Floor Statements

Madam President, I ask the chairman if it might be all right, and Members of his side, as well as other Members on this side, if I give my remarks--they are fairly lengthy--and if I proceed for 5 or 10 minutes and then yield to Senator Jeffords for his comments.

I may actually be lengthier than the chairman.

First, I thank the chairman for his brevity. I would then be happy before I complete my remarks to yield to other Senators who may be waiting. Since I will be here all the time, I can complete my remarks.

I am pleased to join the chairman of the Armed Services Committee, and my dear friend, Senator Warner, in urging the adoption of this conference report. The conference on this bill took 147 days to conclude, making it the longest conference on a defense authorization bill in the history of our committee. The agreement would not have been possible without the strength and the perseverance of Senator Warner.

This is a historic bill for another reason as well. This conference report includes two key Senate provisions that serve the fundamental needs of the men and women upon whom we now call and upon whom we have called in the past to fight our Nation's wars. These two provisions are the concurrent receipt provision added by the amendment of Senator Harry Reid on the Senate floor and the TRICARE provision added by the amendment of Senator Daschle on the Senate floor. Senator Warner's strong support was instrumental to the success on both of these issues. They simply could not have been achieved without the support of our chairman.

On concurrent receipt, the conference report would phase in full concurrent receipt of military retiree pay and veterans disability compensation for all retirees with disability ratings of 50 percent or greater. Currently, military retirees who receive VA disability compensation have their military retired pay offset by the amount of their VA disability compensation. The conference report would also expand the combat-related special compensation we enacted last year to reimburse all veterans for combat-related disabilities for any retired pay forfeited because of the prohibition on concurrent receipt.

I continue to believe it is unfair to require our disabled military retirees to forfeit earned retired pay in order to receive VA compensation for their service-connected disabilities. According to the Congressional Budget Office, the conference provision on concurrent receipt will benefit approximately 225,000 disabled retirees.

On TRICARE, the conference report would provide enhanced access to health care for members of the Guard and Reserve and their families, including TRICARE coverage that begins upon notification that a member of the Reserve component has been activated, TRICARE coverage that extends 6 months after release from active duty, and extended TRICARE benefits on a cost-share basis for members of the Reserve components and their families who do not have access to other health insurance coverage.

The citizen soldiers of our Guard and Reserve willingly place themselves in harm's way for their country. This is the least we can do to recognize their courage and their patriotism.

These two provisions address the fundamental needs of the men and women whom we now call upon and we called upon in the past to serve our country in uniform. They have something else in common, as well. Both of these provisions were included in the conference report despite the veto threat from the administration. On July 8th, the Secretary of Defense wrote to the conferees to state that providing these vital benefits to our veterans and to our Guard and Reserve would ``drain resources from important programs benefiting our military.'' The Secretary's letter stated if the President is presented with a bill ``authorizing concurrent receipt of military retirement pay and veterans disability compensation benefits or expands TRICARE, then I would join other senior advisers to the President in recommending that he veto the bill.''

As a matter of fact, as many will remember, the administration held up the enactment of last year's Defense authorization bill for several months and nearly stymied the bill because of the administration's opposition to concurrent receipt proposals similar to the language included in this year's bill.

The conference report before the Senate today contains both of these Senate provisions. This year, as last year, Senate conferees stood up for what they believed in despite the opposition of the administration. This year, as last year, we stood with America's disabled veterans, we stood with America's Guard and Reserve. Unlike last year, the House conferees agreed to go along with us. It was the right decision. I do not believe the President would have vetoed our conference report over these issues last year and I am confident he will not do so this year.

Again, I pay my respects to the chairman of our committee, because even though, as always, he is generous in giving credit to others for provisions in the bill, including his reference to Senator Reid which he accurately made, without his leadership these provisions simply would not be in this conference report. All of our veterans and all the men and women in our military are and should be in his debt for his leadership in this and so many other ways.

This bill contains a number of other important provisions for our men and women in uniform. These include provisions that would increase military pay by 3.7 percent across the board,

with targeted pay raises for midcareer personnel, raising the average increase to 4.1 percent.

It extends increased imminent danger pay and family separation allowances, authorizing a high tempo allowance of up to $1,000 per month for active and Reserve personnel who experience unusually high tempo. It doubles the death benefit to $12,000. It authorizes survival benefit plan annuities for surviving spouses of Guard and Reserve personnel who die during inactive duty training.

It removes skill requirement limitations for reenlistment bonuses for members who reenlist in Afghanistan, Iraq, or Kuwait. It authorizes full replacement for household goods lost or damaged during military moves. It expands commissary use privileges for Guard and Reserve members and their families. It provides supplemental impact aid to assist schools with large numbers of children of military families.

I am pleased the bill would increase authorized active duty end strength for the Army.

Madam President, I now ask unanimous consent that I be able to yield to our good friend from Vermont, and then I would offer others the opportunity to follow him if they wish. I can complete my statement at a later time.

Madam President, if the chairman will yield on that point.

My recollection is that on the Senate floor we did add a significant protection, a criteria before the Endangered Species Act would be ignored. That was under the Lautenberg amendment that we would require there be a conservation benefit provided as well as adequate funding provided if the Department of Defense was going to proceed.

The Senator from Vermont's recollection relative to the committee perhaps refers to what we did on the Senate floor, which he also referred to in his remarks, where we did add important protection that was missing when the bill came to the floor, but a very close vote on the floor added that protection.

I am not sure if that is what the Senator was referring to.

Again, if the Senator will yield, I think actually in the committee we were unable to do what the Senator from Vermont had actually urged us to do and which I totally agree with. I thank him for his comments, which I share.

I reach a different conclusion on how I will vote on the whole bill because of the other provisions in it, but I happen to agree with him in terms of his analysis on the Endangered Species Act and on the Marine Mammal Protection Act and the damage that I believe we have needlessly done to those statutes when we could have done some things which would have protected both the environment and the training of our forces.

But in any event, I think that probably is what the Senator from Vermont is referring to, although I am not sure.

If the Senator will yield, Senator Akaka has been here as well. Perhaps after the Senator from Colorado, then the Senator from Hawaii would be recognized for 15 minutes.

If we could add that.

I think we all appreciate that accommodation. I ask that accommodation be made without taking time away from the Senator from Colorado.

If Senator Allard would yield for 15 additional seconds.

I commend the Senator from Delaware. His leadership on this issue is what really led to the result which was achieved, which he so accurately described. We have taken a logical step. The House approach to it was surely the lift that was needed, but the Senator from Delaware added a great deal to it and brought to our attention repeatedly this issue. I am glad the result is as satisfactory as it is.

Senator Byrd is here and has been waiting. I want to see if we can figure out how to accommodate also Senator Dayton, I believe, tonight.

And perhaps Senator Nelson.

We are going to check with Senator Nelson at this point to see what his intention is. We believe Senator Bill Nelson wants to come tonight. Whether it is morning business or the bill, that should not be consequential although perhaps for some reason it might be. I want to finish my remarks also. Senator Pryor we want to accommodate in the morning, as we have spoken about. Perhaps we can work all this out as Senator Akaka has the floor.

Before Senator Collins is recognized, I thank Senator Akaka for his statement and, more importantly, for his service on the committee as ranking member of the Readiness and Management Support Subcommittee. That subcommittee has

some of the most difficult issues which we have had to deal with this year; a number dealt with in ways I did not particularly agree with, either. As the Senator from Hawaii indicated, he had concern on a number of them, as well. Without his service on that subcommittee, we would have had many more problems than we ended up having. We are very appreciative and grateful for the service he provided.

Mr. President, I wonder if Senator Byrd will yield for just one moment.

Mr. President, I thank Senator Collins. In her usual modest way, she has given much too much credit to others for something on which she deserves the lion's share of the credit, which is an outcome which is not what either she or I would have preferred but is far closer to that outcome than would have been the case but for the persistence and--I will add the word here--courage of one of our colleagues; that is, Senator Susan Collins of Maine.

The rights are protected here that are essential to employees that will lead to greater collaboration between employees and the Defense Department because of her tenacity. I salute her for it and commend her for it.

It was a pleasure to work with her, on a bipartisan basis, in the Governmental Affairs Committee on the bill to which she has referred. Her outline of what was accomplished is indeed an accurate outline. I will have more to say about that later. But in the meantime, I express my gratitude to her. I think all of us, those of us who were even unaware of the outcome in any detail, will someday understand the contribution Senator Collins has made to the personnel relations in this Government, particularly in the Defense Department.

While the chairman is on that point, Mr. President, I understand there will be two more Senators in addition to me on this side tonight who will have remarks on the bill.

Mr. President, I thank Senator Sessions for his service on our committee. He is one of the members of our committee who works extremely hard. I have traveled with him. I did not travel with him the last time he made reference to, but I know how committed he is to the men and women in our service. That is shown every day here, but it was also shown to me very dramatically on the trip we were able to take together, and we thank him. I know, more importantly, the men and women in the Armed Forces thank him for that commitment.

The Senator from New Jersey is in the Chamber. I am wondering if he might like to go next. Approximately how long does he plan on speaking?

If that would be all right with the chairman, I understand Senator Dayton is on his way and he would also like 10 or 15 minutes. Then I would try to make my remarks with an additional 10 minutes.

Mr. President, I wonder if we could establish order for Senators to speak.

We have been going back and forth. Senator Reid is ready to proceed for a couple of minutes. I wonder whether Senator Dole might allow him, for 2 minutes, given his responsibilities, to go first. Then we would go to Senator Dole, then back to Senator Dayton. Would that be all right with all the Senators?

Mr. President, if I could have 30 seconds before we file that. Let me thank Senator Lautenberg for his comments and assure him one of the reasons this conference lasted I think longer than any conference in history, 147 days, was because of those two environmental provisions which, until the end, many of us fought very hard against.

The House prevailed. There would not have been a conference report, basically, if we had just refused to give in on this. Ultimately we did not have the votes on this side to carry on in that particular course of action. But I assure the Senator from New Jersey I, as one Senator, agreed with his comments. The provisions that were in the House bill, however, ultimately prevailed. That is what happens with some of these conferences. We basically win some and lose some, and as far as I am concerned we lost on this one, and so did the world.

The chairman is correct on that. I concur with our chairman. This problem is not the one we have run into recently as much as it is a problem of a very great difference between the Senate provision, which the Senator from New Jersey helped to author, and that of the House. His amendment was a very important amendment and put us on the right track. But we ran dead on to the House provisions. In this case it was the House provisions versus the Senate provisions, rather than additional provisions in conference which were the problem.

Mr. President, if I could ask Senator Dole to yield for just 1 additional minute, I want to thank the Senator from Nevada for his leadership in this area, and for his kind remarks. But let it be very clear. The Senator from Nevada has led the fight on this concurrent receipt issue. Two-hundred and twenty-five thousand retired disabled veterans are going to now be able to receive their disability benefit as well as their retirement compensation because of his leadership. There are others, obviously, who participated. There always are. The Senator from Nevada is very generous in sharing that credit.

Surely our chairman, Senator Warner, deserves a great deal of credit, as others here deserve credit, along with Senator Reid. I know Senator Warner will agree with me. As he just pointed out, Senator Reid has truly been a leader in this effort. It would not have happened without his leadership. There are 225,000 veterans and their families out there tonight who will receive this benefit which they have earned and deserve who otherwise would not have received it.

I am sure the President will sign this bill, even though at one time it was suggested that the Secretary of Defense would recommend a veto. I can't believe that will now, in fact, happen. I thank the Senator for his leadership.

Mr. President, let me join Senator Warner in thanking Senator Dayton, first for the very overly generous comments he made at the beginning of his remarks. They are obviously very warm and very much appreciated. The references he made to the former colleagues of ours are particularly important personally to both Senator Warner and to me, and we are very grateful for them.

