Floor Statements

Mr. President, as a cosponsor of the Senate bill, I am pleased the Senate is considering the Fannie Lou Hamer, Rosa Parks, and Coretta Scott King Voting Rights Reauthorization and Amendments Act,

Mr. President, today, on behalf of the Greek Cypriot population of Rhode Island, and Greek Cypriots around the world, I recognize the 32nd anniversary of the Turkish invasion of Cyprus.

Shortly before dawn 32 years ago today, heavily armed Turkish troops landed on the northern coast of Cyprus launching the invasion and subsequent occupation of Northern Cyprus. Over the next 2 months, over 200,000 Greek Cypriots, an overwhelming 82 percent of the island's population, were forced to seek refuge in the southern Greek controlled portions of Cyprus. Turkey eventually called a ceasefire after seizing 37 percent of the island. To this day Turkey is the only country that recognizes the self-declared ``Turkish Republic of Northern Cyprus.''

Over the last 30 years, the United Nations Security Council and General Assembly have striven to resolve this ongoing territorial dispute through multiple failed peace talks and resolutions. While many years and much thought has gone into determining an equally agreeable solution, talks between the Greek Cypriot south and the Turkish Cypriot north constantly end in a stalemate.

However, hope was renewed this month when the United Nations began drafting recommendations on reviving stalled peace talks between this war-divided island's Greek and Turkish Cypriot communities. Furthermore, Cyprus President Tassos Papadopoulos and Turkish Cypriot leader Mehmet Ali Talat were hailed by the Cyprus Parliament Speaker Demetris Christofias as taking positive steps toward restarting the Cyprus peace talks.

We must applaud the continued efforts of the United Nations and the renewed focus of the Cypriot leaders to reunite a divided Cyprus and remain committed to ushering the settlement process forward. Cypriot, Mediterranean, and U.S. interests will benefit from a settlement that addresses all legitimate concerns of both sides and promotes the stability of a hostile region.

Much like the Greek proverb, ``learn to walk before you run,'' Cypriot leaders must take small steady steps forward and continue forward even when the road looks unpaved. There is a path that leads to the reunification and peace between these two communities. Traversing this path, however, will take patience and tolerance.

Mr. President, I thank my colleagues for including this provision in the Water Resources Development Act. More than 100 abandoned camels litter Narragansett Bay, creating a safety hazard for boaters and divers and contaminating the bay's water with creosote, which has been listed by the Environmental Protection Agency as a probable human carcinogen. Camels were commonly used as fendering systems at the Newport Navy Base, the Quonset Point Naval Air Station carrier pier, Davisville Naval Construction Battalion Center, and the Melville Fuel Depot. As my colleagues from Virginia and Oklahoma pointed out, this

language claries that funding from the formerly used Defense sites' account could be used to remove abandoned marine camels located in the waters of formerly used Defense sites in Narragansett Bay, including removal of debris that is linked to a formerly used Defense site even if that debris has drifted off land and into the water. The ecological health and water quality of Narragansett Bay is vital to the economy of Rhode Island, and I believe that this language will aid in the cleanup of this precious natural resource.

Aquatic Nuisance Species

Mr. President, I believe I have 5 minutes under the order.

Mr. President, I yield myself 5 minutes.

I wish to take a few moments talking about H.R. 810, the Stem Cell Research Enhancement Act. Last year, the House overwhelmingly passed this bill, and I am pleased that the Senate will now finally consider this legislation. My colleague in the other body, Congressman Jim Langevin, has been a staunch advocate for stem cell research and has played a central role in advancing this legislation through the House of Representatives, and I commend him for that.

I hope to be able to stand on the Senate floor a few years from now to highlight the advancements that have been made in the treatment of spinal cord victims, children with diabetes, and Parkinson's treatment because of embryonic stem cell research. However, I fear that even if the Senate approves legislation, patients will only see further delays in promising stem cell research.

The President endorsed the use of Federal funds research on existing cell lines in his August 2001 Executive Order. At the time of the announcement, he said:

Scientists believe further research using stem cells offers

great promise that could help improve the lives of those who

suffer from many terrible diseases--from juvenile diabetes to

Alzheimer's, from Parkinson's to spinal cord injuries. And

while scientists admit they are not yet certain, they believe

stem cells derived from embryos have unique potential.

This is from the President's Executive Order.

We know now that the stem cell lines identified in the Executive Order were not the panacea for breakthrough medical research. There are only 22 stem cell lines available for federally funded research, and since they were derived in the absence of scientific and ethical guidelines, they have proven unsuitable for most research. At the same time, there are approximately 400,000 frozen embryos in IVF clinics that will likely be destroyed. While I recognize the many benefits of using embryonic stem cells in biomedical research, I also realize that many serious ethical and moral issues have to be considered. I believe Federal guidelines designed to create and uphold strict oversight of these practices can achieve the appropriate balance needed in order to ensure that this research is being carried out in an acceptable manner.

H.R. 810 sets forth responsible rules and limitations for obtaining excess embryos as well as adequate standards for conducting research involving embryonic stem cells. It would establish the necessary framework for oversight so that principled research can finally be allowed to proceed.

Some of my colleagues believe embryonic stem cell research is not necessary, given some of the tremendous advances adult stem cells have yielded. Indeed, I wholeheartedly support continued progress in the area of adult stem cell research and was proud to be one of the lead sponsors of the Stem Cell Therapeutic and Research Act, which Congress enacted late last year. This bill was essential in maintaining patient access to lifesaving treatments through the National Marrow Donor program and also opening the door to the developments of a companion registry system for cord blood.

We know the use of umbilical cord blood in treating diseases such as leukemia, sickle cell anemia, and rare but deadly genetic disorders such as Krabbe disease is showing tremendous promise. The Stem Cell Therapeutic

and Research Act solidified the Nation's commitment to increasing the number of cord blood transplants by providing additional Federal funds to help public cord blood banks increase their inventory, as well as support outreach, patient advocacy, and coordinating information and education activities.

The President also recognized the importance of this avenue of research. During the 2001 Executive Order, he said:

You should also know that stem cells can be derived from

sources other than embryos. And many scientists feel research

on these types of stem cells are also promising. Many

patients suffering from a range of diseases are already being

helped with treatment developed from adult stem cells.

He went on to add:

However, most scientists, at least today, believe that

research on embryonic stem cells offer the most promise

because these cells have the potential to develop from all of

the tissues of the body.

Those are the President's words. I urge all of us to heed those words today.

I urge the Senate to support H.R. 810 and also the President to sign it into law. I also intend to support S. 3504 and S. 2754, but neither of these measures is a substitute for H.R. 810.

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

Mr. President, I ask unanimous consent to lay aside the pending amendment and call up amendment No. 4613.

I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, my amendment would require the Coast Guard to report to the Committees on Appropriations and Commerce, Science, and Transportation on proposed changes to the civil engineering program before the Coast Guard takes any action to alter or reduce operations within this particular program. The mission of the civil engineering program is to provide high-quality planning and real property and facilities maintenance to support Coast Guard units across the country. In my judgment, reducing staff and reorganizing the civil engineering program is not appropriate, given the current workload and the increased number of homeland security responsibilities taken on by the Coast Guard. If significant reductions in personnel and offices take place, I have serious concern that the Coast Guard would not be able to adequately support its shore facilities in New England and across the Nation.

The work performed by employees of the Coast Guard civil engineering program is of paramount importance. It is important that Congress review any plan to reorganize or consolidate this program.

It is my understanding, hope, and expectation that the amendment will be accepted by voice vote. I thank my colleagues on the Appropriations Committee and the Commerce Committee for their kindness.

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

Mr. President, I ask unanimous consent to speak as in morning business.

