Floor Statements

I thank the distinguished Senator from Texas for allowing me part of the time. I ask unanimous consent to be recognized for 10 minutes.

I associate myself with the remarks of the distinguished Senators from Texas and Missouri. I am grateful for great Americans such as David Petraeus, and I am particularly grateful for the young men and women, Americans who volunteer day and night, who go to defend liberty, peace, and freedom around the world. I come to the floor now for just a few minutes to speak on the housing bill pending, coming back, and the stimulus bill coming to the floor, and a cloture vote that is going to take place at 2:15.

Mr. President, I come to the well specifically today to talk for a few minutes about the tax credit proposal that is included in the base bill as introduced by Senators Dodd and Shelby and approved by the Finance Committee, Senator Grassley, and Senator Baucus. To that end I want to pay particular thanks to the staff of the Finance Committee for the tremendous work they did with respect to the housing tax credit amendment which is now part of the base bill.

I come here today, though, to correct some misinformation that has been appearing in the media particularly over the past weekend and in a couple of national publications and Washington newspapers with regard to the housing stimulus and tax credit being inappropriate or wrong. The presumptions of those who have written are absolutely inappropriate and wrong. Although they are attempting, I am sure, to contribute to the debate, they are in fact contributing to a tremendous misunderstanding about the reality of what the tax credits will do.

For the sake of discussion, the tax credit is a $7,000, $3,500-a-year tax credit that goes to any family who buys and occupies as their residence any home that has been foreclosed upon or is owned by a bank or lender, new or resale, and any resale owned by an owner occupant who is fending foreclosure.

There have been two comments made about what is wrong with this proposal that are exactly the opposite of what is really right about this proposal. No. 1, in one editorial it said it is rewarding people who did not pay their payments and punishing people who are making their payments. It is not rewarding anybody. If you are purchasing a foreclosed-upon house, the damage has already been done to the borrower. The family who didn't perform is not rewarded. In fact, they have already suffered their punishment. But everybody else in the neighborhood is suffering punishment because that vacant house sits there deteriorating and causing declining house values.

Secondly, it does not punish the homeowner who is in their house making their payments because the truth is, that home owner is hurt more when a foreclosure sits vacant and unsold than it is when that property is taken, bought by a homeowner, reestablished, the lawn is kept, the values are stabilized.

The fact is, we have an obligation at this critical time in our economy to do what we can to stimulate the market to solve our problems, not have a plethora of government solutions to problems. Stimulating the market to go back, absorb these houses, get them back in owner-occupied hands, get them out of REO inventory is precisely what we need to do.

Now, I do not come to this opinion as someone who has no experience; I come to it based on experience 33 years ago, in 1975. I was in the business. The United States had gone through a serious decline in housing. We had a problem. We had a 3-year supply of new houses standing unoccupied on the market. Buyers retreated because they did not know where the bottom was. The economy went down. Everything was in a mess.

Gerald Ford, a Republican President, and a Democratic Congress came to this very floor and introduced a $2,000-a-year tax credit to any family who went and bought one of those standing vacant new houses only--not any house, the standing vacant new houses that were there, the problem houses. They passed the $2,000 tax credit. The market immediately responded. Within the 1-year window of opportunity for that credit, two-thirds of the standing inventory was absorbed, home values stabilized and began to go up, and the economy returned to vitality.

So I ask those who are writing in criticism about a bill rewarding people

who did bad things and punishing people who did it right, they are exactly the opposite; the damage has already been done when the foreclosure has taken place, and the reward is to stabilize neighborhoods for those who are in their homes and paying.

I think the wisdom of the Finance Committee and the Banking Committee to incorporate this provision is an insurance policy that we in Congress can do good things to drive the market, to help solve problems. You hear all those problems about us making payments for people and doing things to take money from one American and give it to another in a time of trouble. That only postpones the inevitable. It does not solve the problem. But stimulating buyers back to the marketplace to absorb those houses that have been foreclosed upon or are pending foreclosure addresses specifically the housing crisis in this country, absorbs specifically the houses that are causing us problems, reestablishes values in our neighborhoods, and stabilizes the values of those people who are in their homes making their payments, doing what is right.

So with all due respect to those who have opined over the weekend, they are absolutely incorrect and wrong in terms of the applications of this credit. It will, in fact, be a boost to the economy, a boost to the housing market, and a stabilizing factor on home values and equities in the United States of America.

I yield the floor.

I will.

That is right, $3,500 a year for each of the first 2 years you occupy it as a resident.

The Senator's question is right on target. My answer to you is not an opinion, it is a statement of what actually happened in 1975. In 1975, there was no demand for housing because the plethora of houses that were on the market that had been foreclosed on that were built new were not being sold. Nobody was in the market. When the $2,000 tax credit was established and those houses began to be absorbed, the housing values stabilized. So there was not a disadvantage to the person who was trying to sell who was in the house, it was actually an advantage.

The disadvantage you have right now is nobody knows where the bottom is. Because foreclosures are taking place, the values are going down. Those values, because of the cost-to-replace method of appraising, which is used by all lenders, decline the value of appraisals of houses that are pending on the market. It is a domino effect that affects everybody. The tax credit, by absorbing those houses that have been foreclosed upon and are vacant and are bringing down values, undergirds the market and raises those values for everyone.

I am here.

Well, two or three points. The first one I made is still the valid point; that is, as those foreclosures are absorbed, values stabilize and go back up, and that supports the values that were there in the neighborhood for the people who are making their payments, not in foreclosure. That is No. 1.

