Floor Statements

Mr. President, I would like to take a few minutes to highlight the tax piece of the housing bill that is before the Senate today. From the beginning, Chairman Baucus and I had a goal. We wanted to develop a bipartisan tax package that responded to the needs of Americans facing difficulty in the housing market. Up until the last stage of this journey, in terms of the process, we met that goal. Unfortunately, at the last stage of the process, when the last House amendment was developed, a bipartisan process became a Democrats-only process. That is unfortunate. It is not the way we have done business in the past. Hopefully, it won't become a pattern.

Mr. President, this bill, with one exception, complies with the Senate Republican conference principles on use of revenue raising offsets. This bill contains new tax policy. The new tax policy is offset with revenue raisers that a bipartisan majority in the Senate consider improved tax policy. The main one would put in place a reporting regime on credit card payments to merchants. It is a Treasury tax gap proposal. The other significant revenue

raiser would clarify the home sale exclusion rules where second homes, usually vacation residences, are involved.

The one exception deals with a reversal of a sound international tax policy reform. Back in 2004, Congress passed and President Bush signed a major bipartisan business tax reform bill. The centerpiece proposal in the international tax reform area was a restoration of the Finance Committee position from the 1986 Tax Reform Act on the treatment of interest for the purposes of the foreign tax credit. It took us 18 years to get back to the proper treatment of interest. This reform was due to take effect a few months from now.

The proposal in the bill before us delays this important reform by 2 years. It also cleverly haircuts the reform by 70 percent in the year the reform would become effective. The House has offered this offset for several bills. It is currently in play on the House extenders bill. It is also in play on the House trade adjustment assistance, TAA, proposal. In the prior stages of this legislation, it is the only offset on which I have expressed opposition. I offered up other offsets which, in my view, represented good tax policy. They were rejected by either the House or the Senate. I respected the reservations of the House and Senate Democrats on revenue raisers they could not accept. My reservations with this policy were discarded at the final stage in the Democrats-only negotiation.

The revenue grab trumps policy in this instance. The tax increase/ spending increase pay-go imperative is more important than getting the tax policy right. The revenue raised is used mostly for new spending on community block grants. So here we go again. Propose suspect tax policy to feed the insatiable appetite for new social spending.

Now, why am I so opposed to the worldwide interest revenue raiser? My opposition rests in the bad tax policy this proposal represents.

Starting in 2009, the interest allocation reform will lower the chance of double tax that arises under current law from the artificial allocation of interest expense to foreign income, even when the debt is incurred to fund domestic investment. The current rules actually penalize domestic manufacturers that compete in global markets by making it more likely they will be double-taxed on their foreign income.

Several companies have spoken to my staff about the negative ramifications this delay will have on them. These companies are just starting to grow their businesses beyond the U.S. borders. The delay of this important international reform will make it more costly for these companies to expand into these markets. If these companies cannot grow beyond the domestic economy, they will be unable to compete in the global marketplace.

It is long been said that the American dream is to own your home. Unfortunately, the subprime crisis has turned that dream into a nightmare for many Americans. The tax relief in this bill aims to restore the American dream. This package goes some distance to restore that dream, but in the journey this legislation took a wrong turn. The bill goes backward on a bipartisan international tax reform. That is a sorry development. It does not bode well for future efforts at international tax reform. How reliable are proposals from the other side if they are reversed a couple of years later when the pay-go beast growls for more revenue for more spending?

Mr President, there are a lot of good proposals in the tax policy portion of the bill. Unfortunately, in the late stages of its development, it took on a more partisan character.

Mr. President, I am pleased today to introduce the Medicare Imaging Disclosure Sunshine Act of 2008.

I agreed to a short-term Medicare extension bill last December with the understanding that this would give us the opportunity to include other priorities in a bipartisan Medicare package this year. One of the significant issues I had hoped to address was the lack of transparency in physician self-referrals for imaging services in the Medicare program.

The recently-enacted Medicare bill requires accreditation for providers of the technical component of advanced diagnostic imaging services such as magnetic resonance imaging, MRI, computed tomography, CT, scans, and positron emission tomography, PET, and it establishes a demonstration project to assess appropriate physician use of these services. However, Mr. President, the legislation regrettably fails to address an issue that has contributed significantly to the rapid growth in Medicare spending for imaging services: physician self-referrals for imaging services in their offices and in facilities where they own or lease advanced imaging equipment. According to a June 2008 report of the Government Accountability Office, Medicare Part B spending for imaging services more than doubled in 6 years, growing from $6.89 billion in 2000 to $14.11 billion in 2006. During this time, the percentage of Medicare spending on imaging services provided in physician offices grew from 58 percent, about $4 billion, in 2000 to 64 percent, about $9 billion, in 2006. Spending on advanced imaging services, such as MRIs, CT scans, and nuclear medicine, also grew substantially faster than other imaging services.

Beneficiaries need more transparency and disclosure of potential conflicts of interest when physicians write referrals for imaging services. An imaging disclosure provision was included in the Medicare bill that I introduced in June, and it was included in the agreement that Senator Baucus and I reached for this year's Medicare bill. The provision was not onerous nor was it overly proscriptive: it merely required referring physicians to disclose any conflict of interest related to their ownership of advanced imaging facilities or equipment. Patients still would be free to choose their physicians' imaging facility or equipment or to go elsewhere. Unfortunately, the imaging disclosure provision was dropped from the Medicare bill that Congress enacted once the process became partisan.

It is for this reason that I am introducing this bill. The Medicare Imaging Disclosure Sunshine Act does just what the name implies: it requires referring physicians to shed some light on their relationship to imaging facilities and equipment they own by disclosing that ownership interest and providing beneficiaries with a list of alternative providers. The referring physician is required to inform the individual in writing at the time of referral that he or she can obtain imaging services elsewhere if they choose to do so and to provide a list of imaging suppliers located where the individual resides. The imaging services covered by the requirement include MRIs, CT scans, PET, and other radiology services specified as designated health services that the Secretary of Health and Human Services determines appropriate. The requirement would be effective in January 2010.

Technology has made great advances in imaging services in recent years, and improvements in imaging hold much promise for earlier and more accurate diagnoses of life-threatening diseases which often may lead to improved outcomes for patients. But we must do more to help control the potential for overutilization of imaging services. The Medicare Payment Advisory Commission, or MedPAC, and others have expressed serious concerns that the sizeable growth in the volume of imaging services needs to be addressed. In March 2005, MedPAC recommended that the Secretary of HHS establish standards for providers of diagnostic imaging services and measure physicians' use of imaging services with their peers. Those recommendations were addressed to some degree in the Medicare bill that Congress enacted. However, another key MedPAC recommendation--that the Secretary of HHS strengthen the rules limiting physicians' financial incentives to order imaging services-- unfortunately was ignored.

The June 2008 GAO Report noted that physicians in specialties other than radiology generated an increasing share of revenue from in-office imaging services from 2000 to 2006. They also found that in-office imaging spending per beneficiary, like other Medicare spending, varied widely across geographic regions of the country. By 2006, in-office imaging spending per beneficiary varied from $62 in Vermont to $472 in Florida, nearly eight times as much. This raises additional concerns about overuse since research on geographic variations on health care spending shows that, generally, providing more services does not lead to improved health care outcomes. In GAO's view, the shift in imaging services from hospital settings to physician offices has the potential to encourage overuse in light of the financial incentives that exist for physicians to supplement lower professional fees for interpreting imaging tests with relatively higher fees for performing the tests. They concluded that physician ownership of imaging equipment is a way to generate additional revenue for a practice.

The Medicare Imaging Disclosure Sunshine Act will provide another necessary tool to address the significant increase in Medicare spending for in-office imaging services by providing more transparency and shedding some light on physician referrals to facilities and medical imaging equipment they own. I urge my colleagues to support this legislation.

Mr. President, I am pleased today to introduce the Medicare Imaging Disclosure Sunshine Act of 2008.

I agreed to a short-term Medicare extension bill last December with the understanding that this would give us the opportunity to include other priorities in a bipartisan Medicare package this year. One of the significant issues I had hoped to address was the lack of transparency in physician self-referrals for imaging services in the Medicare program.

The recently-enacted Medicare bill requires accreditation for providers of the technical component of advanced diagnostic imaging services such as magnetic resonance imaging, MRI, computed tomography, CT, scans, and positron emission tomography, PET, and it establishes a demonstration project to assess appropriate physician use of these services. However, Mr. President, the legislation regrettably fails to address an issue that has contributed significantly to the rapid growth in Medicare spending for imaging services: physician self-referrals for imaging services in their offices and in facilities where they own or lease advanced imaging equipment. According to a June 2008 report of the Government Accountability Office, Medicare Part B spending for imaging services more than doubled in 6 years, growing from $6.89 billion in 2000 to $14.11 billion in 2006. During this time, the percentage of Medicare spending on imaging services provided in physician offices grew from 58 percent, about $4 billion, in 2000 to 64 percent, about $9 billion, in 2006. Spending on advanced imaging services, such as MRIs, CT scans, and nuclear medicine, also grew substantially faster than other imaging services.

Beneficiaries need more transparency and disclosure of potential conflicts of interest when physicians write referrals for imaging services. An imaging disclosure provision was included in the Medicare bill that I introduced in June, and it was included in the agreement that Senator Baucus and I reached for this year's Medicare bill. The provision was not onerous nor was it overly proscriptive: it merely required referring physicians to disclose any conflict of interest related to their ownership of advanced imaging facilities or equipment. Patients still would be free to choose their physicians' imaging facility or equipment or to go elsewhere. Unfortunately, the imaging disclosure provision was dropped from the Medicare bill that Congress enacted once the process became partisan.