Senator Dayton has brought to our committee and to this body a very great passion, not just for Minnesota--although Lord knows that passion is there for issues that affect Minnesota, including his Guard and Reserve that are so close to his heart--but also the defense issues that affect every citizen of this Nation. Perhaps typical of him was the way in which he identified, with a number of other colleagues, a problem for the service men and women who are coming back on leave from Iraq and who are dropped off at Baltimore Airport and have no way to get to their homes. Senator Dayton joined a few others in this body to make sure in that supplemental appropriation we would get them home, not just to our shores but to their own personal homes.

That is the kind of personal approach he takes toward issues, a combination of great passion and tenacity and forthrightness and directness and guts and courage, taking on a lot of tough issues, but also a very personal approach. We are very glad he is on the Armed Services Committee and grateful for the contribution he makes to our committee.

If the chairman has no other matter, I thought what I would do is very briefly continue with a few comments. I began a rather lengthy statement I was going to make about the Defense authorization bill, and I have a few additional comments.

Where I left off a couple hours ago was making reference to the fact we increased the Active Duty end strength of the Army in this bill by 2,400. That is a small number, given the demands we are placing on our troops, but at least it gets us on the right road. Senator Jack Reed worked hard for this increase. Senator Warner and I in conference did the best we could, given the circumstances we faced and the limits we had to deal with. But Senator Reed was determined we would do what it is clear to all of us we must do and consider more of, which is to take a look at the huge demand we are placing on our troops, take a look at the sustained callups of our National Guard and Reserve components since the Vietnam war.

We now are watching them more and more deployed for extended periods and repeated deployments of the same Guard and Reserve units. We have to address this issue. There are many ways to do it, but one of them is to take a look at increasing the end strength of our Active-Duty people. We decided we would start this year with the Army where the greatest crunch has been felt. That 2,400 personnel increase authorized by this bill again is a relatively small increase given the demands on our troops, but it is an important statement of where this committee is.

We are also pleased the conference report includes a proposal which Senator Kennedy and others were very instrumental in proposing which would serve to expedite the naturalization of lawful permanent residents serving in the military, and their families. These are men and women in uniform who willingly put their lives at risk to preserve our freedoms. They deserve nothing less than full participation in those freedoms as citizens.

The expedited and naturalization of lawful permanent residents who do serve in the military, and also for their families, has been championed by Senator Kennedy and a number of other colleagues of ours. That provision is in our bill.

This conference report also addresses the Air Force proposal to lease, rather than buy, 100 new tanker aircraft. The Senate Armed Services Committee spent many hours trying to gauge the severity of the problems with the existing Air Force tanker fleet and the urgency of the requirement to replace those aircraft. In my view, the Air Force was deficient in the case they tried to make that there is an imminent risk to the fleet, but the Air Force did show a long-term requirement for tankers that will ultimately require the fielding of replacement aircraft.

At the same time, the Government Accounting Office, the Congressional Budget Office, and the Congressional Research Service all raised serious questions about whether the lease proposal presented by the Air Force was in the best interest of the taxpayers. According to these independent analyses, the tanker lease proposal was likely to cost the taxpayers as much as $5 billion more than a traditional purchase of the same aircraft on the same schedule.

After considering these issues, Senator Warner put forward an alternative approach under which the Air Force would lease 20 tanker aircraft and purchase the remaining 80 aircraft contemplated in the original lease agreement. I supported this creative approach. It would reduce the acquisition cost for aircraft by more than $4 billion dollars, while allowing the Air Force to acquire the full 100 aircraft that they say they need.

In order to help the Air Force with its funding problems, we agreed to authorize incremental funding of the 80 aircraft purchase, so that the Air Force can budget for aircraft construction costs in the year the costs are incurred, rather than obtaining full budget authority at the time the order is placed. Incremental funding is not generally a good idea, but it is a significant improvement over the lease approach originally proposed by the Air Force in this case.

I want to specifically point out the very creative role of Senator Warner in coming up with a solution which I was proud to support. This is his creative solution to a real problem. We have a need for new aircraft. The problem is the resources were not there for them. The right way to do this is purchase, not lease. We did the best we could to make it clear at the same time we acquire these aircraft, we want to do it with minimum damage to the usual procurement rules which require a purchase rather than a lease of equipment of this kind.

I was also pleased the conference report includes a Senate provision authorizing the expansion of the cooperative threat reduction program of the Department of Defense and the nonproliferation programs at the Department of Energy, outside of the former Soviet Union. That was the change we were able to make. This is the basically flowering of the Nunn-Lugar program. Senator Lugar, of course, who is still in this body, is the one who has promoted and prodded and pressed us to do this. He has been absolutely right on this program. They have proven to be important tools in helping to reduce the proliferation risk from nuclear, chemical, and biological materials in the former Soviet Union.

We give the President the authority which the President requested to continue the destruction of chemical weapons in Russia. It fully funds CTR programs. But at the request of the administration, with full support of Senator Lugar, who really was a leader in this, and the full support of our chairman and our committee, we have now for the first time, using the authorities in the agreement, allowed the President to use these cooperative threat reduction funds from the Department of Energy Materials Protection and Control Program to meet emerging threats in other parts of the world. It is no longer limited now to the former Soviet Union.

Again, Senator Warner's total support of this change was instrumental in making it happen.

I thank the chairman.

Finally, I am pleased that the conference report includes a Senate provision authorizing the expansion of the Cooperative Threat Reduction program of the Department of Defense and the nonproliferation programs at the Department of Energy outside the Former Soviet Union. These programs have proven to be important tools in helping reduce proliferation risk from nuclear, chemical and biological materials of the Former Soviet Union. This conference agreement also provides the President with the authority he requested to continue destruction of chemical weapons in Russia, and fully funds the CTR programs.

As we have all come to appreciate, however, the risk that nuclear, chemical and biological materials and knowledge will proliferate is not limited to Russia and the other States of the former Soviet Union. For the first time, using the authorities provided in this agreement, the President will be able to use CTR funds, and funds from the Department of Energy, DOE, Materials Protection and Control program, to meet emerging threats in other areas of the world.

I had previously expressed my gratitude to Senator Collins for her extraordinary leadership in this effort. Her assessment on the floor is one I join.

The House bill contained a provision, based on an administration proposal, that would fundamentally alter the Federal Civil Service System by authorizing the Secretary of Defense to waive certain provisions of law governing employee performance, pay and allowances, labor relations, hiring and firing, training, pay administration,

oversight and appeals. The House provision included few legislated procedures and processes for the new civilian personnel system, other than the requirement that the new system be ``flexible'' and ``contemporary''.

The Federal Civil Service System was established more than a century ago to replace a patronage system that was characterized by favoritism, and abuse. While reform and streamlining of that system is a reasonable objective, it is equally important that we do not allow those abuses to resurface. The House bill would not only have provided the greatest shift of power to the executive branch in memory, it would also have put us at risk to some of the abuses of the past.

Senator Collins and I worked together closely to fashion a bipartisan bill in the Governmental Affairs Committee that would provide the Department of Defense the new personnel flexibility that it needs, while preserving important protections for individual employees. Our bill was approved by the Governmental Affairs Committee in early June and became the basis for our negotiations in conference with the House.

The bipartisan approach that Senator Collins and I took on this issue met with opposition from the administration at every turn. At times, it appeared that some of our opponents were less interested in enacting sound human capital provisions than they were in providing as much power as possible to the Secretary of Defense.

Nonetheless, we were able to build some important protections into the legislation that is included in this conference report. These include provisions from the Collins-Levin bill that would: preserve the right of individual employees to appeal adverse personnel actions to the Merit Systems Protection Board and, if necessary, the courts; ensure that the new personnel system cannot be used as a basis for reducing the amount of money allocated to civilian pay accounts; provides specific guidance and direction on the implementation of a pay-for-performance system; ensure that the Office of Personnel Management will play a central role in developing a new personnel system for the Department of Defense; and provide for the orderly phase-in of the new personnel system.

The outcome on collective bargaining issues was more of a mixed bag. I believe that the right of employees to participate in labor organizations of their choosing, and to engage in collective bargaining through such organizations, is a fundamental one in our society. This view does not appear to be shared by the White House or the Department of Defense.

Nonetheless, the collective bargaining provisions that Senator Collins and I were able to negotiate on this bill are substantially better from our perspective than comparable provisions included in the House bill and the Homeland Security Act.

The Homeland Security Act authorize the Secretary of Homeland Security to waive any and all of the provisions of Chapter 71 of Title 5, which governs labor-management relations for Federal employees. This waiver authority gives the Secretary of Homeland Security complete authority to establish any new labor relations system he may choose, with virtually no statutory limitation. The House bill would have provided the same authority to the Secretary of Defense.

This conference report does not include any authority to waive the requirements of Chapter 71. On the contrary, as the Chairman of the House Government Reform Committee pointed out on the House floor last week, this bill specifically lists the provisions of Chapter 71 as being non-waivable. The bill before us states, and I quote, ``Any system established [under this provision] shall . . . not waive, modify, or otherwise affect'' Chapter 71. This means that the Department of Defense, unlike the Department of Homeland Security, remains subject to the collective bargaining requirements of Chapter 71.

The conference report also states that, notwithstanding the provision preserving the full force and effect of Chapter 71, the Secretary ``may establish and from time to time adjust a labor relations system for the Department of Defense to address the unique role that the Department's civilian workforce plays in supporting the Department's national security mission.''

These two provisions must be read together and both must be given meaning. The first provision states that Chapter 71 may not be waived or modified. The second provision states that the Secretary may establish a unique labor relations system. For both provisions to have meaning, the unique labor relations system established by the Secretary must be consistent with the requirements of Chapter 71. For example: Section 7102 of Chapter 71 states that each employee shall have the right to form, join, or assist any labor organization to engage in collective bargaining with respect to the conditions of employment through representatives chosen by employees. The unique labor relations system established by the Secretary must preserve this right.

Section 7105 states that the Federal Labor Relations Authority FLRA shall determine the appropriateness of units for labor organizations representation and supervise or conduct elections within such units. Nothing in the conference report gives the Secretary of Defense any authority to waive or modify this requirement imposed on an independent Federal agency.

Section 7111 requires an agency to accord exclusive recognition to a labor organization if the organization has been selected as the representative by a majority of the employees in a bargaining unit. The unique labor relations system established by the Secretary must preserve this right.

Section 7114 states that a labor organization which has been accorded exclusive recognition as the exclusive representative of the employees in the unit represents and requires an agency to bargain in good faith with such a labor organization. The unique labor relations system established by the Secretary must preserve this right.

Section 7116 provides that it shall be an unfair labor practice for an agency to interfere with, restrain or coerce employees or to refuse to consult or negotiate in good faith with a labor organization. Nothing in the conference report gives the Secretary of Defense any authority to waive or modify this requirement.

Section 7118 authorizes the General Counsel of the FLRA to investigate allegations that any person has engaged in unfair labor practice. Nothing in the conference report gives the Secretary of Defense any authority to waive or modify this requirement applicable to an independent federal agency.

Unfortunately, the conference report does provide for exceptions to the applicability of Chapter 71. In this regard, the conference report specifically provides that the labor relations system established by the Secretary ``shall provide for independent third party review of decisions, including defining what decisions are reviewable by the third party, what third party would conduct the review, and the standard or standards for that review.'' It also states that national level collective bargaining shall ``be subject to review by an independent third party only to the extent provided'' under this process. This language appears to preclude the appeal of such issues to the Federal Service Impasses Panel under section 7119 of Title 5.

While I was disappointed by the decision to include language limiting the review of collective bargaining decisions, the preservation of other rights under Chapter 71 makes this provision far preferable to the personnel provisions in the House bill or the Homeland Security Act. Senator Collins' commitment to this issue has ensured that Department of Defense employees will have far greater protection under the National Security Personnel System than they would otherwise have enjoyed. I commend her for her steadfast determination to make this provision as balanced and as fair as possible.

Several of the environmental provisions in the bill go far beyond what is needed to address the legitimate needs of the Department of Defense.

