Floor Statements

Mr. President, I rise today to honor an heroic American who has fallen while serving his country in Operation Enduring Freedom in Afghanistan. First Sergeant Tobias Meister died December 28, 2005, when a bomb was detonated near his humvee just south of Asadabad, Afghanistan. First Sergeant Meister was part of the Sand Springs based 486th Civil Affairs Battalion and was assigned to the Army Reserve's 321st Civil Affairs Brigade based in San Antonio, TX. My deepest sympathies go out to his wife Alicia, his 1 year old son Will, his parents David and Judy, his brother and many more family and friends.

First Sergeant Meister was born in Kingsley, IA and graduated from Remsen-Union High School in 1994. He was employed by Horizon Natural Resources, an oil and gas firm, after he had successfully completed a business administration degree with a concentration in international business from the University of Texas at San Antonio.

Tobias Meister joined the Iowa National Guard in 1992 and served as an infantryman before transferring to the U.S. Army Reserve in 1998. He was named Drill Sergeant of the Year in 2002, the award for the Nation's top Army Reserve drill sergeant. He will be remembered for his patriotism, his love for his country and his fellow soldiers. As written by comrades on his website, he had ``so much passion for what he was doing, so much patriotism it was a privilege and an honor to work with him.'' I urge all of my colleagues here and all Americans to extend their prayers to the family of a truly heroic American, First Sergeant Tobias Meister.

Mr. President, I was saddened to learn of the sudden passing of Forest City Chief of Police Douglas ``Doug'' Book on January 13. Doug leaves behind a remarkable career in law enforcement that spans over three decades. He has had an immense impact not only in his community of Forest City but throughout the entire State of Iowa.

Doug Book began his career as a full-time patrolman in 1968 and quickly rose amongst the ranks of his department until he was appointed chief of police in 1973. He served faithfully in this capacity until his passing. In addition to his dedicated service to his community, Doug also served Iowa as the head of the North Central Iowa Narcotics Task Force for the past 10 years. Doug also served as chairman of the Iowa Law Enforcement Academy Board and as president of the Iowa Association of Chiefs of Police and Peace Officers.

Doug's constant support and guidance for his fellow officers did not stop at Iowa's borders but spilled over to other departments in New York City. Chief Book joined a group of Iowa police officers as part of a critical incident stress management team that helped New York City police officers cope with the aftermath of the September 11 terrorist attacks.

One of Doug's colleagues described him simply as a ``good guy, a good cop, and a good friend.'' His friends and family should be very proud of what he has done for so many people. Chief Book's devotion, hard work, and dedication to duty will be sorely missed.

I thank the Senator from Missouri. Yes, I want to clarify the intent is not to create an additional liability where none exists today. Pharmacy benefit managers mayor may not be liable third parties. It is dependent upon whether they are ultimately responsible for the payment of a claim. It is my understanding that the health plan or employer contracting with the pharmacy benefit manager is ultimately at risk for the underlying claim, so it is my belief this will not create new liability for the pharmacy benefit manager.

The Senator from Mississippi is correct. It was not the intent of the conferees to suggest that by dropping bona fide services fees from the final agreement that those service fees should be included in the calculation of the Medicaid Average Manufacturer Price, AMP, based reimbursement methodology as established in the pharmacy reimbursement provisions of the conference agreement.

I thank my colleague from Mississippi for seeking this clarification.

continued dumping Subsidy offset act

I thank you, Senator Baucus for raising the issue. Providing relief from the alternative minimum tax for millions of American families is critically important. The alternative minimum tax is badly in need of reform and I know he is anxious to work with me on that important task. Until such time, we must provide annual relief to prevent further expansion of that tax's reach. I was proud that we were able to accomplish that objective as part of the tax reconciliation bill that passed the Finance Committee and the Senate at the end of November. I remain committed to seeing that AMT relief enacted into law. In addition, we should act quickly on other expiring tax provisions to provide simplification and certainty for individuals and businesses, alike.

Mr. President, I yield myself such time as I may consume but not more than 30 minutes.

Mr. President, before I comment on the Senate Committee on Finance portion of the Deficit Reduction Act, I will go over some ground that has been covered by other Members on our side of the aisle through this chart or similar charts, to point out how three entitlement programs--Social Security, Medicare, and Medicaid--as a percentage of the gross domestic product are going to continue to grow and grow and grow until reaching a point where it squeezes out almost everything else in the Federal budget.

This is already legislated. The red on the chart, if we do nothing, is where we end up.

This bill is doing something about that problem. But we ought to be doing a lot more.

I start out by saying what we are doing in this entire deficit reduction package is reducing expenditures of the Federal Government over the next 5 years. Five years is the length of the budget reconciliation changes that we are making. During that 5-year period of time, the Federal Government will spend about $12.5 trillion. We are cutting out of that $12.5 trillion, a 5-year figure, about $10 billion as shown in the red part of the chart.

The reason I try to put that in perspective, one-quarter of 1 percent is at $40 billion, compared to the $12.5 trillion. That is a spit in the ocean compared to what the problem is.

I point out two things. We will hear from Members of this Senate, mostly from the other side of the aisle, that it is catastrophic we are making changes to one-quarter of 1 percent in all the money the Federal Government is going to spend over the next 5 years. It is catastrophic. The world is coming to an end, we will hear.

Then, from the other point of view, considering what these problems are that we know we face today--and no Republican or Democrat disagrees with that--for what we are doing we ought to be somewhat ashamed we cannot do more than one-quarter of 1 percent of all the money the Federal Government is going to spend in the next 5 years.