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

Mr. President, when the administration released its midsession review of the fiscal year 2007 budget yesterday, it made a number of claims about how its policies have been successful at promoting economic growth and bringing down the budget deficit. In this case, however, as in so many others, the administration is looking through rose-colored glasses, exaggerating the successes of its policies and ignoring the true costs.

Let's begin by putting the improvement in the fiscal year 2006 budget deficit in perspective. It is true that tax revenues have grown this year--as they always do in a business cycle expansion--and that revenues have been coming in stronger than expected. But the current projected 2006 deficit of $296 billion is just a little lower than the fiscal year 2005 budget deficit of $318 billion. It is still the fourth largest budget deficit on record in nominal terms.

The Bush administration wants us to compare the current estimate of the fiscal year 2006 budget deficit with the exaggerated estimate of $423 billion they made in their February budget projection. As the noted budget expert Stan Collender wrote at the time:

This President has a well-established history of

overstating the deficit early in the year and then taking

credit when it turns out to be lower than projected, even if

it has done nothing to make that happen.

And, of course, that is exactly what we are seeing right now.

The real story is the sharp deterioration of the budget in this administration. When President Bush took office, the Congressional Budget Office projected large and growing Federal budget surpluses under existing laws and policies--the so-called baseline projection-- including a budget surplus of over $500 billion in fiscal year 2006. However, the President has presided over an incredible reversal of fortune. A $128 billion Federal budget surplus in fiscal year 2001 turned into a $318 billion deficit by fiscal year 2005 and a projected deficit almost as large in fiscal year 2006. This is not news to crow about. Frankly, it reveals, as I suggested, a tremendous reversal in the budget fortunes of this country.

A $5.6 trillion, 10-year projected surplus from 2002 to 2011 has turned into a deficit of $2.7 trillion. So from the time the President took office until today, what we thought was going to be a $5.6 trillion surplus is now a $2.7 trillion deficit, an extraordinary change in the fiscal year health of the United States.

Realistically, this 10-year deficit is probably much higher because it does not include big-ticket items such as the war costs which are being funded on supplemental appropriations and not properly projected into the budget base; and the need to make tax adjustments like fixing the alternative minimum tax.

Instead of sound budget policies aimed at preparing for the imminent retirement of the baby boom generation, the Bush administration and the majority in Congress have refused to adopt the kinds of budget enforcement rules that helped achieve fiscal discipline in the 1990s. They have pursued an open-ended commitment to stabilizing Iraq that relies on supplemental appropriations rather than the normal budget process, and they have remained committed to extending irresponsible tax cuts that will add further to the budget deficit. All of this comes at the cost of inhibiting greater economic opportunities for most American families.

That, of course, is not what we are hearing from the administration and its supporters who keep telling us that the economy is doing well, and that their tax cuts are an important reason why, and that everyone is benefiting. It should not be surprising that this is not a message which is resonating with the American people because, in fact, the current economic recovery has been weaker than the typical business cycle recovery since the end of World War II, and large numbers of Americans are still waiting to benefit from the economic growth that we are purportedly seeing.

Job growth has been very slow by the standards of past recoveries, real wages are stagnating, and disparities in income and earnings are growing wider. Last Friday we learned that employers added only 121,000 jobs to their payrolls

in June, and that employment growth over the past 3 months has averaged just 108,000 jobs per month. Those are not the kinds of figures you expect to see in a healthy job market. They are not even enough to keep up with normal growth in the labor force.

You also don't expect to see the earnings of the typical worker fallin behind inflation year after year in a growing economy, but that is what has happened since 2003. Average hourly earnings have fallen in each of the past 2 years, and real median household income has declined by about $1,700 under President Bush.

The benefits of economic growth over the last several years are simply not being shared fairly. Those at the upper income levels are seeing gains but, frankly, not the same robust gains of the 1990s, when we saw the proverbial picket fence, where there were positive gains at every level of income in the United States from the poorest to the richest. Now, we are seeing a distribution of income that is skewed to the very richest. At the bottom income and middle income level, there is a loss in real earnings since the President took office. They are not even keeping up.

While wages have stagnated and incomes are falling for most workers, profits have grown to record levels. Corporate profits have grown at an annual rate of over 16 percent, more than twice the average growth rate in past recoveries. Strong productivity growth has shown up on the bottom lines of shareholders, but not in the paychecks of workers.

It seems clear that investors are benefiting greatly from Bush administration policies, but hard work goes unrewarded. Most Americans depend on their salary, not their investments, to pay their bills. Too many Americans are being squeezed by stagnant incomes and rising costs for gasoline, health care, and education. Somehow, the Bush tax cuts are supposed to make up for this.

However, the nonpartisan Tax Policy Center estimates that the tax cuts passed this year will only save the typical American family about $47--about what it now costs to fill up the gas tank of their minivan. But taxpayers making over $1 million will receive a tax cut of more than $42,000--enough to buy a new Mercedes.

Ironically, the sources of the revenue surprises that have led to the improvement in the fiscal year 2006 budget prospectus mirror the growing disparity between incomes at the top of the distribution and incomes for typical American families. Corporate tax receipts are substantially higher than originally projected, and much of the unexpected increase in individual income taxes appears to come from income gains by high-income taxpayers.

In particular, tax receipts for income not automatically subject to withholding, known as nonwithheld receipts, were 20 percent greater during the first 9 months of 2006 compared to 2005. Nonwithheld income is not ordinary wages; it is income such as capital gains, executive bonuses, noncorporate business income, and interest on dividends.

Unfortunately, middle- and lower-income families are paying the price for the President's tax cuts for the wealthiest, as investments in programs that promote greater economic prosperity for ordinary Americans have become candidates for budget cutting.

The President's budget includes cuts to elementary and secondary education, student financial aid for higher education, job training for displaced workers, child care assistance so that parents can go to work, and community development grants aimed at expanding small businesses.

Getting our fiscal house in order is the first step toward keeping our economy strong. But we also can't shortchange investments in research and technologies that will create the high-wage jobs of the future. Our policies should be refocused toward promoting lifelong education and training for our citizens in order to allow Americans to increase their earnings, their personal savings, and their ability to own a home.

Today, we are at war and yet there is no sense of the shared sacrifice that has united this country in past conflicts. Our military families are making tremendous sacrifices, and too many of them have made the ultimate sacrifice in service to our country.

With $320 billion appropriated or pending for Iraq operations to date and more than 2,500 service men and women killed, the human and financial tolls are both more staggering than imagined.

With mounting war costs, the impending retirement of the baby boom generation, and deficits as far as the eye can see, it is unconscionable to think that we are being asked to make the President's irresponsible tax cuts permanent. Those tax cuts were poorly designed to stimulate job creation and broadly shared prosperity when they were first passed, and they have produced a legacy of large budget deficits that leave us increasingly hampered in our ability to deal with a host of challenges that we face as a Nation.

Large and persistent budget deficits have contributed to an ever- widening trade deficit that forces us to borrow vast amounts from abroad and puts us at risk of a major financial collapse if foreign lenders suddenly stop accepting our IOUs. We had a current account deficit of nearly $800 billion last year and our international financial debt continues to mount.

Raising our future standard of living and preparing adequately for the retirement of the baby boom generation require that we have a high level of national investment and that a high fraction of that investment be financed by our own national saving--not by foreign borrowers. We followed such prosperity-enhancing policies under President Clinton, but that legacy of fiscal discipline has been squandered under President Bush.

No matter how rosy a picture the administration tries to paint, neither the present nor the future fiscal outlook seems terribly bright. Instead of more tax cuts for the wealthiest among us, we need to invest more in hard-working families and create greater opportunities for every American. We cannot afford the costs of failing to meet that challenge

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

Mr. President, I rise today to speak in opposition to the Oman Free Trade Agreement.

International trade, if reached through the right paths, can confer tremendous benefits on all of its participants. Through this practice and agreements like this one, we have the opportunity not only to open up market access for American business but also to improve economic conditions for all participants.