Forget about the tax credit. You ride through any neighborhood where somebody is in a house that is in trouble and look at the sign. It will say ``Drastic Reduction.'' ``Reduced.'' ``Foreclosed Property.'' ``Fire Sale.'' ``Thirty Percent Discount.'' All you have to do is open any newspaper in any urban area in American, and you can read the classifieds and see that today. That is what is doing the terrible damage. That is because those numbers are growing. So if the incentive is to absorb those that have been foreclosed on, then you lessen that downward pressure, you underwrite the house values, and the neighborhoods begin to restore.

Remember this: The tax credit is only good for a year. It is only a finite period of time to drive people to the market in hopes that they will absorb those houses because if they do not, the only way they get absorbed is through deeper discounts because regulators are going to force those lenders to dump them. The deeper the discount, the more depressed values are, and the more difficult it is for anybody to sell their house at a reasonable value.

Mr. President, I thank the Senator from Texas.

While the chairman of the Finance Committee is on the floor, I express my appreciation to him, Chairman Baucus, on the hard work that has been done on this particular legislation, in particular, the tax credit on foreclosed homes, and to praise his staff for the late night concentrated hours Tuesday night and early Wednesday morning when this was put together. It was a remarkable effort and I wanted the chairman to know how much I appreciate it.

Would the Senator yield for a question?

Mr. President, I wish to ask the Senator from Maryland a point of clarification for the Members. This amendment is an additional tax credit in addition to the one that is already in the bill; is that correct?

So what you are doing, you leave targeted the stimulus

to absorb the foreclosed properties, but you add a stimulus for first- time home buyers in the marketplace?

I wanted to make sure that is reflected in the Record.

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

Mr. President, I am delighted to come to the floor today to praise the Senate for the most recent action in approving the motion to proceed on the issue of the day in America, and that is the housing crisis, the mortgage crisis, and what has been happening to our homeowners, mortgage companies, and our communities.

I pay particular attention and thanks to Harry Reid of Nevada, the majority leader; Mitch McConnell of Kentucky, the minority leader; Chuck Schumer; Lamar Alexander; John Ensign; Chris Dodd; Richard Shelby; and a host of Members who came together, and instead of agreeing to disagree, agreed to agree and set a platform from which this Senate, in only the way the Senate can do it, can deliberate the most pressing issue of the day.

I thank them for incorporating and including me in those discussions, and I want to share one of the things I shared with them and what I think should be a key part of any solution we offer on behalf of the housing market and the mortgage crisis.

One of the good things about getting older--and I am 63--is that you have had a lot of experience, hopefully all of it good, but it is not all good. I was in the real estate business for 33 years before I came to the Senate, and I was in it in 1974 when we went through one of the worst housing recessions ever. I was also in it, thank goodness, in 1975 when a Democratic Congress and a Republican President, Gerald Ford, brought forward a tax credit bill to stimulate the housing market.

In 1975, we had a similar problem. We had gone through a period of easy credit and lousy underwriting, except it wasn't on the mortgage side, it was on the construction loan side. At banks around the country, if a guy came into the bank and had a pickup truck and a hammer, he qualified as a builder, and he went out and bought a lot and started building spec houses. Banks made the loans and even advanced some of the development costs. Some A and D lenders would loan 100 percent of the cost of the acquisition and 20 percent of the development--crazy underwriting. It led to a plethora of new houses being built but no buyers for these houses. The United States found itself in the position of having a 3-year supply of standing new inventory on the market and no buyers.

What happened? Values started declining, grass started growing, and vandalism started taking hold on the vacant houses. It was a horrible situation. The President and Congress came together and said: Why don't we stimulate the market to absorb these houses, get the buyers back into buying houses. We passed a $2,000 tax credit to any family who bought and occupied as their principal residence a single-family new house that had been built, not a resale or any other house, but a single-family new house that had been built and standing in inventory.

We passed that $2,000 credit which, to give some idea of perspective, was about 8 percent of the value of an average house at that particular time in the marketplace. What happened is overnight, buyers sitting on the sidelines came out. They bought the standing houses that had been vacant and unseen for months. Housing values stabilized and began to go up, the economy turned around, and we went out of a recession, into prosperity, absorbed the inventory, and we did not bail anybody out. We just motivated homebuyers to do what they do best, and that is buy the designated houses which were the problem.

Two months ago, I introduced a similar bill based exactly on that experience, except instead of $2,000, it was a

$15,000 tax credit earned over 3 successive years, the first 3 years after the purchase, of any one of a category of three types of houses:

Category No. 1, a new house built unsold, vacant, and permitted prior to September of last year. Any builder in America who permitted a house before September of last year did so when times were good. There was no looming indication we were going to get into the problem we are in now. They got caught like a lot of these homeowners and junk mortgages got caught, subprime mortgages.

Second, a house that qualifies is a house that has been foreclosed upon, the foreclosure has been adjudicated, and it is owned by the lender or the lender's designated agent. That is a standing vacant house foreclosed on and up for resale.

The third category is any house in foreclosure pending adjudication. That means it is being advertised, a foreclosure notice has been posted, and the house will be foreclosed on but has not yet.

Any one of those three types of houses, which is where the growing inventory is, will be eligible for the buyer to earn a $15,000 tax credit allocated over the first 3 years in which they occupy the home. If it is a speculator in foreclosure, it does not qualify. If it is a speculator who is trying to buy, they don't get the tax credit. This is to stimulate houses being bought that are in trouble, owner occupied by principals who bought those houses, and it qualifies for people who will buy those houses, refinance them, pay off the loan, and live in them as their residence.

What is going to happen, if the Congress is able to come together and pass a tax credit proposal such as that, is we will instantly stimulate the housing market and the marketplace, and the consumers will begin absorbing the standing inventory that is in foreclosure or pending foreclosure or is new and has been sitting since September of last year. That is precisely where the problem is. That is precisely what needs to be absorbed.