The first of these would exempt defense lands from critical habitat designations without establishing a suitable alternative environmental safeguard. Both the House bill and the Senate bill recognized DOD's interest in greater flexibility for military training by allowing the use of an ``Integrated Natural Resources Management Plan,'' INRMP, adopted by DOD to protect endangered species in lieu of a critical habitat designation, which would be far

more restrictive. However, the Senate bill included a threshold test-- used by the past two administrations--before an INRMP could be approved as a substitute for a critical habitat designation. The House bill contained a much less careful approach.

In the course of the conference, we offered a long series of possible compromises on the threshold test. We suggested that DOD at least show that the INRMP provided a ``reasonable benefit'' for endangered species, or ``appropriate protection'' for endangered species--flexible tests that would have given the administration broad discretion to balance military readiness concerns against environmental protection concerns.

We were met with a complete stone wall. We were told that while the Pentagon would of course be ``reasonable'' and take ``appropriate'' steps, these words could not be put into statute. Any adjective, we were told, would subject the Department of Defense to ``litigation risk.'' Of course, the only standard that raises no litigation risk is a standard that imposes no obligation. That appears to be the course that is administration has chosen when it comes to environmental issues.

Similarly, on the Marine Mammal Protection Act, I believe that the Navy has some legitimate concerns about the application of the current statute, but I was concerned that the language in the House bill went too far in trying to address those concerns. As I read that language, the Navy would not even be required to seek a permit under the Marine Mammal Protection Act unless its activities would disturb marine mammals populations to such a significant extent that there are reproductive or survival implications for the species. If for some reason this weren't enough, and a permit wasn't granted, the provision would allow the complete exemption of activities that would have an even greater adverse impact on marine mammals.

I offered to work with the Navy to try to reach agreement on more balanced language that would still address the Navy's concerns. The Navy initially encouraged such discussions, but the Department of Defense soon began to reject any change to the House language. As was the case with the Endangered Species Act, the Administration rejected every proposal that could have garnered broad bipartisan support in favor of an approach that would impose virtually no obligation at all on the Department of Defense to be environmentally responsible. I am concerned that this approach could result in real and unnecessary harm to marine mammals and a serious backlash against the Navy--which could undermine critical readiness activities in the long run.

Finally, I am disappointed by the outcome of the conference on nuclear weapons issues. In my view, this conference report takes the United States in a dangerous new direction that marks a major shift in American policy, is inconsistent with our longstanding commitment under the Nuclear Nonproliferation Treaty, and undermines our argument to other countries around the world that they should not develop or test nuclear weapons. With this legislation and related actions over the past 2 years, the Bush Administration appears to be moving to change the traditional thinking about nuclear weapons, to make nuclear weapons more usable, and to see them as just another capability. Or, as a recent article in the New York Times Magazine suggests, to make the unthinkable--thinkable.

Current U.S. law bans research and development of new nuclear weapons that could lead to their production. The specific weapons covered by the ban are so called low-yield nuclear weapons which have a nuclear explosive yield of 5 kilotons or less. Five kilotons is roughly a third the size of the nuclear bomb that was used at Hiroshima, which immediately killed an estimated 140,000 people and left many more injured. The Bush administration asked that this ban be repealed. This conference agreement would do so.

There is some satisfaction that the conference agreement includes language adopted on the Senate floor, which would require specific congressional authorization before the administration may engineer, test, produce or deploy a low-yield nuclear weapon. However, this requirement is a poor substitute for current law, which imposes a complete ban on the development of such weapons.

This conference report would also authorize the Bush administration request to continue work on a Robust Nuclear Earth Penetrator, RNEP. As with low-yield nuclear weapons, the Administration would be authorized to proceed with research, but would be required to obtain specific authorization to engineer, test, produce or deploy the RNEP. The RNEP program would modify one of two existing low yield nuclear weapons to create a nuclear weapon that will penetrate rock. Both weapons being looked at for possible modification are high yield nuclear weapons with yields that are approximately 30 and 70 times the explosive power of the Hiroshima bomb.

At a time when the United States is trying to dissuade other countries from going forward with nuclear weapons development, when we strongly oppose North Korea's pulling out of the Nuclear Nonproliferation Treaty, and when we are spending over a billion dollars to prevent the spread of nuclear weapons material and technology, these actions would send a terrible message. We are telling others not to go down the road to nuclear weapons. But instead of being a leader in the effort to prevent the proliferation of nuclear weapons, we are recklessly driving down that same road. In short, the United States is following a policy that we do not--and should not--tolerate in others.

This is an area where many of us have been deeply troubled by the direction of this administration because it would seem at the same time we are trying to dissuade other countries from going forward with nuclear weapons development, when we strongly oppose North Korea's pulling out of the nuclear nonproliferation treaty and when we are spending over $1 billion to prevent the spread of nuclear weapons material and technology, the actions we are taking here send the wrong message, which is continuing to go down a road of considering new and doing research on new nuclear weapons and modernization of nuclear weapons.

We put something of a lid on it by specific language which the chairman introduced on the floor, which I very much supported and which requires that before we move to a development stage in any new weapon, that there be a specific authorization by the Congress that does give at least some protection, some certainty that we will not move to the development stage of a new modernized nuclear weapon without thorough consideration of the Congress. That, at least, is some constraint on that development.

Finally, again, I thank our chairman for bringing this bill to the floor. It has taken tenacity and patience and all the other wonderful qualities he has to make it possible. He has a wonderful way of being inclusive and open in a way that is appreciated by everybody. It has been noted on the floor many times in the last few hours.

I also thank our ranking minority members, as well as the other members of our committee who chair the subcommittees, for all the support they have given to this bill throughout the year. It took a long, long time for this bill to come to the floor and, finally, for us to come up with a conference report. We have a truly talented group of members on our committee.

Of course, as the ranking member, I focus on the other ranking members of the subcommittees, but I know I speak for Senator Warner in thanking all of the members of our committee. He has already thanked all the members of the committee for their work this year.

I thank our staff for their hard work, including Judy Ansley, Rick DeBobes, Chuck Alsup, Ken Barbee, Mike Berger, June Borawski, Leah Brewer, Jennifer Cave, David Cherington, Chris Cowart, Dan Cox, Madelyn Creedon, Mitch Crosswait, Marie Fab Dickinson, Brie Eisen, Evelyn Farkas, Richard Fieldhouse, Andy Florell, Brian Green, Creighton Greene, Bill Greenwalt, Carolyn Hanna, Jeremy Hekhuis, Bridget Higgins, Bruce Hock, Gary Howard, Andrew Kent, Jennifer Key, Greg Kiley, Maren Leed, Gary Leeling, Peter Levine, Patty Lewis, Tom MacKenzie, Sara Mareno, Ann Mittermeyer, Lucian Niemeyer, Cindy Pearson, Paula Philbin, Lynn Rusten, Arun Seraphin, Joe Sixeas, Christy Still, Scott Stucky, Mary Louise Wagner, Dick Walsh, Nicholas West, and Kelley Wilson.

We could not have come to this position without our staff. If I can single out Rick DeBobes' work in particular, I know Judy will forgive me. This is his first year as staff director on our side, and Rick's work has been nothing less than extraordinary. It is exactly what we have come to expect from him.

I must also note Peter Levine, because of his continuous work. I probably should not single out anybody other than Rick, but I think all the members of the staff on this side will also understand why I single out Peter, in addition to Rick DeBobes, for the kind of work they have given this committee this year.

His influence continues. He is now my chief of staff on my personal staff. He takes, of course, a major interest in this area, as he always has. I am sure Rick and Peter and all the others would say having David on my personal staff is a big plus.

Mr. President, I wonder if the Senator will yield for a question without losing his right to the floor.

Mr. President, I tried to catch as much as I possibly could about the Senator's exposition of Searchlight on the monitor in our offices. It is an absolutely fascinating history which he has shared with the Senate.

I point out that the Senator who is doing this tonight is surely one of the most patient, determined, and beloved Members of the Senate. I ask this question of him as somebody who I think in the Senate on both sides of the aisle is admired, as somebody who tries to keep this institution working, and who has accommodated every Member of this Senate over the years, be it Republicans or Democrats.

My question relates to Searchlight. I want to just see if the place I actually went through with my wife on our way to Death Valley, CA, might have been Searchlight. We went through it at night. It was a town in Nevada--a very long town. It was in a valley. It was probably 10 times longer than it was wide. It was one of those nights where all the lights of the town sparkled. I am sure Nevada probably has some of the clearest air in the world. I wonder whether or not that is the shape of Searchlight. Is it a very long, rectangular town?

Will the Senator yield for a question without losing your right to the floor.

Are there not two other factors involved here: One, that in all four cases there has been significant debate on each of those four judges before the votes that were cast, the cloture votes which were cast? As a matter of fact, there is a suggestion there may be additional cloture votes for which debates would be totally appropriate. If the majority is going to bring up additional cloture votes on any of those judges, there would be debate before cloture on those judges. But what the 30-hour proposal is, is something which does not lead to votes.

Is the Senator from Michigan correct, there are no votes at the end of the 30-hour use of the Senate's time?

(Mr. BENNETT assumed the Chair.)

Will the Senator yield?

Will the Senator yield for an additional question?

Without losing your right to the floor.

I wonder if your staff could put that other chart on with the judges because I just want to expand on one or two points. Some of the judges which the good Senator from Nevada pointed out were judges where cloture votes were required by the opponents of the judges; is that not correct, during the Clinton years, and it was required there be 60 votes in order to get those cloture motions adopted?

Now, does that not mean, for people who might be watching this, that it was required that the supporters of that judge produce 60 votes?

I wonder if the Senator will yield for an additional question without losing his right to the floor.

The Senator from Nevada, probably more than anybody, has made it possible for this Senate to run as smoothly as it does, even though there are huge numbers of bumps in the road. There would be 100 times as many bumps in the road but for the willingness of the Senator from Nevada to work with Members on both sides of the aisle to get legislation passed. He is constantly here in the well of the Senate asking people if they could cut the time down on their amendments, could they drop amendments, could they work cooperatively with somebody to work jointly on a bill. It is a constant effort to keep the wheels greased so we can accomplish as much as we do.

I ask the Senator from Nevada this question: As somebody who is known to every Member of this Senate as someone who makes it possible for us to get a whole lot of things done, which we could not get done but for that effort, is part of the cooperation which makes it possible for us to act cooperatively, to act with a sense of comity, which we do most of the time, is it not true that part of that is that there be a willingness to share scheduling information with the minority so the minority can schedule airplanes, come back when there are going to be votes, and that that is an essential part of a spirit of cooperation which is so essential to be President of the Senate, and whether that is something which the Senator is referring to when he talks about an unwillingness to give information about whether there would be votes and on what subjects today and tomorrow?

If the Senator will yield for one additional question.

Is the likelihood that we will be able to finish all the appropriations bills reduced when we spend 30 hours on some other subject which, again, does not lead to a vote on those judges, but nonetheless is it less likely that we will be able to finish all the appropriations bills as a result of allocating that time to that debate and, as a result, if we do not finish the appropriations bills individually, does this

mean it is more likely that we are going to end up with some kind of an omnibus appropriations bill which bollixes together three or four appropriations bills which should be and usually are treated separately, amended separately, debated separately in the light of day?

Mr. President, will the Senator yield for a question?

Mr. President, one of the areas which the Senator from Nevada has led us to is the question of concurrent receipts. We are going to make some progress on that this year. I say that 90 percent of the credit for the progress we are going to make in that area belongs to the Senator from Nevada. He was modest in mentioning it here in terms of what is before the Senate. The success we have had in overcoming a veto threat from the administration--that if we finally allow people who are disabled to receive both the disability benefit as well as a retirement benefit and not take away one benefit when they receive the other--we were finally able to accomplish that because of the leadership of the senior Senator from Nevada.

I want to ask him whether it is not accurate that one of the bills which awaits our consideration would be the conference report that accompanies the Defense authorization bill which contains the provision I just mentioned which would finally allow for at least the people who have 50-percent disability or more the concurrent receipt of both their disability benefit and their retirement benefit, and end the unfairness that you cannot get a retirement benefit.