For the average American who votes and thinks that Washington, DC, is on some other land from the standpoint of what we do in the Congress, they would say to both sides of the argument that the world is coming to an end, that we are going to eliminate or reduce one-quarter of 1 percent or to those that are bragging--I will be in that category of bragging--about doing something about one-quarter of 1 percent, they are going to say, you guys have to be crazy if you cannot find in all the money that the Federal Government spends, some way of saving more than one-quarter of 1 percent of the $12.5 trillion that will be spent over the next 5 years. They would probably say you ought to go out and find some other work where you can accomplish something.

Those are the extreme points of view. That is what I think the public is probably going to say to us at our town meetings when we go back home if we are going to brag about this, or maybe to the people that are going to complain about it, asking if we are really doing much. It is similar to all the labor that an elephant will go through to give birth and then give birth to a mouse. That is what we have here, a mouse compared to the elephant of a problem.

I take an opportunity to explain what is in the Senate Committee on Finance portion of this bill. Senator Gregg needs to be complimented for getting us where we are today on this conference agreement. What I described, one-quarter of 1 percent of all money over the next 5 years, $12.5 trillion worth, this is the first time we have gone through this process in almost 10 years.

So we do not do this every year. And the public watching would say: Why don't you do it every year? I wish I had a responsible answer for that. But I think we ought to recognize Senator Gregg's involvement and the involvement of all the chairmen of the committees in putting together, over several months, this budget reconciliation package for spending to achieve this goal, and achieving this goal regardless of how small it might be.

It is important for the reason I have given you, that by all accounts, the growth in entitlement spending has monumental implications for our Nation's economic and financial strength.

The chart I just spoke about shows the Congressional Budget Office's projections for mandatory spending, including Social Security, Medicare, and Medicaid. According to this chart, by 2050 mandatory spending will approach 30 percent of the Nation's gross domestic product. That is 30 percent by 2050. This would push Federal spending well above the levels that it has been throughout much of the post- World War II period, as evidenced by that straight line that goes across that chart.

This might be, hopefully, a worst case scenario, but it is a plausible scenario. The agreement that we are going to be voting on, called the budget reconciliation package, begins to get at this situation--the red on this chart--by achieving nearly $40 billion in savings over the next 5 years. That includes $6.4 billion in net Medicare savings and $4.7 billion in net Medicaid savings.

I actually hesitate to mention those amounts because for many of our constituents it is hard to get past the numbers. To them, any reduction--any reduction--even if it is only one-fourth of 1 percent, is a bad reduction. But the policy--and we ought to be making decisions in this body based upon sound

policy--the policy behind these reductions is sound, just as the policy behind the numerous spending provisions in this entire package is sound.

Throughout this process I have sought to reduce wasteful spending, eliminate loopholes, and pay providers more accurately. I have sought to advance policies that will ensure the availability of important health care and social services, to update these programs to reflect our Nation's changing needs, and also to promote the delivery of high- quality health care services.

The agreement makes some important improvements in the Medicare Program, not the least of which is addressing a scheduled reduction in payments to physicians, which could have led to access problems for beneficiaries. The agreement builds on progress made 3 years ago that linked increases in Medicare payments to hospitals to the reporting of quality data.

I actually would have preferred to do more in the area of pay for performance, and I will continue to push further for changes because we just cannot sit back on this issue, as the private sector is moving much faster than Government, particularly the major corporations of America, in making sure they do their health care business with people in the health care profession and institutions in the health care profession that are going to deliver quality care. We have to be more concerned about this than we have in the past in the Federal Government.

Medicare is the single largest payer of health care in the Nation. Taxpayers and beneficiaries deserve to get the highest value for every Medicare dollar spent. Unfortunately, there is no question that today we are not getting the most value for the taxpayer dollar.

The bill also takes steps to ensure access to quality care in rural communities. It does this by reinstating special payment programs, such as a 5-percent add-on for rural home health providers, the Medicare dependent hospital program, and the hold-harmless payments for small rural hospitals.

The conference agreement also includes coverage of valuable preventive benefits not covered by Medicare. These preventive benefits are important to prevent illnesses and to keep beneficiaries healthy.

This bill also saves beneficiaries and Medicare money by changing the payment structure for durable medical equipment.

Now Medicare will only pay for DME services that are needed; that is, after we get this passed.

I would like to look at Medicaid changes.

In our efforts to reform the Medicaid Program, we take some very important steps, many of them recommended by a bipartisan group of our Nation's Governors. Eventually, all 50 Governors made suggestions to us in a unanimous agreement.

Let's just look at long-term care. In the very near future, a lot of older people are going to need long-term care. Right now, Medicaid is a primary payer for long-term care services. The Deficit Reduction Act expands the Long-Term Care Partnership Program and will promote awareness about long-term care insurance.

We combine that with a policy to tighten restrictions on seniors' ability to transfer or hide assets with the intention of qualifying for Medicaid. These policies protect the integrity of Medicaid and create an incentive for seniors to explore new long-term care options.

The agreement will ensure accurate payments to pharmacies for the cost of drugs, and it has little effect on the market.

We give States the ability to offer Medicaid beneficiaries coverage more consistent with coverage typically offered by employers, while at the same time guaranteeing that children do not lose any benefits currently provided under Medicaid.

We include protections for preventive services and treatment for children. This bill continues to require States which cover early, periodic, screening, diagnosis, and treatment services to continue to do that. The language of the bill is very clear.

Mr. President, on that very point, I ask unanimous consent to have printed in the Record a statement by Dr. McClellan, Administrator of CMS, supporting our interpretation of the provisions.

We also include policies that give States the option of asking for a limited set of Medicaid beneficiaries to share in the cost of their care.

The cost-sharing policy excludes anyone under the Federal poverty level, mandatory children, adoption or foster care children, preventative care and immunizations for all children, pregnancy-related services, hospice residents, and women who qualify for Medicaid under the breast and cervical cancer eligibility group.