Unfortunately, the Oman Free Trade Agreement fails to live up to that potential. This agreement does not provide for American business, while at the same time it fails workers both here, I believe, and potentially in Oman.

In 2001, the United States entered into a similar trade agreement with the country of Jordan. At that time, the agreement was heralded for its progressive labor standards. However, we have recently seen in Jordan instances of foreign workers forced into slave labor, stripped of their passports, denied their wages, and compelled to work for days without rest.

These incidents have been occurring in Jordan because Jordanian labor laws are only applicable to its own citizens and preclude protections for foreign workers.

What I sense is happening is that we have allowed, unwittingly, I believe, individuals and corporations in Jordan to exploit this agreement, to actually move people from countries outside of Jordan into Jordan, and to set up conditions that are not only horrible for the individuals but continue to put pressure on American working men and women in terms of reduced wages, and also do not act to raise the standard of living in Jordan.

One of the points of our agreement with Jordan was to provide the kind of conditions that would raise the standard of living for Jordanian workers. So I am terribly concerned about what could happen in Oman.

My fear in Oman is that they have far weaker labor standards, and that would lend itself to even worse conditions than in Jordan. In fact, the potential for seeing these types of abuses is much higher in Oman, where up to 70 percent of its workforce is comprised of foreign workers already.

During the ``mock markup'' of this agreement last month--the practice of the Finance Committee where they would go through and, in theory and concept, make the changes they would like to see take place--the Finance Committee unanimously approved an amendment to explicitly prohibit products made with slave labor or through human trafficking from benefitting from this deal, conditions similar to those in the Jordanian Free Trade Agreement. However, the administration chose not to include this simple, commonsense provision in the final implementing legislation before us today.

When our trade partners are held to different, less stringent standards, no one is better off. When Omani firms can employ workers in substandard conditions, the Omani workers and American workers both lose. The playing field is not level. The enforceable provisions of this free-trade agreement require only that Oman and the United States enforce their existing labor laws.

In Oman, this means that workers can be denied the right to collectively bargain and to strike. More egregious, Omani law is vague in its forbiddance of forced labor. I appreciate the commitments of Oman to clarify these provisions and to improve enforcement. However, the timeline for doing this is far too long. If we implement this agreement, and Oman fails to live up to its promises, then this agreement will benefit a few while hurting many.

I would note that part of the problem with all of these agreements is that they are considered under the President's fast-track authority, under which Congress is forced to take or leave even the most imperfect deals. And when the President ignores valuable input from Congress, particularly on issues such as labor standards, we are put in a position where our only choice is to vote against it.

I am a supporter of free trade, but that does not require me to support bad deals from an administration that is more concerned about getting a deal than getting the deal right.

We cannot allow other countries to break the rules. Our foreign trade partners must play by the same rules as we do because American companies and workers cannot compete with countries that engage in substandard labor practices. We have seen it again and again: trade policies that don't establish a real threshold for labor standards do not work.

So, Mr. President, I will vote against the Oman Free Trade Agreement.

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

Mr. President, today I recognize the 31st anniversary of the independence of Cape Verde. On July 5, 1975, this island nation gained independence from Portugal and since then has established itself as one of the most politically stable and economically viable countries in Africa.

After discovery by Portuguese explorers in 1457 and then again in 1462, Cape Verde was incorporated into the Portuguese Empire as the first European settlement in the tropics. Over the next several hundred years, it was a lucrative trading post between Europe, Africa, and the Americas.

A few years after World War II, with a growing nationalist movement, Portugal granted Cape Verde overseas province status. Within 5 years a group of Cape Verdeans and neighboring Guinea-Bissauans organized a coalition for the independence of Guinea-Bissau and Cape Verde. After the 1974 Portuguese revolution, the new government signed an independence agreement with all of Portugal's overseas provinces, including Cape Verde. After six centuries of colonial rule, Cape Verde formally gained independence on July 5, 1975.

Since the beginning of its independence, Cape Verde has strived for a democratic government. In 1991, the first multiparty elections in Cape Verdean history were held. Today, the Cape Verdean government is stable, with four parties sharing seats in the National Assembly. It has established market-oriented economic policies that are attracting foreign visitors, ensuring Cape Verde a strong service and tourism economy.

Cape Verde has also been an essential part of international security. Over the past month, Cape Verde has served as the proving grounds for the latest testing of the emerging NATO Response Force, NRF. With over 7,000 soldiers, sailors, and airmen, Exercise Steadfast Jaguar 2006 is a major test of the NRF's ability to operate quickly, strategically, and at distance. Facing a variety of environmental conditions, the NRF is able to execute its largest military maneuvers since its creation exercising a wide array of missions. The archipelago's terrain provide challenging beaches for amphibious assault, arid flatlands for ground warfare, and a mountainous volcano for humanitarian relief after a fictitious eruption. These exercises, while still ongoing, can only be measured as a success and a true representation of international cooperation.

Today there are close to 350,000 Cape Verdeans living in the United States, almost equal to the population of Cape Verde itself. Many of these Cape Verdeans make their home in Rhode Island. On behalf of the residents of my State, I wish to thank them for their contributions to our country.

Finding its place in the international community, Cape Verde has stood up to assist the world's peacekeeping force in their infancy. It is fitting we honor Cape Verde's independence along side of our own. They understand the importance of a democratic society and international responsibility. I send all Cape Verdeans in Rhode Island and around the world my best wishes as they celebrate their homeland's independence

Mr. President, as we consider the nomination of Henry Paulson to be Secretary of the Treasury, I think it is important to bring a reality check to some of the claims about the current state of the economy--those claims made by the administration.

My colleague, Senator Bennett, pointed out that yesterday we had a hearing in the Joint Economic Committee, and appearing as a witness was Edward Lazear, chairman of the Council of Economic Advisers. We had also two outside experts who were economists testifying on the state of the economy. Many of the Bush supporters are claiming that the economy is strong and everyone is benefiting, but I doubt that many working Americans would see it as strong as they do and see it as benefiting them as much as it is claimed by the administration.

It is true that the economy is experiencing a business cycle recovery after the 2001 recession and after going through the most prolonged job slump since the 1930s. The President pointed out that the economy has done better since 2003 than it did in 2001 and 2002, but they don't talk about how this recovery has not been particularly strong by the standards of previous recoveries.

This first chart shows the percentage change in payroll employment. The curve here is the average of seven previous recession recovery cycles. If you look back, historically, it is a much more robust increase over time than this lower line, which is the March 2001 to May 2006 statistics, the recovery in the last several years. In fact, this recovery is much less than the recovery was after the 1990 recession. That recovery was called the ``jobless recovery'' because job generation was so slow.

So what you are seeing is that job losses continued for much longer in this period of time, 2001 to 2006, than had been typical. This recovery has been much weaker than those in the past. At this point in the recovery, from the 1990 to 1991 recession, the economy had created 5 million jobs.

That is this delta right here--5 million more jobs than have been created in this recovery. So the difference between job generation at the same point in March 2001 to 2006, and comparing it to the 1990s, is plus 5 million jobs.

This situation is similar with respect to business investment. It took much longer for the recovery to start with respect to business investment, and the level of investment lagged behind what has been typical in past recoveries. Each year of depressed investment means less capacity to produce goods and services in the future.

Defenders of the President's economic record cannot deny that workers' wages have not been keeping up with inflation. Part of that is a result of many factors but, one, looking back at the investment, it has been a relatively small recovery in terms of business investment. Here is the average of seven previous recoveries and here is the 1991 recovery business investment and here is the current recovery. It is not as robust as it has been in previous recoveries.