Mr. President, 2 weeks ago, the majority leader indicated that before this session of Congress comes to an end, the Senate may consider the Protection of Lawful Commerce in Arms Act, a bill the New York Times has said ``would give gun manufacturers and dealers a courthouse shield that tobacco and asbestos companies never had in being forced to come to terms with some of the damage their products inflict.'' While it now appears unlikely that the bill will be considered in the Senate this year, I would nevertheless like to express my concerns about it.

The bill would rewrite well-accepted principles of liability law, providing the gun industry legal protections enjoyed by no other industry. Some claim that this bill would prevent frivolous lawsuits and protect firearm manufacturers, dealers, and distributors from being held responsible for the actions of criminals. While most gun dealers and manufacturers may conduct their business responsibly, this bill would shield negligent and reckless gun dealers and manufacturers from legitimate civil lawsuits.

In fact, according to the Brady Campaign to Prevent Gun Violence and the Violence Policy Center, many meritorious cases could be dismissed under the bill. And according to a letter from University of Michigan Law Professor Sherman Clark, the case filed by the Washington, D.C. area sniper victims is among those that would not survive if the legislation were enacted. I ask unanimous consent that a copy of Professor Clark's letter be printed in the Record.

The two alleged snipers were both legally prohibited from buying guns, but through the apparent negligence of a gun dealer, they were able to obtain the military-style Bushmaster assault rifle. Reportedly, the gun dealer operated in such a grossly negligent manner that 238 guns inexplicably disappeared from its store. Among the missing guns were the alleged snipers' Bushmaster rifle. Several of the snipers' victims have filed a lawsuit against the dealer and others. Their case might not survive if this bill became law.

This bill would set a dangerous precedent by giving a single industry broad immunity from civil liability and depriving many victims with legitimate cases of their day in court. If it is enacted, other industries will almost certainly line up for similar protections.

Every single gun safety organization has expressed its opposition to this bill. This is special interest legislation. It should not be adopted.

Mr. President, I did not hear the beginning of that statement, but we are awaiting the document so we can read it. We would be happy to give an answer as promptly as we can, after the document is completed, but I understand there is some unfinished business and uncertainty that needs to be looked at.

I think we all hope it gets finished, but it is not finished yet.

Mr. President, I am pleased that S. 1427 acknowledges the problem posed by the emerald ash borer. To date, tens of thousands of Ash trees in my home State of Michigan have died due ``to infestations of the emerald ash borer,'' and I am glad that this bill provides $1 million for efforts to remove Ash trees that have been claimed by this invasive species.

I appreciate the efforts made by the Agricultural Appropriations Subcommittee to acknowledge and address

the devastation caused by the emerald ash borer in Michigan, Ohio and Ontario, Canada, and which is threatening to spread.

The provision of funds contained in this legislation will assist local communities in removing trees that have been killed by this invasive species. It is also my understanding that USDA's Animal Plant Health Inspection Service--APHIS--provided $14.8 million in fiscal year 2003 funds to assist with efforts to contain and eradicate the emerald ash borer.

Michigan's Governor, Jennifer Granholm, has requested that USDA provide $33 million in fiscal year 2004 funds for further efforts to combat this pest. These funds are vitally needed; however, efforts to combat the emerald ash borer should not be dependent upon the provision of emergency funds each new fiscal year. USDA must develop a multi-year plan for eradicating the ash borer.

Mr. President, I join the junior Senator from Michigan in her concern for this potentially devastating problem. The Canadian yard waste, which includes tree branches and trimmings, poses a serious threat of spreading the Asian long-horned beetle to Michigan. According to the USDA, these beetles lay their eggs in grooves that they chew into the tree's branches and trunk. The beetle requires 1 to 2 years to completely develop from an egg to an adult and feeds on the host tree during that time. Branches and tree scraps brought into Michigan as yard waste could contain beetle eggs and larvae that are embedded in the bark. The Asian long-horned beetle is extremely destructive to hardwood trees, particularly maple, poplar and willow trees. Michigan's tree population has already been severely damaged by the spread of the emerald ash borer beetle, which has killed over 6 million trees in Southeast Michigan and caused over $162 million in damage. The USDA must act immediately to prevent another devastating infestation, the Asian long-horned beetle, from spreading into Michigan.

I thank the distinguished ranking member of the subcommittee.

Mr. President, I join the Senator from Michigan in asking the distinguished ranking member to give this important project consideration in conference. Phytophthora root rot is a fungus that is destroying crops and once the soil is infested, it must be taken out of production for 10 years. Currently, methyl bromide, which has been used by fresh market growers to control the disease, is scheduled to be phased out in 2005. New research is needed to develop tools that can effectively contain and eradicate this devastating disease.

I thank the distinguished ranking member of the subcommittee.

Mr. President, I wish to ask my colleagues from Utah and Wisconsin if they are aware of the great need to control erosion and sediment in the Great Lakes region.

Mr. President, I ask unanimous consent that morning business be extended for 20 minutes, equally divided between this side and the Republican side.

Mr. President, I ask that the Chair inform me when 5 minutes have been utilized so I can share the remainder of our time with the Senator from New Jersey. I think the Senator from Indiana may be on his way over as well.

Mr. President, early this morning there was a discussion on the

floor of a staff memo from some Intelligence Committee staffers which had not either been authorized or indeed shared by members of the Intelligence Committee. But it was characterized--and I think mischaracterized, quite clearly--as a Democratic plan relative to the review of the intelligence that was created and used prior to the Iraqi war.

The only thing that Democratic members of the Intelligence Committee have pressed is for a full investigation, a full inquiry into not just the creation of the intelligence but the use of that intelligence.

Without looking at the use of intelligence that was created by the intelligence community, there would only be half a picture painted. Hopefully, that half of a picture will be fully explored on a bipartisan basis. I think the first half of the picture, indeed, is being fully explored on a bipartisan basis. That is the part of the picture that looks at the intelligence community's production of intelligence and as to whether or not that intelligence community in some way either shaped or exaggerated that intelligence for whatever purpose. It has also been now added that if any of the administration put pressure on the intelligence community that would also be included in the review.

But what is left out is the critical half of the picture which the American public hears, which is the use of the intelligence given to the policymakers by those policymakers. Now, the word ``use'' of intelligence, that word ``use'' actually appears in the resolution creating the Intelligence Committee and identifying the oversight role of the Intelligence Committee. So the word ``use'' is actually embedded in the very document creating the Intelligence Committee that sets forth what its role will be and what its oversight responsibilities are. Yet so far the majority of the Intelligence Committee has said: We will not look at the use of the intelligence which was given to the policymakers.

Now, that is a huge gap. That means we will be walking up to the water's edge and stopping there. That means instead of letting the chips fall where they may, the chips will only be allowed to fall on the intelligence community's side of the fence. They will not be allowed to fall on the policymakers' role and responsibility.

We were told by the policymakers, prior to the war, that--this is Secretary Rumsfeld--

We know where the weapons of mass destruction are.

We were told, before the war, by the Vice President:

Simply stated, there is no doubt that Saddam Hussein now

has weapons of mass destruction.

We were told, before the war, by the President, himself, that:

Intelligence gathered by this and other governments leaves

no doubt that the Iraq regime continues to possess and

conceal some of the most lethal weapons ever devised.

So the heart of the problem that we have at the Intelligence Committee is whether or not we are going to stop at that water's edge or look at the use of the intelligence, whether a critique will be made of the intelligence community's shaping or exaggeration, to the extent that existed, or whether or not the same searchlight will be placed upon the policymakers as to whether they exaggerated or shaped or misstated what was given to them by the intelligence community.

The Department of State had a Web site. On December 19 of last year, that Web site said:

Why is the Iraqi regime hiding their uranium procurement?

This is months after the CIA apparently told the State Department that there was no such effort on the part of Iraq to obtain uranium, or at least that they had not reached that conclusion. Yet in December-- and by the way, much later--the State Department's Web site still is representing to the public that the Iraqi regime is hiding uranium procurement.

Why should we not look into that Web site? How does that Web site get created, despite what we now believe was the intelligence community's conclusion or lack of conclusion relative to uranium acquisition?

I thank the Chair.

Mr. President, first let me thank Senator Feinstein for her leadership on this issue and for her typical courtesy in interrupting her statement so I may give mine at this time. It is most appreciated. More important, I thank her for her leadership and Senator Lugar's leadership in bringing this amendment to the floor.

Recent highly negative events in our energy markets show that there is an urgent need to prevent price manipulation in those markets, improve the transparency of energy markets, and to strengthen the ability of State and Federal agencies to enforce the rules governing the operation of those markets.

Widespread price manipulation and falsification of price information in the electricity and natural gas markets in the last few years have inflicted billions of dollars in extra costs on energy consumers and businesses and have been a severe blow to our economy.

The corruption and manipulation of these markets by Enron and other companies fueled the collapse of some energy markets in the United States, the bankruptcy of some energy companies, and a huge decline in investment and trading in the energy markets.

The bipartisan amendment of Senators Feinstein, Lugar, myself, and others would close these ``Enron loopholes.'' Enron used these loopholes, and other companies joined with them, to manipulate energy markets at the public's expense. Our amendment would strengthen prohibitions on fraud and manipulation and give both the Federal Energy Regulatory Commission, FERC, and the Commodity Futures Trading Commission, CFTC, the necessary tools to monitor the energy markets, to prevent manipulation, and ensure that prices are fairly and competitively arrived at.

This legislation is needed because companies such as Enron are now permitted to trade large amounts of energy in virtually unregulated markets, making those unregulated markets and

the resulting price of the energy we use vulnerable to fraud and manipulation.

FERC's recent report on manipulation in the western energy market provides some stunning examples of how the energy markets can be manipulated.

FERC found that Enron, through an unregulated electronics trading center called EnronOnline, ``manipulated the price of physical gas upward and downward,'' earning huge amounts of illegal profits. FERC determined that Enron often ``invited counterparties to wash trades, and these trades created a false sense of liquidity, which can distort prices. Enron also manipulated prices on the EOL by having affiliates on both sides of certain wash-like trades. This created artificial price volatility and raised prices.''

The report by FERC concluded that ``large-volume, rapid-fire trading by [Enron] . . . substantially increased natural gas prices in California.'' FERC found ``significant market manipulation'' in the ``inextricably linked'' natural gas and electricity markets, and that ``dysfunctions in each fed off one another'' during the energy crisis in California.

According to FERC:

Spot gas prices rose to extraordinary levels, facilitating

the unprecedented price increase in the electricity market.

Dysfunctions in the natural gas market appeared to stem, at

least in part, from efforts to manipulate price indices

compiled by trade publications. Reporting of false data and

wash trading are examples of efforts to manipulate published

price indices.

Finally, the report found:

The widespread false reporting led staff to conclude that

reported prices did not reliably reflect market activity.

I would like to give one specific example on how one day, January 31, 2002, Enron used an unregulated, nontransparent Internet trading system to manipulate the natural gas market in California.

In August of 2002, the FERC staff issued an investigatory report finding that out of a total of 227 trades on that day, January 31, 2002, 174, or more than two-thirds of the trades on that day, involved Enron and a single unnamed party. Most of these trades took place during the last hour of trading with two parties buying huge amounts of natural gas from each other in numerous transactions.

FERC determined that the trades took place at ``higher prices,'' in their words, than other trades that day, and resulted in a steep price increase over the last hour of trading. FERC described this trading activity as ``difficult to rationalize as a normal or standard business practice'' and noted:

[O]nly Enron and possibly the counter party could have

known that so much of the trading was going on between

themselves, because parties looking at EOL's screens could

only see the bid and ask prices; they could not know who the

counter party was on any particular trade.

The FERC report indicated that EnronOnline's prices were routinely used to prepare published reports on natural gas prices, which meant that the Enron price data was not just affecting Enron trades but also causing higher natural gas prices industry-wide. The report concluded that Enron had ``significant ability and incentive to manipulate the price data published by the reporting firms.''

This spring, FERC issued a number of recommendations to fix the problems in the energy markets. FERC recommended new policies and procedures for the oversight of commodity trades and prices and a system of market surveillance to detect and prevent manipulation.