It is for this reason that I am introducing this bill. The Medicare Imaging Disclosure Sunshine Act does just what the name implies: it requires referring physicians to shed some light on their relationship to imaging facilities and equipment they own by disclosing that ownership interest and providing beneficiaries with a list of alternative providers. The referring physician is required to inform the individual in writing at the time of referral that he or she can obtain imaging services elsewhere if they choose to do so and to provide a list of imaging suppliers located where the individual resides. The imaging services covered by the requirement include MRIs, CT scans, PET, and other radiology services specified as designated health services that the Secretary of Health and Human Services determines appropriate. The requirement would be effective in January 2010.

Technology has made great advances in imaging services in recent years, and improvements in imaging hold much promise for earlier and more accurate diagnoses of life-threatening diseases which often may lead to improved outcomes for patients. But we must do more to help control the potential for overutilization of imaging services. The Medicare Payment Advisory Commission, or MedPAC, and others have expressed serious concerns that the sizeable growth in the volume of imaging services needs to be addressed. In March 2005, MedPAC recommended that the Secretary of HHS establish standards for providers of diagnostic imaging services and measure physicians' use of imaging services with their peers. Those recommendations were addressed to some degree in the Medicare bill that Congress enacted. However, another key MedPAC recommendation--that the Secretary of HHS strengthen the rules limiting physicians' financial incentives to order imaging services-- unfortunately was ignored.

The June 2008 GAO Report noted that physicians in specialties other than radiology generated an increasing share of revenue from in-office imaging services from 2000 to 2006. They also found that in-office imaging spending per beneficiary, like other Medicare spending, varied widely across geographic regions of the country. By 2006, in-office imaging spending per beneficiary varied from $62 in Vermont to $472 in Florida, nearly eight times as much. This raises additional concerns about overuse since research on geographic variations on health care spending shows that, generally, providing more services does not lead to improved health care outcomes. In GAO's view, the shift in imaging services from hospital settings to physician offices has the potential to encourage overuse in light of the financial incentives that exist for physicians to supplement lower professional fees for interpreting imaging tests with relatively higher fees for performing the tests. They concluded that physician ownership of imaging equipment is a way to generate additional revenue for a practice.

The Medicare Imaging Disclosure Sunshine Act will provide another necessary tool to address the significant increase in Medicare spending for in-office imaging services by providing more transparency and shedding some light on physician referrals to facilities and medical imaging equipment they own. I urge my colleagues to support this legislation.

I ask unanimous consent to speak for 15 minutes as in morning business.

Mr. President, I come to the floor today to remind my colleagues and the American people, once again, about the deadly tornadoes, storms, and floods that affected the Midwest earlier this year. Iowa, my State, was especially hard hit by this severe weather event. The people in Iowa have great pride and resiliency. They don't like to complain, and it is even harder for them to ask for help. However, I wish my colleagues to know that Iowans are hurting, similar to people in other natural disasters. I see it in their eyes as they sort through the rubble and try to rebuild their lives.

As their Senator, their friend, their neighbor, I am asking my colleagues to help and to help now. I thank my colleagues who have come to me and the rest of the Iowa congressional delegation and other Members whose States were affected. We have all had colleagues come to us to share their condolences and ask how they can help.

However, I have heard some comments that this disaster was not severe enough to warrant special legislative attention. Washington doesn't seem to understand the devastation. That is the way I see it. In other words, it is not on television for 2 months in a row such as it was in New Orleans, so we don't seem to be getting the attention of colleagues such as we did from Hurricane Katrina. But we do have an emergency, and Congress needs to respond such as we did after 9/11 for New York City or after Katrina for New Orleans.

Ten States were affected by this severe weather system. In Iowa alone, 340 communities were affected by these tornadoes, storms, and flooding. Iowa

suffered well over $10 billion in damages. Of this amount, approximately $4 billion was agricultural loss, $4 billion was business loss, and $1 billion was housing damage and loss. Right now, those are very rough figures. I think they are only going to climb every day after these initial estimates.

The floods in Iowa were well over a 500-year flood event level in many parts of my State. For example, the Cedar River in the Cedar Rapids area was 11 feet over record flood stage. Since we began keeping records in the 1850s, the highest flood level had been 20 feet. The levees protecting the city are at 22 feet. In June, Cedar Rapids had 31 feet of water, well over the 22 feet of the levee protection and the the previous record of 20 feet.

Even my small hometown of New Hartford, IA, was first hit by an F5 tornado, which caused several deaths and severe damages and, just 2 weeks later, hit by severe flooding. Mr. President, 240 out of 270 homes had moderate to complete damage. Many of the businesses also suffered severe loss. They are trying to figure out how to stay in business. Unfortunately, for my small town, several have decided not to reopen.

On Monday, I visited the home you see in this photo. This is one of my constituents in Cedar Rapids, IA. As you can see, they have already taken out the moldy drywall. Here, this lady, Shirley, is showing how high the water was on the first floor, and that is after the basement had been completely filled with water. We also couldn't go to the second floor in this home because half of the steps were washed away.

So we are not just talking about standing water. At one point this was rushing water, turning over appliances and leaving boats in people's living rooms. It is people such as Shirley, who are in limbo because Congress is not acting, needing to know what assistance can be provided. They do not know whether the Government will help. Should they stay or should they leave?

Then we have business owners who are worried about their employees not having homes. Will they leave town because they do not have a place to live? Then will the small businesses be closed because customers who use the local diner won't be there or the local flower shop won't be there? It is a vicious circle when you don't have housing for your workers.

My colleagues in the Midwest and I have been working with appropriators on additional emergency assistance to help us with the recovery and with the rebuilding process. I happen to be concerned that this additional emergency assistance is being held up by nonemergency, nonrelated, and, in fact, quite controversial provisions. I believe we should do what we did for New York and what we did for New Orleans: consider the emergency portion separately from other appropriations that people think need to be done, and do it before the August congressional recess.

Aid to the Midwest should not be held hostage to politics. Iowans are beginning to notice the inaction in Congress. I get asked why--why hasn't something been done? I would like to read to you parts of an editorial running in the Waterloo Courier. Waterloo is close to my hometown. I am not going to read it all, but, I want to include the entire editorial in the Record. I will read from just portions of it because it tells what Iowans are thinking about the inaction in Congress and that maybe there is a double standard.

The headline is: ``Congress Needs To Make Time To Help Iowa.''

Iowans who don't agree with the recent minuscule approval

ratings of Congress may want to take a second look. Congress

has delayed consideration of a bill that includes further

disaster aid for Iowa until after Congress' August recess.

The editorial goes on:

That's quite a slap in the face to those people and

businesses already confused by which direction to take

concerning housing and rebuilding issues. The Senate

Appropriations Committee was scheduled to take up the

supplemental package on Thursday, but Senator Robert Byrd,

Democrat of West Virginia, the committee chairman, announced

late Tuesday it was putting off consideration until after the

recess.

Then they quote Senator Byrd:

There is no opportunity to begin consideration of a

supplemental appropriations bill during the next 10 days.

Then the editorial goes on to say that Byrd said the Senate was busy debating legislation on housing, energy, defense policy, and taxes before the recess.

Continuing to quote the editorial:

Our response to Senator Byrd and the rest of the Congress

is: Make the time. Delay the recess if you have to. We'd also

like to remind the Senator of his comments just last month

after areas in West Virginia were ravaged by storms.

The editorial refers to that statement, with Senator Byrd saying this:

Once again, West Virginia has suffered at the hands of

Mother Nature. Every moment counts in the recovery efforts,

and every little bit of help is crucial.

Then the editorial repeats again the last words of Senator Byrd's statement--``every moment counts.'' That was his plea then.

It goes on to say:

Sounds very similar to situations faced today by many Iowa

communities, businesses, families, and individuals. It

appears that Byrd's view on timely assistance doesn't extend

to the Midwest.

Mr. President, I ask unanimous consent to have printed in the Record the entire editorial so people can read it in its entirety.

Mr. President, I have also, as an individual Senator, been working on a comprehensive plan to provide tax relief to flood, tornado, and severe storm victims in the Midwest. My Midwestern colleagues have been helping me with this effort. We urge Congress to act quickly on enacting a tax relief law because we acted very quickly--within 3 weeks--after Katrina for New Orleans.

On Wednesday, I introduced this tax bill with Senators Harkin, Bond,

McCaskill, Coleman, Klobuchar, Durbin, Obama, Roberts, Brownback, Lugar, and Bayh and called it the Midwestern Disaster Tax Relief Act of 2008. The same bill was introduced in the House by the Iowa congressional delegation in a bipartisan fashion.

Federal tax relief has proven to be very helpful to disaster recovery efforts in recent years. We modeled this legislation after the tax legislation that Congress passed to help victims of Hurricanes Katrina, Rita, and Wilma in 2005, and the tornadoes of Kiowa County, KS, in 2007. We took into account the lessons learned from the other disaster packages, so we have been able to slim down this package and tailor it to meet the needs of this major natural disaster and not repeat the mistakes we made for Katrina, where some people who weren't hurt by the disaster were able to take advantage of it.

So we are curtailing the cost considerably. But there is another inconsistency. I have been told by the chairman of the House Ways and Means Committee, Mr. Rangel, that our disaster tax relief package needs to be offset. Well, he didn't hear Chuck Grassley say the tax package we passed for New York City after 9/11 had to be offset. It was an emergency. New York City needed help and New York City got help from this Senator, chairman of the committee at that time. I guess at that time I was ranking member, but still helping. And when Katrina came along, I was chairman of the committee once again, and we did not ask for offsets for Katrina. People in New Orleans were hurting and we passed the legislation and the President signed it 3 weeks after Katrina. We appropriated $60 billion within 5 days after reconvening after Labor Day in 2005.