As I suggested a moment ago, there is another very palpable impact of this bad economic news, and that is that wages have not been keeping up with inflation. This will be, no doubt, no surprise to working families as they work to get their paychecks each week. Some have suggested that this is a result of the fact that wages are held down but benefits are growing, and that compensation is growing at historic rates. This is not the case.

This is a chart that shows productivity, the output per hour, and real compensation per hour. What you generally see is that productivity increases will be closely tracking compensation increases except over the last several years where productivity is going up at a significant pace, but real compensation, wages plus benefits, is lagging far behind. This is what the average American is confronting today when they are looking at increased gasoline prices, soaring health care prices, and they are not seeing either in their paycheck or, in many cases, even benefit packages the same kinds of increases that are so necessary to keep up with an increase in inflation. Growth in compensation has lagged behind. Wages have grown more slowly than total compensation, but that is not because workers are negotiating better deals from their employers, it is because employers are facing higher costs for health insurance and are squeezing workers' wages as a result.

Increased health care prices, particularly in the area of small business, is causing many businesses to forego increases they would like to give to workers, in terms of wages, just to keep up with increased health care costs. This doesn't mean a better health care package for workers, and in some cases workers are being dropped, unfortunately, from health care protection because of the expense.

What we are seeing is that compensation is not keeping up with productivity and, typically, compensation does keep up with productivity. There is another issue, too, with respect to the situation for many American workers, and that is the fact that pension arrears have to be made up. Many companies now are putting money into pensions just to make them actuarially sound, where in the past they might have devoted that to wages. By and large, the situation, when it looks at the working men and women, is that we are not seeing the robust increases in wages or compensation that is important.

These points were made by one of the witnesses yesterday at the JEC hearing, chief economist of the Bank of America, Dr. Mickey Levy, who testified that:

Wage and compensation increases have been somewhat

disappointing. Real wages have been suppressed by higher

energy costs and have not kept pace with labor productivity

gains. . . .Wages may be constrained by higher employer costs

for workers' health care, along with the heightened

international competition related to low cost production

overseas. . . .

Wage and compensation increases have indeed been disappointing, especially for the majority of workers who are not getting them. Gains in average earnings or income do not tell the real story when they hide growing inequality. When you look at one level, you see increases, but when you look at how the increases are distributed across the working population, it is another story altogether.

The red bars on this chart show that workers in the middle and bottom have experienced a decline in real earnings, while those at the top have experienced gains. This is in sharp contrast to the experience of the time from 1995 to 2000. Here in blue, in the data for gains in terms of earnings, broken down by the lowest 10th percentile, 25th, median, 75th, and 90th, at the upper level in the 1990s you saw increases, but they were almost comparable at the very lowest level of income. You saw the proverbial picket fence, where there were positive gains at every percentile. What we are seeing today is quite the reverse of that--losses in real terms of earnings at the lowest levels through

the middle levels, and only at the upper income levels are you seeing real gains in earnings.

So the distribution of the economic progress that is being made over the last several years is not being shared fairly. Those at the upper income levels are seeing gains but, frankly, not the same robust gains of the nineties. At the bottom-income and middle-income level, there is a loss in real earnings.

That is not an example of an economy that is working for all Americans. That is an economy that is working for the very affluent Americans. The answer of the Bush administration to these economic trends is basically to ignore them, try to gloss over them or redefine them or explain them away. They proposed tax cuts, which will do very little to help this distribution of earnings. In fact, what it does, essentially, is protect more of the earnings at the upper income levels. If we continue along the present course, we will be undermining the economy's longrun capacity for growth and undermining future living standards.

Another aspect here, too, that is not dwelt upon by the administration is the fact that we are virtually zero in national savings. Without national savings, there is not the pool of investment capital necessary to provide for the new technology, new capital of the future. We are borrowing huge amounts of money overseas to fund our deficit. This is investments made in our country. But in terms of national savings of this country, it is close to zero. In some cases, it is negative.

These are the real problems that confront this country. These are the real questions that Mr. Paulson has to address. How do we create an economy that performs as well as it did in the 1990s, where earnings gains are shared virtually equally across the spectrum of income, where low-income Americans don't see a loss of earnings but actually a gain? How do we ensure that wages and compensation keep up with productivity gains? How do we ensure essentially and fundamentally that the working families in this country cannot only get by but get ahead? That is the question that Mr. Paulson has to answer as Secretary of the Treasury.

I think it begins with looking hard at the deficit and the policies of the administration with respect to taxes. I don't subscribe to the theory that our deficit is caused by runaway entitlement programs. We have an issue with entitlement programs, but we also have an issue with tax programs that take away revenue and are targeted to the wealthiest Americans. We have problems with expenditures that we cannot avoid with respect to supporting our forces in the field. We cannot stop providing equipment and materiel for our forces fighting the wars today, and we have to take care of them in the future. But there are significant issues with which we have to deal. I hope Mr. Paulson will be a strong voice in this administration to look at the facts and propose realistic solutions that benefit not just the few who are wealthy but the vast majority of Americans.

Mr. President, I yield the floor.

Mr. President, yesterday I opposed Senate Joint Resolution 12, which would have created a constitutional amendment allowing Congress to ban desecration of the flag.

As a graduate of the U.S. Military Academy and a former officer in the Army, I am deeply offended when people burn or otherwise abuse this precious national symbol.

I also believe, however, that the values and beliefs that the American flag represents are more important than the cloth from which this symbol was created. Prominent among these beliefs are the right to voice views that are unpopular, and the right to protest. In fact, these fundamental values, preserved by our Constitution, have distinguished our Nation for more than 200 years. The Framers understood that democracy cannot thrive, or even survive, without freedom of expression. Colin Powell has rightfully said, ``The first amendment exists to ensure that freedom of speech and expression applies not just to that with which we agree or disagree, but also that which we find outrageous. I would not amend that great shield of democracy to hammer a few miscreants. The flag will be flying proudly long after they have slunk away.''

I oppose this amendment not because I condone desecration of our flag, but because I celebrate the values our flag represents. Flag burning is despicable. However, the issue is whether we should amend our great charter document, the Constitution, to proscribe it.

In The Federalist, James Madison declared that the Constitution should be amended for ``certain great and extraordinary occasions.'' Except for the prohibition amendments, since the adoption of the Bill of Rights, we have only amended the Constitution for ``great and extraordinary occasions:'' abolishing slavery and giving African Americans the right to vote; extending voting rights to women; and regulating elections and the tenure of the Presidency. Of the 27 amendments, 17 protect individual rights and liberties. In fact, we have never amended the Constitution to constrict rights that other amendments already guarantee.

So are we facing a ``great and extraordinary occasion'' justifying the use of a constitutional amendment? I would argue no.

First, an amendment permitting government restraints on free expression cannot compel loyalty to or love for either our country or our flag. The proposed amendment would pronounce to the world that we value free speech, except when it offends, that we tolerate free expression, except when it is demoralizes.

Second, is this a problem needing such strong medicine? Are we facing an epidemic of flag burnings? In fact, over the past 10 years, only 7 incidents of flag desecration have occurred per year on average, most of which have been successfully prosecuted under laws prohibiting vandalism, theft, disorderly conduct, and disturbance of peace. Indeed, passing such an amendment would probably do more to promote flag burning by malcontents than any other action this Congress could take.

Third, proponents of such an amendment declare that it would boost the morale of our troops and help restore some of the American values so basic to the fabric of our country. But, as one veteran recently wrote, ``I did not believe then, nor do I believe now, that I was defending just a piece of geography, but a way of life. If this amendment becomes a part of our Constitution, this way of life will be diminished.'' I cannot help but believe that a more appropriate expression of support for our troops would be providing them with the equipment they need in the field, better benefits for their families, and an adequately funded medical system at home.