There are a few people who said: What about people who have been making their payments and are not in trouble; why don't you get the credit for buying their house if they want to sell it? That is not where the problem is, No. 1. No. 2, they are suffering from all these vacant houses being out there as well because housing values are declining, appraised values are declining, equities are shrinking, and equity lines of credit are drying up. We need a focused, targeted absorption vehicle to see to it that the buying public solves our problem for us. That is the right way to do it.

One other feature of the proposal is the tax credit will only be available and able to be earned on a purchase of a designated property made between April 1, 2008, and March 31, 2009--a 1-year window of opportunity. That creates the urgency of the situation, it motivates people to get into the marketplace or lose that opportunity, and it will be a significant catalyst to the marketplace, solving a significant problem for the United States of America.

I encourage my colleagues on the Banking Committee. I appreciate their consideration of this proposal and this concept. I hope that when the bill comes to the floor either in the base bill or in the amendment process, we can address a past solution that worked and add it to a contemporary problem that was identical to what the problem was in 1974 and 1975.

I end where I began. I thank my Democratic friends and my Republican friends who came together and decided to make something work rather than figure out how we can just be against one another. Senator Schumer has been a catalyst in this effort, Senator Ensign, Senator Alexander, Senator Reid, obviously, Senator Dodd, and Senator Shelby. I pay tribute to Senator Tom Carper who talked with me over weeks about the proposal I just discussed and finding some way to bring it to the floor of the Senate and get it out there so we can address the problems that exist in Delaware, Missouri, Georgia, Nevada, and in all the 50 States over the United States of America.

I am privileged to be the author of the amendment. I will be proud to be part of a team that does not want to take credit but wants to get something done, put together a bipartisan bill that addresses the most contemporary problem today in the United States of America, and that is the housing crisis.

I yield the floor and suggest the absence of a quorum.

Yes.

Mr. President, today, I will pay tribute and make some celebratory remarks about two exciting lives in my community. First is the upcoming celebration of the 80th birthday of Mack Henderson, a man in my community who, besides being a leader, has been a warm and trusted friend. He and his wife Jean have been pillars of our community. The women's health care facility in Kennesaw was named after them as a tribute. Mack's daughter lives in this area, in Alexandria, VA. She has been a great friend to me. The entire Henderson family is going to gather to celebrate the 80th birthday of Mack Henderson, a great American and a great citizen of Cobb County. I wish him a most happy birthday.

On March 10, another birthday occurred--the very first of my grandson, William Edwin Isakson, born to my son Kevin and his wife Katherine Isakson. William is our eighth grandchild. He weighed 7 pound 9 ounces. He has a great future ahead, and I wish him the very best.

It occurred to me, when I was coming to the floor to pay tribute to Mack Henderson on his 80th birthday and to recognize the birth of my eighth grandchild, that as I look into the future, I wonder about what has been said in recent months about Social Security and Medicare and about what Mack Henderson has enjoyed in his life and what I hope we can save and procure for the life of young William Edwin Isakson.

In Mack's early years, Social Security was created. It was a promise to Mack and to every citizen in America that when you reach the age of 65, and when you sign up and are declared eligible, you will receive a supplement to help you in your retirement years. Mack has been retired for 15 years and is enjoying the benefit of that.

Last week, the Social Security Administration sent out a mailer notifying us that the time the Social Security goes bust is now moved forward to 2041. So in Mack's lifetime, Social Security was created, and by the 33rd birthday of my new grandson, Social Security will be gone. Even worse, Medicare, created after Social Security, has benefitted Mack. He has had a heart transplant and other medical problems, and he came through them with the help and assistance of Medicare. As for my grandson William, before he is a teenager, Medicare will be broke, inverted, and gone. As a Member of the Senate who takes a privilege to come to this floor and celebrate the birthday of a great friend and the birth of a new grandson, I know I have some work to do. So do the other 99 Senators and the 435 Representatives on the other side of this building.

The President who serves now, and who will go out of office in January, has made an effort on Social Security, and it was rejected by organizations and others. It was an effort of privatization.

The next President will not be so lucky to be able to neglect this. Time is running out. The next President will probably serve for 8 years. When they are out, it will be 2018, 1 year before Medicare goes broke. I don't think we can afford to allow that to happen.

As I come to the floor and pay tribute to these great lives which are so meaningful and significant to me, it is also an early warning for all of us to get to work on Medicare and Social Security. I commend Judd Gregg, the Senator from New Hampshire, for his efforts time and again to get us to deal forthrightly with these issues. They are not going to be easy.

I don't want to ever face seeing Medicare go out of business and Social Security go broke. I am willing to stand up and take the heat and make the recommendations and work hand in glove with my fellow Republicans and with Democrats to see to it that the events on those two dates--the date of the death of Medicare in 2019 and end of Social Security in 2041--never take place. Between the two sides of the political spectrum, we can find common ground if we have a willingness to establish a goal and achieve it. I will never forget when President John F. Kennedy came forth to the people in America and declared that one day--8 years later--the United States would launch a man to the Moon, land him on the Moon, and bring him home safely. We didn't know how to do that; we didn't have the foggiest idea. We were getting beaten badly by the Soviet Union in mathematics, science, exploration and technology, and he was daring us to do something nobody knew how to do. We did it by July of 1969.

I don't think saving Medicare and Social Security is as difficult or as technical as getting a man to the Moon and bringing him home. But it is equally as important--maybe more so--for the health, welfare, and livelihoods of our oldest friends who are in the twilight of their years and our children born to us this year; and it is very important to the United States.

So this Senator pledges to his newest grandson that I will stand up anytime, anyplace, or anywhere and work with my colleagues in the Senate to begin the job of seeing that we fix Medicare and Social Security and that we preserve the promise for our grandchildren that our grandfathers have enjoyed and prospered with.

I yield the floor.

I thank the Senator.

Mr. President, I wish to honor in the Record Temple Emanu-El in Dunwoody, Georgia.