So I don't want anybody telling me that we have to offset a disaster relief package for the Midwest where people are hurting, when we didn't do it for New Orleans. Why the double standard? Is it because people aren't on rooftops complaining for helicopters to rescue them, and you see it on television too much? We aren't doing that in Iowa. We are trying to help ourselves in Iowa. We have a can-do attitude. It doesn't show up on television like it did in New Orleans for 2 months.

So we are going to move ahead. We have targeted this assistance in this tax bill to those who have suffered damage and lost specifically from this severe weather event--individuals and businesses located in presidentially declared disaster areas due to floods, tornadoes, or severe storms, in just these States--Iowa, Arkansas, Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska, and Wisconsin--just where the harm has happened this spring.

Among other provisions, this legislation would let disaster victims with damages to their primary residence tap their assets and access cash by withdrawing money from retirement plans without penalties and suspend limits on tax incentives for charitable contributions, thus strengthening local and other fund-raising drives collecting money to help small businesses and families recover. We also create tax-credit bond authority to help local governments rebuild infrastructure with interest-free loans; increase the amount of tax-exempt bond authority to help businesses receive below-market interest rate financing; remove limitations on deducting casualty losses due to natural disasters; and reduce the 2008 tax burden for businesses by substantially increasing the 2008 deductions from depreciation and expensing the business property.

We tried to add a disaster tax relief package as an amendment to the housing bill--and I have to say Senators Shelby, Dodd, and Baucus were very helpful in that process--but we didn't get all these details ironed out in time to get it in the housing package.

Mr. President, I ask unanimous consent for 4 more minutes.

We have agreed to pursue Midwestern tax relief either as a separate bill, which would have to start in the House of Representatives, or on another tax bill that is over here under consideration in the Senate. I want to thank Senators Shelby, Dodd, and Baucus, though, for their consideration of putting that in the housing bill.

We have had further discussions since then with Chairman Rangel and Baucus. It is our hope that we can swiftly reach a bicameral agreement with Ways and Means and the Senate Finance Committee on our proposals. I think we basically have it ironed out, except for this offset issue. And we should pass this tax bill in both the House and Senate by unanimous consent before we leave for the August recess. That would get it done in still a longer period of time than it took me to get tax relief for New Orleans.

Once again, assistance to Iowa and the Midwest should not be held hostage to politics and gamesmanship. We treated the victims of the gulf coast with quick and fair action, as I have indicated twice during my remarks. We passed $60 billion in appropriations bills within a week of returning to Washington after the August recess--Katrina happening just days before Labor Day, during our recess--and we passed that tax relief bill that I have mentioned that was signed by the President within 3 weeks. Those were clean bills. They weren't loaded down with controversial extraneous positions and didn't need offsets.

Efforts underway by Democratic leadership are letting down the people of the Midwest. They are trying to use this disaster assistance as a vehicle to promote an agenda and pet projects, and I will give you some examples. The majority would like to include a provision to give $1.2 billion in tax credits to New York City, even though New York City does not pay Federal taxes. This proposal is widely reported to fund the building of a train from Manhattan to John F. Kennedy Airport through the use of New York Liberty Zone tax credits. According to the Joint Committee on Taxation, Congress has never before provided a limited tax benefit such as this to a government unit.

This provision is very controversial, is nonemergency, and it would slow down getting assistance to the Midwest, and Iowans, where people are hurting and hurting right now. I reiterate that politics should not get in the way of helping the victims of the storms and tornadoes in the Midwest. To cut through this hogwash, we ought to pass the Midwestern disaster tax relief bill by unanimous consent even this week.

As Iowans and others in the central United States start recovering and rebuilding their lives and communities after these record deadly storms and floods, they need and deserve swift Federal action. The assistance should not be held up over politics.

I am often asked by constituents not to forget them. Therefore, I am asking my colleagues in Congress this very minute not to forget my constituents or other constituents of Midwestern States. We only ask that Congress give Iowans and those in the Midwest the same consideration we gave victims of other disasters--and most often I mention New York City and New Orleans--nothing more, nothing less.

If any of my colleagues doubt that this is an emergency and that Federal aid is needed, I am in Iowa every weekend--except this weekend, I am sorry to say, because we are in session on Saturday. But whenever they come, I will be happy to show them around. I have all kinds of pictures, which I think my staff has been putting up from time to time, to demonstrate this disaster that we have had in the Midwest.

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

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

Mr. President, I ask the Senate stand in recess subject to the call of the Chair.

Mr. President, in a little over 3 months, Americans will make a very important choice on the future direction of the country. We will go to the polls, we will select a new President. Americans will also vote on roughly one-third of the Senate and all the Members of the House of Representatives.

According to public opinion polls, economic issues will be among the most important matters voters will consider when they go to the voting booth in November.

Everybody knows that the Federal Government affects economic issues, and we do it through Federal fiscal policy. How we deal with Federal fiscal policy can be viewed as two sides of a ledger: On one side is tax policy, and on the other side is spending policy. The choices about how we as a nation want to balance each side of the ledger will have very important consequences and implications on our economic future.

Most economists agree that high taxes dampen economic growth. Too much spending, just like too much taxation, can also dampen economic growth. As elected representatives of the American people, we have an obligation, as the Constitution directs us, to spend those tax dollars for the common defense and also for the general welfare of the Nation. We all have a stake in a growing economy, and we will all suffer from a shrinking economy.

As ranking Republican on the tax-writing Senate Finance Committee, I believe it is my obligation to explain the choices and the consequences of those fiscal policy choices; therefore, I wish to focus on tax policy as it relates to the choices Americans will face this fall.

In all of the discussion about vague notions of change and vague notions of hope, there are some substantive issues Americans will be facing in the fall. The big question will be how much is the Federal Government going to take out of the American taxpayers' pocketbooks. We will need to evaluate before the election what we are being told on the campaign trail--not just what we are told, compare it with what is likely to occur starting at high noon, January 20, 2009.

I think from history we have some pretty good indicators that tell us what will happen based upon the choices of the American people in the next election. To do that, we must look at our current tax burden. Then we need to take a look at what Senators McCain and Obama are telling us about how they will change the tax burden. Finally, we have to consider the ability of each candidate to deliver on promises. Each taxpayer is going to have to make choices, choices about what these candidates will do on tax issues once they get into that position of power. Every American taxpayer and every American family budget will be impacted by the new President and the agenda of the Congress. Elections have consequences.

Today, I wish to consider future tax policy and do it in the context of the Congressional Record over the last 3 decades.

First, I want to compare the actions of Congress on tax hikes and tax cuts in relation to each party's hold on the White House and do it from the congressional as well as the White House basis. As a baseline, I will show a scorecard of tax hikes and tax cuts for each 4-year Presidential term since 1981.

I have a chart here. The chart shows three things. They start, as I said, with the year 1981. As you will note, the years are divided into Presidential terms, so we start with President Reagan's first term and work our way through to the present, which is the last year of President George W. Bush's second term. You see the bottom lines across there, the ones that have red and blue, and the years there for the Presidential terms.

Right above the line for the Presidential terms, we have a thick line. It is a three-part line. The line shows relative power of Democrats and Republicans. The top third of the line, if red, shows Republicans holding the White House. The middle third of the line shows who held the Senate majority for a certain period. If red, then Republicans held the Senate; if blue, the Democrats held the Senate. Then the bottom line, that is in regard to the House majority. Like the other two lines, if red, it means the Republicans held the majority; if blue, it means Democrats were in charge of the other body.

If you move up the chart, there is a running total of how much on a yearly average that particular Congress and President agreed to raise or reduce taxes. The lines going up or down are in regard to the tax raises or tax decreases. This data is not mine; it was drawn from the Treasury Office of Tax Analysis report that was released--the most recent one in 2006. The amounts are derived from the nonpartisan Joint Committee on Taxation revenue estimates of each of the enacted bills Congress passed during that 26-year period of time.

Let's take a further look at the chart so you get some specifics.

President Reagan made tax relief a cornerstone of his successful 1980 campaign. His election helped Republicans attain a narrow majority for the first time in over a generation. The House, of course, remained in Democratic hands.

In 1981, President Reagan proposed and Congress agreed to a large tax cut. So you have it. The first green line goes there. On average, if fully implemented, it meant that you would have a tax cut of almost $111 billion per year. Over time, the Democratic House pushed for and President Reagan reluctantly agreed to some smaller tax increases, and they are the second line where the tax increases come down toward the zero line there.

For the 1984 campaign, President Reagan made revenue-neutral tax reform a central part of his campaign for reelection. Republicans held a majority in the Senate for that election, and President Reagan had built a case for reform. Republicans in the Senate and Democrats in the House agreed, and the chart reveals tax reform for 1986 of a small amount, as you can see there, but still tax reform. It is significant, I would say.

But in 1986, Republicans lost control of the Senate. I happen to remember that because I was on the Finance Committee for my first 6 years in the Senate. We didn't have enough Republican seats after that, I didn't have enough seniority, and so I lost my seat on the Finance Committee.

Congressional Democrats insisted on and obtained, after their success in that election, a tax increase in 1987. You can see that tax increase there for 1987.

In 1988, as you recall, President Bush's father, George H.W. Bush campaigned, in 1988, and included a pledge not to raise taxes. President George H.W. Bush won that election, but congressional Democrats solidified their majorities, and, as a part of a deficit- reduction package, President George H.W. Bush forgot about his campaign promise and agreed to a tax increase. And here it is. You can see the big tax increase--in 1989-1990, it was. Shortly after that tax increase went into effect--there are consequences of policy made here in Congress--the American economy went into recession that year.

Then you get to the 1992 campaign. Bill Clinton, in response to the recession, campaigned on a middle-income tax cut and tax increases on higher income taxpayers. President Clinton was elected, and Congress Democrats retained a very comfortable majority in the House and Senate, as you can see by the blue lines there, during those years.

In 1993, less than a year later, on the force of the Democratic votes alone, the largest tax increase of modern era was enacted. There you can see it very definitely, a big tax increase at that period of time. You will note it is at the highest point on the tax increase part of the chart.