Although I oppose a constitutional amendment, I did support an alternative approach offered by Senator Durbin. Senator Durbin's amendment contained two elements. First, it would

have created a statutory prohibition against desecration of our flag. This part of his amendment was drafted to follow the guidance of the 2003 Supreme Court decision in Virginia v. Black, which upheld a Virginia law banning cross burning that is intended to intimidate. The Durbin amendment took a similar approach and prohibited desecration of the flag when it is intended to incite violence. The Durbin amendment also would have promoted respect for families of deceased members of the Armed Forces by prohibiting demonstrations at their funerals. The amendment was narrowly tailored to make these disrespectful demonstrations punishable.

In sum, debating a constitutional amendment on desecration of the flag, although politically popular, is not how the Senate should be spending its few remaining legislative weeks. But this is a campaign year, and the majority appears to want the Senate to spend time on topics which defer and deflect us from concentrating finding solutions to pressing issues facing our Nation: restoring fiscal discipline, creating safe and affordable housing for working families, securing our borders, expanding health insurance coverage to the uninsured, ensuring students have the skills and tools to compete in an ever-expanding global economy, and redeploying our troops as quickly as possible out of Iraq. Unfortunately, the majority has provided limited time to debate most of these issues.

I hope that with the rapidly dwindling number of days left in this session we will work to address the very real concerns that impact American families every day. I fear, however, that this debate is only a harbinger of what is to come and very clearly signals why we need a new direction.

Mr. President, I yield myself 5 minutes from the time allotted.

Mr. President, we should take heed of what the Government of Iraq is doing and saying. We should take heed of the fact that it has made progress in establishing itself and making significant steps forward. In this context, let me again remind my colleagues of what the National Security Adviser for Iraq has said. He suggested we should begin withdrawing troops by the end of this year. That is what the Reed-Levin amendment would require. He also suggests and predicts that by the end of 2007 most American combat forces would be out of the country. He says, in his words:

The eventual removal of coalition troops from Iraqi streets

will help the Iraqis, who now see foreign troops as occupiers

rather than the liberators they were meant to be. Moreover,

the removal of foreign troops will legitimize Iraq's

government in the eyes of the people.

I concur with Senator Warner that we should support the Iraqi Government, pay attention to what they are saying. I think we should pay particular attention to what Iraq's security advisor has said. This was not a casual off-the-cuff remark. He said it first on CNN, where he knew he was speaking to a world audience, particularly an American one. Then he crafted a very careful op ed opinion for the Washington Post. If that is what one of the key leaders of the Iraqi Government is saying, then I think that supports our efforts for the Reed-Levin amendment.

Also, this amendment has been mischaracterized grotesquely. This is not some arbitrary fixed timetable. This is not something where dates mean dates specific. We say precisely that the President shall submit to the Congress a plan by the end of 2006, with estimated dates for the continued, phased redeployment of U.S. forces, with the understanding that unexpected contingencies may arise. I think my colleagues demonstrate a lack of confidence in the ability of the President, listening to his commanders in the field to prepare an estimate of our posture in Iraq over the next several years. There is no end point in our amendment because we recognize, as so many others, that this process could take an indefinite time but a time that at least could be estimated by the President.

Let me also suggest that the Levin-Reed amendment recognizes there will be a residual force in Iraq of American trainers, American logisticians, and of special operations troops to seek out these terrorists, rather than having young Americans at checkpoints who are subject, because of a lack, apparently, of coordinated support, to being attacked successfully by Iraqis. That mission should be done by the Iraqis. But we cannot give up the right and capability of striking at terrorists in Iraq. This amendment clearly states that. It is something else, too, because we have a lot of people coming to the floor talking about we are going to stay the course and we are going to support them.

We have done nothing virtually with respect to nonmilitary support, effectively, for Iraq. Where are the State Department teams? Months ago, with great fanfare, the President announced we are going to develop eventual reconstruction teams and put them in the provinces of Iraq. There are only four. They lack resources, they lack personnel, and they lack real support and emphasis. Unless we can fix some nonmilitary aspects of the reconstruction, redevelopment, political mentoring, our military efforts will buy us time that we will squander, as we have squandered to date.

Now, the real test of the other side is not the rhetoric on the floor and the slogans that you cannot ``cut and run'' and appropriately recognizing the great sacrifices of our forces. It is coming down here with a plan--over many years, according to them--and the resources to support that plan--the billions and billions of dollars that we will need over the next several years, the personnel we need in the country, not just from our military forces but from our State Department, our Agency for International Development, and our Justice Department. If we are truly committed to this concept of complete victory, we need a plan. The President has to deliver such a plan. This amendment will require him, we hope, to sketch out that plan.

At the heart of this, it is not about satisfying the Congress, it is about confiding in, with candor, the American people, telling them what the risks are, what the costs are and how we are going to pay for it. It is easy to come down here and say we are going to support our troops and do all these things. But then 2 weeks from today, or a week from today, we will have a bill to cut the estate tax. How do we pay for these troops and give them equipment and reset our equipment? How do we give resources for troops in the field and support this new Iraqi Government? With what?

The real test of the other side will be when they come up with a plan and with money and with resources. I believe this approach is the most sound tactically, strategically, and politically, not to surrender but to succeed.

I yield the floor.

Mr. President, I join with my colleague, Senator Levin, and Senators Feinstein and Salazar, to offer this amendment. Too often, the Bush administration deals simply in slogans. We have heard them so often, so many times: mission accomplished; stay the course; don't cut and run; we will stand down when they stand up; complete victory. But a military operation such as this requires much more than slogans. It requires sufficient personnel and adequate equipment. It requires coherent strategic policy, and it requires detailed plans.

At critical junctures in this effort in Iraq, this administration has been extraordinarily insufficient in all of this. We had insufficient personnel on the ground with the collapse of the government of Saddam Hussein. We opened up regions of Iraq so that insurgents could begin to form and begin to conduct this attack against their own people and against our people. Too often we went out to Iraq, visited the country, and were confronted by our own soldiers who complained that they didn't have armored humvees and body armor.

I believe there has never been a really coherent strategic policy here. We heard the initial defenses of the approach to Iraq as we were going after weapons of mass destruction. They were not there. We are going to go after the heart of terrorism, when in fact the terrorists' connection to Saddam Hussein was tangential at most. Then, we are going to build an oasis of freedom and transform the Middle East. It is not an oasis today in Iraq.

Certainly there were not detailed plans. We entered into this occupation without sufficient planning, without sufficient resources in so many different ways. The faults continue to plague us today. Insufficient resources to run detention facilities contributed in a significant way to Abu Ghraib, and that, as even the President admits, has been an extraordinary blot on our record and inhibits us today in our ability to achieve a stable Iraq.

There is something else that you need to conduct military operations, and that is public support. Today, a majority of Americans would like to see a deadline to withdraw our forces from Iraq. They are not unpatriotic. They are not without grit and determination. They are terribly concerned, and they are looking for leadership.

But I believe this leadership comes in not adopting some type of arbitrary timetable or deadline; it comes from adopting what is the most coherent and realistic policy we can today to stabilize the country of Iraq, to assist them in this stability, and to begin the phased redeployment of our forces from Iraq to begin this year. To begin, not with an arbitrary timetable or deadline, but to begin with the notion that these decisions will be based upon the advice of military commanders and based upon the conditions on the ground. But we must begin. We must begin because we have to send a strong signal to the Government of Iraq that they must take their future in their own hands, that they must make difficult choices about their constitution, about sharing political power, about eliminating sectarian elements from their security forces, and a host of other difficult problems. This rests upon the fundamental reality of the situation. Ultimately, it will be the Iraqis who stabilize their country and reform their country. We can help. We have helped. But it is up to them, and it must begin now.

