from the Obama administration printed in the Record.

This is not very complicated. All the Essential Services Act says is that the people whom the government said had to show up if there is no money to run the government would also be the people who would be prioritized and would be allowed to show up if there is a 2.5- percent cut. Who can argue with that?

People are told: The weather is really bad today. If you think you have some risk to your person to get to work, do not come in. But these people are told: If you can possibly get to work, get to work. If the food safety inspector does not get there, 500,000 Americans could not work that day if they did not show up at every food safety facility where that one Federal employee has to be there for everybody to work. If the air traffic controller does not get there, and the runways are cleared off and planes can land and planes can take off, that may not happen if the air traffic controller is not there.

This says those people would not be subject to furlough under the new Budget Control Act. They would have the same priority on a day when there is a reduction in the funding for a Department that they had in the day when there was no funding for the Department. If people are told they have to show up when there is no money to run the government, surely those same people need to show up if there is a 2.5-percent reduction.

The definitions set by President Clinton and President Obama in their administrations are fine with me for this purpose. Washington is living outside its means today. Federal spending has skyrocketed 19 percent since 2008. The Federal debt is approaching $17 trillion. Clearly, we have to do something about spending, and we can do that without interrupting people's lives. We can do that by prioritizing what the government should do.

Last week, we had Mr. Huerta before the Commerce Committee that Senator Rockefeller chairs and Senator Thune is the ranking Republican. I think it was on Wednesday. There was no discussion that on Sunday we are going to start furloughs of air traffic controllers.

In the legitimate oversight responsibility of our committee, we are to be told by the FAA Director: Our plans are drawn up. We are about to execute them. I am here to testify before the Congress. I think one of the things I should tell you is that all kinds of flights are going to be delayed on Sunday and Monday because of this plan. It was not mentioned. Plenty of questions, even questions about how you were going to furlough employees, but no answers.

I encourage Americans to visit our Web site: bitly.com/cutwasteful spending. Let's find the things we can cut rather than finding things that you cut--from the White House tours, to vaccines for kids, to air traffic controllers, to border security guards. I hope we will do the right thing. I encourage Senator Reid to allow a vote on the Essential Services Act and prioritize the way we spend money.

Back to the start of my remarks, I am a proud cosponsor of the Marketplace Fairness Act. Senator Pryor and I intend to offer an amendment on that to just clarify current law, that we are not taxing use of the Internet; we are just having a fair tax for products people buy over the Internet.

I suggest the absence of a quorum.