Republicans claimed majorities in the House and Senate in the 1994 election.

President Clinton agreed to a revenue-neutral small business tax relief package in 1996. During that campaign, President Clinton campaigned once again on middle-income tax relief. President Clinton was reelected, Republicans increased their majority in the Senate, and we retained a majority in the House.

In 1997, congressional Republicans and President Clinton agreed to a significant tax relief package. It was the first tax relief law since the President Reagan administration, and it averaged about $13 billion a year. There you can see it in the year of 1997.

George W. Bush campaigned on a broad-based tax relief plan for 2000, or in the 2000 campaign. He was elected then, obviously. The parties split the Senate 50-50, with Republicans in control because of Vice President Cheney's tie-breaking vote for organization. Republicans held their House majority.

In 2001, President Bush and Congress agreed on the largest comprehensive tax relief package since President Reagan. Here it is, as you can see, the big tax reduction of 2001, averaging about $82 billion per year.

As things happen around here, I was chairman of that committee for only about 5 months because Senator Jeffords switched from being a Republican to a Democrat, and in the wake of 9/11, corporate scandals, and other events, President Bush, a Republican House, and a Democratic Senate agreed on an economic stimulus package that averaged about $12 billion a year.

Republicans regained the Senate majority in 2002. So in 2003, President Bush and the Republican Congress continued to significantly reduce the overall tax burden.

So here you can see in the 2003 and 2004 tax bills a combined about another $82 billion a year reduction in taxes. If you look at President George W. Bush's first term, enacted legislation totaled roughly $174 billion per year, on average. Republicans held the House for all of that term. Republicans held the Senate for most but not all of that term.

In 2004, President Bush campaigned for reelection by emphasizing the permanence of the lower tax burdens secured during his first term. Republicans increased their House and Senate majorities.

So in 2006, President Bush and the Republican Congress extended the tax relief in the first term through the year 2010. It is shown here. It averages about $22 billion per year. In 2006, the situation now, as a result of that election, Democrats gained majorities in both the House and Senate.

Despite the opposition of the Democratic leadership in the House and Senate, Congress passed and President Bush signed an ``unoffset'' alternative minimum tax. That legislation averaged $13 billion in tax relief.

This year Congress and the President agreed to $34 billion in temporary economic stimulus. At present, the Democratic Congress and President Bush are in a stalemate on an AMT patch extension and other expiring tax relief matters. The reason for the stalemate is the House and Senate Democratic leadership's opposition to passing these bills ``unoffset.''

I want to use one chart to sum up today's discussion. This chart shows a tax thermometer. We have got it up there. The heat side is the tax increase side. This chart shows the relationship between party control of Congress, Presidency, and tax hikes or tax relief.

If Republicans control the Presidency and Congress, then lowering the tax burden, which is a tentative Republican philosophy, is virtually certain to be put in place. So you can point to that point in the chart there that demonstrates having both a Republican President and a Republican Congress is a certainty to have a lower tax burden for the American people.

If Democrats control both the Presidency and the Congress, then an increase in the tax burden is certain to occur. That is what history of the last 25 years shows. So it is a virtual certainty, regardless of campaign rhetoric to the contrary.

If the parties split control of the Presidency and the Congress, the record is, as you might expect, mixed, though generally against tax relief.

So if you look at the median picture there, you see that we have about three decades of history backing this up. I would encourage everyone to take a look at this thermometer chart. When folks go to the voting booth on November 4, they will need to consider the probability of a change in fiscal policy. They will need to consider the potential change to their family budget, from higher or lower taxes, because elections have consequences. They will have to also think about the broader economic effects of higher or lower tax burdens on business or investment, because tax policies by the Congress of the United States do have consequences, some ways good, some ways bad. My view is, higher taxes are bad for the economy.

That change could be dramatic if the vote is for one party to control the House, the Senate, and the Presidency. There would be consequences then,

lower taxes if that is House and Senate Republicans, Republican President; House and Senate Democratic, Democratic President, higher taxes.

In my next discussion, which will not be today, I will follow up this one with a detailed examination of what happens in the last bit of history most like the present. I am referring to the 1992 campaign and the legislative record that followed in 1993.

The reason I do that is I think I see the same thing evolving in this campaign. We ought to learn from history, and the voters need to take that into consideration before November 4.

I yield the floor.

Mr. President, today I rise to express my opposition to the nomination of Mr. James A. Williams to be the Administrator of the General Services Administration, GSA. My concerns are based on my investigation of a dubious GSA contract with Sun Microsystems. In 2006 and 2007, my oversight staff conducted a thorough inquiry into the GSA Multiple Award Schedule contract with Sun Microsystems for computer products and services. GSA inspector general, IG, auditors had alerted GSA's top management of alleged fraud on this contract as early as 2005.

In 2006, Mr. Williams became the Commissioner of the GSA Federal Acquisition Service, FAS. His office was directly responsible for this questionable contract with Sun Microsystems. He and Administrator Doan were alterted to the alleged fraud and the referral of the matter to the Department of Justice, DOJ.

I previously made the findings of my inquiry known in a floor statement on October 17, 2007.

In a nutshell, all the evidence developed in my oversight investigation appears to indicate that top-level GSA management, including Administrator Doan and FAS Commissioner Williams, may have improperly interfered in the ongoing contract negotiations with Sun Microsystems in May-September 2006; and Administrator Doan and Mr. Williams pressured the GSA contracting officer to approve the new Sun contract even though they both knew that the IG had detected alleged fraud on the existing Sun contract and had

referred the matter to the DOJ for possible prosecution/litigation. This case is now pending in Federal court.

The facts appear to show Mr. Williams, as FAS Commissioner, failed to act in the best interest of the American taxpayer. He had the opportunity to put an end to or bring into compliance a contract that was allegedly fraudulent, but in the end he could not do it. Instead, he sided with former Administrator Doan by taking steps to remove the GSA contracting officer. When the final contract was signed with Sun Microsystems by a newly appointed contracting officer, he chose to look the other way. He didn't even try to have the IG audit or examine the terms of the proposed contract. At the very least, this was a very poor management decision by Mr. Williams. It was a deplorable error in judgment that he probably regrets today.

We need a strong leader at GSA. The responsibilities of GSA Administrator require an individual who will stand up to anyone to protect the financial interests of hard-working American taxpayers. Although I agree he is well qualified and a devoted civil servant, I don't believe Mr. Williams has the bureaucratic and intestinal fortitude to make the tough decisions at GSA when it matters.

Reports of alleged fraud on the Sun contract surfaced on his watch. He knew about the alleged fraud. The taxpayers may have been cheated out of tens of millions of dollars. As FAS Commissioner, he was the top GSA official responsible for making the tough calls, and he chose not to protect the taxpayers. He made the wrong choice. He is now accountable for that decision. Because he failed to protect the taxpayers at a crucial moment, we should not elevate Mr. Williams to high office.

For all these reasons, I oppose his nomination to be GSA Administrator.

Mr. Williams's nomination is now before the Homeland Security and Governmental Affairs Committee. On July 22, I wrote to the chairman, Senator Lieberman, laying out the reasons behind my opposition to this nomination.

I ask unanimous consent to have that letter printed in the Record.

Mr. President, I am pleased to join my colleague Senator Kerry today to introduce the Empowered at Home Act. This bill is a continuation of efforts that I undertook in 2005 to improve access to home and community based services for those needing long-term care. This is an important piece of legislation that continues our efforts to make cost-effective home and community based care options more available to those who need it.

In 2005, I introduced the Improving Long-term Care Choices Act with Senator Bayh. That legislation set forth a series of proposals aimed at improving the accessibility of long-term care insurance and promoting awareness about the protection that long-term care insurance can offer. It also sought to broaden the availability of the types of long-term care services such as home and community-based care, which many people prefer to institutional care.

The year 2005 ended up being a very important year for health policy as it relates to Americans who need extensive care. In the Deficit Reduction Act of 2005, Congress passed into law the Family Opportunity Act, the Money Follows the Person initiative, and many critical pieces of the Improving Long-term Care Choices Act. With the bill I am introducing today with Senator Kerry, I hope to set us on the path to completing the work we started in 2005.

Making our long-term care system more efficient is a critical goal as we consider the future of health care. There are more than 35 million Americans, roughly 12 percent of the U.S. population, over the age of 65. This number is expected to increase dramatically over the next few decades as the baby boomers age and life expectancy increases. According to the U.S. Administration on Aging, by the year 2030, there will be more than 70 million elderly persons in the United States. As the U.S. population ages, more and more Americans will require long- term care services.

The need for long-term care will also be affected by the number of individuals under the age of 65 who may require a lifetime of care. Currently, almost half of all Americans who need long-term care services are individuals with disabilities under the age of 65. This number includes over 5 million working-age adults and approximately 400,000 children.

Long-term care for elderly and disabled individuals, including care at home and in nursing homes, represents almost 40 percent of Medicaid expenditures. Contrary to general assumptions, it is Medicaid, not Medicare, that pays for the largest portion of long-term care for the elderly. Over 65 percent of Medicaid long-term care expenditures support elderly and disabled individuals in nursing facilities and institutions. Although most people who need long-term care prefer to remain at home, Medicaid spending for long-term care remains heavily weighted toward institutional care.

Section 6086 of the Deficit Reduction Act of 2005 (DRA, P.L. 109-171) was based on the Improving Long-term Care Choices Act. The DRA provision authorized a new optional benefit under Medicaid that allows States to extend home and community-based services to Medicaid beneficiaries under the section 1915(i) Home and Community-Based Services State Option. Under this authority, States can offer Medicaid- covered home and community-based services under a State's Medicaid plan without obtaining a section 1915(c) home and community-based waiver. Eligibility for these section 1915(i) services may be extended only to Medicaid beneficiaries already enrolled in the program whose income does not exceed 150 percent of the Federal poverty level.