Also, this approach which we are proposing recognizes another reality. Our military forces, our Army and our Marine Corps, have been under tremendous pressure. They have done a magnificent job. The young men and women who wear the uniform of the United States have performed in an extraordinary fashion. But for some of them, it will be their third deployment to Iraq. Others have gone to both Iraq and Afghanistan. The wear and tear on these young Americans and their families is significant. The wear and tear on our equipment is significant. There is a $50 billion pricetag just to repair the equipment that has accumulated over the last several years in Iraq. So we have to recognize also that our forces need a signal that their mission will be coming to a conclusion, not in the next Presidency but, based upon a careful deliberation by the commanders, we hope in the near future.

We also have to recognize that our threats are not confined to Iraq alone. Today we are all waiting anxiously to see what the North Koreans might do with respect to a scheduled--or at least a tentative launch of an intercontinental missile. We are today engaged in serious negotiations with our European colleagues with respect to the situation in Iran. We have seen in the last few weeks an Islamic government takeover on the streets of Mogadishu and Somalia. We have seen other areas of concern and conflict. Our commitment in Iraq, frankly, constrains our flexibility to deal with all these issues.

Senator Levin and I have come forward today with a proposal that we believe will be an approach that begins a policy that we can achieve, that it is necessary for us to achieve, so we can move forward to begin to transition the burden from American military shoulders to those of the Iraqis. It begins with a phased redeployment which we believe should commence this year. Let me hasten to add again: There is no specific timetable. There is no deadline. This is based upon the advice of our military officers in the field. This is not cut and run or cut and jog or cut and anything else. It is an attempt to articulate a policy based upon the reality of Iraq, the reality of our present military forces, and the reality of a world which is engaged in conflicts in many different places.

In the past weeks, we have seen some progress in Iraq--the installation of a government, the naming of a Prime Minister of Interior, and the naming of a Prime Minister of Defense. We have seen the death of Zarqawi. But still we recognize how turbulent and uncertain and how hostile the environment remains for our soldiers and the Iraqi security forces.

We have about 127,000 forces there in the last 3 years, or more. We have seen more than 2,500 of these young Americans killed and more than 18,000 wounded. Their sacrifices have to be respected and honored--not simply with force but with wisdom and with a policy that will work, a policy that is attuned with what is happening in Iraq and around the globe and not a policy based upon bumper stickers that have been trotted out at a moment's notice.

We recognize that we have an interest certainly in Iraq in terms of succeeding. And this plan we hope and we believe will be a success. We are putting together a plan--more of a policy than a plan--because the planning is the province of the President, as it should be, as Commander in Chief. But a policy of redeployment beginning now is the right direction. It will require the President to begin to outline those steps. It will also require the Government of Iraq to begin to take responsibility for their own situation. It will require them to begin deliberations for constitutional changes. These changes are necessary to ensure that this is an inclusive Government in Iraq, that the Sunni community feels that they can have a future in the new Iraq.

It also recognizes that we have to have a sharing of political power in Iraq so that Iraq will succeed.

In addition, the Iraqis must address the issue of sectarian militias, and the infiltration of security forces by sectarian elements have to be dealt with and dealt with decisively.

We also have to recognize that ultimately these decisions will be made and must be made by the Iraqis.

In this proposal there is a clear signal to the Iraqis that they must make these decisions beginning now for their future and, we hope, for a stable region and a much more stable world.

We also understand that we have to bring together the international community.

Since October of 2002, I have argued that this unilateral approach to Iraq is not destined for success; that we have to have a multinational approach to be successful. We have carried the burden both militarily and in many other ways. It is time that the administration engage and energize the regional neighbors and the broader international community to help address the issues that are presented to us all throughout the world by Iraq.

We understand, on a financial basis, that this is an expensive undertaking.

Originally, the administration suggested that this would be $50 billion or $60 billion. We understand now that we have already spent $320 billion, and the end is not in sight.

In a recent study by Joseph Stiglitz, the Nobel prize economist, if you added all the costs, all the costs of rehabilitating our equipment when comes home, all of the cost of veterans' benefits and caring for those who have served so well, the price will reach perhaps $1 trillion, if our commitment extends until 2010.

Also, the international community has to do much more. The international community has pledged $8 billion, and only $3.5 billion of that money has been forthcoming. They need to do more, and we need to make them do more.

This approach of going it alone has to end. And part of our amendment is to request that we engage in a much more multilateral approach to Iraq.

We have trained 116,000 Iraqi soldiers, sailors, 148,000 Iraqi police and highway patrol and other Ministry of Interior forces. There are 102 operational Iraqi combat battalions in their Army, and 69 are either in the lead or operating independently.

We have made progress. We hope that they are ready, but we think that we have made enough progress to begin our redeployment. Again, the pace of that redeployment will be set by our military commanders.

As General Casey pointed out:

As we are able to draw down our forces, we will receive

additional benefits. A reduction in American forces will

essentially push more Iraqi troops to the front lines. This

is about the dependency.

Those are General Casey's words.

As long as we are there to do the heavy lifting, we will do the heavy lifting. That is an important point to be made and emphasized again and again.

The Government of Iraq was formed. Their National Security Adviser, Mr. Rubaie, stated this week in an editorial that Iraq's position is that it have full control of the country by the end of 2008, and this will mean a significant foreign troop reduction. We envision U.S. troop presence by the year's end to be under 100,000 with the most of remaining troops to return home by 2007. The eventual removal of coalition troops will help the Iraqis who now see foreign troops occupying rather than as liberators. Moreover, the removal of foreign troops will legitimize the Iraqi Government in the eyes of its people.

I do not know if my colleagues will come and accuse the Iraqi National Security Adviser of cutting and running on its own country. Perhaps they will, but they will be wrong.

That is what a leading figure in the Government of Iraq is suggesting. A phased redeployment beginning this year, hopefully concluding by the end of 2007--but again we will leave that up to our military commanders. The benefits will be that the Iraqis will step forward, and also this notion of occupiers will be diminished substantially.

From many different perspectives, this is the right policy at the right time. I hope that our colleagues, on a bipartisan basis, will embrace this policy.

I retain the remainder of any time I have and yield the floor.

Thank you, Mr. President.

There are two key elements in the Levin-Reed amendment. The first is to begin redeployment, this year, of American combat forces in Iraq. So many of my colleagues have mentioned Mr. Rubaie, who is the National Security Adviser for the Iraqi Government. On two occasions he has said it is not only feasible but desirable. He said it first on television, and then he said it just this week in a carefully crafted editorial. So this is something that I think can be done, and, according to a key leader in the Iraq Government, should be done.

The second element is that the President should submit to Congress a plan by the end of 2006, with estimated dates for the continued phased redeployments of U.S. forces from Iraq, with the understanding that unexpected contingencies may arise. The President should do this with the understanding that unexpected contingencies may arise.

This has been referred to as an arbitrary timetable. It is not arbitrary, and it is not a timetable. It is not a timetable of our creation, but it would be of the President. So do, I assume, those who object to this feel that the President could not produce such a timetable? Or if he did produce such a timetable, it would be arbitrary, that it would be made without consultation with our military leaders, that it would be made without reference to conditions on the ground? I do not think so. In fact, I think such a timetable would be appropriate and necessary.

Also, I should point out that our amendment recognizes the residual

presence of U.S. forces in Iraq, those that will be training Iraqi forces, those that will provide logistical support, and those that would conduct counterterrorism operations, our special operations troops.

But, essentially, what we would also like to do, which is so critical, is to begin this transition from a predominantly military response to a nonmilitary one. During and after the phased redeployment of U.S. forces from Iraq, the United States will need a sustained nonmilitary effort to actively support reconstruction, governments, and a durable political solution.

One significant reason why our military is stuck in Iraq today is because we have not made an appropriate nonmilitary effort. The administration has bungled reconstruction. They have yet to deploy more than 4 provisional reconstruction teams in the almost 18 provinces in Iraq. They continue to lag behind in terms of political mentoring, in terms of reconstruction, in terms of economic activity. They have done nothing.