On March 29, 2008, Temple Emanu-El will celebrate its 30th anniversary with a black tie gala. This traditional reform synagogue was founded in 1978 by a small group of families determined to create a spiritual home where they and their children could live and grow in the Jewish faith, and they certainly have grown. Temple Emanu-El now serves over 800 Jewish families in the metro Atlanta area. The members of this thriving and vibrant congregation should be commended for their dedication to their faith as well as their community.

It gives me a great deal of pleasure and it is a privilege to recognize on the floor of the Senate the contributions of Temple Emanu- El. I congratulate Rabbi Julie Schwartz and the entire

congregation on its 30th anniversary and its bright future.

Madam President, I wish to acknowledge the kind remarks of Senator Schumer with regard to a proposal I have made. For the public's edification and amplification, nobody over here is just saying no, except the majority leader just said no to offering our amendments to the stimulus package we want cloture on. What we are going through right now are some gymnastics and the gymnastics are this. Members on both sides of the aisle want to do something because we do recognize there is a housing problem, because there are ways we can help the American public. But you can't address all those ways if you don't allow all those ideas to be debated as a part of the amendment process on the legislation.

So I appreciate the kind remarks of the Senator regarding my proposal, but a favorable comment doesn't do us any good if you can't offer the amendment on the floor. I don't think I have all the good ideas. I don't think they have all the good ideas. I think, collectively, we probably do have all the good ideas. But this is not about just saying no. This is us saying yes to a process that is open, a process that is debatable, a process where we can reach out and try and help the American people, particularly those who are having great difficulty because of the housing market today.

So I wished to throw that in. My remarks were intended to be about Iraq, which I am going to close with, but I had to respond to the statements the Senator from New York made.

I am happy to yield.

Madam President, I thank the Senator from Florida, and I acknowledge that he is a former Secretary of the Department of Housing and Urban Development, who has done tremendous work on the housing issue. I concur with each of his remarks.

I will close with this. When you talk about ``just say no,'' we ought to have been on the stimulus debate when we got back here on Tuesday. For some reason, and because the majority wanted to, we have been debating the Iraq situation while the stimulus and housing sit on the sidelines. I hope we can get through these gymnastics and get to a situation where we can debate good ideas on both sides and not preclude and leave people out. Instead of saying ``just say no'' to amendments and to a sincere effort, say yes to what this body is all about: deliberation, decisions, and doing what is right for the people of America.

I yield the floor.

Mr. President, I stand before you today to congratulate the Peace Corps on 47 years of service. The Peace Corps was founded on March 1, 1961, when President John F. Kennedy signed an Executive order establishing the Peace Corps as a new Government agency. Over the years, 190,000 volunteers, including nearly 2,700 Georgians, have served in more than 139 countries around the world. Throughout its history, Peace Corps volunteers have responded to the issues of this world with energy, purpose, and compassion.

From February 25 to March 3, 2008, thousands of former Peace Corps volunteers will share their experiences with schools and community groups across the United States during Peace Corps Week. Through these activities, former Peace Corps volunteers will help our citizens better understand the advantages of becoming a Peace Corps volunteer. They will also have the opportunity to educate about the people and cultures they have encountered during their service. Additionally, by making presentations in classrooms, former volunteers will help create greater global awareness among students.

I also want to take this opportunity to pay tribute to the late U.S. Senator Paul Coverdell of Georgia, who was my good friend and colleague for many years. As the corps' first post-Cold War director, Paul steered the Peace Corps into a new era. I was pleased the President honored Paul posthumously in 2001 by renaming the Peace Corps headquarters in Washington, DC, as the Paul D. Coverdell Peace Corps Headquarters as well as renaming the Peace Corps World Wise Schools program as the Paul D. Coverdell World Wise Schools program. I am proud to support an organization that such a distinguished Georgian was so instrumental in shaping.

I am pleased that the President announced the reopening of a Peace Corps mission in Rwanda during his visit to the country last week. I believe the Peace Corps will make an important contribution to the recovery of that country.

Today, there are 8,079 Peace Corps volunteers and trainees in 68 posts serving 74 countries. Of those volunteers, 160 are from my home State of Georgia. I want to take this opportunity to thank those Georgians and all Americans who have served in the Peace Corps. The Peace Corps is a critical piece of our diplomatic and humanitarian efforts worldwide. I look forward to supporting the Peace Corps as a Member of the Senate.

Madam President, I rise for just a few minutes. I know the distinguished Senator from Michigan

wants to speak, and I will not be long, but I feel compelled to come to the floor today to speak about S. 2634, to require a report back to the people of the United States and to the Congress on our country's plan to address al-Qaida and its affiliates on a worldwide basis. It is very disappointing to me that we would put something on the floor like that when, in fact, it is those who have objected to the plan we have who are causing all of the problems we are experiencing today. I wish to go through it for a moment because there is a plan.

Nine days after 9/11, when the United States of America was attacked and New York City was attacked and the world saw the evil of al-Qaida and the evil of terrorism, the President of the United States went to the floor of the U.S. House of Representatives, and he made a speech in which he declared a change in U.S. policy--a change from one of reaction to one of preemption.

So, first of all, we don't need a 60-day report back to the people of the United States on what our policy is. Our policy is one of preemption. Now, if you want to argue whether that is right or wrong, it is fine with me, but don't pretend as though we don't have a plan.

Secondly, in terms of preemption, it is a proposition where you don't want to see what happened on 9/11 happen again, so you are proactive rather than reactive. We were attacked as a country in the late 1990s and early 2000 seven different times in which we reacted after the fact. In most cases, those reactions were benign. In one case, we sent one missile into an aspirin factory, but it was too late for the diplomats who had died, for the soldiers and sailors on the Cole who had died, and for others who had died tragically under terrorist attack.