In March of this year, following a year-long investigation, I released a Permanent Subcommittee on Investigations staff report into the operation of crude oil markets. The report describes the regulated and unregulated markets for buying and selling crude oil and explains how crude oil prices are set and how they affect the price of critical oil commodities, such as gasoline, home heating fuel, jet fuel, and diesel fuel.

The report describes the vulnerability of unregulated commodity markets to price manipulation and the need for and beneficial effects of U.S. commodity regulation. The report also explains how the over- the-counter markets are virtually unregulated and, therefore, vulnerable to manipulation.

The report recommends that traders in over-the-counter markets be required to ``provide the CFTC with routine information on large positions in crude oil and energy contracts and derivatives, as well as other information that would aid the CFTC in detecting, preventing, and halting commodity market manipulation.''

So we have two reports reaching the same conclusions about the need for more market transparency and strengthened oversight to detect and prevent fraud and manipulation in energy markets.

How did we get to this position where companies, such as Enron, are permitted to manipulate prices in our energy markets? The answer lies in how the energy markets and the Federal regulations have evolved over the last 20 years.

Billions of dollars' worth of contracts for the future delivery of energy are now traded every day. These contracts are called energy derivatives because they derive their price from the price of the energy commodity in the contract.

There are two basic types of energy derivatives. Energy derivatives that are traded on futures exchanges are called futures contracts. The trading of futures contracts on futures exchanges is regulated by the Commodity Futures Trading Commission under the Commodity Exchange Act.

The other type of energy derivatives, which are not traded on futures exchanges, are called over-the-counter energy derivatives. These derivatives may be traded by fax, by phone, in face-to-face meetings, or over the Internet. The trading of these derivatives is virtually unregulated.

Both the futures markets and the over-the-counter markets perform identical economic functions. Both markets enable traders to buy and sell commodities at fixed prices, disseminate information about commodity prices, and provide a way for buyers and sellers to hedge against changes in the price of these commodities. Commodity traders routinely use both the futures markets and the over-the-counter markets for price discovery and hedging.

Today, the types of contracts traded in the futures markets and the over-the-counter markets are virtually identical. As an indication of how indistinguishable these contracts really are, the NYMEX even calls some of the contracts that it offers on its over-the-counter electronic market ``futures contracts.''

This is an example of what is shown on the NYMEX boards. This is the way the NYMEX advertises: Light Louisiana sweet crude oil futures-- futures. Futures are supposed to be bought and sold on futures markets, not over-the-counter markets, but this is an over-the-counter sale and offer.

This is a picture the New York Mercantile projects over the Internet for the purchase and sale of over-the-counter contracts. Notice it says: Trading venue is over the counter, and yet it calls that over- the-counter offer ``futures.'' If they were really futures, they would be regulated as futures contracts are by the Commodity Futures Trading Commission. But these are over-the-counter sales. These are unregulated, and yet they are characterized as futures. The language used here is interchangeable. The economic function is interchangeable. The only difference--and it is a critical difference--is that futures contracts are regulated by the Commission and over-the-counter contracts are not. And they should be. They perform the same economic function. The language used is exactly the same and yet there is one group of contracts unregulated. The other group of contracts is regulated. It is the unregulated contracts which got us into so much trouble, the lack of transparency which got us into so much trouble.

Let me give another example. The largest over-the-counter electronic trading facility is the Intercon- tinentalExchange, known as ICE, in Atlanta. It trades contracts that it calls futures, and yet these are not futures; these are over-the- counter transactions, described by the ICE as futures. It says you can trade futures from your desktop. Yet these are over-the-counter transactions.

Here is what they say on their Web site:

IntercontinentalExchange brings parallel trading in IPE

Brent crude of futures to the ICE platform. Electronic

futures trading sessions operate in parallel with the regular

open-outcry session on the IPE floor in London.

Now, that open-outcry session, as they phrase it, is the futures trading session that occurs at the exchanges. So they are treating them the same. They are saying, one can trade in futures electronically. The language now has become the same, the economic function is the same, but there is one key difference, and it is a deadly difference in terms of consumers and in terms of manipulation of prices. That difference is that futures contracts are in fact regulated and must be disclosed and are in fact transparent, whereas the over-the-counter trades are not. They are now dealt with interchangeably by the largest exchange, the largest over-the-counter electronic trading facility in the country, the IntercontinentalExchange in Atlanta.

Only real futures markets are regulated to prevent price manipulation. That is a fact. The over-the-counter market is not. That is what has got us in the hole we are in. That is what permitted Enron to dig us deeper into the hole we are in and to cause the loss of huge amounts of money to our consumers and to many customers. No disclosure, take care of these trades over the market. If the market were a regulated market, such as the futures market is, it would have been regulated. It could have been transparent. We would not have seen the Enron disaster and the manipulation that we saw in Enron and by other companies.

The Commodity Exchange Act regulates the futures exchanges so that they cannot be artificially manipulated. This regulation and transparency has bolstered the confidence of traders in the integrity of these markets and it has helped to propel our country into the leading marketplace for many commodities.

For example, the New York Mercantile Exchange, NYMEX, is the world's leading exchange for futures contracts, for energy products such as natural gas, crude oil, gasoline, and home heating oil. The CEA makes it a felony to manipulate the price of any commodity, and it contains a number of provisions to enable the futures exchanges and the CFTC to detect and prevent price manipulation. The CEA requires the regulated futures exchanges to ensure that trading is orderly and to detect and prevent price manipulation. The CEA directs the CFTC to oversee the operations of the futures exchanges and to itself perform market oversight and ensure that trading is orderly.

According to a former CFTC Chairman:

The job of preventing price distortion is performed today

by regulatory and self-regulatory rules operating before

the fact and by threats of private lawsuits and

disciplinary proceedings after the fact. Both elements are

essential.

According to the CFTC:

The heart of the commission's direct market surveillance is

a large-trader reporting system, under which [the futures

exchanges and brokers] electronically file daily reports with

the commission. These reports contain the futures and option

positions of traders that hold positions above specific

reporting levels set by the CFTC regulations.

There are no protections against manipulation in the over-the-counter markets. Unlike the futures markets, the over-the-counter markets are not required to monitor trading to detect and deter fraud and price manipulation. Information that is routinely reported to the futures exchanges and the CFTC is not available to the over-the-counter exchanges or to the CFTC. Traders do not have to report large trades. There are no position limits or daily price limits. The over-the- counter markets lack all of the critical features of an effective program to detect and prevent price manipulation.

Over-the-counter energy derivatives are unregulated because of a provision that was added to a conference report at the last minute in an amendment to the Commodity Exchange Act in an omnibus appropriations bill at the end of the Congress in the year 2000. The Commodity Futures Modernization Act of 2000 was intended to clarify the regulation of financial instruments. Most of the provisions in the CFMA were based upon the recommendations contained in the Report of the President's Working Group on Financial Markets, Over-the-Counter Derivatives Markets and the Commodity Exchange Act, which was jointly issued in November 1999 by the Treasury Department, the Federal Reserve, the SEC, and the CFTC.

The working group recommended that financial derivatives be excluded from regulation under the CEA but that derivatives involving nonfinancial commodities with a limited supply, such as energy commodities, not be excluded.

The working group stated:

Due to the characteristics of markets for nonfinancial

commodities with finite supplies, however, the working group

is unanimously recommending that the exclusion not be

extended to agreements involving such commodities.

A unanimous recommendation of the working group and the House and Senate bills leading up to that conference in fact did not extend the exclusion to commodities transactions. Yet the exemption in the current law for trades in over-the-counter energy derivatives, the Enron exemption, somehow or another got inserted in that law at the eleventh hour during a House-Senate conference. This exemption was never considered by any committee. It was never discussed at any hearing. It was never commented on by interested parties. It was simply inserted in the conference report at the last minute. It is one of the reasons for the Enron mess that we have had to clean up after.

This amendment would correct that situation. It is essential we have this kind of transparency regulation in the commodities markets. I hope this amendment, which is a bipartisan amendment, will be adopted by this body and close the Enron loophole which was created in the dark of night, without any debate in this body, without any knowledge of this body, in a bill which this body had passed without such an exemption, in a bill which the House had passed without such an exemption, and yet the exemption showed up nonetheless in a conference report and helped to create the Enron disaster and mess which we have been trying to clean up ever since.

Exempting energy commodity trades from the CEA did not make sense when it happened in 2000. It would be irresponsible to continue it now, especially after we have seen how it facilitated the market fraud and manipulation by Enron and others.

The amendment before us would return the commodities law to the way it was for decades prior to the passage of the Enron exemption. It would ensure that fraud and price manipulation would be a felony, and it would remove ``the Enron exemption'' as a shield against regulation and prosecution. It would authorize the CFTC to establish recordkeeping requirements to enforce the anti-fraud and anti-manipulation prohibitions in the CEA.

This amendment also contains important provisions to improve FERC's ability to ensure the transparency and integrity of wholesale energy prices. It would direct FERC to establish an electronic price reporting system, strengthen the penalties for violations of the Federal Power Act and the Natural Gas Act, prohibit wash trading and other collusive and manipulative practices in wholesale energy markets, and clarify FERC's authority to fashion appropriate remedies in cases of wholesale price manipulation.

There is a great deal of support for this legislation.

Governor Jennifer Granholm, of my home State of Michigan, writes that, in the aftermath of the massive electricity blackouts that struck Michigan and large areas of the midwest and northwest this past summer, ``all necessary steps should be taken to bolster business and consumer confidence in the Nation's energy markets and promote additional investment in reliable energy delivery at a fair price.'' Governor Granholm says our language ``would improve energy price transparency in wholesale electricity markets, greatly increase criminal and civil penalties for trading violations, prohibit market manipulation and fraud in all energy market sectors, and strengthen day-to-day energy market oversight, including over-the-counter market transactions that significantly affect energy prices.''

The American Public Gas Association supports the amendment because ``it will improve market transparency and provide the essential regulatory oversight to detect and prevent manipulation and improve the efficiency of energy markets.''

Attorney General Eliot Spitzer, from the State of New York, urges swift

adoption of the amendment, writing that ``the amendment closes loopholes used to manipulate energy markets, improves the ability to detect fraud and other manipulation, and deters manipulation by establishing substantive penalties.''

The North American Securities Administrators Association, the association representing the securities administrators of the 50 States, supports this amendment because it ``would provide more transparency to the wholesale electricity markets, supply the CFTC with the authority to detect fraud and manipulation, and help to deter wrongdoing by significantly increasing the penalties for violations of the Federal Power Act.''

Consumers Union, the Consumer Federation of America, Public Citizen, and the U.S. Public Interest Research Group support this amendment. They state it ``would go a long way towards addressing the serious problems plaguing the Nation's energy markets.''

The Derivatives Study Center comments that ``this important legislation will assure that [energy commodities] will be covered by Federal prohibitions or fraud and manipulation. . . . It will subject [energy] derivatives to some of the same regulations that apply to securities, banking, exchange-traded futures and options and other sectors of U.S. financial markets.''

The National Association of State Utility Consumer Advocates writes that this legislation ``will help fix broken energy markets and given regulators the tools needed to protect consumers from market manipulators.''

One hundred and fifty years of history of our commodity markets demonstrates that market integrity and investor confidence will not magically spring up in markets that have been tainted by manipulation. That same history shows that fair and efficient markets do not emerge by themselves. Rather, regulation and oversight are necessary to ensure that markets are fair and efficient. Without fair and efficient, and that means transparent, energy markets consumers will pay higher prices for energy products, capital will be misallocated, and out national economy and energy security will be harmed.

This history also shows that a legal prohibition against commodity market manipulation, without more, does not deter or prevent manipulation. Continuous market disclosure and oversight are essential to halt manipulation before economic damage is inflicted upon the market and the public. This is why a major portion of the CFTC's budget and resources is devoted to oversight of the futures markets.

Although some enforcement actions have been brought following the manipulation of the western markets, these enforcement actions will do little to make whole the consumers and businesses that suffered billions of dollars in losses from those misdeeds. It would be far better to ensure that such abuses do not occur in the first place, rather than rely on the hope that a few of the manipulators are caught after the fact.