It is a reasonable, responsible policy that I encourage my colleagues to support. These are all modifications of what the House of Representatives did in their provisions in this area.

These are important, measured first steps that our Governors, in this communication to the Congress to which I previously referred, have asked for, on a bipartisan basis, to reform the Medicaid Program.

Now, the Medicaid Program is a Federal-State program. It is a big cost to the Governors. If we have Governors, 50 of them, of both political parties, coming to us and saying: We can tell you how to spend your taxpayers' dollars more wisely, and we will save some money at the State level, and we will be able to serve more people--they came to us and said that to us. And this document responds to that.

I don't know how 100 Senators can put their judgment--just in case they disagree with what we are trying to do. I suppose if they agree, this doesn't apply to them. I don't know how those Senators who disagree with what we are doing on a Federal-State program can put their judgment above that of 50 Governors who are almost equally divided between Republicans and Democrats.

This bill also dramatically increases funding to protect Medicaid from fraud and abuse. It does so by creating a Medicaid integrity program that mirrors a similar program already in place in the sister program of Medicare.

The agreement incorporates the Family Opportunity Act. This is a major improvement in Medicaid. This is a program that Senator Kennedy and I have been working on for 7 years. These provisions will help families meet the needs of their children with disabilities. Right now, these parents,

if they have a child with disabilities, face difficult decisions. I can document this among my own constituents in Iowa, that time and time again, many parents of disabled children tell me of their struggles getting health care for their children with costly special needs.

Many parents have been effectively forced to quit their jobs, to take low-paying jobs so this child with costly medical care can qualify for Medicaid. Why? Because the services their child needs are not available with private health insurance. So they need the assistance of Medicaid.

This policy we presently have in place and in the Family Opportunity Act turns by 180 degrees; it is totally backward.

This agreement allows States to give these parents in this situation the option to buy into Medicaid while continuing to work and probably in most cases continuing to pay taxes. These are folks who want to work and can work, and we should not have a disincentive to productive employment in America just because some family has a child with special very expensive health needs.

Moving on, the agreement also fills shortfalls in funding of their State children's health insurance programs that States would have experienced just next year.

We also include $2 billion to assist Louisiana, Alabama, and Mississippi, as well as other States to meet health care needs of people whose lives were devastated by Katrina. It extends TANF Programs with a few minor improvements. It closes several loopholes in TANF and in child support, while providing funding for childcare, child welfare, and allowing more child support to go directly to families.

For nearly 4 years, I have tried to reauthorize TANF in the regular order. Without any help from Democrats, I reported a bill out of the last Congress on a partisan basis. That year, Senator Frist devoted a week for the consideration of welfare. The first floor amendment offered on behalf of Senator Snowe would have increased childcare spending by $6 billion--I voted for it--bringing the total childcare money to $7 billion. That passed with 78 votes. Unfortunately, even with that victory which they won, Democrats blocked it.

I kept trying, and this year I worked out a bipartisan bill with Senator Baucus that the committee reported out on a voice vote. But again, efforts to reauthorize welfare in regular order have stalled. If we don't pass the Deficit Reduction Act, we will have to extend TANF for a 12th time. That is an unconscionable way to legislate. States cannot continue operating their welfare programs unsure of what the next reauthorization will bring.

Advocates complain that the $1 billion is not enough childcare money. But I say to them, where were you over the past year when there was $6 billion on the table and I was committed to bringing that $6 billion out of conference or we would not have had a conference report on TANF?

There has never been enough childcare money to satisfy those on the far left--$5.5 billion wasn't enough; $7 billion wasn't enough. I don't even know if $20 billion would have been enough. The fact remains that there hasn't been an increase in childcare for 4 years, and if we persist in passing extension after extension, there won't be any new childcare money at all.

As I said in the beginning, it is difficult for many folks to get beyond the numbers. But as I laid out here, this agreement includes many provisions to provide services that better meet people's needs, and it does so by getting rid of waste and abuse in the programs.

These are dollars that right now we are simply throwing away. They get taxpayers and beneficiaries nothing. Without some changes, these important programs of Medicare, Medicaid, and TANF will be driven into the ground. That some folks don't support these changes--well, to me, I believe they cannot see the forest for the trees.

The agreement before us includes sound policies. It achieves savings by reducing wasteful spending, closing loopholes, and taking steps to pay providers more accurately. It improves oversight of Medicaid to crack down on fraud and wasteful spending. It establishes policies to help families and beneficiaries and to ensure long-term viability of these programs. I urge my colleagues to support it.

I yield the floor and reserve the remainder of the time for Senator Gregg.

Mr. President, this is correct.

I agree that CMS needs to develop a process to permit medically necessary Part B therapy services that exceed the cap in a timely manner. I also believe that this process should not result in the delay of needed therapy services. I would hope that CMS would provide an outline as to how they envision the exceptions process to work so that beneficiaries needing therapy services beyond the $1,740 caps receive the therapy they need if medically necessary.

Mr. President, I would like to explain my action today related to S. 1057, a bill to amend the Indian Health Care Improvement Act. I requested that Leader Frist inform me prior to entering into any unanimous consent agreement relating to any amendments, motions, or any other actions relating to consideration of this bill.

This legislation exempts American Indians/Alaskan Natives from being charged a deductible, copayment, or coinsurance for an item or service for which payment may be made under the Medicaid or SCHIP programs in the Social Security Act. I am reluctant to treat one group differently from other groups. In my opinion, this is a precedent setting change. If we start by exempting one group from costsharing, then many other groups may start asking for the same exemption.