So, first and foremost, I would submit that we have a policy called preemption.

Thirdly, I would submit it has been a pretty good policy because since the President of the United States established it in that speech on the floor of the House in September of 2001, there has not been a single executed attack on the United States of America on our homeland. I think that is pretty good evidence that we have a plan, and a plan that is working in the interest of the safety of the American people.

Fourth, recommendations regarding the distribution and deployment of U.S. military, intelligence, diplomatic, and other assets to meet the relative regional and country-specific threats described in paragraph 1. The people who want to pass this bill are the very people who 2 weeks ago would not allow us, in the House of Representatives, to extend the Foreign Intelligence Surveillance Act. Here we are asking what our plan is going to be. Yet people are voting against the United States having the intelligence to conduct the worldwide program against al-Qaida and its affiliates. You just can't have it both ways.

I respect anybody being opposed to our deployment in Iraq. I respect anybody's opinion in this body--or any other body, for that matter--on the policy of the United States. But do not on the one hand assume we have no policy and then on the other hand vote against every meaningful contribution to the policy we do have, and the absolute prima facie evidence of that is FISA. Go look at the votes in the Senate on who voted against the extension of FISA, and you will find the same people who are supporting and furthering S. 2634. It is on its face patently unacceptable.

Lastly, it requires recommendations to ensure that the global deployment of the U.S. military of personnel and equipment best meets threats identified and described in paragraph 1; and, A, doesn't undermine the military readiness; B, requires the deployment of Reserve units more than twice, once every 4 years; and C, requires further extension of deployments of members of the U.S. Armed Forces.

Let me interpret what that means. In 60 days, they want us to report to our enemies exactly what our military deployments are going to be in the future. One thing you don't do when your sons and daughters are engaged in harm's way around the world is tell your enemy what your game plan is. Sure, you should have one, and it should be one we all listen to on the fourth floor in our secured briefing rooms, but don't require it to be advertised to the world.

We live in the greatest, freest, most liberty-loving country in the world. We fight in this body every day to protect the Bill of Rights. But we have to recognize something: The terrorists don't want what we have. They don't want us to have what we have. They don't want us to have a first amendment to protect speech or for me to be able to stand up here and express myself. They don't want a law-abiding citizen to be able to carry a firearm or own a firearm. They don't want you to be able to worship on Sunday or worship on Friday or worship on Saturday or worship five times a day if you are a Muslim. They want to be able to dictate how you worship and whom you worship. We have to remember that, as we talk about the individual liberties and freedom we protect, those are the very liberties al-Qaida and its affiliates, as this bill portends, want to take away from us. The last thing we want to do is pass legislation requiring us to give them our game plan.

I welcome debate on these issues anytime we want to come to the floor. I take pride in the accomplishments of the young men and women who stand today in Afghanistan, in Iraq, and in other places around the world furthering the interests of the United States of America and protecting us against al-Qaida and its operatives. We have a policy, and it is called preemption. We have a plan, and it is our plan, and it doesn't need to be advertised to them. Most importantly of all, we have the finest men and women in the world executing that plan today around the world on behalf of the people of the United States of America. But let's not require disclosure of our plan, and let's not pretend we don't have a way to attack al-Qaida and its affiliates. We do. It is called preemption. As of yet, they haven't hit us on our territory, in our country since the day we established that as the policy of the United States of America.

I yield the floor.

Absolutely.

Madam President, after seeing what al-Qaida wants to do to us and has done to us, I don't think we should minimize what the effort might be that we have to take.

I say to the Senator from Wisconsin, it is one of preemption, and the No. 1 way to preempt is to know in advance what the enemy is going to do, and the No. 1 way to do that is to be able to surveil known enemies. That is why we have the FISA bill. You can preempt when you have the knowledge. If you don't have the knowledge and you strip your intelligence agency of the business, yes, they are going to grow in 80 countries, and yes, they are going to hit us. So we have a policy of preemption. The best way to preempt is to have good intelligence, and the best way to get their attention is to let them realize we will go after them wherever they are as long as they declare war on the United States of America.

The President of the United States--I believe it was 9 days after 9/11--announced the change of U.S. policy to be one of preemption. That is what I addressed in my remarks. The FISA reference I made was to say that I found it a little unusual for the people who were supporting the bill of the Senator from Wisconsin--whom I completely respect--to be most of the same people who voted against us having the intelligence to be able to preempt them. And then to have a bill that portends we don't have a policy? I just didn't think it made good sense.

Madam President, responding through the Chair, I appreciate the clarification. My point is you can't intervene if you don't know where it is going to happen.

Let me just make a point, if I can. I live in the great State of Georgia, and I live in a suburb of Atlanta. There will be a trial in April of two students at Georgia Institute of Technology--Georgia Tech. Because of the PATRIOT Act and the FISA law, our intelligence agencies tracked communications from Islamabad, Pakistan, into Atlanta, GA, to the library at Georgia Tech to two students, Islamic students who were then communicating to Toronto, Canada, to establish a cell in Atlanta. Days before they were to activate the plan of that cell, our authorities moved in and put them under arrest, and they are going to trial. The cell was never activated. No lives were lost. That is how you preempt. You preempt through intelligence, you preempt from knowing what the enemy is going to do before they do it, and you preempt by having the strong intelligence and military forces to make it work.

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

Mr. President, I ask unanimous consent that I be allowed to address the Senate as in morning business.

Mr. President, we are on a very important piece of legislation, and I thank Senator Bond for all his hard work, and other members of the Intelligence Committee. I hope we can very soon pass a good FISA bill on the floor.