To date, only one State, my own State of Iowa, has sought to take advantage of the provision authorized through the DRA. While we had hoped far more States would participate, we know that the relatively low income cap, 150 percent, in the DRA provision creates an administrative complexity that has not made the option appealing for States.

In this bill we are introducing today, the income eligibility standard would be raised for access to covered services under section 1915(i) to persons who qualify for Medicaid because their income does not exceed a specified level established by the State up to 300 percent of the maximum Supplemental Security Income, SSI, payment applicable to a person living at home. This will significantly increase the number of people eligible for these services. States will be able to align their institutional and home and community-based care income eligibility levels.

The bill would also establish two new optional eligibility pathways into Medicaid. These groups would be eligible for section 1915(i) home and community-based services as well as services offered under a State's broader Medicaid program. Under this bill, States with an approved 1915(k) State plan amendment would have the option to extend Medicaid eligibility to individuals: (1) who are not otherwise eligible for medical assistance; (2) whose income does not exceed 300 percent of the supplemental security income benefit rate; and (3) who would satisfy State-established needs-based criteria based upon a State's determination that the provision of home and community-based services would reasonably be expected to prevent, delay, or decrease the need for institutionalized care. Under this new eligibility pathway, States could choose to either limit Medicaid benefits to those home and community-based services offered under section 1915(k) or allow eligibles to access services available under a State's broader Medicaid program in addition to the 1915(k) benefits. These changes will give the States the option of exploring the use of an interventional use of home and community-based services. If States have the flexibility to provide the benefit as contemplated in the bill, they can try to delay the need for institutional care and people in their homes longer.

As the number of Americans reaching retirement age grows proportionally larger, ultimately the number of Americans needing more extensive care will grow. Many of those Americans will look to Medicaid for assistance. States need more tools to provide numerous options to people in need so that they can stay in their own homes as long as possible.

The cost of providing long-term care in an institutional setting is far more expensive care than providing care in the home. States will benefit from having options before them that allow them to keep people appropriately in home settings longer. The more States learn how to use those tools, the more states and ultimately the Federal taxpayer will benefit from reduced costs for institutional care.

I am also pleased that this bill will include key provisions from S. 2337, the Long-Term Care Affordability and Security Act of 2007. The bill includes important tax provisions that I introduced in previous Congresses as well--most recently, the Improving Long-term Care Choices Act of 2005, introduced in the 109 Congress.

Research shows that the elderly population will nearly double by 2030. By 2050, the population of those aged 85

and older will have grown by more than 300 percent. Research also shows that the average age at which individuals need long-term care services, such as home health care or a private room at a nursing home, is 75. Currently, the average annual cost for a private room at a nursing home is more than $75,000. This cost is expected to be in excess of $140,000 by 2030.

Based on these facts, we can see that our Nation needs to prepare its citizens for the challenges they may face in old age. One way to prepare for these challenges is by encouraging more Americans to obtain long-term care insurance coverage. To date, only 10 percent of seniors have long-term care insurance policies, and only 7 percent of all private-sector employees are offered long-term care insurance as a voluntary benefit.

Under current law, employees may pay for certain health-related benefits, which may include health insurance premiums, co-pays, and disability or life insurance, on a pre-tax basis under cafeteria plans and flexible spending arrangements, ``FSAs''. Essentially, an employee may elect to reduce his or her annual salary to pay for these benefits, and the employee doesn't pay taxes on the amounts used to pay these costs. Employees, however, are explicitly prohibited from paying for the cost of long-term care insurance coverage tax free.

Our bill would allow employers, for the first time, to offer qualified long-term care insurance to employees under FSAs and cafeteria plans. This means employees would be permitted to pay for qualified long-term care insurance premiums on a tax-free basis. This would make it easier for employees to purchase long-term care insurance, which many find unaffordable. This should also encourage younger individuals to purchase long-term care insurance. The younger the person is at the time the long-care insurance contract is purchased, the lower the insurance premium.

Our bill also allows an individual taxpayer to deduct the cost of their long-term care insurance policy. In other words, the individual can reduce their gross income by the premiums that they pay for a long- term care policy, and therefore, pay less in taxes. This tax benefit for long-term care insurance should encourage more individuals to purchase these policies. It certainly makes a policy more affordable, especially for younger individuals. This would allow a middle-aged taxpayer to start planning for the future now.

Finally, a provision that is included in our bill that I am really proud of is one that provides a tax credit to long-term caregivers. Long-term caregivers could include the taxpayer, him- or herself. Senator Kerry and I recognize that these taxpayers--who have long-term care needs, yet are taking care of themselves--should be provided extra assistance. Also, taxpayers taking care of a family member with long- term care needs would also be eligible for the tax credit. These taxpayers should be given a helping hand. As our population continues to age, the least that we can do is provide a tax benefit for these struggling individuals.

Mr. President, I am pleased to join my colleague Senator Kerry today to introduce the Empowered at Home Act. This bill is a continuation of efforts that I undertook in 2005 to improve access to home and community based services for those needing long-term care. This is an important piece of legislation that continues our efforts to make cost-effective home and community based care options more available to those who need it.

In 2005, I introduced the Improving Long-term Care Choices Act with Senator Bayh. That legislation set forth a series of proposals aimed at improving the accessibility of long-term care insurance and promoting awareness about the protection that long-term care insurance can offer. It also sought to broaden the availability of the types of long-term care services such as home and community-based care, which many people prefer to institutional care.

The year 2005 ended up being a very important year for health policy as it relates to Americans who need extensive care. In the Deficit Reduction Act of 2005, Congress passed into law the Family Opportunity Act, the Money Follows the Person initiative, and many critical pieces of the Improving Long-term Care Choices Act. With the bill I am introducing today with Senator Kerry, I hope to set us on the path to completing the work we started in 2005.

Making our long-term care system more efficient is a critical goal as we consider the future of health care. There are more than 35 million Americans, roughly 12 percent of the U.S. population, over the age of 65. This number is expected to increase dramatically over the next few decades as the baby boomers age and life expectancy increases. According to the U.S. Administration on Aging, by the year 2030, there will be more than 70 million elderly persons in the United States. As the U.S. population ages, more and more Americans will require long- term care services.

The need for long-term care will also be affected by the number of individuals under the age of 65 who may require a lifetime of care. Currently, almost half of all Americans who need long-term care services are individuals with disabilities under the age of 65. This number includes over 5 million working-age adults and approximately 400,000 children.

Long-term care for elderly and disabled individuals, including care at home and in nursing homes, represents almost 40 percent of Medicaid expenditures. Contrary to general assumptions, it is Medicaid, not Medicare, that pays for the largest portion of long-term care for the elderly. Over 65 percent of Medicaid long-term care expenditures support elderly and disabled individuals in nursing facilities and institutions. Although most people who need long-term care prefer to remain at home, Medicaid spending for long-term care remains heavily weighted toward institutional care.

Section 6086 of the Deficit Reduction Act of 2005 (DRA, P.L. 109-171) was based on the Improving Long-term Care Choices Act. The DRA provision authorized a new optional benefit under Medicaid that allows States to extend home and community-based services to Medicaid beneficiaries under the section 1915(i) Home and Community-Based Services State Option. Under this authority, States can offer Medicaid- covered home and community-based services under a State's Medicaid plan without obtaining a section 1915(c) home and community-based waiver. Eligibility for these section 1915(i) services may be extended only to Medicaid beneficiaries already enrolled in the program whose income does not exceed 150 percent of the Federal poverty level.

To date, only one State, my own State of Iowa, has sought to take advantage of the provision authorized through the DRA. While we had hoped far more States would participate, we know that the relatively low income cap, 150 percent, in the DRA provision creates an administrative complexity that has not made the option appealing for States.

In this bill we are introducing today, the income eligibility standard would be raised for access to covered services under section 1915(i) to persons who qualify for Medicaid because their income does not exceed a specified level established by the State up to 300 percent of the maximum Supplemental Security Income, SSI, payment applicable to a person living at home. This will significantly increase the number of people eligible for these services. States will be able to align their institutional and home and community-based care income eligibility levels.

The bill would also establish two new optional eligibility pathways into Medicaid. These groups would be eligible for section 1915(i) home and community-based services as well as services offered under a State's broader Medicaid program. Under this bill, States with an approved 1915(k) State plan amendment would have the option to extend Medicaid eligibility to individuals: (1) who are not otherwise eligible for medical assistance; (2) whose income does not exceed 300 percent of the supplemental security income benefit rate; and (3) who would satisfy State-established needs-based criteria based upon a State's determination that the provision of home and community-based services would reasonably be expected to prevent, delay, or decrease the need for institutionalized care. Under this new eligibility pathway, States could choose to either limit Medicaid benefits to those home and community-based services offered under section 1915(k) or allow eligibles to access services available under a State's broader Medicaid program in addition to the 1915(k) benefits. These changes will give the States the option of exploring the use of an interventional use of home and community-based services. If States have the flexibility to provide the benefit as contemplated in the bill, they can try to delay the need for institutional care and people in their homes longer.

As the number of Americans reaching retirement age grows proportionally larger, ultimately the number of Americans needing more extensive care will grow. Many of those Americans will look to Medicaid for assistance. States need more tools to provide numerous options to people in need so that they can stay in their own homes as long as possible.

The cost of providing long-term care in an institutional setting is far more expensive care than providing care in the home. States will benefit from having options before them that allow them to keep people appropriately in home settings longer. The more States learn how to use those tools, the more states and ultimately the Federal taxpayer will benefit from reduced costs for institutional care.

I am also pleased that this bill will include key provisions from S. 2337, the Long-Term Care Affordability and Security Act of 2007. The bill includes important tax provisions that I introduced in previous Congresses as well--most recently, the Improving Long-term Care Choices Act of 2005, introduced in the 109 Congress.