This legislation also exempts several types of property from being considered in Medicaid eligibility. We understand that there may be special circumstances that may necessitate the need for these provisions. We have requested additional information from the Indian Affairs Committee to facilitate our understanding of these exemptions. However, we have not yet received the requested information. In my opinion, without further information, these provisions send the message that resources are irrelevant to a determination of Medicaid eligibility. I don't believe that individuals should have significant resources and still be eligible for Medicaid. These provisions would create an imbalance by allowing a loophole solely for one group.

I want to be clear: it is not that I am concerned about making these changes for American Indians/Alaskan Natives, I am concerned about making these changes for any group. I welcome the opportunity to continue to work with the sponsors of this legislation, Senators McCain and Dorgan, and with members of the Indian Affairs Committee on this matter. My staff has been working with staff from the Indian Affairs Committee, but they have not yet resolved my concerns.

I ask unanimous consent the following Senate Committee on Finance interns and fellows be granted floor privileges during the consideration of the conference report to accompany S. 1932, the Deficit Reduction Act: Melissa Atkinson, Brad Behan, and Amber Mackenzie.

I thank the Senator for his careful explanation of the law. I agree completely that the intent of the Finance Committee in including the limitation of section 664(g)(7) was to provide for an orderly and fair transfer of stock received in a gratuitous transfer and that we intended the value of the stock to be determined upon allocation to the participant's account and not upon some earlier date.

Mr. President, I wish to submit for the record the Joint Committee's technical explanation of the Gulf Opportunity Zone Act of 2005. This explanation is of the Senate amendment to H.R. 4440. This legislation was passed by the Senate on Friday, December 16, 2005. Let me make it clear that this technical explanation was actually submitted to the Senate at the time the bill was passed to be printed in the Congressional Record. Unfortunately, due to a clerical error this did not happen. Therefore, I ask unanimous consent that the technical explanation be printed in the Record.

Mr. President, this amendment 2680 acts on our commitment to provide rebuilding assistance to areas of the country devastated by this year's relentless hurricane season. It will benefit residents of the gulf region, as well as more recently impacted areas of Texas and Florida, and provides much needed relief and resources for economic rebuilding to those areas.

As promised, we have made our best effort to marry up our compassion for displaced persons and damaged communities with attention to fiscal discipline and the best use of taxpayer dollars. This bill represents an effort to most efficiently and effectively use the tax code to assist in the rebuilding and revitalization of those regions. I will reiterate the guiding principles of our hurricane relief legislation. First, because market forces will be the driver in getting these regions back on their feet, our bill includes only provisions that encourage and incentivize redevelopment. Second, our package provides resources only to those who incurred uninsured losses and does not provide for a bailout of those who assumed risk as an insurer in our capitalist, free-market system. Third, we have focused our limited Federal resources on those most in need--like the many devastated small business employers who were the backbones of these economies and who will be the engines of their future growth and prosperity. The amendment provides front-loaded incentives on a timely basis to encourage people and businesses to return to the region as quickly as possible.

I want to show my appreciation to my colleagues in the Senate and in the House for working to get this legislation to the President as quickly as possible. Before we go home to spend time with our families, it is important for us to help the many families who have had their lives overturned by the recent hurricanes. Hopefully they will think of this holiday season as a time of rebuilding and opportunity.

The amendment also includes tax technical correction provisions related to the American Jobs Creation Act of 2004 and other tax legislation. Technical corrections measures are routine for major tax acts and are necessary to ensure that the provisions of the acts are working consistently with their original intent, or to provide clerical corrections. Because these measures carry out congressional intent, no revenue gain or loss is scored from them.

The process and test for technical corrections ensures that only provisions narrowly drawn to carry out Congressional intent are included. Technical corrections are derived from a deliberative and consultative process among the congressional and administration tax staffs. That means the Republican and Democratic staffs of the House Ways and Means and Senate Finance Committees are involved as is the Treasury department staff. All of this work is performed with the participation and guidance of the nonpartisan Joint Committee on Taxation staff. A technical enters the list only if all staffs agree it is appropriate.

The Senate Finance Committee and the Committee on Ways and Means, in consultation with the Joint Committee on Taxation and the Department of the Treasury, are continuing to assess proposals for other technical corrections which may be needed to achieve congressional intent. On that point, no double benefit is intended under the railroad track maintenance credit of code section 45G. If the current basis adjustment rule is not serving to carry out that intent, the provision may need to be clarified. Such a clarification might provide that basis or tax attribute reduction applies to the taxpayer taking the credit. I would like to ask the staff to work on this.

In conclusion, this package will show those affected by Hurricanes Rita, Wilma, and Katrina that their needs have not been forgotten, and that we will continue to help them rebuild their homes, communities, and lives.

I thank the Senator for that clarification. His description is correct.

employee retention credit--tax-exempt financing

I agree with Senator Lott's interpretation of this provision of the bill.

I agree with Senator Lott's interpretation of this provision of the bill.

I share concern with the impact that Katrina will have on the ability of low wage working families who qualify for the child tax credit and the earned income tax credit to receive them for the 2005 tax year. In addition, I certainly agree that something must be done to address this problem for families who generously gave of themselves and took in a child displaced by Katrina but may lack the proper formal authorization that would prevent them from receiving the EITC they qualify for and would otherwise get.

To help address this problem, I would urge the IRS to accept a child placement decision by an authorized agency as being retroactive to the earliest point in 2006 when the taxpayer first took in the child. This would apply only to children who had resided in a hurricane disaster zone in 2005 as defined under HKTRA and under any subsequent legislation extending HKTRA provisions to Rita and Wilma survivors.