I want to deviate from that debate for a second to talk about a headline many of my colleagues read yesterday, and that we are all reading repeatedly around the United States, and that is the rapid increase in the number of houses going into foreclosure. I want to address that in the context of the economic stimulus package and in the context of a possible recessionary tendency in the economy, and also from a historical perspective, in that we have been down this road before, and suggest there is an action the Senate and the Congress could take, and the White House could endorse, that could avoid an awful lot of foreclosures, improve the housing market, reverse the tendencies toward recession, and be a private sector solution to a problem that is going to be a tremendous burden if we don't act.

I understand the short-term surgical benefits of the stimulus that was passed by the House, the other benefits that the Finance Committee passed. We will work ourselves through that in the next few weeks, and shortly thereafter the American people will more than likely be receiving a check of $300 or more with which to infuse some energy into the economy. But while that is going on, these numbers of a 200-percent and 300-percent increase of houses going into foreclosures are going to materialize into houses in foreclosure.

When we get into the second quarter of this year and the middle of the summer, we are going to find ourselves in a difficult situation where the following has happened: a tremendous number of houses foreclosed on, the banks and lenders taking back inventory--and there is a term called REO, real estate owned--and the regulators coming in, looking at their books and telling them to get rid of that inventory. The lenders are going to then write them down, take them to the marketplace with deep discounts, and sell them.

Now what that is going to do to your homeowners Jim Weichert sells to in New Jersey, mine in Georgia Harry Norman sells to, and those from all around the country, is those people who are in houses making payments and they are in good shape, their value is going to plummet because of the number of foreclosures that is flooding the market. What happens is the equity, the difference between their existing mortgage and the value of the house, decreases because the value of the house goes down. If they are like 87 percent of the American people who have an equity line of credit, where they use the equity in their house as a line of credit, if you will, their available credit is going to be squeezed.

You know what is going to happen then? They are going to stop spending. When that happens, we will have the full pressure of the economy in a downward spiral, and it begins to feed upon itself. That is precisely what happened in 1975.

In 1973 and early 1974, there was a great housing boom in the United States, like we have had over most of

the last decade. And like what happened over most of the last decade with subprime loans and underwriting, back in 1974, money got awfully loose. Banks made loans with very little underwriting criteria, and we had a plethora of new homes built all over the United States by newfound homebuilders who had a hammer, a pickup truck, and easy credit. We found ourselves at the beginning of 1975 with a 3-year supply of vacant housing on the market in the United States. A viable real estate market is a 6-month supply. So you had six times the volume of houses that would be considered a balanced market, and we went into a deep recessionary spiral.

A Democratic Congress and a Republican President passed a $6,000 tax credit available to any family who purchased a standing vacant house in inventory, and that allowed them to collect that credit over 3 years-- the 3 succeeding tax years after the year of their purchase. The only thing they had to do, other than qualify for their loan, and qualify under good qualifying standards, is they had to occupy the home as their residence. In a 1-year period of time, we absorbed a 2-year supply of housing and returned the housing market to balance and the economy stabilized. Although we had the impacts of the oil embargo, which was causing problems with inflation, the economy returned to a relatively stable time period.

I, along with a number of Members of the Senate, have introduced legislation--Senate bill 2566--which takes that model from 1975 and applies it to our problem in 2008. What it very simply does is, it offers a tax credit of $15,000 for the purchase of any house that falls in the following category: a new house permitted before September 1 of last year that is standing and vacant; a house owned by a lender that was foreclosed on in the last 12 months from an owner occupant; and any house pending foreclosure owned by an owner occupant who is willing to sell. That is where all this inventory that is beginning to flood our market comes from. The tax credit would be available if the purchase was made between March 1 of this year and February 28 of next year. So there is a 1-year window to incentivize those who may be reluctant to go in the marketplace to do so.

The Joint Tax Committee has scored this, and guess what the score is--$9.1 billion over 5 years. Put that in the context of the stimulus package that is before us of $150 billion to $160 billion. It is a relatively small inducement to provide a private sector solution to what is about to become a huge burden to the taxpayers of the United States and this Government.

I come to the floor at this time in hopes that some of our colleagues who have not found an interest in this legislation yet will take a look at it. As the author, it is not original thought. I happened to have been a real estate broker in 1975 trying to hang on and make a living to educate my three children, and I saw my Government come to the rescue of the housing economy through energizing people to go in and purchase houses that were in trouble, rather than bail them out somewhere down the line, and it worked. The cost to the Government was infinitesimal, yet the benefit to the public was astronomical.

I hope, as we finish talking about a surgical, strategic, short-term stimulus to get the consumer buying, which is what we are talking about in terms of either the Senate Finance Committee bill or the House bill, we take a look at what is coming. Because, believe me, in July of this year, if we do nothing, we are going to be dealing with a housing supply in this country bigger than it has ever been, with vacant houses by the thousands in neighborhoods, declining values on the value of housing, and people who are in good shape are not going to be able to either have their equity line of credit work or be able to move their house in the marketplace because of the tremendous inventory available.

History is a great teacher both in terms of things you should never repeat but also in terms of things that work and you should repeat again. I would submit the tax credit to qualified individuals to purchase and occupy a troubled house in this economy is an incentive that worked not only for the betterment of the market but for the betterment of our economy and in the best interest of the United States. Senate bill 2566 is an opportunity for us to join together to do something good and right for the American people.

Mr. President, I yield the floor.

Mr. President, I ask unanimous consent to be recognized for up to 7 minutes as in morning business and to maintain the existing 30 minutes for the majority side.

Mr. President, I commend Senator Cornyn on his remarks, and I want to add that I too think it is important to address the stimulus package that has come from the House quickly and decisively. I fall in the category of one of those who has some other ideas as well, but I think while the iron is hot and while we do have a surgical and strategic proposal before us, we should act.