Research shows that the elderly population will nearly double by 2030. By 2050, the population of those aged 85

and older will have grown by more than 300 percent. Research also shows that the average age at which individuals need long-term care services, such as home health care or a private room at a nursing home, is 75. Currently, the average annual cost for a private room at a nursing home is more than $75,000. This cost is expected to be in excess of $140,000 by 2030.

Based on these facts, we can see that our Nation needs to prepare its citizens for the challenges they may face in old age. One way to prepare for these challenges is by encouraging more Americans to obtain long-term care insurance coverage. To date, only 10 percent of seniors have long-term care insurance policies, and only 7 percent of all private-sector employees are offered long-term care insurance as a voluntary benefit.

Under current law, employees may pay for certain health-related benefits, which may include health insurance premiums, co-pays, and disability or life insurance, on a pre-tax basis under cafeteria plans and flexible spending arrangements, ``FSAs''. Essentially, an employee may elect to reduce his or her annual salary to pay for these benefits, and the employee doesn't pay taxes on the amounts used to pay these costs. Employees, however, are explicitly prohibited from paying for the cost of long-term care insurance coverage tax free.

Our bill would allow employers, for the first time, to offer qualified long-term care insurance to employees under FSAs and cafeteria plans. This means employees would be permitted to pay for qualified long-term care insurance premiums on a tax-free basis. This would make it easier for employees to purchase long-term care insurance, which many find unaffordable. This should also encourage younger individuals to purchase long-term care insurance. The younger the person is at the time the long-care insurance contract is purchased, the lower the insurance premium.

Our bill also allows an individual taxpayer to deduct the cost of their long-term care insurance policy. In other words, the individual can reduce their gross income by the premiums that they pay for a long- term care policy, and therefore, pay less in taxes. This tax benefit for long-term care insurance should encourage more individuals to purchase these policies. It certainly makes a policy more affordable, especially for younger individuals. This would allow a middle-aged taxpayer to start planning for the future now.

Finally, a provision that is included in our bill that I am really proud of is one that provides a tax credit to long-term caregivers. Long-term caregivers could include the taxpayer, him- or herself. Senator Kerry and I recognize that these taxpayers--who have long-term care needs, yet are taking care of themselves--should be provided extra assistance. Also, taxpayers taking care of a family member with long- term care needs would also be eligible for the tax credit. These taxpayers should be given a helping hand. As our population continues to age, the least that we can do is provide a tax benefit for these struggling individuals.

Mr. President, I am pleased today to introduce the Medicare Physician Payment Equity Act of 2008.

I stood before this body last December as we agreed to a short-term Medicare extension bill so that we would have the opportunity to address other

pressing priorities in a bipartisan Medicare package this year. One of the most significant issues I had hoped to address was the need to provide more equitable payment for physicians in Iowa and other rural states.

While the Medicare bill that Congress just enacted improves the situation for physicians in the near-term by averting the SGR payment cuts scheduled to occur during the next 18 months, it does little to remedy the unjustifiable geographic disparities in physician payment that exist. It is unfortunate that reforms to the geographic physician payment adjusters were not included in H.R. 6331. I have long supported more equitable treatment of physicians in rural areas, and I have pressed for reforms to the work and practice expense geographic adjustments in the Medicare physician fee schedule. However, much- needed reforms such as the establishment of a practice expense floor are not in the Medicare bill that Congress enacted last week.

The legislation I am introducing today is designed to remedy this problem by providing more equitable treatment for physicians in rural areas. The bill reduces inequitable disparities in physician payment resulting from the Geographic Practice Cost Indices or adjusters, known as GPCls, by establishing a 1.0 floor for physician practice expense adjustments as of 2009 and by providing a national 1.0 geographic index for physician work expense after the expiration of the existing 1.0 floor in 2010.

Although geographic adjustments are intended to reflect actual cost differences in a given area compared to a national average of 1.0, the existing, inaccurate formulas create significant disparities in physician reimbursement that penalize, rather than equalize, physician payment in Iowa and other rural states. These geographic disparities lead to rural states experiencing significant difficulties in recruiting and retaining physicians and other health care professionals because of their significantly lower reimbursement rates. This in turn leads to reduced beneficiary access to rural health care providers.

Here is a simple example that demonstrates the inequity of the current GPCI formulas. Iowa is widely recognized as providing some of the highest quality health care in the country, yet Iowa physicians receive some of the lowest Medicare reimbursement of any physicians in the country because of inequitable geographic adjustments. Medicare physician payment is equal in all 89 Medicare payment localities until the geographic adjusters, or GPCls, are applied. After the GPCI adjustments, however, Medicare reimbursement for some physician services in Iowa is at least 30 percent lower than payment for the same service in other parts of the country, and it is fundamentally unfair. Congress needs to reduce these unwarranted payment variations and realign Medicare incentives to reward physicians' quality instead of their geography.

Sadly, the inequitable geographic formulas which make these adjustments have merely exacerbated the problems of rural access to health care. Rural America today has far fewer physicians per capita than urban areas do. According to the National Rural Health Association, only about 10 percent of physicians practice in rural areas although nearly a quarter of the U.S. population lives there. Another grave concern is the lack of specialists in rural areas: only about 40 specialists exist per 100,000 in rural areas compared to more than three times as many--134 per 100,000--in urban areas. The evidence is clear that the existing geographic adjusters have been a dismal failure in promoting an adequate number of physicians in Iowa and other rural states. More severe physician shortages will occur in the future if we do not make essential changes to these formulas now.

The Medicare Physician Payment Equity Act revises the formulas used to determine geographic work and practice expense adjustments. The physician work formula currently used by the Centers for Medicare and Medicaid Services to estimate physician wages measures geographic differences in the earnings of six categories of professionals (lawyers, engineers, and others), rather than differences in physicians' earnings. In addition, the data that are used are based on outdated proxy data from the 2000 census. This bill recognizes that physician work for a service requires the same skill and training regardless of the geographic area, and should be similarly valued, and it establishes a national index of 1.0 for physician work beginning in 2010.

The practice expense formula used by CMS is inaccurate, outdated, and does not represent the actual office rent or employee wage costs for physicians in many areas. The office rent component uses Department of Housing and Urban Development residential apartment rental data from 2000 which does not accurately reflect physician office rent. The employee wage component comes from 2000 census data on clerical workers, nurses, and medical technicians which does not take into account any of the more highly compensated workers such as physician assistants, office administrators, and other specialists employed in physician practices today. The Medicare Physician Payment Equity Act provides for a more appropriate recognition of the geographic differences in employee wages and office rents by reducing the impact of this index to reflect more accurately the differences in physician practice costs, as of 2010. We must act now to help recruit and retain rural physicians to ensure that beneficiaries in Iowa and other rural areas will continue to have access to health care.

I urge my colleagues to support this legislation to address the growing problem of health care shortages in rural America by providing more equitable payment for physicians.

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

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

Mr. President, I am pleased today to introduce the Medicare Physician Payment Equity Act of 2008.

I stood before this body last December as we agreed to a short-term Medicare extension bill so that we would have the opportunity to address other

pressing priorities in a bipartisan Medicare package this year. One of the most significant issues I had hoped to address was the need to provide more equitable payment for physicians in Iowa and other rural states.

While the Medicare bill that Congress just enacted improves the situation for physicians in the near-term by averting the SGR payment cuts scheduled to occur during the next 18 months, it does little to remedy the unjustifiable geographic disparities in physician payment that exist. It is unfortunate that reforms to the geographic physician payment adjusters were not included in H.R. 6331. I have long supported more equitable treatment of physicians in rural areas, and I have pressed for reforms to the work and practice expense geographic adjustments in the Medicare physician fee schedule. However, much- needed reforms such as the establishment of a practice expense floor are not in the Medicare bill that Congress enacted last week.

The legislation I am introducing today is designed to remedy this problem by providing more equitable treatment for physicians in rural areas. The bill reduces inequitable disparities in physician payment resulting from the Geographic Practice Cost Indices or adjusters, known as GPCls, by establishing a 1.0 floor for physician practice expense adjustments as of 2009 and by providing a national 1.0 geographic index for physician work expense after the expiration of the existing 1.0 floor in 2010.

Although geographic adjustments are intended to reflect actual cost differences in a given area compared to a national average of 1.0, the existing, inaccurate formulas create significant disparities in physician reimbursement that penalize, rather than equalize, physician payment in Iowa and other rural states. These geographic disparities lead to rural states experiencing significant difficulties in recruiting and retaining physicians and other health care professionals because of their significantly lower reimbursement rates. This in turn leads to reduced beneficiary access to rural health care providers.

Here is a simple example that demonstrates the inequity of the current GPCI formulas. Iowa is widely recognized as providing some of the highest quality health care in the country, yet Iowa physicians receive some of the lowest Medicare reimbursement of any physicians in the country because of inequitable geographic adjustments. Medicare physician payment is equal in all 89 Medicare payment localities until the geographic adjusters, or GPCls, are applied. After the GPCI adjustments, however, Medicare reimbursement for some physician services in Iowa is at least 30 percent lower than payment for the same service in other parts of the country, and it is fundamentally unfair. Congress needs to reduce these unwarranted payment variations and realign Medicare incentives to reward physicians' quality instead of their geography.

Sadly, the inequitable geographic formulas which make these adjustments have merely exacerbated the problems of rural access to health care. Rural America today has far fewer physicians per capita than urban areas do. According to the National Rural Health Association, only about 10 percent of physicians practice in rural areas although nearly a quarter of the U.S. population lives there. Another grave concern is the lack of specialists in rural areas: only about 40 specialists exist per 100,000 in rural areas compared to more than three times as many--134 per 100,000--in urban areas. The evidence is clear that the existing geographic adjusters have been a dismal failure in promoting an adequate number of physicians in Iowa and other rural states. More severe physician shortages will occur in the future if we do not make essential changes to these formulas now.