I have been advised that the IRS has the ability to adopt this approach under section 407 of HKTRA and any equivalent extension to Rita and Wilma survivors--that enables the Secretary to make adjustments in application of rules to ensure that hurricane survivors do not lose tax benefits. I know my colleague from Montana joins me in urging the IRS to use this authority to help these foster care families who so generously took in children displaced by Katrina.

I agree that many eligible hard-working families who qualify for the EITC and the child tax credit but whose lives have been sharply affected by the hurricane may face particular challenges and hurdles in applying for and receiving these credits. I also concur that is incumbent upon the IRS to take all steps it can to ensure that the public and the tax preparation community have clear, detailed, and understandable information about any adjustments and modifications it makes to help Katrina victims who qualify for the credits get them.

I believe that the IRS should report to Congress within the next couple of weeks the action it has taken to implement the provisions of section 406 and section 407 HKTRA, pertaining to the EITC and CTC, including outreach and communication efforts undertaken by IRS to inform taxpayers, tax practitioners, and volunteer tax preparation programs of these provisions, including the guidance provided to them by IRS on how the flexible authority to IRS in section 407 is being interpreted and implemented. IRS should publish such guidance, including typical questions and answers, in formats that are accessible to taxpayers, commercial tax practitioners, volunteer tax preparer organizations and low-income taxpayer clinics, including but not limited to the IRS Web site.

Mr. President, I rise today for the purpose of honoring a fallen American. I learned this week that AW2 John N. Kaye III, from Traer, IA, died while in service to his country during counter narcotics operations off the coast of Colombia. I would like to take this opportunity to salute his patriotism and his sacrifice.

We can often tell a lot about the character of an individual by how they help the people around them. Petty Officer Kaye was a man who would willingly extend a helping hand to those around him and this week even extended his mission to help out a fellow sailor. Just before leaving the Navy, though, he extended his stay aboard the USS DeWert for one final mission so that another sailor could be with his family to mourn the loss of a brother. Sadly, Petty Officer Kaye gave his life in service to his country on Tuesday off the coast of Colombia.

John Kaye was looking forward the completion of his tour of duty in the Navy so that he could return to Iowa to be near family and friends and attend college. He was from a large family in central Iowa and attended North Tama High School where he played football. In his free time, he loved to hunt and fish or just spend time with his friends in the Traer area. In the Navy, he was one of the youngest people to ever graduate from the Search and Rescue Program where he received training as a rescue swimmer.

The primary mission for members of our military is to protect American citizens from outside threats. For John Kaye, the threat was drugs being grown and processed in South America, and he was actively involved in our effort to reduce the flow of illegal drugs into the United States. The Navy is an important partner in our efforts to track down and apprehend drug traffickers in the Pacific Ocean and the Caribbean Sea, and John Kaye deserves the highest gratitude of this body and the entire Nation. His sacrifice reminds us that freedom is so precious because of its incredibly high cost. This is an example of the patriotic contribution made by thousands of American service members and their families. The love of country and dedication to service shared by so many of its citizens is the great strength of our Nation, and we can all be very proud of patriots like John Kaye.

Mr. President, I rise to re-introduce the Fair Contracts for Growers Act of 2005. This bill would simply give farmers a choice of venues to resolve disputes associated with agricultural contracts. This legislation would not prohibit arbitration. Instead, it would ensure that the decision to arbitrate is truly voluntary and that the rights and remedies provided for by our judicial system are not waived under coercion.

I certainly recognize that arbitration has tremendous benefits. It can often be less costly than other dispute settlement means. It can also remove some of the workload from our Nation's overburdened court system. For these reasons, arbitration must be an option--but it should not be a coerced option.

Mandatory arbitration clauses are used in a growing number of agricultural contracts between individual farmers and processors. These provisions limit a farmer's ability to resolve a dispute with the company, even when a violation of Federal or State law is suspected. Rather than having the option to pursue a claim in court, disputes are required to go through an arbitration process that puts the farmer at a severe disadvantage. Such disputes often involve instances of discrimination, fraud, or negligent misrepresentation. The effect of these violations for the individual farmer can be bankruptcy and financial ruin, and mandatory arbitration clauses make it impossible for farmers to seek redress in court.

When a farmer chooses arbitration, the farmer is waving rights to access to the courts and the constitutional right to a jury trial. Certain standardized court rules are also waived, such as the right to discovery. This is important because the farmer must prove his case, the company has the relevant information, and the farmer can not prevail unless he can compel disclosure of relevant information.

Examples of farmers' concerns that have gone unaddressed due to limitations on dispute resolution options include; mis-weighed animals, bad feed cases, wrongful termination of contracts, diseased swine or birds provided by the company, fraud and misrepresentation to induce a grower to enter a contract, and retaliation by companies against farmers who join producer associations.

During consideration of the Farm Bill, the Senate passed, by a vote of 64-31, the Feingold-Grassley amendment

to give farmers a choice of venues to resolve disputes associated with agricultural contracts.

I have some letters supporting this legislation and ask unanimous consent that they be printed in the Record.

I also ask unanimous consent that the text of bill be printed in the Record.

Mr. President, I rise to re-introduce the Fair Contracts for Growers Act of 2005. This bill would simply give farmers a choice of venues to resolve disputes associated with agricultural contracts. This legislation would not prohibit arbitration. Instead, it would ensure that the decision to arbitrate is truly voluntary and that the rights and remedies provided for by our judicial system are not waived under coercion.

I certainly recognize that arbitration has tremendous benefits. It can often be less costly than other dispute settlement means. It can also remove some of the workload from our Nation's overburdened court system. For these reasons, arbitration must be an option--but it should not be a coerced option.