Immediate action can make a large difference in when the infusion comes back into the economy, when the tax breaks can be taken advantage of by business in terms of depreciation and expensing, and in particular for the housing market, the increased loan limits for Fannie Mae, Freddie Mac, and FHA loans will be essential in saving some houses in foreclosure and those ultimately facing foreclosure, because they will be purchased by people who will qualify under the new loan limits and who will be able to take that loan and make it a performing asset.

It is to that subject I want to talk for a second. Experience is a great teacher. There is an old saying if a cat sits on a hot stove, it will never sit on a hot stove again. Of course, they never sit on a cold stove; they just get out of the business of sitting on stoves. In my experience in the private sector as a businessman, for years I was in the real estate business in the 1970s, in particular, in the period of time between 1968, as a matter of fact, and 1999. In the mid 1970s, the United States faced a housing crisis almost identical to what is about to happen in this country today. In 1973 and 1974, we had a huge housing boom, with increasing values, where credit got easier, loan limits got higher, and underwriting got lower. What ended up happening was that a lot of bad loans were made. In that particular period of time, many were to homebuilders rather than homeowners. But suffice it to say it was the same underwriting problem and the same deficiency in terms of loans. A plethora of foreclosures took place, new homes went back, and the United States found itself in 1975 in a recession with a 3-year supply of single-family houses on the market, unsold and with no housing market.

The President and the Congress took action. They passed a $6,000 tax credit, where a family could collect $2,000 a year for 3 years if they purchased any standing new home in inventory and occupied it during those 3 years. Within the course of a year, we had reduced as a country a 3-year supply of housing to a 1-year supply of housing. We had reinvigorated the construction trade, the subcontractors, the building suppliers, those who manufactured carpet, washing machines, dryers, and all the components so important in the overall economy that are spurred by a home purchase.

Yesterday, I introduced, along with Senator Gregg, Senator Craig, Senator Allard, and Senator Chambliss, S. 2566, calling for us to repeat history in this country, to reenergize the housing market that is so sluggish, at a strategic time. We can save houses in pending foreclosure from actually being foreclosed upon and turn them into occupied single-family dwellings. Very simply, S. 2566 would do the following:

It would provide a $15,000 tax credit--$5,000 for 3 years--to any individual, couple, or two people living together filing separately, if they purchased and occupied as their home any single-family dwelling on the market that was: A, a new home permitted for construction before September 1 of 2007 and now vacant; B, a home that has been foreclosed on that was owner occupied and is now in an REO--real estate-owned-- category of any lender, bank, or financial institution; and, C, any property pending foreclosure that is owner occupied.

We all know from reading the paper that foreclosures are going up in geometric proportions. What is about to happen in the first quarter of this year is the largest realm of foreclosures that has taken place in this country in years. What is going to go into the second quarter of this year is those banks being told by regulators they have to get rid of that inventory, that they can't keep it on their books, and banks and lenders are going to do what they have always done. They are going to get rid of them by deeply discounting the prices to try to get people to come and buy those houses.

Now, what that does to Mr. and Mrs. America who live in a house making their payments is it depresses the value of their house, it lowers their home equity line of credit available because the value has gone down, and it stagnates the very consumer the economy has depended on over the last decade for the longest protracted period of growth in our history.

I come to the floor today to ask all the Members of the Senate to take a look at S. 2566, to take a hard look at it, and to make sure they look back at the history of 1975, when we faced almost an identical problem, took the strategic action this bill recommends, and had a result that was absolutely right for the economy and right for the American homeowner.

I understand all kind of incentives, I understand giving money back, I understand trying to send people to do things, but there is nothing better than helping to make the No. 1 investment every American family wants to make. An incentive to do that, at a time that very market is in trouble, is one of the keys to seeing to it that whatever lies ahead for us in our economy is a much lower trough, and maybe even a peak, where we at the right time strategically invest in the American family, in homeownership, and take those houses in ownership by lenders and put them in the ownership of families.

Mr. President, I yield back the remainder of my time, and I suggest the absence of quorum.

Mr. President, I rise in morning business to discuss a recent trip I made about 2 weeks ago to Iraq. It was a trip I made, as I have every year since I have been in the Senate, to visit Iraq, to visit firsthand with Georgia troops on duty, Georgia troops who are there standing guard for America, as well as to interact with the Iraqi Government--the Kurds, the Sunnis, the Shias--and rank-and-file Iraqi people to measure the progress of our effort in Iraq but, more importantly, the progress of the Iraqis themselves.

I am delighted to be able to come and give a very unbiased and, hopefully, unvarnished and very plain recitation of the remarkable changes that have taken place in that country. We all know a year ago in this body we had serious debate over the fate of our effort in Iraq. There were calls for us to withdraw. There were declarations that we had lost. There were other challenges that were brought forward. But finally, though difficult, the decision by the President to commit to an increase of troops for the surge and follow the anti-insurgency plan of General Petraeus and put General Petraeus in charge finally became a reality.

About midyear on the ground in Iraq the deployment was complete and they began exercising the plan.

Let me try and give an idea of what Iraq today is like compared to Iraq 1 year ago. When I landed at the Baghdad Airport, for the first time I drove

by car--by armored vehicle--into downtown Baghdad. Every year before we had to fly in on Apache helicopters because of the ground fire and the danger. We arrived in Baghdad in the Green Zone and spent the night. On every trip before to Iraq, they took us out to Kuwait City to a Sheraton Hotel when darkness fell in Baghdad because it was so dark. Twice during the course of the visit we got outside of the Green Zone and into a Chevy Suburban in one case, and into an MRAP in another case, and went out on two excursions. I would like to talk about them for a second.

The first was in an MRAP. I have to pause here and pay great tribute to Senator Biden. About 18 months ago, Senator Biden led the charge in this body for us to fund the MRAPs to try and do away with the tragic loss of life that was taking place through IEDs on the ground and on the roads in Iraq and in Baghdad.