We cannot afford to have more Enrons, more manipulations, more frauds, and more flight of capital in the energy sector. It is imperative that we restore the integrity and credibility of our energy markets.

Our bipartisan amendment will help create fair and transparent energy markets that investors can trust.

Mr. President, I thank the Senator from California for her tenacity on this and so many other issues. But in this matter she and her State have suffered firsthand probably more than any other State as a result of this Enron loophole which she is so heroically and determinedly trying to close this afternoon.

Will the Senator withhold for a unanimous consent request?

Madam President, while that is being considered, I ask unanimous consent that a statement of the American Public Gas Association, supporting the amendment; a statement of Attorney General Eliot Spitzer, supporting the amendment; a statement of the North American Securities Administrators Association, supporting the amendment; a statement from the Consumers Union, Consumer Federation of America, U.S. Public Interest Research Group, and Public Citizen, supporting the amendment; and a statement from the Derivatives Study Center be printed in the Record.

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

Mr. President, I ask that I be recognized to speak for up to 10 minutes with the time coming from the time previously allotted to Senator Kennedy.

Mr. President, I am disappointed in the conference outcome on the emergency supplemental appropriations for Iraq and Afghanistan Security and Reconstruction. I had hoped that the conferees would have followed the Senate's decision to provide one-half of the funding for Iraqi reconstruction as a loan, which could become a grant only if 90 percent of Iraq's bilateral debt was forgiven. A loan would have given the Iraqis a stake in the reconstruction of their own country, which is important, I believe, for them and for us.

Beyond that issue, I am also disappointed at the administration's response thus far to a proposal most recently made by the October presiding officer of the Iraqi Governing Council, Iyad Alawi, in an opinion piece in the New York Times on Sunday, October 19. I wrote to Secretary Rumsfeld on October 22 to bring Mr. Alawi's proposal that Iraqi Army units be recalled at the mid-officer level and below to his attention and to ask that he consider it.

I ask unanimous consent that my letter to Secretary Rumsfeld be printed in the Record at the end of my remarks.

Last week I discussed the proposal with Ambassador Bremer, and I urged him to raise this issue with the entire Iraqi Governing Council. Last Friday, I discussed the issue further on the Senate floor.

The conference report before us contains $3.2 billion for Iraqi security and

law enforcement, and an additional $1.3 billion for justice, public safety infrastructure, and civil society. Included in those amounts is funding for the Iraqi police, border patrol, facilities protection services, the Iraqi civil defense corps, and the New Iraqi Army. While I strongly support that funding, I again call upon Secretary Rumsfeld and Ambassador Bremer to consider reassembling the units--and I emphasize units--of the Iraqi Army, and I call upon them further to ask the Governing Council in Iraq, which we established, for their advice and recommendations on the wisdom of reassembling units of the Iraqi Army.

The security situation is too serious for us to stand on ceremony. The decision of May 15 to disband the Iraqi Army may turn out to be a major mistake. The decision made on May 15 was against the advice of a study conducted under the aegis of the Department of State. It resulted in a significant Iraqi security force being tossed to the wind.

The major reason given by the Department of Defense for not reconstituting the Iraqi Army is that the army melted away when we attacked. But that happened because most of its members did not want to lay down their lives for Saddam Hussein. In fact, it was because Saddam Hussein knew the Iraqi Army might not fight for him that he created his special security forces.

The fact that the Iraqi Army would not fight for Saddam is one of the reasons we should consider reconstituting it. It is surely not a reason for not doing so.

Let me be clear, it is the units of the Iraqi Army about which I am talking. The administration's response to this proposal--that they are already signing up members of the Iraqi Army--is disingenuous. While they are using individual members for various security functions, the New Iraqi Army they are creating from scratch currently has fewer than 1,000 members.

We cannot afford to transfer security functions to Iraqis at that slow a pace. Americans are the target of more and more deadly attacks. The quicker we get the Iraqi Army back in place, the more security we are likely to have and the better off Iraq will be.

Nobody suggests that the Baathist army officers be reinstated. The proposal is that mid-level officers and below be called back and that they be vetted to rid their number of those who committed crimes under the old regime.

When I personally urged Ambassador Bremer last week to consider doing so, I further asked him to commit to taking up this issue with the Iraqi Governing Council. His reply was ambiguous, and that will not do in this extremely dangerous situation.

Ambassador Bremer is running Iraq at this time, to the extent that anyone is, but that doesn't give him a monopoly on wisdom. We are not smarter than everybody else in the world, particularly about other countries and their traditions and cultures. We should consult with the Iraqis who are presently carrying out governing functions.

In issuing Coalition Provisional Authority Regulation No. 6 last July 13, Ambassador Bremer specifically committed to ``consult and coordinate on all matters involving the temporary governance of Iraq'' with the Iraqi Governing Council. He should do so urgently, and he should do so visibly if we truly believe Iraq can become a democratic state. The judgment of the Governing Council on this issue may not be unanimous, but it is relevant.

There is another reason to consider shifting course. Today, the Iraqi Army is being paid a lot of money to do nothing--$25 million a month. We know who the officers and the noncommissioned officers are and where they live. Many of them are probably frustrated and angry because they believed they were serving their country by refusing to fight for Saddam.

The stubborn refusal to reconsider decisions will not do in the dangerous security situation we face in Iraq. Stubbornly staying the course we set when we disbanded the Iraqi Army, instead of considering changing course to improve the security situation, cannot be tolerated. We do not need confessions of error. What we do need is a willingness to try some new approaches. At the top of the list should be to reconsider the May 15 decision to disband the Iraqi Army and, as part of that process, to involve the Iraqi Governing Council in reconsidering that decision.

Exhibit 1

Dear Mr. Secretary: Attached is a copy of an OP-ED piece

from the Sunday, October 19, 2003 edition of the New York

Times written by Iyad Alawi, the president of the Iraqi

Governing Council for the month of October.

This highly-significant article calls for the call up of

the Iraqi Army at least up to the mid-officer level, with

appropriate vetting by the Coalition and the Iraqi Interior

Ministry, as a way of more quickly relieving the burden on

American troops and replacing them with Iraqi soldiers who

have credibility and legitmacy with the Iraqi people.

Since it appears that, despite the adoption of a new UN

resolution on Iraq, there are unlikely to be large numbers of

additional foreign troops made available for duty with the

Coalition, Mr. Alawi's proposal strikes me as worthy of

serious consideration.

I would welcome an opportunity to discuss this matter with

you personally and, in any event, would solicit your views on

this matter.

Sincerely,

Carl Levin,

Ranking Member.

Enclosure.

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

I do withhold.

Mr. President, I will vote for the Interior appropriations conference report because it contains valuable funding for Michigan's parks, trails, museums, and forests. However, I have reservations about several aspects of this legislation.

I am disappointed that the conference report does not include the language I offered with Senator Collins, unanimously adopted by the Senate, which would have directed the Department of Energy to develop procedures to ensure the Strategic Petroleum Reserve is filled in a manner that minimizes the cost to the taxpayer and maximizes the overall supply of oil in the United States. The amendment expressed the sense of the Senate that the Department of Energy's current procedures for filling the SPR are too costly for the taxpayers and have not improved our overall energy security.

Since early 2002, DOE has been acquiring oil for the SPR without regard to the price of oil. Prior to that time, DOE sought to acquire more oil when the price of oil was low, and less oil when the price of oil was high. In early 2002, however, DOE abandoned this cost-based approach and instead adopted the current cost-blind approach. Because over this period the price of oil has been very high--often over $30 per barrel--and the oil markets have been tight, this cost-blind approach has increased the costs of the program to the taxpayer and put further pressure on tight oil markets, thereby helping boost oil and gasoline prices to American consumers and businesses.

The DOE's cost-blind approach has proven to be very expensive without much benefit to energy security. DOE's staff estimates that in just 2 years, 2000 and 2001, the policy now abandoned by DOE saved the taxpayer approximately $175 million, and that a continuation of this policy could have saved the taxpayer additional hundreds of millions of dollars through 2005. Economists estimate that the DOE's current policy has increased the cost of crude oil by up to $1.75 per barrel of oil, and 5 to 7 cents per gallon of gasoline at the pump. DOE's own figures also show that under the new policy overall energy security--as determined by the total amount of oil in both governmental and private storage--has barely increased.

I am very concerned that without the direction provided in the Senate's version of this bill, the American consumers, businesses, and the taxpayers

will continue to pay dearly for the Department of Energy's cost-blind approach to acquiring oil for the Strategic Petroleum Reserve, with only minimal, if any, benefit to our energy security.

The Department of Energy does not need new authority, however, to adopt sound business practices. DOE already has sufficient legislative authority to improve the cost-effectiveness of the SPR program. The Department of Energy should try to better spend the taxpayers' dollars and improve our overall energy security. I urge the Department to follow the direction unanimously adopted by the Senate and improve its procedures for filling the SPR.

In addition, I am also concerned about a provision in the bill which limits the Department of the Interior's ability to perform its legal and statutory responsibilities with respect to the 1994 American Indian Trust Management Reform Act. For several years, Native Americans have come to expect that the Federal Government and, specifically, the Department of the Interior would rightfully manage and account for the Native-American trust fund. Unfortunately, because the U.S. Government has not adequately fulfilled its obligations, Native Americans have had to use the judicial system to have their rights enforced. A rider on this Interior Department conference report, which was not included in the either the House or Senate bill, was added in conference which abrogates the rights of 500,000 Native Americans. The provision, which legislates on an appropriations bill, sends the wrong message to Native Americans that their judicial gains can be changed by an act of Congress, drafted in a backroom and added by a conference committee when neither House had approved the language.

A full and appropriate accounting of the Native-American trust fund is necessary to make sure that the tribes are treated fairly. To overturn court decisions through undebated legislation is not good practice, especially when the judicial proceedings are ongoing. The trust fund contains approximately $176 billion while an appropriate accounting of the fund would cost an estimated $9 to $12 billion.

There are also antienvironmental provisions in this bill that I do not support. Language in the conference report will roll back the moratorium on offshore drilling in Bristol Bay, reduce judicial review on Tongass timber sales, and waive National Environmental Policy Act, NEPA, review for expiring grazing permits.

Further, the conference report also drastically reduces funding for the Land and Water Conservation Fund, LWCF. Lower funding of the LWCF may result in the inability to purchase and protect land needed for habitat around the Great Lakes. It also could result in land being developed which will result in more pollution flowing into the tributaries and the Great Lakes.

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

Mr. President, last week a memorandum on the war on terrorism from Secretary of Defense Rumsfeld to his top subordinates was leaked to the press. In that memo, Secretary Rumsfeld asked a number of questions, including the following: Is our current situation such that ``the harder we work, the behinder we get?'' Then he asked: ``What else should we be considering?''

Well, I am dismayed that Secretary Rumsfeld says publicly something so differently than what he has said privately. I am glad he is looking for new direction since our post-Saddam policy is not working well, given the sustained and increasing attacks on our forces.

Secretary Rumsfeld asked--again--``What else should we be considering?'' Well, the President of the Iraqi Governing Council has made a specific recommendation for us to consider: that the regular Iraqi Army units be called up to assist our troops in providing security for the reconstruction of their country.

Surely it is worthy of our consideration, when Iyad Alawi, this month's serving President of the Iraqi Governing Council--the 25-member body selected by the United States to represent the Iraqi people--is making a suggestion to change course.

He wrote an important opinion piece entitled ``America Must Let Iraq Rebuild Itself,'' which was published by the New York Times on October 19. The main premise of the article is that ``ultimately, only Iraqis themselves can restore security, rebuild national institutions, enact a constitution and elect a democratic government.''

I believe all of us would agree with that premise. For Mr. Alawi, the vital step is to ``call up the Iraqi Army and the national police force [for] at least up to the mid-officer level'' to deal with the insecurity and chaos in the country.