As a result, the only real viable tool we have is military forces. And the commanders will tell you on the ground that they are just buying time, that without this nonmilitary effort, all of our plans for Iraq will not succeed.

Any effort like this requires popular support. Popular support rests upon candor with the people. This administration has not been candid with the people. They have not been candid with respect to the costs of this war. And those costs will go up.

Indeed, to stay the course, we can predict billions and billions and billions of more dollars. They have not been candid with respect to the length of our operations. They have not been candid with respect to the impact of these operations on our troops. They have substituted slogans for candor.

This amendment gives the President an opportunity to present a plan not only to the Congress but to the American people, a plan that will be candid, a plan that will strive for victory, a plan of his making. Without such a plan, we will continue to drift, and the chances of success will continue to diminish.

I will yield.

Mr. President, I rise this morning to discuss the fiscal year 2007 Defense authorization bill. I am glad it is on the floor. It is very important legislation, and it is arriving in a timely manner where we can dispose of it along with the other body and hopefully conclude in the next few weeks with a finalized Defense authorization bill.

I would also note that this is Senator Warner's last bill as chairman of the Senate Armed Services Committee, and I personally want to commend him and thank him for his leadership, not only as the chairman of this committee, but as a young sailor, a young marine, and a more mature Secretary of the Navy, and now a mature Member of the United States Senate. So thank you, Senator, for your leadership and friendship.

I would be happy to do that, in the future.

I would like to highlight some of the aspects of the bill which I think are very important. I have had the privilege of working with Senator Cornyn as the ranking member of the Emerging Threats Subcommittee. It has been a real pleasure. He has conducted the committee with great efficiency and great cooperation. The staff has been particularly helpful on a bipartisan basis.

I am pleased to note that in the context of our deliberations, several important measures were included in this legislation. First, we have authorized an additional $400 million for science and technology programs. The original request sent by the Department of Defense was woefully inadequate. Science and technology is the key to our future on the battlefield as we match the skill and valor of our soldiers with the very best technology. We have to continue this investment. I am pleased that our legislation increases that item by $400 million.

Also, the bill includes language to require a report to Congress on the testing policies and practices that should be pursued with respect to rapid acquisition programs, spiral development programs, quick reaction fielding programs, and the testing for safety and survivability of deployed equipment. One of the weaknesses, I believe, with the present approach of the Department of Defense is a failure to adequately test and evaluate, and I think that failure has to be corrected and this report will, I hope, put attention on this issue and lead to positive results.

The legislation also urges the Department of Defense to identify and nominate an individual to serve as the Director of Operational Test and Evaluation. This position has been vacant since January 2005. It is a critical position. This individual is the key independent personality in the Department of Defense to look at the testing and evaluation of new equipment. Without this position, the testing emphasis is woefully inadequate in the Department of Defense.

As we put new systems into the military, we have to ensure that these systems are adequately tested. Without an individual with that responsibility and that position and posture within the Department of Defense, we are not providing the appropriate personality and mechanism to do the job.

The bill also establishes the Joint Technology Office to coordinate all DOD hypersonics research programs in

conjunction with NASA. The new office reflects an appreciation of the important role that these technologies can play in advanced air platforms, missile systems, and space systems. The committee's provision is an effort to ensure that millions of dollars being invested by the services and by DARPA in hypersonics are optimized and coordinated to enable this maturing set of technologies to reach operational capabilities at the highest possible rate and at the earliest possible time.

The bill also extends the authority for DOD to run technology competitions and awards cash prices to winners. This is a provision that DARPA uses very effectively.

The bill also authorizes more than $30 million in increases for research that supports defense manufacturing technology. A growing concern in the United States, in both the defense and commercial sector, is whether or not we have the capability to manufacture what we invent. This money will help us enhance our manufacturing abilities throughout the United States.

There is another area of the bill that I think is very important and that is the area that helps us protect this country from weapons of mass destruction. First, the Cooperative Threat Reduction Program of the Department of Defense is fully funded with a budget request of $372 million. The Cooperative Threat Reduction Program is one of the leading nonproliferation programs. It allows our Government to cooperate with other governments, principally those of the former Soviet Union, to reduce the availability and supply of the fissile material and potential access to nuclear devices.

Also, the nonproliferation programs at the Department of Energy are fully funded at $1.7 billion. This funding is critical. One of the most obvious threats and the most grievous threats to face this country is the existence of nuclear weapons, particularly if they fall in the hands of terrorists. One very effective way to prevent this potential apocalypse is to ensure these weapons are fully under the control of a credible responsible party. In fact, in many cases we are destroying some of this material to prevent it from ever being used again.

The bill also includes an important waiver for the President with respect to the conditions that Russia must meet for chemical weapons destruction programs. It is important to continue to have these programs go forward. This waiver gives the President flexibility to continue these efforts.

In the areas of combating terrorism and homeland defense, the bill authorizes funding increases of about $150 million. Approximately $100 million of these funds are being used to fund the top eight unfunded requirements of the Special Operations Command. We all understand each of the components of the Department of Defense submit their requests. These eight elements were not funded under the prevailing budget. Our legislation would provide $100 million to do that and allow our special operators to continue to enhance their technology and their programs.

The increase will provide, I think, also, support for our Weapons of Mass Destruction Civil Support Teams. These are military teams that are organized in case of a weapons of mass destruction incident in the United States. They are critical. The original 32 teams played a key role. This would allow them to upgrade their equipment.

The bill also authorizes about $70 million to fund two of Northern Command's highest unfunded priorities. Included among these priorities are interoperable communications to facilitate the support of civilian authorities. This is an obvious need after Hurricane Katrina. When we go back--I am sure my colleagues are in the same position--to our home States we hear a persistent cry from fire and police officials that they need interoperable communications to talk amongst themselves and to talk to other levels of command.

The bill also creates a senior executive position within the Office of the Assistant Secretary for Defense for Special Operations and Low- Intensity Conflict to provide management oversight for SOCOM's acquisition programs. One of the lacking elements in SOCOM's organization is an acquisition specialist. This bill would put in a person with those skills, so they can facilitate the acquisition and development of new technology for our Special Operations Command.

The bill also includes an authorization for the Department of Defense to use counterdrug funds to support U.S. assistance to the unified counterdrug/counterterrorism military campaign in Colombia. Last April, I was in Colombia and I had the opportunity to meet with President Uribes. I was encouraged by what he has done and what the people of Colombia have done. I also visited with our military personnel and civilians working to help the Colombian military personnel who have been working to fight narcoterrorism and strengthen democratic governance in Colombia, and I was extremely impressed with what they have done since my last visit in 2000. I believe, as we support the Colombians in their efforts, we will make a significant contribution to stability in that region.

Finally, with respect to our efforts on the Emerging Threat Subcommittee, I note the bill includes authorization for incentive clauses in some of our chemical demilitarization contracts. This authority is intended to provide a more efficient way to close some of our chemical weapons facilities and to meet international deadlines.

All of these efforts were the result of the close cooperation of Senator Cornyn and the staff with respect to the Emerging Threats Subcommittee.

Let me now turn to an issue of increased importance in the last few days and that is missile defense. We are all anxiously observing what is going on in North Korea--the intelligence suggesting that the North Koreans are preparing to launch a long-range ballistic missile.

This bill contains language that I think recognizes a need to continue to develop a missile defense system and to do so in a way that can assure its effectiveness. The bill would authorize additional funding for systems that we know are working and are extremely valuable, including the Aegis BMD system and the Patriot/PAC-3 system. I note the Patriot system is our only system that has actually intercepted a hostile missile, and that additional support for this system is more than justified. I also note that the Patriot system was rigorously tested and was subject to operational testing before it was fully deployed.