Mandatory arbitration clauses are used in a growing number of agricultural contracts between individual farmers and processors. These provisions limit a farmer's ability to resolve a dispute with the company, even when a violation of Federal or State law is suspected. Rather than having the option to pursue a claim in court, disputes are required to go through an arbitration process that puts the farmer at a severe disadvantage. Such disputes often involve instances of discrimination, fraud, or negligent misrepresentation. The effect of these violations for the individual farmer can be bankruptcy and financial ruin, and mandatory arbitration clauses make it impossible for farmers to seek redress in court.

When a farmer chooses arbitration, the farmer is waving rights to access to the courts and the constitutional right to a jury trial. Certain standardized court rules are also waived, such as the right to discovery. This is important because the farmer must prove his case, the company has the relevant information, and the farmer can not prevail unless he can compel disclosure of relevant information.

Examples of farmers' concerns that have gone unaddressed due to limitations on dispute resolution options include; mis-weighed animals, bad feed cases, wrongful termination of contracts, diseased swine or birds provided by the company, fraud and misrepresentation to induce a grower to enter a contract, and retaliation by companies against farmers who join producer associations.

During consideration of the Farm Bill, the Senate passed, by a vote of 64-31, the Feingold-Grassley amendment

to give farmers a choice of venues to resolve disputes associated with agricultural contracts.

I have some letters supporting this legislation and ask unanimous consent that they be printed in the Record.

I also ask unanimous consent that the text of bill be printed in the Record.

Mr. President, over the past several years the Congress has worked hand-in-hand with the administration to foster greater peace and stability in the Middle East through trade. We have concluded and implemented free trade agreements with Israel, Jordan, and Morocco. We recently concluded negotiations with Oman and negotiations are ongoing with United Arab Emirates. Perhaps soon, we will launch negotiations with our good friend and ally, Egypt.

Yesterday, with the passage of S. 2027, the U.S.-Bahrain Free Trade Agreement Implementation Act, we took another historic step forward. Once this agreement enters into force, 98 percent of our agricultural exports to Bahrain will enter duty-free and 100 percent of our two-way trade in industrial and consumer products will be duty-free. The agreement sets a new standard on services, with broad commitments by Bahrain to open their service sector to our exports.

Passage of the U.S.-Bahrain FTA will help advance the President's goal of achieving a Middle East Free Trade Area, MEFTA, by 2013. This visionary agenda is a key element in our efforts to help foster economic growth and prosperity in an important region of the world. It also reflects keen appreciation by the Bush administration of the 9/11 Commission Report recommendation that ``a comprehensive U.S. strategy to counter terrorism should include economic policies to encourage development, more open societies, and opportunities for people to improve the lives of their families and to enhance prospects for their children's future.''

I am pleased that we are able to take another step toward fulfilling this recommendation with passage of the Bahrain agreement. This would not have been possible without the hard work and dedication of many people. I first want to recognize Ambassador Robert Zoellick. As the former U.S. Trade Representative, Ambassador Zoellick spearheaded our trade agenda, including initiation of negotiations with Bahrain. This year, Ambassador Portman took up the reigns as our U.S. Trade Representative. Ambassador Portman has proven to be an able and effective negotiator who faithfully works with Congress to achieve the best result for America in our trade agreements. Ambassador Portman was assisted by Catherine Novelli, before her departure, as well as her replacement, Ambassador Shaun Donnelly, both serving in their capacity as Assistant U.S. Trade Representatives for Europe and the Mediterranean.

With the passage of this agreement, the Finance Committee continues its tradition of bipartisanship on trade. I appreciate the efforts of my ranking member, Senator Max Baucus, in helping remove any impediments to getting this done. An agreement such as this one also would not have been possible without the professionalism and work ethic of Senator Baucus' staff. In this regard, I owe thanks to Russ Sullivan, Democratic staff director, and Bill Dauster, deputy staff director, for their steadfast dedication to the Committee. Brian Pomper, chief international trade counsel to Senator Baucus, also deserves special thanks for his efforts as do Shara Aranoff, Demetrios Marantis, Anya Landau, Janis Lazda, and Chelsea Thomas.

I also want to recognize the work of my Finance Committee staff. At the top of the list is Kolan Davis, my chief counsel and staff director. Kolan has been a valuable asset to this committee, lending his counsel and expertise to moving countless bills, including the Bahrain agreement. Everett Eissenstat, chief international trade counsel to the committee, has played an important part in seeing that this agreement is timely implemented. I appreciate his continued dedication to advancing our trade agenda.

Everett manages a strong team of dedicated staff who consistently pull together to achieve our trade agenda. David Johanson, Stephen Schaefer, and Tiffany McCullen Atwell provide valuable support to the team. Their hard work and long hours are much appreciated. I also want to recognize Claudia Bridgeford, international trade policy assistant, and Russell Ugone, who is on detail to my staff from the Bureau of Customs and Border Protection in the Department of Homeland Security. Both Claudia and Russ have contributed a great deal to the work of this committee.

I would be remiss if I did not take this time to thank Mike Smythers, Special Assistant to the President for Senate Affairs from the White House Office of Legislative Affairs. I also want to thank Matt Niemeyer, Counselor and Assistant U.S. Trade Representative for Congressional Affairs. Matt will soon be leaving the Office of the U.S. Trade Representative. Throughout his tenure, he has been a valuable ally in passage of much of our trade agenda. I appreciate his hard work and service to the American people.

Matt was assisted by David ``Andy'' Olson, who provided critical support in moving this agreement. Jonathon Kallmer from the Office of General Counsel at the Office of the U.S. Trade Representative, also played a key role in working with Congress to ensure faithful implementation of the agreement. I appreciate both of their efforts. Finally, I want to take this opportunity to thank Polly Craghill senior counsel in the Senate's Office of Legislative Counsel, for her role in passing this agreement. Polly never falters in her efforts to provide timely technical expertise to this committee and her work is much appreciated.