Mr. Alawi believes the Iraqi officer corps will have to be vetted to remove those who have committed crimes under the old regime. He points out that most of the Iraqi Army's soldiers are ``Iraqi patriots who chose not fight for Saddam Hussein'' and ``would probably return to their units and contribute to their country's future.'' He argues that it would be ``much easier and quicker to retrain and reequip them within their existing organizational structure than to start from scratch.''

Mr. Alawi argues that these steps would not only relieve the burden on American troops but also would gain substantial good will among Iraqis.

Tom Friedman, writing in the New York Times, on October 23, is of a similar mind. He urges the administration to declare the following: ``We thank all the nations who offered troops, but we think the Iraqi people can and must secure their own country. So we're inviting all former Iraqi Army soldiers (not Republican Guards) to report back to duty. For every two Iraqi battalions that return to duty (they can weed out

their own bad apples), we will withdraw an American one. So Iraqis can liberate themselves. Our motto is Iraq for the Iraqis.''

That is from Tom Friedman, who has been a very strong supporter of the administration's military actions in Iraq and the decision to attack Iraq.

The administration and the Coalition Provisional Authority have taken a different tack in reorganizing Iraqi security, particularly with regard to the Iraqi Army. They are essentially starting from scratch to build a completely new Army of 40,000 people who are being trained and equipped as a motorized infantry.

The goal is to form nine brigades by the end of 2004, but thus far only one battalion of 750 soldiers has been trained and equipped.

Additionally, the Coalition Provisional Authority is creating an Iraqi border patrol force, only 5,000 to date, with the need to expand to more than 20,000 sometime in the future. A 20,000-person Facilities Protection Service is intended to take over security at fixed site locations from coalition forces, and an Iraqi civil defense corps of 6,600, expanding to more than 15,000 in 2004, is being integrated into coalition military units to provide local intelligence and help with security patrolling.

While I have some questions regarding the need for four distinct security forces, including a new Iraqi Army, in addition to a new national police force, I am open to arguments that this approach to building a new army may be desirable in the long run. A better educated, trained, equipped, and motivated army, whose members are more representative of the diverse Iraqi population, and which was created expressly to serve the people of the new Iraqi state, may be more ideal.

However, in the short term, I believe Mr. Alawi's recommendation to reconstitute units of the old regular army is surely worthy of consideration. No one, including Mr. Alawi, argues for a continued role for those portions of the old army that were part of the repressive security apparatus of the Saddam regime--units such as the Special Security Guards, the Special Republican Guards, and the Fedayeen Saddam.

In fact, those units were created by Saddam because he did not trust his regular army. In that portion of the State Department-sponsored ``The Future of Iraq Project,'' dealing with Iraqi Armed Forces, the Working Group that wrote this part of the report, discussed this issue.

They noted the following: ``Saddam Hussein realized, with his sense of security, that he will not be able to earn the loyalty and trust of the army with its varied character in spite of many attempts to purify or clean the army from the disloyal elements--as he called them--in order for the army to become an army of ideology to protect the party and the revolution and defend the nation's values.'' They added that ``Thus the army remained a source of worry, suspicion and threat to Saddam; in spite of the fact that the army got into its many wars because Saddam desired it. There are some who think that the army was pushed into these wars to keep it continuously busy confronting outside aggressions.'' Finally and in view of these findings, the Woking Group concluded that ``In any event we think it necessary to keep the basic structure of the army, which can be easily rehabilitated. . . .''

That regular army, below the midofficer level, after vetting, could serve a useful role by putting trained Iraqi forces into the field to more quickly enhance overall security. The regular Iraqi Army was a sizable force of approximately 80,000 officers, 130,000 noncommissioned officers, and 400,000 conscript soldiers.''

We probably made a mistake in formally disbanding the Iraqi army in May. I wonder if Ambassador Bremer doesn't tacitly believe the same, given the quick decision that was made by him shortly thereafter by agreeing to pay monthly allowances to officers and noncommissioned officers after the unrest that was unleashed by that decision.

Beginning in July, monthly payments were made according to a rank- based scale, ranging from $50 for a noncommissioned officer to $150 for a general, somewhat below the base pay for the various ranks. Additionally, a one-time $40 stipend was paid to former conscripts. Since July, the Coalition Provisional Authority has paid from Iraqi funds approximately $78 million to about 260,000 individuals and just over $15 million to approximately 375,000 conscripts. The estimated cost for the stipend during the next year will be $190 million, if payments continue throughout the year.

In other words, we know where the men and women--mainly men--in the Iraqi regular army are located. They came for those payments, and we know how to locate them, should we make a decision to reconstitute units of that Iraqi army.

That money was well spent. There is ample evidence from other conflicts that unemployed former soldiers can be a destabilizing and a disruptive influence, as some believe is currently the case in Iraq today. In view of the $156 billion that is likely to be appropriated for U.S. military forces in Iraqi reconstruction in fiscal years 2003 and 2004, paying those sums to members of the old regular Iraqi army would be a modest expenditure.

But would it not make more sense to pay those sums to soldiers who are actually doing something? Would it not make sense to quickly reconstitute recently disbanded Iraqi regular army units to take on security tasks that are within their capabilities? Would it not be possible that recently disbanded Iraqi army units would be able to more quickly assume duties for which the border patrol, the facilities protection service, and the civil defense corps are intended, including patrolling Iraqi streets with our own soldiers? Would this not more quickly give Iraqis the responsibility for and a stake in securing their own country? And, more importantly, wouldn't it be better for all concerned if primarily Iraqi soldiers and not Americans were acting to restore security in Iraq and dealing with those who would seek to disrupt it?

The Governing Council President thinks so.

I ask unanimous consent that an article written by the current President of the Iraqi Governing Council, Iyad Alawi, entitled ``America Must Let Iraq Rebuild Itself,'' which appeared in the New York Times on October 19, be printed in the Record at the conclusion of my remarks.

I asked Ambassador Bremer when we met with him: At a minimum, would he not raise this issue with the Governing Council to see whether or not the views of the President of the Governing Council, that the Iraqi army regular units should be reconstituted, represent the views of the Governing Council itself. We surely should listen to those views. These are the folks we put in office there as representing the Iraqi people. At a minimum, I urged Ambassador Bremer to find out formally from that Governing Council whether or not the President's views, as represented by this article in the New York Times--that the regular units of the army, properly vetted to make sure we don't hire old members of the Saddam leadership--should be reconstituted to help us maintain order and security in Iraq.

I believe Ambassador Bremer will in fact make that request of the Governing Council--not the request to reconstitute the army, because I don't think Ambassador Bremer is there yet, but the request of the Governing Council to see if they agree that it would be wise for those units below the mid-level officer level to be reconstituted, properly vetted, to help us on the streets of Baghdad and in the areas which are very dangerous, and to take some of the pressure off our troops to make us less of a target and to have Iraqis gradually but more quickly take over their own security so that we are not a lightning rod for the folks who are trying to destroy us.

I look forward to the response of the Governing Council of Iraq to Ambassador Bremer's request. We know that as a new Iraqi army is formed, some of the existing units will be retrained and equipped to expand that army. But it is critically important that we have this question put before that Governing Council. The creation of a new Iraqi army is going very slowly. We are at less than a thousand. We must move more quickly.

The question is, since most of the members who we are hiring for that

new army are members of the old army in any event, would it not be much quicker to reconstitute the units of that old army--again, below the mid-officer level, so we don't have the Saddam regime involved--would it not be much quicker to follow the suggestion of the President of the Governing Council, reconstitute the units and move on from there?

The Secretary of Defense asked, in his leaked memorandum, if what the U.S. is doing is enough and what else should be considered. I am glad he asked those questions. As I said before, I am sorry he has not said publicly what he said privately in terms of his doubts and concerns. But having said that, I am glad he is raising questions. I am glad he is asking questions about whether we should change course in some way.

I have written to the Secretary of Defense to solicit his views on Mr. Alawi's proposal. Again, I hope Ambassador Bremer does consult with the Iraqi Governing Council, seek their recommendations on this issue, and not only solicit their recommendations but seriously consider ways to formulate an integrated and comprehensive plan to move more quickly to involve Iraqis in their own security and in their overall governance.

Exhibit 1

[From the New York Times, Oct. 19, 2003]

America Must Let Iraq Rebuild Itself

(By Iyad Alawi)

Baghdad, Iraq.--No Iraqi will ever forget the momentous

April day when a crowd of hundreds of cheering Baghdadis,

helped by an American armored vehicle, pull the huge statue

of Saddam Hussein to the ground. With this act, we tore down

three decades of tyranny and repression and began building in

its place a foundation for freedom, democracy and a better

future for our children.

To see that this goal is achieved, the Bush administration

has challenged me and my colleagues on the Iraqi Governing

Council to draft a permanent constitution within six months

and to move as quickly as possible to hold internationally

monitored, free elections. We gladly accept that challenge,

and welcome the vital assistance of the United Nations,

through the Security Council resolution passed on Thursday,

to see through to completion the enormous task ahead.

But we also realize that there are obstacles on Iraq's

march toward democracy. In the months since Iraq was

liberated, jubilation has given way to insecurity and chaos.

When my fellow Iraqis finally go to the polls to elect their

government, they must have confidence that state institutions

are not only legitimate and independent, but robust enough to

guarantee safety and civil rights. That is why the coalition

and the council must take several immediate steps to

establish these necessary conditions for the constitutional

process to succeed.

First, it is vital to call up the Iraqi Army and the

national police force, at least up to mid-officer level. The

coalition's early decision to abolish the army and police was

well intended, but it unfortunately resulted in a security

vacuum that let criminals, die-hards of the former regime and

international terrorist flourish. And the coalition's plan to

build a 20,000-member lightly armed force mostly responsible

for security and border control could make poor use of a

valuable resource: the 300,000 Iraqi soldiers who simply went

home with their weapons in the face of the American-led

invasion.

Most of these soldiers are Iraqi patriots who chose not to

fight for Saddam Hussein. Americans should not confuse the

Iraqi Army with the hated Republican Guard, which Saddam

Husseim created precisely because he distrusted the

legitimate military. In one simple process, the coalition

authority can support the governing council to call the army

back to its barracks for retraining and, ultimately, for

redeployment. Most soldiers and their officers will proudly

return to their units and contribute to their country's

future.

The coalition and the Iraqi Interior Ministry can vet

officers to remove those who committed crimes under the old

regime, and then rapidly redeploy the most capable units to

work with, and progressively relieve, American troops of

security duties. Iraqi Army units have an established chain

of command and esprit de corps. Not only can they be recalled

to barracks immediately, but it would be much easier and

quicker to retrain and re-equip them within their existing

organizational structure than to start from scratch.

By supporting the recall of army units, the United States

would not only speed the process of relieving the burden on

its troops, it would also gain substantial good will in Iraq.

In contrast, any American-led military presence, even if

complemented by the United Nations, will never have the

credibility and legitimacy that the Iraqi Army has among the

people.

In addition, the Iraqi national police must also be

recalled. Most Iraqi policemen--as opposed to Saddam

Hussein's feared intelligence and security organs--are

dedicated to law and order. The United States does not have

the time or money to create a police force from the ground

up, nor is it necessary, because we have a large, organized

force that is ready and willing to serve.

Many other Iraqi governing institutions should also be

reactivated by the governing council, with the support of the

coalition authority. Special priority must be given to the

Ministries of Interior, Justice, Finance, Oil and Education.

The Iraqi bureaucracy must also be called back to work,

although of course after screening to disqualify serious

offenders of the former regime. Together, the council and the

coalition leaders can modernize the state apparatus, phase

out obsolete policies and practices, and encourage a new

mindset of transparency and efficiency.

Finally, as security improves, Iraqi institutions are re-

established and the constitutional drafting process is

completed, the United States should support international

recognition of Iraqi sovereignty. Then a recognized interim

government could quickly present a popular referendum, under

United Nations monitoring, on the new national constitution.

It would be a grave mistake for the United States to hold out

sovereignty and international recognition as the reward for

passage of a constitution. Rather, making Iraqis once again a

part of the international system is the prerequisite of

successful reconstruction and a durable democratic system.