The Medicare Physician Payment Equity Act revises the formulas used to determine geographic work and practice expense adjustments. The physician work formula currently used by the Centers for Medicare and Medicaid Services to estimate physician wages measures geographic differences in the earnings of six categories of professionals (lawyers, engineers, and others), rather than differences in physicians' earnings. In addition, the data that are used are based on outdated proxy data from the 2000 census. This bill recognizes that physician work for a service requires the same skill and training regardless of the geographic area, and should be similarly valued, and it establishes a national index of 1.0 for physician work beginning in 2010.

The practice expense formula used by CMS is inaccurate, outdated, and does not represent the actual office rent or employee wage costs for physicians in many areas. The office rent component uses Department of Housing and Urban Development residential apartment rental data from 2000 which does not accurately reflect physician office rent. The employee wage component comes from 2000 census data on clerical workers, nurses, and medical technicians which does not take into account any of the more highly compensated workers such as physician assistants, office administrators, and other specialists employed in physician practices today. The Medicare Physician Payment Equity Act provides for a more appropriate recognition of the geographic differences in employee wages and office rents by reducing the impact of this index to reflect more accurately the differences in physician practice costs, as of 2010. We must act now to help recruit and retain rural physicians to ensure that beneficiaries in Iowa and other rural areas will continue to have access to health care.

I urge my colleagues to support this legislation to address the growing problem of health care shortages in rural America by providing more equitable payment for physicians.

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

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

Mr. President, I am pleased to introduce the Rural Hospital Act of 2008. Back in December, I stood before this body explaining that we were only passing a 6-month Medicare bill in order to provide the opportunity for us to address a number of priorities. One of the biggest priorities I identified was the need to ensure access to rural hospital services.

The type of rural hospitals that top the priority list are what are known as ``tweeners.'' These hospitals are too large to be critical access hospitals, but too small to be financially viable under the Medicare hospital prospective payment systems. It is absolutely imperative that these tweener hospitals get the assistance they need in order to keep their doors open. They are often not only the sole provider of health care in rural areas but are also significant employers and purchasers in the community. Also, the presence of a hospital is essential for purposes of economic development because businesses check to see if a hospital is in the community in which they might set up shop.

While the Medicare bill that Congress just enacted improves the situation for some tweeners, many more are left in financial peril. It is unfortunate that comprehensive payment reforms for tweener hospitals were not included in the bill that just passed. As you know, I have long proposed a number of tweener payment improvements in previous bills this Congress and they were included in the agreement that Senator Baucus and I reached for this year's Medicare bill. Unfortunately, the core tweener hospital payment improvements were dropped from the bill once the process became partisan.

It is for this reason that I am introducing this bill. We must improve the financial health of tweener hospitals and ensure that people have access to health care.

Most tweener hospitals are currently designated as Medicare Dependent Hospitals and Sole Community Hospitals under the Medicare program. While the bill that recently passed Congress improves payments for Sole Community Hospitals, there are no provisions that benefit Medicare Dependent Hospitals. This bill would benefit Medicare Dependent Hospitals by not adjusting their payments for area wages unless it would result in improved payments.

Also, a major driver of the financial difficulties that tweener hospitals face is the fact that many have relatively low volumes of inpatient admissions. Back when we passed the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, I made sure that this law included an add-on payment for low volume rural hospitals. This bill would improve the existing low-volume add-on payment for hospitals so that more rural facilities, both Medicare Dependent Hospitals and Sole Community Hospitals, with low volumes would receive the assistance they desperately need.

To offset the increases in spending from these tweener hospital payment improvements, this bill would address another priority that we wanted to include in a more comprehensive Medicare bill. Many know my position regarding physician owned hospitals and my concern about the effect these facilities have on health care access and costs as well as patient safety. There has been much debate regarding these facilities over the years, especially with physician owned limited service hospitals. This bill would eliminate the exceptions under the physician self-referral laws for physician-owned hospitals and provide a limited exception for existing facilities.

As you can see, we still have much to do when it comes to ensuring access to health care in rural America. I look forward to working with my colleagues on this urgent matter.

Mr. President, I am pleased to introduce the Rural Hospital Act of 2008. Back in December, I stood before this body explaining that we were only passing a 6-month Medicare bill in order to provide the opportunity for us to address a number of priorities. One of the biggest priorities I identified was the need to ensure access to rural hospital services.

The type of rural hospitals that top the priority list are what are known as ``tweeners.'' These hospitals are too large to be critical access hospitals, but too small to be financially viable under the Medicare hospital prospective payment systems. It is absolutely imperative that these tweener hospitals get the assistance they need in order to keep their doors open. They are often not only the sole provider of health care in rural areas but are also significant employers and purchasers in the community. Also, the presence of a hospital is essential for purposes of economic development because businesses check to see if a hospital is in the community in which they might set up shop.

While the Medicare bill that Congress just enacted improves the situation for some tweeners, many more are left in financial peril. It is unfortunate that comprehensive payment reforms for tweener hospitals were not included in the bill that just passed. As you know, I have long proposed a number of tweener payment improvements in previous bills this Congress and they were included in the agreement that Senator Baucus and I reached for this year's Medicare bill. Unfortunately, the core tweener hospital payment improvements were dropped from the bill once the process became partisan.

It is for this reason that I am introducing this bill. We must improve the financial health of tweener hospitals and ensure that people have access to health care.

Most tweener hospitals are currently designated as Medicare Dependent Hospitals and Sole Community Hospitals under the Medicare program. While the bill that recently passed Congress improves payments for Sole Community Hospitals, there are no provisions that benefit Medicare Dependent Hospitals. This bill would benefit Medicare Dependent Hospitals by not adjusting their payments for area wages unless it would result in improved payments.

Also, a major driver of the financial difficulties that tweener hospitals face is the fact that many have relatively low volumes of inpatient admissions. Back when we passed the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, I made sure that this law included an add-on payment for low volume rural hospitals. This bill would improve the existing low-volume add-on payment for hospitals so that more rural facilities, both Medicare Dependent Hospitals and Sole Community Hospitals, with low volumes would receive the assistance they desperately need.

To offset the increases in spending from these tweener hospital payment improvements, this bill would address another priority that we wanted to include in a more comprehensive Medicare bill. Many know my position regarding physician owned hospitals and my concern about the effect these facilities have on health care access and costs as well as patient safety. There has been much debate regarding these facilities over the years, especially with physician owned limited service hospitals. This bill would eliminate the exceptions under the physician self-referral laws for physician-owned hospitals and provide a limited exception for existing facilities.

As you can see, we still have much to do when it comes to ensuring access to health care in rural America. I look forward to working with my colleagues on this urgent matter.

Mr. President, I say to the Senator, he talked about judicial emergencies. I think it would be good if the public knew what a judicial emergency is and why it is so important that we emphasize getting those positions filled ahead of others and why there should be no excuse for holding them up, if you have any respect for the work of the judicial branch of Government.

Mr. President, if the Senator will yield further--and I only remember two names, but I think these two names would permit me to ask a question that I think is legitimate and that the public ought to take into consideration as to the holding up of those nominations--I remember the Senator mentioned a Peter Keisler, who has been waiting for 750 days, and Robert Conrad, who also has been waiting for a long period of time, 365 days. Now, obviously, if these nominations are not being processed, there must be people who think these individuals are incompetent and should not be nominated. So what are the accusations of incompetency for these individuals not being approved?

Well, if they are competent, shouldn't they be approved?

So I draw the conclusion, I say to the Senator from Pennsylvania, that the people blocking these nominations really are not concerned at all about the efficient operation of the judicial branch of Government. But we should get our job done and confirm these nominees because that is what it takes for the judicial branch to get their work done. The judiciary needs to have the personnel to get their job done.

Mr. President, I yield the floor.

Mr. President, I ask Senator Kyl, aren't there a lot of other well-qualified nominees being blocked as well?

How close are they to being confirmed?

I ask Senator Kyl, didn't Chairman Leahy and the other Democratic members of the Judiciary Committee say that a unanimous ``well qualified'' rating by the American Bar Association is somewhat of a ``gold standard'' by which all nominees should be judged?

Of course. Isn't he nominated to fill a seat deemed ``a judicial emergency'' by the nonpartisan Administrative Office of the Courts?

Yes. We have always had an understanding around here that if both Senators of the home State supported a nominee, they would move forward. Doesn't Judge Conrad satisfy this third prong of the ``Leahy standard'' for confirming judges since he has the strong support of both his home State Senators?

I believe it is also true, that Judge Conrad meets the fourth and final prong of Chairman Leahy's standard because he previously received bipartisan approval by the Judiciary Committee and the Senate when he was confirmed by a noncontroversial voice vote to be a U.S. Attorney in North Carolina and when he was confirmed by voice vote to the District Court for the Western District of North Carolina. It seems to me that these bipartisan voice votes indicate that Judge Conrad is a noncontroversial consensus nominee.

Well, I have had a chance to review that, and I can say that as you know, in May of 2000, during President Clinton's last year in office, Senator Leahy, referring to the Thurmond rule, said:

There is a myth that judges are not traditionally confirmed

in presidential election years. That is not true. Recall that

64 judges were confirmed in 1980, 44 in 1984, 42 in 1988 when

a Democratic majority in the Senate confirmed Reagan nominees

and, as I have noted, 66 in 1992 when a Democratic majority

in the Senate confirmed 66 Bush nominees.

That is the end of the Leahy quote in regard to the Thurmond rule.