This is a good day for the United States and Bahrain. I hope President Bush will soon sign this bill and that we will see quick implementation of this historic agreement.

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

Mr. President, I do want to, as I have the privilege of so often doing, express my thanks to my Democratic colleague, the ranking member of the Senate Finance Committee, for his cooperation particularly on this United States-Bahrain Free Trade Agreement that we were able to unanimously report out of our committee. The reason I want to emphasize ``unanimous'' isn't just to be complimentary to Senator Baucus but also to the people of this country who think that everything done in this Congress is always so partisan, that Republicans and Democrats never get along, that we never talk to each other, that we never agree on anything. I can see why they have that impression because that is the impression the news media of America gives about the Congress of the United States. But as practical matter, nothing gets done in the Senate that isn't somewhat bipartisan, and particularly there is quite a tradition of bipartisanship in our Senate Committee on Finance.

This recent bill that is before us, the United States-Bahrain Free Trade Agreement, is the latest representation of that bipartisan cooperation.

I thank Senator Baucus very much.

I give strong support to the bill S. 2027; that is, the United States-Bahrain Free Trade Agreement Implementation Act.

This legislation is not only good for our U.S. economy, but it is also going to promote free trade, which is an economic issue as it creates jobs, but it also promotes democracy, and it promotes economic stability.

In regard to economic stability, the reason I emphasize that is because the Middle East is seen as an area of the world that is not very stable. I think that enhancing trade with those countries, large or small, is going to bring great economic stability which in turn ought to bring some political stability.

On top of all this, it is going to cement our ties with this small kingdom of Bahrain. That country is a very strong ally of the United States in that region.

This trade agreement is a clear win for our economy. It will create jobs.

Upon entry into force of this agreement, Bahrain will immediately eliminate 100 percent of its duties on imports of U.S. consumer and industrial products.

U.S. farmers will also benefit. On day one of the agreement, Bahrain will grant duty-free access on 98 percent of its tariff lines that apply to U.S. agricultural as well as food products. Duties with respect to that small remaining 2 percent will be phased out over a period of 10 years.

This is solid market access for U.S. farmers and U.S. manufacturers.

U.S. service providers will also gain from this agreement.

Bahrain will provide substantial market access across its entire service regime. The service provisions of the agreement are based upon a ``negative list'' approach, which means that all service sectors are covered. In other words, there will be trade in all service sectors unless they are specifically excluded as a result of the list.

Bahrain is already a major center for service providers in the Middle East, and the government recognizes that its service sector can become even stronger through economic liberalization. Because of this agreement, as the region develops, there is going to be very enhanced opportunities for U.S. exporters.

While it is important to note how the United States-Bahrain Free Trade Agreement will benefit the economy of the United States in the aggregate, it is even more important to point out how it will benefit individual U.S. companies and their workers.

For me, I didn't have to look very far to find Iowa workers and Iowa companies that benefit from this agreement.

For example, the HNI Corporation--it used to be referred to as the HON Corporation--the Fortune 500 company in my State, this company in Muscatine, IA, looks forward to the implementation of this trade agreement. HNI is the second largest manufacturer of office furniture in North America. It is specifically targeting the Bahraini market for increased sales. So HNI employees in Iowa as well as other States will benefit from Senate passage of the agreement.

Workers at the Lennox residential heating and cooling products factory in Marshalltown, IA, also stand to gain from the agreement. Lennox has a strong interest in increasing its sales in Bahrain. Like HNI, Lennox has a presence in many States, so its employees not only in Iowa but throughout the country will benefit from the implementation of this agreement.

Smaller businesses throughout the United States also stand to benefit from this trade agreement. One such company is Midamar Corporation located in Cedar Rapids. The Midamar

Corporation supplies halal food and food service equipment to restaurants, hotels, and distributors throughout the world. This company was started in 1972 by Cedar Rapids native Bill Aossey. When Bill returned to Iowa after serving in the Peace Corps and traveling throughout the Middle East, he came up with the idea of starting a company dedicated to exporting Iowa products. Now, 33 years later, Bill has a lot to show for this hard work. He employs 30 Iowans and the Midamar Corporation is very much a clear success.

I visited the Midamar facility last August and I can report Bill Aossey and his employees are very enthusiastic about this prospect of a trade agreement with Bahrain being implemented so they can even do more business in the Middle East.

Aside from the immediate benefits to United States exporters to Bahrain, this agreement's impact will extend beyond Bahrain. The United States is promoting trade liberalization and economic growth in other countries in the Middle East and this agreement will serve as the template for other trade agreements being negotiated in the region. The solid gains for U.S. farmers, workers, manufacturers, and service providers found in this agreement may be replicated in other free trade agreements of their region.

This has already happened with the country of Oman. The United States recently concluded a free trade agreement with Oman that was based largely upon our agreement with Bahrain so the benefits to HNI Corporation, Lennox, and Midamar that I have identified will be multiplied as other Arab countries adopt free trade agreements with the United States that are based largely upon the Bahrain agreement.

This is all part of a broader goal and that was expressed in May 2000 by President Bush proposing a plan of graduated steps for Middle Eastern nations to increase trade and investment with the United States and others in the world economy, culminating with the establishment of the Middle East Free Trade Agreement by the year 2013. The importance of this vision of President Bush was brought home on July 22, 2004, when the report of the 9/11 Commission was released. That report contains as one of its key recommendations that ``comprehensive United States strategy to counterterrorism should include economic policies that encourage development, more open societies and opportunities for people who improve the lives of their families and to enhance the prospect of their children's future.''