Iraqis are grateful for the tremendous efforts and

sacrifices the United States is making on our belief. Yet,

ultimately, only Iraqis themselves can restore security,

rebuild national institutions. enact a constitution and elect

a democratic government. America must not rebuff Iraqis who

are eager to have a stake in this intimate national process.

Like any free people, we want to ensure that we are in

control of our own destiny.

I suggest the absence of a quorum.

Mr. President, yesterday the Cannon House Office Building was temporarily evacuated when a staff member apparently carried a toy plastic gun past a Capitol Police security check point. This incident reminds us of how important it is that we maintain adequate security in our public buildings. Even though I raised this issue last week, I want to take this opportunity to highlight the importance of the Terrorist Firearms Detection Act, a bill introduced last week by Senator Kennedy. Originally passed in 1988, and sometimes called the ``plastic gun'' law, this Federal law makes it illegal for any person to manufacture, import, ship, deliver, possess, transfer or receive any firearm that is not detectable by walk-through metal detectors or the type of x-ray machines commonly used at airports.

Since September 11, 2001, Congress has worked hard to improve the security of our borders, airports, Government buildings, and communities. In just over a month, on December 10, the plastic gun law is set to expire. The Terrorist Firearms Detection Act would permanently reauthorize this law. I support this bill because plastic guns, whose production has been endorsed by the National Rifle Association, should only be used by our military and intelligence agencies.

This legislation has the support of major gun safety organizations, including the Brady Campaign to Prevent Violence United with the Million Mom March, Americans for Gun Safety, and the Violence Policy Center. The Department of Justice, while failing to endorse Senator Kennedy's permanent ban, has indicated its support for extending the current ban.

I urge my colleagues in Congress to act quickly to pass the Terrorist Firearms Detection Act, so that hopefully President Bush can sign it into law.

Mr. President, I cannot support the Climate Stewardship Act of 2003 since its effect, if enacted, will be the loss of more manufacturing jobs to countries which have few, if any, environmental standards. That won't help the environment, and it will hurt our economy. Climate change is not something we can tackle by shifting industries and their emissions to other countries, or by shifting manufacturing jobs to China or other countries which have no limits on emissions of greenhouse gases. The bill before us reflects a unilateral approach to a problem which can only be solved globally.

Let me give one example of how this bill would promote job loss in the U.S. with no benefit to the global environment. In the past decade, a large number of companies have moved their manufacturing plants overseas. Take, for example, a U.S. manufacturing company that had seven plants in the U.S. in the 1990s. Today it has only five left, because two moved to countries with cheaper labor. Assume that those five remaining domestic plants each emit 20,000 metric tons of carbon dioxide for a total of 100,000 metric tons. Under this legislation, reasonable estimates are that the company's cap could be placed at around 90,000 metric tons of carbon dioxide credits. The company, already under heavy competition because of cheap labor costs overseas, faces a choice: pay to reduce emissions at its five plants by 10 percent, or move another one of its plants overseas, say to China. If the company moves one of its five plants abroad, it has 10,000 credits remaining to play with which it can use to actually increase emissions at its four remaining plants, or it can sell them. So this bill adds to existing incentives, such as lower labor costs and no safety standards, to move manufacturing plants overseas, and the result is that we lose jobs and the environment gains nothing. In other words, when this bill's mandates are imposed on sectors of the economy that can pick up and move overseas, it adds another incentive to do just that.

The United States must take a leadership role in addressing climate change, but that leadership must move us in the right direction. It is not sound leadership to give additional incentives to U.S. businesses to move their facilities, and the jobs that go with them, to other countries that don't have the costly environmental standards which this bill would impose on U.S. businesses. It is not sound leadership to simply shift industrial emissions from American soil to countries which have no emissions standards. And it is certainly not sound leadership to act unilaterally in a way that puts U.S. manufacturers at a competitive disadvantage when there is no built-in incentive for other countries to follow. In fact, the opposite is true: the unilateral approach in this bill provides an economic incentive for countries who are picking up our manufacturing jobs not to follow our lead.

Effective and sound leadership would be to tell competing countries that we are going to adopt high environmental standards if they will join us, or, in the alternative, leadership is getting countries to agree (1) to the adoption of tough environmental standards, and (2) to refuse to purchase products from countries which won't adopt those environmental standards. Sound leadership, in other words, is working to create an international agreement where all countries take steps to reduce global warming, so that there is no incentive to move jobs and emissions from a country with high environmental standards to one with low environmental standards.

Climate change cannot be addressed unilaterally. It must be addressed multilaterally. It doesn't help the global environment to push down greenhouse gas emissions in one country only to have them pop up in others. We need a Kyoto-type treaty which binds all countries. Otherwise, there is a perverse incentive to move more and more jobs to countries with lower environmental standards. That does nothing to reduce greenhouse gas emissions and does damage to U.S. jobs.

To achieve a global agreement will require our putting maximum pressure on all countries to join it, so that the emissions of greenhouse gases can be reduced, not just shifted. Shifting manufacturing jobs and the production of greenhouses gases from here to other countries is not a solution to climate change. It would just be another economic blow to America at a time when our economy is already losing jobs at an historic and alarming rate.

We have already lost enough American jobs to countries with cheap labor, no safety standards and no environmental standards. To add more incentives for companies to move overseas to countries with no limits on greenhouse gas emissions, as this bill would promote, is not sound policy. Global climate change is just that: global and it needs to be dealt with globally, not unilaterally.

Madam President, I express my support for the Terrorist Firearms Detection Act, a bill introduced earlier this week by Senator Kennedy. Originally passed in 1988, and sometimes called the ``plastic gun'' law, this Federal law makes it illegal for any person to manufacture, import, ship, deliver, possess, transfer or receive any firearm that is not detectable by walk-through metal detectors or the type of x-ray machines commonly used at airports.

Since September 11, 2001, the Congress has worked hard to improve the security of our borders, airports, government buildings, and communities. However, in just over 2 months, on December 10, this essential common sense gun safety legislation is set to expire. The Terrorist Firearms Detection Act would permanently reauthorize the plastic gun law. Plastic guns, whose production has been endorsed by the National Rifle Association, should only be used by our military and intelligence agencies and must never find their way back into our communities.

This legislation has the support of every major gun safety organization in the country, including the Brady Campaign to Prevent Violence United with the Million Mom March, Americans for Gun Safety, and the Violence Policy Center.

The overwhelming majority of my colleagues would agree that plastic guns pose a clear and present danger to our nation's aviation security, as well as governmental targets across the country. In fact, Pete Shields, the former president of Handgun Control, the predecessor organization to the Brady Campaign to Prevent Violence, said it well in testimony before the House Judiciary Committee in 1988.

Weapons which evade security devices put us all at risk.

Every airport, every courthouse, every public building which

relies on screening devices for security will no longer be

safe. At a time when our Nation is committing vast resources

and energies to stopping terrorism and protecting our

citizens abroad, we should not even consider making it easier

for terrorists to operate in our own country.

I urge my colleagues in the Congress to act quickly to enact this legislation, and I also hope that President Bush will soon sign this important gun safety legislation into law.

Mr. President, first, I thank the chairman of the Armed Services Committee for his extraordinary effort in putting together a proposal which I am pleased to support. For the reasons he gave, it is a much more honest approach to the acquisition of these tankers. There is no use pretending this is a lease when, in fact, it is intended to be a sale. It has been the intent of the Air Force they purchase it. It has been wrapped in the clothing of a lease but, in fact, the clear intention here and the only commonsense outcome is that it be a purchase, not a lease, because under the lease agreement, 80 percent of the cost of these planes would be laid out by the Air Force while only 20 percent of their useful life would have been actually used by the time the lease was over. It is obvious the intention and the commonsense approach was this is intended to be a purchase and it ought to be called what it is.

The proposal I am pleased to join in sponsoring is much more honest in terms of the intention. It also complies much more closely to what the normal budgeting procedures are around here. We do not want this to be a precedent for leasing. That distorts the entire budget process because it looks like it is free, in essence, for a couple years. These are not free. There is a huge cost. If we can reduce the real cost, as this proposal does, by acknowledging that it is really a purchase, by authorizing a multiyear acquisition, which is what we do after the leasing of the first 20, it seems to me we will save taxpayer dollars, we will commit to actually acquiring these tankers, but we will force the Air Force to be straightforward in the use of this country's resources. They are not going to be able to have something which looks free for a couple years because there is a small lease payment and then have this huge obligation in the outyears.

At the same time presumably they will want to buy more and more tankers. We address the long-term need to acquire tankers. We do it in a more straightforward way. We save money for the taxpayers.

I commend the two Senators from Washington, Senators Murray and Cantwell, for being so persistent in moving this program forward. This outcome would not have happened without them. I also acknowledge Senator McCain's role. He has insisted from the beginning this be reviewed in an honest way by the General Accounting Office, by the Congressional Budget Office, and by the Armed Services Committee. It has been his insistence we deal with this honestly. That has led to this proposal. I have not had a chance to speak with Senator McCain personally or directly so I don't know what his reaction is. I hope it meets his expectations and his needs. I do acknowledge the fact that Senator McCain is always playing it straight, looks at things straight, and wants an honest addressing of an issue. That is what we are now doing.

To the two Senators from Washington and the Senator from Arizona, I express my thanks, and particularly the chairman of the committee, who put together a proposal which I am pleased to join.

The members of the committee have spent considerable effort in reviewing the basic Air Force proposal to sign a long-term lease for 100 KC-767 tanker aircraft. Based on my review of the issues surrounding this proposal, I support Senator Warner's intention to offer the proposal he outlined in the conference on the National Defense Authorization Act for fiscal year 2004.

Let me also recognize the strong and positive role that the two Senators from Washington, Senator Patty Murray and Senator Maria Cantwell, have played in moving the leasing program forward. I know personally that they have spent many hours understanding the current Air Force tanker situation, and in working with other members of the Senate in moving this program forward.

The proposal to go forward with a lease of 20 aircraft now and providing, up-front, multiyear procurement authority for the Air Force to buy the remaining 80 tankers should help address several concerns.

First, it will help address our long-term need to replace the Air Force's existing fleet of tanker aircraft. We have spent many hours trying to understand the severity of the corrosion problem within the KC-135 tanker fleet. While the Air Force has not made a convincing case that there is an imminent risk to the fleet, the Air Force does have a long-term requirement for tankers that will ultimately require the fielding of replacement aircraft. For this reason, I believe that it is prudent to move forward now with an orderly replacement program.

Second, our approach would give the Air Force multiyear contracting authority now. This will reduce the acquisition cost for aircraft, significantly reducing the price to be paid by the

taxpayers. I believe that providing such multiyear contracting authority is a responsible step to take in the case of a program like this, which involves very little new development and very little program risk.

Third, the proposal that Senator Warner and I are putting forward would address very real concerns with the lease proposal presented by the Air Force. I believe that what the Congressional Budget Office said is correct: this is not a real lease, but a purchase. The Air Force, not Boeing, will control the special purpose entity that borrows funds for this program. There is no doubt in anyone's mind that the Air Force intends to buy these aircraft at the end of the lease. We simply cannot afford to pay 90 percent of the value of the aircraft for less than 20 percent of the useful life.

Finally, our proposal would take a far more responsible approach to federal budget issues than the proposal put forward by the Air Force. The Air Force proposal would have pushed the cost of the tanker aircraft off until the next decade, creating a huge funding program for the next generation of Air Force leaders. Our approach would move the costs forward, requiring the Department of Defense to provide almost $5 billion more in current Future Years Defense Program. The Air Force case that it is urgent to replace these tanker aircraft will be a lot more convincing, if the Department of Defense is willing to put money up for the problem earlier, rather than taking a free ride on the back of future taxpayers and defense needs.

I hope that we will get agreement from the House conferees on the defense authorization on including this provision in the final authorization act. I believe that it will help address a significant problem identified by the Air Force, while acting more responsibly in preventing postponing too much funding to later years.

I thank Chairman Warner for his leadership on this issue.