Well, the answer is yes, of course. Let me explain that Senate Democrats allege that Republicans, then in the minority and anticipating a change in power in the 1980 election, stalled the approval of President Carter's judicial nominees. The Majority points to a discussion at an executive business meeting which took place on September 10, 1980, when Ranking Member Thurmond asked Chairman Kennedy to hold over 13 nominees for 1 week because their background investigations were not complete. However, this allegation is not accurate.

Yes, it is. In fact, a 1-week holdover in the Judiciary Committee is any Senator's prerogative--in fact, prerogatives I have used a few times myself--and over the last 2 years, the Majority has held over virtually all of President Bush's nominees for 1 week before a committee vote. Do you recall whether the Senate later confirmed any of these nominees who were held over?

I think it is pretty clear then, Senator Sessions, referring to the accusations made about Senator Thurmond, it doesn't sound to me as though Senator Thurmond was blocking nominees in anticipation of an upcoming election.

Let me also point to a nonpartisan source. Didn't Mr. Steve Rutkus from the Congressional Research Service testify at the Senate Republican Conference's forum on the judicial nomination process on Monday that the facts do not support a Thurmond rule? Would that be correct? Is that the way you understand it?

Yes. The record shows the Senate did. That is entirely true.

Yes. It doesn't sound to me like the conservative Senator from South Carolina was using any power he had on the Judiciary Committee to hold up a person who has turned out to be very much a judicial activist. I would say even more remarkable, in regard to your statement, after September 1, 1980, the Senate confirmed 11 district court nominees and 2

additional circuit court nominees, including Stephen Reinhardt, who has gone on to earn a reputation as one of the Nation's most liberal jurists. The other post-September circuit court confirmation was that of Stephen Breyer, who at that time was Senator Kennedy's chief counsel on the Judiciary Committee.

That is right. In fact, the Senate confirmed a total of 10 circuit court nominees and 53 district court nominees during 1980, President Carter's last year in office. And 1980 was not an aberration. As Senator Leahy noted in 2000, the pattern continued in subsequent election years. Also in 2000, the year Senator Leahy called the Thurmond rule a ``myth'' when he was complaining about the pace of judicial confirmations, the Senate confirmed 8 circuit court nominees and 31 district court nominees.

No. Go ahead.

Mr. President, the Smithsonian Institution is an important icon to many Americans. It houses treasures of our national history in its museums across the country. The Smithsonian Institution is not just a museum but also an educational institution and a research complex. It consists of 19 museums and galleries, 9 research facilities, and has 144 affiliated museums around the world. The Smithsonian manages this vast array of facilities and receives 70 percent of its funding directly from the federal government through congressional appropriations. There is no debate that the Smithsonian is an important part of our country.

However, over the last few years I have been critical of the management

of the Smithsonian Institution, beginning with story after story detailing the ``Champagne lifestyle'' the former Secretary of the Smithsonian enjoyed at institution expense. Through my oversight of the Smithsonian as a tax-exempt entity, and investigative reporting by the Washington Post, other egregious examples have emerged. These revelations have detailed the Smithsonian's management failures and lax accountability over the spending of millions of institution dollars.

The former secretary spent millions of institution dollars on the redecoration of his office, housing allowances, and household expenses including chandelier cleaning and a new heater pump for his lap pool. He and his wife enjoyed first-class plane travel and top hotels.

Ultimately, Secretary Small resigned on March 26, 2007.

The deputy secretary and chief operating officer of the Smithsonian Institution, announced her resignation on June 18, 2007, after earning more than $1.2 million in 6 years for outside duties, including highly compensated seats on corporate boards, and that she and other top executives were frequently absent from their Smithsonian duties.

An independent management report released in June 2007 concluded that Smithsonian leaders took extraordinary measures to keep secret top executives' compensation, expense-account spending, ethical missteps, and management failures.

In August 2007, the Smithsonian replaced Gary M. Beer as chief executive of Smithsonian Business Ventures after an inspector general's report found he had abused his institution-issued credit card and billed thousands of dollars in expenditures that were unauthorized or lacked evidence of a business purpose.

In December 2007, W. Richard West, Jr., who was the founding director of the National Museum of the American Indian, retired after disclosures that he spent extensive time away from the museum and spent more than $250,000 in 4 years on trips to places including Paris, Venice, Singapore, and Indonesia.

In February 2008, Pilar O'Leary, the head of the Smithsonian Latino Center, resigned after an internal investigation found that she violated a variety of rules and ethics policies by abusing her expense account, trying to steer a contract to a friend and soliciting free tickets for fashion shows, concerts, and music award ceremonies. Ultimately, the Smithsonian Inspector General concluded that there were 14 violations of ethical and conflict of interest policies. The public did not learn of the reason for her resignation until April 15, 2008, when the Washington Post published a story after requesting under the Freedom of Information Act and ultimately receiving a heavily redacted copy of the Smithsonian Inspector General's report on Ms. O'Leary.

When Ms. O'Leary's resignation was announced to Smithsonian staff, the Smithsonian's official e-mail did not mention ethical lapses and in fact praised her work.

Only upon the specter of public disclosure did the Smithsonian's acting secretary say in a second e-mail to staff that O'Leary had ``engaged in behavior that violated our Standards of Conduct and other Smithsonian policies between August 2005 and September 2007.''

The acting secretary at the time said such reports from the Inspector General were not always public, but Smithsonian officials determined O'Leary ``held a position of such significant responsibility and public visibility that disclosure . . . was warranted.''

This raises a series of disturbing questions. What if a Post reporter had not somehow learned of the O'Leary report and formally asked the Smithsonian for a copy? Would the circumstances of Ms. O'Leary's resignation ever have seen the light of day? Once the report was released in a redacted form, was it appropriately redacted or was it redacted beyond what is reasonable to protect the privacy of third parties? Does the Smithsonian withhold other potentially embarrassing reports? If the individual had not been the head of a Smithsonian agency, and had a lower stature, would the report ever have been disclosed in any form?

If the past is prologue, probably not. The Smithsonian points out that it is not subject to the Freedom of Information Act, FOIA.

Many people would naturally think that the Smithsonian is subject to FOIA and must comply with requests. I know that I believed it was, especially given that taxpayer funds make up 70 percent of its budget. However, because the creation of the Smithsonian was different than the creation of other Federal Government agencies, there is an open question as to what open government and good governance statutes apply to the Smithsonian. For example, the Smithsonian's own website states, ``The Smithsonian Institution is not an executive branch agency and is not required by statute to provide documents to the public.'' However, the Smithsonian does state that it is guided by ``internal policy, and by FOIA and other relevant law'' when providing documents to the public. What this highly technical answer means is that the Smithsonian doesn't believe it is required to respond under FOIA but it will as long as its interests are in line with the release.

The legal status of the Smithsonian is also an open question with the prevailing law finding that for purposes of the Privacy Act and FOIA, the Smithsonian is not a government ``agency'' subject to the requirements. Instead, the Smithsonian calls itself a ``trust instrumentality of the United States.'' However, the Smithsonian takes a different position when it is faced with a lawsuit filed under the Federal Tort Claims Act and considers itself a ``federal agency.'' Taken together, these decisions have given the Smithsonian the best of both worlds--they are a government entity when information is sought that could embarrass them, but when they are sued, they get all the defenses of a government entity.

In light of the oversight findings and the many scandals that have raised questions about accountability and mismanagement at the Smithsonian, I'm introducing the Open and Transparent Smithsonian Act of 2008. This bill simply states that for the purposes of FOIA, the Privacy Act, and the Federal Advisory Committee Act, the Smithsonian shall be considered a Federal Government agency. This is a simple, straightforward way to bring transparency and accountability to the Smithsonian without expending additional Federal resources. This is especially important given that the Smithsonian received continual increases in congressional appropriations from fiscal years 1999-2008, now totaling $682 million in taxpayer dollars for fiscal year 2008.

On July 1, Wayne Clough took over as only the 12th secretary in Smithsonian history. He comes at a critical juncture. Will the Smithsonian recover from a series of scandals and regain its sterling reputation? Or will it backslide into bad old habits that could lead to more scandals?

The new secretary deserves the best possible chance to succeed. One of the best tools Congress can give him is a clear, definitive statement through legislative action that the Freedom of Information Act does indeed apply to the Institution, and that the Smithsonian's business is the people's business.

In addition to adding the Smithsonian to FOIA and Privacy Act, section 3 of this bill includes another important transparency fix to the Privacy Act. Currently, the Privacy Act provides that disclosure of information by a government agency is limited unless an enumerated exception applies. One of the most widely used exceptions allows for the disclosure of information to ``either House of Congress, or, to the extent of matter within its jurisdiction, any committee or subcommittee thereof.'' However, the Department of Justice has interpreted this to only allow for disclosures to chairmen of committees, excluding information from ranking minority members.

In a December 2001 letter opinion, the Department of Justice concluded, ``the Privacy Act prohibits the disclosure of Privacy Act- protected information to the ranking minority member.'' The rationale for this decision was that longstanding executive branch practice on this question shows that ``ranking minority members are not authorized to make committee requests.'' This opinion clearly looks past the plain language of the statute that says that the exception applies to ``either House

of Congress or to the extent of matter within its jurisdiction, any committee or subcommittee thereof.'' This interpretation clearly bypasses the inclusion of the word ``or'' and instead reads that Congress only intended it to apply to committee chairman. Conveniently, this opinion has been repeatedly used to block information requested from ranking members.

Section 3 of the bill corrects this erroneous interpretation by clearly adding in that chairman and ranking members may qualify for the exception under the Privacy Act. This provision is consistent with the intent of the Privacy Act exception and the goals of making the government more transparent and accountable under good governance statutes.

This bill is a simple, straightforward effort to make our Federal Government more accountable to the American taxpayers. Further, it will help ensure that Congress has the necessary access to documents from the executive branch so it can conduct its constitutionally required duty of oversight. I am pleased that Senator Specter has joined as an original cosponsor and urge my colleagues to support swift passage of this important legislation.