Our trade agreement with Bahrain is an important achievement in that area and joins previously concluded bilateral trade agreements between the United States and Israel, Jordan, and Morocco. The agreement with Bahrain is an important part of a broader effort to encourage development, more open societies, and opportunities for people to improve the lives of their families and to enhance prospects for their children's future throughout the Middle East.

Finally, I urge my colleagues to support this bill before the Senate implementing the United States-Bahrain Free Trade Agreement.

Mr. President, I also take this opportunity to speak on a motion to instruct conferees on the Byrd amendment.

Yesterday, a Senator sent a letter to the majority leader saying he would oppose the reconciliation bill if we used repeal of the Continued Dumping and Subsidy Offset Act to achieve billions in budget savings. While disappointed, I was not surprised. In fact, I say, join the club.

Already, one Senator told me he would oppose reconciliation unless specific provisions on specialty hospitals were not included. Several other Senators threatened to vote against the reconciliation bill unless the MLLC Program was not extended. Another Senator told me he will vote no if we save money by trimming waste from the Medicaid Program. A group of southern Senators said they would vote no on the reconciliation bill if the Grassley provision on payment limits in the farm program became a part of the bill.

So, no savings from the CDSOA repeal; no savings from the MLLC Program; no savings from Medicaid; no savings from payment limits. With everyone threatening to vote ``no'' there will be no savings in any Federal program, ever.

Everyone says they are for balanced budgets as long as it is someone else whose budget is cut to get the job done--not their pet issue. We need to ask ourselves whether we want to trim the Federal budget or not. If not, what does the Republican Party stand for?

The most egregious threat has to be over budget savings from the repeal of the Continued Dumping and Subsidy

Offset Act. This program is Government pork at its worst. It takes money that should go to the treasury of the United States and it transfers that money to a select group of companies. Talk about special interests, Mr. President. Plus there are very few limits on what these companies can do with the money that is raised by an act of Congress.

According to the General Accounting Office, one recipient even used the money to pay off his home mortgage. The program is so bad it did not even pass during the light of day a few years ago. Instead, it was pushed into a conference report before it could receive scrutiny by either House of Congress. Ironically, some are arguing that budget reconciliation shouldn't be used to save money by repealing this amendment. They argue it should go through the regular order. I don't know why they would argue this given the provision never went through regular order before it became law in the first place.

Here, unlike passage a few years ago of this bad amendment, repeal went through regular order in the House. Repeal just a couple weeks ago went through regular order in the House where that amendment had never even been considered by the other body when it was originally adopted a few years ago.

So let me be clear. We are not talking about repealing any aspect of our trade remedy laws. Every trade protection that has been in place for years stays in place. What we are talking about is getting rid of a Government subsidy program that enriches the few at the expense of the many.

A recent report from the Government Accountability Office shows this in very stark detail. Over $1 billion has been distributed so far under this program. One company alone--one company alone--of that $1 billion received almost 20 percent of the disbursements, and the top 5 recipients account for almost half of those disbursements.

You do not have to cast a very wide net to see where this corporate welfare is going. Just 39 companies account for over 80 percent of the disbursements. And the World Trade Organization has authorized a number of our trading partners to retaliate against us. This is where, to help a few companies through this amendment, we are going to end up hurting a lot of American producers, some of them in our powerful agriculture, and maybe end up hurting every consumer in America. As a result, innocent U.S. exporters are taking a big hit so the lucky few can continue guzzling at the public trough.

Already, our exporters face additional duties imposed by Japan, Canada, Mexico, and the European Union. Here is where it affects some products. Our producers of live swine, fish, oysters, cigarettes, dairy products, wine, paper products, clothing, sweet corn, industrial belts, steel products, forklift trucks, printing machines, and others, are all bearing the brunt of sanctions against some American companies because we have a law on the books that violates our international agreement and at the same time benefits a handful of major companies in America.

It happens that Brazil, Chile, India, and South Korea could soon impose sanctions. As more countries exercise their authority to retaliate and as payments under this program continue to grow, innocent U.S. exporters--the ones I have listed and others--and, more importantly, their employees, will continue to be hurt more and more as time goes on. That is not right. This situation needs to end.

The Government Accountability Office report points out some other ridiculous aspects of this program, such as the complete lack of accountability. Recipients of funds under the program submit claims based upon qualifying expenditures, but there is no way to tell whether those claims are even justified. In fact, the evidence suggests they may not be justified.

In 2004, company claims were about $1.3 trillion. Mr. President, I said that right: Companies were making claims for $1.3 trillion. The gross domestic product of the United States in 2004 was $11.75 trillion. So if the 770 recipients of funds under the Continued Dumping and Subsidy Offset Act, referred to as the Byrd amendment, are to be believed, they spent about 11 percent of the U.S. gross domestic product last year on qualifying expenditures.

I understand that in the year 2005--the year now ending--claims are about $3.2 trillion. That is equivalent to one-quarter of the GDP of the entire United States of America.

I think those figures show the magnitude of the incentive for fraud under this program. The proponents of this program ought to be embarrassed. This program is bad economic policy, bad trade policy, and bad Government to use the power of Government to end up giving a few companies in this country the benefit of the Federal Government's power to tax.

It should be repealed, as the House has done. I hope that coming out of conference we can have this provision in there. I hope we will not instruct conferees to disagree with the House. In the process of doing this, we are going to put $3.2 trillion into the Federal Treasury instead of having it go as corporate welfare to a handful of companies.

If we cannot repeal such a blatant example of Government pork to save money during a time of skyrocketing budget deficits, then why are we here as representatives of the people at all? Are we here to protect the pockets of a select few, or do we want to do, and will do, what is in the best interests of our Nation?

Mr. President, I yield the floor.