There is no question in this body that the most strident voice in favor of that funding and that commitment was the Senator from Delaware. Today, the soldiers of the United States of America and of Iraq and of our coalition partners ride in the new MRAP vehicles, which are remarkable. General Petraeus told me at the dinner I had with him that in the first five hits where an IED exploded under an MRAP, there was not a single scratch of an American serviceman. I know a week ago we lost our first serviceman in an MRAP, but that serviceman was the gunner above the turret at the time he was hit. It has a 100-percent record in terms of those inside of the MRAP when moving the troops. It is a marvelous transformation and a great testament to this body, Republican and Democrat alike, to rise to the occasion to see to it that when our men and women are threatened, if there is a technique, if there is a technology, if there is engineering sufficient to bring about a new product, we will do it, and we will fund it. We did it on the MRAP, and today our soldiers are safer and our efforts stronger.

I rode in one of those MRAPs to a neighborhood known as Gazaria. Gazaria was the neighborhood that was completely destroyed 2\1/2\ years ago. I went to a market that had about 20 shops, of which about half were open, and traveled with a squad headed by a lieutenant colonel who was making microgrants and microloans and measuring the progress of previous loans that had been made to Iraqis who were reopening their stores. Senator Cornyn, Senator Coburn, and myself stood in a bakery and ate an Iraqi-type of flatbread and drank tea in a market that had been totally destroyed and unoccupied for 2\1/2\ years. We went to an auto repair shop where two brothers had reopened the shop and were beginning to do repairs and had bought a generator to provide them with reliable, continuous electricity. These are microloans made by the United States of America to the Iraqi people to reinvest in themselves, reinvigorate their enterprises, reinvigorate their employment.

Was it dangerous? Sure. We had on bulletproof vests, we had on helmets, and we traveled in MRAPs. But heretofore you could never have gone into downtown Baghdad as we did on this trip. Twice we ran into local Iraqis: once two Sunnis who joined the awakening movement and the CLCs who were taking up arms to guard the secured market to see to it that no terrorist or insurgent could come in and do damage, and then twice to refugee families who over 2 years ago had left Baghdad and Gazaria with no intention of ever returning, but now, because of its relative security, they returned.

The second trip was made by Chevy Suburban--not by armored tank or not by MRAP--and we left the Green Zone and went through Baghdad to the government building where we met with Sunni, Shia, and Kurdish leaders. For the first time in my annual trips back there, the talk was substantive and the inference on the part of the leadership was that things were getting ready to get better. As all of us know, on debaathification and reconciliation, things have started to happen.

As the President acknowledged in his speech last night, they will be happening in terms of sharing the oil revenues and eventually a hydrocarbon law for the entire country.

My point in bringing this story to the Senate and telling it firsthand is the progress the President described last night is real. It is tangible. Things are changing in Iraq, and they are changing for the better for the Iraqis and for us. We have brought back two groups, and as the President said, we will bring back five more without replacing them this year. Our troop level will be going down. We are going from a combat confrontation to an oversight role in terms of helping and providing logistics to the Iraqis.

Have the Iraqis responded? Think about this: Remember about 6 months ago when the Prime Minister of Great Britain said they were pulling the British troops out of Basra, and the American press wrote about another failure: One of our partners was leaving, so what were we going to do. Nobody has written about Basra since then because here is what happened: All the Brits who left were replaced by Iraqis--not by Americans, not by coalition forces. Have you read about damage or problems in Basra? No, you haven't because the army has performed magnificently--the Iraqi Army.

Today we read of reports in Mosul, and we mourn the tragedy of the loss of U.S. soldiers, but in that big attack going on against one of the last strongholds left of the insurgents of al-Qaida, the spear of that attack, the point of that attack was all Iraqi soldiers. I had the privilege to meet with Iraqi generals who, for the first time, see themselves energized, see themselves fully capable of assuming the role that we have taken for so long: for us to move to oversight and for them to move to the point of the spear.

The practical matter is, whatever mistakes may have been made in the past, whatever differences we may have had, the young men and women of the United States of America have performed magnificently. General Petraeus has lived up to every single promise of hope we had for him.

In the name and in the memory of the tragic loss of life in Iraq, Georgia soldiers such as Diego Rincon, LTG Noah Harris, SGT Mike Stokely, and the other 119, the sacrifice they have made has not been in vain, and we are on the doorstep, hopefully, of building and of helping to have created a democracy that will last and endure in the Middle East. Hopefully, it will be the first step of many to accomplish the hope of peace, freedom, and liberty that we in this country so often take for granted but the rest of the world cherishes.

So the President was right last night in his State of the Union speech. We have made great progress. There is work left to be done, but there is light at the end of the tunnel, and it is not a locomotive. It is the light of hope, liberty, and peace and freedom because of the sacrifice and the endurance of the fine young men and women in the U.S. military serving in harm's way today in Iraq.

Mr. President, I yield the floor.

Mr. President, I rise before you today to pay tribute to Sidney Flowers. Mr. Flowers was the respected Solicitor General for Liberty County, GA, a popular member of the community, a loving family man and a true Southern gentleman.

After high school, Sid Flowers gave 2 years of service to his country by enlisting in the Army. He then went on to study law at Mercer University law school in Macon, GA, before heading back to live and work in his hometown in Liberty County, GA.

The community was always at the center of Sid's life. He was chairman of the Liberty County Cancer Society, a member of the Lions Club, the Masonic Lodge and the American Legion, as well as an honorary member of the Georgia Sheriff's Association. He was also a committed elder at the First Presbyterian Church, to which he gave not only his time, but also his legal expertise.

The Senate has passed H.R. 3470, a bill naming the post office in Hinesville, GA, as the Sidney `Sid' Flowers Post Office Building. It will stand as a reminder of one man's exceptional contribution to his community.