The largest single missile defense funding increase which is authorized by this bill is $115 million for additional integrated flight tests for the Ground-based Mid-course Defense system, the GMD. I think it is very important to focus in on operational testing of this system. One of the shortcomings of the whole program for developing our missile defense system has been a rush, in many cases, to failure, not taking the steps to test the system or not designing tests that are operationally significant. In that respect, we have spent a lot of money but we have yet, I think, to fully and effectively deploy the ground-based mid-course system.

We have to recognize that after three successive intercept flight test failures, the Missile Defense Agency is taking some steps which I think are encouraging. They created an Independent Review Team and a Mission Readiness Task Force to analyze these failures and recommend improvements to the GMD program.

Again, one of the persistent criticisms I had was that the system was rushing pell-mell forward without stopping to evaluate the mistakes that have been made and then planning for a thorough and exhaustive system of tests. Therefore, the effort was just to put something in the ground, not to ensure that missile system would work adequately.

MRTF, the Mission Readiness Task Force, recommended that four ground- based interceptors be diverted from planned operational deployment-- essentially sitting in the ground being described as operational, but frankly I don't know anyone who would give that a high probability of success--to using these missiles for ground tests. I think that is a step forward in terms of development the system.

These recommendations were accepted by the Missile Defense Agency and the Defense Department. Again, I think a recognition of a new pragmatism and realism on the part of the Missile Defense Agency, something

that is more than overdue. We need more testing to ensure the GMD system will work, and I think the legislation we have before us will signal and encourage such testing.

The bill would also include a provision that would require the Department to submit to Congress each test and evaluation plan approved by the Director of Operational Tests and Evaluation under Section 234 of last year's National Defense Authorization Act. Again, this provision is designed to help improve testing and to show the emphasis that the Congress places on this testing.

Finally, the bill includes a provision that would extend the requirement to have the GAO assess the missile defense program. The GAO plays a very valuable role as an outside objective observer on the progress of missile defense.

We have to invest in a missile defense system, but we have to do it wisely. We have already seen where the effect of other budget priorities, principally Iraq, has even caused the administration to move money away from their original plans in missile defense. I believe we cannot afford to waste money in this regard. We have to invest it wisely. Part of that wise investment means having an adequate, thorough, exhaustive operational testing program to make steady progress, rather than to rush to failure.

I would like to turn to another topic which is of concern to myself, and that is the shipbuilding program. Since 2001, most of the focus of the Department of Defense and Congress, indeed, of the Nation, has been on our land forces, the Army and Marines. They are engaged in combat in Afghanistan and Iraq and doing a magnificent job. They are bearing the burden of a very difficult combat situation.

However, our Navy is still a vital element in our national defense. Its importance will continue to loom significant in the future. The CNO has stated that he needs $13.5 billion each year for at least the next decade to recapitalize the fleet. With this funding, the Navy must also build approximately 11 ships per year to maintain a 313-ship fleet.

I yield to the Senator from Virginia and will then regain my time.

As I stated, the Chief of Naval Operations indicated he would need approximately $13.5 billion each year for the next decade to recapitalize the fleet. However, the President's budget request only includes 7 ships in fiscal year 2007 versus the 11 that the Chief needs to maintain the 313-ship fleet. Seven ships in fiscal year 2008. In 2009 the suggestion is they move up to nine ships. But those plans have been delayed before.

This shipbuilding level simply cannot sustain the fleet. My greatest concern is with respect to the construction level of submarines. While many believe that the need for submarines has diminished with the end of the Cold War, the demand for these unique assets has never been greater.

Last week I was with Senator Dodd and Senator Inouye for the christening of the USS Hawaii, our newest Virginia Class attack submarine at Groton, CT. Admiral Roughhead, Commander of the Pacific Fleet, pointed out submarines are his most demanded asset. They are the one ship that is constantly requested by commanders throughout the Pacific to do the tasks that are necessary to defend the Nation.

This is true in our global war on terrorism as we need the ability for stealthy insertion of special operations troops. We need to be able to recover these troops, we need to have the capacity to strike with precision-guided Tomahawk cruise missiles. All of these are capabilities of the submarine fleet.

Back in March of 2004, Admiral Bowman, who was then the Director of the Navy's Nuclear Propulsion Program, suggested to me that the Navy was only able to meet about 65 percent of the combatant commanders' submarine requirements with the current fleet of 54 boats. In 2003, Vice Admiral Grossenbacher, then commander of the Naval Submarine Forces, estimated we needed 70 submarines to meet the request of all of the commanders. These are requests that will simply not be met if we drop our submarine fleet below certain limits.

In addition, we understand that China is developing a very robust submarine fleet. Today, China's submarine fleet is estimated at a number of approximately 60 boats. In 2004 and 2005, 12 new submarines joined the Chinese fleet. New nuclear-missile-attack boats are coming on line, and China has one of the largest modern diesel submarine fleets in the world. Clearly, there is a need to prudently react to the growing underwater prowess of China.

Presently, the U.S. Navy has 282 ships, including 54 attack submarines. In the fiscal year 2007 long-range plan for construction of naval vessels, the Navy expressed the intent to maintain 313, but only 48 attack submarines. Recall recently there were requirements for up to 70 submarines--at least discussion of 70 submarines--or 54 submarines; 48 attack submarines are currently in the plan. The Navy is in danger of not even being able to put to sea 48 attack submarines at current build rate.

Right now the Navy is currently procuring one Virginia class attack submarine per year, and a ninth is in the budget for this year. However, under the original plan drawn up by the Navy in 2003, production of two boats per year was supposed to begin in fiscal year 2007. Now the procurement of two per year has been pushed back to fiscal year 2012.

If the Navy is able to implement its plan and begin building two attack submarines per year in fiscal year 2012, the attack submarine fleet will still drop below 40 before it begins to increase again. If the 2-per-year procurement keeps getting pushed off to the left--it has already happened 10 times where it has been pushed back--the submarine force would drop as low as 28.

I think we all agree that 28 is a number that cannot be justified in terms of the demand and in terms of this effort. We have to do quite a bit to move up the construction of two submarines per year.

First, the report language accompanying this bill states: ``The Committee does not understand the continuing delays in increasing the [submarine] construction rate'' and directs the Secretary of the Navy to submit a detailed plan for lowering costs and defining goals and benchmarks for the Virginia class production program. I believe this language will help compel the Navy and the industry to redouble their efforts to increase the construction rate--and that is vitally important.

Second, I am pleased to know that this legislation includes $65 million for R&D for the Virginia class submarines.

This R&D is I think critical not only to improve the capabilities of these ships but also to continue to engage in the design force which is part of the human capital in our submarine industrial base.

Also, I note that the bill includes $10 million for funding to begin design work on the successor to the Ohio class ballistic submarine. This design work is essential to continue our ability to produce a follow-on generation of attack submarines but also ballistic submarines.

I think this is absolutely critical.

Let me turn to another point with respect to our Army; that is, end strength.

I am pleased to see that this bill authorizes an Active-Duty Army end strength of 512,400, which is 30,000 over the President's fiscal year 2007 budget request.

The act also authorizes an Active-Duty Marine Corps of 180,000, which is 5,000 over the President's budget request.

I think it is important to maintain the end strength of the Army.

I think it is a result of the efforts of Senators Lott and Talent and myself on the budget resolution, where we actually moved $3.7 billion to accomplish this.

Let me make one final point, if I may.

The Army end strength is a critical issue. I think we have to note, at this time but also at a later date continue to note, that recruiting is becoming a critical issue for the U.S. Army. According to the information I have, the U.S. Army, in the first three-quarters of the year, has recruited to a level of 40,000. That means in the final quarter the Army is going to have to recruit 40,000 soldiers to meet their goals. That is much higher than they have ever done in the last few years.

We have a recruiting problem that is beginning to emerge.

I will devote additional time on this subject at a later time.

I yield the floor.